Sales of $39.7 Gross margin Cash flow fro Dividend of $ Ended the qu increase of $5
NEW WS RELEASE Trading Symbol: TSX: SVM NYSE AMERC CIAN: SVM
SILVER RCORP REPOR RTS Q1 RESUL LTS: NET INCO OME UP 134% % TO $10.9 M MILLION, $0 0.07 PER SHA ARE
VANC COUVER, Briti ish Columbia –
- August 3, 20 017 – Silverco orp Metals Inc
c. (“Silvercorp” or the “Com mpany”) (TSX:
: SVM) (NYSE American: SV VM) reported its financial and operating results for the e first quarter r ended June 30, 2017. All amounts are expressed in US Dollars.
FIRST T QUARTER H HIGHLIGHTS
- Net income attributable t per share1, up to equity sha areholders of $10.9 million n, or $0.07 p p 134% compared to net income attributable to equity shareh $0.03 per share in the holders of $4.7 7 million, or $ prior year quarter;
- Sales of $39.7 7 million, up 1 13% compared d to $35.3 mill lion in the prio or year quarte er;
- Gross margin n of 50% comp pared with 45% % in the prior year quarter;
- Cash flow fro om operations of $16.9 million, compared d to $20.2 mill lion in the prio or year quarte er;
- Dividend of $ $1.7 million, or r $0.01 per share, paid to th he equity shar reholders;
- Ended the qu uarter with $1 102.1 million i in cash and ca ash equivalent ts and short‐t term investme ents, an increase of $5 5.6 million or 6% compared d to $96.5 million as at Marc ch 31, 2017;
- Silver, lead, a and zinc meta als sold amounted to appro oximately 1.5 million ounce es silver, 15.9 million inc, down 8%, 5%, and 4% y from the prior year pounds lead, , and 5.0 milli ion pounds zi %, respectively
- Head grades were 304 gra ams per ton (“g/t”) for silve er, 4.6% for le ead, and 0.8% % for zinc at the Ying Mining Distri ict, compared d to 308 g/t f for silver, 4.4% % for lead an nd 1.1% for zinc in the prior year quarter;
- Total and cas ore2 of $68.12 2 and $50.29, respectively, compared to $68.70 sh mining cost ts per tonne o and $47.24 in n the prior yea ar quarter;
- Cash cost pe er ounce of silver2, net of b by‐product cr redits, of nega ative $3.57, c compared to p positive $0.08 in the p prior year quarter;
- All‐in sustaining cost per o ounce of silver2, net of by‐p product credit ts, of $4.70, c compared to $ $7.06 in the prior year quarter; and d,
- Realized a ga ain of $4.3 mil llion on the disposal of the e Company’s 2 2.5% net smelter return (“N NSR”) in the Silvertip m mine.
1 Earn nings per share refers to basic earnings per sh hare 2 Non econciliation n IFRS measure, please refer to
- section 10 of t the correspondi ing MD&A for re
FINANCIALS
Net income attributable to equity shareholders of the Company in Q1 Fiscal 2018 was $10.9 million, or $0.07 per share, compared to $4.7 million, or $0.03 per share in Q1 Fiscal 2017.
The Company’s financial results in Q1 Fiscal 2018 were mainly impacted by the following: i) the increase of metal prices, as the realized selling price for silver, lead, and zinc increased by 5%, 35%, and 65%, compared to the prior year quarter; ii) a $4.3 million gain on disposal of Silvertip Mine’s NSR; offset by i) a $1.6 million foreign exchange loss, ii) less metals sold, and iii) a 3% increase in per tonne cash production costs.
Sales in Q1 Fiscal 2018 were $39.7 million, up 13% compared to $35.3 million in the same quarter last year. Silver and gold sales represented $20.2 million and $1.0 million, respectively, while base metals represented $18.5 million of total sales compared to silver, gold and base metals sales of $20.8 million, $0.9 million, and $13.6 million, respectively, in the prior year quarter.
Cost of sales in Q1 Fiscal 2018 was $19.7 million compared to $19.5 million in Q1 Fiscal 2017. The cost of sales included $14.1 million (Q1 Fiscal 2017 ‐ $14.2 million) production costs, $1.1 million mineral resources tax (Q1 Fiscal 2017 ‐ $0.4 million), and $4.5 million (Q1 Fiscal 2017 ‐ $5.0 million) depreciation and amortization charges. The increase of mineral resources tax was mainly because the mineral resources tax was levied based on a certain percentage of sales in the current quarter while it was levied based on the tonnage of ore milled in the prior year quarter. The decrease of depreciation and amortization charges was mainly due to higher mineral reserves at the Ying Mining District as defined in the NI43‐101 technical report released in February 2017, resulting in lower depreciation and amortization charges per unit of metal production.
