Jaguar Mining Reports Third Quarter 2017 Financial Results; Reports Increasing Operating and Free Cash Flow
NEWS RELEASE
November 7, 2017 TSX: JAG
FOR IMMEDIATE RELEASE
Jaguar Mining Reports Third Quarter 2017 Financial Results;
Reports Increasing Operating and Free Cash Flow
Toronto, Canada, November 7, 2017 – Jaguar Mining I nc. ("Jaguar" or the "Company") (TSX:JAG) today
announced details of the Company’s financial and op erating results for the third quarter ended
September 30, 2017 (“Q3 2017”). Complete Financial Statements and Management's Discussion and Analysis
are available on SEDAR and on the Company’s website at www.jaguarmining.com. All figures are in US dol lars,
unless otherwise expressed.
Q3 2017 Financial Highlights
● Focused efforts on delivering the highest profitab le ounce production and company-wide expense reduct ion
programs, despite strong Brazilian currency, have r esulted in decreasing cash operating costs (“COC”) to
$809 per ounce sold, a 6% reduction compared to $85 7 in Q2 2017 and a 12% reduction compared to $924
in Q1 2017.
● All in sustaining costs (“AISC”) decreased 7% to $ 1,169 per ounce sold compared to $1,262 per in Q2 2 017,
up compared to $1,011 during Q3 2016, reflecting increased exploration drilling programs in 2017.
● Significantly increased operating cash flow quarte r over quarter, to $7.5 million compared with $0.2 million
in Q2 2017, but was lower compared with $9.4 millio n in Q3 2016 mainly due to lower production.
● Sustaining capital expenditures of $4.6 million an d total capital expenditures of $5.8 for Q3 2017, c ompared
with $6.4 and $7.5 million respectively in Q3 2016. Total capital expenditures of $18.6 million year-t o-date to
the end of Q3 2017.
● Free cash flow turns positive for first time in 20 17 with $2.2 million in Q3 2017, based on operating cash
flow less sustaining capital expenditures, compared to $2.9 million in Q3 2016.
● Net loss of ($7.7 million), or ($0.02) per share r eflecting the impact of non-cash adjustments, prima rily the
impairment write-down on the sale of Jaguar’s non-c ore asset, Gurupi Project, and changes in some lega l
and tax provisions; this compares to net loss of ($31.6 million), or ($0.22) per share for Q3 2016.
● Ended the quarter with a strong cash balance of $1 9.2 million and stable adjusted working capital. In itial $2
million instalment received from Avanco for the Gur upi Project’s Accelerated Earn-in Agreement was use d
to make an additional $2 million payment towards reducing higher cost Brazilian bank debt.
Rodney Lamond, President and CEO of Jaguar, comment ed: "We continued to see improving performance
throughout Q3 2017 with a focus on generating the h ighest level of operating cash flow in 2017, throug h
profitable ounce production. Increased operating ca sh flow of $7.5 million in the third quarter allowe d the
company to continue to invest in sustaining capital , as committed, priority growth exploration program s and pay
down debt. Cost reduction initiatives combined with strong production results from Pilar contributed t o
significantly improved consolidated cash costs of $ 809 per ounce sold compared to the first half of 20 17 of
$895. In particular, Pilar and Roca Grande reduced cash costs 22% and 17%, respectively, in Q3 2017
compared to Q2 2017.”
“As of the end of Q3 2017, we have invested total c apital of approximately $19 million year to-date 20 17, with
$15.2 million invested in sustaining expenditures a nd exploration drilling that has yielded significan tly positive
results. Recent drill results at Pilar are extremel y encouraging and we are becoming increasingly conf ident in
the resource upside at Pilar which we expect to report with a mineral resource update in early 2018.”
“We ended the quarter with a solid cash balance of $19.2 million and repaid $5.2 million on our credit facilities
which included an additional $2 million of proceeds from an initial instalment of the Accelerated Earn -in
Agreement signed for the Gurupi Project. Moving for ward, our first priority will be to deliver profita ble ounce
production and generate higher operating cash flow that can be redeployed towards higher priority near -mine
sustaining and growth exploration projects, and paying down debt.”
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JAGUAR MINING INC.
First Canadian Place, 100 King Street West, 56 th Floor, Toronto, Ontario, Canada M5X 1C9 T: 416-847-1854
Corporate and Strategic Updates
● The Company continues to advance several initiativ es towards executing its growth strategy to become an
annual 200,000 ounce gold producer, while also cont inuing to restore and grow the production profile a t
Turmalina from its historic levels during 2016.
