Digr whats your outtake on glamis??
I noticed that there debt free!!
Glamis Gold Achieves Record Gold Production And Reports Improved Outlook For 2001
RENO, Nev.--(BUSINESS WIRE)--Feb. 20, 2001--Glamis Gold Ltd. (NYSE:GLG - news; TSE:GLG. - news) is pleased to announce record 2000 gold production of 218,390 ounces and to report that its new San Martin Mine in Honduras moved into commercial production as of January 1, 2001.
This marks an important milestone for Glamis, as overall performance will be substantially improved by the combination of low-cost San Martin production and the closure of high cost mines during 2000.
Financial Highlights
The Company's earnings were essentially break-even in the fourth quarter of 2000 ($0.00 per share) before a non-cash provision of $37.5 million (after tax) to adjust the book value of certain assets consistent with the current gold price. For the year, the Company reported a loss of $6.8 million ($0.10 per share) before non-recurring provisions. Including all provisions, the net loss for 2000 was $48.7 million ($0.70 per share), compared to a loss of $21.6 million ($0.33 per share) in 1999. The Company ended 2000 with working capital of $20.5 million, including $13.3 million in cash and equivalents. Glamis remains debt free.
Revenue in 2000 was $61.6 million, a 9% increase over 1999 revenue of $56.7 million. The Company's average realized price per ounce of gold sold was $280 in 2000 compared to $278 in 1999. Cash flow from operations totaled $3.1 million in the fourth quarter and $5.4 million for the year ended December 31, 2000.
The non-cash accounting provisions resulted from a comprehensive review of all assets and the calculation of gold reserves at a gold price of $275 per ounce versus $300 used last year, and includes the following:
-- The carrying value of Rand Mine was reduced by $14.4 million,
net of taxes, reflecting a decision to mine only a portion of the
Stage 3 Yellow Aster pit in light of lower gold prices. The reserve
reduction at Rand is more than offset by the increase in reserves at
Marigold from the Millennium discovery.
-- The $8.0 million carrying value of the Cerro Blanco Project has
been written down. This asset was acquired in 1998 when gold prices
were much higher than today. While the Company will continue to hold
and work to improve the value of this project, its economics are such
that it will require higher gold prices to justify a development
decision.
-- Due to the Department of Interior decision on January 16, 2001
to formally deny the operating permit for the Imperial Project, the
$14.3 million value of the project has been written down and its
reserves reclassified as resources. Glamis will appeal this decision
and intends to vigorously pursue all available means to protect its
investment in this project.
``These non-cash adjustments reflect the reality of today's gold price environment, something already reflected in our share price,'' said Glamis' President and C.E.O. Kevin McArthur. ``We thoroughly reviewed every asset, and these adjustments will assure that our books match that reality. The Company has been greatly simplified with the closure of two high cost mines in 2000, and we now look forward to the prospect of record gold production and cash flow from operations, and a return to positive earnings in 2001.''
Operations Highlights
Gold production for 2000 was a record 218,390 ounces, an increase of 42,496 ounces, or 24%, compared to 1999. Total cash costs of production in 2000 were $222 per ounce, compared to $219 per ounce in 1999. During the fourth quarter, Glamis produced 57,957 ounces at a total cash cost of $194 per ounce.
San Martin Mine
San Martin Mine produced 3,562 ounces of gold during its pre-production period ending December 31,2000. No cost of production is associated with those ounces, as commercial production commenced January 1, 2001. San Martin is expected to produce 113,000 ounces of gold in 2001 at a total cash cost of $113 per ounce, significantly lowering the Company's average total cash cost of production.
Marigold Mine (66 2/3% Glamis-owned)
Marigold produced 43,655 gold ounces for the Company's account for the year ended December 31, 2000, entirely from heap leaching operations following closure of the mill in 1999. The cash cost per ounce at Marigold was $240 for the year ending December 31, 2000 compared to $218 for 1999, reflecting ore supply problems in the second and third quarters that have since been resolved. For the quarter ending December 31, 2000, the total cash cost was $208 per ounce, the same as the prior year.