Gross profit margin in Q1 Fiscal 2018 improved to 50%, compared to 45% in Q1 Fiscal 2017. The improvement of gross profit margin was mainly due to the increase of metal prices. Ying Mining District’s gross margin was 56% compared to a 49% gross profit margin in the prior year quarter, while GC Mine’s profit margin was 30% compared to a 17% gross profit margin in the prior year.
General and administrative expenses in Q1 Fiscal 2018 were $4.6 million, an increase of 4% or $0.2 million, compared to $4.4 million in Q1 Fiscal 2017.
Gain on disposal of mineral rights and properties in Q1 Fiscal 2018 was $4.3 million compared to $nil in the prior year quarter, as the Company’s 2.5% NSR in the Silvertip mine was disposed in the current
Income tax expenses in Q1 Fiscal 2018 were $4.0 million compared to $2.8 million in Q1 Fiscal 2017. The income tax expenses recorded in Q1 Fiscal 2018 included current income tax expenses of $3.2 million (Q1 Fiscal 2017 – $0.7 million) and deferred income taxes expenses of $0.8 million (Q1 Fiscal 2017 – $2.1 million).
Cash flows provided by operating activities in Q1 Fiscal 2018 were $16.9 million, a decrease of $3.2 million or 16%, compared to $20.2 million in the prior year quarter. Before changes in non‐cash operating working capital, cash flows provided by operating activities in Q1 Fiscal 2018 were $14.8 million, a decrease of $0.7 million or 5%, compared to $15.5 million in the prior year quarter. The decrease in cash flow provided by operating activities is mainly due to $4.1 million income tax paid in the current quarter while net tax refunds of $0.1 million were received in the prior year quarter.
The Company also paid dividend of $1.7 million, or $0.01 per share to the equity shareholders, and ended the quarter with $102.1 million in cash and short‐term investments, an increase of $5.6 million or 6%, compared to $96.5 million as at March 31, 2017.
Working capital as at June 30, 2017 was $80.7 million, an increase of $10.0 million or 14%, compared to $70.7 million working capital as at March 31, 2017.
OPERATIONS AND DEVELOPMENT
In Q1 Fiscal 2018, the Company sold 1.5 million ounces of silver, 900 ounces of gold, 15.9 million pounds of lead, and 5.0 million pounds of zinc, compared to 1.6 million ounces of silver, 900 ounces of gold, 16.7 million pounds of lead, and 5.2 million pounds of zinc, respectively, in Q1 Fiscal 2017. The decrease of metals sold was mainly due to not all metals produced in the quarter being sold in the same quarter as the Company intentionally increased its concentrate inventory at the Ying Mining District. As at June 30, 2017, lead concentrate inventory at the Ying Mining District was 4,050 tonnes, an increase of 1,757 tonnes, compared to 2,293 tonnes of lead concentrate inventory as at March 31, 2017.
In Q1 Fiscal 2018, the consolidated total mining costs and cash mining costs were $68.12 and $50.29 per tonne, compared to $68.70 and $47.24 per tonne, respectively, in Q1 Fiscal 2017. The increase in cash mining costs were mainly due to a $0.7 million increase in mining preparation costs resulting from more underground drilling and tunnelling expensed in the current quarter.
The consolidated total production costs and cash costs per ounce of silver, net of by‐product credits, were negative $0.62 and negative $3.57 in Q1 Fiscal 2018 compared to $3.11 and $0.08 respectively, in the prior year quarter. The overall decrease in cash cost per ounce of silver, net of by‐product credits, is mainly due to a 35% increase in by‐product credits, mainly arising from 35% and 65% increase in lead and zinc net realized selling prices. Sales from lead and zinc accounted for 46% of the total sales and amounted to $18.1 million, an increase of $4.7 million, compared to $13.5 million in the prior year quarter.
In Q1 Fiscal 2018, the consolidated all‐in sustaining cost per ounce of silver, net of by‐product credits, is $4.70 compared to $7.06 in Q1 Fiscal 2017, and the decrease is mainly due to the 35% increase in by‐ product credits.
