(all dollar amounts - other than per share amounts - are expressed in thousands of
FINANCIAL AND OPERATING HIGHLIGHTS FOR THE FOURTH QUARTER 2023
Gold Production
- 62,039 ounces of gold produced.
- A 6% increase in gold production compared to the same period in 2022 (Q4/22: 58,597 ounces of gold produced), explained by higher average gold grade at the Nechí Alluvial Property.
Cost of Sales, Cash Cost1 and All-in Sustaining Cost ("AISC")1 from continuing operations
- Cost of sales of
$82,663 , a 17% increase when compared to the same period in 2022 (Q4/22:$70,677 ). - Cash Cost per ounce of gold sold of
$1,051 (Q4/22:$993 ), a 6% increase relative to the same period in 2022. - AISC per ounce of gold sold of
$1,316 (Q4/22:$1,228 ), a 7% increase relative to the AISC per ounce of gold sold during the same period in 2022.
Dividend Payment
$5,228 in dividends paid.- An 8% increase in dividends paid compared to the same period in 2022 (Q4/22:
$4,862 ).
Revenue
- Revenue of
$130,427 . - Revenue increased by 24% compared to the same period in 2022 (Q4/22:
$105,059 ).
Profitability
- Gross profit from continuing operations increased by 39% to
$47,764 compared to the same period in 2022 (Q4/22:$34,382 ). - Net profit for the period from continuing operations up 26% to
$22,808 ($0.08 /share) compared to the same period in 2022 (Q4/22:$18,136 or$0.06 /share). - Loss for the period from discontinued operations up (97)% to
$1,043 compared to the same period in 2022 (Q4/22:$38,130 ).
Net Debt2
- Net Debt of
$(24,316) as atDecember 31, 2023 , mainly explained by lower loans and other borrowing and a higher cash and cash equivalents balance. - The Company continues to have low Net Debt levels, with a 239% decrease compared to
$17,517 as atDecember 31, 2022 .
FINANCIAL AND OPERATING HIGHLIGHTS FOR THE YEAR ENDED
Gold Production
- 219,708 ounces of gold produced.
- A 2% decrease in gold production compared to the same period in 2022 (Year ended
December 31, 2022 : 224,905 ounces of gold produced).
Cost of Sales, Cash Cost and AISC1
- Cost of sales of
$301,888 , a 7% increase when compared to the same period in 2022 (Year endedDecember 31, 2022 :$282,918 ) - Cash Cost per ounce of gold sold of
$1,090 (Year endedDecember 31, 2022 :$1,022 ), a 7% increase relative to the same period in 2022, mainly explained by the increase in cost of sales. - AISC per ounce of gold sold1 of
$1,299 (Year endedDecember 31, 2022 :$1,219 ), a 7% increase relative to the AISC per ounce of gold sold during the same period in 2022.
Dividend Payment
$20,519 in dividends paid.- An 11% decrease in dividends paid compared to the same period in 2022 (Year ended
December 31, 2022 :$22,990 ), explained by an extraordinary dividend of$0.01 per share paid in April of 2022.
Revenue
- Revenue of
$447,290 . - Revenue increased by 8% when compared to the same period in 2022 (Year ended
December 31, 2022 :$414,937 ).
Profitability
- Gross profit from continuing operations increased by10% , to
$145,402 compared to the same period in 2022 (Year endedDecember 31, 2022 :$132,019 ). - Net profit for the period from continuing operations up by 33% to
$74,538 ($0.25 /share) compared to the same period in 2022 (Year endedDecember 31, 2022 :$56,097 or$0.19 /share). - Loss for the period from discontinued operations up by 11%, to
$57,324 compared to the same period in 2022 (Year endedDecember 31, 2022 :$51,610 ).
_____________________________________ |
1 Cash Cost, AISC, Adjusted EBITDA, net free cash flow, Net Debt and average price realized per ounce of gold sold are non-IFRS financial measures, and Cash Cost per ounce of gold sold, AISC per ounce of gold sold and ROCE are non-IFRS ratios, with no standardized meaning under IFRS, and therefore they may not be comparable to similar measures presented by other issuers. For further information and detailed reconciliations of non-IFRS financial measures to the most directly comparable IFRS measures, see Non-IFRS and Other Financial Measures in this news release. |
2 Cash Cost, AISC, Adjusted EBITDA, net free cash flow, Net Debt and average price realized per ounce of gold sold are non-IFRS financial measures, and Cash Cost per ounce of gold sold, AISC per ounce of gold sold and ROCE are non-IFRS ratios, with no standardized meaning under IFRS, and therefore they may not be comparable to similar measures presented by other issuers. For further information and detailed reconciliations of non-IFRS financial measures to the most directly comparable IFRS measures, see Non-IFRS and Other Financial Measures in this news release. |
Financial and Operating Highlights.
