Gold Resource Corporation Reports Third Quarter Results
/EINPresswire.com/ -- COLORADO SPRINGS, CO -- (Marketwired) -- 11/03/15 -- Gold Resource Corporation (NYSE MKT: GORO) (the "Company") reported production results for the third quarter ended September 30, 2015 of 6,825 ounces of gold, 561,985 ounces of silver ounces, or 14,133 precious metal gold equivalent (AuEq) ounces (calculated at actual sales price ratio of 77:1), which generated $19.4 million in net revenue for the quarter. Gold Resource Corporation is a gold and silver producer with operations in Oaxaca, Mexico and exploration in Nevada, USA. The Company has returned over $107 million to shareholders in monthly dividends since commercial production commenced July 1, 2010, and offers shareholders the option to convert their cash dividends and take delivery in physical gold and silver.
2015 Q3 HIGHLIGHTS
- 14,133 ounces AuEq mill production
- 12,773 ounces AuEq sold
- $19.4 million sales, net
- $603 total cash cost per ounce AuEq (after by-product credits)
- $6.4 million adjusted cash flow from mine site operations
- $8.3 million by-product credits, or $647 per ounce AuEq sold
- $1.6 million dividend distributions, or $0.03 per share for quarter
Overview of Q3 2015 Aguila Project Results
Gold Resource Corporation's Aguila Project produced 14,133 ounces AuEq at a total cash cost of $603 per ounce (after by-product credits). Realized average metal price sales during the quarter were $1,115 per ounce gold and $14.50 per ounce silver. The Company recorded a net loss of $0.5 million, or $(0.01) per share. Adjusted cash flow from mine site operations totaled $6.4 million. The Company paid $1.6 million to shareholders in dividends, or $0.03 per share during the quarter. Cash and cash equivalents at quarter end totaled $14.1 million. Realized gold and silver prices decreased 14% and 28%, respectively, compared to the third quarter of 2014.
Production for the first three quarters of 2015 totaled 21,960 ounces of gold and 1,932,611 ounces of silver. With the weaker than expected 2015 second and third quarter performance, the Company confirms its prior announcement related to the revised 2015 Outlook which reduced annual production targets to 29,600 gold ounces and 2,500,000 silver ounces, a reduction of 6% for gold ounces, and 16% for silver ounces.
The following table summarizes certain information about our mining operations for the three and nine months ended September 30, 2015 and 2014:
Production and Sales Statistics - Arista Underground Mine
Three months ended Nine months ended
September 30, September 30,
--------------------- ---------------------
2015 2014 2015 2014
---------- ---------- ---------- ----------
Milled
Tonnes Milled 105,309 79,568 300,190 283,793
Tonnes Milled per Day 1,143 865 1,104 1,040
Grade
Average Gold Grade (g/t) 2.25 2.78 2.52 3.18
Average Silver Grade (g/t) 180 291 216 297
Average Copper Grade (%) 0.41 0.47 0.39 0.40
Average Lead Grade (%) 1.41 2.12 1.37 1.52
Average Zinc Grade (%) 4.02 5.67 3.78 3.97
Recoveries
Average Gold Recovery (%) 90 92 90 92
Average Silver Recovery (%) 92 92 93 92
Average Copper Recovery (%) 80 76 79 78
Average Lead Recovery (%) 75 80 75 76
Average Zinc Recovery (%) 83 85 82 83
Mill production (before payable
metal deductions)(1)
Gold (ozs.) 6,825 6,523 21,960 26,687
Silver (ozs.) 561,985 687,240 1,932,611 2,506,466
Copper (tonnes) 343 284 929 891
Lead (tonnes) 1,114 1,350 3,071 3,273
Zinc (tonnes) 3,499 3,816 9,299 9,340
Payable metal sold
Gold (ozs.) 6,220 2,932 21,994 19,846
Silver (ozs.) 503,929 575,413 1,770,093 2,171,298
Copper (tonnes) 332 228 877 751
Lead (tonnes) 1,049 1,204 2,875 2,938
Zinc (tonnes) 2,905 2,976 7,668 7,383
Average metal prices realized
(2)
Gold ($ per oz.) 1,115 1,295 1,177 1,287
Silver ($ per oz.) 14.50 20.24 16.09 19.77
Copper ($ per tonne) 4,883 7,103 5,436 6,920
Lead ($ per tonne) 1,619 2,238 1,746 2,157
Zinc ($ per tonne) 1,701 2,394 1,981 2,209
Precious metal gold equivalent
ounces produced (mill
production) (1)(3)(4)
Gold Ounces 6,825 6,523 21,960 26,687
Gold Equivalent Ounces from
Silver 7,308 10,739 26,410 38,495
---------- ---------- ---------- ----------
Total Precious Metal Gold
Equivalent Ounces 14,133 17,262 48,370 65,182
---------- ---------- ---------- ----------
Precious metal gold equivalent
ounces sold (3)(4)
Gold Ounces 6,220 2,932 21,994 19,846
Gold Equivalent Ounces from
Silver 6,553 8,991 24,189 33,348
---------- ---------- ---------- ----------
Total Precious Metal Gold
Equivalent Ounces 12,773 11,923 46,183 53,194
---------- ---------- ---------- ----------
Total cash cost (before by-
product credits) per precious
metal gold equivalent ounce
sold (including royalties)
(5) $ 1,250 $ 1,324 $ 1,046 $ 958
========== ========== ========== ==========
Total cash costs, after by-
product credits, per precious
metal gold equivalent ounce
sold (including royalties)
(5) $ 603 $ 364 $ 505 $ 434
========== ========== ========== ==========
(1) Mill production represents metal contained in concentrates produced at
the mill, which is before payable metal deductions are levied by the
buyer of our concentrates. Payable metal deduction quantities are
defined in our contracts with the buyer of our concentrates and
represent an estimate of metal contained in the concentrates produced
at our mill which the buyer cannot recover through the smelting
process. There are inherent limitations and differences in the sampling
method and assaying of estimated metal contained in concentrates that
are shipped, and those contained metal estimates are derived from
sampling methods and assaying throughout the mill production process.
