MONTREAL, QUEBEC--(Marketwired - May 13, 2013) - Dynacor Gold Mines Inc. (TSX: DNG) (Dynacor or the Company) a company with gold ore processing operations and exploration projects in Peru, has released its unaudited condensed interim consolidated financial statements for the three-month period ended March31, 2013. The Company is pleased to report that for Q1-2013, it recorded a net income of $3.0 M ($0.08 per share) compared to $1.7 M ($0.05 per share) in Q1-2012 and cash flow from operating activities before changes in working capital items of $3.1 M ($0.09 per share) compared to $2.0 M ($0.06 per share) in Q1-2012.
The unaudited condensed interim consolidated financial statements along with the management's discussion and analysis "MD&A" are available on the Company's website www.dynacor.com and the documents have been filed electronically with SEDAR at www.sedar.com.
All figures in this press release are in millions of US$ except where noted. Earnings per share and gross operating margin per ounce are in US$.
Q1-2013 HIGHLIGHTS
- Sales of $33.3 M compared to $23.6M in Q1-2012 a 41.1% increase over Q1-2012;
- Net income of $3.0M in Q1-2013 ($0.08 per share) compared to $1.7M ($0.05 per share) in Q1-2012;
- EBITDA(3) of $4.6M compared to $2.9M in Q1-2012;
- Operating income of $4.3M compared to $2.6M in Q1-2012 a 65.4% increase over Q1-2012;
- Cash flow from operating activities before change in working capital items of $3.1M ($0.09 per share)(1) in Q1-2013 compared to $2.0M ($0.06 per share)(1) a 50% increase over Q1-2012;
- 18,677 DMT (dry metric tonne) processed (17,558 DMT in Q1-2012) a 6.4% increase over Q1-2012;
- Record quarterly production of 20,027 ounces of gold produced (13,111 ounces in Q1-2012) a 52.8% increase over Q1-2012;
- Gross operating margin per ounce(2) of gold sold of $283 compared to $282 in Q1-2012;
- Start of exploration program at Tumipampa in December 2012 which ran throughout the period;
| (1) Cash-flow per share is a non-GAAP financial performance measure with no standard definition under IFRS. It is therefore possible that this measure could not be comparable with a similar measure of another company. The Company uses this non-GAAP measure which can also be helpful to investors as it provides a result which can be compared with the Company market share price. |
| |
| (2) Cash gross operating margin per ounce is calculated by subtracting the average cash cost of sale from the average selling price and is a non-GAAP financial performance measure with no standard definition under IFRS. It is therefore possible that this measure could not be comparable with a similar measure of another company. The Company uses this non-GAAP measure which can also be helpful to investors as it provides a result on a production unit basis. |
Results from operations:
During Q1-2013, the Company achieved an historical quarterly best production of 20,027 ounces of gold an increase of 7.7% from the previous quarter and of 52.8% over the Q1-2012 production of 13,111 ounces. Furthermore, the production growth trend continued as Dynacor generated a record-breaking month in March, producing 7,119 ounces. The increase in production compared to Q1-2012 is due to higher than expected ore grades which was supplied at the Company's Huanca (Acari) processing plant during the period. The average gold grade for Q1-2013 was 1.14 oz/DMT compared to 0.79 oz/DMT in Q1-2012 an increase of 44.3% which explains the important increase of gold produced.
During the period, the Company's plant operated at its full capacity of 220 tpd processing 18,677 DMT of ore compared to 17,558 in Q1-2012.
Total sales in Q1-2013, amounted to $33.3 M including $0.9 M in silver sales compared to $23.6 M including $1.3 M in silver in Q1-2012 a total increase of 41.0%.
The gross operating margin for the period amounted to $5.6 M (16.9%) compared to $3.7 M (15.8%) in Q1-2012.
