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8-K - FORM 8-K - GOLD RESOURCE CORP | d351390d8k.htm |
Exhibit 99.1
FOR IMMEDIATE RELEASE | NEWS | |
May 10, 2012 | NYSE Amex: GORO |
GOLD RESOURCE CORPORATION REPORTS RECORD FIRST
QUARTER RESULTS; INCREASES PRECIOUS METAL GOLD EQUIVALENT
PRODUCTION BY 308% OVER Q1 2011
COLORADO SPRINGS May 10, 2012 Gold Resource Corporation (NYSE Amex: GORO) today announced record results for its first quarter ending March 31, 2012, including an increase of 308% production of precious metal gold equivalent and an increase of 281% mine gross profit over the first quarter of 2011. Gold Resource Corporation is a low-cost gold producer with operations in the southern state of Oaxaca, Mexico.
2012 Q1 HIGHLIGHTS
| Record production of 30,528 ounces precious metal gold equivalent (AuEq) |
| 308% AuEq production increase over Q1, 2011 |
| Record mine gross profit generated $33.7 million |
| 281% mine gross profit increase over Q1, 2011 |
| Total cash cost of $191 per ounce AuEq (including 5% royalty) |
| Record net income of $16.1 million or $0.30 per share |
| 693% net income increase over Q1, 2011 |
| Pretax income of $23.4 million or $0.44 per share |
| Dividend distributions of $7.9 million, or $0.15 per share for quarter |
| Physical gold and silver treasury of $5.6 million |
| Successfully launched physical gold and silver dividend program |
Overview of Q1 2012 Results from El Aguila Project
Gold Resource Corporations El Aguila Project produced 30,528 ounces of precious metal gold equivalent (AuEq) at a total cash cost of $191 per AuEq ounce and realized average prices of $1,740 per ounce gold and $34 per ounce silver for its sales during the first quarter. The mine generated gross profit of $33.7 million. The Company paid $7.9 million to shareholders in dividends and converted $2.9 million of its treasury into physical gold and silver. In addition, the Company successfully launched its dividend program where shareholders have the option to convert their cash dividends to physical gold and/or silver.
The first quarter set a strong base for the Company with record production, record revenues and dividends of $7.9 million while focusing on aggressive growth, stated Gold Resource Corporations President, Mr. Jason Reid. We maintain our 2012 production goal, targeting a range of 120,000 to 140,000 precious metal gold equivalent ounces.
Below is a table of the key production statistics for our El Aguila Project during the three months ended March 31, 2012.
Production and Sales Statistics |
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Three months ended March 31, 2012 |
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Production Summary |
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Milled: |
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Tonnes Milled |
75,078 | |||
Tonnes Milled per Day |
825 | |||
Grade: |
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Average Gold Grade (g/t) |
4.27 | |||
Average Silver Grade (g/t) |
483 | |||
Average Copper Grade (%) |
0.49 | |||
Average Lead Grade (%) |
1.73 | |||
Average Zinc Grade (%) |
3.59 | |||
Recoveries: |
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Average Gold Recovery (%) |
89 | |||
Average Silver Recovery (%) |
94 | |||
Average Copper Recovery (%) |
76 | |||
Average Lead Recovery (%) |
74 | |||
Average Zinc Recovery (%) |
74 | |||
Gross Payable metal produced |
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Gold (ozs.) |
9,222 | |||
Silver (ozs.) |
1,091,304 | |||
Copper (tonnes) |
350 | |||
Lead (tonnes) |
1,206 | |||
Zinc (tonnes) |
2,252 | |||
Payable metal sold |
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Gold (ozs.) |
6,668 | |||
Silver (ozs.) |
828,376 | |||
Copper (tonnes) |
210 | |||
Lead (tonnes) |
706 | |||
Zinc (tonnes) |
1,082 | |||
Average metal prices realized |
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Gold ( per oz.) |
$ | 1,740 | ||
Silver ( per oz.) |
$ | 34 | ||
Copper (per tonne) |
$ | 8,599 | ||
Lead (per tonne) |
$ | 2,144 | ||
Zinc (per tonne) |
$ | 2,133 | ||
Gold equivalent ounces produced |
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Gold (ounces) |
9,222 | |||
Equivalent Gold (ounces) from Silver |
21,306 | |||
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Total Gold and Gold Equivalent (ounces) |
30,528 | |||
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Unit costs |
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Costs per tonneore mined |
$ | 26 | ||
Costs per tonneore milled |
$ | 63 | ||
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Total cost per tonne |
$ | 89 | ||
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Cash operating cost per ounce gold equivalent (1) |
$ | 131 | ||
Total cash operating cost per ounce gold equivalent (1) |
$ | 191 |
(1) | A reconciliation of this non-GAAP measure to cost of sales and other direct production costs and depreciation, depletion and amortization, the most comparable GAAP measure, can be found in the Companys quarterly report on Form 10-Q for the period ended March 31, 2012 filed with the SEC and available at www.sec.gov. |
About GRC:
Gold Resource Corporation is a mining company focused on production and pursuing development of gold and silver projects that feature low operating costs and produce high returns on capital. The Company has 100% interest in six potential high-grade gold and silver properties in Mexicos southern state of Oaxaca. The Company has 52,911,516 shares outstanding, no warrants and no debt. Gold Resource Corporation is the only Company to offer its shareholders a dividend option to obtain physical gold or silver in addition to cash. For more information, please visit GRCs website, located at www.Goldresourcecorp.com and read the Companys 10-K for an understanding of the risk factors involved.