Looking forward, Marigold is expected to produce 48,000 ounces for Glamis' account during 2001 at $200 per ounce total cash cost. Approximately 470,000 ounces of proven and probable reserves from the Millennium Project were added at Marigold in 2000. The deposit remains open at depth and along strike, and drilling to further define the mineralization recommenced in early February 2001.
Rand Mine
Production from Rand for the year ended December 31, 2000 increased 41%, to a record 99,936 gold ounces compared to 70,978 ounces in the year ended December 31, 1999. Production during the quarter ending December 31, 2000 was 25,540 ounces compared to 31,829 ounces in the quarter ending December 31, 1999. Total cash cost per ounce at Rand for the year ended December 31, 2000 decreased 16%, to $176, compared to $210 in 1999. For the fourth quarter, the total cash cost was $190 per ounce compared to $163 in the quarter ended December 31, 1999.
Rand's production will decrease in 2001 as the final stripping of the Stage 3 Yellow Aster pit is completed. Rand is expected to produce 75,000 ounces of gold in 2001 at a total cash cost of $219 per ounce.
Mine Closures and Reclamation
Glamis announced the closure of the Dee and Daisy mines in 2000. Gold production from these closed operations in 2000 was 69,805 ounces at an average total cash cost of $277 per ounce. Several successful years of intensive reclamation at Dee will now result in two more years of moderate closure activity. A small amount of reclamation work remains at the Daisy and Picacho properties, and should be completed in 2001.
Mineral Reserves and Resources
Mineral reserves have been calculated as at December 31, 2000 based on a gold price of $275 per ounce, versus $300 per ounce for the Company's December 31, 1999 reserves.
Excluding Imperial Project reserves, which were reclassified as mineral resources, total proven and probable ore reserves at December 31, 2000 reflect a 21% increase in contained gold ounces. Increases are due to the addition of Cerro San Pedro and to the discovery of the new Millennium gold zone at Marigold.
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Proven and Probable Reserves as of December 31, 2000 (1)
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Mine Tons Grade Contained Ounces
(opt)
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San Martin 41,948,700 0.025 1,035,600
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Marigold (66.7%) 20,173,900 0.035 709,600
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Rand 11,393,000 0.020 232,700
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Cerro San Pedro* (50%) 27,134,600 0.029 781,000
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Total P&P Reserves 100,650,200 0.027 2,758,900
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*Gold equivalent ounces
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Measured and Indicated Resources as of December 31, 2000 (2)
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Deposit Tons Grade Contained Ounces
(millions) (opt)
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San Martin 3.8 0.070 265,500
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Marigold (66.7%) 13.8 0.029 401,467
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Rand 21.4 0.020 429,300
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Cerro San Pedro (50%) 14.2 0.017 239,150
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Imperial Project 179.3 0.017 3,000,100
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Total Measured &
Indicated Resource 232.5 0.019 4,335,517
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Measured and Indicated Resources are in addition to
Proven and Probable Reserves
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Mineral Reserve and Mineral Resource Notes:
1. Mineral reserves ``Proven and Probable Reserves'', and mineral resources ``Measured and Indicated Resources'', have been calculated as at December 31, 2000 in accordance with definitions adopted by the Canadian Institute of Mining, Metallurgy and Petroleum on August 20, 2000. Except as otherwise noted, calculations have been prepared by employees of Glamis Gold Ltd. under the supervision of James S. Voorhees, Vice President of Operations and COO. These calculations were based on an assumed long-term gold price of $275 per ounce and a silver price of $5.00 per ounce and incorporate current or expected operating costs at each mine. Reserves at San Martin were based on cut-off grades of 0.010 oz/ton for oxide blanket reserves, 0.009 oz/ton for oxide non-blanket reserves, 0.015 oz/ton for non-oxide reserves. At Marigold the cut-off grade used was 0.010 oz/ton for all reserves. At Rand the cut-off grade used was 0.008 oz/ton. At Cerro San Pedro the cut-off grade used was 0.008 oz/ton equivalent. All proven and probable reserves have been verified by an independent audit with the exception of Marigold.
