Oceanagold Achieves Record Quarterly GOLD Production IN the First Quarter 2017
1
MEDIA RELEASE
27 April 2017
OCEANAGOLD ACHIEVES RECORD QUARTERLY GOLD PRODUCTION IN THE
FIRST QUARTER 2017
(All financial figures in US Dollars unless otherwise stated)
(MELBOURNE) OceanaGold Corporation (TSX/ASX: OGC) (the “Company”) is pleased to release its
financial and operational results for the quarter ended 31 March 2017. Details of the consolidated financial
statements and the Management Discussion and Analysis (“MD&A”) are available on the Company’s website
at www.oceanagold.com
Key Highlights
Record quarterly consolidated gold production of 147,956 ounces of gold.
Consolidated All -In Sustaining Costs of $521 per ounce on sales of 114,022 ounces of gold
(excluding Haile) and 4,148 tonnes of copper.
Revenue of $161.8 million and record quarterly EBITDA of $101.7 million.
Net profit after tax of $36.0 million after recognising an impairment charge of $17.7 million on the
mining assets held in El Salvador. Quarterly net profit before impairment was $53.7 million.
Strong balance sheet with immediate liquidity of $85.8 million including $70.6 million in cash.
Successfully transitioned the Haile Gold Mine from the Commissioning team to the Operations team.
Didipio was the recipient of top award for “Best Workplace”, second place for “Environmental
Excellence” and third place for “ Best Community Program” at the Global CSR Summit Awards held
in Malaysia.
Mick Wilkes, President and CEO said, “ I am pleased to announce another strong quarter of financial and
operational performance for OceanaGold. We achieved record quarterly gold prod uction on the back of
record production at Didipio and the commencement of production at our newest asset Haile . I am also
pleased to report that we have handed over operational control and responsibility of the Haile Gold Mine to
the Operations team as we move closer to commercial production.”
“We continue to advance the Haile Optimisation Study, which is on track for completion by mid -year, while
driving our extensive exploration program across our asset portfolio.”
He added, “With our strong balance sheet, high quality assets , with significant organic growth opportunities
and industry leading margins , we are well positioned to further deliver on our objective to enhance further
value for our stakeholders.”
2
Table 1 – Production and Cost Results Summary
Didipio Waihi Macraes Haile (2) Consolidated
First Quarter 2017 Results Q1 2017 Q4 2016
Gold Produced ounces 62,748 25,860 38,550 20,798 147,956 102,428
Copper Produced tonnes 5,955 - - - 5,955 3,765
Gold Sales ounces 51,467 26,757 35,798 12,203 126,225 (3) 105,658
Copper Sales tonnes 4,148 - - - 4,148 4,960
Cash Costs (1) $ per ounce (193) 517 864 - 306 372
All-In Sustaining
Costs (1) $ per ounce (105) 841 1,182 - 521 639
Notes:
1: In this first quarter 2017 MD&A, all revenue and costs reported do not include the Haile operations as these have been capitalised
as commercial production is yet to be declared.
2: Haile gold mine commenced selling gold in February 2017. Revenue from the sale of gold is treated as pre-production income.
3. Consolidated first quarter 2017 gold sales include gold sales from Haile.
Table 2 – Consolidated Financial Summary*
Note:
*: In this first quarter 2017 MD&A, all revenue and costs reported do not include the Haile operations as these have been capitalised
as commercial production is yet to be declared.