Three Months Ended | Change | Year ended | Change | |||||
2023 | 2022 | $ | % | 2023 | 2022 | # | % | |
Financial | ||||||||
Revenue | 130,427 | 105,059 | 25,368 | 24 % | 447,290 | 414,937 | 32,353 | 8 % |
Cost of sales | (82,663) | (70,677) | 11,986 | 17 % | (301,888) | (282,918) | 18,970 | 7 % |
Gross Profit | 47,764 | 34,382 | 13,382 | 39 % | 145,402 | 132,019 | 13,383 | 10 % |
Profit for the period from | 22,808 | 18,136 | 4,672 | 26 % | 74,538 | 56,097 | 18,441 | 33 % |
Basic and diluted earnings per | 26 % | 33 % | ||||||
Loss for the year from | (1,043) | (38,130) | 37,087 | (97) % | (57,324) | (51,610) | (5,714) | 11 % |
Basic and diluted earnings per | (209) % | 284 % | ||||||
Adjusted EBITDA1 | 53,364 | 40,117 | 13,247 | 33 % | 172,146 | 156,156 | 15,990 | 10 % |
Net cash flows generated by | 52,932 | 36,602 | 16,330 | 45 % | 89,908 | 82,607 | 7,301 | 9 % |
Net free cash flow1 | 36,761 | 32,210 | 4,551 | 14 % | 49,202 | 35,611 | 13,591 | 38 % |
ROCE1 | 30 % | 25 % | 5 % | 21 % | 30 % | 25 % | 5 % | 21 % |
Net Debt 1 | (24,316) | 17,517 | (41,833) | (239) % | (24,316) | 17,517 | (41,833) | (239) % |
Dividends paid | 5,228 | 4,862 | 366 | 8 % | 20,519 | 22,990 | (2,471) | (11) % |
Operating | ||||||||
Average realized price per | 1,975 | 1,751 | 224 | 13 % | 1,937 | 1,800 | 137 | 8 % |
Total Gold Produced from | 62,039 | 58,597 | 3,442 | 6 % | 219,708 | 224,905 | (5,197) | (2) % |
Silver sold (oz) from continuing | 198,427 | 88,591 | 109,836 | 124 % | 614,756 | 358,046 | 256,710 | 72 % |
Cash Cost per ounce of gold | 6 % | 7 % | ||||||
AISC per ounce of gold | 7 % | 7 % |
1. | Cash Cost, AISC, Adjusted EBITDA, net free cash flow, Net Debt and average realized price per ounce of gold sold, are non-IFRS financial measures, and Cash Cost per ounce of gold sold, AISC per ounce of gold sold and ROCE are non-IFRS ratios, with no standardized meaning under IFRS, and therefore they may not be comparable to similar measures presented by other issuers. For further information and detailed reconciliations of non-IFRS financial measures to the most directly comparable IFRS measures, see Non-IFRS and Other Financial Measures in this news release. |
2. | In Q4 of 2023, the Company restated AISC and Cash Cost to capture cash outflows related to asset retirement obligations and environmental and rehabilitation costs. For further information and detailed reconciliations of non-IFRS financial measures to the most directly comparable IFRS measures, see Non-IFRS and Other Financial Measures in this news release. |
Operational Highlights by Material Property.
