Avino Reports Q4 and Year End 2019 Financial Results
ASM: TSX/NYSE American
Avino Silver & Gold Mines Ltd. T (604) 682 3701
Suite 900-570 Granville Street F (604) 682 3600
Vancouver, BC V6C 3P1 www.avino.com
February 26, 2020
Avino Reports Q4 and Year End 2019 Financial Results
Avino Silver & Gold Mines Ltd. (ASM: TSX/NYSE American; FSE: GV6, "Avino" or "the Company") released today its consolidated
financial results for the Company’s fourth quarter and year ended December 31, 2019 . The Financial Statements and Management
Discussion and Analysis (MD&A) can be viewed on the Company’s web site at www.avino.com, on SEDAR at www.sedar.com and on
EDGAR at www.sec.gov.
David Wolfin, President and CEO commented, “We can describe 2019 as a transitional year for Avino. The transition began with the
winding down and ultimately the stoppage of mining at San Gonzalo during the fourth quarter of 2019. The San Gonzalo mine, which
began commercial production in 2012, outperformed its 5 -year mine life by exceeding that timeline by two years and produced 6
million silver equivalent ounces at an average cash cost under $10 per silver equivalent ounce. Without the benefit of San Gonzalo’s
historically higher grade, our consolidated cash costs and all in sustaining costs have gone up in 2019. Additionally, we experienced
some operational challenges where we faced a few lost days of production during upgrades to the crusher, labour negotiations due
to the transition of contractors at San Gonzalo, as well as heavy seasonal rain, which i s reflected in our financial and operational
results. Finally, the last significant transition can be attributed to the sale of Bralorne to Talisker Resources, which has shifted our
focus to a silver focused company in Mexico. Our investment is up signific antly since the close of the sale, and end of the year, and
we continue to wish them much success at Bralorne. Despite the challenges, ultimately, we feel that the year has been positive in its
outcome, with operating cash flow s of $1.4 million, positive E BITDA, a renewed focus on Mexico and our Elena Tolosa Mine , and
cash in the bank that will help fund our search for another exciting high grade deposit similar to San Gonzalo , within the Avino
property.”
Financial Highlights and Overview
FOURTH QUARTER 2019 FINANCIAL HIGHLIGHTS
• Revenues from mining operations of $10.4 million
• Mine operating loss of $0.4 million
• Net loss from continuing operations of $0.1 million, or $Nil per share
• Net loss including discontinued operations of $29 million
• Operating cash flows before changes in working capital of $1.1 million
• Earnings before interest, taxes, depreciation and amortization (“EBITDA”) 2 of $1.3 million
• Adjusted EBITDA2 of $1.6 million
• Consolidated cash costs2 of $13.14 per silver equivalent payable ounce1
• Consolidated all-in sustaining cash cost (“AISC”)2 of $18.27 per silver payable equivalent ounce 1
• Working capital of $13.2 million at the end of Q4 2019, up 31% from $10.3 million at the end of Q3 2019
• Cash on hand of $9.6 million at the end of Q4 2019, up 234% from $2.9 million at the end of Q3 2019
FULL YEAR 2019 FINANCIAL HIGHLIGHTS
• Revenues from mining operations of $31.7 million
• Mine operating loss of $0.3 million
• Net loss from continuing operations of $2.3 million, or $0.03 per share
• Net loss from operations of $31 million, or a loss of $0.04 per share
• Operating cash flows before changes in working capital of $1.3 million
• EBITDA2 of $0.5 million
• Adjusted EBITDA2 of $1.9 million
• Consolidated cash costs2 of $12.08 per silver equivalent payable ounce1
• AISC2 of $17.19 per silver payable equivalent ounce1
• Working capital of $13.2 million at the end of 2019, up 1% from $13.1 million at the end of 2018
• Cash on hand of $9.6 million at the end of 2019, up 196% from $3.3 million at the end of 2018
N E W S R E L E A S E
Avino Silver & Gold Mines Ltd. – February 26, 2020
Avino Reports Q4 and Year End 2019 Financial Results
Page 2
1. In 2019, AgEq was calculated using metals prices of $16.20 oz Ag, $1,393 oz Au and $2.72 lb Cu. In 2018, AgEq was calculat ed using metals prices of$15.71 oz Ag,
$1,270 oz Au and $2.96 lb Cu
2. In Q4 2019, AgEq was calculated using metals prices of $17.32 oz Ag, $1,482 oz Au and $2.67 lb Cu. In Q4 2018, AgEq was calculated using metals prices of $14.55 oz
Ag, $1,229 oz Au and $2.80 lb Cu.
