Dynacor Group Reports Quarterly Sales of $67.4 Million, a Net Income of $4.5 Million IN Q2-2024 (US$0.12 OR CA$0.16 PER Share) and a Record EBITDA of $8.3 Million
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DYNACOR GROUP REPORTS QUARTERLY SALES OF $67.4 MILLION,
A NET INCOME OF $4.5 MILLION IN Q2-2024
(US$0.12 OR CA$0.16 PER SHARE) AND
A RECORD EBITDA OF $8.3 MILLION
Montreal, August 15, 2024 – Dynacor Group Inc. (TSX: DNG) (Dynacor or the Corporation) released
its unaudited condensed interim consolidated financial statements and the management's discussion and
analysis (MD&A) for the second quarter ended June 30, 2024.
These documents have been filed electronically with SEDAR+ at www.sedarplus.com and will be available
on the Corporation's website www.dynacor.com.
(All figures in this press release are in Ms of US$ unless stated otherwise . All amounts per share are in US$. All variance % are
calculated from rounded figures. Some additions might be incorrect due to rounding).
Q2-2024 OVERVIEW AND HIGHLIGHTS
OVERVIEW
Dynacor completed the three-month period ended June 30, 202 4 (“Q2-2024”) with quarterly sales of
$67.4 million, a net income of $ 4.5 million (US$0. 12 per share) and a record EBITDA of $8.3 million
compared to sales of $64.5 million, a net income of $ 4.5 million (US$0.12 per share) and an EBITDA of
$6.6 million for the second quarter of 2023 (“Q2-2023”).
During Q2-2024, the Chala plant has continued to run at its maximum 500 tpd capacity, processing almost
43,000 tonnes.
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HIGHLIGHTS
Operational
• Ore volume supplied remained high. Total ore volume supplied reached 42,883 tonnes in Q2-2024
compared to 45,730 tonnes for the same period of last year;
• Higher volume processed. The Veta Dorada plant processed a volume of 42,935 tonnes of ore
(472 tpd average) compared to 40,747 tonnes in Q2-2023 (448 tpd), a 5.4% increase;
• Gold production reduced due to lower grades of ore processed . In Q2-2024, gold equivalent
production reached 28,364 AuEq ounces compared to 32,693 AuEq ounces in Q2-2023.
Financial
• Increases in gold prices from March and operational results positively impacted the Q2-2024
financial results.
• Increased Sales. Sales amounted to $67.4 million in Q2-2024 compared to $64.5 million in Q2-2023,
a 4.5% increase;
• Record gross operating margin of $10.0 million (14.8% of sales) in Q2-2024, compared to $7.7 million
(11.9% of sales) in Q2-2023;
• Increase of 33.9% in operating income. Operating income of $ 7.5 million in Q2-2024 compared to
$5.6 million in Q2-2023;
• Record c ash gross operating margin of $375 per AuEq ounce sold (1) compared to $ 256 in
Q2-2023, a 46.5% increase;
• Record EBITDA (2) of $8.3 million, compared to $6.6 million in Q2-2023, a 25.8% increase;
• Increased cash flows. Cash flows from operating activities before change in working capital items of
$5.8 million ($0. 16 per share) (3) compared to $ 5.2 million ($0. 14 per share) in Q 2-2023, a
11.5% increase;
• Strong net income. Dynacor Group recorded a net income of $ 4.5 million in Q2-2024 (US$0.12 or
CA$0.16 per share) similar to Q2-2023;
• Solid cash position. Cash on hand of $3 4.7 million at the end of Q2 -2024 compared to $22.5 million
at year end 2023;
Return to Shareholders
• Share buy-back. 37,200 common shares repurchased for $0.1 million (CA$0.2 million) in Q2-2024,
compared to 40,300 common shares for $0.1 million (CA$0.1 million) in Q2-2023;
• Increased dividends. A 16.7% monthly dividend increase is paid since January 202 4. On an annual
basis, the 2024 dividend will represent CA$0.14 per share or 2.7% dividend yield based on the current
share price.
(1) Cash gross operating margin per AuEq ounce is in US$ and is calculated by subtracting the average cash cost of sale per equivalent
ounces of Au from the average selling price per equivalent ounces of Au and is a non -IFRS financial performance measure with no
standard definition under IFRS Accounting Standards. It is therefore possible that this measure could not be comparable with a similar
measure of another company.