(All numbers in ounces unless otherwise noted)
Three Months | Change | Nine Months | Change | |||||
2023 | 2022 | ounces | % | 2023 | 2022 | # | % | |
Nechí Alluvial Property ( | 27,920 | 24,986 | 2,934 | 12 % | 93,757 | 92,385 | 1,372 | 1 % |
Hemco Property | 9,480 | 9,828 | (348) | (4) % | 32,732 | 40,677 | (7,945) | (20) % |
Artisanal Mining | 24,639 | 23,783 | 856 | 4 % | 93,219 | 91,843 | 1,376 | 1 % |
34,119 | 33,611 | 508 | 2 % | 125,951 | 132,520 | (6,569) | (5) % | |
Total Gold Produced (oz) from Continuing Operations | 62,039 | 58,597 | 3,442 | 6 % | 219,708 | 224,905 | (5,197) | (2) % |
Gualcamayo Property ( | — | 13,971 | (13,971) | (100) % | 31,061 | 62,247 | (31,186) | (50) % |
Total Gold Produced (oz) from Discontinued Operations | — | 13,971 | (13,971) | (100) % | 31,061 | 62,247 | (31,186) | (50) % |
Total Gold Produced (oz) | 62,039 | 72,568 | (10,529) | (15) % | 250,769 | 287,152 | (36,383) | (13) % |
Total Silver Produced (oz) | 198,427 | 93,528 | 104,899 | 112 % | 623,976 | 379,392 | 244,584 | 64 % |
For the three months ended
For the year ended
CORPORATE HIGHLIGHTS FOR THE YEAR ENDED
Disposition of
On
Temporary suspension of the main processing plant at the Hemco Property in
On
New collective agreement in
On
Termination of strategic alliance with Royal Road Minerals Limited
Effective
Mineros and Royal Road terminated their strategic alliance agreements for exploration of their respective properties in
Royal Road relinquished its 50% joint venture interest in Caribe Exploration Target to Mineros' subsidiary
Positive Prefeasibility Study Results for the
On
- Mineral Resource and Mineral Reserve estimates for the Porvenir Project, effective
December 31, 2022 .- 270 kt of proven mineral reserves averaging 2.70 g/t Au, 13.6 g/t Ag and 3.14% Zn, containing 23 koz Au, 118 koz Ag, and 19 Mlb Zn;
- 5,524 kt of probable mineral reserves averaging 3.09 g/t Au, 10.2 g/t Ag and 2.96% Zn, containing 549 koz Au, 1,804 koz Ag, and 360 Mlb Zn;
Porvenir Project base case economics include an after-tax net present value (using a 10% discount rate) of approximately$42 million , an after-tax internal rate of return ("IRR") of approximately 16% and a payback period of approximately 4 years from start of production in 2027, assuming$1,500 /oz Au,$19.00 /oz Ag, and$1.27 /lb Zn;- The Porvenir Project will add average annual production over its nine-year mine life of 56,700 oz Au per year, along with 112,300 oz Ag per year and 38.5 Mlb Zn per year to the Hemco Property;
- After-tax net present value (using a 5% discount rate) of
$160 million at$1,650 /oz Au,$20.90 /oz Ag, and$1.40 /lb Zn; increasing to$216 million at$1,800 /oz Au,$22.80 /oz Ag, and$1.52 /lb Zn; and - IRR of 21% and after-tax payback period of 3.5-years from start of production at
$1,650 /oz Au,$20.90 /oz Ag, and$1.40 /lb Zn.
A NI 43-101 technical report on the Hemco Property, entitled "Technical Report on the Hemco Property, Región Autónoma de la
Temporary Suspension of Operations at the Nechí Alluvial Property in
On
Subsequent events
Profit Distribution Proposal to the
On
At the Meeting, shareholders will be asked to consider and approve, with or without variation, the distribution of the Company's profits by way of dividend proposed by the Board, as set out below:
Profit Distribution Proposal | ||
($) | (COP$)4 | |
Profit for the year | 15,441,821 | 61,023,949,313 |
Minus: Transfer of profits for the year to new projects reserve | 15,441,821 | 61,023,949,313 |
Plus: Release from non-taxable reserves from previous years | 26,976,366 | 106,606,882,786 |
Available for distribution to shareholders: | 26,976,366 | 106,606,882,786 |
The following distribution is proposed: | ||
Payment of untaxed dividend | 26,976,366 | 106,606,882,786 |
Notes: | |
1. | Payment of each dividend installment will be made for all outstanding shares on the applicable payment date to all registered shareholders within a specified ex dividend period. |
2. | Dividend payments do not include interest payments. |
3. | Dividend payments will be converted to Colombian pesos, based on the Representative Market Rate (Tasa Representativa del Mercado – TRM) on each payment date. |
4. |
Based on the foregoing proposal, a shareholder would be entitled to receive payment of an ordinary dividend in respect of each common share held equal to four installments of
The Board believes that the proposed profit distribution is in the best interest of the shareholders and will be voted on at the Meeting.