3. “Silver equivalent payable ounces sold” for the purposes of cash costs and all-in sustaining costs consists of the sum of payable silver ounces, gold ounces and copper
tonnes sold, multiplied by the ratio of the average spot gold and copper prices to the average spot silver price for the corresponding period.
4. The Company reports non-IFRS measures which include cash cost per silver equivalent payable ounce, all-in sustaining cash cost per payable ounce, EBITDA, adjusted
EBITDA, and cash flow per share. These measures are widely used in the mining industry as a benchmark for performance, but do not have a standardized meaning and
the calculation methods may differ from methods used by other companies with similar reported measures. See Non-IFRS Measures section for further information and
detailed reconciliations.
HIGHLIGHTS
(Expressed in 000’s of US$)
Fourth Quarter
2019
Fourth Quarter
2018
Change
Year
2019
Year
2018
Change
Financial
Revenues $ 10,427 $ 8,268 26% $ 31,746 $ 34,116 -7%
Mine Operating Income (loss) $ (445) $ 1,347 -133% $ (270) $ 6,266 -104%
Net Income (loss) from continuing operations $ (126) $ 801 -116% $ (2,335) $ 1,657 -241%
Net Income (loss) from operations $ (29,043) $ 981 -% $ (31,461) $ 1,626 -%
Cash $ 9,625 $ 3,252 196% $ 9,625 $ 3,252 196%
Working Capital $ 13,209 $ 13,106 1% $ 13,209 $ 13,106 1%
Earnings before interest, taxes and amortization
(“EBITDA”)1 $ 1,342 $ 1,018 32% $ 462 $ 5,749 -92%
Adjusted EBITDA1 $ 1,568 $ 1,466 7% $ 1,929 $ 5,876 -67%
Per Share Amounts
Earnings (loss) per share ("EPS") – basic $ - $ 0.02 -100% $ (0.03) $ 0.03 -200%
Cash flow per share (YTD)1 – basic $ 0.01 $ 0.03 -67% $ 0.02 $ 0.07 -71%
1. The Company reports non-IFRS measures which include cash cost per silver equivalent payable ounce, all-in sustaining cash cost per payable ounce, EBITDA, adjusted
EBITDA, and cash flow per share. These measures are widely used in the mining industry as a benchmark for performance, but do not have a standardized meaning and
the calculation methods may differ from methods used by other companies with similar reported measures. See Non-IFRS Measures section for further information and
detailed reconciliations.
Costs and Capital Expenditures:
On a consolidated basis, the Company reduced its G&A expenditures by $0.4 million, or 13% for the full year 2019 compared to 2018.
Capital expenditures company-wide for the full year 2019, were $8.9 million compared to $14.8 million for 2018. Included in the $8.9
million were $5.7 million in capital and drilling expenditures at Bralorne up to the closing date of December 13, 2019.
Capital expenditures at the Avino property mainly relate to the membrane for Open -Pit area for holding tailings, new mining,
milling/processing, and transportation equipment for the Company’s San Gonzalo and Avino mines, and minor updates to the Tailings
Thickener.