1. Ying Mining District, Henan Province, China
| Operational results ‐ Ying Mining District Q1 2018 Q4 2017 Q3 2017 Q2 2017 Q1 2017 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016 June 30, 2016 | ||
|---|---|---|
| Ore Mined (tonne) Ore Milled (tonne) | 160,408 | 112,755 171,303 179,194 173,508 108,051 182,259 180,154 167,747 |
| 164,959 | ||
| Head Grades Silver (gram/tonne) Lead (%) Zinc (%) | 298 303 302 308 4.8 4.8 4.9 4.4 0.8 0.8 1.1 1.1 | |
| 304 | ||
| 4.6 | ||
| 0.8 | ||
| Recoveries Silver (%) Lead (%) Zinc (%) | 96.6 95.1 95.5 95.7 95.6 96.7 96.3 96.4 46.2 47.5 42.9 48.4 | |
| 95.8 | ||
| 96.3 | ||
| 45.8 | ||
| Metal Sales Silver (in thousands of ounce) Gold (in thousands of ounce) Lead (in thousands of pound) Zinc (in thousands of pound) | 1,255 1,555 1,630 1,490 0.7 0.7 1.0 0.9 13,520 17,269 17,768 14,861 1,033 1,210 1,785 1,820 | |
| 1,324 | ||
| 0.9 | ||
| 13,765 | ||
| 755 | ||
| Cash mining costs ($ per tonne) Total mining costs ($ per tonne) Cash milling costs ($ per tonne) Total milling costs ($ per tonne) | 54.78 | 49.99 55.21 49.13 52.33 53.50 80.53 76.30 78.64 10.43 9.09 8.85 10.07 13.60 11.03 10.86 12.25 |
| 76.67 | ||
| 8.07 | ||
| 10.10 | ||
| Cash production costs ($ per tonne) Cash costs per ounce of silver ($) All‐in sustaining costs per ounce of silver ($) | 66.93 | 64.34 68.22 61.79 66.27 (3.73) (4.60) (2.68) 0.12 0.74 1.34 2.33 5.80 |
| (2.97) 3.66 |
- Figures may not add due to rounding
In Q1 Fiscal 2018, the total ore mined at the Ying Mining District was 160,408 tonnes, a decrease of 8%, compared to 173,508 tonnes mined in the prior year quarter. The decrease was mainly due to additional downtime arising from several power down days due to power grid upgrade by State Grid Corporation of China impacting the TLP, LMW and LME mines and hoist maintenance and cable steel replacement at the SGX and HZG mines. Correspondingly, ore milled decreased by 2% to 164,959 tonnes from 167,747 tonnes in the prior year quarter. Head grades were 304 grams per ton (“g/t”) for silver, 4.6% for lead, and 0.8% for zinc, compared to 308 g/t for silver, 4.4% for lead and 1.1% for zinc in the prior year quarter.
In Q1 Fiscal 2018, the Ying Mining District sold approximately 1.3 million ounces silver, 13.8 million pounds lead, and 0.7 million pounds zinc, compared to 1.5 million ounces silver, 14.9 million pounds lead, and 1.8 million pounds of zinc in the prior year quarter. The decrease of metals sold at the Ying Mining District was mainly due to: i) a 2% decrease of ore milled; and ii) not all metals produced were sold in the same quarter as the Company intentionally increased its concentrate inventory at the Ying Mining District. As at June 30, 2017, Ying Mining District had 4,050 tonnes of lead concentrate inventory and 980 tonnes of zinc concentrate inventory, an increase of 1,759 and 500 tonnes, respectively, compared to 2,293 tonnes of lead concentrate and 480 tonnes of zinc concentrate held as at March 31, 2017.
Total and cash mining costs per tonne at the Ying Mining District in Q1 Fiscal 2018 were $76.67 and $54.78 per tonne, respectively, compared to $78.64 and $52.33 per tonne in the prior year. The increase in cash mining costs was mainly due to a $0.3 million increase in mining preparation costs resulting from more underground drilling and tunnelling expensed in the current quarter. Total and cash milling costs per tonne at the Ying Mining District in Q1 Fiscal 2018 were $10.10 and $8.07, a decrease of 18% and 20%, respectively, compared to $12.25 and $10.07 in Q1 Fiscal 2017. The decrease in cash milling costs was mainly due to the exclusion of mineral resources tax from milling costs.
Correspondingly, cash production cost per tonne of ore processed in Q1 Fiscal 2018 at the Ying Mining District was $66.93, an 1% increase compared to $66.27 in the prior year due to the increase in per tonne cash mining offset by the decrease in per tonne milling costs as discussed above.
Cash cost per ounce of silver, net of by‐product credits, in Q1 Fiscal 2018 at the Ying Mining District, was negative $2.97 compared to $0.12 in the prior year quarter. The improvement was mainly due to a $2.2 million or 20% increase in by‐product credits offset by the 1% increase in the per tonne cash production costs as discussed above.
