Alta Gold Co. Announces 17th Consecutive Quarterly Profit
HENDERSON, Nev.--(BUSINESS WIRE)--Aug. 4, 1998--Alta Gold Co. (Nasdaq/NM:ALTA) Tuesday announced financial results for the second quarter and the six months ended June 30, 1998.
For the second quarter of 1998, the company reported net income of $114,000 ($0.00 per share) from revenue of $3,221,000. For the second quarter of 1997, net income totaled $944,000 ($0.03 per share), including an extraordinary gain of $784,000 ($0.03 per share basic, $0.02 per share diluted) from a gain on extinguishment of debt, from revenue of $2,991,000.
For the six months ended June 30, 1998, the company reported net income of $480,000 ($0.02 per share basic, $0.01 per share diluted) from revenue of $6,845,000. For the six months ended June 30, 1997, net income totaled $1,023,000 ($0.04 per share basic, $0.03 per share diluted), including an extraordinary gain of $784,000 ($0.03 per share basic, $0.02 per share diluted) from a gain on extinguishment of debt, from revenue of $5,849,000.
Income from operations increased from $72,000 in the second quarter of 1997 to $135,000 in the second quarter of 1998 and from $121,000 in the first half of 1997 to $459,000 in the first half of 1998.
Cash flow from operations also improved by $2,240,000 from a negative cash flow of $633,000 in the first half of 1997 to a positive cash flow of $1,607,000 in the first half of 1998. Working capital also improved by $3,182,000, from $2,538,000 as of Dec. 31, 1997 to $5,720,000 as of June 30, 1998.
Robert N. Pratt, president and chief executive officer of Alta Gold, stated: "We are very pleased to be able to report a profit for the second quarter of 1998, especially in light of the severe weather conditions faced at Griffon and Kinsley as a result of El Nino.
"Griffon production costs of $142/ounce are remarkable under these conditions and are a reflection of the quality of this ore body and the hard work of our employees. With the bad weather behind us, we anticipate an improvement in production at both Griffon and Kinsley in the third quarter of 1998. At Olinghouse, construction is on schedule and under budget with initial production anticipated in August.
"Olinghouse will have a major impact on gold production and cash flow in the second half of 1998."
Production statistics for Griffon and Kinsley were as follows for the following periods: -0- *T
Three Months Ended Six Months Ended
June 30, June 30, 1998 1997 1998 1997
Griffon (a) Total Tons Mined 531,561 -- 1,213,602 -- Ore Tons Mined 401,253 -- 809,586 -- Average Grade 0.0336 -- 0.0337 -- Oz Gold Mined 13,483 -- 27,305 -- Oz Gold Produced 7,590 -- 14,680 -- Cash Cost per Oz $ 142 -- $ 144 --
Kinsley (b) Total Tons Mined -- 1,647,263 527,492 2,870,687 Ore Tons Mined -- 453,245 93,738 870,317 Average Grade -- 0.0337 0.0334 0.0326 Oz Gold Mined -- 15,283 3,135 28,334 Oz Gold Produced 2,417 8,751 5,937 16,843 Cash Cost per Oz $ 307 $ 207 $ 288 $ 214 *T
(a) Gold production at Griffon began in January 1998.
(b) Mining was completed at Kinsley in March 1998.
Alta Gold is engaged in the exploration, development, mining and production of gold on properties in Nevada. The company also has three base metals properties in the western United States which are in various stages of development.
This news release contains statements that may be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, such as management's expectations regarding scheduled gold production from and the overall economics of the company's mining properties. Such forward-looking statements are inherently uncertain, and the actual results may differ from management's expectations. Further information on potential factors which could affect the financial condition and results of operations of the company are included in the filings of the company with the Securities and Exchange Commission, including, but not limited to, the company's Annual Report On Form 10-K for the fiscal year ended Dec. 31, 1997. -0- *T
ALTA GOLD CO.