GROWTH AND EXPLORATION PROJECT UPDATES
The two key growth and exploration projects the Company is advancing are the
The infill drilling campaign is confirming Mineros' view that mineralization extends below the current resource estimate and that mineralization remains open at depth.
Luna Roja Deposit,
OUTLOOK
The following section represents forward looking information and users are cautioned that actual results may vary. We refer to the risks and assumptions contained later in this news release under "Forward-Looking Statements".
Gold production guidance
The following table presents the Company's gold production guidance for 2024 and actual production for the year ended
Actual (oz) | Guidance (oz) | ||
31 December | 2023 | 2024 | |
93,757 | 84,000 - 94,000 | 86,000 - 96,000 | |
32,732 | 35,000 - 37,800 | 33,000 - 35,000 | |
Total Company Mines (1) | 157,550 | 172,000 - 194,800 | 118,500 - 131,000 |
93,219 | 90,000 - 97,200 | 90,000 - 98,000 | |
Total gold production (ounces) (1) | 250,769 | 239,000 - 262,000 | 209,000 - 229,000 |
(1) |
Cost outlook
The following table outlines the Company's Cash Cost and AISC per ounce of gold sold for the year ended
Actual Cash | Cash Cost Guidance ($/oz) | Actual AISC | AISC ($/oz) Guidance ($/oz) | |||
Country (principal mine) | 31 December | 2023 | 2024 | 31 | 2023 | 2024 |
1,046 | 1,010 - 1,110 | 1,188 | 1,170 - 1,280 | |||
1,246 | 1,170 - 1,250 | 1,414 | 1,350 - 1,430 | |||
Consolidated (1) | 1,216 | 1,170 - 1,270 | 1,441 | 1,440 - 1,540 |
(1) Consolidated Cash Cost per ounce of gold sold and AISC per ounce of gold sold include the Gualcamayo Property, which was sold in |
Cash Cost and AISC per ounce of gold sold outlook were prepared assuming an average selling price of gold of
CONFERENCE CALL AND WEBCAST DETAILS
The Company will host a conference call on
A live webcast of the conference all will be available at:
https://app.webinar.net/489vQdrA7nE
Live webcast requires previous registration, and interested parties are advised to access the webcast approximately ten minutes prior to the start of the call. The webcast will be archived on the Company's website at www.mineros.com.co for approximately 30 days following the call.
ABOUT
Mineros is a gold mining company headquartered in
The board of directors and management of Mineros have extensive experience in mining, corporate development, finance and sustainability. Mineros has a long track record of maximizing shareholder value and delivering solid annual dividends. For almost 50 years Mineros has operated with a focus on safety and sustainability at all its operations.
Mineros' common shares are listed on the
The Company has been granted an exemption from the individual voting and majority voting requirements applicable to listed issuers under
QUALIFIED PERSON
The scientific and technical information contained in this news release has been reviewed and approved by
FORWARD-LOOKING STATEMENTS
This news release contains "forward looking information" within the meaning of applicable Canadian securities laws. Forward looking information includes statements that use forward looking terminology such as "may", "could", "would", "will", "should", "intend", "target", "plan", "expect", "budget", "estimate", "forecast", "schedule", "anticipate", "believe", "continue", "potential", "view" or the negative or grammatical variation thereof or other variations thereof or comparable terminology. Such forward looking information includes, without limitation, statements with respect to the Company's outlook for 2024; estimates for future mineral production and sales; the Company's expectations, strategies and plans for the
Forward looking information is based upon estimates and assumptions of management in light of management's experience and perception of trends, current conditions and expected developments, as well as other factors that management believes to be relevant and reasonable in the circumstances, as of the date of this news release including, without limitation, assumptions about: favourable equity and debt capital markets; the ability to raise any necessary additional capital on reasonable terms to advance the production, development and exploration of the Company's properties and assets; future prices of gold and other metal prices; the timing and results of exploration and drilling programs, and technical and economic studies; the accuracy of any Mineral Reserve and Mineral Resource estimates; the geology of the
For further information of these and other risk factors, please see the '"Risk Factors" section of the Company's annual information form dated
The Company cautions that the foregoing lists of important assumptions and factors are not exhaustive. Other events or circumstances could cause actual results to differ materially from those estimated or projected and expressed in, or implied by, the forward looking information contained herein. There can be no assurance that forward looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward looking information.