All in sustaining costs per ounce of silver, net of by‐product credits, in Q1 Fiscal 2018 at the Ying Mining District was $3.66 compared to $5.80 in the prior year quarter. The improvement was mainly due to lower cash cost per ounce of silver as discussed above.
In Q1 Fiscal 2018, approximately 31,064 m or $0.7 million of underground diamond drilling (Fiscal Q1 2017 – 16,498 m or $0.4 million) and 5,337 m or $1.4 million of preparation tunnelling (Fiscal Q1 2017 – 4,836 m or $1.4 million) were completed and expensed as mining preparation costs at the Ying Mining District. In addition, approximately 18,890 m or $5.2 million of horizontal tunnel, raises and declines (Q1 Fiscal 2017 – 16,685 m or $4.9 million) were completed and capitalized.
2. GC Mine, Guangdong Province, China
| Operational results ‐ GC Mine | Q1 2018 Q4 2017 Q3 2017 Q2 2017 Q1 2017 June 30, 2017 March 31, 2017 December 31, 2016 September 30, 2016 June 30, 2016 | |
|---|---|---|
| Ore Mined (tonne) Ore Milled (tonne) | 64,865 | 40,224 81,481 74,692 64,349 39,929 81,080 76,100 63,587 |
| 65,944 | ||
| Head Grades Silver (gram/tonne) Lead (%) Zinc (%) | 91 89 96 99 1.3 1.4 1.6 1.5 2.6 2.8 2.8 2.9 | |
| 98 | ||
| 1.6 | ||
| 2.7 | ||
| Recovery Rates Silver (%) Lead (%) Zinc (%) | 72.8 75.4 76.2 76.8 82.4 85.5 86.6 86.9 74.8 86.5 86.4 85.8 | |
| 81.2 | ||
| 88.8 | ||
| 80.9 | ||
| Metal Sales Silver (in thousands of ounce) Lead (in thousands of pound) Zinc (in thousands of pound) | 53 179 183 149 818 2,214 2,163 1,860 455 4,478 4,106 3,407 | |
| 189 | ||
| 2,147 | ||
| 4,244 | ||
| Cash mining costs ($ per tonne) Total mining costs ($ per tonne) Cash milling costs ($ per tonne) Total milling costs ($ per tonne) | 39.20 | 37.91 31.34 28.61 33.50 45.37 38.90 36.78 41.91 20.06 13.09 12.94 15.60 24.99 15.50 15.57 18.81 |
| 46.99 | ||
| 16.73 | ||
| 19.85 | ||
| Cash production costs ($ per tonne) Cash costs per ounce of silver ($) All‐in sustaining costs per ounce of silver ($) | 55.93 | 57.97 44.43 41.55 49.10 (1.72) (13.11) (6.39) (0.28) 14.55 (6.12) (1.49) 4.76 |
| (7.80) | ||
| (2.48) |
In Q1 Fiscal 2018, the total ore mined at the GC Mine was 64,865 tonnes, comparable to 64,349 tonnes of mined in Q1 Fiscal 2017. Ore milled increased by 4% to 65,944 tonnes from 63,587 tonnes in the prior year quarter. Head grades were 98 g/t for silver, 1.6% for lead, and 2.7% for zinc compared to 99 g/t for silver, 1.5% for lead, and 2.9% for zinc in the prior year quarter.
In Q1 Fiscal 2018, GC Mine sold 189 thousand ounces of silver, 2.1 million pounds of lead, 4.2 million pounds of zinc compared to 149 thousand ounces of silver, 1.9 million pounds of lead, and 3.4 million pounds of zinc sold in the prior year.
Total and cash mining costs per tonne at the GC Mine in Q1 Fiscal 2018 were $46.99 and $39.20 per tonne, compared to $41.91 and $33.50 per tonne in Q1 Fiscal 2017. The increase in cash mining costs was mainly due to a 31% or $0.4 million increase in mining preparation costs resulting from more underground drilling and tunnelling expensed in the current quarter.
Total and cash milling costs per tonne at the GC Mine in Q1 Fiscal 2018 were $19.85 and $16.73, compared to $18.81 and $15.60, respectively, in Q1 Fiscal 2017. The slight increase in milling costs was mainly due to additional efforts in improving the milling recovery rates resulting in additional labor costs and material consumption.
The cash production costs per tonne of ore processed in Q1 Fiscal 2018 at the GC Mine increased to $55.93 from $49.10 in the prior year quarter.