Condensed Balance Sheets
(unaudited)
June 30, Dec. 31, 1998 1997 Current Assets: Cash and cash equivalents $ 1,788,000 $ 3,330,000 Inventories 8,764,000 8,152,000 Prepaid expenses and other 291,000 157,000
Total current assets 10,843,000 11,639,000 Property and Equipment 33,289,000 26,928,000 Deferred Mine Development Costs 24,582,000 22,896,000 Deferred Financing Costs 2,490,000 625,000 Other Assets 619,000 898,000
Total Assets $ 71,823,000 $ 62,986,000
Current Liabilities: Accounts payable $ 829,000 $ 829,000 Accrued liabilities 803,000 790,000 Current portion of long-term debt 3,491,000 7,482,000
Total current liabilities 5,123,000 9,101,000 Long-term Debt, net of current portion 20,605,000 11,910,000 Deferred Income Taxes 662,000 662,000 Other Long-term Liabilities 1,196,000 1,514,000
Total liabilities 27,586,000 23,187,000
Stockholders' Equity: Common stock 32,000 30,000 Additional capital 50,571,000 46,615,000 Accumulated deficit (6,366,000) (6,846,000) Total stockholders' equity 44,237,000 39,799,000
Total liabilities and
stockholders' equity $ 71,823,000 $ 62,986,000
ALTA GOLD CO.
Condensed Statements of Operations
(unaudited)
Three Months Ended Six Months Ended
June 30, June 30, 1998 1997 1998 1997 Revenue: Sales of Gold $3,221,000 $2,991,000 $6,845,000 $5,849,000
Operating Costs and Expenses: Direct mining, production, reclamation and
maintenance costs 2,618,000 2,472,000 5,562,000 4,856,000 General and
administrative 401,000 386,000 708,000 785,000 Exploration 67,000 61,000 116,000 87,000
3,086,000 2,919,000 6,386,000 5,728,000 Income From Operations 135,000 72,000 459,000 121,000 Other Income (Expense): Interest income
and other 20,000 88,000 62,000 118,000 Loss on disposal
of assets (41,000) -- (41,000) -- (21,000) 88,000 21,000 118,000 Income Before Provision for Income Taxes and Extraordinary Item 114,000 160,000 480,000 239,000 Provision for Income Taxes -- -- -- -- Income Before Extraordinary Item 114,000 160,000 480,000 239,000
Extraordinary Item: Gain on extinguishment
of debt -- 784,000 -- 784,000
Net Income $ 114,000 $ 944,000 $ 480,000 $1,023,000
Earnings Per Share: Income before
extraordinary item -- Basic $ -- $ 0.01 $ 0.02 $ 0.01
Diluted $ -- $ -- $ 0.01 $ 0.01
Net Income -- Basic $ -- $ 0.03 $ 0.02 $ 0.04
Diluted $ -- $ 0.03 $ 0.01 $ 0.03
Weighted Average Shares Outstanding: Basic 32,515,538 29,204,092 31,973,852 29,118,086
Diluted 35,548,666 33,214,836 35,421,320 31,870,164
ALTA GOLD CO.
Condensed Statements of Cash Flows
(unaudited) Six Months Ended
June 30, 1998 1997 Cash Flows From Operating Activities: Net income $ 480,000 $ 1,023,000 Adjustments to reconcile
net income to net cash
provided by (used in) operating activities: Depreciation, depletion
and amortization 1,526,000 1,006,000
Loss on disposal of assets 41,000 -- Gain on extinguishment of debt -- (784,000) Decrease (increase) in -- Inventories (612,000) (1,210,000) Prepaid expenses and other 145,000 346,000
Increase (decrease) in -- Accounts payable -- (788,000) Accrued and other liabilities 27,000 (226,000) Net cash provided by (used in) operating activities 1,607,000 (633,000)
Cash Flows From Investing Activities: Additions to property, buildings
and equipment (7,453,000) (1,451,000) Additions to deferred mine
development costs (1,670,000) (3,055,000) Net cash used in investing activities (9,123,000) (4,506,000)
Cash Flows From Financing Activities: Proceeds from issuance of debt 17,215,000 17,978,000 Payments on debt (8,961,000) (5,900,000) Financing costs (2,280,000) (929,000) Proceeds from exercise of stock options -- 185,000
Net cash provided by financing activities 5,974,000 11,334,000
Net Increase (Decrease) in Cash and Cash Equivalents (1,542,000) 6,195,000
Cash and Cash Equivalents, beginning of period 3,330,000 518,000
Cash and Cash Equivalents, end of period $ 1,788,000 $ 6,713,000 *T
CONTACT:
Alta Gold Co., Henderson
Margo Bergeson, 702/433-8525
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