Forward looking information contained herein is made as of the date of this news release and the Company disclaims any obligation to update or revise any forward looking information, whether as a result of new information, future events or results or otherwise, except as and to the extent required by applicable securities laws.
NON-IFRS AND OTHER FINANCIAL MEASURES
The Company has included certain non-IFRS financial measures and non-IFRS ratios in this news release. Management believes that non-IFRS financial measures and non-IFRS ratios, when supplementing measures determined in accordance with IFRS, provide investors with an improved ability to evaluate the underlying performance of the Company. Non-IFRS financial measures and non-IFRS ratios do not have any standardized meaning prescribed under IFRS, and therefore they may not be comparable to similar measures employed by other companies. This data is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. For a discussion of the use of non-IFRS financial measures and reconciliations thereof to the most directly comparable IFRS measures, see below.
In the fourth quarter of 2023, in order to accommodate the transactions that occurred during the period, the Company aligned its definitions of non-IFRS measures to more accurately reflect the economic reality of its operations. Management implemented certain changes including the removal of the non-IFRS financial measure Net Debt to Adjusted EBITDA ratio and included Net Debt instead. This change aligns the non-IFRS financial measures to those used by the business to evaluate the performance of the Company. AISC and Cash Cost have been restated to capture cash outflows related to asset retirement obligations and environmental and rehabilitation costs. No other changes to the determination of the remaining non-IFRS financial measures have been made.
EBIT, EBITDA and Adjusted EBITDA
The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use the earnings before interest and tax ("EBIT"), earnings before interest, tax, depreciation and amortization ("EBITDA"), and adjusted earnings before interest, tax, depreciation and amortization ("Adjusted EBITDA"), which excludes certain non-operating income and expenses, such as financial income or expenses, hedging operations, exploration expenses, impairment of assets, foreign currency exchange differences, and other expenses (principally, donations, corporate projects and taxes incurred). The Company believes that Adjusted EBITDA provides useful information to investors and others in understanding and evaluating our operating results because it is consistent with the indicators management uses internally to measure the Company's performance, and is an indicator of the performance of the Company's mining operations.
The following table provides a reconciliation of the Adjusted EBITDA for the three months and years ended
Three Months Ended | Year ended | |||
2023 | 2022 | 2023 | 2022 | |
Profit for the Period | 21,765 | (19,994) | 17,214 | 4,487 |
Less: Interest income | (352) | (1,409) | (1,302) | (1,772) |
Add: Interest expense | 1,557 | 1,394 | 5,118 | 4,408 |
Add: Current tax 1 | 12,472 | 8,480 | 42,561 | 37,409 |
Add/less: Deferred tax 1 | (3,376) | (1,593) | (14,520) | 447 |
EBIT | 32,066 | (13,122) | 49,071 | 44,979 |
Add: Depreciation and amortization | 12,330 | 10,926 | 45,099 | 43,335 |
EBITDA | 44,396 | (2,196) | 94,170 | 88,314 |
Less: Other income 2 | (1,082) | (889) | (6,104) | (1,512) |
Less: Finance income (excluding interest | (8) | (67) | (107) | (197) |
Add: Finance expense (excluding interest | 1,051 | 787 | 3,833 | 2,404 |
Add: Other expenses 3 | 4,152 | 2,532 | 10,053 | 7,802 |
Add: Exploration expenses | 2,556 | 2,708 | 6,092 | 8,600 |
Less: Foreign exchange differences | 1,139 | (921) | 6,768 | (5,689) |
Add: Loss for the period from discontinued | 1,043 | 38,130 | 57,324 | 51,610 |
Adjusted EBITDA | 53,364 | 40,117 | 172,146 | 156,156 |
1. | For additional information regarding taxes, see Note 15 of our audited consolidated financial statements, for the three months and years ended |
2. | For additional information regarding other income, see Note 11 of audited consolidated financial statements, for the three months and years ended |
3. | The reconciliation above does not include adjustments for share of results of investments in associates, or (impairment) reversal of assets, because there would be a nil adjustment for the three months and years ended |
4. | Composition of Adjusted EBITDA has been revised to include loss for the period from discontinued operations. |
Cash Cost
The objective of Cash Cost is to provide stakeholders with a key indicator that reflects as close as possible the direct cost of producing and selling an ounce of gold.
