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High River Gold Reports Second Quarter 2011 Results
Published : August 15, 2011
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TORONTO, ONTARIO--(Marketwire - Aug. 15, 2011) -

(All currency figures are in Canadian dollars unless otherwise noted)

High River Gold Mines Ltd. ("High River" or the "Company") (News - Market indicators) today reported its financial results and operational highlights for the three month period ended June 30, 2011. The Unaudited Interim Consolidated Financial Statements and related Notes along with the Management's Discussion and Analysis have been filed with SEDAR (www.sedar.com) and can be viewed on the Company's website at www.hrg.ca

HIGHLIGHTS FOR THE SECOND QUARTER 2011

Financial Results

  • Net gold revenue of $136.2 million, an increase of 11% from $122.4 million in Q1 2011, an increase of 20% from $113.8 million in Q2 2010.
  • Net income of $41.4 million ($0.05 per share) compared to a net income of $37.3 million ($0.04 per share) in Q1 2011 and a net income of $37.5 million ($0.05 per share) in Q2 2010.
  • Cash flow from operations of $42.9 million, down from $53.5 million in Q1 2011, and down from $48.8 million in Q2 2010.
  • Cash and cash equivalents increased to $207.2 million from $204.1 million at the end of Q1 2011, and up from $92.7 million at the end of Q2 2010.
  • Working capital increased to $307.2 million from $287.0 million at the end of Q1 2011 and from $150.9 million at the end of Q2 2010.
  • Current and long term debt increased to $24.0 million from $23.5 million at the end of Q1 2011 and decreased from $31.5 million at the end of Q2 2010.
  • In June 2011, High River agreed to settlement terms with its former contractor in respect of a previously disclosed action brought against Somita. As previously disclosed, a claim regarding services which were delivered to Somita was filed against Somita before an arbitrator in South Africa in 2009. The aggregate amount of the claim was US$3.7 million and High River filed a statement of defense and counterclaim for damages. The settlement agreement provides for full and final settlement of the contractor's claim against Somita for a settlement amount of US$1.35 million.

Operations

  • Total gold production increased 5% to 96,093 (Q1 2011 – 91,756) ounces (100%). Total cash cost per ounce increased 25% to US$704 (Q1 2011 – US$560 per ounce).
  • The Zun-Holba and Irokinda Gold Mines produced 33,594 ounces (Q1 2011 – 31,855) (100%) at a total cash cost of US$778 per ounce.
  • The Taparko-Bouroum Gold Mine produced 33,753 ounces (Q1 2011 – 36,456) (100%) at a total cash cost of US$556 per ounce. 
  • Gold production at Berezitovy was 28,746 ounces (Q1 2011 – 23,445 ounces) (100%) at a total cash cost of US$792 per ounce.
  • High River's subsidiary in Burkina Faso, Bissa Gold S.A. ("Bissa Gold"), was granted the mining license for the Bissa Gold Project by the governmental authorities of Burkina Faso for a term of 20 years with a possibility of renewal. Bissa Gold has engaged the EPCM (Engineering, Procurement, and Construction Management) contractor and the ball mills supplier for the Project.

Subsequent Events

  • In July 2011, Bissa Gold engaged the mining fleet supplier and power plant constructor for the Bissa Gold Project.

DISCUSSION OF FINANCIAL RESULTS

Selected Financial Results

The Company reported a net income of $41.4 million ($0.05 per share) in Q2 2011 compared to a net income of $37.3 million ($0.04 per share) during Q1 2011 and net income of $37.5 million ($0.05 per share) in Q2 2010.

