Bema Gold Corporation - 2002 Second Quarter Results
VANCOUVER, Aug. 27 /CNW/ - Bema Gold Corporation ("Bema" or the
"Company") reports results from its operations for the second quarter ended
June 30, 2002.
Financials
The Company reported net earnings of $4 million (two cents per share) on
revenue of $7.5 million for the second quarter of 2002 compared to a net loss
of $2.2 million (one cent per share) on revenue of $7.1 million for the second
quarter of 2001. Included in earnings for the second quarter 2002 are $3.9
million of settlement amounts relating to the Refugio Mine construction
arbitration settlement and $2.8 million relating to a reversal of a notes
receivable provision.
For the first six months of 2002, the Company reported net earnings of
$2.5 million (one cent per share) on revenue of $16.6 million compared to a
net loss of $5.1 million (three cents per share) on revenue of $14.9 million
in 2001.
Operations
Bema's operating cash cost for the second quarter of 2002 was $138 per
ounce of gold on production of 30,294 ounces compared to $224 per ounce on
production of 22,726 ounces in the second quarter of 2001. For the six months
ended June 30, 2002, the Company's gold production was 59,575 ounces at an
operating cash cost per ounce of $132 compared to 48,486 ounces at $227 per
ounce in the first half of 2001. Total cash costs per ounce for the first six
months were $170 in 2002 and $233 in 2001.
In the second quarter 2002, the Julietta Mine, located in Far East
Russia, produced 28,383 ounces of gold at an operating cash cost of $129 per
ounce and a total cash cost of $171 per ounce compared to first quarter 2002
production of 22,717 ounces at an operating cost per ounce of $130 and a total
cash cost per ounce of $173. Cash costs are forecast to continue to decrease
for the remainder of the year, as mill modifications and training to improve
the efficiency of the mine work force should result in increased production
levels and reduced costs.
Bema's share of the Refugio Mine's second quarter 2002 gold production
was 1,911 ounces produced in April and May at an operating cost per ounce of
$272 and a total cash cost per ounce of $279 versus 6,564 ounces of gold
produced in the first quarter 2002 at an operating cost per ounce of $116 and
total cash cost per ounce of $123. As planned, the ADR processing plant at
Refugio was shut down for the winter on June 3, 2002 and the joint venture
partners are currently discussing the matter of restarting the plant in the
fall of 2002. In the second quarter 2001, the Company's share of Refugio
production totaled 22,726 gold ounces at an operating cost per ounce of $224
and a total cash cost per ounce of $229. The lower production at the Refugio
Mine in 2002 was the result of the suspension of mining activities and
commencement of residual leaching on June 1, 2001.
Bema realized a 3% increase in gold production during second quarter of
2002 however gold revenue was 17% lower than the previous quarter due to the
delay in gold sales towards the end of the second quarter. These delays are
attributed to the fact that, during the quarter, the Company began the process
of exporting its gold rather than selling its gold to Russian banks. Proceeds
from the Julietta Mine's first gold export, which occurred in July, were
received at the beginning of August. Management anticipates that the timing of
the receipt of sales proceeds from future export shipments will improve as
minor procedural issues are resolved.
Capital Resources
At June 30, 2002, the Company had $20.4 million in cash and cash
equivalents compared to $2.7 million at the end of the previous quarter and
$4.1 million as at December 31, 2001. The bulk of the increase in cash was
from the completion of a brokered share offering for net proceeds of $15.2
million and the exercise of warrants totaling $4.5 million as a result of the
improved gold equity market and a dramatic increase in Bema's share price. The
Company's working capital at the end of the second quarter 2002 was $28.8
million versus $556,000 at the end of 2001. Furthermore, during the quarter,
the Company reduced its convertible debt by $13.3 million to $3 million as the
holders of debentures converted to common shares. Subsequent to the second
quarter, an additional $2 million has been converted leaving the remaining
convertible debt at $1 million.
Refugio Mine Construction Arbitration Settlement
During the quarter ended June 30, 2002, Compania Minera Maricunga
("CMM"), the Company's 50% owned joint venture in Chile, received a favourable
ruling, settled by binding arbitration, on its claims against Fluor Daniel
Chile Ingenieria y Construccion S.A, Fluor Daniel Corporation, and Fluor
Daniel Wright Ltd. ("Fluor") for damages relating to the original construction
of the Refugio Mine. The net award to CMM is approximately $20 million (Bema's
share - $10 million), of which approximately $10 million is being contested by
Fluor through the normal legal process available in Chile. CMM anticipates
payment of the uncontested amount of net $10 million (after legal fees) before
the end of the third quarter. Bema remains confident that the full amount of
the award shall be received within a six to twelve-month period and has
accrued for the full amount of the award. The Company credited $3.9 million,
relating to consequential damages, of the award settlement to operating
earnings. The remainder of the settlement was credited to the carrying cost of
the property and against legal and arbitration costs.