$’000 Q1
Mar 31 2017
Q4
Dec 31 2016
Q1
Mar 31 2016
Revenue 161,800 147,432 161,051
Cost of sales, excluding depreciation and
amortisation (56,834) (63,406) (71,889)
General & administration – legal settlement - (8,000) -
General & administration – other (8,950) (10,203) (12,368)
Foreign currency exchange gain/(loss) (221) (547) 725
Gain on sale of available-for-sale assets 5,314 - -
Other income/(expense) 562 1,614 355
Earnings before interest, tax, depreciation and
amortisation (EBITDA) (excluding gain/(loss) on
undesignated hedges and impairment charge)
101,671 66,890 77,874
Depreciation and amortisation (36,403) (28,807) (33,769)
Net interest expense and finance costs (4,557) (2,112) (2,189)
Earnings before income tax and gain/(loss) on
undesignated hedges and impairment charge 60,711 35,971 41,916
Tax (expense) / benefit on earnings (1,318) (4,318) (5,206)
Earnings/(loss) after income tax and before
gain/(loss) on undesignated hedges and
impairment charge
59,393 31,653 36,710
Impairment charge (17,654) - -
Gain/(loss) on fair value of undesignated hedges (7,874) 15,343 (18,304)
Tax (expense)/benefit on gain/loss on undesignated
hedges 2,205 (4,296) 5,125
Share of profit/(loss) from equity accounted
associates (65) (126) -
Net Profit 36,005 42,574 23,531
Basic earnings per share $0.06 $0.07 $0.04
CASH FLOWS
Cash flows from Operating Activities 52,343 79,765 31,673
Cash flows used in Investing Activities (65,910) (120,698) (103,740)
Cash flows from / (used in) Financing Activities 10,545 26,116 2,033
3
On a consolidated basis, during the first quarter of 2017 the Company achieved a quarterly production record
147,956 ounces of gold driven by strong production from Didipio and commencement of production from the
Haile Gold Mine. The Company also produced 5,955 tonnes of copper representing a 58% quarter-on quarter
increase.
On a consolidated basis, and excluding Haile gold sales, the Company recorded an AISC of $521 per ounce
on sales of 114,022 ounces of gold and 4,148 tonnes of copper while consolidated cash costs were $306 per
ounce sold.
In the first quarter, the Company achiev ed revenue of $ 161.8 million, which was 10% higher than in the
previous quarter due to a significant increase in gold sales. The quarter-on-quarter increase was partly offset
by lower copper sales.
The Company achieved record quarterly EBITDA of $10 1.7 million, up 5 2% quarter -on-quarter, primarily
driven by stronger revenue, lower operating and general and administrative (“G&A”) costs.
The Company achieved a net profit, before impairment, of $53.7 million, which was 26% higher than in the
previous quarter. The Company recognised an impairment charge of $17.7 million on the mining assets held
in El Salvador. The net profit after impairment was $36.0 million.
Cash flows from operating activities for the first quarter were lower compared to the previous q uarter mainly
due to an increase in working capital at Didipio from a build-up of concentrate inventories and a provisional
income tax payment of $7.0 million made by the Waihi Gold Mine.
At the end of the first quarter of 2017, the Company had immediate available liquidity of $85.8 million which
included a cash balance of $ 70.6 million, excluding $90.2 million in marketable securities from strategic
investments. During the quarter, the Company drew down $12.0 million from its revolving credit facility and
repaid $3.6 million of finance lease repayments. At the end of the quarter, total debt stood at $332.8 million.
In March 2017, the Didipio Mine received the top award for “Best Workplace Practices”, second place award
for Environmental Excellence and third place award for Best Community Program at the annual Global CSR
Summit Awards in Malaysi a, which recognises corporate social responsibility excellence across multiple
industries. In addition, during the quarter, the Mines and Geosciences Bureau of th e Department of
Environment and Natural Resources (“DENR”) selected the Didipio Mine for Best Practices in Mineral
Processing and the Philippines’ entry to the First ASEAN Mineral Awards, to be held in Myanmar in late 2017.
First Quarter 2017 Results Webcast
The Company will host a conference call / webcast to discuss the results at 7:30 am on 28 April 2017
(Melbourne, Australia time) / 5:30 pm on 27 April 2017 (Toronto, Canada time).
