DUNDEE PRECIOUS METALS ANNOUNCES 2018 SECOND QUARTER RESULTS AND UPDATED GUIDANCE (All monetary figures are expressed in U.S. dollars
DUNDEE PRECIOUS METALS ANNOUNCES
2018 SECOND QUARTER RESULTS AND UPDATED GUIDANCE
(All monetary figures are expressed in U.S. dollars unless otherwise stated)
Toronto, Ontario, July 31, 2018 – Dundee Precious Metals Inc. (TSX: DPM)
SECOND QUARTER FINANCIAL AND OPERATING HIGHLIGHTS:
Metals production – Achieved gold production of 48,272 ounces and copper production of 8.5 million
pounds in the quarter. 2018 gold production guidance updated, reflecting higher grades and recoveries;
Smelter – Achieved 46,409 tonnes of throughput and completed the 24-day furnace maintenance
shutdown, in line with expectations. Annual throughput remains on track to achieve 2018 guidance;
Near term growth opportunities – Krumovgrad construction remains under budget and is on track to
achieve first concentrate production late in the fourth quarter of 2018;
Cash flow – Generated $19.9 million in cash flow from operating activities and $22.1 million in free cash
flow(1); and
Financial position – Ended the second quarter of 2018 with approximately $ 250 million of cash
resources, including long-term revolving credit facility.
Dundee Precious Metals Inc. (“DPM” or the “Company”) today reported second quarter net earnings
attributable to common shareholders of $16.4 million ($0.09 per share) compared to $11.0 million ($0.06 per
share) for the same period in 2017. Net earnings attributable to common shareholders in the first six months of
2018 were $19.1 million ($0.11 per share) compared to a net loss $1.5 million ($0.01 per share) for the same
period in 2017.
Net earnings (loss) attributable to common shareholders in the second quarter and first six months of 2018 and
2017 were impacted by several items not reflective of the Company’s underlying operating performance,
including unrealized gains and losses on commodity price and foreign exchange hedges that in 2017, prior to
the adoption of IFRS 9, did not receive hedge accounting, and net gains and losses on Sabina special warrants,
each of which are excluded from adjusted net earnings.
Adjusted net earnings(1) in the second quarter of 2018 were $13.7 million ($0.08 per share) compared to $11.9
million ($0.07 per share) for the same period in 2017. This increase was due primarily to higher volumes of
copper concentrate deliveries as a result of the timing of deliveries and higher realized gold and copp er
prices, partially offset by lower volumes of complex concentrate smelted and acid deliveries as a result of
the Ausmelt furnace maintenance shutdown, a weaker U.S. dollar relative to the Euro and the ZAR, and
higher stockpile interest and lower estimated metal recoveries at Tsumeb.
Adjusted net earnings in the first six months of 2018 were $14.3 million ($0.08 per share) compared to $5.7
million ($0.03 per share) for the same period in 2017. This improvement was due primarily to higher realized
gold and copper prices , higher volumes of payable gold and copper in concentrate sold as a result of
increased gold and copper production and higher estimated metal recoveries at Tsumeb, partially offset by
a weaker U.S. dollar relative to the Euro and the ZAR, and lower third party toll rates and increased stockpile
interest at Tsumeb.
Adjusted EBITDA
Adjusted EBITDA (1) during the second quarter and first six months of 2018 was $31.6 million and $51.1
million compared to $31.2 million and $44.7 million in the corresponding periods in 2017 reflecting the same
factors that affected adjusted net earnings, except for depreciation, interest and income taxes, which are
excluded from adjusted EBITDA.
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"We had another strong quarter at Chelopech resulting in 2018 gold production guidance being increased,”
said Rick Howes, President and CEO. “ The Ausmelt furnace maintenance shutdown was successfully
completed in the period and we continue to improve performance at Tsumeb. Our Krumovgrad gold project is
progressing well and, while slightly behind schedule, remains on track to achieve production of first concentrate
late in the fourth quarter of 2018. As a result, we expect a significant increase in gold production and operating
cash flows in 2019 and beyond following the completion of Krumovgrad."
