Production Increases 17%, and Margins Increase 20% at its Core North American Assets, Company-Wide Adjusted Net Earnings Increase 81%
TORONTO, May 9, 2012 /PRNewswire/ - AuRico Gold Inc. (TSX: AUQ) (NYSE: AUQ), ("AuRico" or "the Company") is pleased to report financial results for the first quarter ended March 31, 2012. All amounts are in U.S. dollars unless otherwise indicated.
First Quarter Financial Highlights
For the first quarter, the Company reported the following results, inclusive of discontinued operations unless otherwise noted:
"During the first four months of 2012 the Company has continued to deliver on its strategic plan, advancing the Young-Davidson mine to production and streamlining our asset base through the divestiture of non-core assets. Our exclusive focus is now on our portfolio of three large, low-cost, producing operations as well as exploration and development properties located in Canada and Mexico." stated René Marion, Chief Executive Officer. He continued, "On April 30th, Young-Davidson completed its first gold pour. The commissioning process is proceeding better than anticipated with mill throughput currently exceeding targeted levels. We remain on track to declare commercial production in early Q3 with a re-engineered mine plan that is expected to deliver annual production of 250,000 ounces by 2016."
First Quarter Highlights - Core Assets
First quarter highlights from the Company's core assets is provided in the table below:
|Ocampo||El Chanate||Q1 2012||Q1 2011|
|Gold eq. oz. produced (realized)(1)||39,377||19,093||58,470||49,854|
|Gold eq. oz. sold (realized) (1)||35,333||18,661||53,994||50,681|
|Total cash costs per gold eq. oz. (realized)(1)(3)||$537||$409||$493||$382|
|Margins per gold eq. oz. (realized)||$1,163||$1,291||$1,207||$1,004|
|Gold eq. oz. produced (55:1)(2)||38,310||19,093||57,403||44,703|
|Gold eq. oz. sold (55:1)(2)||34,315||18,661||52,976||45,309|
|Total cash costs per gold eq. oz. (55:1)(2)(3)||$553||$409||$502||$427|
|Margins per gold eq. oz. (55:1)||$1,147||$1,291||$1,198||$959|
|(1) Gold equivalent ounces include silver ounces produced / sold
converted to a gold equivalent, based on the ratio of the realized
sales prices of the commodities.|
(2) Gold equivalent ounces include silver ounces produced / sold converted to a gold equivalent, based on the long-term gold equivalency ratio of 55:1.
(3) Cash costs for the Ocampo mine and on a consolidated basis are calculated on a per gold equivalent ounce basis. Cash costs for the El Chanate mine are calculated on a per gold ounce basis, using silver revenues as a by-product cost credit. Refer to the discussion of Non-GAAP measures below.
First Quarter Results
|Quarter Ended |
March 31, 2012
March 31, 2011
|Revenue from mining operations(1)||$112,451||$70,313|
|Average realized gold price per ounce||$1,700||$1,386|
|Average realized silver price per ounce||$33.02||$32.30|
|Earnings from operations(1)||$40,836||$23,552|
|Net earnings from continuing operations||$1,319||$11,786|
|Net earnings from discontinued operations||$34||-|
|Total net earnings||$1,353||$11,786|
|Net earnings per share from continuing operations, basic||$0.00||$0.09|
|Net earnings per share from discontinued operations, basic||$0.00||-|
|Total net earnings per share, basic||$0.00||$0.09|
|Adjusted net earnings(2)||$57,815||$20,165|
|Adjusted net earnings per share||$0.21||$0.14|
|Total operating cash flow||$64,579||$33,621|
|Total net free cash flow||($100,437)||$5,933|
|(1) Operational data, including ounces produced and sold, and cash costs
include the results of both continuing and discontinued operations.
Certain financial information, including revenues, production costs,
earnings from operations are exclusive of discontinued operations as
the financial results and balances of these operations are presented
separately on the Condensed Consolidated Statements of Operations
within the Company's Condensed Consolidated Financial Statements for
the three months ended March 31, 2012.|
(2) See the table at the end of this press release for a reconciliation of adjusted net earnings and refer to the Non-GAAP Measures section below.
Recent Corporate Announcements
Adjusted Net Earnings
|Adjusted Net Earnings Reconciliation|
|(in thousands, except per share metrics)||Q1 2012||Q1 2011|
|Net earnings from continuing operations||$1,319||$11,786|
|Unrealized foreign exchange loss||19,739||1,762|
|Fair value adjustment on option component of convertible senior notes||13,802||-|
|Unrealized and realized losses on investments||361||490|
|Unrealized gain on derivative liabilities||(297)||-|
|Mine standby costs||-||7,555|
|Tax effect of adjustments||-||(2,115)|
|Adjusted net earnings from continuing operations||$34,924||$20,165|
|Adjusted net earnings from continuing operations per share||$0.13||$0.14|
|Net earnings from discontinued operations||$34||$-|
|Tax effect of adjustments||-||-|
|Adjusted net earnings from discontinued operations||$22,891||$-|
|Adjusted net earnings from discontinued operations per share||$0.08||$-|
|Adjusted net earnings||$57,815||$20,165|
|Adjusted net earnings per share||$0.21||$0.14|
The Company uses the measures adjusted net earnings, cash costs per ounce, and net free cash flow in this press release, which do not have a standardized meaning prescribed by International Financial Reporting Standards ("IFRS" or "GAAP"). They are, therefore, considered to be non-GAAP measures and may not be comparable to similar measures presented by other companies. The non-GAAP measures cash costs per ounce and net free cash flow are reconciled to the Company's financial statements on page 23 of the Company's Management's Discussion and Analysis.
