Titan Reports Record Production from Empire State Mines on Q2 2022 Results
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Titan Reports Record Production from Empire State Mines on Q2 2022 Results
Vancouver, BC – August 11, 2022 – Titan Mining Corporation (TSX: TI) (“Titan” or the
"Company") today announces the results for the second quarter ended June 30, 2022. (All
amounts are in U.S. dollars unless otherwise stated)
“Titan’s Empire State Mines in New York ha s posted a record quarter with cash flow of $9.42
million from operation s and production of 16.5 million payable pounds of zinc. Equally as
important, this was accomplished with no lost time accidents,” said Don Taylor, President and
Chief Executive Officer of Titan.
Q2 2022 HIGHLIGHTS:
• $9.42 million cash flow from operations including n et income of $5.9 million or $0.04 per
share.
• Record zinc production totaling 16.5 million payable pounds and sales of 15.0 million
pounds of zinc during the quarter; both records since the mine reopened in 2017.
• Closed a $40 million revolving credit facility with National Bank of Canada, consolidati ng
the Company’s debts.
• Declared a fourth special cash dividend of C$0.01 per share.
• Cash balance of $11.0 million on June 30, 2022.
TABLE 1 Financial and Operating Highlights
1 Net Debt is a non-GAAP measure. This term is not a standardized financial measure under IFRS and might not be
comparable to similar financial measures disclosed by other issuers. See Non-GAAP Performance Measures below
for additional information.
Q2 2022 Q1 2022 YTD 2022
Operating
Payable Zinc Produced mlbs 16.5 10.1 26.6
Payable Zinc Sold mlbs 15.0 10.4 25.4
Average Realized Zinc Price $/lb 1.74 1.57 1.67
Financial
Revenue $m 20.13 13.96 34.09
Net Income $m 5.92 (2.62) 3.31
Earnings (loss) per share - basic $/sh 0.04 (0.02) 0.02
Cash Flow from Operating Activities before
changes in non-cash working capital $m 9.42 2.10 11.52
Financial Position 30-Jun-22 31-Dec-22
Cash and Cash Equivalents $m 11.02 6.04
Net Debt 1 $m 24.93 28.67
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OPERATIONS REVIEW
Mining efforts in the second quarter o f 2022 at ESM focused on the Mud Pond Apron, Mahler,
New Fold and N2D zones. Waste development continued to advance on the New Fold and
Mahler ramp systems to access high grade material expected to be mined in the second half of
2022. Tons mined increase d compared to the prior quarter as operations normalized after
experiencing a water inflow event in March due to heavy rains compounded by spring thaw.
Higher grade feed to the mill was largely sustained by mining in Lower Mahler and N2D, where
ore grades were better than anticipated.
Work on projects was minimal with no new equipment purchases and preparation of the surface
mining temporarily suspended due to permitting delays.
Consequently, zinc production guidance for the full year 2022 is decreased to 52 -56 million
payable pounds of zinc at a C1 cash cost of $0.99 - $1.03. per pound and at all-in sustaining costs
(“AISC”) of $ 1.03 to $1.08 per payable pound of zinc sold affecting the start of surface mining
production.2
Joel Rheault, Mine General Manager at ESM said, “ Although we have lowered our full year
production guidance due to delays in permitting the surface mining operations, we are confident
that we will achieve full year planned production from the underground operations. We anticipate
production from the open pits will be realized in H1/2023 once the required permits have been
received”.
EXPLORATION UPDATE
Underground:
Drill programs in the second quarter of 2022 focused on advancing definition drilling in Mud Pond
Apron, and exploration drilling at Mud Pond Main and New Fold. All underground drilling was
completed with Company owned underground drills by Company employees. A total of 9 holes
totaling 3,103 ft of definition drilling was completed at Mud Pond Main. The results f rom the
definition program will be used to refine the current mine plan in preparation for development in
H2/2022 and beyond. Additionally, 12 underground exploration holes at New Fold and Mud Pond
Apron have been completed, totaling 6,891 ft in Q2 2022. D rill results in both areas have been
successful in extending the known mineralization beyond the current resource boundaries.
Exploration drilling at Mud Pond Main and New Fold will continue into Q3 2022.Surface:
In the second quarter of 2022, surface exploration drilling focused on testing the near mine Abbot
Target, and the regional Beaver Creek target. One hole totaling 3,487 ft was drilled at Abbot,
2 C1 cash cost and AISC are non -GAAP measures. These terms are not standardized financial measures under IFRS
and might not be comparable to similar financial measures disclosed by other issuers. See Non-GAAP Performance
Measures below for additional information.