Production
In the second quarter of 2018, gold contained in concentrate produced decreased by 10% to 48,272 ounces
relative to the corresponding period in 2017 due primarily to lower gold grades, partially offset by higher gold
recoveries. Copper production in the second quarter of 2018 of 8.5 million pounds was comparable to the
corresponding period in 2017.
In the first six months of 2018, gold contained in concentrate produced increased by 6% to 105,603 ounces
and copper production increased by 6% to 17.8 million pounds, in each case, relative to the corresponding
period in 2017. The increase in gold production was due primarily to higher gold recoveries and higher than
anticipated gold grades. The increase in gold recoveries was due primarily to different ore mineralogy and the
benefits of various initiatives with a specific focus on improving metallurgical performance. The increase in
copper production was due primarily to higher copper grades.
Complex concentrate smelted during the second quarter of 2018 of 46,409 tonnes was 23% or 14,234 tonnes
lower than the corresponding period in 2017 due primarily to the timing of the Ausmelt furnace maintenance
shutdown that resulted in 24 days of downtime in the period. Continued improvement in refractory performance
enabled the furnace maintenance shutdown to be deferred from March to May 2018.
Complex concentrate smelted during the first six months of 2018 of 100,551 tonnes was essentially the
same as the corresponding period in 2017 affected by power related instability during the first quarter rainy
season and Ausmelt off -gas system related downtime. The off -gas system refurbishment during the May
maintenance shutdown is expected to provide improved operating continu ity in the second half of 2018
and, as such, the full year 2018 concentrate throughput is expected to be within guidance.
Deliveries
In the second quarter of 2018, payable gold in concentrate sold increased by 45% to 54,660 ounces and
payable copper increased by 54% to 10.4 million pounds, in each case, relative to the corresponding period
in 2017. These increases were consistent with the increase in copper concentrate deliveries due to the
timing of deliveries.
In the first six months of 2018, payab le gold in concentrate sold increased by 11% to 89,816 ounces and
payable copper increased by 9% to 16.5 million pounds, in each case, relative to the corresponding period
in 2017. These increases were consistent with the increase in copper concentrate del iveries as a result of
increased copper concentrate production as well as higher gold and copper grades and higher gold
recoveries.
Cost Measures
Cost of sales in the second quarter of 2018 of $75.6 million was $12.1 million higher than the corresponding
period in 2017 due primarily to higher copper concentrate deliveries and a weaker U.S. dollar relative to the
Euro and the ZAR, partially offset by lower depreciation and a decrease in variable operating costs at Tsumeb
as a result of the Ausmelt furnace maintenance shutdown in the period. Cost of sales in the second quarter of
2018 also included a $5.5 million adjustment to reclassify certain costs previously reported as general and
administrative expenses in respect of MineRP, which was acquired in the fourth quarter of 2017.
Cost of sales in the first six months of 2018 of $137.3 million was $10.9 million higher than the corresponding
period in 2017 due primarily to higher copper concentrate deliveries as a result of increased copper concentrate
production and a weaker U.S. dollar relative to the Euro and the ZAR, partially offset by lower depreciation.
Cost of sales in the first six months of 2018 also included $6.1 million from MineRP.
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All-in sustaining cost per ounce of gold(1) in the second quarter and first six months of 2018 of $540 and $601,
respectively, was $164 and $106 lower than the corresponding periods in 2017. These decreases were due
primarily to higher by-product credits as a result of higher realized copper prices and volumes of copper sold,
and lower cash outlays for sustaining capital expenditures, partially offset by a stronger Euro relative to the
U.S. dollar.
