News Feed Item

Mandalay Resources Announces Financial Results and Quarterly Dividend for the Second Quarter of 2014

TORONTO, Aug. 6, 2014 /CNW/ - Mandalay Resources Corporation ("Mandalay" or the "Company") (TSX: MND) announced today revenue of $44.9 million, adjusted EBITDA of $16.4 million and net income of $4.9 million or $0.01 per share for the second quarter of 2014. The Company's unaudited consolidated financial results for the three and six months ended June 30, 2014, together with its Management's Discussion and Analysis ("MD&A") for the corresponding period can be accessed under the Company's profile on www.sedar.com and on the Company's website at www.mandalayresources.com. All currency references in this press release are in U.S. dollars except as otherwise indicated.

In accordance with the Company's dividend policy, Mandalay's Board of Directors declared a quarterly dividend of $2,693,278 (6% of the trailing quarter's gross revenue), or $0.0079 per share (CDN$ 0.0086 per share), payable on August 28, 2014 to shareholders of record as of August 18, 2014.

Brad Mills, Chief Executive Officer of Mandalay, commented, "Cerro Bayo and Costerfield delivered steady operational and financial performance in the second quarter. This result is especially pleasing given the various transition issues the business faced in the quarter as it ramped up production at Cerro Bayo to 1,400 tpd from 1,200 tpd and transitioned mining from the W-lode to the Cuffley lode at Costerfield. Cerro Bayo achieved its new design rate at the end of June and we started delivering the first stoping ore tonnes from Cuffley in August.

Unit costs for both mines were within the expected range for the period and half year. Cerro Bayo cash costs were notable at under $6/ounce of silver produced net of gold credits. Costerfield unit costs were impacted a bit negatively during the quarter due to variety of transition issues related to the Cuffley mine startup and are expected to improve significantly in the second half of the year.  With both of the growth projects nearing completion, we expect to see volumes improve in the second half and costs decrease further.

During the quarter, the Company also secured $60 million in 5.875% five year debt to ensure the funding of the Challacollo development project and announced the acquisition of Elgin Mining Inc.  With a quarter-end cash balance of $69 million and a working capital balance of $93 million, the Company is in an excellent financial position to deliver the growth of both the Challacollo project and Björkdal mine in the coming years."

Second Quarter 2014 Financial Highlights

The following table summarizes the Company's financial results for the second quarter of 2014 and 2013:

  Three months
June 30, 2014
Three months
June 30, 2013
Six months
June 30, 2014
Six months
June 30, 2013
  $ $ $ $
Revenue 44,887,966 35,903,497 82,979,810 77,528,185
Adjusted EBITDA 16,403,983 10,989,749 32,430,649 30,827,831
Income from mine operations 10,549,487 5,043,404 20,981,620 20,828,470
Net Income/ (Loss) 4,935,833 3,104,793 10,679,906 14,008,907
Total assets 273,952,425 184,849,080 273,952,425 184,849,080
Total liabilities 98,737,432 39,810,925 98,737,432 39,810,925
Earnings/ (Loss) per share 0.01 0.01 0.03 0.04

The increases in revenue, adjusted EBITDA and profit during the second quarter of 2014 over the same quarter in 2013 were principally due to the higher volumes sold and increases in metal prices.

Net income is inclusive of a non-cash, non-operating loss of $148,040 related to mark-to-market adjustments of financing warrants and an AUD/USD currency option and deferred tax income of $10,967. Excluding these items, income after tax from underlying operations for the second quarter was $5,072,906 ($0.01 per share). By comparison, in the second quarter of 2013 the Company's net income of $3,104,793 ($0.01 per share) was inclusive of non-cash, non-operating gain of $422,359 related to mark-to-market adjustments of financing warrants and deferred tax recovery of $1,757,773. Excluding these items, income after tax from underlying operations in the second quarter of 2013 was $924,661 ($0.00 per share).

