BVC: MINEROS 1 Mineros Reports First Quarter 2023 Financial and Operational Results (all amounts other than per share amounts expressed in thousands of U.S. dollars
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BVC: MINEROS
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Mineros Reports First Quarter 2023 Financial and Operational Results
(all amounts other than per share amounts expressed in thousands of U.S. dollars unless otherwise stated)
Medellin, Colombia – May 8, 2023 – Mineros S.A. (TSX:MSA, MINEROS:CB) (“ Mineros” or the “ Company”)
today reported its financial and operational results for the three months ended March 31, 2023. For further
information, please see the Company’s unaudited condensed consolidated interim financial statements and
management’s discussion and analysis (“MD&A”) filed under its profile on www.sedar.com.
Andrés Restrepo, President and CEO of Mineros, commented, “The first quarter of 2023 was challenging as we
faced a nearly two-week long suspension of operations at the Nechí Alluvial Property, due to protests by groups
of informal miners, which reflected as a 9% decrease in gold produced when compared to the same quarter of
2022. On the other hand, during the first quarter of 2023, we also received the positive pre-feasibility study
results for the Porvenir Project in Nicaragua, a key project in our pipeline of organic growth projects. The
Porvenir Project would allow us to extend the life of mine at the Hemco Property for eight additional years,
adding average annual production of approximately 56,700 ounces of gold. We expect that brownfield and
greenfield exploration of our properties will remain a source of future growth”.
FINANCIAL AND OPERATING HIGHLIGHTS FOR THE FIRST QUARTER 2023
Gold Production
• 60,248 ounces of gold produced.
• A 9% decrease in gold production compared to the same period in 2022 (Q1/22: 66,009 ounces of gold
produced).
• On track to achieve 2023 production guidance.
Cost of Sales, Cash Cost1 and All-in Sustaining Cost (“AISC”)1
• Cost of sales of $85,820, a decrease of 7% relative to the same period in 2022 (Q1/22: $92,005).
• Cash Cost per ounce of gold sold1,2 of $1,155 (Q1/22: $1,175), representing a 2% decrease relative to
the same period in 2022.
• AISC per ounce of gold sold1,2 of $1,411 (Q1/22: $1,377), representing an 2% increase relative to the
same period in 2022.
• On track to achieve 2023 cost guidance.
1 Cash Cost, AISC, Adjusted EBITDA, net free cash flow and average price realized per ounce of gold sold are non-IFRS financial measures,
and Cash Cost per ounce of gold sold (stated in dollars), AISC per ounce of gold sold, ROCE and Net Debt to Adjusted EBITDA ratio are non-
IFRS ratios, with no standardized meaning under IFRS, and therefore they may not be comparable to similar measures presented by other
issuers. For further information and detailed reconciliations of non-IFRS financial measures to the most directly comparable IFRS measures,
see Non-IFRS and Other Financial Measures in this news release.
2 Stated in dollars.
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Dividend Payment
• $4,837 in dividends paid.
• An increase of 5% in dividends paid compared to the same period in 2022 (Q1/22: $4,598).
Revenue
• Revenue of $118,090.
• Revenue decreased by 5% compared to the same period in 2022 (Q1/22: $124,650).
Profitability
• Gross profit decreased by 1% to $32,270 compared to the same period in 2022 (Q1/22: $32,645).
• Net profit for the period up 47% to $15,404 ($0.05/share) compared to the same period in 2022 (Q1/22:
$10,472 or ($0.03/share)), explained by the insurance claim recognition associated with the
overturning of the Llanuras Plant, a floating beneficiation plant at the Nechí Alluvial Property on May
28, 2022.
Net Debt to Adjusted EBITDA ratio1
• Net Debt to Adjusted EBITDA ratio1 of 0.07x as at March 31, 2023.
• The Company has continued to have a low Net Debt to Adjusted EBITDA ratio, even with a 256%
increase compared to 0.02x as at March 31, 2022.
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Financial and Operating Highlights.