Webcast Participants
To register, please copy and paste the link below into your browser:
http://event.on24.com/r.htm?e=1395283&s=1&k=59F2A5A5B4B914E41849E55CE67CFBC9
Teleconference Participants (required for those who wish to ask questions)
4
Local (toll free) dial in numbers are:
Australia: 1 800 076 068
New Zealand: 0 800 453 421
Canada & North America: 1 888 390 0546
All other countries (toll): + 1 416 764 8688
Playback of Webcast
If you are unable to attend the call, a recording will be available for viewing on the Company’s website
- ENDS -
For further information please contact:
Investor Relations
Sam Pazuki
Tel: +1 416 915 3123
Jeffrey Sansom
Tel: +61 3 9656 5300
Media Relations
Jill Thomas
Tel: +61 3 9656 5300
[email protected] | www.oceanagold.com | Twitter: @OceanaGold
About OceanaGold
OceanaGold Corporation is a mid -tier, high-margin, multinational gold producer with assets located in the
Philippines, New Zealand and the United States. The Company’s assets encompass its flagship operation,
the Didipio Gold-Copper Mine located on the isl and of Luzon in the Philippines. On the North Island of New
Zealand, the Company operates the high-grade Waihi Gold Mine while on the South Island of New Zealand,
the Company operates the largest gold mine in the country at the Macraes Goldfield which is m ade up of a
series of open pit mines and the Frasers underground mine. In the United States, the Company is currently
commissioning the Haile Gold Mine, a top -tier asset located in South Carolina along the Carolina Terrane.
The Company expects the Haile Go ld Mine to commence commercial production in the second quarter of
2017. OceanaGold also has a significant pipeline of organic growth and exploration opportunities in the
Americas, Asia-Pacific and Australasia regions.
OceanaGold has operated sustainably over the past 2 7 years with a proven track record for environmental
management and community and social engagement. The Company has a strong social license to operate
5
and works collaboratively with its valued stakeholders to identify and invest in social p rograms that are
designed to build capacity and not dependency.
In 2017, the Company expects to produce 550,000 to 610,000 ounces of gold and 15,000 to 17,000 tonnes
of copper with sector leading All-In Sustaining Costs that range from $600 to $650 per ounce sold.
Cautionary Statement for Public Release
Certain information contained in this public release may be deemed “forward -looking” within the meaning of
applicable securities laws. Forward -looking statements and information relate to future performance and
reflect the Company’s expectations regarding the generation of free cash flow, execution of business
strategy, future growth, future production, estimated costs, results of operations, business prospects and
opportunities of OceanaGold Corporation and its related subsidiaries. Any statements that express or involve
discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or
future events or performance (often, but not always, using words or phrases such as "expects" or "does not
expect", "is expected", "anticipates" or "does not anticipate", "plans", "estimates" or "intends", or stating that
certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved) are
not statements of historical fact and may be forward -looking statements. Forward -looking statements are
subject to a variety of risks and uncertainties which could cause actual events or results to differ materially
from those expressed in the forward -looking statements and information. They include, among others, the
accuracy of mineral reserve and resource estimates and related assumptions, inherent operating risks ,
sovereign risks, risk of suspension and those risk factors identified in the Company’s mos t recent Annual
Information Form prepared and filed with securities regulators which is available on SEDAR at
www.sedar.com under the Company’s name. There are no assurances the Company can fulfil forward -
looking statements and information. Such forward -looking statements and information are only predictions
based on current information available to management as of the date that such predictions are made; actual
events or results may differ materially as a result of risks facing the Company, some of which are beyond the
Company's control. Although the Company believes that any forward -looking statements and information
contained in this press release is based on reasonable assumptions, readers cannot be assu red that actual
outcomes or results will be consistent with such statements. Accordingly, readers should not place undue
reliance on forward-looking statements and information. The Company expressly disclaims any intention or
obligation to update or revise any forward-looking statements and information, whether as a result of new
information, events or otherwise, except as required by applicable securities laws. The information contained
in this release is not investment or financial product advice.
NOT FOR DISSEMINATION OR DISTRIBUTION IN THE UNITED STATES AND NOT FOR DISTRIBUTION
TO US NEWSWIRE SERVICES.