The Company reports Cash Cost per ounce of gold sold which is calculated by deducting revenue from silver sales, depreciation and amortization, environmental rehabilitation provisions and adding back the used assets retirement obligations and the used environmental and rehabilitation liabilities to cost of sales, and dividing the difference by the number of gold ounces sold. Production Cash Cost includes mining, milling, mine site security, royalties, and mine site administration costs, and excludes non-cash operating expenses. Cash Cost per ounce of gold sold is a non-IFRS financial measure used to monitor the performance of our gold mining operations and their ability to generate profit, and is consistent with the guidance methodology set out by the
The following table provides a reconciliation of Cash Cost per ounce of gold sold on a by-product basis to cost of sales for the three months and years ended
Three Months Ended | Year ended | |||
2023 | 2022 | 2023 | 2022 | |
Cost of sales | 82,663 | 70,677 | 301,888 | 282,918 |
Less: Cost of sales of non-mining operations 1 | (257) | (125) | (751) | (603) |
Less: Depreciation and amortization | (11,885) | (10,544) | (43,665) | (41,864) |
Less: Sales of silver | (4,669) | (1,974) | (14,384) | (7,858) |
Less: Environmental rehabilitation provision 2 | (1,846) | (160) | (4,788) | (3,206) |
Add: Use of environmental and rehabilitation | 1,137 | 303 | 1,137 | 303 |
Add: Use of Retirement obligations | 81 | 11 | 81 | 190 |
Cash Cost from continuing operations | 65,224 | 58,188 | 239,518 | 229,880 |
Gold sold (oz) from continuing operations | 62,039 | 58,597 | 219,708 | 224,905 |
Cash Cost per ounce of gold sold ($/oz) from | ||||
Cash Cost from discontinued operations | — | 19,517 | 66,262 | 90,636 |
Gold sold (oz) from discontinued operations | — | 13,660 | 31,737 | 62,781 |
Cash Cost per ounce of gold sold ($/oz) from | ||||
Cash Cost | 65,224 | 77,705 | 305,780 | 320,516 |
Gold sold (oz) | 62,039 | 72,257 | 251,445 | 287,686 |
Cash Cost per ounce of gold sold ($/oz) |
1. | Refers to cost of sales incurred in the Company's "Others" segment. See Note 8 of our audited consolidated financial statements for the three months and years ended December 31, 2023 and 2022. The majority of this amount relates to the cost of sales of latex. |
2. | For additional information regarding environmental rehabilitation provision, please refer to Note 31 of the consolidated financial statements for the year ended |
The following table provides a reconciliation of Cash Cost per ounce of gold sold on a by-product basis to cost of sales, before and after the change of definition of this metric, modified to capture cash outflows related to asset retirement obligation and environmental rehabilitation provisions, for the three months and year ended
Three Months Ended | Year ended | |
Cash Cost per ounce of gold sold ($/oz) - Previously | 1,073 | 1,124 |
Adjustments ($/oz) | ||
Less: Environmental rehabilitation provision | (3) | (12) |
Add: Use of environmental and rehabilitation liabilities | 5 | 1 |
Add: Use of Retirement obligations | — | 1 |
Cash Cost per ounce of gold sold ($/oz) - restated | 1,075 | 1,114 |
All-in Sustaining Costs
The objective of AISC is to provide stakeholders with a key indicator that reflects as close as possible the full cost of producing and selling an ounce of gold. AISC per ounce of gold sold is a non-IFRS ratio that is intended to provide investors with transparency regarding the total costs of producing one ounce of gold in the relevant period.