Cash cost per tonne of complex concentrate smelted, net of by-product credits(1), during the second quarter
of 2018 of $548 was 31% or $131 higher than the corresponding period in 201 7 due primarily to lower
volumes of complex concentrate smelted, higher labour costs and electricity rates, a stronger ZAR relative
to the U.S. dollar and lower acid by-product credits, partially offset by Tsumeb’s cost reduction program,
which resulted in lower contractor and consultant expenses.
Cash cost per tonne of complex concentrate smelted, net of by-product credits, during the first six months
of 2018 of $522 was 11% or $50 higher than the corresponding period in 2017 due primarily to higher labour
costs and electricity rates and a stronger ZAR relative to the U.S. dollar, partially offset by higher acid by-
product credits and Tsumeb’s cost reduction program, which resulted in lower contractor and consultant
expenses.
Cash provided from operating activities
Cash provided from operating activities in the second quarter of 2018 was $19.9 million compared to $17.1
million in the corresponding period in 2017. This increase was due primarily to the timing of the settlement
of derivative contracts. Cash provided from operating activities in the first six months of 2018 was $30.9
million compared to $51.7 million in the corresponding period in 201 7. This decrease was due primarily to
an unfavourable period over period change in non -cash working capital and higher income taxes paid ,
partially offset by improved financial results.
Cash provided from operating activities, before changes in non -cash working capital (1), during the second
quarter and first six months of 2018 was $28.6 million and $47.0 million, respectively, compared to $25.7
million and $42.7 million in the corresponding periods in 2017.
Free Cash Flow
Free cash flow in the second quarter and first six months of 2018 was $22.1 million and $33.1 million,
respectively, compared to $ 2.3 million and $13.6 million in the corresponding period s in 201 7. These
increases were due primarily to the repayment of term loans of $16.3 million in the second quarter of 2017
and higher cash provided from operating activities before changes in non -cash working capital.
Capital Expenditures
Capital expenditures during the second quarter and first six months of 2018 were $26.8 million and $57.2
million, respectively, compared to $20.7 million and $42.7 million in the corresponding periods in 2017.
Growth capital expenditures(1) during the second quarter and first six months of 2018 were $20.8 million and
$45.9 million, respectively, compared to $16.8 million and $33.1 million in the corresponding periods in 2017.
These increases were due primarily to increased construction activities at the Krumovgrad gold project in 2018.
Sustaining capital expenditures (1) during the second quarter and first six months of 2018 were $6.0 million
and $11.3 million, respectively, compared to $3.9 million and $9.6 million in the corresponding periods in
2017, in line with higher planned 2018 expenditures.
Krumovgrad Project
Construction continued through the first half of the year and, as at June 30, 2018, the project was approximately
71% complete, based on installed quantities, compared with a planned completion of 78%. Additional civil
construction resources were mobilized to site to mitigate delays with concrete installation. First concentrate
production is forecast for late in the fourth quarter of 2018.
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Serbia
During the second quarter of 2018, a total of 3,174 metres of diamond drilling was completed at the Timok
gold project. A Mineral Resource update is currently in progress and the results are expected in September
2018. The Mineral Resource update will reflect updated geologic interpretations and weathering profiles for
Bigar Hill, Korkan, Korkan West and Kraku Pester, as well as additional exploration results .
Metallurgical test work, concluded in June 2018, included coarse ore bottle roll tests as well as column
leach tests. The nine-week column leach results indicated gold extractions of 94% for the Korkan and Bigar
Hill oxide samples, 76% for the Korkan West oxide sample and 68% for the Korkan transitional
sample. DPM now plans to undertake a more comprehensive ore characte rization test work program to
support moving forward with a potential scoping study.
Exploration
Diamond drilling at the Krasta target , approximately 1.5 kilometres northwest of the main Chelopech
orebodies, outlined a new zone of gold-copper mineralization over a strike length of about 250 metres
between 130 and 280 metres from surface. All six holes drilled in the second quarter and an additional two
holes completed in July intersected gold-copper mineralization, including 94 metres at 0.61 g/t gold and
0.27 % copper (1.17 g/t AuEq) in hole EX_KR_06 (true width estimated to be 70 metres). The mineralization
at Krasta is open to the northeast and southwest as well as above and below the current level of drilling.
