| | Published : April 16th, 2007 | Achieves Fourth Quarter Net Income of C$2.6 Million and Records First Annual Net I |
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CENTURY
MINING ACHIEVES FOURTH
QUARTER NET INCOME OF C$2.6 MILLION AND RECORDS FIRST ANNUAL NET INCOME OF
C$1.3 MILLION IN 2006
BLAINE, WA
(CCNMatthews – April 16,
2007) Century Mining Corporation (TSX VENTURE: CMM - News) (“Century”,
“Century Mining”, or the “Company”), today announced
its audited financial results for the fourth quarter and year ended December
31, 2006.
(This news release
contains forward looking information that is subject to risk factors and
assumptions as set out in our Cautionary Statement on Forward-Looking
information located at the end of this news release.).
Highlights
• Gold production at the Sigma mine was 16,494 ounces in the fourth
quarter of 2006 and 70,401 ounces for the full year. Century’s 2006
production was 73,823 ounces for the full year, including 3,422 ounces from the
San Juan Mine1.
• Revenue was $11.1 million in the fourth quarter, a 20.2% increase over
the same period last year, and the average gold price realized was US$621 per
ounce of gold sold. Full-year revenue was a record $45.1 million, an 86.6%
increase over the 2005, and the average gold price realized for last year was
$584 per ounce of gold sold.
• Net earnings for the fourth quarter were $2.6 million or $0.02 per
share (diluted), compared to a net loss of $4.4 million or $0.10 per share in
the same period last year. Net earnings for the full-year were a record $1.3
million or $0.01 per share (diluted), compared with a net loss of $9.2 million
or $0.22 per share in 2005.
• During 2006 it became viable to process ore with a lower grade than in
the Sigma mine plan. The Company therefore lowered the cutoff grade per ton of
ore from 0.85 g/ton to 0.5 g/ton, reducing the design strip ratio from 4.25 to
2.5:1. The resulting excess deferred stripping costs for the year have been
capitalized in the fourth quarter to reflect the revised mine plan.
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Production
(gold oz)
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Cash
Costs of production (US$/oz)
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Q1
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18,943
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386
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Q2
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18,012
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414
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Q3
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16,952
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422
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Q4
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16,494
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330
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2006
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70,401
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390
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•
Operating profit from mining operations was
$13.7 million in 2006, compared to $1.8 million in 2005. The cash position was
$802,132 at December 31, 2006 compared to $808,896 at December 31, 2005 and
long-term debt was $11.9 million at December 31, 2006 compared to $12.8 million
at December 31, 2005.
•
Capital expenditures, including capitalized
stripping and pay downs on leased equipment, were $19.5 million in the fourth
quarter and $35.5 million for the full-year.
•
Proven and Probable Mineral Reserves3 at
December 31, 2006 were 820,300 ounces of gold, net of 2006 production. This is
an increase of 28,172 ounces, after deducting production for the year. These
amounts do not include the effects of the San
Juan Gold Mine acquisition.
•
Production2 for 2007 is expected to be approximately 100,000 ounces of gold at a cash
cost of US$370 to $390 per ounce. Beyond 2007, gold production is expected to grow to 130,000 to 150,000
ounces in 2008.
1.
In 2006, the Company capitalized all San
Juan expenses, including exploration, net of revenues
from gold production of 3,422 ounces. Century will continue to capitalize net
expenses until such time as the mine reaches commercial production, which is
expected to occur in 2008.
2.
Please refer to the risk factors and assumptions set out in our Cautionary
Statement at the end of this news release for information related to risks and
uncertainties associated with guidance presented in this release.
3.
Century’s mineral reserves herein described have been prepared under the
guidance of Mr. Ross F. Burns, P.Geo., LG, Vice President of Exploration, who
is designated as a Qualified Person with the ability and authority to verify
the authenticity and validity of the data.
Margaret Kent, President & CEO commenting on Century’s
2006 results said: “We are very pleased that the Company reported net
income for the full year. In my 30 years experience in the mining industry,
this is the first operation I have been involved with that made a net profit in
just the first full year of commercial production. Although we fell short of
our production target in 2006, I maintain my firm belief that top priority
should be placed on maximizing profits, rather than production ounces. The
Sigma open pit mine will never be a low cost mine, but the company and its
management continue to manage this operation in a way that maximizes profits.