In thousands of Canadian dollars Three months ended Six months ended
(except per share amounts) June 30, 2011 June 30, 2010 June 30, 2011 June 30, 2010
Gold revenue $ 136,204 $ 113,808 $ 258,566 $ 211,464
Net income (loss)   41,375   37,456   78,674   67,877
Net income (loss) per share (basic)   0.05   0.05   0.09   0.08
Cash provided by (used in) operating activities   42,893   48,800   96,410   80,299
Weighted average number of shares outstanding (basic)  
840,218,962
 
799,327,755
 
840,218,962
 
799,327,755

About High River

High River is an unhedged gold company with interests in producing mines, development and advanced exploration projects in Russia and Burkina Faso. Two underground mines, Zun-Holba and Irokinda, are situated in the Lake Baikal region of Russia. Two open pit gold mines, Berezitovy in Russia and Taparko-Bouroum in Burkina Faso, are also in production. Finally, High River has a 90% interest in a development project, the Bissa gold project in Burkina Faso, and a 50% interest in an advanced exploration project with NI 43-101 compliant resource estimates, the Prognoz silver project in Russia.

FORWARD LOOKING INFORMATION

This release and subsequent oral statements made by and on behalf of the Company may contain forward-looking statements. Wherever possible, words such as "intends", "expects", "scheduled", "estimates", "anticipates", "believes", and similar expressions or statements that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, have been used to identify these forward-looking statements. Although the forward-looking statements contained in this release reflect management's current beliefs based upon information currently available to management and based upon what management believes to be reasonable assumptions, High River cannot be certain that actual results will be consistent with these forward-looking statements. A number of factors could cause events and achievements to differ materially from the results expressed or implied in the forward-looking statements. These factors should be considered carefully and prospective investors should not place undue reliance on the forward-looking statements. Forward-looking statements necessarily involve significant known and unknown risks, assumptions and uncertainties that may cause High River's actual results, events, prospects and opportunities to differ materially from those expressed or implied by such forward-looking statements. Although High River has attempted to identify important risks and factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors and risks that cause actions, events or results not to be anticipated, estimated or intended, including those risk factors discussed in the Company's 2010 Annual Information Form. There can be no assurance that the forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, prospective investors should not place undue reliance on forward-looking statements. Any forward-looking statements are made as of the date of this release, and High River assumes no obligation to update or revise them to reflect new events or circumstances, unless otherwise required by law.

High River Gold Mines Ltd.  
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION  
As at June 30, 2011  
(Unaudited, expressed in thousands of Canadian Dollars)  
         
    June 30,
2011
December 31,
2010
 
ASSETS      
Current Assets      
  Cash & cash equivalents 207,264 153,964  
  Restricted cash 2,179 1,285  
  Inventories 124,104 97,663  
  Trade and other receivables 22,003 13,639  
  Other assets 18,862 15,589  
    374,412 282,140  
Non-Current Assets      
  Exploration and evaluation assets 124,202 119,847  
  Mine properties 71,428 67,436  
  Property, plant & equipment 183,912 190,256  
  Available for sale financial assets 98,116 109,633  
  Other assets 28,599 7,986  
  Deferred tax asset 5,080 1,596  
    511,337 496,753  
TOTAL ASSETS 885,749 778,893  
         
LIABILITIES      
Current Liabilities      
  Accounts payable and accrued liabilities 37,268 33,905  
  Loans and other borrowings 12,826 22,686  
  Finance Leases 243 607  
  Income tax payable 16,873 19,787  
    67,210 76,985  
Non-Current Liabilities      
  Other liabilities 833 696  
  Derivative financial liabilities   -  
  Loans and other borrowings 10,397 1,732  
  Provisions 21,147 19,067  
  Deferred tax liabilities 37,619 23,595  
    69,995 45,090  
TOTAL LIABILITIES 137,205 122,075  
         
EQUITY      
  Share Capital 640,157 640,157  
  Warrants   -  
  Contributed surplus 24,538 24,538  
  Debenture conversion option 538 538  
  Other comprehensive income 4,819 3,023  
  Retained Earnings/Deficit 32,906 (45,768 )
  Equity attributable to equity holders of the Company 702,959 622,488  
  Non-controlling interest 45,585 34,330  
TOTAL EQUITY 748,544 656,818  
TOTAL LIABILITIES AND EQUITY 885,749 778,893  
   