The Company monitors these differences to ensure that precious metal
mill production quantities are materially correct.
(2) Average metal prices realized vary from the market metal prices due to
final settlement adjustments from our provisional invoices when they
are settled. Our average metal prices realized will therefore differ
from the market average metal prices in most cases.
(3) For the three months ended September 30, 2015, precious metal gold
equivalent mill production differs from gold equivalent ounces sold due
principally to buyer (smelter) concentrate processing and other
deductions of approximately 1,204 gold equivalent ounces and a decrease
in gold equivalent ounces contained in ending inventory of
approximately 121 ounces.
(4) For the nine months ended September 30, 2015, precious metal gold
equivalent mill production differs from gold equivalent ounces sold due
principally to buyer (smelter) concentrate processing and other
deductions of approximately 3,687 gold equivalent ounces and a decrease
in gold equivalent ounces contained in ending inventory of
approximately 279 ounces.
(5) For a reconciliation of this non-GAAP measure to total mine cost of
sales, which is the most comparable U.S. GAAP measure, please see Non-
GAAP Measures.
About GRC:
Gold Resource Corporation is a mining company focused on production and pursuing development of gold and silver projects that feature low operating costs and produce high returns on capital. The Company has 100% interest in six potential high-grade gold and silver properties at its producing Oaxaca, Mexico Mining Unit and exploration properties at its Nevada, USA, Mining Unit. The Company has 54,179,369 shares outstanding, no warrants, no long term debt and has returned over $107 million back to shareholders since commercial production commenced July 1, 2010. Gold Resource Corporation offers shareholders the option to convert their cash dividends into physical gold and silver and take delivery. For more information, please visit GRC's website, located at www.Goldresourcecorp.com and read the Company's 10-K for an understanding of the risk factors involved.
Cautionary Statements:
This press release contains forward-looking statements that involve risks and uncertainties. The statements contained in this press release that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. When used in this press release, the words "plan", "target", "anticipate," "believe," "estimate," "intend" and "expect" and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements include, without limitation, the statements regarding Gold Resource Corporation's strategy, future plans for production, future expenses and costs, future liquidity and capital resources, and estimates of mineralized material. All forward-looking statements in this press release are based upon information available to Gold Resource Corporation on the date of this press release, and the company assumes no obligation to update any such forward-looking statements. Forward looking statements involve a number of risks and uncertainties, and there can be no assurance that such statements will prove to be accurate. The Company's actual results could differ materially from those discussed in this press release. In particular, there can be no assurance that production will continue at any specific rate. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the Company's 10-K filed with the SEC.
See Accompanying Tables
The following information summarizes the results of operations for Gold Resource Corporation for the three and nine months ended September 30, 2015 and 2014, its financial condition at September 30, 2015 and December 31, 2014 and its cash flows for the nine months ended September 30, 2015 and 2014. The summary data for the three and nine months ended September 30, 2015 is unaudited; the summary data for the year ended December 31, 2014 is derived from our audited financial statements contained in our annual report on Form 10-K for the year ended December 31, 2014, but do not include the footnotes and other information that is included in the complete financial statements. Readers are urged to review the Company's Form 10-K in its entirety, which can be found on the SEC's website at www.sec.gov.
The calculation of our cash cost per ounce contained in this press release is a non-GAAP financial measure. Please see "Management's Discussion and Analysis and Results of Operation" contained in the Company's most recent Form 10-Q and Form 10-K for a complete discussion and reconciliation of the non-GAAP measures.