Century has grown significantly since the start of production in 2005, and will
continue to do so, as we focus on both organic growth at existing operations and
new acquisitions in Canada
and South America. For the Sigma-Lamaque
Complex, in particular, management is currently finalizing plans that will
further enhance profitability. Specific initiatives for Sigma-Lamaque will be
announced in a forthcoming press release.”
“In Peru,
we are in the process of rehabilitating the mill at the San Juan Mine to
achieve production in 2008 of 35,000 ounces of gold. Concurrently, Century is
advancing the drilling and exploration program at San Juan that began in December 2006. We will
be preparing a technical report to qualify the resources to NI 43-101 standards
of disclosure based on the results of this exploration program. For the future,
we plan to fully mechanize parts of the mining operations, while outlining
plans to further expand mill capacity, eventually aiming for an annual
production rate of 80,000 ounces of gold.”
“We are taking steps to build Century into a profitable
mid-tier gold producer with a solid asset base in Qu�bec and outstanding
production and exploration opportunities in Peru. Our stronger balance sheet
will enable us to finance future growth and acquisitions on more favorable
terms. We are also building a solid base of institutional shareholders who
recognize management’s track record to add shareholder value by acquiring
assets at a significant discount to typical industry valuation multiples. We
believe that Century is well positioned to grow in value as we pursue new
opportunities with our team of highly experienced mining and financial
professionals.”
Summary of Financial and Operating Results
Canadian dollars
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2006
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Q4-2006
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Q3-2006
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Q2-2006
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Q1-2006
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Results
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Mine revenues
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45,135,717
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11,059,159
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11,045,950
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11,878,882
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11,151,726
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Operating profit from mining operations
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13,703,412
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5,080,956
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3,671,599
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2,911,936
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2,038,921
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Net income (loss)
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1,266,500
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2,554,626
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1,107,485
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(1,198,135)
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(1,197,835)
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Net income (loss) per share
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0.01
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0.02
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0.01
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(0.01)
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(0.01)
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Financial
position
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Cash and cash equivalents
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802,132
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802,132
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3,436,073
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8,481,360
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2,883,663
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Total assets
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98,783,040
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98,783,040
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94,407,128
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88,166,375
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59,163,033
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Long-term debt
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11,921,972
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11,921,972
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11,921,972
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11,921,972
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12,345,922
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Shareholders’ equity
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60,129,560
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60,129,560
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56,937,514
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55,747,845
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24,492,475
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Shares issued and outstanding
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117,859,689
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117,859,689
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115,762,884
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115,574,009
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88,110,789
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Revenue
from metal sales increased 86.6% percent in 2006 over 2005 from $24.2 million
to $45.1 million, primarily as a result of increased production and higher
realized gold prices. The average realized gold price for the fourth quarter
and full-year of 2006 was US$621 and US$584 per ounce, respectively, compared
with US$446 and US$466 per ounce, in the same respective periods of 2005. The
average spot price for the fourth quarter and full-year of 2006 was US$613 and
US$604 per ounce, respectively, compared with US$474 and US$443 per ounce in
the same respective periods in 2005.
Century
produced 16,494 gold ounces in the fourth quarter at the Sigma mine, and,
including the San Juan Mine, 73,823 ounces for the full-year at a cash cost of
US$390 per ounce. The 4th quarter operating costs reflect the
additional deferred stripping and are not an indication of the cash cost of
operating on an ongoing basis. The average cash cost for the year is indicative
of the cash cost of operating on an ongoing basis.
The
Company sold 17,885 gold ounces in the fourth quarter and 70,450 ounces in
2006, an increase from the 53,523 gold ounces sold in 2005, which included
10,356 ounces produced during the pre production phase.
In
2006, corporate administration expenses were $3,955,957, compared to $1,910,024
in 2005. These expenses include salaries and benefits, as well as travel
expenses. The increase of $2,045,933 mainly reflects a higher level of business
activity and expansion of the Company into Peru.