(2) EBITDA: “Earnings before interest, taxes and depreciation” is a non-IFRS financial performance measure with no standard definition
under IFRS Accounting Standards. It is therefore possible that this measure could not be comparable with a similar measure of
another corporation. The Corporation uses this non-IFRS measure as an indicator of the cash generated by the operations and allows
investor to compare the profitability of the Corporation with others by canceling effects of different assets basis, effects due to different
tax structures as well as the effects of different capital structures.
(3) Cash-flow per share is a non-IFRS financial performance measure with no standard definition under IFRS Accounting Standards.
It is therefore possible that this measure could not be comparable with a similar measure of another corporation. The Corpora tion
uses this non-IFRS measure which can also be helpful to investors as it provides a result which can be compared with the Corporation
market share price.
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RESULTS FROM OPERATIONS
Unaudited Consolidated Statement of net income and comprehensive income
Total sales amounted to $67.4 million compared to $64.5 million in Q2-2023. The $2.9 million increase is
explained by higher average gold price (+$10.5 million) partially offset by lower quantities of gold ounces
sold (-$7.6 million) due to lower grades of ore processed.
Cumulative sales increased by $ 13.9 million compared to last year with higher average gold price
(+$16.8 million) partially offset by lower quantities of gold ounces sold (-$2.9 million).
The gross operating margin increased by $2.3 million from $7.7 million (11.9% of sales) in Q2 -2023 to a
record of $10.0 million (14.8% of sales) in Q2-2024 and was positively impacted by the increasing trend in
gold market prices during the period compared to a decreasing trend in Q2-2023.
General and administrative expenses amounted to $2.1 million compared to $1.8 million in Q2-2023. The
increase is explained by increases in employee expenses.
As budgeted, o ther projects represent the expenses incurred by the Corporation to duplicate its unique
business model in other jurisdictions.
The Q2-2024 net income was also affected by the recording of a $3.1 million income tax expense including
a $0.2 million (non-cash) deferred income tax expense ($1.5 million including the recording of withholding
taxes on dividends received from a Peruvian subsidiary and a d eferred tax recovery of $0.3 million in
Q2-2023). The tax expense (current and deferred) is affected by the variance throughout the period of the
Peruvian Sol against the US$. Future fluctuations will affect positively or negatively the current and deferred
tax at the end of each period.
Three-month periods
ended June 30,
Six-month periods
ended June 30,
(in $'000) (unaudited) 2024 2023 2024 2023
Sales 67,431 64,472 135,164 121,205
Cost of sales (57,437) (56,817) (116,022) (105,721)
Gross operating margin 9,994 7,655 19,142 15,484
General and administrative expenses (2,127) (1,813) (3,831) (3,366)
Other projects expenses (327) (202) (541) (426)
Operating income 7,540 5,640 14,770 11,692
Financial income net of expenses 168 163 339 316
Foreign exchange gain (loss) (125) 161 (184) 211
Income before income taxes 7,583 5,964 14,925 12,219
Current income tax expense (2,841) (1,828) (5,418) (3,807)
Deferred income tax (expense) recovery (241) 343 (225) 534
Net income and comprehensive
income 4,501 4,479 9,282 8,946
Earnings per share
Basic $0.12 $0.12 $0.25 $0.23
Diluted $0.12 $0.12 $0.25 $0.23
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Reconciliation of non-IFRS measures
CONSOLIDATED CASH FLOW FROM OPERATING, INVESTING AND FINANCING ACTIVITIES AND
WORKING CAPITAL AND LIQUIDITY
Operating activities
During Q2 -2024, the cash flow from operations, before changes in working capital items, amounted to
$5.8 million ($ 11.5 million for the six -month period ending June 30, 202 4), compared to $ 5.2 million in
Q2-2023 ($10.2 million for the six-month period ending June 30, 2023).
During Q2-2024, total cash from operating activities amounted to $ 9.7 million ($ 19.3 million for the six -
month period ending June 30, 202 4) compared to $1.4 million in Q2-2023 ($11.2 million for the six-month
period ending June 30, 2023). Changes in working capital items amounted to $ 3.9 million ($7.8 million for
the six-month period ending June 30, 2024) compared to -$3.8 million in Q2-2023 ($1.0 million for the six-
month period ending June 30, 2023). The variances are mainly attributable to variances in inventories.
Investing activities
During the three -month period ended June 30, 202 4, the Corporation invested $1. 6 million (cumulative
six-month 2024 of $2.3 million). These amounts mainly include investments at the plant and new vehicles.
All investments have been financed with internally generated cash-flows.