1- FINANCIAL HIGHLIGHTS
| |
For the three-month periods ended March 31, |
|
| (in $'000) |
2013 |
2012 |
|
| Sales |
33,342 |
23,644 |
|
| Cost of sales |
27,700 |
19,911 |
|
| Gross operating margin |
5,642 |
3,733 |
|
| General and administrative expenses |
830 |
736 |
|
| Operating income |
4,286 |
2,606 |
|
| Net income and comprehensive Income |
2,978 |
1,732 |
|
| Adjusted EBITDA(3) |
4,617 |
2,885 |
|
| |
|
|
|
| Net Cash flow from operating activities before change in working capital items |
3,135 |
2,013 |
|
| Cash flow from operating activities |
3,840 |
1,071 |
|
| |
|
|
|
| Earnings per share |
|
|
|
| Basic |
$0.08 |
$0.05 |
|
| Diluted |
$0.08 |
$0.05 |
|
| |
|
|
|
| Reconciliation of Net income and comprehensive income to EBITDA(3) |
|
|
|
| |
|
|
|
| Net comprehensive income |
2,978 |
1,732 |
|
| Income taxes |
1,205 |
905 |
|
| Financial expenses |
93 |
66 |
|
| Depreciation |
341 |
257 |
|
| Revaluation of warrants |
- |
(75 |
) |
| EBITDA |
4,617 |
2,885 |
|
(3) EBITDA: "Earnings before interest, taxes, depreciation and amortization, revaluation of warrants and impairment" is a non-GAAP financial performance measure with no standard definition under IFRS. It is therefore possible that this measure could not be comparable with a similar measure of another company. The Company uses this non-GAAP measure as an indicator of the cash generated by the operations and allows investor to compare the profitability of the company with others by canceling effects of different assets bases, effects due to different tax structures as well as the effects of different capital structures. See the 'Non-GAAP Measures' section of this MDA.
CASH FLOW FROM OPERATING, INVESTING AND FINANCING ACTIVITIES AND WORKING CAPITAL
Operating Activities
The significant increase in the gold production, which is due to higher grades of ore purchased and processed during the quarter generated $3.1M in cash flow from operations before changes in working capital items compared to $2.0M in Q1-2012, an increase of $1.1M (55%) compared to Q1-2012. Total cash generated from operating activities amounted to $3.8 M compared to $1.1 M in Q1-2012. Changes in working capital items amounted to $0.7M and included decreased costs invested in the inventory of ore, finished goods and gold in process ($8.1M at March 31, 2013 compared to $11.1M at year end 2012). At March 31, 2013 ore inventory represented 16 days of production compared to 28 days at year-end. Trades and other receivables increased by $2.1 M over year-end 2012 figure as the Company had not recovered Peruvian sales tax for five months at March 31, 2013. Those amounts have been recovered in April 2013.
Investing Activities
During the period, the Company invested $0.3M ($0.4M in Q1-2012) in the acquisition of property, plant and equipment to be used at the current plant and for the land site preparation for the construction of the new plant at Chala.
Additions to exploration and evaluation assets amounted to $0.5 M in Q1-2013 ($0.1 M in Q1-2012). The increase is explained by the ongoing exploration program which includes the surface drilling and the cross-cut in the gold veins.
Financing activities
During Q1-2013, the Company did not complete any share issue financing (nil in Q1-2012). The Company paid its quarterly interest on the outstanding loan term debt which will be reimbursed in June 2013.
During the period, 204,000 stock options were exercised for gross proceeds of $0.1M (90,000 options for gross proceeds of $0.03M in Q1-2012).
Liquidity
As at March 31, 2013, the Company's working capital amounted to $15.7M including $6.4M in cash ($13.3M including $3.3M in cash at December 31, 2012).
As at March 31, 2013, the Company had no financial commitment besides those disclosed in the section Long Term Liabilities and Contractual Obligations of its Q1-2013 MD&A, and has no restrictions in transferring funds from Peruvian subsidiaries to the parent Company.
ABOUT DYNACOR GOLD MINES INC.
Dynacor is an ore processing and a gold exploration and mining company active in Peru through its subsidiaries since 1996. The Company differentiates itself from pure exploration companies as it also generates income and cash flow from its wholly owned ore processing plant in Peru. The Company's assets include five exploration properties, including the Tumipampa property, as well as its 220 tpd gold and silver ore processing mill at Acari. Dynacor's mill produces gold from the processing of ore purchased from many different producers. Dynacor's strength and competitive advantage comes with the experience and knowledge the Company has developed while working in Peru. Its pride remains in maintaining respect and positive work ethics toward its employees, partners and local communities.
FORWARD LOOKING INFORMATION
Certain statements in the foregoing may constitute forward-looking statements, which involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Dynacor, or industry results, to be materially different from any future result, performance or achievement expressed or implied by such forward-looking statements. These statements reflect management's current expectations regarding future events and operating performance as of the date of this news release.
Website:http://www.dynacorgold.com
Twitter:http://twitter.com/DynacorGold
Facebook: http://www.facebook.com/pages/Dynacor-Gold-Mines-Inc/222350787793085