Three Months Ended
March 31, Change
2023 2022 $ %
Financial
Revenue 118,090 124,650 (6,560) (5)%
Cost of sales (85,820) (92,005) (6,185) (7)%
Gross Profit 32,270 32,645 (375) (1)%
Net Profit For The Period 15,404 10,472 4,932 47%
Basic and diluted earnings per share ($) $0.05 $0.03 $0.02 47%
Adjusted EBITDA 1 40,603 41,147 (544) (1)%
Net cash flows generated by operating
activities 2,498 5,303 (2,805) (53)%
Net free cash flow 1 (12,675) (5,779) (6,896) 119%
ROCE 1 28% 22% (10%) (45)%
Net Debt to Adjusted EBITDA ratio1 0.07x 0.02x 0.05x 256%
Dividends paid 4,837 4,598 239 5%
Operating
Average realized price per ounce of gold
sold ($/oz) 1,884 1,884 1 0%
Total Gold Produced (oz) 60,248 66,009 (5,761) (9)%
Gold sold (oz) 60,693 64,537 (3,844) (6)%
Silver sold (oz) 134,669 101,473 33,196 33%
Cash Cost per ounce of gold sold ($/oz) 1 $1,155 $1,175 $(20) (2)%
AISC per ounce of gold sold ($/oz) 1 $1,411 $1,377 $33 2%
1. Average realized price per ounce of gold sold, Adjusted EBITDA, and net free cash flow are Non-IFRS financial measures, and ROCE
and Net Debt to Adjusted EBITDA ratio are Non-IFRS ratios, with no standardized meaning under IFRS, and therefore may not be
comparable to similar measures presented by other issuers. For further information and detailed reconciliations to the most directly
comparable IFRS measures, see Non-IFRS And Other Financial Measures in this news release.
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Operational Highlights by Material Property
(All numbers in ounces unless otherwise noted)
Three Months Ended
March 31, Change
2023 2022 ounces %
Nechí Alluvial Property (Colombia) 17,988 19,285 (1,297) (7)%
Hemco Property 10,221 9,123 1,098 12%
Artisanal Mining 22,400 23,438 (1,038) (4)%
Nicaragua 32,621 32,561 60 —%
Gualcamayo Property (Argentina) 9,639 14,163 (4,524) (32)%
Total Gold Produced 60,248 66,009 (5,761) (9)%
Total Silver Produced 134,669 101,473 33,196 33%
Production of 17,988 ounces of gold during the first quarter of 2023 from the Nechí Alluvial Property in Colombia
was 7% below production during the first quarter of 2022 production, explained by a nearly two-week long
suspension of operations due to protests in the Bajo Cauca region.
In Nicaragua, gold production during the first quarter of 2023 was 32,621 ounces of gold, similar to production
of the first quarter of 2022, as higher production from the Panama and Pioneer mines in the first quarter of 2023
compensated for lower purchases of artisanal material.
First quarter of 2023 production of 9,639 ounces of gold from the Gualcamayo Property in Argentina was 32%
lower than production during the first quarter of 2022, explained mainly by a lower average gold grade by 50%.
The increase in ore-in-process stockpiles is explained by lower production levels due to the cyanidation process
and heap leach kinetics.
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CORPORATE HIGHLIGHTS FOR THE THREE MONTHS ENDED MARCH 31, 2023
Positive Prefeasibility Study Results for the Porvenir Project - Hemco Property, Nicaragua
On March 16, 2023, the Company announced a new technical report on the Hemco Property, which included
positive prefeasibility study results for its Porvenir Project updated Mineral Resource and Mineral Reserve
estimates for other deposits, significantly increasing the mine life of the Hemco Property Mineral Reserves from
five to thirteen years. Highlights of the prefeasibility study included:
• Mineral Resource and Mineral Reserve estimates for the Porvenir Project, effective December 31,
2022:
◦ 270 kt of Proven Mineral Reserves averaging 2.70 g/t Au, 13.6 g/t Ag and 3.14% Zn,
containing 23 koz Au, 118 koz Ag, and 19 Mlb Zn;
◦ 5,524 kt of Probable Mineral Reserves averaging 3.09 g/t Au, 10.2 g/t Ag and 2.96% Zn,
containing 549 koz Au, 1,804 koz Ag, and 360 Mlb Zn;
◦ 59 kt of Measured Mineral Resources averaging 1.75 g/t Au, 8.08 g/t Ag, and 2.11 % Zn,
containing 3 koz Au, 15 koz Ag, and 3 Mlb Zn;
◦ 974 kt of Indicated Mineral Resources averaging 2.39 g/t Au, 8.13 g/t Ag, and 2.56% Zn
containing metal of 75 koz Au, 255 koz Ag, and 55 Mlb Zn; and
◦ 1,694 kt of Inferred Mineral Resources averaging 2.42 g/t Au, 12.10 g/t Ag, and 3.64% Zn,
containing metal of 132 koz Au, 656 koz Ag, and 136 Mlb Zn.
• Porvenir Project base case economics include an after-tax net present value (using a 10% discount
rate) of approximately $42 million, which is 27% of current market capitalisation (close to $155
million) an after-tax internal rate of return (“IRR”) of approximately 16% and a payback period of
approximately 4 years from start of production in 2027, assuming $1,500/oz Au, $19.00/oz Ag, and
$1.27/lb Zn.