   
High River Gold Mines Ltd.  
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME  
for the three months ended June 30, 2011  
(Expressed in thousands of Canadian Dollars)  
         
  Three months ended   Six months ended  
  June 30, 2011   June 30, 2010   June 30, 2011   June 30, 2010  
Revenue                
Gold 136,204   113,808   258,567   211,464  
Silver 2,902   1,388   4,902   2,211  
  139,106   115,196   263,469   213,675  
Cost of sales (75,851 ) (60,076 ) (130,356 ) (115,098 )
Gross Profit 63,255   55,121   133,113   98,578  
                 
                 
Exploration expenses 4,036   (1,892 ) -   (3,152 )
General and administrative expenses (3,686 ) (4,077 ) (8,142 ) (7397 )
Other expenses (5,236 ) (4,239 ) (9,044 ) (4,004 )
Interest income 1,251   663   3,022   893  
Finance costs (485 ) (2,969 ) (2,491 ) (7,055 )
Change in fair value of derivative     3,171       7,000  
Profit before income taxes 59,135   45,777   116,458   84,862  
Income tax expense (14,106 ) (5,899 ) (26,529 ) (11,936 )
Profit for the period 45,029   39,878   89,930   72,926  
                 
Attributable to:                
Non-controlling interest 3,653   2,422   11,255   5,049  
Equity shareholders of the Company 41,375   37,456   78,674   67,877  
Profit for the period 45,029   39,878   89,930   72,926  
                 
Other Comprehensive Income (loss)                
Net gains on available for sale financial assets (9,846 ) 9,353   (1,923 ) 9,206  
Exchange differences on translation of foreign operations (74,582 ) (11,390 ) (57,380 ) (24,252 )
                 
Other comprehensive income, net of tax (84,428 ) (2,037 ) (59,303 ) (15,046 )
                 
Attributable to:                
Non-controlling interest 3,653   2,422   11,255   5,049  
Equity shareholders of the Company (43,052 ) 35,419   19,372   52,831  
Comprehensive Income, net of tax (39,399 ) 37,841   30,627   57,880  
   
   
High River Gold Mines Ltd.  
CONSOLIDATED STATEMENT OF CASH FLOWS  
(Expressed in thousands of Canadian Dollars)  
(Unaudited) Six months ended  
OPERATING ACTIVITIES June 30 2011   June 30 2010  
  Profit after income taxes 89,930   72,926  
  Adjustments to profit for non-cash items        
    Depreciation of property, plant and equipment 28,397   31,254  
    Accretion expense 952   931  
    Write-down of exploration (175 ) 628  
    Loss/(gain) on disposal of investments (432 ) -  
    Non-cash mining costs (1,526 ) (11,776 )
    Fair value adjustment to financial instruments -      
    Share based payment expense -   89  
    Interest on capital lease -   30  
    Gain/loss on disposal of property, plant and equipment (601 ) 153  
    Deferred tax expense 10,420   1,011  
    Other non-cash items 12,679   (1,450 )
  Working Capital Adjustments        
    Change in trade receivable and other assets (6,845 ) 4,359  
    Change in inventories (26,441 ) (10,001 )
    Change in other assets (5,499 ) (3,473 )
    Change in accounts payable and accrued liabilities 2,994   (7 )
  Income Tax Paid (7,436 ) (4,375 )
NET OPERATING CASH FLOWS 96,416   80,299  
             
INVESTING ACTIVITIES        
  Investment in exploration and evaluation assets (21,546 ) (4,635 )
  Expenditure on property, plant and equipment (15,937 ) (13,222 )
  Allocation of restricted cash (895 ) (238 )
  Proceeds on sale of property, plant and equipment 1,273   542  
NET INVESTING CASH FLOWS (37,104 ) (17,553 )
             