Before
net changes to non-cash working capital balances, cash flows provided by
operating activities were $7,732,767. Major items added back to the net income
of $1,266,500 include amortization, depreciation and accretion of $3,652,814,
amortization of deferred finance fees of $1,081,620, stock-based compensation
of $634,285, and unrealized losses on derivative contracts of $316,075. After
the net change of $2,406,453 to non-cash working capital balances, cash flows
provided by operating activities in 2006 were $5,326,314.
2006 Mineral Reserve and Resource Update
As
of December 31, 2006, Century’s total Proven and Probable Mineral
Reserves* increased to 820,300 ounces of gold from 792,128 ounces at December
31, 2005. Gold reserves increased by 28,172 ounces, net of 2006 production
depletion.
Gold oz
Reserves
at December 31, 2005 ���������� 792,128
Production depletion ��������������� ����������� (74,895)
Reserve additions ������� ����������������������� 103,067
Reserves
at December 31, 2006 ���������� 820,300
*
Does not include San Juan Mine
Gold
reserves increased at Sigma due to the addition of 85,400 ounces from the
Lamaque West Plug. These ounces were brought into reserves from the resource
calculated in 2003 due to the results of the infill drilling completed in 2005
and the pit design completed in 2006. The inferred West Plug resources
increased from 30,000 ounces in 2005 to 32,000 ounces at Dec. 31, 2006. The
Sigma open pit reserve increased as the cutoff grade was lowered to 0.5g/t gold
from 0.85g/t gold. The Residual Open Pit Resources remained unchanged from 2005
with a total of 317,000 ounces in Measured and Indicated and 875,000 ounces in
Inferred Resources.
The
total Measured and Indicated Underground Resources at year end 2006 remained
unchanged from 2005 at 3,923,000 tonnes at a grade of 4.99g/t gold containing
630,000 ounces of gold. The Inferred Underground Resources also remained
unchanged from 2005 at 10,101,000 tonnes at a grade of 5.26 containing
1,708,000 ounces of gold.
Outlook
Commencement
of commercial production at the Sigma Mine in the second quarter of 2005
reflected growth of the Company from exploration and development to a gold
producer. The Sigma Mine has generated positive cash flow in each of the six
quarters since that time. At current gold prices, and with the planned opening
of the Lamaque underground operation to supplement the open pit, the Company
expects that this mine will continue to generate positive cash flow. In 2006,
the Company recorded net income for the first time in its three-year history.
In
2007, the Company plans to produce a total of 100,000 ounces of gold, including
74,000 ounces from the Sigma open pit, 12,000 ounces from the Lamaque
underground mine, and 14,000 ounces from the San Juan underground mine in Peru,
at an estimated cash cost of approximately US$370 to US$390 per ounce.
The
Company is ready to commence production at the underground Lamaque Mine and is
awaiting receipt of a permit prior to commencement of mining. The Lamaque ore
will be combined with the Sigma ore and delivered to the Sigma mill. The
significantly higher ore grades (approximately 5 to 6 g/t) than in the Sigma
pit (1.6 g/t) are expected to have a positive impact on production and unit
cash costs at the Val d’Or
operations.
The
Company has commenced a program of major rehabilitation at the San Juan Mine in
Peru
in order to return the mine and mill to their nominal rated capacity of
approximately 35,000 ounces of gold per year. The program includes mechanized
mining and refurbishing and/or replacement of the mills and other ancillary
equipment. The Company plans to expand production to approximately 70,000 to
80,000 ounces a year over the next two to three years.
At
the same time, the Company has embarked on a major exploration program at the
mine and will commence exploration on the nearby properties upon receipt of
additional exploration permits. The results of the exploration program at the
San Juan Mine will form the basis of a technical report to qualify the gold in
resources previously estimated by the former owner to NI 43-101 standards of
disclosure. These exploration programs could have the potential to create a
major mining district based on the results of previous exploration work.
The
Company is well positioned to grow in market value as management pursues new
opportunities, particularly in Qu�bec and Peru, with an emphasis on the
acquisition of low-cost producing gold mines and assets that generate cash flow
or that can be returned to profitability in the near term. In this regard, a
number of opportunities have been reviewed over the last year.