Financing activities
In Q2-2024, monthly dividends totaling CA$0.0 35 per share were disbursed for a total consideration of
$0.9 million (CA$1.3 million) (cumulative six-month of CA$0.0 7). In Q 2-2023, monthly dividends totaling
CA$0.03 per share were disbursed for a total consideration of $0. 8 million (CA$1.2 million). Increases in
monthly dividend were disbursed from January 2023 and then from January 2024.
In Q2-2024, 37,200 common shares were repurchased under the Corporation normal course issuer bid
share buyback program for a total cash consideration of $0.1 million (CA$0.2 million) (cumulative six-month
of 964,000 shares) (40,300 shares for a total cash consideration of $0.1 million (CA$0. 1 million) in
Q2-2023).
Working capital and liquidity
As at June 30, 2024, the Corporation’s working capital increased to $55.3 million, including $34.7 million in
cash ($50.8 million, including $22.5 million in cash at December 31, 2023).
(in $’000) (unaudited) Three-month periods
ended June 30, Six-month periods
ended June 30,
2024 2023 2024 2023
Reconciliation of net income and
comprehensive income to EBITDA
Net income and comprehensive income 4,501 4,479 9,282 8,946
Income tax expenses (current and
deferred) 3,082 1,485 5,643 3,273
Financial income net of expenses (186) (170) (357) (323)
Depreciation 911 833 1,796 1,617
EBITDA 8,308 6,627 16,364 13,513
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CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at June 30, 2024, total assets amounted to $ 114.7 million ($111.8 million as at December 31, 202 3).
Major variances since last year-end come from the significant increase in cash and working capital items
due to the good financial performance.
(in $'000) (unaudited)
As at
June 30,
As at
December 31,
2024 2023
Cash 34,734 22,481
Accounts receivable 9,371 13,328
Inventories 25,612 31,925
Prepaid 635 277
Property, plant and equipment 25,181 24,590
Right-of-use assets 569 613
Exploration and evaluation assets 18,566 18,566
Other non-current assets 54 -
Total assets 114,722 111,780
Trade and other payables 12,689 15,357
Current tax liabilities 2,369 1,799
Asset retirement obligations 3,768 3,724
Deferred tax liabilities 902 677
Lease liabilities 586 636
Shareholders' equity 94,408 89,587
Total liabilities and equity 114,722 111,780
FOLLOW-UP OUTLOOK 2024
Ore processing
For 2024, the Corporation forecasted sales (1) ranging between $265-285 million representing a growth of
6-14% over 2023 sales. Net income is forecasted ranging between $12 -15 million ($0.33-0.41 per share)
(CA$0.45-0.56 per share) and include expenses of $2.7 million to advance other projects in other
jurisdictions. So far in 2024, the Corporation is in line with its financial forecast.
(1) Using a market gold price ranging between $2,000 and $2,050 per ounce
Capex
Dynacor Group planned to invest up to $13 million in capital expenditures in 2024. This investment will be
used at our Veta Dorada plant for new equipment to improve efficiency, increase tailing pond capacity, buy
vehicles to support the security of our purchasers working in remote areas and will include, upon favourable
conditions, up to $4 million to pursue the due diligence process and development of new projects in other
jurisdictions.
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ABOUT DYNACOR
Dynacor is a dividend-paying industrial gold ore processor headquartered in Montreal, Canada. The corporation is engaged in gold
production through the processing of ore purchased from the ASM (artisanal and small -scale mining) industry. At present, Dynacor
operates in Peru, where its management and processing teams have decades of experience working with ASM miners. It also owns
a gold exploration property (Tumipampa) in the Apurimac department.
The corporation intends to expand its processing operations in other jurisdictions as well.
Dynacor produces environmental and socially responsible gold through its PX IMPACT® gold program. A growing number of
supportive firms from the fine luxury jewelry, watchmakers and investment sectors pay a small premium to our customer and strategic
partner for this PX IMPACT® gold. The premium provides direct investment to develop health and education projects for our artisanal
and small-scale miner’s communities.
Dynacor is listed on the Toronto Stock Exchange (DNG).
FORWARD-LOOKING INFORMATION
Certain statements in the preceding may constitute forward-looking statements, which involve known and unknown risks, uncertainties
and other factors that may cause the actual results, performance, or achievements of Dynacor, or industry results, to be mate rially
different from any future result, performance or achievement expressed or implied by such forward -looking statements. These
statements reflect management’s current expectations regarding future events and operating performance as of the date of this news
release.
Shares Outstanding: 36,431,706
Website: http://www.dynacor.com
Twitter: http://twitter.com/DynacorGold
CONTACT: For more information, please contact:
Director, Shareholder Relations
Dale Nejmeldeen
Dynacor Group Inc.
T: 514-393-9000 #230