Aurcana Reports Record Results for Q2, 2012
VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 20, 2012) - Aurcana Corporation ("Aurcana" or the "Company") ( AUN.V)( AUNFF)( AUNFF) today is pleased to report its unaudited financial results for the second quarter ending June 30, 2012. The summary of the selected financial information should be read in conjunction with the unaudited financial statements and the related management's discussion and analysis dated August 17, 2012 together referred to as the "Financial Statements", which have been filed on SEDAR ( www.sedar.com) and the Company's website (http://www.aurcana.com/). All figures are in US dollars unless otherwise noted.
The Q2 2012 Earnings Conference Call has been scheduled at 2:00 pm Eastern Time (11:00am Pacific) on Monday, August 20, 2012. See bottom of press release for details. "We are very pleased to report to investors record results for the second quarter of 2012. The results achieved this quarter highlight the success of the Company in building La Negra into a profitable producing mine. They are a clear testament that Aurcana is well on its way to becoming a mid-tier silver producer and the progress to date has been outstanding. The commissioning and testing of the mine at Shafter is making continuous progress," said Lenic Rodriguez, Aurcana's President & CEO.
The significant operating highlights for Q2, 2012 related to the Company's ongoing mining operations at La Negra were:
-- 7% increase in net revenues to $13.3 million compared to $12.4 million
for the second quarter of 2011.
-- 4% increase in earnings from mining operations to $5.5 million compared
to $5.3 million for the second quarter of 2011.
-- 50% increase in net income to $3.4 million for the first six months of
2012 compared to $2.3 million for the first six months of 2011.
-- 106% increase in operating cash flow before movements in working capital
items, to $4.7 million compared to $2.3 million for the second quarter
of 2011.
-- 18% increase in milled tonnes processed for a total of 307,161 during
the six months ended June 30, 2012 (2011: 260,931); of which 15% (45,588
tonnes) were mined from NI 43-101 Measured and Indicated resources and
85% (261,573 tonnes) were mined from new discoveries.
-- 23% increase in silver ounces sold for the second quarter of 2012 to
323,307 (373,037 ounces produced) from 263,357 silver ounces in 2011.
-- Metal prices were a significant factor in revenues of the Company. Due
to a general economic slowdown, average silver prices in the second
quarter of 2012 were $28.51 compared to $36.86 per ounce in the second
quarter of 2011.
-- 52% increase in silver equivalent ounces produced to 690,162 in the
second quarter of 2012 (2011: 455,516).
Earnings
The Company had earnings from La Negra mining operations of $5.5 million for the quarter ended June 30, 2012 (2011: $5.3 million); income before taxes of $2.0 million (2011: $1.7 million); a net income of $1.4 million (2011: $1.6 million). For the six months ended June 30, 2012 the Company had earnings from mining operations to $11.0 million (2011: $10.7 million); income before taxes to $4.6 million (2011: $3.3); a net income of $3.4 million (2011: $2.3 million).
The increase in earnings from La Negra mining operations was mainly related to increased volumes sold and the increase in the higher grades of the metals in the concentrates produced by the Company, in spite of lower metals prices.
Revenue
During the year ended June 30, 2012, the Company generated revenues from La Negra mining operation for the sale of 2,425 tonnes of copper concentrate (2011: 1,832 tonnes); 4,244 tonnes of zinc concentrate (2011: 2,667 tonnes); 945 tonnes of Lead Concentrate (2011:846) and 323,307 ounces of silver (2011: 263,357 ounces) for total net revenues of $13.7 million (2011: $12.4 million).
The average price for sales of copper, silver, zinc and lead during the second quarter were Cu $3.52 (2011: $4.14) per pound; Ag $28.51 (2011: $36.86) per ounce; Zn $0.86 (2011: $1.02) per pound and Pb $0.89 (2011: $1.16) per pound.
La Negra Mine Production Highlights
-- 32% increase in tonnes of ore processed during the second quarter of
2012 to 176,591 (2011: 133,700).
-- 45% increase in silver ounces produced during the second quarter of 2012
to 373,037 (2012: 257,508).
-- 44% increase in copper, zinc and lead concentrate produced during the
second quarter of 2012 to 7,751 tonnes (2011: 5,391 tonnes).
-- Achieved 26% decrease in production costs per silver equivalent to $8.43
(2011: $11.47).
-- La Negra's production increase was supported by a continuous in-house
diamond drilling program.
Mining operations and exploration drilling at La Negra continue to delineate additional mineralized zones, either between or as extensions of existing ore zones. These results have the potential to add to the mine life of La Negra. Drill crews have completed 5,968 metres of diamond drilling during the six months ended June 30, 2012.
La Negra mine completed its second consecutive mill expansion from a capacity of 1,500 tonnes per day (tpd) to 2,500 tpd on time and on budget in April, 2012. The planned milling rate is 2,000 tpd and La Negra continuously exceeded the planned rate in Q2, 2012, with a goal to grow up to 2,500tpd.
Shafter Silver Mine Updates
-- Commissioning and testing of the processing plant continues at the
Shafter Silver Mine in Texas. As a result of the testing to date, two
key areas have been identified for improvement; further mine development
and the processing plant mill dewatering. In addition, during this
testing phase we are continuing to upgrade and train the mining
personnel at Shafter.
-- The underground production will be supplemented by a test open pit until
the fourth quarter of 2012 as further development is required in order
to sustain 1,500 tons per day. Further development of the underground
mine is currently under review.
-- During the second quarter of 2012, the deferred stripping of a small
test open pit was started. The mineralized rock is expected to be
processed starting in late August 2012.
-- Resulting from the commissioning test in Q2 2012, the dewatering process
of the processing plant is currently being re-configured. The processing
plant continues testing to reach 1,500 tons per day as anticipated, and
will be ready in the fourth quarter of 2012.
Summary
During Q2 2012 Aurcana completed the expansion of the La Negra mill capacity to 2,500 tpd. Production increases continued at La Negra and revenues increased even with the significant drop in metal prices. The Company continued to adjust its cost structure, both on the operational and administrative side. At Shafter the processing plant was commissioned in Q2, 2012 and testing continues with expectation of commercial production in the 4th quarter of 2012. Full capacity of 2,500 tpd will be achieved during 2013 at Shafter. Aurcana is prepared for significant increases in production and further growth in 2012 and beyond.
To read complete Financial Statement click on this link: docs.google.com
To read complete MD&A click on this link: docs.google.com
Aurcana Corporation is scheduling a conference call to discuss the audited second quarter 2012 results at 11:00 AM Pacific on Monday, August 20th, 2012.
Conference Call Details:
Date: Monday, August 20th, 2012
Time: 2:00 PM EDT (11:00 AM Pacific)
Attendee Access Information:
1-800-319-4610 Canada and USA Toll-free
604-638-5340 Vancouver
1-604-638-5340 Outside of Canada & USA
A replay of the conference call will be available immediately following the conference by dialing 1-800-319-6413 in Canada & USA (Toll-free) or 1-604-638-9010 outside of Canada and USA. The required pass code is 2729 followed by the # sign. Please dial-in to the meeting at least 5 minutes prior to the start time using one of the attendee phone numbers.
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