GoGold Reports Net Income of $43.1M US for Year Ending
GoGold Reports Net Income of $43.1M US for Year Ending
September 30, 2020
Shares Outstanding: 264,429,288
Trading Symbols: TSX: GGD
OTCQX: GLGDF
HALIFAX, NS,
Dec. 17, 2020
/CNW/ -
GoGold Resources Inc.
(TSX: GGD) (OTCQX: GLGDF)
("GoGold", "the Company")
is pleased
to announce the release of financial results for the quarter and year ending
September 30, 2020
with record annual revenue of
$39.5
million
(all amounts are in U.S. dollars) from the sale of 2.2 million silver equivalent ounces which provided cash flow from operations
before working capital changes of
$8.7 million
.
"Parral had a record production year and a record quarter which generated
$6.5 million
US of cash flow, paying for all of our exploration
and general and administrative costs. We have one of the largest drilling programs in
Mexico
and we are currently self funding from
operations at Parral. Parral had an excellent year which resulted in a reversal of a previously recorded impairment of
$41.1 million
, which
really reflects on how strongly that asset is performing now,"
Brad Langille
, President and CEO stated. "With our
$52.7 million
US cash
balance and the cash flow from our Parral operation, we are well positioned to continue the rapid advancement of the Los Ricos district."
Financial Highlights for the year ending
September 30, 2020
:
Cash flow from operations before working capital changes of
$8.7 million
, including free cash flow from Parral of
$12.6 million
Net income of
$43.1 million
(
$0.21
per share)
Record revenue of
$39.5 million
, an increase of 46%, on the sale of 2.2 million silver equivalent ounces at a realized price per ounce
of
$18.00
Cash of
$52.7 million
All in sustaining costs of
$14.82
per silver equivalent ounce
Cash costs of
$12.24
per silver equivalent ounce
At Parral, the project generated
$39.5 million
on sales of 2.2 million silver equivalent ounces for the year ended
September 30, 2020
,
which is an increase of 46% compared to the prior year's
$27.0 million
, while costs were similar. All in sustaining costs ("AISC") were
$14.72
per ounce and cash costs were
$12.24
in 2020, compared to AISC of
$14.82
and cash costs of
$11.80
in 2019.
With the strength of Parral's operations in the year, at
September 30
the Company recorded a non-cash reversal of impairment of
$41.1
million
, which was recorded through net income. The Company determined that increased positive cash flows, operational performance,
and an increase in metal prices at the Parral project constituted indicators that a previously recorded impairment of
$48.2 million
on
September 30, 2018
at Parral no longer existed, with the difference attributed to depreciation which would have been recorded had the
initial impairment not been recorded.
At Los Ricos, the Company capitalized
$8.3 million
to the projects for drilling, exploration and consulting for the year ending
September
30, 2020
, compared to
$1.8 million
in the prior year. This included
$5.5 million
at Los Ricos South and
$2.8 million
at Los Ricos North.
During the year, GoGold drilled 36,100 metres, released assay results for 194 drill holes, and released an initial Mineral Resource
estimate at Los Ricos South. The Measured & Indicated Mineral Resource at Los Ricos South includes 63.7 million ounces silver
equivalent ("AgEq") grading 199 g/t AgEq contained in 10.0 million tonnes ("Mt"), with an Inferred Resource of of 19.9 million ounces AgEq
grading 190 g/t AgEq contained in 3.3 Mt.
Financial Highlights for the quarter ending
September 30, 2020
:
Cash flow from operations before changes in working capital of
$5.5 million
, including free cash flow from Parral of
$6.5 million
Net income of
$44.6 million
(
$0.21
per share)
Revenue of
$13.8 million
on the sale of 605,723 silver equivalent ounces at a realized price per ounce of
$22.71
All in sustaining costs of
$14.31
per silver equivalent ounce
Cash costs of
$11.97
per silver equivalent ounce
Following are tables showing summarized financial information and key performance indicators:
Summarized Consolidated Financial Information
Three months ended Sep 30
Year ended Sep 30
(in thousands USD, except per share amounts)
2020
2019
2020
2019
Revenue
$ 13,756
$ 9,709
$ 39,548
$ 26,972
Cost of sales, including depreciation
8,201
8,505
30,597
26,682
Operating income (loss)
4,225
4
3,952
(4,410)
Net income
44,604
751
43,148
8,114
Basic net income per share
0.206
0.004
0.206
0.048
Cash flow from operations before changes in working capital
5,473
1,959
8,749
2,974
Key Performance Indicators
1
Three months ended Sep 30
Year ended Sep 30
(in thousands USD, except per ounce amounts)
2020
2019
2020
2019
Total tonnes stacked
417,803
300,263
1,398,633
1,654,393
Silver equivalent ounces sold
605,723
572,435
2,197,579
1,758,307
AISC per silver equivalent ounce
2
$ 14.31
$ 13.78
$ 14.72
$ 14.82
Cash cost per silver equivalent ounce
2
$ 11.97
$ 11.62
$ 12.24
$ 11.80
Realized silver price
$ 22.71
$ 16.96
$ 18.00
$ 15.34
1
Key performance indicators are unaudited non-GAAP measures
2
Gold and copper are converted using average market prices
This news release should be read in conjunction with the consolidated financial statements for the year ended
September 30, 2020
, notes
to the financial statements, and management's discussion and analysis for the year ended
September 30, 2020
, which have been filed on
SEDAR and are available on the Company's website.