At Surnak, located approximately four kilometres to the east of the Krumovgrad gold project mine site, the
last holes of Phase 1 resource drilling were completed. Assays from all holes were received and show that
the mineralization continues down-dip and is open to the east.
At the Malartic Joint Venture Project in Quebec, a ll assay results were received for the 1,942 metre scout
drilling program completed in early April 2018. Significant results, in addition to those reported in the first
quarter of 2018, include 7.15 g/t gold over 3.3 metres in hole MLDD007.
Financial Position
As at June 30, 2018, DPM had cash of $13.9 million, investments valued at $35.0 million primarily related to
its 10% interest in Sabina, and $236.0 million of undrawn capacity under its committed long-term revolving
credit facility.
(1) Adjusted net earnings, adjusted basic earnings per share, adjusted earnings before interest, taxes, depreciation and amortization
(“EBITDA”), all-in sustaining cost per ounce of gold, cash cost per tonne of complex concentrate smelted, net of by-product credits,
cash provided from operating activities, before changes in non-cash working capital, free cash flow, and growth and sustaining capital
expenditures have no standardized meaning under International Financial Reporting Standards ("IFRS"). Presenting these measures
from period to period helps management and investors evaluate earnings and cash flow trends more readily in comparison with results
from prior periods. Refer to the “Non-GAAP Financial Measures” section of the Management’s Discussion and Analysis for the three
and six months ended June 30, 2018 (the “MD&A”) for further discussion of these items, including reconciliations to IFRS measures.
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KEY FINANCIAL AND OPERATIONAL HIGHLIGHTS
$ millions, except where noted
Ended June 30,
Three Months Six Months
2018 2017 2018 2017
Revenue 102.9 86.9 189.8 161.5
Cost of sales 75.6 63.5 137.3 126.4
Other expense (1.8) (2.4) (4.9) (15.0)
Earnings before income taxes 18.8 12.8 24.4 1.3
Net earnings (loss) attributable to common shareholders 16.4 11.0 19.1 (1.5)
Basic earnings (loss) per share 0.09 0.06 0.11 (0.01)
Adjusted EBITDA(1) 31.6 31.2 51.1 44.7
Adjusted net earnings(1) 13.7 11.9 14.3 5.7
Adjusted basic earnings per share(1) 0.08 0.07 0.08 0.03
Cash provided from operating activities 19.9 17.1 30.9 51.7
Cash provided from operating activities, before changes
in non-cash working capital(1) 28.6 25.7 47.0 42.7
Free cash flow(1) 22.1 2.3 33.1 13.6
Metals contained in copper and pyrite concentrates
produced:
Gold (ounces)(2) 48,272 53,474 105,603 99,845
Copper (‘000s pounds) 8,545 8,664 17,806 16,843
Silver (ounces) 44,708 44,278 99,075 95,913
Payable metals in copper and pyrite concentrates sold:
Gold (ounces)(3) 54,660 37,659 89,816 81,137
Copper (‘000s pounds) 10,398 6,761 16,482 15,077
Silver (ounces) 54,090 36,324 90,587 78,753
All-in sustaining cost per ounce of gold(1) 540 704 601 707
Complex concentrate smelted at Tsumeb (tonnes) 46,409 60,643 100,551 102,278
Cash cost per tonne of complex concentrate smelted at
Tsumeb, net of by-product credits(1) 548 417 522 472
1) Adjusted EBITDA; adjusted net earnings; adjusted basic earnings per share; cash provided from operating activities, before changes in non-cash working
capital; free cash flow; all-in sustaining cost per ounce of gold; and cash cost per tonne of complex concentrate smelted, net of by-product credits are not
defined measures under IFRS. Refer to the “Non-GAAP Financial Measures” section of the MD&A for reconciliations to IFRS measures.