Bralorne Mine
In Q4 2019, the Company completed the sale of Bralorne Gold Mines to Talisker Resources Ltd., with the Company receiving:
• Cash consideration of C$8.7 million;
• The issuance of 12.58 million common shares, comprising 9.9% of the issued and outstanding common shares of Talisker after
the close of the transaction
• The issuance of 6.29 million share purchase warrants exercisable at C$0.25 per share until December 13, 2022, provided that
if at any time following April 14, 2020 the closing price of Talisker’s common shares exceeds C$0.35 per share for 20 or more
consecutive trading days, then Talisker may accelerate the expiry date of the warrants upon 30 days’ notice to the Company;
• A cash payment of $2.5 million, contingent of the commencement of commercial production at the Bralorne mine; and
• The transfer of all future restoration and reclamation obligation liabilities to Talisker.
Avino Silver & Gold Mines Ltd. – February 26, 2020
Avino Reports Q4 and Year End 2019 Financial Results
Page 3
Operational Highlights and Overview
HIGHLIGHTS
(Expressed in US$)
Fourth Quarter
2019
Fourth Quarter
2018
Change
Year
2019
Year
2018
Change
Operating
Tonnes Milled 188,436 189,574 -1% 789,660 708,764 11%
Silver Ounces Produced 220,804 288,600 -23% 958,811 1,286,382 -25%
Gold Ounces Produced 2,032 1,973 3% 6,912 8,092 -15%
Copper Pounds Produced 1,389,515 1,375,758 1% 4,970,254 4,819,022 3%
Silver Equivalent Ounces1 Produced 608,640 720,187 -15% 2,397,042 2,863,753 -16%
Concentrate Sales and Cash Costs
Silver Equivalent Payable Ounces Sold3 700,191 713,384 -2% 2,345,453 2,640,129 -11%
Cash Cost per Silver Equivalent Payable Ounce1,2,3 $ 13.14 $ 8.93 47% $ 12.08 $ 9.32 30%
All-in Sustaining Cash Cost per Silver Equivalent
Payable Ounce1,2,3 $ 18.27 $ 11.69 56% $ 17.19 $ 12.94 33%
1. In 2019, AgEq was calculated using metals prices of $16.20 oz Ag, $1,393 oz Au and $2.72 lb Cu. In 2018, AgEq was calculated using metals p rices of$15.71 oz Ag,
$1,270 oz Au and $2.96 lb Cu
2. In Q4 2019, AgEq was calculated using metals prices of $17.32 oz Ag, $1,482 oz Au and $2.67 lb Cu. In Q4 2018, AgEq was calculated using metals prices of $14.55 oz
Ag, $1,229 oz Au and $2.80 lb Cu.
3. “Silver equivalent payable ounces sold” for the purposes of cash costs and all-in sustaining costs consists of the sum of payable silver ounces, gold ounces and copper
tonnes sold, multiplied by the ratio of the average spot gold and copper prices to the average spot silver price for the corresponding period.
4. The Company reports non-IFRS measures which include cash cost per silver equivalent payable ounce, all-in sustaining cash cost per payable ounce, EBITDA, adjusted
EBITDA, and cash flow per share. These measures are widely used in the mining industry as a benchmark for performance, but do not have a standardized meaning and
the calculation methods may differ from methods used by other companies with similar reported measures. See Non-IFRS Measures section for further information and
detailed reconciliations.
Change in Cost Calculation
In 2019, the Company updated the calculation of all -in sustaining cash costs to include penalties, treatment charges and refining
charges and the 2018 figures below have also been re-presented to include these costs. The change is due to the Company no longer
selling product from the San Gonzalo Mine, which historically had little to no penalties associated with the saleable concent rate, and
the Company is planning to be selling concentrate produced primarily from the Avino Mine for the foreseeable future.
Operational Overview
Consolidated Production Tables
*During the three months and year ended December 31, 2019, the Company produced 958 and 20,412 AgEq oz, respectively, of zinc by-product concentrate which has
been included in the “San Gonzalo” production category above.