● Key growth exploration drilling programs completed to date at Pilar and Turmalina have generated exce llent
results are expected to support the sustainability of the core assets for future production. Pilar’s r ecent
strong performance and increased gold production de monstrates that the investments made over the last 12
months, to access the new higher-grade mining front s from the BF II orebody, were necessary to drive
increased production and also a key component of th e Company’s growth Strategy. The ounce per vertical
meter profile at Pilar is very encouraging and has reached over 2,000 ounces per vertical meter.
● The Company is currently exploring options and sol utions to an operating agreement as a first step ef fort to
resume operations at the Paciência gold mine. Paciê ncia mine produced 66,671 oz and 59,287 oz in 2009
and 2010 respectively before being placed on care a nd maintenance in Q3 2012. Once an acceptable
solution is found for the operating agreement, the company will begin a growth exploration drilling pr ogram
to explore the down plunge extension of the main de posits near the mine.
● The Company is also conducting reviews at the Roca Grande Gold Mine in an effort to solve the complex
issues due to a perched water table at the RG2 oreb ody. This orebody has delineated over 500,000 ounce s
in Mineral Resources but was abandoned in 2010 due to the water issues. The sizable mineral resource
was the reason the Caeté Plant was built and expand ed in 2010.
● The company continues to advance the two key growt h exploration programs at Pilar and Turmalina. Deep
drilling at Pilar has successfully confirmed (annou nced on September 20, 2017) the down plunge extensi on
of the main BFII and BF ore bodies. There are three growth exploration diamond drills working at Turma lina
drilling the down plunge extensions to Orebody A an d Orebody C and the company anticipates releasing
drilling results within the Q4 2017.
Appointment of New Board Director
The Company also announces the appointment of Ben G uenther to its Board of Directors as independent no n-
executive director. Mr. Guenther is a Mining Engin eer with a wide range of management and executive
experience and over 40 years in the global mining i ndustry. Mr. Guenther graduated from the Colorado S chool
of Mines. Mr. Guenther’s appointment as an independ ent Board member reflects the Company's commitment to
best practices in corporate governance.
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JAGUAR MINING INC.
First Canadian Place, 100 King Street West, 56 th Floor, Toronto, Ontario, Canada M5X 1C9 T: 416-847-1854
Financial and Operating Highlights
($ thousands, except where indicated)
For the three months ended
September 30,
For the nine months ended
September 30,
2017 2016 2017 2016
Financial Data
Revenue $ 26,062 $ 33,618 $ 78,606 $ 90,278
Operating costs 16,116 16,191 53,614 51,657
Depreciation 5,898 9,509 17,271 25,599
Gross profit 4,048 7,918 7,721 13,022
Gross profit (excluding depreciation) 1 9,946 17,427 24,992 38,621
Loss on change in fair value of notes payable - 31,672 - 77,616
Net loss (7,664) (31,648) (18,861) (73,515)
Per share ("EPS") (0.02) (0.22) (0.06) (0.60)
EBITDA 1 (507) (17,802) 3,949 (41,710)
Adjusted EBITDA 1,2 6,094 14,394 14,020 30,299
Adjusted EBITDA per share 1 0.02 0.10 0.04 0.25
Cash operating costs (per ounce sold) 1 809 645 867 713
All-in sustaining costs (per ounce sold) 1 1,168 1,011 1,249 1,092
Average realized gold price (per ounce)¹ 1,276 1,328 1,250 1,251
Cash generated from operating activities 7,509 9,353 9,583 29,314
Adjusted operating cash flow 1 6,076 11,275 15,002 23,289
Free cash flow 1 2,212 2,972 (7,118) 9,055
Free cash flow (per ounce sold) 1 108 117 (113) 125
Sustaining capital expenditures 1 4,624 6,370 15,233 19,246
Non-sustaining capital expenditures 1 1,138 1,152 3,401 2,781
Total capital expenditures 5,763 7,522 18,634 22,027
1 Average realized gold price, sustaining and non-sustaining capital expenditures, cash operating costs and all-in sustaining costs, adjusted operating cash
flow, free cash flow, EBITDA and adjusted EBITDA, adjusted EBITDA per share, and gross profit (excluding depreciation) are non-IFRS financial
performance measures with no standard definition under IFRS. Refer to the Non-IFRS Financial Performance Measures section of the MD&A.
2 Adjusted EBITDA excludes non -cash items such as impairment and write downs. For more details refer to the Non -IFRS Performance Measures section
of the MD&A.