2) Includes gold contained in pyrite concentrate produced in the second quarter and first six months of 2018 of 14,852 ounces and 30,000 ounces,
respectively, compared to 15,525 ounces and 29,223 ounces for the corresponding periods in 2017.
3) Includes payable gold in pyrite concentrate sold in the second quarter and first six months of 2018 of 9,559 ounces and 20,114 ounces, respectively,
compared to 7,889 ounces and 17,629 ounces for the corresponding periods in 2017.
DPM’s unaudited condensed interim consolidated financial statements and MD&A for the three and six
months ended June 30, 2018 are posted on the Company’s website at www.dundeeprecious.com and have
been filed on SEDAR at www.sedar.com.
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2018 Guidance
2018 gold production and sales guidance for Chelopech has been increased to reflect the strong
performance achieved in the first six months of 2018. Sustaining capital expenditures have been revised to
reflect the timing of expenditures in respect of certain projects to 2019. As a result of these changes, all -in
sustaining cost per ounce of gold guidance was also revised. 2018 cash cost per tonne of complex
concentrate smelted, net of by -product credits, has been revised to reflect additional ZAR hedges put in
place in the second quarter of 2018.
The Company’s updated guidance for 2018, together with its original guidance, is set out in the following
table:
$ millions, unless otherwise indicated
Chelopech
Tsumeb
Updated
Consolidated
Guidance
Original
Consolidated
Guidance
Ore milled (‘000s tonnes) 2,100 – 2,200 - 2,100 – 2,200 2,100 – 2,200
Cash cost per tonne of ore processed(3),(4) 35 – 38 - 35 – 38 37 – 40
Metals contained in concentrate
produced(1),(2)
Gold (‘000s ounces) 180 – 200 - 180 – 200 165 – 195
Copper (million pounds) 33.7 – 40.4 - 33.7 – 40.4 33.7 – 40.4
Payable metals in concentrate sold(1)
Gold (‘000s ounces) 155 – 172 - 155 – 172 140 – 170
Copper (million pounds) 31.0 – 37.0 - 31.0 – 37.0 31.0 – 37.0
All-in sustaining cost per ounce of gold(3),(4),(5) - - 640 – 755 640 – 855
Complex concentrate smelted (‘000s tonnes) - 220 – 250 220 – 250 220 – 250
Cash cost per tonne of complex concentrate
smelted, net of by-product credits(3),(4) - 430 – 480 430 – 480 440 – 500
Corporate general and administrative
expenses(3),(6) - - 20 – 24 20 – 24
Exploration expenses(3) - - 10 – 15 10 – 15
Sustaining capital expenditures(3),(4) 13 – 15 15 – 18 28 – 33 29 – 39
1) Gold produced includes gold in pyrite concentrate produced of 47,000 to 55,000 ounces and payable gold sold includes payable gold in pyrite concentrate
sold of 30,000 to 35,000 ounces.
2) Metals contained in concentrate produced are prior to deductions associated with smelter terms.
3) Based on Euro/US$ exchange rate of 1.20, US$/ZAR exchange rate of 12.89 and copper price of $2.76 per pound, where applicable.
4) Cash cost per tonne of ore processed, all-in sustaining cost per ounce of gold and cash cost per tonne of complex concentrate smelted, net of by-product
credits, and sustaining capital expenditures have no standardized meaning under IFRS. Refer to the “Non-GAAP Financial Measures” section of the MD&A
for more information.
5) Includes the treatment charges, transportation and other selling costs related to the sale of pyrite concentrate, and payable gold in pyrite concentrate sold.
All-in sustaining cost per ounce of gold, excluding payable gold in pyrite concentrate sold and related costs, is expected to be between $630 and $750 in
2018.
6) Excludes mark-to-market adjustments on share-based compensation and MineRP Holdings Inc.’s (“MineRP”) general and administrative expenses.