Q4 2019
Production by Mine Tonnes
Processed
Silver
Oz
Gold
Oz
Copper
Lbs AgEq
Avino 107,310 153,644 1,676 1,293,508 495,496
San Gonzalo 2,908 4,106 26 - 6,964
Historic Above Ground Stockpiles 78,218 63,054 330 96,007 106,180
Consolidated 188,436 220,804 2,032 1,389,515 608,640
YTD 2019
Production by Mine Tonnes
Processed
Silver
Oz
Gold
Oz
Copper
Lbs AgEq
Avino 427,147 510,270 4,473 4,563,195 1,656,091
San Gonzalo 56,179 153,372 580 - 215,148
Historic Above Ground Stockpiles 306,334 295,169 1,859 407,059 525,803
Consolidated 789,660 958,811 6,912 4,970,254 2,397,042
Avino Silver & Gold Mines Ltd. – February 26, 2020
Avino Reports Q4 and Year End 2019 Financial Results
Page 4
*In Q4, 2019, AgEq was calculated using metals prices of $17.31 oz Ag, $1,482 oz Au and $2.73 lb Cu. In Q4, 2018, AgEq was calculated using metals prices of $14.55 oz
Ag, $1,229 oz Au and $2.80 lb Cu. Calculated figures may not add up due to rounding.
*In 2019, AgEq was calculated using metals prices of $1 6.20 oz Ag, $1,393 oz Au and $2.96 lb Cu. In 201 8, AgEq was calculated using metals prices of $1 5.71 oz Ag,
$1,270 oz Au and $2.96 lb Cu.
Non-IFRS Measures
The financial results in this news release include references to cash flow per share, cash cost per silver equivalent ounce, and all-in
sustaining cash cost per silver equivalent ounce, EBITDA and adjusted EBITDA, all of which are non-IFRS measures. Cash flow per share,
cash cost per ounce, and all-in sustaining cash cost per ounce are measures developed by mining companies in an effort to provide a
comparable standard of performance. However, there can be no assurance that our reporting o f these non-IFRS measures is similar
to that reported by other mining companies. Cash flow per share, cash cost per silver equivalent ounce, and all-in sustaining cash cost
per silver equivalent ounce are measures used by the Company to manage and evaluate operating performance of the Company’s
mining operations, and are widely reported in the silver and gold mining industry as benchmarks for performance, but do not h ave
standardized meanings prescribed by IFRS, and are disclosed in addition to the prescrib ed IFRS measures provided in the Company’s
financial statements and MD&A.
Conference Call and Webcast
In addition, the Company will be holding a conference call and webcast on Thursday, February 27, 2020 at 8:00 am PST (11:00 am EST).
Shareholders, analysts, investors and media are invited to join the webcast and conference call by logging in here Avino Fourth Quarter
and Year End 2019 Webcast and Conference Call or by dialing the following numbers five to ten minutes prior to the start time:
Toll Free Canada & USA: 1-800-319-4610
Outside of Canada & USA: 1-604-638-5340
No passcode is necessary to participate in the conference call or webcast; participan ts will have the opportunity to ask questions
during the Q&A portion.
The conference call and webcast will be recorded, and the replay will be available on the Company’s web site later that day.
Qualified Person(s)
Peter Latta, P.Eng, MBA, Avino’s VP Technical Services, and Jasman Yee, P.Eng., Avino Director, both of whom are qualified persons
within the context of National Instrument 43 -101 have reviewed and approved the technical data in this document. Avino’s Bralorne
project was under the supervisi on of Fred Sveinson, B.A., B.Sc., P. Eng., Senior Mining Advisor, who is a qualified person within the
context of National Instrument 43-101.