• The Porvenir Project will add average annual production over its nine-year mine life of 56,700 oz
Au per year, along with 112,300 oz Ag per year and 38.5 Mlb Zn per year to the Hemco Property.
• After-tax net present value (using a 5% discount rate) of $160 million, similar to current market
capitalisation of CAD 200 million (close to $155 million) at $1,650/oz Au, $20.90/oz Ag, and $1.40/lb
Zn; increasing to $216mm at $1,800/oz Au, $22.80/oz Ag, and $1.52/lb Zn.
• IRR of 21% and after-tax payback period of 3.5-years from start of production at $1,650/oz Au,
$20.90/oz Ag, and $1.40/lb Zn.
For more information, see the MD&A.
Temporary Suspension of Operations at the Nechí Alluvial Property in Colombia due to Protests
On March 10, 2023, the Company announced a temporary suspension of operations at its Nechí Alluvial
Property due to protests by groups of informal miners not associated with the Company against measures taken
by the national government of Colombia. On March 23, 2023, the Company announced the resumption of all
temporarily suspended operations. While the suspension negatively impacted the Company’s quarterly gold
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production, Mineros nevertheless expects to reach its annual production guidance for the Nechí Alluvial Property
of 84,000 – 94,000 oz. The Company continues to work with local communities and stakeholders to ensure the
continuity of its operations at its Nechí Alluvial Property.
Profit Distribution and 2023 Dividends
On March 30, 2023, at the Company’s ordinary meeting of its General Shareholders Assembly, a distribution of
the Company’s profits for the year was approved. This distribution included, in respect of each common share
of the Company, an annual ordinary dividend of payable in four equal quarterly installments of $0.0175,
representing a total distribution of $0.07 per share, or $20,982 in total.
Subsequent to March 31, 2022
Reduction of Royal Road Interest in Hemco Property
On April 13, 2023, Royal Road Minerals Limited (“Royal Road”) abandoned its rights under the amended and
restated strategic alliance agreement dated May 21, 2021, between Hemco Nicaragua S.A., a subsidiary of
Mineros, and Royal Road and its Nicaraguan affiliate in respect of the Hemco Property, except the Hemco Rosita
VI concession and the Hemco Rosita VII concession application, which together form the Caribe Exploration
Target. The Company does not expect this reduction to have a material impact on its financial statements.
GROWTH AND EXPLORATION PROJECT UPDATES
Porvenir Project, Nicaragua: After obtaining positive pre-feasibility study results, t he Company is planning to
drill a total of 5,000 metres of diamond drilling at the Porvenir Project starting in the second quarter of 2023,
with the aim of increasing or upgrading current Mineral Resources and Mineral Reserves.
Luna Roja Deposit, Nicaragua : In the first quarter of 2023, upon review of its exploration priorities, the
Company determined to focus its resources on reviewing the Luna Roja geological model, interpreting the
results of its 2022 drilling campaign, including new targets surrounding the main deposit, and internally updating
its Mineral Resource estimate prior to commencing further drilling at the Luna Roja Deposit.
Deep Carbonates Project, Argentina: On March 31, 2023, the Company filled its annual information form
containing an updated Mineral Resource estimate for the Deep Carbonates Project as at December 31, 2022,
which includes the 2021 and 2022 drilling campaign. Notwithstanding the winding down of activities at the
Gualcamayo Mine, the Company continues to analyze mining and processing scenarios for its sulphide gold
Deep Carbonates Project and is expecting to make an announcement in this regard during 2023.
CONFERENCE CALL AND WEBCAST DETAILS
The Company will host a conference call on Tuesday, May 9, 2023, at 8:00 am ET (8:00 am COT) to discuss
the results. The conference call will be in Spanish with simultaneous translation in English.
A live webcast of the conference all will be available at:
https://app.webinar.net/yjGgrk021JY
Live webcast requires previous registration, and interested parties are advised to access the webcast
approximately ten minutes prior to the start of the call. The webcast will be archived on the Company’s website
at www.mineros.com.co for approximately 30 days following the call.
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Participants may also dial in (charges may apply):
US: ‘+1 720-527-5937
Colombia ‘+57 601-485-0334
Pin for English: 6918884#
Pin for Spanish: 10178681#
The list of all local and international dial in numbers can be found at the end of this document or at
https://fccdl.in/i/webcastatmedios.
ABOUT MINEROS S.A.
Mineros is a gold mining company headquartered in Medellin, Colombia. The Company has a diversified asset
base, with mines in Colombia, Nicaragua and Argentina and a pipeline of development and exploration projects
throughout the region.