Cautionary Statements:
This press release contains forward-looking statements that involve risks and uncertainties. The statements contained in this press release that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. When used in this press release, the words plan, target, anticipate, believe, estimate, intend and expect and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements include, without limitation, the statements regarding Gold Resource Corporations strategy, future plans for production, future expenses and costs, future liquidity and capital resources, and estimates of mineralized material. All forward-looking statements in this press release are based upon information available to Gold Resource Corporation on the date of this press release, and the company assumes no obligation to update any such forward-looking statements. Forward looking statements involve a number of risks and uncertainties, and there can be no assurance that such statements will prove to be accurate. The Companys actual results could differ materially from those discussed in this press release. In particular, there can be no assurance that production will continue at any specific rate. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the Companys 10-K filed with the SEC.
Contacts:
Corporate Development
Greg Patterson
303-320-7708
www.Goldresourcecorp.com
See Accompanying Tables
The following information summarizes the results of operations for Gold Resource Corporation for the three months ended March 31, 2012 and 2011, its financial condition at March 31, 2012 and December 31, 2011 and its cash flows for the three months ended March 31, 2012 and 2011. The summary data for the three months ended March 31, 2012 and 2011 is unaudited; the summary data for the year ended December 31, 2011 is derived from our audited financial statements contained in our annual report on Form 10-K for the year ended December 31, 2011, but do not include the footnotes and other information that is included in the complete financial statements. Readers are urged to review the Companys Form 10-K in its entirety, which can be found on the SECs website at www.sec.gov.
The calculation of our cash cost per ounce contained in this press release is a non-GAAP financial measure. Please see Managements Discussion and Analysis and Results of Operation contained in the Companys most recent Form 10-Q and Form 10-K.
GOLD RESOURCE CORPORATION
(An Exploration Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS
for the three months ended March 31, 2012 and 2011
(U.S. dollars in thousands, except shares and per share amounts)
(Unaudited)
2012 | 2011 | |||||||
Sales of metals concentrate, net |
$ | 40,622 | $ | 11,280 | ||||
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Mine cost of sales: |
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Production costs applicable to sales |
6,679 | 2,352 | ||||||
Depreciation, depletion, and amortization |
232 | 64 | ||||||
Accretion |
20 | 21 | ||||||
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Total mine cost of sales |
6,931 | 2,437 | ||||||
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Mine gross profit |
33,691 | 8,843 | ||||||
Costs and expenses: |
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General and administrative expenses |
2,571 | 1,735 | ||||||
Stock-based compensation expense |
2,056 | 1,377 | ||||||
Exploration expenses |
1,353 | 512 | ||||||
Construction and development |
2,358 | 3,066 | ||||||
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Total costs and expenses |
8,338 | 6,690 | ||||||
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Operating income (loss) |
25,353 | 2,153 | ||||||
Other income (expense) |
(1,989 | ) | (120 | ) | ||||
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Income (loss) before income taxes |
23,364 | 2,033 | ||||||
Provision for income taxes |
7,242 | | ||||||
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Net income (loss) |
$ | 16,122 | $ | 2,033 | ||||
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Other comprehensive (loss) income: |
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Currency translation gain (loss) |
1,464 | 464 | ||||||
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Net comprehensive (loss) income |
$ | 17,586 | $ | 2,497 | ||||
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Net income per common share: |
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Basic |
$ | 0.30 | $ | 0.04 | ||||
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Diluted |
$ | 0.29 | $ | 0.04 | ||||
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Weighted average shares outstanding: |
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Basic |
52,898,984 | 52,998,303 | ||||||
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Diluted |
56,362,916 | 57,840,414 | ||||||
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The accompanying notes are an integral part of these financial statements.
