Oceanagold Reports Full Year 2018 Financials
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MEDIA RELEASE
19 February 2019
OCEANAGOLD REPORTS FULL YEAR 2018 FINANCIALS
(All financial figures in US Dollars unless otherwise stated)
(MELBOURNE) OceanaGold Corporation (TSX: OGC / ASX: OGC ) (the “Company”) reported its full year
2018 financial and operational results for the year ended 31 December 2018. This follows the release of the
Company’s operational results on 24 January 2019. 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
• Generated approximately $121 million in Free Cash Flow in 2018.
• Achieved annual revenue of $773 million.
• Reported EBITDA of $364 million and adjusted net profit of $ 124 million (before unrealised gains or
losses on undesignated hedges) for the full year.
• Fourth quarter revenue of $183 million including EBITDA of $74 million and adjusted net profit of $17
million for the quarter.
• Increased cash balance to $108 million, which excludes $55 million of marketable securities held as
strategic investments.
• Reduced net debt by 38% on the previous quarter to $69 million.
• Subsequent to the year end, received the permit for the Martha Underground Project and Stage Four
of the Martha Open Pit at Waihi with implementation plans underway.
• Subsequent to the year end, the Board of Directors declared an ordinary semi-annual dividend of
$0.01 per common share or CDI.
Mick Wilkes, President and CEO said, “I’m pleased to report another strong year of financial results with free
cash flow generation of $121 million. Our cash balance increased 47% year-on-year reflecting the Company’s
consistent profitability over the past several years. Our net debt reduced by 59% over the past year, reflecting
the strong cash flow generation in 2018 and our commitment to strengthen our balance sheet through
discretionary debt repayments.”
“In 2018, OceanaGold delivered an EBITDA margin of 47% while we achieved the ninth consecutive year of
positive returns on invested capital. On the back of the significant cash flow generation, the Board of Directors
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is pleased to declare its first dividend of the ye ar, demonstrating our discipline and commitment to provide
returns to shareholders.”
“We are well positioned to invest in our future to expand our operations and/or extend their mine lives, all
with an objective to create long-term value for both shareholders and communities in which we operate. One
such investment is Waihi, where we have received the permit for the Martha Underground Project and are
mobilising to implement this growth project in a way that will maximise its value to all stakeholders.”
Table 1 – Production and Cost Results Summary
Quarter ended 31 Dec 2018 Haile Didipio Waihi Macraes
Consolidated
Q4 2018 Q4 2017
Gold Produced koz 27.5 23.3 17.6 58.2 126.7 166.2
Gold Sales koz 27.6 25.2 19.6 59.7 132.2 168.6
Average Gold Price US$/oz 1,236 1,279 1,229 1,226 1,239 1,275
Copper Produced kt - 2.9 - - 2.9 3.7
Copper Sales kt - 3.1 - - 3.1 4.8
Average Copper Price US$/lb - 3.04 - - 3.04 3.17
Cash Costs US$/oz 814 466 620 469 563 300
All-In Sustaining Costs US$/oz 1,181 711 783 698 814 564
2018 Haile Didipio Waihi Macraes
Consolidated
2018 2017
Gold Produced koz 131.8 115.0 83.5 203.0 533.3 574.6
Gold Sales koz 130.5 116.9 86.5 198.9 532.7 555.6
Average Gold Price US$/oz 1,277 1,268 1,262 1,264 1,268 1,261
Copper Produced kt - 15.0 - - 15.0 18.4
Copper Sales kt - 14.5 - - 14.5 18.1
Average Copper Price US$/lb 3.05 3.05 2.78
Cash Costs US$/oz 499 271 615 557 489 347
All-In Sustaining Costs US$/oz 903 427 763 879 767 617
Table 2 – Financial Summary
Quarter ended 31 Dec 2018
(US$m)
Q4
31 Dec 2018
Q3
30 Sep 2018
Q4
31 Dec 2017 20182) 2017(1)
Revenue 183.3 186.8 246.1 772.5 724.4
Cost of sales, excluding depreciation and amortisation (95.3) (92.3) (85.3) (355.5) (275.4)
General and administration – other (12.7) (12.3) (12.7) (47.9) (44.8)
General and administration – indirect taxes (3) (3.1) (4.0) (0.1) (12.0) (4.9)
Foreign currency exchange gain/(loss) 0.6 0.7 0.2 3.1 0.9
Gain on sale of available-for-sale assets - - - - 5.3
Other income/(expense) 0.9 0.5 0.3 3.5 2.9
EBITDA (excluding gain/(loss) on undesignated
hedges and impairment charge) 73.7 79.4 148.6 363.7 408.4
Depreciation and amortization (45.3) (46.6) (60.4) (191.0) (192.3)
Net interest expense and finance costs (2.8) (4.0) (4.0) (14.2) (17.1)
Earnings before income tax (excluding gain/(loss) on
undesignated hedges and impairment charge) 25.6 28.8 84.2 158.5 198.9