The board of directors and management of Mineros have extensive experience in mining, corporate
development, finance and sustainability. Mineros has a long track record of maximizing shareholder value and
delivering solid annual dividends. For almost 50 years Mineros has operated with a focus on safety and
sustainability at all its operations.
Mineros’ common shares are listed on the Toronto Stock Exchange under the symbol “MSA”, and on the
Colombia Stock Exchange under the symbol “MINEROS”.
For further information, please contact:
Patricia Ospina John Robert McClintock
Investor Relations Manager Investor Relations
(+57) 42665757 +1 (647) 496-3011
[email protected] [email protected]
The Company has been granted an exemption from the individual voting and majority voting requirements
applicable to listed issuers under Toronto Stock Exchange policies, on grounds that compliance with such
requirements would constitute a breach of Colombian laws and regulations which require the directors to be
elected on the basis of a slate of nominees proposed for election pursuant to an electoral quotient system. For
further information, please see the Company’s most recent annual information form filed on SEDAR at
www.sedar.com.
QUALIFIED PERSON
The scientific and technical information contained in this news release has been reviewed and approved by
Jorge Aceituno, a Registered Member of the Chilean Mining Commission and the Planning Manager, Resources
and Reserves for Mineros and a qualified person within the meaning of National Instrument 43-101 – Standards
of Disclosure for Mineral Projects (“NI 43-101”).
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FORWARD-LOOKING STATEMENTS
This news release contains “forward looking information” within the meaning of applicable Canadian securities
laws. Forward looking information includes statements that use forward looking terminology such as “may”,
“could”, “would”, “will”, “should”, “intend”, “target”, “plan”, “expect”, “budget”, “estimate”, “forecast”, “schedule”,
“anticipate”, “believe”, “continue”, “potential”, “view” or the negative or grammatical variation thereof or other
variations thereof or comparable terminology. Such forward looking information includes, without limitation,
statements with respect to the Company’s outlook for 2023; estimates for future mineral production and sales;
the Company’s expectations, strategies and plans for the Material Properties; plans in respect of the wind-down
its open pit and underground oxide gold mining operations at the Gualcamayo Property; the Company’s planned
exploration, development and production activities; statements regarding the projected exploration and
development of the Company’s projects; adding or upgrading Mineral Resources and developing new mineral
deposits; estimates of future capital and operating costs; the costs and timing of future exploration and
development; estimates for future prices of gold and other minerals; future financial or operating performance
and condition of the Company and its business, operations and properties; and any other statement that may
predict, forecast, indicate or imply future plans, intentions, levels of activity, results, performance or
achievements.
Forward looking information is based upon estimates and assumptions of management in light of management’s
experience and perception of trends, current conditions and expected developments, as well as other factors
that management believes to be relevant and reasonable in the circumstances, as of the date of this news
release including, without limitation, assumptions about: favourable equity and debt capital markets; the ability
to raise any necessary additional capital on reasonable terms to advance the production, development and
exploration of the Company’s properties and assets; future prices of gold and other metal prices; the timing and
results of exploration and drilling programs, and technical and economic studies; the accuracy of any Mineral
Reserve and Mineral Resource estimates; the geology of the Material Properties being as described in the
applicable technical reports; production costs; the accuracy of budgeted exploration and development costs and
expenditures; the orderly wind-down its open pit and underground oxide gold mining operations at the
Gualcamayo Property; the price of other commodities such as fuel; future currency exchange rates and interest
rates; operating conditions being favourable such that the Company is able to operate in a safe, efficient and
effective manner; political and regulatory stability; the receipt of governmental, regulatory and third party
approvals, licenses and permits on favourable terms; obtaining required renewals for existing approvals,
licenses and permits on favourable terms; requirements under applicable laws; sustained labour stability;
stability in financial and capital goods markets; inflation rates; availability of labour and equipment; positive
relations with local groups, including artisanal mining cooperatives in Nicaragua, and the Company’s ability to
meet its obligations under its agreements with such groups; and satisfying the terms and conditions of the
Company’s current loan arrangements. While the Company considers these assumptions to be reasonable, the
assumptions are inherently subject to significant business, social, economic, political, regulatory, competitive
and other risks and uncertainties, contingencies and other factors that could cause actual actions, events,
conditions, results, performance or achievements to be materially different from those projected in the forward
looking information. Many assumptions are based on factors and events that are not within the control of the
Company and there is no assurance they will prove to be correct.
For further information of these and other risk factors, please see the ‘‘Risk Factors” section of the Company’s
annual information form dated March 31, 2022 (as it may be updated or replaced from time to time), available
on SEDAR at www.sedar.com.
The Company cautions that the foregoing lists of important assumptions and factors are not exhaustive. Other
events or circumstances could cause actual results to differ materially from those estimated or projected and