Technical information contained in this news release with respect to GoGold has been reviewed and approved by Mr.
Bob Harris
, P.Eng.,
who is a qualified person for the purposes of NI 43-101.
CAUTIONARY STATEMENT:
The securities described herein have not been, and will not be, registered under the United States Securities Act of 1933, as amended
(the "U.S. Securities Act"), or any state securities laws, and may not be offered or sold within
the United States
or to, or for the benefit of,
U.S. persons (as defined in Regulation S under the U.S. Securities Act) except in compliance with the registration requirements of the U.S.
Securities Act and applicable state securities laws or pursuant to exemptions therefrom. This release does not constitute an offer to sell
or a solicitation of an offer to buy of any of GoGold's securities in
the United States
.
This news release may contain "forward-looking information" as defined in applicable Canadian securities legislation. All statements other
than statements of historical fact, included in this release, including, without limitation, statements regarding the Parral tailings project, the
Los Ricos project, future operating margins, future production and processing, and future plans and objectives of GoGold, constitute
forward looking information that involve various risks and uncertainties. Forward-looking information is based on a number of factors and
assumptions which have been used to develop such information but which may prove to be incorrect, including, but not limited to,
assumptions in connection with the continuance of GoGold and its subsidiaries as a going concern, general economic and market
conditions, mineral prices, the accuracy of mineral resource estimates, and the performance of the Parral project There can be no
assurance that such information will prove to be accurate and actual results and future events could differ materially from those
anticipated in such forward-looking information.
Important factors that could cause actual results to differ materially from GoGold's expectations include exploration and development risks
associated with the GoGold's projects, the failure to establish estimated mineral resources or mineral reserves, volatility of commodity
prices, variations of recovery rates, the effects of the global COVID-19 pandemic, and global economic conditions. For additional
information with respect to risk factors applicable to GoGold, reference should be made to GoGold's continuous disclosure materials filed
from time to time with securities regulators, including, but not limited to, GoGold's Annual Information Form. The forward-looking
information contained in this release is made as of the date of this release.
Cautionary non-GAAP Measures and Additional GAAP Measures
Note that for purposes of this section, GAAP refers to IFRS. The Company believes that investors use certain non-GAAP and additional
GAAP measures as indicators to assess mining companies. They are intended to provide additional information and should not be
considered in isolation or as a substitute for measures of performance prepared with GAAP. Non-GAAP and additional GAAP measures
do not have a standardized meaning prescribed under IFRS and therefore may not be comparable to similar measures presented by other
companies.
Additional GAAP measures that are presented on the face of the Company's consolidated statements of comprehensive income include
"Operating income (loss)". These measures are intended to provide an indication of the Company's mine and operating performance.
"Cash flow from operating activities before changes in non-cash working capital" is a non-GAAP performance measure that could provide
an indication of the Company's ability to generate cash flows from operations, and is calculated by adding back the change in non-cash
working capital to "Net cash used in operating activities" as presented on the Company's consolidated statements of cash flows. Per
ounce measures are calculated by dividing the relevant mining and processing costs and total costs by the tonnes of ore processed in the
period. "Cash costs per ounce" and "all-in sustaining costs per ounce" as used in this analysis are non-GAAP terms typically used by
mining companies to assess the level of gross margin available to the Company by subtracting these costs from the unit price realized
during the period. These non-GAAP terms are also used to assess the ability of a mining company to generate cash flow from operations.
There may be some variation in the method of computation of these metrics as determined by the Company compared with other mining
companies. In this context, "cash costs per ounce" reflects the cash operating costs allocated from in-process and dore inventory
associated with ounces of silver and gold sold in the period. "Cash costs per ounce" may vary from one period to another due to operating
efficiencies, grade of material processed and silver/gold recovery rates in the period. "All-in sustaining costs per ounce" include total cash
costs, exploration, corporate and administrative, share based compensation and sustaining capital costs. For a reconciliation of non-
GAAP and GAAP measures, please refer to the Management Discussion and Analysis dated
December 16, 2020
, for the year ended
September 30, 2020
, as presented on SEDAR.
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SOURCE
GoGold Resources Inc.
View original content:
http://www.newswire.ca/en/releases/archive/December2020/17/c8167.html
%SEDAR: 00029249E
For further information:
Steve Low, Corporate Development, GoGold Resources Inc., T: 416 855 0435, Email :
[email protected] or visit : www.gogoldresources.com
CO: GoGold Resources Inc.
CNW 08:00e 17-DEC-20