Silver
Standard Reports First Quarter 2009 Results
VANCOUVER, BRITISH
COLUMBIA, May 14, 2009
(Marketwire via COMTEX News Network) -- Silver Standard Resources Inc. (TSX:SSO)(NASDAQ:SSRI)
reports the following principal project updates and financial highlights from
the company's first quarter of 2009. Effective January 1, 2009, the company
adopted the U.S. dollar as its reporting currency and all figures are in U.S.
dollars unless otherwise noted.
Update on Pirquitas
Mine Ramp-up
During the quarter,
Silver Standard completed construction of the silver circuit, advanced
commissioning of the ball mill and delivered ore to the ball mill feed
system. Subsequent to the end of the quarter, the company completed
commissioning of the silver flotation circuit and commenced concentrate
production. Silver concentrate is now being produced and stockpiled for
shipment in May.
At current metal
prices, the silver and tin concentrates account for over 95% of the
anticipated revenue from the mine. As a result, the silver circuit will be
optimized first, followed by the tin circuit. Due to encouraging results from
metallurgical test work, process equipment purchased for the zinc circuit
will be used to enhance silver recoveries and increase the silver content of
the silver concentrate. Consequently, completion of the zinc circuit will be
subject to further evaluation.
Open pit pre-stripping
has been completed and the initial ore has been exposed. Open pit ore is
being stockpiled while the historical jig tailings are fed through the silver
circuit during the second quarter.
With production
ramping up through the second quarter of 2009, Pirquitas is expected to
produce approximately six million ounces of silver in 2009 and achieve full
production in 2010 of approximately 10 million ounces of silver.
As of March 31, 2009,
the company had expended $213.2 million in construction costs of the total
estimated $230 million.
Financial Highlights
- The company reports
a first quarter loss of $2.6 million ($0.04 per share) for the three months
ended March 31, 2009 compared to earnings of $2.3 million ($0.04 per share)
for the first quarter of 2008. The 2008 earnings related primarily to the
gain on the sale of the company's silver bullion offset by financing costs
and investment writedowns.
- For the three months
ended March 31, 2009, Silver Standard incurred $18.4 million for
construction, $14.6 million for pre-operating costs and $2.6 million for
mining equipment at the Pirquitas Mine.
- Significant
exploration expenditures to advance other projects during the quarter
included $1.4 million at the Pitarrilla Project in Mexico; $0.8 million at
the San Luis Project in Peru, and $0.3 million for exploration at the
Diablillos Project in Argentina.
- The company sold 5.8
million common shares at $17.00 per share to the public in the first quarter
which resulted in net proceeds of $93.4 million after fees, commissions and
costs.
- Cash and cash
equivalents increased from $72.0 million at December 31, 2008 to $107.7
million at March 31, 2009.
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Selected Financial Data
($000's, except per share amounts)
This summary of selected financial data should be read in conjunction with
the management discussion and analysis ("MD&A") of the unauditedconsolidated operating results and financial condition of the company for
the three months ended March 31, 2009 and audited results for the year and
quarter ended December 31, 2008.
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Three Months
Ended March 31
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2009 2008
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Earnings (Loss) $ (2,598) $ 2,328
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Earnings (Loss) per share (0.04) 0.04
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Cash used in operating activities (4,006) (8,052)
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Cash generated by financing activities 93,754 137,970
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Cash used in mineral property costs,
property, plant and equipment (49,568) (28,366)
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Financial Position March 31, 2009 December 31, 2008
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Cash and cash equivalents $ 107,723 $ 72,013
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Marketable securities 10,877 10,923
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Current assets - total 123,649 86,814
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Other investments - ABCP 21,187 21,803
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Current assets and ABCP - total 144,836 108,617
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Current liabilities - total 31,209 45,328
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Working capital 92,440 41,486
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Total assets 650,512 567,905
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Principal Project
Updates
San Luis, Ancash, Peru
A total of $764,000
was spent at the San Luis joint venture project in Peru during the quarter
compared to $1,326,000 in the same quarter of the prior year. An updated
resource estimate completed in the fourth quarter of 2008 defined a measured
and indicated resource of 348,100 ounces of gold resources and 9.0 million
ounces of silver resources.
A feasibility study on
placing the project into production is underway and is expected to be
completed in the second quarter of 2009. An environmental impact study has
also been initiated and is scheduled to be completed by the end of 2009. The
joint venture is currently negotiating long-term land access agreements for
the project.
Silver Standard
presently holds a 55% interest in the San Luis Project and has elected to
increase its interest to 70% by completing a feasibility study. Silver
Standard has the right to increase its interest in the San Luis project to
80% by placing the project in production. The remaining joint venture
interest is held by Esperanza Silver Corporation.
Pitarrilla, Durango,
Mexico
A total of $1,417,000
was spent on the Pitarrilla Project in Mexico during the quarter compared to
$3,700,000 in the same quarter of the prior year. Pitarrilla is 100%-owned by
Silver Standard.
Work is well-advanced
on an engineering pre-feasibility study that focuses on the economics of
developing the underground sulphide-associated, base metal and silver
mineralization found at Breccia Ridge. A second study focusing on development
of the potential open pit resources at Breccia Ridge and other satellite
zones is in progress.
Project resources
total 159.9 million ounces of measured silver, 483.7 million ounces of
indicated silver and 82.3 million ounces of inferred silver resources,
placing Pitarrilla among the largest silver discoveries in the last decade. A
ramp has been completed to provide underground drilling stations for the
high-grade silver and base metal mineralization of the Breccia Ridge Zone. This
drilling will be undertaken on completion of the pre-feasibility study. The
portal and more than 1,300 meters of ramp excavation have been completed to
date.
