| | Published : January 11th, 2013 | Announces Second Quarter Results |
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Orosur
Mining Inc Announces Second Quarter Results
Orosur Mining Inc ('OMI'
or the 'Company')
(TSX: OMI) (AIM: OMI), the South American focused gold producer and explorer,
today announces its results for the second quarter ending 30 November 2012.
Further to the announcement of 7 December, the Company reiterates that
production for the quarter was 13,970 ounces and Orosur remains on track to
achieve its forecast production target of 63,000 to 68,000 ounces for the full
year.
The Company reports that the development of the Arenal Deeps ramp and lateral
development to enable production from transverse stopes are on track for completion
during the quarter ending 28 February 2013. Completion of the ramp and lateral
development will enable the Company to access higher grade transverse stope ore
at Arenal Deeps for the first time in the last quarter of the financial year
ending 31 May 2013.
Operating and Financial Summary
Key Results Summary1
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Three
months ended
30th November
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Six Months
Ended
30th November
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2012
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2011
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2012
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2011
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Operating Results
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Gold produced
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Ounces
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13,970
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11,916
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29,421
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24,404
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Cash cost2
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$US/oz
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1,215
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1,007
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1,151
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975
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Average price received
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$US/oz
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1,694
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1,717
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1,642
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1,663
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Financial Results
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Revenue
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$US �000s
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24,168
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20,985
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50,502
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42,011
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Net income
for the period after tax
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$US �000s
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1,210
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2,565
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3,501
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6,977
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Cash flow from operations3
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$US �000s
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3,485
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4,651
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8,523
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10,223
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Cash at
the end of the period
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$US �000s
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3,745
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17,054
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3,745
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17,054
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Total debt
at the end of the period
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$US �000s
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9,718
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5,949
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9,718
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5,949
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1 Results are based on IFRS and expressed in US dollars
2 Operating
cash cost is total cost excluding royalties and capital tax on production
assets
3 Before non-cash working capital
movements
Production for the
quarter was 13,970 ounces. Despite ore production being slowed from all pits
due to heavy rain during the quarter and the mining sequence being changed
production and cash costs from Arenal Deeps, Sobresaliente, and Zapucay were
all in line with expectations.
However, ore mined
from the Crucera pit during the quarter was of a lower grade than planned,
resulting in lower ounces produced and higher cash costs per ounce at that pit.
The cash cost per ounce for Crucera has increased because, though we have
produced approximately the same amount of ore at the same cost, the grade of
the ore has been lower than expected and so we have produced fewer ounces, thus
increasing the total cash cost per ounce for the quarter to $US 1,215 an ounce
compared with a target of approximately $US 1,100.
The impact of the
higher cash costs and lower production from Crucera, offset in part by higher
gold prices than we had planned for, reduced our cash flow for the quarter by
$US 2.0 million. As a result the Company's cash balance at the end of the
quarter was $US 3.7 million.
CEO�s Comment
David Fowler, Chief
Executive Officer, commented:
�Production was at
the lower end of expectations for the quarter due to lower than anticipated
grades from the Crucera pit. During December we slowed the rate of mining at
Crucera in order to adapt the mining approach to reduce dilution, thus
achieving less tonnes of ore produced at an improved grade. Accordingly, and
taking account of the significant progress made on developing the ramp at
Arenal Deeps, we remain confident that we will meet our production target for
the second half, and achieve production for the full year of between 63,000 and
68,000 ounces.
�We anticipate that
the grade achieved at Crucera will result in cash costs for the full year being
in the range of $US 1,000 to $US 1,065 per ounce, a modest increase on the $US
975 that we forecast in October. We are focused on improving grade control and
mining practices, and identifying where cost savings
can be made elsewhere in the operation to offset part of the impact of the
lower grade from Crucera.
�As a result of the
lower cash flow in the second quarter we expect that our cash balance, prior to
the additional capital expenditure outlined below, at year end will be
approximately $US 13 million (based on production of 65,750 ounces and a gold
price of $1,625 an ounce) compared with the $US 15 million that we announced in
October. We expect to commit up to $US 4 million of additional capital
expenditure in the second half of the year to accelerate the �pre-strip� of the
San Gregorio extension that had been planned to commence in the next financial
year . We have also incurred additional exploration expenditure to earn our interest
in Pantanillo during the first half and plan, following a positive review of
the project, to complete the initial acquisition of 25% of the Talca asset.
Together with San Gregorio these investments will reduce the expected cash
balance as at 31 May 2013 to approximately $US 8 million.
�Overall, we are
confident that the Company remains on track to successfully deliver the
strategy that was outlined in October 2012.�
Financial Highlights
- Revenue
increased 15 per cent to $US 24.1m for the quarter (Q2 2011: $US 21.0m),
with an average realized gold price of $US 1,694 (Q2 2011: $US 1,717/oz).
- Net
profit after tax for the quarter was $US1.2m (Q2 2011: $US 2.6m). For the
half year net profit after tax was $US3..5m (1H
2011: $US 7.0m).
- Cash
flow from operations for the quarter was $US3.5m (Q2 2011: $US 4.6m) with
$US 8.5m for the half year (1H 2011: $US 10.2m). $US 4.8m was consumed in working capital during the half.
Working capital is expected to be maintained or reduced in the second half
of the current financial year.