The 2018 guidance provided above is not expected to occur evenly throughout the year. The estimated
metals contained in concentrate produced, payable metals in concentrate sold an d volumes of complex
concentrate smelted are expected to vary from quarter to quarter depending on the areas being mined, the
timing of concentrate deliveries and planned outages. The rate of capital expenditures is also expected to
vary from quarter to quarter based on the schedule for, and execution of, each capital project.
Chelopech
Total gold production in the first six months of 2018 was higher than anticipated as a result of higher gold
grades in the zones mined and higher recoveries, resulting in an increase in 2018 gold production and sales
guidance.
Tsumeb
The 24 -day maintenance shutdown was successfully executed in the second quarter of 2018 and
concentrate smelted in the period was in line with expectations. The maintenance shutdown was deferred
from March to May due to a significantly improved refractory campaign of 15 months representing both a
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time and tonnage record and it is expected that these campaigns can be extended in the future so as to
support further improvements in performance. Complex concentrate smelted in the first half of 2018 was
affected by power related instability during the first quarter rainy season and Ausmelt off-gas system related
downtime. The off -gas system refurbishment during the May shutdown is expected to provide improved
operating continuity in the second half of 2018 and, as such, the full year 2018 concentrate throughput is
expected to be within guidance. Following the furnace maintenance shutdown, the sme lter has performed
well and concentrate smelted in July surpassed the prior production record demonstrating the incremental
improvements being achieved in smelting operations.
Krumovgrad
Construction continued through the quarter in accordance with the p roject execution plan. As at June 30,
2018, the project was approximately 71% complete, based on installed quantities, compared with a planned
completion of 78%. Additional civil construction resources were mobilized to site to mitigate delays
experienced with concrete installation. Mine blasting and ore stockpiling commenced in July as per schedule.
First concentrate production is forecast for late in the fourth quarter of 2018. The final estimated construction
cost continues to be between $16 4 million and $168 million, compared with the original budget of $178
million.
Serbia
Following the discovery of the Korkan West deposit in 2017, DPM is continuing to advance exploration of
this area in 2018 with the goal of adding more ounces to the existing Timok gold resource. DPM is working
on an updated resource estimate for Timok, expected in the third quarter of 2018, which will factor in
updated drilling at Korkan West and reporting of oxide, transitional and sulfide zones within the
mineralization. Following encouraging column leach tests, DPM now plans to undertake a more
comprehensive ore characterization test work program to support moving forward with a potential scoping
study.
Growth capital
The Company’s total growth capital expenditures are expected to range between $9 4 million and $10 0
million, which primarily relate to the completion of the Krumovgrad gold project. The balance of $9 million
to $11 million of additional growth capital includes $2 million of resource development drilling at Chelopech,
as well as $7 million to $9 million of margin improvement projects at Chelopech and Tsumeb.
Growth and Exploration
Given DPM’s strong financial position and expected surplus cash flow generation commencing in 2019,
DPM is strongly positioned to grow the business beyond its existing operating and development assets and
is actively identifying opportunities to grow its business in a disciplined manner.
The exploration budget for 2018 was increased to approximately $14 million from $9 million in 2017. T he
increased budget will fund major drilling programs at Chelopech, consisting of 10,000 metres of
underground drilling on the South East Breccia Pipe Zone and 5,000 metres of surface drilling on the Krasta
target, to follow up on 2017 drilling. Drill programs at Krumovgrad include resource development drilling at
Surnak that is within the concession and scout drilling on nearby exploration licenses. A further 11,500
metres is planned for exploration and resource drilling at the Timok gold project in Serbia . The remaining
exploration budget will be deployed primarily to other greenfield projects in Bulgaria, Serbia and the Malartic
project in Quebec . Drill programs have commenced and were generally on schedule at the end of the
second quarter.