For the three months ended
September 30,
For the nine months ended
September 30,
2017 2016 2017 2016
Operating Data
Gold produced (ounces) 20,781 25,782 62,842 71,201
Gold sold (ounces) 20,422 25,316 62,909 72,167
Primary development (metres) 932 1,353 2,666 4,371
Secondary development (metres) 922 1,182 3,292 3,545
Definition, infill, and exploration drilling (metres) 11,592 6,749 34,525 28,126
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JAGUAR MINING INC.
First Canadian Place, 100 King Street West, 56 th Floor, Toronto, Ontario, Canada M5X 1C9 T: 416-847-1854
Liquidity Position and Working Capital
● As at September 30, 2017, the Company had a cash b alance of $19.2M, compared to a cash balance of
$20.7 million at June 30, 2017.
● During the third quarter, the Company received $2M from Avanco for the first instalment of the Accele rated
Earn-in Agreement signed for the Gurupi Project on September 18, 2017. In addition to the regular
repayments of financing obligations of $3.2M during the quarter, the Company used the initial proceeds
from the Gurupi Avanco transaction to make an addit ional debt repayment of $2M for part of the high co st
Brazilian debt, thus reducing the future debt servicing.
● Subsequent to the quarter end, the Company closed the sale of the Gurupi transaction with Avanco
Resources. On closing the transaction, the Company received an additional $2 million and recorded an
impairment (non-cash) write down of $5.1 million on the asset, leading to a net loss for the quarter.
● Significantly improved working capital quarter ove r quarter. As September 30, 2017, working capital w as
$28.2 million compared to $11.3 million as at Decem ber 31, 2016 mainly due to a temporary reclassifica tion
of Gurupi asset as Asset Held for Sale as part of c urrent assets. Working capital includes $6.0 millio n of
short term payable loan to Brazilian banks which ma ture every six months and are expected to continue to
be rolled forward. Adjusted Working Capital (exclud ing the temporary reclassification of Gurupi asset as
held for sale) was $6 million. With the closing of the Gurupi earn-in transaction that occurred in Q4 2017, an
additional $5-6 million is expected to be added to the Adjusted Working Capital.
Quarterly Operating Summary
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JAGUAR MINING INC.
First Canadian Place, 100 King Street West, 56 th Floor, Toronto, Ontario, Canada M5X 1C9 T: 416-847-1854
Q3 2017 Operational Update
● Consolidated gold production decreased 19% to 20,7 81 ounces in Q3 2017 compared to 25,783 ounces in
Q3 2016. Consolidated gold production for YTD 2017 was 62,842 ounces compared to 71,202 ounces in
the first nine months of 2016.
o Pilar production of 9,674 ounces in Q3 2017 compar ed to 7,923 ounces produced in Q3 2016;
production improvements in the later part of the qu arter started to reflect the advancing ore
development into the higher-grade Orebodies BF II and BF.
o Turmalina produced 9,674 ounces in Q3 2017 compare d to 16,304 ounces in Q3 2016; however, with
the mining issues encountered at level 9 during Q1 and Q2 2017, the Company is completing the review
of the upper levels of the mine in Orebody A to ide ntify areas of high-grade blocks that can be
recovered. Several areas have already been identifi ed and two mining blocks within these areas are
expected to be recovered by year-end.
● The Company completed 932 metres and 2,666 metres of primary development during the three and nine
months ended September 30, 2017, respectively, comp ared to 1,353 metres and 4,371 metres in the
comparative 2016 periods.
● Ore processed was 212,000 tonnes in Q3 2017 (Q3 20 16 – 231,000 tonnes) at an average head grade of
3.36 g/t (Q3 2016 – 3.83 g/t).
o In Q3 2017, Turmalina processed 107,000 tonnes (Q3 2016 – 128,000 tonnes) at an average head
grade of 3.10 g/t (Q3 2016 – 4.36 g/t). Increasing gold production from Orebody C, while the mining
cycle is normalized in Orebody A and until access t o lower Orebody C containing higher grades can be
established, is expected to continue to impact consolidated grade in the short term.
o Caeté plant processed 105,000 tonnes in Q3 2017 (Q 3 2016 – 103,000 tonnes) at an average head
grade of 3.62 g/t (Q3 2016 – 3.17 g/t).
o New record grade at Pilar Gold Mine (“Pilar”) of 3 .77 g/t Au for the quarter as mining activity incre ased
into the higher-grade BFII ore body, resulting in 9 ,674 ounces of gold produced in Q3 2017, an increas e
of 26% quarter over quarter. September gold grade f or Pilar was 4.48 g/t Au. The higher average head
grade and lower tonnage reduced consolidated Cash O perating Costs (“COC”) per ounce sold in Q3
2017.
o Increasing grade at Roça Grande Mine (“Roça Grande ”) of 2.88 g/t Au contributed to gold production of
1,491 ounces, which was 25% higher compared to Q2 2 017. Improved performance and operational
efficiencies, including optimization of working shi fts, resulted in positive operational cash flows fo r Roça
Grande.