- Capital
expenditure for the first half was $US 11.75m. Total capital expenditure
for the year is expected to be $US 24.5m compared to an original budget of
$US 20.5m. The Company is planning to spend up to $US4m in the second half
of the current year to change the mining sequence of San Gregorio to
accelerate pre-strip on this deposit. This will allow the Company to
maintain higher ore stock levels to reduce risk and maximise throughput
and maintain consistent production over the coming years.
- The
Company�s cash balance at 30 November 2012 was $US 3.75m compared to $US
7.2m at 31 August 2012. This is in accordance with previous
guidance. Cash flow from operations and profitability in the second
half is expected to be significantly stronger as higher production levels
are forecast with similar cost levels. The Company�s cash balance is
therefore expected to increase in the second half.
Production Highlights
- Production
for the quarter increased by 17 per cent year on year to 13,970 ounces (Q2
2011: 11,916 ounces). 29,422 ounces were produced for the half year (1H
2011: 24,404), an increase of 20.6 per cent.
- During
the quarter 1.8m tonnes of waste (Q2 11/12 � 1.4m) and 284,880 tonnes of
ore (Q2 11/12 � 232,070) were mined with an average grade of 1.50 g/t (Q2
11/12 � 1.25g/t).
- During
the quarter 385,271 tonnes of ore (Q2 11/12 � 391,686) were fed into the
plant at an average grade of 1.21 g/t (Q2 11/12 � 1.02 g/t) to produce
13,970 ounces of gold (Q2 11/12 � 11,916) with a metallurgical recovery of
93.4% (Q2 11/12 � 92.6%).
- Cash
operating costs for the quarter were $US1,215 per
ounce (Q2 2011: $US1,007). Higher costs were due to lower head grade mined
from the Crucera pit, planned higher stripping costs for the quarter and
Uruguayan inflation and peso exchange rate when compared to the prior
year. Unit mining and processing costs including Arenal Deeps underground
costs were in accordance or below budget.
- Successful
continued development of the ramp at Arenal Deeps with 352 metres
completed during the quarter. The ramp is planned for completion
during January with ore production targeted for the second half of
February when level development for the initial mining levels is complete.
- The
production forecast for the full year remains on track to be in the range
of 63,000 to 68,000 ounces. Production in the second half is expected to
increase as Arenal development will transition from waste to ore, higher
grade Arenal ore will be accessed in the last quarter and Crucera ore
delayed from the first half of the year will be processed in the second
half.
- Cash
cost per ounce for the full year is expected to be in the range of $US1,000 to $US1,065 per ounce, approximately 6 per cent
above the Company�s budget for the year, as a result of the average grade
of ore mined from the Crucera open pit in the first half of the year being
lower than initially expected. Unit
operating costs are in line with budget.
Exploration and Development
Highlights
- Maiden
NI43-101 compliant resource estimate expected at Mahoma in the second half
of fiscal 2013 � expected to support the commencement of feasibility work.
4,530 metres of infill and extension drilling have been completed on the
Mahoma vein project. Best results reported to date for the current
programme include 1.4 meters at 219 g/t, 1.6 meters at 32.1 g/t, 1.4
meters at 36.7 g/t, 3 meters at 20 g/t and 4 meters at 41.2 g/t.
- Company
completed drilling and expenditure commitments on the Pantanillo project
it optioned from Anglo American. During December the Company exercised its
option to acquire the Pantanillo project and now owns the project. Field
work during quarter three will be focused on target generation with no
further drilling planned for this fiscal year.
- Completion
of the previously announced review of the Talca project. The review
identified a number of new areas with potential for discovery of high
grade veins. Company to complete the acquisition of initial 25 per cent
interest during 2013. Upon completion, the Company will have five years to
perform further exploration work without having to make further payments.
A CSMT geophysical survey is planned to test these and existing zones
before further drilling is performed.
- At
Anillo 75 km� of new mapping and 28 trenches were completed during the
quarter. Anomalous Au and Ag values were obtained in the Anillo Central
and South East sectors that suggest the existence of an underlying
hydrothermal cell. A CSMT geophysical survey is planned for the third
quarter with 2,000 meters of drilling in the fourth quarter to test these
targets.
Data and Statistics for these countries : Chile | All Gold and Silver Prices for these countries : Chile | All
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Orosur Mining
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PRODUCER |
CODE : OMI.V |
ISIN : CA6871961059 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Orosur is a gold producing company based in Canada. Orosur holds various exploration projects in Chile and in Uruguay. Its main asset in production is SAN GREGORIO MINE in Uruguay, its main asset in development is ARENAL DEEPS in Uruguay and its main exploration properties are INCAHUASI, ANILLO and PANTANILLO in Chile, NUEVA HELVECIA, MAL ABRIGO AND CERROS NEGROS, LASCANO, ISLA PATRULLA, RIVERA, PASO DE LUGO, CHAMIZO, BRAGADO, MARIA ALBINA, RETAMOSA, CASUPA-CRUCERA, PRESIDENTE TERRA, VOLCADERO, TEXAS - ISLA PATRULLA DISTRICT, ISLA CRISTALINA BELT, CASTRILLÓN, OLD TEXAS, ARROYO POLANCO and CASUPA MADRE in Uruguay and ESTE DE LA ALUMBRERA in Argentina. Orosur is listed in Canada, in Germany and in United Kingdom. Its market capitalisation is CA$ 7.9 millions as of today (US$ 5.8 millions, € 5.4 millions). Its stock quote reached its highest recent level on February 03, 2006 at CA$ 5.96, and its lowest recent point on September 11, 2023 at CA$ 0.04. Orosur has 98 865 201 shares outstanding. |
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