On May 26, 2014, Mandalay paid a quarterly dividend in the aggregate amount of $2,334,883 (CDN$ 0.0074 per share). In May, 2014 Mandalay completed a $60 million five year 5.875% debt financing (see press release of May 14, 2014).  Cash and cash equivalents of the Company were $69 million as of June 30, 2014 compared to $23.9 million as of June 30, 2013.

Second Quarter 2014 Operational Highlights

Costerfield gold-antimony mine, Victoria, Australia

In the second quarter of 2014, Costerfield produced 7,256 ounces ("oz") of saleable gold ("Au") and 855 tonnes ("t") of saleable antimony ("Sb"), versus 6,879 oz Au and 738 t Sb in the second quarter of 2013.

Cash cost per Au Eq. oz produced in the second quarter of 2014 was $989 versus $917 in the second quarter of 2013. The higher cash cost per oz in the second quarter of 2014 was mainly due to higher operating costs incurred in the transition of mining from the W-lode to the Cuffley lode and higher environmental and community related issues associated with addressing potential antimony crusher dust dispersion. The site all-in cost per Au eq. oz produced in the second quarter of 2014 was $1,278, versus $1,178 in the second quarter of 2013. The Company expects this cost to decline materially as it ramps up mining in the Cuffley lode.

Cerro Bayo silver-gold mine, Patagonia, Chile

During the second quarter of 2014, the Cerro Bayo mine produced 741,382 oz of saleable silver ("Ag") and a record 6,823 oz of saleable Au, versus 921,895 oz Ag and 6,167 oz Au in the second quarter of 2013. The variation in production quantities is attributable to the higher tonnes mined and processed in the current quarter as the Company increased production toward 1,400 tpd. Silver grades were lower than the comparable quarter and gold grades mined were higher.

Cash cost per oz Ag produced net of Au by-product was $5.83 during the second quarter of 2014, lower than the $6.12 in the second quarter of 2013, principally due to higher Au credits achieved arising from a higher Au price and higher Au production. Site all-in costs were $12.08/oz versus $11.54/oz in the previous year.

Conference Call

Mandalay Management will be hosting a conference call for investors and analysts on August 7, 2014 at 8:00 am (Toronto time). Analysts and interested investors are invited to participate using the following dial-in numbers:

Participant Number (International/Local): (416) 764-8688
Participant Number (Toll free North America): (888) 390-0546
Conference ID: 46269373

A replay of the conference call will be available until 23:59 pm (Toronto time), August 21, 2014 and can be accessed using the following dial-in numbers:

Encore Toll Free Dial-in Number: 1-888-390-0541
Local Dial-in-Number: (416) 764-8677
Encore ID: 269373

About Mandalay Resources Corporation:

Mandalay Resources is a Canadian-based natural resource company with producing assets in Australia and producing and development projects in Chile. The Company is focused on executing a roll-up strategy, creating critical mass by aggregating advanced or in-production gold, copper, silver and antimony projects in Australia and the Americas to generate near-term cash flow and shareholder value.

Forward-Looking Statements

This news release contains "forward-looking statements" within the meaning of applicable securities laws, including guidance as to anticipated gold, silver, and antimony production in future year or years. Readers are cautioned not to place undue reliance on forward-looking statements. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, changes in commodity prices and general market and economic conditions. The factors identified above are not intended to represent a complete list of the factors that could affect Mandalay. A description of additional risks that could result in actual results and developments differing from those contemplated by forward-looking statements in this news release can be found under the heading "Risk Factors" in Mandalay's annual information form dated March 28, 2014, a copy of which is available under Mandalay's profile at www.sedar.com. Although Mandalay has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.

Non-IFRS Measures

This news release may contain references to adjusted EBITDA, cash cost per ounce of gold equivalent produced, cash cost per saleable ounce of silver produced net of gold credits, site all-in cost per ounce of gold equivalent produced and site all-in cost per saleable ounce of silver produced net of gold credits, which are all non-IFRS measures and do not have standardized meanings under IFRS. Therefore, these measures may not be comparable to similar measures presented by other issuers. Management uses adjusted EBITDA as measures of operating performance to assist in comparing the Company's ability to generate liquidity through operating cash flow to fund future working capital needs and fund future capital expenditures and to assist in financial performance from period to period on a consistent basis. The Company believes that these measures are used by and are useful to investors and other users of the Company's financial statements in evaluating the Company's operating and cash performance because they allow for analysis of our financial results without regard to special, non-cash and other non-core items, which can vary substantially from company to company and over different periods.