Diablillos, Salta,
Argentina
A total of $286,000
was spent at the wholly-owned, silver-gold Diablillos Project in Argentina
during the quarter compared to $1,271,000 in the same quarter of the prior
year.
During 2007 and 2008,
Silver Standard completed over 17,700 meters of diamond drilling at the
Diablillos Project. The objective of this program was to better define the
inferred resource of 93.8 million ounces of silver resources and 815,000
ounces of gold resources. The company has engaged an independent Qualified
Person as defined in NI 43-101 to prepare an updated resource estimate for
the Diablillos project, which is expected to be completed in the second
quarter of 2009. In addition, a metallurgical program to assess the heap
leaching characteristics of the mineralization at Diablillos is underway. Dependent
on the results of the resource estimate and the metallurgical program, the
company will advance a pre-feasibility study on the economics of developing
the Diablillos project.
Snowfield, British
Columbia, Canada
In February, Silver
Standard reported a significant increase in gold resources at its
wholly-owned Snowfield Project. The increased resource is now comprised of
measured and indicated gold resources totalling 4,362,000 ounces and inferred
gold resources of 14,276,000 ounces using a cut-off grade of 0.5 grams of
gold-equivalent per tonne, as well as significant silver, copper and
molybdenum resources.
A geological review is
underway to assess the potential for expanding the mineralization at
Snowfield and the company's adjacent Sulphurets project. At least 20,000
meters of follow-up drilling is planned for 2009. The property is located 65
kilometres north of the town of Stewart and 20 kilometres southeast of
Barrick's high-grade gold-silver mine at Eskay Creek.
San Agustin, Durango,
Mexico
In February 2009, an
exploration company that had an option to acquire the property elected to not
exercise its option, after expending in excess of $10 million in exploration
on the property. As a result, San Agustin now hosts indicated gold resources
totalling 1.59 million ounces and silver resources of 47.9 million ounces;
and inferred gold resources totalling 1.06 million ounces and silver
resources of 37.0 million ounces. The property has excellent exploration
potential and a geological review is underway, with additional drilling
planned.
Management Discussion
& Analysis and Conference Call
For the full First
Quarter 2009 report, including Management Discussion & Analysis, visit www.sedar.com or the company's web site at www.silverstandard.com. A conference call with management to review First Quarter 2009
financial results and project activities is scheduled on Tuesday, May 19,
2009 at 11:00 a.m. EDT.
Toll-free in North
America: (877) 681-3374
All other calls: (719)
325-4869
This call will also be
web-cast and can be accessed at the following web location:
http://ir.silverstandard.com/eventdetail.cfm?eventid=68755.
The call will be
archived and available at www.silverstandard.com after May 19, 2009.
Audio replay will be
available for one week by calling:
Toll-free in North
America: (888) 203-1112, replay passcode 1942892.
Overseas callers may
dial: (719) 457-0820, replay passcode 1942892.
To receive Silver
Standard's news releases by e-mail, contact Paul LaFontaine, director,
investor relations at invest@silverstandard.com or call (888) 338-0046. The TSX has neither approved nor disapproved
of the information contained herein.
Statements contained
in this news release that are not historical fact, such as statements
regarding the economic prospects of the company's projects, future plans or
future revenues, timing of development or potential expansion or
improvements, are forward-looking statements as that term is defined in the
Private Securities Litigation Reform Act of 1995. Such forward-looking
statements are subject to risks and uncertainties which could cause actual
results to differ materially from estimated results. Such risks and
uncertainties include, but are not limited to, the company's ability to raise
sufficient capital to fund development, changes in economic conditions or
financial markets, changes in prices for the company's mineral products or
increases in input costs, litigation, legislative, environmental and other
judicial, regulatory, political and competitive developments in Canada,
technological and operational difficulties or inability to obtain permits
encountered in connection with exploration and development activities, labour
relations matters, and changing foreign exchange rates, all of which are
described more fully in the company's filings with the Securities and
Exchange Commission.
Cautionary note to
U.S. investors: The terms "measured mineral resource",
"indicated mineral resource", and "inferred mineral
resource" used in this news release are Canadian geological and mining
terms as defined in accordance with National Instrument 43-101, Standards of
Disclosure for Mineral Projects ("NI 43-101") under the guidelines
set out in the Canadian Institute of Mining, Metallurgy and Petroleum (the
"CIM") Standards on Mineral Resources and Mineral Reserves. We
advise U.S. investors that while such terms are recognized and permitted
under Canadian regulations, the SEC does not recognize them. U.S. investors
are cautioned not to assume that any part or all of the mineral deposits in
the measured and indicated categories will ever be converted into reserves. "Inferred
mineral resources" in particular have a great amount of uncertainty as
to their economic feasibility. It cannot be assumed that all or any part of
an inferred mineral resource will ever be upgraded to a higher category. Under Canadian rules
estimates of inferred mineral resources may not generally form the basis of
feasibility or other economic studies. U.S. investors are cautioned not to
assume that any part or all of an inferred mineral resource exists, or is
economically or legally mineable. Disclosure of contained metal expressed in
ounces is in compliance with NI 43-101, but does not meet the requirements of
Industry Guide 7 of the SEC, which will only accept the disclosure of tonnage
and grade estimates for non-reserve mineralization.
(Source: Silver Standard Resources Inc.)
SOURCE: Silver Standard Resources Inc.
Silver Standard Resources Inc.
Robert A. Quartermain
President
(604) 689-3846
Silver Standard Resources Inc.
Paul LaFontaine
Director, Investor Relations
N.A. toll-free: (888) 338-0046 or Direct: (604) 484-8212
invest@silverstandard.com
www.silverstandard.com