Semafo Reports Net Earnings of $11.3 Million for the Third Quarter 2008
Record Gold Production and Cash Flow from Operations
Montreal, Quebec, November 11, 2008 � SEMAFO (TSX: SMF) today reported record financial and operational results for the three-month period ended September 30, 2008. All amounts are in US dollars unless otherwise stated.
Highlights
Semafo, for a third consecutive quarter, delivered record results during the three-month period ended September 30, 2008. Gold production totaled 55,300 ounces, a 170% increase over the corresponding period in 2007. Cash flow from operating activities totaled $20,068,000, compared to $859,000 for the same period last year. Highlights for the second quarter include:
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Gold production of 55,300 ounces
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Cash flow from operating activities of $20,068,000
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Gold sales of $51,147,000 at an average selling price of $864 per ounce
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Operating income of $11,959,000
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Net income of $11,366,000
-
Total cash cost of $475 per ounce
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Cash operating cost of $456 per ounce
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Sccessful commissioning of the 4,000 tonne-per-day ball mill at Mana
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Ahievement of specific milestones of the Mana construction credit facility
A Word from the CEO
Semafo successfully delivered another solid operational and financial performance during the third quarter of 2008.
Operationally, we achieved record production in Q3 with a total of 55,300 ounces of gold. Operating costs increased moderately during the third quarter mainly due to the historically high cost of fuel and reduced head grades. Despite these impediments, Semafo�s total cash cost of $475 per ounce remained below industry average.
Financially, the Company achieved a record cash flow from operations of $20,068,000 for the quarter. The average selling price of gold was $864 per ounce during the period, which resulted in an operating income of $11,959,000.
While pleased to be well-positioned in such a challenging economic environment, our priority remains the diligent management and operation of our three gold mines such that they continue to generate significant cash flow.
Semafo remains committed to increase shareholder value via the effective management of our existing assets and the pursuit of opportunities that may arise in West Africa.
Financial and Operating Highlights
|
|
Three-month period
ended September 30 |
Nine-month period
ended September 30 |
|
|
2008 |
2007 |
Variation |
2008 |
2007 |
Variation |
|
Operating Highlights |
|
|
|
|
|
|
|
Gold ounces produced............................................................... |
55,300 |
20,500 |
170% |
138,600 |
79,700 |
74% |
|
Gold ounces sold......................................................................... |
59,200 |
24,000 |
147% |
137,000 |
79,600 |
72% |
|
(In thousands of dollars, except amounts per ounce and per tonne) |
|
|
|
|
|
|
Revenues � Gold sales.............................................................. |
51,147 |
16,314 |
214% |
121,513 |
53,026 |
129% |
|
Operating costs ........................................................................... |
28,119 |
14,901 |
89% |
67,830 |
43,129 |
57% |
|
Operating income (loss) ............................................................ |
11,959 |
(3,910) |
406% |
28,582 |
(5,879) |
586% |
|
Net income (loss)........................................................................ |
11,366 |
(10,317) |
210% |
35,549 |
(15,633) |
327% |
|
Average selling price (per ounce)............................................ |
864 |
680 |
27% |
887 |
666 |
33% |
|
Cash operating cost (per ounce produced) 1......................... |
456 |
504 |
(10%) |
447 |
473 |
(5%) |
|
Cash operating cost (per tonne processed) 1......................... |
35 |
27 |
30% |
33 |
26 |
27% |
|
Total cash cost (per ounce sold) 2............................................. |
475 |
514 |
(8%) |
495 |
503 |
(2%) |
1 Cash operating cost is calculated using ounces produced and tonnes processed. See the section ��Non-GAAP measures�� of the MD&A.
2 Total cash cost represents the cash operating cost plus royalties and selling expenses and also the effects of inventory adjustments.
Outlook
In October 2008, overall production totaled 19,400 ounces of gold; 10,000 ounces at Mana, 4,900 ounces at Samira Hill and 4,500 ounces at Kiniero.
Management anticipates ongoing stable production during the fourth quarter and accordingly, production guidance has been increased from the initial forecast of between 165,000 and 185,000 to between 185,000 and 195,000 ounces of gold for 2008.
A conference call will be held at 10:00 a.m. on Wednesday, November 12, 2008 to discuss the Company�s quarterly results. Details to access the call can be found on the home page of the Company�s website at www.semafo.com. Semafo�s consolidated financial statements, together with Management�s Discussion and Analysis, are available on its website or at www.sedar.com.
About SEMAFO
Semafo is a Canadian-based mining company with gold production and exploration activities in West Africa. The Company currently operates three gold mines in Burkina Faso, Niger and Guinea. Semafo is committed to evolve in a conscientious manner to become a major player in its geographical area of interest, while maintaining principles and strengthening relationships to increase shareholder value.
FORWARD-LOOKING STATEMENTS
This press release may contain forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding expectations of the Company as to the market price of gold, strategic plans, future commercial production, production targets, timetables, mining operating expenses, capital expenditures, and mineral reserve and resource estimates. Forward-looking statements involve known and unknown risks and uncertainties and accordingly, actual results and future events could differ materially from those anticipated in such statements. Factors that could cause future results or events to differ materially from current expectations expressed or implied by the forward-looking statements include, but are not limited to, fluctuations in the market price of precious metals, mining industry risks, uncertainty as to calculation of mineral reserves and resources, risks related t o hedging strategies, risks of delays in construction, requirements of additional financing and other risks described in the Company�s documents filed from time to time with Canadian securities regulatory authorities. Although the Company is of the opinion that these forward-looking statements are based on reasonable assumptions, those assumptions may prove to be incorrect. Accordingly, readers should not place undue reliance on forward-looking statements. Readers can find further information with respect to risks in the Annual Information Form of the Company and other filings of the Company with Canadian securities regulatory authorities available at www.sedar.com. The Company disclaims any obligation to update or revise these forward-looking statements, except as required by applicable law.
For more information contact:
SEMAFO:
Benoit La Salle,
President & CEO
Tel: (514) 744-4408
E-Mail : blasalle@semafo.com
Sofia St Laurent
Communications
Tel: (514) 744-4408
E-Mail : sstlaurent@semafo.com
Renmark Financial Communications Inc.
Maurice Dagenais : mdagenais@renmarkfinancial.com
Victoria Stepanova : vstepanova@renmarkfinancial.com
Montreal:
Tel.: (514) 939-3989
Fax: (514) 939-3717
www.renmarkfinancial.com |
Toronto:
Tel.: (416) 644-2020
Fax: (416) 644-2021
|
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