The Company reports AISC per ounce of gold sold on a by-product basis. The methodology for calculating AISC per ounce of gold sold is set out below and is consistent with the guidance methodology set out by the
The following table provides a reconciliation of AISC per ounce of gold sold to cost of sales for the three months and years ended
Three Months Ended | Year ended | |||
2023 | 2022 | 2023 | 2022 | |
Cost of sales | 82,663 | 70,677 | 301,888 | 282,918 |
Less: Cost of sales of non-mining operations 1 | (257) | (125) | (751) | (603) |
Less: Depreciation and amortization | (11,885) | (10,544) | (43,665) | (41,864) |
Less: Sales of silver | (4,669) | (1,974) | (14,384) | (7,858) |
Less: Sales of electric energy | (2,071) | (1,099) | (5,346) | (3,895) |
Less: Environmental rehabilitation provision 2 | (1,846) | (160) | (4,788) | (3,206) |
Add: Use of environmental and rehabilitation | 1,137 | 303 | 1,137 | 303 |
Add: Use of Retirement obligations | 81 | 11 | 81 | 190 |
Add: Administrative expenses | 6,730 | 5,191 | 18,355 | 19,198 |
Less: Depreciation and amortization of | (445) | (382) | (1,434) | (1,471) |
Add: Sustaining leases and leaseback 4 | 2,070 | 1,678 | 7,995 | 6,689 |
Add: Sustaining exploration 5 | 337 | 1,265 | 885 | 4,427 |
Add: Sustaining capital expenditures 6 | 9,822 | 7,130 | 25,378 | 19,426 |
AISC from continuing operations | 81,667 | 71,971 | 285,351 | 274,254 |
Gold sold (oz) from continued operations | 62,039 | 58,597 | 219,708 | 224,905 |
All-in sustaining costs per ounce of gold | ||||
AISC from discontinued operations | — | 26,402 | 76,911 | 115,682 |
Gold sold (oz) from discontinued operations | — | 13,660 | 31,737 | 62,781 |
All-in sustaining costs per ounce of gold | ||||
AISC | 81,667 | 98,373 | 362,262 | 389,936 |
Gold sold (oz) | 62,039 | 72,257 | 251,445 | 287,686 |
All-in sustaining costs per ounce of gold |
1. | Cost of sales of non-mining operations is the cost of sales excluding cost incurred by non-mining operations and the majority of this cost comprises the cost of sales of latex. |
2. | For additional information regarding environmental rehabilitation provision, please refer to Note 31 of the audited consolidated financial statements for the year ended |
3. | Depreciation and amortization of administrative expenses is included in the administrative expenses line on the audited consolidated financial statements, and is mainly related to depreciation for corporate office spaces and local administrative buildings at the Hemco Property. |
4. | Represents most lease payments as reported on the audited consolidated financial statements of cash flows and is made up of the principal component of such cash payments, less non-sustaining lease payments. Lease payments for new development projects and capacity projects are classified as non-sustaining. |
5. | Sustaining exploration: Exploration expenses and exploration and evaluation projects as reported on the audited consolidated financial statements, less non-sustaining exploration. Explorations are classified as either sustaining or non-sustaining based on a determination of the type and location of the exploration expenditure. Exploration expenditures within the footprint of operating mines are considered costs required to sustain current operations and so are included in sustaining costs. Exploration expenditures focused on new ore bodies near existing mines (i.e. brownfield), new exploration projects (i.e. greenfield) or for other generative exploration activity not linked to existing mining operations are classified as non- sustaining. |
6. | Sustaining capital expenditures: Represents the capital expenditures at existing operations including, periodic capitalized stripping and underground mine development costs, ongoing replacement of mine equipment and overhaul of existing equipment, and is calculated as total additions to property, plant and equipment (as reported on the consolidated statements of cash flows), less non-sustaining capital. Non-sustaining capital represents capital expenditures for major projects, including projects at existing operations that are expected to materially benefit the operation and provide a level of growth, as well as enhancement capital for significant infrastructure improvements at existing operations. Non-sustaining capital expenditures during the three months and years ended |
The following table provides a reconciliation of AISC per ounce of gold sold on a by-product basis to cost of sales, before and after the change of definition of this metric, modified to capture cash outflows related to asset retirement obligation and environmental rehabilitation provisions, for the three months and years ended
Three Months Ended | Year ended | |
All-in sustaining costs per ounce of gold sold ($/oz) - | 1,359 | 1,364 |
Adjustments ($/oz) | ||
Less: Environmental rehabilitation provision | (2) | (11) |
Add: Use of environmental and rehabilitation liabilities | 4 | 1 |
Add: Use of Retirement obligations | — | 1 |
All-in sustaining costs per ounce of gold sold ($/oz) | 1,361 | 1,355 |
Net Free Cash Flow
The Company uses the financial measure "net free cash flow", which is a non-IFRS financial measure, to supplement information regarding cash flows generated by operating activities. The Company believes that in addition to IFRS financial measures, certain investors and analysts use this information to evaluate the Company's performance with respect to its operating cash flow capacity to meet recurring outflows of cash.
Net free cash flow is calculated as cash flows generated by operating activities less non-discretionary sustaining capital expenditures and interest and dividends paid related to the relevant period.