Cash costs per ounce of silver, net of by‐product credits, at the GC Mine, was negative $7.80 compared to negative $0.28 in the prior year quarter. The decrease was mainly due to $2.8 million or 91% increase in by‐product credits as a 40% and 66% increase in net realized lead and zinc selling prices and more lead and zinc metals sold at the GC Mine.
All in sustaining costs per ounce of silver, net of by‐product credits, in Q1 Fiscal 2018 at the GC Mine was negative $2.48 compared to $4.76 in the prior year quarter as a 40% and 66% increase in net realized lead and zinc selling prices and more lead and zinc metals sold.
In Q1 Fiscal 2018, approximately 4,972 m or $0.3 million of underground diamond drilling (Q1 Fiscal 2017
- 3,309 m or $0.2 million) and 5,292 m or $1.3 million of tunnelling (Q1 Fiscal 2017 – 3,486 m or $1.0
million) were completed and expensed as mining preparation costs at the GC Mine. In addition, approximately 158 m or $0.1 million of horizontal tunnel, raises and declines (Q1 Fiscal 2017 – 582 m or $0.2 million) were completed and capitalized.
Alex Zhang, P.Geo., Vice President, Exploration, is the Qualified Person for Silvercorp under NI 43‐101 and has reviewed and given consent to the technical information contained in this news release.
| This earnings release should be read in conjunction with the Company's Management Discussion & | |||
|---|---|---|---|
| Analysis, Financial Statements and Notes to Financial Statements for the corresponding period, which have | |||
| been posted on SEDAR at | and are also available on the Company's website | ||
| at | www.silvercorp.ca | . |
About Silvercorp
Silvercorp is a low‐cost silver‐producing Canadian mining company with multiple mines in China. The Company's vision is to deliver shareholder value by focusing on the acquisition of under developed projects with resource potential and the ability to grow organically. For more information, please visit our website at www.silvercorp.ca.
For further information
Silvercorp Metals Inc.
Gordon Neal Vice President, Corporate Development Phone: (604) 669‐9397 Toll Free 1(888) 224‐1881 Email: [email protected] Website: www.silvercorp.ca
CAUTIONARY DISCLAIMER ‐ FORWARD LOOKING STATEMENTS
Certain of the statements and information in this press release constitute “forward‐looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and “forward‐looking information” within the meaning of applicable Canadian provincial securities laws. Any statements or information that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “expects”, “is expected”, “anticipates”, “believes”, “plans”, “projects”, “estimates”, “assumes”, “intends”, “strategies”, “targets”, “goals”, “forecasts”, “objectives”, “budgets”, “schedules”, “potential” or variations thereof or stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward‐looking statements or information. Forward‐looking statements or information relate to, among other things: the price of silver and other metals; the accuracy of mineral resource and mineral reserve estimates at the Company’s material properties; the sufficiency of the Company’s capital to finance the Company’s operations; estimates of the Company’s revenues and capital expenditures; estimated production from the Company’s mines in the Ying Mining District; timing of receipt of permits and regulatory approvals; availability of funds from production to finance the Company’s operations; and access to and availability of funding for future construction, use of proceeds from any financing and development of the Company’s properties.
Forward‐looking statements or information are subject to a variety of known and unknown risks, uncertainties and other factors that could cause actual events or results to differ from those reflected in the forward‐looking statements or information, including, without limitation, risks relating to: fluctuating commodity prices; calculation of resources, reserves and mineralization and precious and base metal recovery; interpretations and assumptions of mineral resource and mineral reserve estimates; exploration and development programs; feasibility and engineering reports; permits and licences; title to properties; property interests; joint venture partners; acquisition of commercially mineable mineral rights; financing; recent market events and conditions; economic factors affecting the Company; timing, estimated amount, capital and operating expenditures and economic returns of future production; integration of future acquisitions into the Company’s existing operations; competition; operations and political conditions; regulatory environment in China and Canada; environmental risks; foreign exchange rate fluctuations; insurance; risks and hazards of mining operations; key personnel; conflicts of interest; dependence on management; internal control over financial reporting as per the requirements of the Sarbanes‐Oxley Act; and bringing actions and enforcing judgments under U.S. securities laws.
This list is not exhaustive of the factors that may affect any of the Company’s forward‐looking statements or information. Forward‐looking statements or information are statements about the future and are inherently uncertain, and actual achievements of the Company or other future events or conditions may differ materially from those reflected in the forward‐looking statements or information due to a variety of risks, uncertainties and other factors, including, without limitation, those referred to in the Company’s Annual Information Form for the year ended March 31, 2017 under the heading “Risk Factors”. Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated, described or intended. Accordingly, readers should not place undue reliance on forward‐ looking statements or information.