● Total production for YTD 2017 was 643,000 tonnes ( average head grade of 3.35 g/t), as compared to
644,000 tonnes processed in the first nine months of 2016 (average head grade of 3.79 g/t).
Qualified Person
Scientific and technical information contained in t his press release has been reviewed and approved by
Jonathan Victor Hill, BSc (Hons) (Economic Geology - UCT), Senior Expert Advisor Geology and Explorati on to
the Jaguar Mining Management Committee, who is also an employee of Jaguar Mining Inc., and is a “quali fied
person” as defined by National Instrument 43-101 - Standards of Disclosure for Mineral Projects (“NI 43-101”).
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JAGUAR MINING INC.
First Canadian Place, 100 King Street West, 56 th Floor, Toronto, Ontario, Canada M5X 1C9 T: 416-847-1854
The Iron Quadrangle
The Iron Quadrangle has been an area of mineral exp loration dating back to the 16th century. The disco very in
1699-1701 of black gold contaminated with iron and platinum-group metals in the southeastern corner of the
Iron Quadrangle gave rise to the name of the town O uroPreto (Black Gold). The Iron Quadrangle contains
world-class multi-million-ounce gold deposits such as Morro Velho, Cuiabá and São Bento. Jaguar holds the
second largest gold land position in the Iron Quadrangle with just over 25,000 hectares.
About Jaguar Mining Inc.
Jaguar Mining Inc. is a Canadian-listed junior gold mining, development, and exploration company opera ting in
Brazil with three gold mining complexes and a large land package with significant upside exploration p otential
from mineral claims covering an area of approximate ly 64,000 hectares. The Company’s principal operati ng
assets are located in the Iron Quadrangle, a prolif ic greenstone belt in the state of Minas Gerais and include the
Turmalina Gold Mine Complex and Caeté Mining Comple x (Pilar and Roça Grande Mines, and Caeté Plant).
The Company also owns the Paciência Gold Mine Compl ex, which has been on care and maintenance since
2012. Additional information is available on the Company's website at www.jaguarmining.com.
For further information please contact:
Rodney Lamond
President & Chief Executive Officer
Jaguar Mining Inc.
416-847-1854
Hashim Ahmed
Chief Financial Officer
Jaguar Mining Inc.
416-847-1854
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JAGUAR MINING INC.
First Canadian Place, 100 King Street West, 56 th Floor, Toronto, Ontario, Canada M5X 1C9 T: 416-847-1854
Forward-Looking Statements
Certain statements in this news release constitute "forward-looking information" within the meaning of applicable
Canadian securities legislation. Forward-looking st atements and information are provided for the purpo se of
providing information about management's expectatio ns and plans relating to the future. All of the for ward-
looking information made in this news release is qu alified by the cautionary statements below and thos e made
in our other filings with the securities regulators in Canada.Forward-looking information contained in forward-
looking statements can be identified by the use of words such as "are expected," "is forecast," "is ta rgeted,"
"approximately," "plans," "anticipates," "projects, " "anticipates," "continue," "estimate," "believe" or variations of
such words and phrases or statements that certain a ctions, events or results "may," "could," "would," "might," or
"will" be taken, occur or be achieved. All statemen ts, other than statements of historical fact, may b e considered
to be or include forward looking information. This news release contains forward-looking information r egarding,
among other things, expected sales, production stat istics, ore grades, tonnes milled, recovery rates, cash
operating costs, definition/delineation drilling, t he timing and amount of estimated future production , costs of
production, capital expenditures, costs and timing of the development of projects and new deposits, su ccess of
exploration, development and mining activities, cur rency fluctuations, capital requirements, project s tudies, mine
life extensions, restarting suspended or disrupted operations, continuous improvement initiatives, and resolution
of pending litigation. The Company has made numerou s assumptions with respect to forward-looking
information contained herein, including, among othe r things, assumptions about the estimated timeline for the
development of its mineral properties; the supply a nd demand for, and the level and volatility of the price of,
gold; the accuracy of reserve and resource estimate s and the assumptions on which the reserve and reso urce
estimates are based; the receipt of necessary permi ts; market competition; ongoing relations with empl oyees
and impacted communities; political and legal devel opments in any jurisdiction in which the Company op erates
being consistent with its current expectations incl uding, without limitation, the impact of any potent ial power
rationing, tailings facility regulation, exploratio n and mine operating licenses and permits being obt ained an
renewed and/or there being adverse amendments to mi ning or other laws in Brazil and any changes to gen eral
business and economic conditions. Forward-looking i nformation involve a number of known and unknown ri sks
and uncertainties, including among others: the risk of Jaguar not meeting the forecast plans regarding its
operations and financial performance; uncertainties with respect to the price of gold, labour disrupti ons,
mechanical failures, increase in costs, environment al compliance and change in environmental legislati on and
regulation, weather delays and increased costs or p roduction delays due to natural disasters, power di sruptions,
procurement and delivery of parts and supplies to t he operations; uncertainties inherent to capital ma rkets in
general (including the sometimes volatile valuation of securities and an uncertain ability to raise ne w capital)
and other risks inherent to the gold exploration, d evelopment and production industry, which, if incor rect, may
cause actual results to differ materially from thos e anticipated by the Company and described herein. In
addition, there are risks and hazards associated wi th the business of gold exploration, development, m ining and
production, including environmental hazards, tailin gs dam failures, industrial accidents and workplace safety
problems, unusual or unexpected geological formatio ns, pressures, cave-ins, flooding, chemical spills,
procurement fraud and gold bullion thefts and losse s (and the risk of inadequate insurance, or the ina bility to
obtain insurance, to cover these risks). Accordingl y, readers should not place undue reliance on forwa rd-looking
information.