GOLD RESOURCE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands, except share and per share amounts)
September 30, December 31,
2015 2014
------------- -------------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 14,105 $ 27,541
Gold and silver bullion 3,160 3,447
Accounts receivable 1,851 1,416
Inventories 9,347 7,295
IVA taxes receivable 1,870 575
Deferred tax assets 3,891 3,891
Prepaid expenses and other current assets 1,932 2,935
------------- -------------
Total current assets 36,156 47,100
Property, plant and mine development, net 47,808 32,348
Deferred tax assets 27,040 25,519
Investments in equity securities 894 2,620
Other non-current assets 2,964 4,078
------------- -------------
Total assets $ 114,862 $ 111,665
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 8,201 $ 3,892
Accrued expenses and other current
liabilities 5,124 3,923
Capital lease obligations 1,220 1,498
Income taxes payable 3,348 7,907
Dividends payable 542 542
------------- -------------
Total current liabilities 18,435 17,762
Capital lease obligations - 834
Reclamation and remediation liabilities 2,537 2,993
------------- -------------
Total liabilities 20,972 21,589
Shareholders' equity:
Preferred stock - $0.001 par value,
5,000,000 shares authorized:
no shares issued and outstanding - -
Common stock - $0.001 par value, 100,000,000
shares authorized:
54,515,767 shares issued and outstanding 55 55
Additional paid-in capital 96,387 93,094
Retained earnings 4,503 3,982
Treasury stock at cost, 336,398 shares (5,884) (5,884)
Accumulated other comprehensive loss (1,171) (1,171)
------------- -------------
Total shareholders' equity 93,890 90,076
------------- -------------
Total liabilities and shareholders' equity $ 114,862 $ 111,665
============= =============
GOLD RESOURCE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
for the three and nine months ended September 30, 2015 and 2014
(U.S. dollars in thousands, except share and per share amounts)
(Unaudited)
Three months ended Nine months ended
September 30, September 30,
------------------------ ------------------------
2015 2014 2015 2014
----------- ----------- ----------- -----------
Sales, net $ 19,437 $ 21,052 $ 71,082 $ 85,873
Mine cost of sales:
Production costs 13,411 13,025 40,462 43,107
Depreciation and
amortization 1,579 1,180 5,195 2,969
Reclamation and
remediation 6 - 36 -
----------- ----------- ----------- -----------
Total mine cost of
sales 14,996 14,205 45,693 46,076
----------- ----------- ----------- -----------
Mine gross profit 4,441 6,847 25,389 39,797
Costs and expenses:
General and
administrative
expenses 2,913 4,361 8,032 9,623
Exploration expenses 1,810 2,901 6,416 5,786
----------- ----------- ----------- -----------
Total costs and
expenses 4,723 7,262 14,448 15,409
----------- ----------- ----------- -----------
Operating (loss) income (282) (415) 10,941 24,388
Other (expense) income,
net (1,033) 69 (2,080) 766
----------- ----------- ----------- -----------
(Loss) income before
income taxes (1,315) (346) 8,861 25,154
Provision for income
taxes (846) 1,109 3,465 12,264
----------- ----------- ----------- -----------
Net (loss) income $ (469) $ (1,455) $ 5,396 $ 12,890
=========== =========== =========== ===========
Net (loss) income per
common share:
Basic $ (0.01) $ (0.03) $ 0.10 $ 0.24
Diluted $ (0.01) $ (0.03) $ 0.10 $ 0.24
Weighted average shares
outstanding:
Basic 54,179,369 54,179,369 54,179,369 54,098,783
=========== =========== =========== ===========
Diluted 54,179,369 54,179,369 54,201,274 54,698,748
=========== =========== =========== ===========
GOLD RESOURCE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
for the nine months ended September 30, 2015 and 2014
(U.S. dollars in thousands)
(Unaudited)
2015 2014
--------- ---------
Cash flows from operating activities:
Net income $ 5,396 $ 12,890
--------- ---------
Adjustments to reconcile net income to net cash from
operating activities:
Depreciation, depletion and amortization 6,331 3,107
Stock-based compensation 3,293 3,847
Deferred income taxes (1,522) -
Currency exchange (gain) loss (326) 545
Unrealized loss (gain) on investments 1,726 (1,504)
Other operating adjustments 1,072 162
Changes in operating assets and liabilities:
Accounts receivable (435) (3,699)
Inventories (1,149) (1,582)
Prepaid expenses and other current assets (897) 1,354
Accounts payable and other accrued liabilities 5,069 (731)
Income taxes payable/receivable (4,528) 11,907
Other noncurrent assets 466 -
--------- ---------
Net cash provided by operating activities 14,496 26,296
--------- ---------
Cash flows from investing activities:
Capital expenditures (21,837) (10,524)
Investments - (1,805)
Proceeds from sale of building - 1,737
Other investing activities 40 23
--------- ---------
Net cash used in investing activities (21,797) (10,569)
--------- ---------
Cash flows from financing activities:
Proceeds from exercise of stock options - 100
Dividends paid (4,876) (4,868)
Repayment of capital leases (1,123) (1,099)
--------- ---------
Net cash used in financing activities (5,999) (5,867)
--------- ---------
Effect of exchange rate changes on cash and cash
equivalents (136) (33)
--------- ---------
Net (decrease) increase in cash and cash equivalents (13,436) 9,827
Cash and cash equivalents at beginning of period 27,541 14,973
--------- ---------
Cash and cash equivalents at end of period $ 14,105 $ 24,800
========= =========
Supplemental Cash Flow Information
Interest expense paid $ 65 $ 139
========= =========
Income and mining taxes paid $ 8,464 $ -
========= =========
Contacts:
Corporate Development
Greg Patterson
303-320-7708
www.Goldresourcecorp.com
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