The Company defines adjusted EBITDA as earnings before interest, taxes, non-cash charges and finance costs. For a detailed reconciliation of net income to adjusted EBITDA, please refer to page 11 of management's discussion and analysis of the Company's financial statements for the second quarter of 2014.

Equivalent gold ounces produced is calculated by adding to gold ounces produced, the antimony tonnes produced times the average antimony price in the period divided by the average gold price in the period.  The total cash operating cost associated with the production of these equivalent ounces produced in the period is then divided by the equivalent gold ounces produced to yield the cash cost per equivalent ounce produced. The cash cost excludes royalty expenses. Values for 2013 have been re‐calculated accordingly.  Site all-in costs include total cash operating costs, royalty expense, depletion, depreciation, accretion and write-off of exploration and evaluation. The site all-in cost is then divided by the equivalent gold ounces produced to yield the site all-in cost per equivalent ounce produced.

The cash cost per silver ounce produced net of gold byproduct credit is calculated by deducting the gold credit (which equals ounces gold produced times the realized gold price in the period) from the cash operating costs in the period and dividing the resultant number by the silver ounces produced in the period. The cash cost excludes royalty expenses. The site all-in cost per silver ounce produced net of gold byproduct credit is calculated by adding royalty expenses, depletion, depreciation, accretion and write-off of exploration and evaluation to the cash cost net of gold byproduct credit dividing the resultant number by the silver ounces produced in the period.