Income tax expense on earnings (8.2) (8.4) 9.5 (34.5) 0.4
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Quarter ended 31 Dec 2018
(US$m)
Q4
31 Dec 2018
Q3
30 Sep 2018
Q4
31 Dec 2017 20182) 2017(1)
Earnings after income tax and before gain/(loss) on
undesignated hedges and impairment charge 17.4 20.4 93.7 124.1 199.3
Impairment charge - - - - (17.7)
Write off deferred exploration expenditure (1.2) - - (4.2) -
Gain/(loss) on fair value of undesignated hedges (5.9) 1.4 (5.8) 1.5 (12.0)
Tax (expense) / benefit on gain/loss on undesignated
hedges 0.6 (0.1) 0.9 0.4 2.6
Share of loss from equity accounted associates (0.1) (0.0) (0.1) (0.3) (0.5)
Net Profit 10.9 21.7 88.6 121.7 171.8
Basic earnings per share $0.02 $0.04 $0.14 $0.20 $0.28
Diluted earnings per share $0.02 $0.03 $0.14 $0.19 $0.27
(1) For the nine months ended September 30, 2017, all revenue and costs reported did not include the Haile operations
as these were capitalised as commercial production was declared effective from October 1, 2017.
(2) The Company’s consolidated financial results for the quarter ended March 31, 2018 reflect ed adjustments on adoption
of IFRS 15 effective from January 1, 2018.
(3) Represents indirect taxes in the Philippines – specifically excise tax (expensed as from April 1, 2018) , local business
and property taxes.
Table 3 – Cash Flow Summary
Quarter ended 31 Dec 2018
(US$m)
Q4
Dec 31 2018
Q3
Sep 30 2018
Q4
Dec 31 2017 2018 2017
Cash flows from Operating Activities 95.8 64.3 178.8 346.2 357.7
Cash flows used in Investing Activities (51.2) (58.7) (74.5) (229.0) (262.6)
Cash flows used in Financing Activities (3.3) (63.3) (79.7) (79.3) (89.5)
For the full year, the Company achieved annual revenue of $7 73 million, which was 7% higher than in the
previous year. The Company recorded full year EBITDA of $364 million including $74 million in the fourth
quarter. Net profit before unrealised (non-cash) gains on undesignated hedges was $124 million for the full
year including $17 million in the fourth quarter.
For the full year, the Company generat ed $346 million in operating cash flow including $96 million in the
fourth quarter. Cash flows used in investing activities were slightly lower qu arter-on-quarter and year-on-
year, with continued reduction in growth capital . Cash flows used in financing activities were significantly
lower quarter-on-quarter due mainly to discretionary debt repayments and dividends paid in the third quarter
of 2018.
As at the end of 2018, the Company’s cash balance stood at $108 million , excluding approximately $55
million held in strategic equity investments. Total liquidity increased to $158 million while net debt at the end
of 2018 was $69 million.
Dividend
The OceanaGold Board of Directors has declared its first dividend for 2019 of $0.01 per ordinary share for
an aggregate of approximately $6.2 million.
Shareholders of record at the close of business in each jurisdiction on March 7, 2019 (the “Record Date”) will
be entitled to receive payment of the dividend on April 26, 2019. The dividend payment applies to holders of
record of the Company’s common shares traded on the Toronto Stock Exchange and holders of CHESS
depository interests ("CDIs") traded on the Australian Securities Exchange.
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Table 4 – Dividend Key Dates
Date
Last date for processing requests to convert securities between stock
exchanges before the Record Date1 Monday March 4, 2019
Common Shares (TSX) trade on an ex-dividend basis (TSX) Tuesday March 5, 2019
CDIs (ASX) trade on an ex-dividend basis (ASX) Wednesday March 6, 2019
Record Date Thursday March 7, 2019
Processing recommences for requests to convert securities between
stock exchanges1 Friday March 8, 2019
Dividend Payment Date Friday April 26, 2019
At the election of the security holder, the Company will pay the dividend in US Dollars, Australian Dollars or
New Zealand Dollars for ASX listed CDIs, and US Dollars or Canadian Dollars for TSX listed common shares.
Please refer to the end of this media release for important information relating to Australian income tax and
Canadian withholding tax.
Growth
The Company continues to advance its organic growth opportunities, mainly at Haile in the United States
and Waihi in New Zealand. Additionally, the Company has increased its capital expenditures in exploration
with drilling programs across its operational footprint, greenfield targets such as WKP and investments in
newly signed joint venture agreements with junior exploration companies operating in Nevada.