Since
the Company’s entry into Peru
early in 2006, management has been developing strong relationships and networks
in that country to identify projects for acquisition. The Company, in
conjunction with its Peruvian subsidiary, has developed some important
strategic relationships that should enable the Company to meet its objectives
of increasing production and reducing cash costs to position the Company for a
higher market valuation.
Conference
call
Management will host a conference
call on Friday, April 20 at 11:00 a.m. Pacific time (2:00 p.m. Eastern time) to
discuss 2006 results and future developments at its operations in Qu�bec and Peru.
Mining analysts, investors and the media are invited to phone 1-888-809-8974,
or 1-210-234-0008 if outside Canada
and the U.S.A.,
followed by the pass code 18290 approximately 5 minutes before the start of
management’s presentation. The presentation will be followed by a
question and answer period.
A replay of the conference call can
be heard through Friday, April 27 by dialing 1-888-562-2923, or from outside North America 1-203-369-3750.
Best regards,
Sara Swisher
sswisher@centurymining.com
Century Mining Corporation
Phone: (360) 332-4653
441 Peace Portal Drive
Blaine, WA 98230
Century Mining
Corporation: Century Mining
Corporation is an emerging mid-tier gold producer that is aggressively
acquiring producing mines and exploration properties in Peru. The Company owns and produces
gold at the Sigma and Lamaque mines in Qu�bec that historically have produced
over 9.4 million ounces of gold. In Peru, Century owns an 82.6%
interest in the San Juan Mine where the Company accounts for 100% of gold
production. Century’s growth strategy is to acquire gold producing assets
in South America that will substantially
reduce the Company’s consolidated total cash cost of production and where
there is exceptional exploration potential to expand production at these mines.
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or accuracy of the contents of this press
release.
Caution Concerning Forward-Looking
Information
This press release contains forward-looking
information within the meaning of applicable securities laws. We use words such
as “may”, “will”, “should”,
“anticipate”, “plan”, “expect”,
“believe”, “estimate” and similar terminology to
identify forward-looking information. It is based on assumptions, estimates,
opinions and analysis made by management in light of its experience, current
conditions and its expectations of future developments as well as other factors
which it believes to be reasonable and relevant. Forward-looking information
involves known and unknown risks, uncertainties and other factors that may
cause our actual results to differ materially from those expressed or implied
in the forward-looking statements and accordingly, readers should not place
undue reliance on those statements. Risks and uncertainties that may cause
actual results to vary include but are not limited to the speculative nature of
mineral exploration and development, including the uncertainty of reserve and
resource estimates; operational and technical difficulties; the availability to
the Company of suitable financing alternatives; fluctuations in gold and other
resource prices; changes to and compliance with applicable laws and regulations,
including environmental laws and obtaining requisite permits; political,
economic and other risks arising from our South American activities;
fluctuations in foreign exchange rates; as well as other risks and
uncertainties which are more fully described in our annual and quarterly
Management’s Discussion and Analysis and in other filings made by us with
Canadian securities regulatory authorities and available at www.sedar.com.
Century Mining Coroporation: 441
Peace Portal Drive / Blaine,
WA 98230
/ Phone: (360) 332-4653
If you do not wish to
receive email announcements from Century Mining, simply reply to this message,
and in the body of the message type: Cancel
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Century Mining Corporation
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PRODUCER |
CODE : CMM.V |
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CUSIP : 15662P |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Century Mining is a gold producing company based in United states of america. Century Mining holds various exploration projects in Canada. Its main assets in production are LAMAQUE and SIGMA-LAMAQUE in Canada and SAN JUAN in Peru and its main exploration properties are BOURLAMAQUE, JUNEAU, LOUVICOURT, TREADWELL, NORTH BELT LEASES, YAKIMA, EAGLE RIVER, SWEETHEART, PATTON, PETERSON, DREAM and BESSIE in Canada and COLINA DORADA in Peru. Century Mining is listed in Canada and in United States of America. Its market capitalisation is CA$ 26.2 millions as of today (US$ 20.8 millions, € 16.9 millions). Its stock quote reached its highest recent level on December 29, 2006 at CA$ 1.89, and its lowest recent point on November 28, 2008 at CA$ 0.01. Century Mining has 37 960 000 shares outstanding. |
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