Release #20 - 2012
Vancouver, B.C. Monument Mining Limited (TSX-V: MMY and FSE: D7Q1) �Monument� or the �Company� today announces its annual financial results for the year ended June 30, 2012. All amounts are in United States dollars unless otherwise indicated (refer to
www.sedar.com for full annual financial results).
Annual Highlights:* Gross revenue of $61.7 million generated from gold sales of 36,938 ounces at an average price of $1,671 per ounce, 9% increase from 2011 gross revenues;
* Gold production of 44,585 ounces produced at average cash cost of $306 per ounce;
* Positive working capital;
* Net income attributable to shareholders for fiscal 2012 of $59.6 million or $0.33 per share;
* Completion of the Phase III Gold Plant Expansion (�Phase III Expansion�) on time at total cost of approximately $8.7 million increasing capacity of the gold treatment plant from 400,000 tonnes per annum ("tpa") to approximately 1,000,000 tpa;
* Completed Stage II Tailing Storage Facility Enlargement (�TSF Expansion�) at a total cost of approximately $1.7 million to an estimated total tailings storage capacity of 11.0 million tonnes;
* Re-invested in the Mengapur Polymetalic Project located in Pahang State, Malaysia through cash generated from Selinsing Gold Mine
Production Results
| |
Year ended June 30
|
| |
2012 |
2011 |
| Ore mined (tonnes) |
501,881 |
740,909 |
| Ore processed (tonnes) |
364,680 |
351,999 |
| Average mill feed grade (g/t) |
4.24 |
4.31 |
| Processing recovery rate |
93.7% |
92.9% |
| Gold produced (oz) |
44,585 |
44,438 |
| Gold sold (oz) |
36,938 |
40,438 |
| |
|
|
Fiscal 2012 gold production totaled to 44,585oz in line with fiscal 2011 but below expectation of 55,000oz mainly due to lower gold recovery that occurred during ramp up of tonnage through the new primary ball mill, downtime caused by commissioning of the phase III plant expansion, and transformation from oxide ore to transition (mixed) ore and plant changeover to better process sulfide ore.
Mine Development The Company completed the TSF Expansion at $1.7 million and the Phase III Expansion at $8.7 million in December 2011 and June 2012 respectively. These increased the capacity of from 400,000 tpa to approximately 1,000,000 tpa and the TSF storage capacity from 6.4 million tonnes to 11 million tonnes. The TSF storage capacity will support 10 years of tailings discharge from the newly expanded gold processing plant through the Phase III Expansion. On August 16, 2012, the Company announced that the Phase III Expansion was placed into commercial production. The total capital cost of this expansion was paid for with cash flow from production.
Financial Results and Discussion
| |
|
Year ended June 30
|
| |
|
2012 |
2011 |
| |
Revenue (in 000's) ⁽1⁾ |
$61,709 |
$56,627 |
| |
Income before other items (in 000�s) |
$40,553 |
$35,467 |
| |
Earnings per Share (Basic) before other income |
$0.22 |
$0.21 |
| |
Net income attributable to shareholders (in 000�s) |
$59,561 |
$32,392 |
| |
Earnings per Share (Basic) |
$0.33 |
$0.19 |
| |
Cash flow from operations (in 000�s) |
$43,268 |
$38,867 |
| |
Working capital excluding derivative liabilities (in 000�s) |
$31,131 |
$63,407 |
| Cash cost (US$/oz.) ⁽�⁾ |
|
|
| Mining |
54 |
53 |
| Processing |
140 |
120 |
| Royalties |
107 |
69 |
| Operations, net of silver recovery |
5 |
- |
| Total cash cost (US$/oz) |
306 |
242 |
| |
|
|
|
(1) $4,247 of $56,627 was recorded against the construction.
(2) Total cash cost includes production costs such as mining, processing, tailing facility maintenance and camp administration, royalties, and operating costs such as storage, temporary mine production closure, community development cost and property fees, net of by-product credits. Cash cost excludes amortization, depletion, accretion expenses, capital costs, exploration costs and corporate administration costs.
The revenue increase in fiscal 2012 resulted from a higher average realized gold price of $1,671 per ounce compared to $1,400 per ounce in fiscal 2011, offset by a decrease of gold sold due to timing. The increase of cash cost per ounce from $242 per ounce to $306 per ounce was mainly driven by the increase of processing cost which mainly resulted from the newly built detox plant, interruptions caused by Phase III and a small quantity of sulfide materials milled during the fourth quarter. Royalty cost per ounce was increased due to the royalty payment for the restricted gold produced in previous year which was not required to be paid at the time.