The Company’s forward‐looking statements and information are based on the assumptions, beliefs, expectations and opinions of management as of the date of this press release, and other than as required by applicable securities laws, the Company does not assume any obligation to update forward‐looking statements and information if circumstances or management’s assumptions, beliefs, expectations or opinions should change, or changes in any other events affecting such statements or information. For the reasons set forth above, investors should not place undue reliance on forward‐looking statements and information.
Consolidated Statements of Financial Position
As at June 30, As at March 31, 2017 2017
ASSETS Current Assets
Cash and cash equivalents $ 74,300 $ 73,003
| Short‐term investments | 27,751 | 23,466 |
| Trade and other receivables | 1,270 | 1,311 |
| Inventories | 9,344 | 8,710 |
| Due from related parties | 37 | 92 |
| Prepaids and deposits | 4,226 | 4,250 |
116,928 110,832
Non‐current Assets
| Long‐term prepaids and deposits | 868 | 959 |
| Reclamation deposits | 5,139 | 5,054 |
| Investment in an associate | 8,486 | 8,517 |
| Other investments | 5,520 | 1,207 |
| Plant and equipment | 65,536 | 65,201 |
| Mineral rights and properties | 211,418 | 206,200 |
TOTAL ASSETS $
413,895 $ 397,970
LIABILITIES AND EQUITY Current Liabilities
Accounts payable and accrued liabilities $ 26,383 $ 30,374 Deposits received 7,754 6,798 Income tax payable 2,138 2,985 36,275 40,157
Non‐current Liabilities
| Deferred income tax liabilities | 28,938 | 27,692 |
| Environmental rehabilitation | 12,486 | 12,186 |
| Total Liabilities | 77,699 | 80,035 |
Equity
| Share capital | 232,159 | 232,155 |
| Share option reserve | 13,727 | 13,325 |
| Reserves | 25,409 | 25,409 |
| Accumulated other comprehensive loss | (45,222) | (50,419) |
| Retained earnings | 51,909 | 42,651 |
| Total equity attributable to the equity holders of the Company | 277,982 | 263,121 |
| Non‐controlling interests | 58,214 | 54,814 |
| Total Equity | 336,196 | 317,935 |
TOTAL LIABILITIES AND EQUITY $
413,895 $ 397,970
Consolidated Statements of Income
(Unaudited ‐ Expressed in thousands of U.S. dollars, except for per share figures)
Sales $ 39,697 $ 35,271
Cost of sales
| Production costs | 14,109 | 14,153 |
| Mineral resource taxes | 1,111 | 411 |
| Depreciation and amortization | 4,472 | 4,963 |
19,692 19,527
| Gross profit | 20,005 | 15,744 |
| General and administrative | 4,570 | 4,385 |
| Government fees and other taxes | 841 | 1,695 |
| Foreign exchange loss | 1,615 | 123 |
| Loss on disposal of plant and equipment | 170 | 264 |
| Gain on disposal of NSR | (4,320) | ‐ |
| Share of loss (income) in associate | 244 | (17) |
| Impairment of plant and equipment and mineral rights and properties | ‐ | 181 |
| Other income | (181) | (40) |
| Income from operations | 17,066 | 9,153 |
| Finance income | 574 | 431 |
| Finance costs | (105) | (264) |
| Income before income taxes | 17,535 | 9,320 |
| Income tax expense | 4,021 | 2,800 |
Net income $ 13,514 $ 6,520
Attributable to:
Equity holders of the Company $ 10,937 $ 4,674 Non‐controlling interests 2,577 1,846 $ 13,514 $ 6,520
Earnings per share attributable to the equity holders of the Company
Basic earnings per share $ 0.07 $ 0.03 Diluted earnings per share $ 0.06 $ 0.03 Weighted Average Number of Shares Outstanding ‐ Basic 167,890,187 166,939,465 Weighted Average Number of Shares Outstanding ‐ Diluted 169,784,602 169,819,527
Consolidated Statements of Cash Flow
Cash provided by Operating activities
Net income $ 13,514 $ 6,520 Add (deduct) items not affecting cash:
| Finance costs | 105 | 105 |
| Depreciation, amortization and depletion | 4,752 | 5,320 |
| Share of loss (income) in associate | 244 | (17) |
| Gain on disposal of NSR | (4,320) | ‐ |
| Impairment of plant and equipment and mineral rights and properties | ‐ | 181 |
| Income tax expense | 4,021 | 2,800 |
| Finance income | (574) | (431) |