Outlook
The Company will remain focused on maximizing production at the Julietta
Mine and advancing its exploration and development projects. Development and
exploration drilling are ongoing at Julietta with the intention of expanding
reserves and exploring the ultimate potential of the property. In September
2002 Bema is commencing a diamond drilling program at the Monument Bay
property in Manitoba Canada with the intention of increasing the current high
grade resource containing 300,000 ounces of gold. The Company is also actively
pursuing acquisition opportunities for high grade gold properties in Russia
and elsewhere. In addition to direct property acquisitions, management is
reviewing and evaluating potential corporate acquisitions and merger. With the
recent increase in the gold price, the Company and its joint venture partner
are currently reviewing the economic feasibility of recommencing mining at the
Refugio Mine in Chile.
All dollar amounts are expressed in United States dollars unless
otherwise noted.
On behalf of BEMA GOLD CORPORATION
"Clive T. Johnson"
Chairman, C.E.O., & President
The Toronto Stock Exchanges neither approves nor disapproves the
information contained in this News Release, Bema Gold Corporation trades on
The Toronto and American stock exchanges. Symbol: BGO.
Some of the statements contained in this release are forward-looking
statements, such as estimates and statements that describe the Company's
future plans, objectives or goals, including words to the effect that the
Company or management expects a stated condition or result to occur. Since
forward-looking statements address future events and conditions, by their very
nature, they involve inherent risks and uncertainties. Actual results in each
case could differ materially from those currently anticipated in such
statements.
<<
BEMA GOLD CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands of United States dollars)
As at As at
June 30 December 31
2002 2001
(unaudited) (audited)
ASSETS
Current
Cash and cash equivalents $ 20,379 $ 4,133
Accounts receivable 1,493 2,529
Marketable securities 4,388 2,352
Inventories 9,665 6,405
Arbitration settlement receivable 10,529 -
Other 619 147
--------- ---------
47,073 15,566
Notes receivable from associated company 2,924 -
Investments 2,118 2,525
Property, plant and equipment 140,818 149,160
Other assets 12,473 15,341
--------- ---------
$205,406 $182,592
--------- ---------
--------- ---------
LIABILITIES
Current
Accounts payable $ 3,590 $ 5,426
Current portion of long-term debt 14,666 9,584
--------- ---------
18,256 15,010
Deferred revenue 176 103
Long-term debt 25,834 33,910
Other liabilities 4,480 3,937
--------- ---------
48,746 52,960
--------- ---------
SHAREHOLDERS' EQUITY
Capital stock 300,413 265,080
Convertible debt, net of costs 3,152 13,697
Deficit (146,905) (149,145)
--------- ---------
156,660 129,632
--------- ---------
$205,406 $182,592
--------- ---------
--------- ---------
Approved by the Directors
"Clive T. Johnson" "R. Stuart Angus"
Clive T. Johnson R. Stuart Angus
BEMA GOLD CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
For the periods ended June 30
(Unaudited)
(in thousands of United States dollars, except shares and
per share amounts)
Second Quarter Six Months
2002 2001 2002 2001
---- ---- ---- ----
GOLD REVENUE $ 7,529 $ 7,075 $ 16,602 $ 14,902
-------- -------- -------- --------
EXPENSES (INCOME)
Operating costs 4,675 5,289 9,239 11,565
Depreciation and depletion 2,449 1,840 5,341 3,886
Insurance proceeds (14) (361) (14) (361)
Other 147 954 211 1,027
-------- -------- -------- --------
7,257 7,722 14,777 16,117
Arbitration settlement (3,907) - (3,907) -
-------- -------- -------- --------
3,350 7,722 10,870 16,117
-------- -------- -------- --------
OPERATING EARNINGS (LOSS) 4,179 (647) 5,732 (1,215)
-------- -------- -------- --------
OTHER EXPENSES (INCOME)
General and administrative 901 711 1,559 1,375
Interest on long-term debt 1,072 248 2,258 577
Amortization of deferred
financing costs 992 645 1,985 1,290
General exploration 172 98 231 243
Other 99 (245) 426 264
-------- -------- -------- --------
3,236 1,457 6,459 3,749
-------- -------- -------- --------
EARNINGS (LOSS) BEFORE THE
UNDERNOTED ITEMS 943 (2,104) (727) (4,964)
Equity in losses of
associated companies (390) (48) (407) (98)
Reversal of notes