The fiscal 2012 net income attributable to shareholders was $59.6 million, or $0.33 per share (basic) compared to $32.4 million, or $0.19 per share (basic) in fiscal 2011. The increase in earnings per share in fiscal 2012 is mainly due to other income (loss) which attributed $0.10 to earnings per share as compared to ($0.02) per share in fiscal 2011. The significant increase in other income was caused by derivative gains resulted in change of fair value of derivative liabilities at the end of the reporting period. Derivative liabilities are estimated based on selected financial models and assumptions associated to related commodity price or share price at the market as required by IFRS, the applicable accounting standards, and may have significant effect on the amounts recognized in the financial statements that need to be evaluated at each reporting period with a nature of uncertainty.
The increase of Cash flow from operations mainly resulted from higher revenue in fiscal 2012. The decrease of working capital excluding derivative liabilities was mainly caused by using cash on hand to complete the acquisition of the Mengapur project in fiscal 2012.
AcquisitionsDuring fiscal 2012 the Company completed new acquisitions, significantly growing its asset base and serving as a stepping stone for business expansion and diversification of its current portfolio.
In September 2011, the Company acquired 49% of Mersing Gold Project with the right to earn up to 100% interest. The Mersing Gold project is about 300km southeast of the Selinsing Gold Mine has potential to host primary gold mineralization.
In November 2011 the Company acquired 100% of Star Destiny Sdn. Bhd., which holds an exploration prospecting permit for a 750 hectare property in Pahang State, Malaysia. It is adjacent to the west and south of the Mengapur mining lease held by Cermat Aman Sdn. Bhd. in which the Company acquired a 70% interest in February, 2012. Both properties together form the entire Mengapur Polymetalic Project containing the Mengapur polymetalic historic ore body. The Star Destiny Prospecting Permit expired on 23 September 2012. An application for renewal was filed by the permit holder in November 2011 as required by the Malaysian Mineral Enactment 2001. The Company has also applied for three Mining Licenses over the prospecting permitting area in 2009, 2010 and 2012.
Exploration Progress During the year ended June 30, 2012, the Company drilled 14,245 meters at Selinsing and Buffalo Reef focusing on converting the current inferred gold resources to NI 43-101 compliant measured and indicated reserves and also increasing the total resources on those properties to support sustainable gold production going forward. The Selinsing drilling program focused on definition drilling and metallurgy testing of the Selinsing Deeps area below the ultimate open-pit mine plan (400.0m RL elevation). The drill program at Buffalo Reef focused on definition drilling of the north, south and central areas and metallurgical testing. The in-house drill team greatly increased its productivity as a result of coaching programs provided in the first half of the year. The company is presently expecting a new 43-101 compliant resource statement from its consultants. Upon receipt the company will release a news release and be able to project its future gold production program based on its measured and indicated resources.
Fiscal 2012 drilling at Mengapur Project was designed to determine the continuity of mineralization, explore untested areas and to test deeper mineralization targets below the proposed pit shells. As of June 30, 2012, 74 drill holes totaling 13,876m were completed.
GrowthAs of June 30, 2012, the Company employed 258 people at its Malaysian operations, an increase of 62 or 32% over the year ended June 30, 2011. Of those, 255 are Malaysian. Most are hired locally and live in the surrounding communities with their families.
During and subsequent to June 30, 2012 the company appointed a number of key personnel including an additional board member, Chief Operating Officer, Vice President-Business Development, Vice President-Exploration, and Senior Managers for security and the processing plant located in Malaysia and a senior manager of Investor relations.
Outlook�Fiscal 2012 was a year of expansion and diversification as we move towards building a mid-tier mineral resource Company with our expanded property portfolio�, stated President and CEO Robert Baldock. �Our skilled management team is now focusing on developing the Mengapur project, continuing to explore Buffalo Reef and Selinsing to increase NI 43-101compliant reserves resources and commencing mining at Buffalo Reef, resulting in Company growth and aimed at an increased market capitalization. At the same time the Company has been building internal technical and management capability in order to achieve and sustain these growth ambitions.�
About Monument Monument Mining Limited (TSX-V:MMY, FSE:D7Q1) is an established Canadian gold producer that owns and operates the Selinsing Gold Mine in Malaysia, with production cash costs among the lowest in the world. Its experienced management team is committed to growth and is advancing several exploration and development projects in Malaysia, including the feasibility stage, Mengapur Polymetalic Project. The Company employs 260 people in Malaysia and is committed to the highest standards of environmental management, social responsibility, and health and safety for its employees and neighboring communities.
Robert F. Baldock, President and CEO
Monument Mining Limited
Suite 910- 688 West Hastings Street
Vancouver B.C. Canada V6B 1P1