| Loss on disposal of plant and equipment | 170 | 264 |
| Share‐based compensation | 403 | 243 |
| Income taxes (paid) recovered | (4,137) | 91 |
| Interest received | 574 | 431 |
| Interest paid | ‐ | (51) |
| Changes in non‐cash operating working capital | 2,144 | 4,726 |
| Net cash provided by operating activities | 16,896 | 20,182 |
Investing activities
Mineral rights and properties Capital expenditures (5,911) (5,020) Plant and equipment
| Additions | (1,211) | (2,384) | |
| Proceeds on disposals | ‐ | 17 | |
| Reclamation deposit paid | (4) | (385) | |
| Net purchases of short‐term investments | (3,704) | (3,981) | |
| Net cash used in investing activities | (10,830) | (11,753) |
Financing activities
Non‐controlling interests
| Distribution | (4,891) | ‐ |
| Cash dividends distributed | (1,679) | ‐ |
| Proceeds from issuance of common shares | 3 | 215 |
| Net cash used in financing activities | (6,567) | 215 |
| Effect of exchange rate changes on cash and cash equivalents | 1,798 | (1,005) |
| Increase (decrease) in cash and cash equivalents | 1,297 | 7,639 |
| Cash and cash equivalents, beginning of the year | 73,003 | 41,963 |
Cash and cash equivalents, end of the year $ 74,300 $ 49,602
| Three months ended June 30, 2017 | ||
| Ying Mining District1 | GC2 | Consolidated |
| Ore Mined (tonne) | 160,408 | 64,865 | 225,273 |
| Ore Milled (tonne) | 164,959 | 65,944 | 230,903 |
| + Mining cost per tonne of ore mined ($) | 76.67 | 46.99 | 68.12 |
| Cash mining cost per tonne of ore mined ($) | 54.78 | 39.20 | 50.29 |
| Non cash mining cost per tonne of ore mined ($) | 21.89 | 7.79 | 17.83 |
| + Unit shipping costs($) | 4.08 | ‐ | 2.87 |
| + Milling costs per tonne of ore milled ($) | 10.10 | 19.85 | 12.88 |
| Cash milling costs per tonne of ore milled ($) | 8.07 | 16.73 | 10.54 |
| Non cash milling costs per tonne of ore milled ($) | 2.03 | 3.12 | 2.34 |
| Silver ($ per ounce) | 5.74 | 7.03 | 6.24 |
| Gold ($ per ounce) | 445 | ‐ | 499 |
| Lead ($ per pound) | 0.35 | 0.56 | 0.40 |
| Zinc ($ per pound) | 0.41 | 0.62 | 0.44 |
| Other ($ per pound) | 0.34 | 0.02 | 0.02 |
| + Total production costs per ounce of Silver, net of by‐product credits ($) | (0.23) | (3.33) | (0.62) |
| + Total cash costs per ounce of Silver, net of by‐product credits ($) | (2.97) | (7.80) | (3.57) |
| + All‐in sustaining costs per ounce of Silver, net of by‐product credits ($) | 3.66 | (2.48) | 4.70 |
| + All‐in costs per ounce of Silver, net of by‐product credits ($) | 3.96 | 0.51 | 5.33 |
| Silver (%) | 95.8 | 81.2 | 94.1 |
| Lead (%) | 96.3 | 88.8 | 95.4 |
| Zinc (%) | 45.8 | 80.9 | 66.2 |
Head Grades
| Silver (gram/tonne) | 304 | 98 | 245 |
| Lead (%) | 4.6 | 1.6 | 3.7 |
| Zinc (%) | 0.8 | 2.7 | 1.3 |
Lead concentrate (tonne) 4,050 61 4,111 Zinc concentate (tonne) 980 237 1,217
Sales Data Metal Sales
| Silver (in thousands of ounces) | 1,324 | 189 | 1,513 |
| Gold (in thousands of ounces) | 0.9 | ‐ | 0.9 |
| Lead (in thousands of pounds) | 13,765 | 2,147 | 15,912 |
| Zinc (in thousands of pounds) | 755 | 4,244 | 4,999 |
| Other (in thousands of pounds) | 254 | 7,902 | 8,156 |
Metal Sales
| Silver (in thousands of $) | 18,204 | 1,979 | 20,183 |
| Gold (in thousands of $) | 959 | ‐ | 959 |
| Lead (in thousands of $) | 11,647 | 1,801 | 13,448 |
| Zinc (in thousands of $) | 739 | 3,942 | 4,681 |
| Other (in thousands of $) | 208 | 218 | 426 |
| 31,757 | 7,940 | 39,697 |
Average Selling Price, Net of Value Added Tax and Smelter Charges
| Silver ($ per ounce) | 13.75 | 10.47 | 13.34 |
| Gold ($ per ounce) | 1,066 | ‐ | 1,066 |
| Lead ($ per pound) | 0.85 | 0.84 | 0.85 |
| Zinc ($ per pound) | 0.98 | 0.93 | 0.94 |
1 Ying Mining District includes mines: SGX, TLP, HPG,LM, BCG and HZG.
2 GC Silver recovery rate consists of 60.5% from lead concentrates and 20.8% from zinc concentrates.
2 GC Silver sold in zinc concentrates is subjected to higher smelter and refining charges which lowers the net silver selling price.