Adjusted net earnings is comprised of net earnings from both continuing and discontinued operations, adjusted for specific items. While the adjustments to net earnings in this measure include items that are recurring, adjusted net earnings is a useful measure as the unrealized gains / losses on foreign exchange, fair value adjustments on investments and derivative liabilities, and other non-recurring items do not reflect the underlying operating performance of the Company's core mining business and are not necessarily indicative of future operating results.
Financial Statements and Management's Discussion and Analysis
The interim financial statements and related Management's Discussion and Analysis can be found on the Company's website at www.auricogold.com or under the Company's profile on www.sedar.com and with the Securities and Exchange Commission at http://www.sec.gov/edgar.shtml ("Edgar").
Q1 Conference Call and Webcast
A webcast and conference call will be held on Thursday, May 10, 2012 starting at 10:00 a.m. Eastern Time. Senior management will be on the call to discuss the results.
Conference Call Access:
When the Operator answers, please ask to be placed into the AuRico Gold First Quarter 2012 Results Conference Call.
Conference Call Webcast:
The conference call event will be broadcast live on the internet via webcast. To access the webcast please follow the link provided below:
Archive Call Access:
If you are unable to attend the conference call, a replay will be available until midnight, May 17, 2012 by dialing the appropriate number below:
The webcast will be archived for 90 days by following the link provided below:
http://www.newswire.ca/en/webcast/detail/957203/1026009 or via the Company's website at www.auricogold.com.
About AuRico Gold
AuRico Gold is a leading Canadian gold producer with a diversified portfolio of high quality mines and projects in North America. With initial production achieved at Young-Davidson, the Company will be focussed on 3 core operations including the Ocampo mine in Chihuahua State and the El Chanate mine in Sonora State. The exciting Young-Davidson gold mine in northern Ontario is expected to reach commercial production by the third quarter of this year and ramp-up to over 250,000 ounces of annual production by 2016. AuRico's strong project pipeline includes several advanced development opportunities in Mexico and British Columbia. AuRico's head office is located in Toronto, Ontario, Canada. For further information please visit the AuRico Gold website at http://www.auricogold.com or contact:
Cautionary Note to US Investors - The United States Securities and Exchange Commission permits US mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. This press release uses certain terms, such as "measured", "indicated" and "inferred" "resources", that the SEC guidelines strictly prohibit US registered companies from including in their filings with the SEC. The term "resources" does not equate to the term "reserves" and U.S. investors are cautioned not to assume that any part or all of the minerals in these categories will ever be converted to reserves. US Investors are urged to consider closely the disclosure in AuRico Gold's Annual Report on Form 40-F, which may be secured from AuRico Gold, or from the SEC's website at http://www.sec.gov/edgar.shtml.
No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.
Certain statements included herein, including information as to the future financial or operating performance of the Company, its subsidiaries and its projects, constitute forward-looking statements. The words ''believe'', ''expect'', ''anticipate'', ''target'', ''continue'', ''estimate'', ''may'', and similar expressions identify forward-looking statements. Forward-looking statements include, among other things, statements regarding anticipated future financial and operational performance, the ability to deliver commercial production at Young-Davidson in early Q3 and to reach annual production of 250,000 ounces by 2016, the ability to continue to fund expansion and exploration operations through cash flows, the ability of the Company to optimize and expand its operations and development projects through capital expenditure, the ability of the Company to complete its expansion studies in a timely manner and to achieve positive results therefrom, the ability to realize the perceived benefits of the acquisition of Capital Gold and Northgate, the ability of the Company to achieve its targets for the continued expansion and development of Ocampo and El Chanate, the future price of gold and silver and the ratio of their prices, the de-risking of operations, future exploration results of the Company's exploration and development programs and the success of the Company's exploration approaches, the Company's ability to delineate additional resources and reserves as a result of such programs, statements regarding the Company's financial exposure to litigation, targets, estimates and assumptions in respect of gold and silver production and prices, operating costs, results and capital expenditures, mineral reserves and mineral resources and anticipated grades, recovery rates, future financial or operating performance, margins, operating and exploration expenditures, costs and timing of the development and commencement of production of new deposits, costs and timing of construction, costs and timing of future exploration and reclamation expenses including, anticipated results for the periods set out within, operating performance projections for the periods set out within, the Company's ability to fully fund its business model internally, gold and silver production for the periods set out within and the cash and operating costs associated therewith, the ability to achieve productivity and operational efficiencies, and the timing of each thereof. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Company, are inherently subject to significant business, economic, competitive, political and social uncertainties and contingencies. The operating and financial performance of the Company will be affected by changes in the actual gold equivalency ratio realized for the periods set out within. Many factors could cause the Company's actual results to differ materially from those expressed or implied in any forward-looking statements made by, or on behalf of, the Company. Such factors include, among others, known and unknown uncertainties and risks relating to additional funding requirements, reserve and resource estimates, commodity prices, hedging activities, exploration, development and operating risks, illegal miners, political and foreign risk, uninsurable risks, competition, limited mining operations, production risks, environmental regulation and liability, government regulation, currency fluctuations, recent losses and write-downs, restrictions in the Company's loan facility, dependence on key employees, possible variations of ore grade or recovery rates, failure of plant, equipment or process to operate as anticipated, accidents and labour disputes. Investors are cautioned that forward-looking statements are not guarantees of future performance and, accordingly, investors are cautioned not to put undue reliance on forward-looking statements due to the inherent uncertainty therein.
SOURCE AuRico Gold Inc.