FINANCING ACIVITIES        
  Payments of loans and borrowings (10,283 ) (52,674 )
  Joint venture repayment of Prognoz contribution 18,885   -  
  Other Financing activities (16,726 ) -  
  Proceeds from exercise of share options -   217  
NET FINANCING CASH FLOWS (8,124 ) (52,457 )
             
Increase (decrease) in cash and cash equivalents 51,188   10,289  
Net foreign exchange difference 2,113   381  
Cash and cash equivalents, beginning of the period 153,964   82,061  
Cash and cash equivalents, end of the period 207,264   92,731  


High River Gold Mines Ltd.
Konstantin Sobolevskiy
CEO
011 7 495 981 0910 ext. 6676
info@hrg.ca
www.hrg.ca
Data and Statistics for these countries : Burkina Faso | Russia | South Africa | All
Gold and Silver Prices for these countries : Burkina Faso | Russia | South Africa | All

High River Gold Mines Ltd.

PRODUCER
CODE : HRG.TO
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High River Gold is a gold producing company based in Canada.

High River Gold produces gold, silver in Burkina Faso and in Russia, develops gold in Burkina Faso, and holds various exploration projects in Burkina Faso.

Its main assets in production are BURYATZOLOTO (ZUN-HOLMA), BEREZITOVY, SOMITA and IROKINDA in Russia and TAPARKO in Burkina Faso, its main asset in development is BOUROUM in Burkina Faso and its main exploration properties are NOVOPHIRSOVSKOYE and PROGNOZ in Russia and BISSA GOLD in Burkina Faso.

High River Gold is listed in Canada, in Germany and in United States of America. Its market capitalisation is CA$ 1.2 billions as of today (US$ 1.1 billions, € 882.8 millions).

Its stock quote reached its highest recent level on March 07, 2008 at CA$ 3.50, and its lowest recent point on November 14, 2008 at CA$ 0.04.

High River Gold has 840 219 000 shares outstanding.