At Waihi, the Company recently received the permit for the Martha Underground Project and will begin
implementation over the coming months. The permit also allows the operation to regain access to the Martha
Open Pit (Stage 4). The Company will also continue to drill the mineralisation beneath the open pit with an
objective to increase mineral resources.
At Haile, the upgrade to the regrinding circuit continues to progress to plan with commissioning of the Tower
Mill nearly complete and the IsaMill is nearly ready for the start of commissioning. The Company expects to
fully commission the regrinding circuit in the first half of 2019.
Subject to permitting, which is progressing well, t he Horseshoe Underground Project is expected to be in
production in late 2020 or early 2021 as per the original schedule outlined in the Haile 43 -101 Technical
Report.
At Macraes, the Company has previously stated that through exploration and mine planning, it is seeking to
extend the mine life. One of these opportunities is at Golden Point, where the Company is investigating the
potential for a standalone underground operation.
1 The Company has sought and expects to be granted a temporary waiver of the relevant ASX Settlement Operating
Rules. Under the waiver, the processing of transfers of Common Shares and CDIs between stock exchanges, lodged
after March 4, 2019, will be deferred until after the Record Date of March 7, 2019.
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Exploration activities continue to be a major focus for the Company’s organic growth objectives. Drill
programs in New Zealand and the United States , in particular , are focused on targets within the existing
operating footprint and across greenfield locations. The Company is also seeking additional opportunities in
new gold provinces through joint ventures with junior exploration companies.
Full Year Results and Webcast
The Company will release its financial and operational results for the fourth quarter and full year ending 31
December 2018 before the TSX market open on Tuesday February 19, 2019 (Toronto, Canada time) . The
results will be posted on OceanaGold’s website at www.oceanagold.com
The Company will host a conference call / webcast to discuss the results at 8:30 am on Wednesday February
20, 2019 (Melbourne, Australia Time) / 4:30 pm on Tuesday February 19, 2019 (Toronto, Canada time).
Webcast Participants
To register, please copy and paste the link below into your browser:
https://event.on24.com/wcc/r/1920900/EB1D4754F01464F39B0D9DA9DBAAF325
Teleconference Participants (required for those who wish to ask questions)
Local (toll free) dial in numbers are:
Canada & North America: 1 888 390 0546
Australia: 1 800 076 068
New Zealand: 0 800 453 421
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 Media Relations
Sam Pazuki
Tel: +1 416 915 3123
Melissa Bowerman
Tel: +61 459 900 099
[email protected] [email protected]
www.oceanagold.com | Twitter: @OceanaGold
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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 the Didipio Gold-Copper
Mine located on the island 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 wh ich is made up of a series of open pit mines
and the Frasers underground mine. In the United States, the Company operates the Haile Gold Mine, a top-
tier, long-life, high-margin asset located in South Carolina. OceanaGold also has a significant pipeline of
organic growth and exploration opportunities in the Americas and Asia-Pacific regions.
OceanaGold has operated sustainably since 1990 with a proven track-record for environmental management
and community and social engagement. The Company has a strong so cial license to operate and works
collaboratively with its valued stakeholders to identify and invest in social programs that are designed to build
capacity and not dependency.
In 2018, the Company produced 533,286 ounces of gold and 14,999 tonnes of copper with All-In Sustaining
Costs of $767 per ounce on gold sales of 532,716 ounces and copper sales of 14,527 tonnes. In 2019, the
Company expects to produce between 500,000 to 550,000 ounces of gold and 14,000 to 15,000 tonnes of
copper at All-In Sustaining Costs ranging between $850 and $900 per ounce sold.
Tax Information for Dividend
Australian Income Tax
For Australian income tax purposes, the dividend is unfranked and there is no amount of Conduit Foreign
Income per security for this dividend payment.
Canadian Withholding Tax
Holders of Common Shares or CDIs are advised that this dividend is designated by the Company to be an
“eligible dividend” pursuant to subsection 89(14) of the Income Tax Act (Canada) and corresponding
provincial legislat ion. As the dividend originates from Canada, withholding tax at the rate of 25% will be
deducted from dividends paid to non-Canadian residents unless the shareholder or CDI holder is a resident
of a country with a tax treaty with Canada, in which event a l ower withholding rate may apply. Such
shareholders or CDI holders must certifiy that their non -resident status by completing the relevant forms
required by the Canada Revenue Agency. The Company will mail every holder further information following
the Record Date.
Information contained in this media relase is based on the Directors’ current expectations and may be subject
to change. If any of the dates should change, the revised dates will be announced by media release and will
be available from www.oceanagold.com.
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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 a nd 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 materia lly
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 and
those risk factors identified in the Compan y’s most 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 for ward-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 assured 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.
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