For additional information with respect to these an d other factors and assumptions underlying the forw ard-
looking information made in this news release, see the Company's most recent Annual Information Form a nd
Management's Discussion and Analysis, as well as ot her public disclosure documents that can be accesse d
under the issuer profile of "Jaguar Mining Inc." on SEDAR at www.sedar.com. The forward-looking inform ation
set forth herein reflects the Company's reasonable expectations as at the date of this news release an d is
subject to change after such date. The Company disc laims any intention or obligation to update or revi se any
forward-looking information, whether as a result of new information, future events or otherwise, other than as
required by law. The forward-looking information co ntained in this news release is expressly qualified by this
cautionary statement.
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JAGUAR MINING INC.
First Canadian Place, 100 King Street West, 56 th Floor, Toronto, Ontario, Canada M5X 1C9 T: 416-847-1854
Non-IFRS Measures
This news release provides certain financial measur es that do not have a standardized meaning prescrib ed by
IFRS. Readers are cautioned to review the above sta ted footnotes where the Company expanded on its use of
non-IFRS measures.
1. Cash operating costs and cash operating cost per ou nce are non-IFRS measures. In the gold mining
industry, cash operating costs and cash operating c osts per ounce are common performance measures but
do not have any standardized meaning. Cash operatin g costs are derived from amounts included in the
Consolidated Statements of Comprehensive Income (Lo ss) and include mine-site operating costs such as
mining, processing and administration, as well as r oyalty expenses, but exclude depreciation, depletio n,
share-based payment expenses, and reclamation costs . Cash operating costs per ounce are based on
ounces produced and are calculated by dividing cash operating costs by commercial gold ounces produced ;
US$ cash operating costs per ounce produced are der ived from the cash operating costs per ounce
produced translated using the average Brazilian Cen tral Bank R$/US$ exchange rate. The Company
discloses cash operating costs and cash operating c osts per ounce, as it believes those measures provi de
valuable assistance to investors and analysts in ev aluating the Company's operational performance and
ability to generate cash flow. The most directly co mparable measure prepared in accordance with IFRS i s
total production costs. A reconciliation of cash op erating costs per ounce to total production costs f or the
most recent reporting period, the quarter ended Sep tember 30, 2017, is set out in the Company's third
quarter 2017 Management Discussion and Analysis (MD &A) filed on SEDAR at www.sedar.com.
2. All-in sustaining cost is a non-IFRS measure. This measure is intended to assist readers in evaluating the
total costs of producing gold from current operatio ns. While there is no standardized meaning across t he
industry for this measure, except for non-cash item s the Company's definition conforms to the all-in
sustaining cost definition as set out by the World Gold Council in its guidance note dated June 27, 20 13.
The Company defines all-in sustaining cost as the s um of production costs, sustaining capital (capital
required to maintain current operations at existing levels), corporate general and administrative expe nses,
and in-mine exploration expenses. All-in sustaining cost excludes growth capital, reclamation cost acc retion
related to current operations, interest and other f inancing costs, and taxes. A reconciliation of all- in
sustaining cost to total production costs for the m ost recent reporting period, the quarter ended Sept ember
30, 2017 is set out in the Company's third quarter 2017 MD&A filed on SEDAR at www.sedar.com.