Q4 2019
Grade & Recovery by Mine Grade
Ag g/t
Grade
Au g/t
Grade
Cu %
Recovery
Ag %
Recovery
Au %
Recovery
Cu %
Avino 51 0.64 0.62 87% 76% 89%
San Gonzalo 53 0.38 - 78% 72% -
Historic Above Ground Stockpiles 51 0.25 0.18 50% 53% 31%
Consolidated 51 0.47 0.43 71% 67% 64%
YTD 2019
Grade & Recovery by Mine Grade
Ag g/t
Grade
Au g/t
Grade
Cu %
Recovery
Ag %
Recovery
Au %
Recovery
Cu %
Avino 44 0.45 0.56 85% 73% 86%
San Gonzalo 118 0.46 - 69% 66% -
Historic Above Ground Stockpiles 55 0.36 0.18 54% 53% 35%
Consolidated 54 0.41 0.40 72% 65% 64%
Avino Silver & Gold Mines Ltd. – February 26, 2020
Avino Reports Q4 and Year End 2019 Financial Results
Page 5
ON BEHALF OF THE BOARD
“David Wolfin”
________________________________
David Wolfin
President & CEO
Avino Silver & Gold Mines Ltd.
Safe Harbor Statement - This news release contains “forward -looking information” and “forward -looking statements” (together, the “forward looking statements”)
within the meaning of applicable Canadian securities laws and the United States Private Securities Litigation Reform Act of 1995, including, but are not limited to, the
Company’s ability to meet its production guidance, expectations of All -In Sustaining Cash Cost (“AISC”), information on the updated mineral resource esti mate for the
Company’s Avino Property located near Durango in west -central Mexico (the “Property”) with an effective date of February 21, 2018, and amended on December 19,
2018, prepared for the Company, and reference to Measured, Indicated, Inferred Resources referred to in this press release. These forward-looking statements are made
as of the date of this news release and the dates of technical reports, as applicable. Readers are cautioned not to place undue reliance on forward-looking statements,
as there can be no assurance that the future circumstances, outcomes or results anticipated in or implied by such forward -looking statements will occur or that plans,
intentions or expectations upon which the forward-looking statements are based will occur. While we have based these forward-looking statements on our expectations
about future events as at the date that such statements were prepared, the statements are not a guarantee that such future events will occur and are subject to risks,
uncertainties, assumptions and other factors which could cause events or outcomes to differ materially from those expressed or implied by such fo rward-looking
statements. No assurance can be given that the Company’s Property does not have the amount of the mineral resources i ndicated in the updated report or that such
mineral resources may be economically extracted.
Such factors and assumptions include, among others, the effects of general economic conditions, the price of gold, silver and copper, changing foreign exchange rates
and actions by government authorities, uncertainties associated with legal proceedings and negotiations and misjudgments in the course of preparing forward-looking
information. In addition, there are known and unknown risk factors which could cause our actual results, performance or achievements to differ materially from any
future results, performance or achievements expressed or implied by the forward -looking statements. Known risk factors include risks associated with project
development; the need for additional financing; operational risks associated with mining and mineral processing; fluctuations in metal prices; title matters; uncertainties
and risks related to carrying on business in foreign countries; environmental liability claims and insurance; reliance on key personnel; the potential for conflicts of interest
among certain of our officers, directors or promoters with certain other projects; the absence of dividends; currency fluctuations; competition; dilution; the volatility of
the our common share price and volume; tax consequences to U.S. investors; and other risks and uncertainties. Although we have attempted to identify important factors
that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions,
events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results
and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
We are under no obligation to update or alter any forward-looking statements except as required under applicable securities laws.
Cautionary Note Regarding Non-GAAP Measures
This news release includes certain terms or performance measures commonly used in the mining industry that are not defined un der International Financial Reporting
Standards (“IFRS”), including silver equivalent ounces (AgEq oz) of production. Non-GAAP measures do not have any standardized meaning prescribed under IFRS and,
therefore, they may not be comparable to similar measures reported by other companies. We believe that, in addition to conventional measures prepared in accordance
with IFRS, certain investors use this information to evaluate our performance. The data presented is intended to provide addi tional information and should not be
considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Readers should also refer to our management’s discussion and
analysis available under our corporate profile at www.sedar.com or on our website at www.avino.com.