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Annual reports of High River Gold Mines Ltd.
2007 Annual Report
2006 Annual Report
2005 Annual Report
Financings of High River Gold Mines Ltd.
12/2/2009Closing of Private Placement
6/19/2009Announces Closing of Private Placement and Update on TSX Del...
Nominations of High River Gold Mines Ltd.
1/24/2013Announces Change to the Board of Directors
5/15/2012Announces Appointment of Chief Executive Officer and Chief F...
3/5/2012Announces Resignation of Chief Executive Officer
12/10/2009Appointment to the Board of Directors and the Audit Committe
10/21/2009 Appointment of Chief Executive Officer
9/30/2009Announces Appointment of New Board Member
Financials of High River Gold Mines Ltd.
8/14/2012Financial Results for the Second Quarter Ended June 30, 2012
5/16/2012Financial Results for the First Quarter Ended March 31, 2012
2/24/2012Announces Release of Nord Gold Financial Statements
8/15/2011Reports Second Quarter 2011 Results
8/13/2010Reports Second Quarter 2010 Results
5/13/2010Reports First Quarter 2010 Results
8/15/2009Reports Second Quarter 2009 Results
12/18/2008Reports Third Quarter 2008 Results
Project news of High River Gold Mines Ltd.
1/22/2013Announces Production Results for Q4 2012
10/11/2012Announces Production Results for Q3 2012
7/18/2012Announces Production Results for Q2 2012
4/24/2012Announces Production Results for Q1 2012
1/18/2012Announces Preliminary Production Results for 2011
7/4/2011(Bissa Gold)Announces the Granting of Mining License for Bissa Gold Proj...
2/18/2011(Prognoz)Provides an Update on the Bankruptcy Procedures of Prognoz S...
1/31/2011(Berezitovy)Reports Updated Resource and Reserve Statements
1/31/2011(Taparko)Reports Updated Resource and Reserve Statements
1/31/2011(Bouroum)Reports Updated Resource and Reserve Statements
1/31/2011(Bissa Gold)Reports Updated Resource and Reserve Statements
1/28/2011(Taparko)Announces Release of Royal Gold Security
9/11/2009(Irokinda)Reports Two Accidental Deaths at Irokinda Mine
6/22/2009(Bissa Gold)Reports Updated NI 43-101Compliant Resource Estimate for Bis...
12/4/2008(Prognoz)Advises That Closing of Prognoz Acquisition Not Extended and...
11/10/2008(Taparko)Re-Starts Mill at Taparko-Bouroum and Provides Update on Str...
9/30/2008(Prognoz)Advises That Closing of Prognoz Acquisition Transaction Has ...
3/31/2008(Taparko)2008 Technical report
7/11/2007Discovers New High Grade Gold Zone at Simkar
5/1/2007Announces New Acquisition in Southeastern Peru, Vetaspata --...
3/28/2007High Grade Gold intersected at Quintana Gold Mine, Colombia ...
Corporate news of High River Gold Mines Ltd.
3/13/2013Nord Gold N=2EV=2E and High River Gold Min
12/11/2012Acknowledges Expiry of Offer by Nord Gold
10/31/2012Mails Directors' Circular; Board Recommends Shareholders Acc...
10/22/2012Acknowledges Bid by Nordgold; Advises Shareholders to Wait f...
9/27/2012Announces Updated Reserve and Resource Estimate and Files Te...
7/31/2012Provides Update on Nord Gold Offer
7/20/2012Announces Amended and Restated AIF and Amended Technical Rep...
7/18/2012Responds to Nord Gold Press Release and Establishes Special ...
6/8/2012(Berezitovy)Files Technical Reports for Berezitovy and Burkina Faso Prop...
5/24/2012Announces Date of Annual General Meeting
4/24/2012(Berezitovy)Announces Updated Reserve and Resource Estimates for Berezit...
4/13/2012Second Default Status Report
3/31/2012Reports 2011 Results
3/28/2012First Default Status Report
3/1/2012Announces Default Pursuant to National Policy 12-203
2/24/2012(Prognoz)Provides an Update on the Bankruptcy Procedures of Prognoz S...
12/29/2011(Berezitovy)Announces Amended Q2 2011MD&A and Berezitovy Technical Repor...
9/2/2011(Prognoz)Provides an Update on the Bankruptcy Procedures of Prognoz S...
6/7/2011Reaches Settlement With Senet CC
1/24/2011Shareholders Approve Continuing to Yukon
6/8/2010Announces the Beginning of the Bankruptcy Procedures of Prog...
5/28/2010Announces Change to the Board of Directors and Inclusion in ...
4/20/2010Reports 2009 Results
4/14/2010First Default Status Report
4/1/2010Late Filing of Annual Filings and Provides Operational and F...
12/1/2009Clearance of PIF in Connection With CDN$57 Million Financi
11/3/2009Announces Change of Auditor
10/27/2009Announces Proposed $57 Million Financing
10/8/2009Change to the Board of Directors
9/23/2009 Change to the Board of Directors
9/21/2009 Resignation of Chief Executive Officer
9/15/2009Announces New Investor Relations Contact
9/1/2009Announces Resignation of VP Exploration
7/23/2009New Chief Financial Officer
7/16/2009Provides Q2/2009 Update on Operations and Financial Status
6/26/2009Mailing of Offer
6/17/2009Enters Into Support Agreement With Severstal
6/9/2009Provides Update on Improved Severstal Offer and Announces Pr...
5/22/2009Provides Update on Strategic Alternatives
5/19/2009Provides Update on Operations and Financial Status
3/6/2009Provides Update on Operations
2/2/2009Provides Update on Operations
1/2/2009Provides Update on Operations, Financial Status, and Personn...
12/14/2008Second Default Status Report
12/1/2008First Default Status Report
11/19/2008Announces Late Filing of Interim Financial Statements
9/22/2008Comments on Share Price Decline
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TORONTO (HRG.TO)FRANKFURT (HRG.F)
1.39+0.72%1.03+0.49%
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24hGold TrendPower© : -8
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