Qualified Person
The technical information in this press release, with respect to the Company’s material mineral projects,
has been prepared in accordance with Canadian regulatory requirements set out in National Instrument 43-
101 Standards of Disclosure for Minera l Projects (“NI 43 -101”) of the Canadian Securities Administrators
and the Canadian Institute of Mining, Metallurgy and Petroleum (“CIM”) Definition Standards for Mineral
8
Resources and Mineral Reserves, and has been reviewed and approved by Richard Gosse, M.Sc. (Mineral
Exploration), Senior Vice President, Exploration of DPM, who is a Qualified Person as defined under NI 43-
101, and not independent of the Company.
Second Quarter 2018 Results Call and Webcast (Listen/View only)
The Company will hold a call and webcast to discuss its second quarter results on Wednesday, August 1,
2018 at 9:00 a.m. EDT. The call will be hosted by Rick Howes, President and Chief Executive Officer, who
will be joined by Hume Kyle, Executive Vice President and Chief Financial Officer, together with other
members of the executive management team. The call will be accessible via a live webcast and by
telephone.
Date: Wednesday, August 1, 2018
Time: 9:00 am EDT
Webcast: https://edge.media-server.com/m6/p/3xxc3qbx
Canada and USA Toll Free: 1-844-264-2104
Outside Canada or USA: 1-270-823-1169
Replay: 1-855-859-2056
Replay Passcode: 6287927
About Dundee Precious Metals
Dundee Precious Metals Inc. is a Canadian based, international gold mining company engaged in the
acquisition of mineral properties, exploration, development, mining and processing of precious metals. The
Company's operating assets include the Chelopech operation, which produces a copper concentrate
containing gold and silver and a pyrite concentrate containing gold, located east of Sofia, Bulgaria; and the
Tsumeb smelter, a complex copper concentrate processing facility located in Namibia. DPM also holds
interests in a number of developing gold and exploration properties located in Bulgaria, including the
Krumovgrad gold project, whic h started construction in the fourth quarter of 2016 and is expected to
commence production in the fourth quarter of 2018, Canada, Serbia and Armenia, and its 10.2% interest in
Sabina Gold & Silver Corp.
CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS
This press release contains “forward looking statements” or “forward looking information” (collectively,
“Forward Looking Statements”) that involve a number of risks and uncertainties. Statements that constitute
Forward looking statements include, but are not limited to, certain statements with respect to the estimated
capital costs, key project operating costs and financial metrics and other project economics with respect to
Krumovgrad; the timing of development, permitting, construction, commissioning activities and
commencement of production in respect of Krumovgrad, timing of further optimization work at Tsumeb and
potential benefits of the planned rotary furnace installation; price of gold, copper, silver and acid, toll rates,
metals exposure and stockpile interest deductions ; the estimation of Mineral Reserves and Mineral
Resources and the realization of such mineral estimates ; the timing and amount of estimated future
production and output, life of mine, costs of production, cash costs and other c ost measures, capital
expenditures, rates of return at Krumovgrad and other deposits and timing of the development of new
deposits; results of economic studies; success of exploration activities ; success of permitting activities ,
permitting time lines ; currency fluctuations; requirements for additional capital ; government regulation of
mining and smelting operations; environmental risks ; reclamation expenses ; potential or anticipated
outcome of title disputes or claims; and timing and possible outcome of pending litigation. Forward Looking
Statements are statements that are not historical facts and are generally, but not always, identified by the
use of forward looking terminology such as “plans”, “expects”, or “does not expect”, “is expected”, “budget”,
“scheduled”, “estimates”, “forecasts”, “outlook”, “intends”, “anticipates”, or “does not anticipate”, or
“believes”, or variations of such words and phrases or that state that certain actions, events or results “may”,
“could”, “would”, “might” or “will” be taken, occur or be achieved. Forward Looking Statements are based
on certain key assumptions and the opinions and estimates of management and Qualified Persons (in the
case of technical and scientific information), as of the date such statements are made , and they involve
known and unknown risks, uncertainties and other factors which may cause the actual results, performance
or achievements of the Company to be materially different from any other future results, performance or