GOLD RESOURCE CORPORATION
(An Exploration Stage Company)
CONSOLIDATED BALANCE SHEETS
(U.S. dollars in thousands, except shares)
March 31, 2012 |
December 31, 2011 |
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(unaudited) | ||||||||
ASSETS | ||||||||
Current assets: |
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Cash and cash equivalents |
$ | 44,004 | $ | 51,960 | ||||
Gold and silver bullion |
5,626 | 2,549 | ||||||
Accounts receivable |
17,900 | 14,281 | ||||||
Inventories |
7,453 | 4,243 | ||||||
IVA taxes receivable |
6,099 | 4,425 | ||||||
Deferred tax assets |
11,118 | 11,118 | ||||||
Prepaid expenses |
864 | 951 | ||||||
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Total current assets |
93,064 | 89,527 | ||||||
Land and mineral rights |
227 | 227 | ||||||
Property and equipmentnet |
12,323 | 10,318 | ||||||
Deferred tax asset |
19,517 | 19,517 | ||||||
Other assets |
7 | 6 | ||||||
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Total assets |
$ | 125,138 | $ | 119,595 | ||||
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LIABILITIES AND SHAREHOLDERS EQUITY | ||||||||
Current liabilities: |
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Accounts payable |
$ | 1,160 | $ | 1,691 | ||||
Accrued expenses |
4,522 | 4,879 | ||||||
IVA taxes payable |
8,142 | 4,984 | ||||||
Income taxes payable |
7,320 | 15,987 | ||||||
Dividends payable |
2,645 | 2,645 | ||||||
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Total current liabilities |
23,789 | 30,186 | ||||||
Asset retirement obligation |
2,514 | 2,281 | ||||||
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Total liabilities |
26,303 | 32,467 | ||||||
Shareholders equity: |
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Preferred stock$0.001 par value, 5,000,000 shares authorized: no shares issued and outstanding |
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Common stock$0.001 par value, 100,000,000 shares authorized: 53,006,871 and 52,998,303 shares issued and outstanding, respectively |
53 | 53 | ||||||
Additional paid-in capital |
126,650 | 132,529 | ||||||
(Deficit) accumulated during the exploration stage |
(23,400 | ) | (39,522 | ) | ||||
Treasury stock at cost, 104,251 shares |
(1,954 | ) | (1,954 | ) | ||||
Other comprehensive incomecurrency translation adjustment |
(2,514 | ) | (3,978 | ) | ||||
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Total shareholders equity |
98,835 | 87,128 | ||||||
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Total liabilities and shareholders equity |
$ | 125,138 | $ | 119,595 | ||||
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The accompanying notes are an integral part of these financial statements.
GOLD RESOURCE CORPORATION
(An Exploration Stage Company)
CONSOLIDATED STATEMENTS OF CASH FLOWS
for the three months ended March 31, 2012 and 2011
(U.S. dollars in thousands)
(Unaudited)
2012 | 2011 | |||||||
Cash flows from operating activities: |
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Net income (loss) |
$ | 16,122 | $ | 2,033 | ||||
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Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: |
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Depreciation, depletion, and amortization |
296 | 144 | ||||||
Accretion expense |
20 | 21 | ||||||
Stock compensation |
2,056 | 1,377 | ||||||
Foreign currency translation adjustment |
1,464 | 464 | ||||||
Unrealized loss (gain) from gold/silver bullion held |
(198 | ) | | |||||
Changes in operating assets and liabilities: |
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Accounts receivable |
(3,619 | ) | (3,209 | ) | ||||
Inventories |
(3,210 | ) | (4,688 | ) | ||||
IVA taxes receivable |
(1,674 | ) | (424 | ) | ||||
Prepaid expenses |
88 | | ||||||
Accounts payable |
(531 | ) | 449 | |||||
Accrued expenses |
(358 | ) | (230 | ) | ||||
IVA taxes payable |
3,158 | 501 | ||||||
Income taxes payable |
(8,667 | ) | | |||||
Other |
| (9 | ) | |||||
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Total adjustments |
(11,175 | ) | (5,604 | ) | ||||
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Net cash provided by (used in) operating activities |
4,947 | (3,571 | ) | |||||
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Cash flows from investing activities: |
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Capital expenditures |
(2,302 | ) | (1,425 | ) | ||||
Purchase of gold and silver bullion |
(2,879 | ) | | |||||
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Net cash (used in) investing activities |
(5,181 | ) | (1,425 | ) | ||||
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Cash flows from financing activities: |
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Dividends paid |
(7,935 | ) | (4,770 | ) | ||||
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Net cash provided by (used in) financing activities |
(7,935 | ) | (4,770 | ) | ||||
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Effect of exchange rates on cash and equivalents |
213 | 88 | ||||||
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Net increase (decrease) in cash and equivalents |
(7,956 | ) | (9,678 | ) | ||||
Cash and equivalents at beginning of period |
51,960 | 47,582 | ||||||
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Cash and equivalents at end of period |
$ | 44,004 | $ | 37,904 | ||||
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Supplemental Cash Flow Information |
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Interest paid |
$ | | $ | | ||||
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Income taxes paid |
$ | 17,305 | $ | | ||||
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