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targeting the extension of the 6/7 contact up -dip from New Fold. Only trace zinc mineralization
was encountered in the hole. Four holes were completed at Beaver Creek totaling 3,308 ft. Assay
results are pending.
Drilling in the third quarter of 2022 will be focused on regional and near mine targets, with regional
drilling continuing to test the Beaver Creek – Maple Ridge – North Gouverneur structural trend.
Near Mine drilling will focus on testing for extensions of the West Ridge mineralization.
CONSOLIDATED FINANCIAL STATEMENTS
Titan’s unaudited interim consolidated financial statements and management’s di scussion and
analysis for the six months ended June 30, 2022, are available on the Company’s website at
www.titanminingcorp.com and under the Company’s profiles on SEDAR.
Qualified Person
The scientific and technical information contained in this news release and the sampling,
analytical and test data underlying the scientific and technical information has been reviewed,
verified and approved by Donald R. Taylor, MSc., PG, President and Chi ef Executive Officer of
the Company, a qualified person for the purposes of NI 43 -101. Mr. Taylor has more than 25
years of mineral exploration and mining experience and is a Registered Professional Geologist
through the SME (registered member #4029597). The data was verified using data validation and
quality assurance procedures under high industry standards.
Assays and Quality Assurance/Quality Control
To ensure reliable sample results, the Company has a rigorous QA/QC program in place that
monitors the chain -of-custody of samples and includes the insertion of blanks and certified
reference standards at statistically derived intervals within each batch of samples. Core is
photographed and split in half with one-half retained in a secured facility for verification purposes.
Sample preparation (crushing and pulverizing) has been performed at ALS Geochemistry (“ALS”),
an independent ISO/IEC accredited lab located in Sudbury, Ontario, Canada. ALS prepares a
pulp of all samples and sends the pulps to their analytical laboratory in Vancouver, B.C., Canada,
for analysis. ALS analyzes the pulp sample by an aqua regia digestion (ME -ICP41 for 35
elements) with an ICP – AES finish including Cu (copper), Pb (lead), and Zn (zinc). All samples
in which Cu (copper), Pb (lead), or Zn (zinc) are greater than 10,000 ppm are re -run using aqua
regia digestion (Cu -OG46; Pb-OG46; and Zn -OG46) with the elements reported in percentage
(%). Silver values are determined by an aqua regia digestion with an ICP-AES finish (ME-ICP41)
with all samples with silver values greater than 100 ppm repeated using an aqua regia digestion
overlimit method (Ag -OG46) calibrated for higher levels of silver contained. Gold values are
determined by a 30 g fire assay with an ICP-AES finish (Au-ICP21).
The Company has not identified any drilling, sampling, recovery, or other factors that could
materially affect the accuracy or reliability of the data set out in this news release.
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About Titan Mining Corporation
Titan is an Augusta Group company which produces zinc concentrate at its 100%-owned Empire State
Mine located in New York state. Titan is built for growth, focused on value and committed to excellence.
For more information on the Company, please visit our website at www.titanminingcorp.com
Contact
For further information, please contact: Investor Relations: Email: [email protected]
Non-GAAP Performance Measures
This document includes non -GAAP performance measures, discussed below, that do not have a
standardized meaning prescribed by IFRS. The performance measures may not be comparable to similar
measures reported by other issuers. The Company believes that these performance measures are
commonly used by certain investors, in conjunction with conventional GAAP measures, to enhance their
understanding of the Company's performance. The Company uses these performance measures
extensively in internal decision-making processes, including to assess how well the Empire State Mine is
performing and to assist in the assessment of the overall efficiency and effectiveness of the mine site
management team. The tables below provide a reconciliation of these non -GAAP measures to the most
directly comparable IFRS measures as contained within the Company's issued financial statements.
C1 cash cost per payable pound sold
C1 cash cost per payable pound sold is a non -GAAP measure. C1 cash cost represents the cash cost
incurred at each processing stage, from mining through to recoverable metal delivered to customers,
including mine site operating and general and administrative costs, freight, treatment and refining charges.
The C1 cash cost per payable pound sold is calculated by dividing the total C1 cash costs by payable
pounds of metal sold.