| Three months ended June 30, 2016 | ||
| Ying Mining District1 | GC2 | Consolidated |
| Ore Mined(tonne) | 173,508 | 64,349 | 237,857 |
| Ore Milled(tonne) | 167,747 | 63,587 | 231,334 |
| + Mining costs per tonne of ore mined($) | 78.64 | 41.91 | 68.70 |
| Cash mining costs per tonne of ore mined($) | 52.33 | 33.50 | 47.24 |
| Non cash mining costs per tonne of ore mined($) | 26.30 | 8.41 | 21.46 |
| + Unit shipping costs($) | 3.87 | ‐ | 2.82 |
| + Milling costs per tonne of ore milled($) | 12.25 | 18.81 | 14.05 |
| Cash milling costs per tonne of ore milled($) | 10.07 | 15.60 | 11.59 |
| Non cash milling costs per tonne of ore milled($) | 2.18 | 3.21 | 2.46 |
| Silver($ per ounce) | 6.66 | 8.19 | 7.04 |
| Gold($ per ounce) | 496 | ‐ | 536 |
| Lead($ per pound) | 0.32 | 0.50 | 0.35 |
| Zinc($ per pound) | 0.30 | 0.46 | 0.31 |
| Other($ per pound) | ‐ | 0.01 | 0.01 |
| + Total production costs per ounce of Silver, net of by‐product credits ($) | 2.96 | 4.60 | 3.11 |
| + Total cash costs per ounce of Silver, net of by‐product credits ($) | 0.12 | (0.28) | 0.08 |
| + All‐in sustaining costs per ounce of Silver, net of by‐product credits ($) | 5.80 | 4.76 | 7.06 |
| + All‐in costs per ounce of Silver, net of by‐product credits ($) | 7.34 | 5.10 | 8.48 |
| Silver (%) | 95.7 | 76.8 | 93.6 |
| Lead(%) | 96.4 | 86.9 | 95.3 |
| Zinc (%) | 48.4 | 85.8 | 67.5 |
Head Grades
| Silver (gram/tonne) | 308 | 99 | 251 |
| Lead(%) | 4.4 | 1.5 | 3.6 |
| Zinc(%) | 1.1 | 2.9 | 1.6 |
Lead concentrate (tonne) 3,669 55 3,724 Zinc concentate (tonne) 280 133 413
Sales Data Metal Sales
| Silver(in thousands of ounces) | 1,490 | 149 | 1,639 |
| Gold(in thousands of ounces) | 0.9 | ‐ | 0.9 |
| Lead (in thousands of pounds) | 14,861 | 1,860 | 16,721 |
| Zinc(in thousands of pounds) | 1,820 | 3,407 | 5,227 |
| Other(in thousands of pounds) | ‐ | 8,186 | 8,186 |
Metal Sales
| Silver(in thousands of $) | 19,366 | 1,471 | 20,837 |
| Gold(in thousands of $) | 872 | ‐ | 872 |
| Lead(in thousands of $) | 9,381 | 1,112 | 10,493 |
| Zinc (in thousands of $) | 1,053 | 1,906 | 2,959 |
| Other(in thousands of $) | ‐ | 110 | 110 |
| 30,672 | 4,599 | 35,271 |
Average Selling Price, Net of Value Added Tax and Smelter Charges
| Silver($ per ounce) | 13.00 | 9.87 | 12.71 |
| Gold($ per ounce) | 969 | ‐ | 969 |
| Lead($ per pound) | 0.63 | 0.60 | 0.63 |
| Zinc($ per pound) | 0.58 | 0.56 | 0.57 |
1 Ying Mining District includes mines: SGX, TLP, HPG,LM, BCG and HZG.
2 GC Silver recovery rate consists of 55.7% from lead concentrates and 21.1% from zinc concentrates.
2 GC Silver sold in zinc concentrates is subjected to higher smelter and refining charges which lower the net silver selling price.