2. Resources that are not reserves do not have demonstrated economic viability.
Outlook for 2001
Another record production year with significantly reduced costs is forecast for 2001, with all production coming from three mines: San Martin, Marigold and Rand. Gold production is expected to total 235,000 ounces at a total cash cost of $165 per ounce.
The Company is conducting an analyst and stockholder tour at its San Martin Mine in Honduras this week. Materials presented in conjunction with the tour will be posted on the Company web site (www.glamis.com) at 10:00 a.m. PDT today.
Please see the complete 2000 Financial Statements that follow.
Safe Harbor Statement under the United States Private Securities Litigation Reform Act of 1995: Except for the statements of historical fact contained herein, the information presented constitutes ``forward-looking statements'' within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements, including but not limited to those with respect to the price of gold, estimated future production, operating and capital costs and permitting time lines, involve known and unknown risks, uncertainties, and other factors that may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. These factors include, among others, the factual results of current exploration activities, conclusions of feasibility studies now underway, changes in project parameters as plans continue to be refined, future prices of gold, as well as those factors discussed in the section entitled ``Other Considerations'' in the Company's Annual Report on Form 10-K.
Email requests for investor packets to: info@glamis.com
Financial Highlights
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Three Months Twelve Months
Ended Ended
December 31, December 31,
2000 1999 2000 1999
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Gold production
- ounces
Picacho Mine 1,043 1,187 1,432 6,684
Rand Mine 25,540 31,829 99,936 70,978
Daisy Mine * 499 9,882 8,740 28,302
Dee Mine * 15,353 8,123 61,065 31,154
Marigold Mine * 11,960 14,291 43,655 37,942
San Martin (2000)
--Cieneguita (1999) 3,562 -0- 3,562 834
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Total 57,957 65,312 218,390 175,894
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Revenue realized
per ounce $ 278 $ 294 $ 280 $ 278
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Total cash cost
per ounce of
production
Picacho Mine $ 272 $ 165 $ 254 $ 172
Rand Mine $ 190 $ 163 $ 176 $ 210
Daisy Mine * $ 181 $ 121 $ 208 $ 195
Dee Mine * $ 183 $ 328 $ 287 $ 273
Marigold Mine * $ 209 $ 209 $ 240 $ 218
Company Average $ 194 $ 187 $ 222 $ 219
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Total cost per ounce
of production
Picacho Mine $ 213 $ 330 $ 275 $ 282
Rand Mine $ 272 $ 249 $ 251 $ 299
Daisy Mine * $ 268 $ 248 $ 299 $ 312
Dee Mine * $ 306 $ 456 $ 346 $ 315
Marigold Mine * $ 252 $ 252 $ 290 $ 268
Company Average $ 276 $ 277 $ 288 $ 297
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Working capital
(thousands) $ 20,546 $ 61,284 $ 20,546 $ 61,284
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Net cash provided
by (used in)
operations
(thousands) $3,099 $ 9,497 $ 5,415 $ 6,191
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Net earnings (loss)
for the period
(thousands) $ (37,533) $ (12,668) $ (48,682) $ (21,632)
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Net cash provided
by (used in)
operations per
share $ 0.05 $ 0.14 $ 0.08 $ 0.10
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Earnings (loss) per
share $ (0.54) $ (0.19) $ (0.70) $ (0.33)
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Average shares
outstanding 70,097,382 69,686,282 70,019,995 64,100,787
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* Includes the results of Marigold, Dee and Daisy operations for only
ten months in 1999 - - March through December.