All-In Sustaining Cost (AISC)
This measures the estimated cash costs to produce a pound of payable zinc plus the estimated capita l
sustaining costs to maintain the mine and mill. This measure includes the C1 cash cost per pound and
capital sustaining costs divided by pounds of payable zinc sold. All -In Sustaining Cost per payable pound
of zinc sold does not include depreciation, depletion, amortization, reclamation and exploration expenses.
Three months ended June 30, Six months ended June 30,
2022 2021 2022 2021
C1 cash cost per payable pound Total
Per
pound Total
Per
pound Total
Per
pound Total
Per
pound
Pounds of payable zinc sold
(millions) 15.0 11.0 25.4 22.9
Operating expenses and selling
costs $ 9,543 $0.64 $ 8,423 $0.76 $20,388 $0.80 $16,326 $0.71
Concentrate smelting and refining
costs 4,432 0.29 1,289 0.12 6,557 0.26 5,190 0.23
Total C1 cash cost $ 13,975 $0.93
$
9,712 $0.88 $26,945 $1.06 $21,516 $0.94
Sustaining Capital Expenditures
$
146 $0.01
$
1,318 $0.12 $1,875 $0.07 $1,397 $0.06
AISC $14,121 $0.94 $11,030 $1.00 $28,820 $1.13 $22,913 $1.00
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Sustaining capital expenditures
Sustaining capital expenditures are defined as those expenditures which do not increase payable mineral
production at a mine site and excludes all expenditures at the Company’s projects and certain expenditures
at the Company’s operating site s which are deemed expansionary in nature. Expansionary capital
expenditures are expenditures that are deemed expansionary in nature. The following table reconciles
sustaining capital expenditures and expansionary capital expenditures to the Company’s addi tions to
mineral, properties, plant and equipment (or total capital expenditures):
Six months ended June 30
2022 2021
Sustaining capital expenditures $ 1,875 $ 1,398
Expansionary capital expenditures 1,526 81
Additions to mineral, properties, plant and equipment $ 3,401 $ 1,479
Net Debt
Net debt is calculated as the sum of the current and non-current portions of long-term debt, net of the cash
and cash equivalent balance as at the balance sheet date. A reconciliation of net debt is provided below.
June 30 December 31
2022 2021
Current portion of debt $ 165 $ 95
Non-current portion of debt 35,789 34,617
Total debt $ 35,954 $ 34,712
Less: Cash and cash equivalents (11,021) (6,041)
Net debt $ 24,933 $ 28,671
Cautionary Note Regarding Forward-Looking Information
Certain statements and information contained in this new release constitute "forward-looking statements", and
"forward-looking information" within the meaning of applicable securities laws (collective ly, "forward-looking
statements"). These statements appear in a number of places in this news release and include statements
regarding our intent, or the beliefs or current expectations of our officers and directors, including zinc production
guidance; future production results; future mine plan revisions; and exploration plans. When used in this news
release words such as “to be”, "will", "planned", "expected", "potential", and similar expressions are intended to
identify these forward-looking statements. Although the Company believes that the expectations reflected in such
forward-looking statements and/or information are reasonable, undue reliance should not be placed on forward-
looking statements since the Company can give no assurance that such expectations will prove to be correct.
These statements involve known and unknown risks, uncertainties and other factors that may cause actual results
or events to vary materially from those anticipated in such forward -looking statements, including the risks,
uncertainties and other factors identified in the Company's periodic filings with Canadian securities regulators. Such
forward-looking statements are based on various assumptions, including assumptions made with regard to the
ability to advance exploration efforts at ESM; the results of such exploration efforts; the ability to secure adequate
financing (as needed); the Company maintaining its current strategy and objectives; and the Company’s ability to
achieve its growth objectives. While the Company considers these assumptions to be reasonable, based on
information currently available, they may prove to be incorrect. Except as required by applicable law, we assume
no obligation to update or to publicly announce the results of any change to any forward -looking statement
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contained herein to reflect actual results, future events or developments, changes in assumptions or changes in
other factors affecting the forward-looking statements. If we update any one or more forward-looking statements,
no inference should be drawn that we will make additional updates with respect to those or other forward-looking
statements. You should not place undue importance on forward-looking statements and should not rely upon these
statements as of any other date. All forward-looking statements contained in this news release are expressly
qualified in their entirety by this cautionary statement.