receivable provision 2,815 - 2,815 -
Investment gains (losses) 614 (60) 835 (60)
-------- -------- -------- --------
NET EARNINGS (LOSS)
FOR THE PERIOD $ 3,982 $ (2,212) $ 2,516 $ (5,122)
-------- -------- -------- --------
-------- -------- -------- --------
EARNINGS (LOSS) PER COMMON SHARE
- basic and diluted $ 0.02 $ (0.01) $ 0.01 $ (0.03)
-------- -------- -------- --------
-------- -------- -------- --------
Weighted average number
of common shares
outstanding (in thousands) 211,014 165,955 198,546 164,469
-------- -------- -------- --------
-------- -------- -------- --------
BEMA GOLD CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the periods ended June 30
(Unaudited)
(in thousands of United States dollars)
Second Quarter Six Months
2002 2001 2002 2001
---- ---- ---- ----
OPERATING ACTIVITIES
Net earnings (loss)
for the period $ 3,982 $ (2,212) $ 2,516 $ (5,122)
Non-cash charges (credits)
Depreciation and depletion 2,449 1,840 5,341 3,886
Amortization of deferred
financing costs 992 645 1,985 1,290
Equity in losses of
associated companies 390 48 407 69
Amortization of
deferred revenue 76 (842) 73 (1,770)
Investment (gains) losses (614) 60 (835) 60
Arbitration settlement (3,907) - (3,907) -
Reversal of notes
receivable provision (2,815) - (2,815) -
Other 42 (116) 333 417
-------- -------- -------- --------
Cash provided by (used in)
operating activities 595 (577) 3,098 (1,170)
Change in non-cash
working capital (301) 151 (2,209) 2,644
-------- -------- -------- --------
Cash provided by (used in)
operating activities after
changes in non-cash
working capital 294 (426) 889 1,474
-------- -------- -------- --------
FINANCING ACTIVITIES
Common shares issued,
net of issue costs 20,326 - 21,793 -
Julietta project loans - 9,300 - 12,900
Refugio loan repayments - (4,000) (500) (4,000)
Deferred financing costs - (233) - (818)
Capital lease repayments - (182) - (406)
Other - 14 - (40)
-------- -------- -------- --------
20,326 4,899 21,293 7,636
-------- -------- -------- --------
INVESTING ACTIVITIES
Refugio Mine - (22) - (34)
Julietta development
and construction - (5,388) (2,435) (9,734)
Julietta Mine (562) - (562) -
Acquisition, exploration
and development (845) (352) (1,314) (602)
Promissory notes issued by
associated companies, net (30) (38) (58) (59)
Purchase of marketable
securities (1,039) - (1,039) -
Proceeds on sale of investments
and marketable securities - 2,266 9 2,266
Proceeds from the sale of
notes receivable - - - 1,000
Other (716) (15) (722) 56
-------- -------- -------- --------
(3,192) (3,549) (6,121) (7,107)
-------- -------- -------- --------
Effect of exchange rate changes
on cash and cash equivalents 207 11 185 1
-------- -------- -------- --------
Increase in cash and
cash equivalents 17,635 935 16,246 2,004
Cash and cash equivalents,
beginning of period 2,744 4,294 4,133 3,225
-------- -------- -------- --------
Cash and cash equivalents,
end of period $ 20,379 $ 5,229 $ 20,379 $ 5,229
-------- -------- -------- --------
-------- -------- -------- --------
BEMA GOLD CORPORATION
OPERATING STATISTICS
For the periods ended June 30
(Unaudited)
Second Quarter Six Months
2002 2001 2002 2001
Julietta Mine (100%)
Gold production (ounces) 28,383 - 51,100 -
Gold sales (ounces) 21,838 - 44,173 -
Operating cash cost ($/oz) 129 - 129 -
Total cash cost ($/oz) 171 - 172 -
Total production cost ($/oz) 275 - 276 -
Refugio Mine (50%)
Gold production (ounces) 1,911 22,726 8,475 48,486
Gold sales (ounces) 2,413 22,771 9,981 48,939
Operating cash cost ($/oz) 272 224 151 227
Total cash cost ($/oz) 279 229 158 233
Total production cost ($/oz) 385 315 248 318
Bema Consolidated
Gold production (ounces) 30,294 22,726 59,575 48,486
Gold sales (ounces) 24,251 22,771 54,154 48,939
Operating cash cost ($/oz) 138 224 132 227
Total cash cost ($/oz) 178 229 170 233
Total production cost ($/oz) 282 315 272 318
Average price received ($/oz) 311 311 307 305
Average spot price ($/oz) 313 267 301 266
>>
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For further information: on Bema Gold please contact Investor Relations
at (604) 681-8371 or toll-free 1-800-316-8855 or alternatively contact our
web-site at www.bema.com;
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newswire.ca and click on reports@cnw.
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