SOURCE Mandalay Resources Corporation

More Stories By PR Newswire

Copyright © 2007 PR Newswire. All rights reserved. Republication or redistribution of PRNewswire content is expressly prohibited without the prior written consent of PRNewswire. PRNewswire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
President Obama recently announced the launch of a new national awareness campaign to "encourage more Americans to move beyond passwords – adding an extra layer of security like a fingerprint or codes sent to your cellphone." The shift from single passwords to multi-factor authentication couldn’t be timelier or more strategic. This session will focus on why passwords alone are no longer effective, and why the time to act is now. In his session at 19th Cloud Expo, Chris Webber, security strateg...
In past @ThingsExpo presentations, Joseph di Paolantonio has explored how various Internet of Things (IoT) and data management and analytics (DMA) solution spaces will come together as sensor analytics ecosystems. This year, in his session at @ThingsExpo, Joseph di Paolantonio from DataArchon, will be adding the numerous Transportation areas, from autonomous vehicles to “Uber for containers.” While IoT data in any one area of Transportation will have a huge impact in that area, combining sensor...
In his general session at 19th Cloud Expo, Manish Dixit, VP of Product and Engineering at Dice, will discuss how Dice leverages data insights and tools to help both tech professionals and recruiters better understand how skills relate to each other and which skills are in high demand using interactive visualizations and salary indicator tools to maximize earning potential. Manish Dixit is VP of Product and Engineering at Dice. As the leader of the Product, Engineering and Data Sciences team a...
SYS-CON Events announced today that Tintri Inc., a leading producer of VM-aware storage (VAS) for virtualization and cloud environments, will present at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Tintri VM-aware storage is the simplest for virtualized applications and cloud. Organizations including GE, Toyota, United Healthcare, NASA and 6 of the Fortune 15 have said “No to LUNs.” With Tintri they manag...
As companies adopt the cloud-to-streamline workflow, deployment hasn’t been very seamless because of IT concerns surrounding security risks. The cloud offers many benefits, but protecting and securing information can be tricky across multiple cloud providers and remains IT’s overall responsibility. In his session at 19th Cloud Expo, Simon Bain, CEO of SearchYourCloud, will address security compliance issues associated with cloud applications and how document-level encryption is critical for sup...
DevOps is speeding towards the IT world like a freight train and the hype around it is deafening. There is no reason to be afraid of this change as it is the natural reaction to the agile movement that revolutionized development just a few years ago. By definition, DevOps is the natural alignment of IT performance to business profitability. The relevance of this has yet to be quantified but it has been suggested that the route to the CEO’s chair will come from the IT leaders that successfully ma...
Join IBM November 2 at 19th Cloud Expo at the Santa Clara Convention Center in Santa Clara, CA, and learn how to go beyond multi-speed it to bring agility to traditional enterprise applications. Technology innovation is the driving force behind modern business and enterprises must respond by increasing the speed and efficiency of software delivery. The challenge is that existing enterprise applications are expensive to develop and difficult to modernize. This often results in what Gartner calls...
We are always online. We access our data, our finances, work, and various services on the Internet. But we live in a congested world of information in which the roads were built two decades ago. The quest for better, faster Internet routing has been around for a decade, but nobody solved this problem. We’ve seen band aid approaches like CDNs that attack a niche's slice of static content part of the Internet, but that’s it. It does not address the dynamic services-based Internet of today. It doe...
Although it has gained significant traction in the consumer space, IoT is still in the early stages of adoption in enterprises environments. However, many companies are working on initiatives like Industry 4.0 that includes IoT as one of the key disruptive technologies expected to reshape businesses of tomorrow. The key challenges will be availability, robustness and reliability of networks that connect devices in a business environment. Software Defined Wide Area Network (SD-WAN) is expected to...
The explosion of new web/cloud/IoT-based applications and the data they generate are transforming our world right before our eyes. In this rush to adopt these new technologies, organizations are often ignoring fundamental questions concerning who owns the data and failing to ask for permission to conduct invasive surveillance of their customers. Organizations that are not transparent about how their systems gather data telemetry without offering shared data ownership risk product rejection, regu...
Bert Loomis was a visionary. This general session will highlight how Bert Loomis and people like him inspire us to build great things with small inventions. In their general session at 19th Cloud Expo, Harold Hannon, Architect at IBM Bluemix, and Michael O'Neill, Strategic Business Development at Nvidia, will discuss the accelerating pace of AI development and how IBM Cloud and NVIDIA are partnering to bring AI capabilities to "every day," on-demand. They will also review two "free infrastruct...
The Internet of Things (IoT), in all its myriad manifestations, has great potential. Much of that potential comes from the evolving data management and analytic (DMA) technologies and processes that allow us to gain insight from all of the IoT data that can be generated and gathered. This potential may never be met as those data sets are tied to specific industry verticals and single markets, with no clear way to use IoT data and sensor analytics to fulfill the hype being given the IoT today.
@ThingsExpo has been named the Top 5 Most Influential M2M Brand by Onalytica in the ‘Machine to Machine: Top 100 Influencers and Brands.' Onalytica analyzed the online debate on M2M by looking at over 85,000 tweets to provide the most influential individuals and brands that drive the discussion. According to Onalytica the "analysis showed a very engaged community with a lot of interactive tweets. The M2M discussion seems to be more fragmented and driven by some of the major brands present in the...
Fact: storage performance problems have only gotten more complicated, as applications not only have become largely virtualized, but also have moved to cloud-based infrastructures. Storage performance in virtualized environments isn’t just about IOPS anymore. Instead, you need to guarantee performance for individual VMs, helping applications maintain performance as the number of VMs continues to go up in real time. In his session at Cloud Expo, Dhiraj Sehgal, Product and Marketing at Tintri, wil...
Enterprises have been using both Big Data and virtualization for years. Until recently, however, most enterprises have not combined the two. Big Data's demands for higher levels of performance, the ability to control quality-of-service (QoS), and the ability to adhere to SLAs have kept it on bare metal, apart from the modern data center cloud. With recent technology innovations, we've seen the advantages of bare metal erode to such a degree that the enhanced flexibility and reduced costs that cl...