The following table sets out the calculation of the Company's net free cash flow to net cash flows generated by operating activities for the three months and years ended
Three Months Ended | Year ended | |||
2023 | 2022 | 2023 | 2022 | |
Net cash flows generated by operating activities | 52,932 | 36,602 | 89,908 | 82,607 |
Non-discretionary items: | ||||
Sustaining capital expenditures | (9,822) | (7,130) | (25,378) | (19,426) |
Interest paid | (1,121) | (1,632) | (7,572) | (5,233) |
Dividends paid | (5,228) | (4,862) | (20,519) | (22,990) |
Net cash flows used in (generated from) | — | 9,232 | 12,763 | 653 |
Net free cash flow | 36,761 | 32,210 | 49,202 | 35,611 |
1. Composition of net free cash flow has been revised to exclude net cash flows used in (generated from) discontinued operations. |
Return on Capital Employed
The Company uses ROCE as a measure of long-term operating performance to measure how effectively management utilizes the capital it has provided. This non-IFRS ratio is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. The calculation of ROCE, expressed as a percentage, is Adjusted EBIT (calculated in the manner set out in the table below) divided by the average of the opening and closing capital employed for the 12 months preceding the period end. Capital employed for a period is calculated as total assets at the beginning of that period less total current liabilities. The following table sets out the calculation of ROCE as at December 31, 2023 and 2022.
As at | ||
2023 | 2022 | |
Adjusted EBITDA (last 12 months) | 172,146 | 156,156 |
Less: Depreciation and amortization (last 12 months) | (45,099) | (43,335) |
Adjusted EBIT (A) | 127,047 | 112,821 |
Total assets at the beginning of the period | 569,543 | 580,046 |
Less: Total current liabilities at the beginning of the period | (134,581) | (110,601) |
Opening Capital Employed (B) | 434,962 | 469,445 |
Total assets at the end of the period | 493,757 | 569,543 |
Less: Current liabilities at the end of the period | (84,765) | (134,581) |
Closing Capital employed (C) | 408,992 | 434,962 |
421,977 | 452,204 | |
ROCE (A/D) | 30 % | 25 % |
Net Debt
Net Debt is a non IFRS financial measure that provides insight regarding the liquidity position of the Company. The calculation of net debt shown below is calculated as nominal undiscounted debt including leases, less cash and cash equivalents. The following sets out the calculation of Net Debt as at
As at | ||
2023 | 2022 | |
Loans and other borrowings | 32,802 | 56,322 |
Less: Cash and cash equivalents | (57,118) | (38,805) |
Net Debt | (24,316) | 17,517 |
Average Realized Price
The Company uses "average realized price per ounce of gold" and "average realized price per ounce of silver", which are non-IFRS financial measures. Average realized metal price represents the revenue from the sale of the underlying metal as per the statement of operations, adjusted to reflect the effect of trading at holding level (parent Company) on the sales of gold purchased from subsidiaries. Average realized prices are calculated as the revenue related to gold and silver sales divided by the number of ounces of metal sold. The following table sets out the reconciliation of average realized metal prices to sales of gold and sales of silver for the three months and years ended
Three Months Ended | Year ended | |||
2023 | 2022 | 2023 | 2022 | |
Sales of gold from continuing operations | 122,530 | 102,579 | 425,647 | 404,799 |
Gold sold from continuing operations (oz) | 62,039 | 58,597 | 219,708 | 224,905 |
Average realized price per ounce of gold | 1,975 | 1,751 | 1,937 | 1,800 |
Sales of gold from discontinued operations | — | 23,645 | 61,516 | 112,635 |
Gold sold (oz) from discontinued operations | — | 13,660 | 31,737 | 62,781 |
Average realized price per ounce of gold | — | 1,731 | 1,938 | 1,794 |
Average realized price per ounce of gold | 1,975 | 1,747 | 1,937 | 1,799 |
Sales of silver from continuing operations | 4,669 | 2,080 | 14,529 | 8,260 |
Silver sold from continuing operations (oz) | 198,427 | 88,591 | 614,756 | 358,046 |
Average realized price per ounce of | 24 | 23 | 24 | 23 |
Sales of silver from discontinued operations | — | 106 | 217 | 402 |
Silver sold (oz) from discontinued | — | 4,937 | 9,220 | 21,346 |
Average realized price per ounce of | — | 21 | 24 | 19 |
Average realized price per ounce of | 24 | 23 | 24 | 23 |
SOURCE
© Canada Newswire, source