Consolidated Balance Sheets
(Expressed in thousands of U.S. dollars)
December 31, December 31,
2000 1999
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Assets
Cash $13,278 $55,169
Other current assets 15,743 13,737
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Current assets 29,021 68,906
Plant and equipment and mine
development costs, net 77,530 88,900
Other assets 5,990 5,579
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$112,541 $163,385
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Liabilities
Current liabilities $ 8,475 $7,622
Long term liabilities 21,296 17,906
Shareholders' equity
Share capital:
Authorized:
200,000,000 common
shares without par value
5,000,000 preferred shares,
$10 par value,
issuable in Series
Issued and fully paid:
70,097,382 common shares
(1999-69,864,832) 159,045 158,717
Contributed surplus 63 63
Deficit (76,338) (20,923)
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82,770 137,857
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$112,541 $163,385
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Consolidated Statements of Operations
(Expressed in thousands of U.S.
dollars, except per share amounts)
Three Months Twelve Months
Ended Ended
December 31, December 31,
2000 1999 2000 1999
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Revenue from
production $15,748 $18,300 $61,560 $56,727
Cost of production 10,864 13,831 47,884 47,698
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4,884 4,469 13,676 9,029
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Expenses
Depreciation
& depletion 4,053 5,106 13,610 14,156
Reclamation 149 562 819 1,273
Exploration 404 1,898 2,887 4,002
Selling, general,
administration 963 1,375 5,166 5,989
Write-down of
investments and
properties 41,618 8,223 45,963 8,223
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47,187 17,164 68,445 33,643
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Loss from operations (42,303) (12,695) (54,769) (24,614)
Interest expense 4 (106) 22 160
Other (income)
expense (630) ( 971) (2,045) (2,890)
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Loss before taxes (41,677) (11,618) (52,746) (21,884)
Provision for
(benefit from) taxes (4,144) 1,050 (4,064) (252)
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Loss for the period $(37,533) $(12,668) $(48,682) (21,632)
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Loss per share $(0.54) $(0.19) $(0.70) $(0.33)
Consolidated Statements of Cash Flows
(Expressed in thousand of U.S. dollars)
Three Months Twelve Months
Ended Ended
December 31, December 31,
2000 1999 2000 1999
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Cash flows from
(used in)
Operating activities
Loss for the period $(37,533) $(12,668) $(48,682) $(21,632)
Adjustment for items
not affecting working
capital 40,987 10,430 55,250 22,770
Net changes in
non-cash working
capital (355) 11,735 (1,153) 5,053
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Net cash provided by
(used in) operations 3,099 9,497 5,415 6,191
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Cash flows from
(used in) investing
activities
Capital expenditures (8,365) (2,359) (38,900) 33,434
Business acquisitions 345 25,526 (6,808) (8,189)
Other assets (543) (3,688) (1,926) (441)
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Net investment
activities (8,563) 19,479 (47,634) 24,804
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Cash flows from
(used in)financing
activities
Stock issues --- 1,077 328 2,211
Notes payable --- (5,126) --- (4,207)
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Net financing
activities -0- (4,049) 328 (1,996)
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Increase (decrease)
in cash (5,464) 24,927 (41,891) 28,999
Cash, beginning
of period 18,742 30,242 55,169 26,170
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Cash, end of period $13,278 $55,169 $13,278 $55,169
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Consolidated Statements of Retained Earnings (Deficit)
(Expressed in thousand of U.S. dollars)
Three Months Twelve Months
Ended Ended
December 31, December 31,
2000 1999 2000 1999
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Retained earnings
(deficit)
Beginning of period
As previously
reported $(38,805) $(8,255) $(20,576) $709
Adjustment for
revenue recognition --- --- (347) ---
Restated for revenue
recognition (38,805) (8,255) (20,923) 709
Adjustment for future
income taxes --- --- (6,733) ---
As restated (38,805) (8,255) (27,656) 709
Net loss for
the period (37,533) (12,668) (48,682) (21,632)
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Deficit, end
of period $(76,338) $(20,923) $(76,338) (20,923)
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