Welcome!

News Feed Item

Golden Minerals Announces Second Quarter 2014 Results

GOLDEN, Colo., Aug. 6, 2014 /PRNewswire/ -- Golden Minerals Company ("Golden Minerals" or the "Company") (NYSE MKT: AUMN) (TSX: AUM) today announced results for the quarter ending June 30, 2014.

Golden Minerals Company News Release Logo

Financial Results

The Company reported a net loss of $5.0 million in the second quarter 2014 compared to a net loss of $217.8 million in the second quarter 2013, with the difference attributable primarily to a $238.0 million impairment charge recorded in the second quarter 2013.  The Company reported zero gross margin in the current quarter as compared to a negative gross margin of $3.6 million in second quarter 2013, due to a suspension of mining activity at the Velardena Properties between mid-June 2013 and June 30, 2014.  Velardena care and maintenance costs were $1.2 million in the current quarter compared to $2.3 million in the second quarter 2013, with the difference due to the inclusion of shut down expenses in the 2013 figure.  Exploration expenses were $1.7 million in the second quarter 2014 compared to $1.2 million in the year ago period, with the difference attributable primarily to 2014 drilling at the Company's Los Azules property in Mexico.  Administrative expenses were $1.1 million in the current quarter compared to $1.6 million in the second quarter 2013.   

The Company's cash and short-term investments balance on June 30, 2014 was $10.4 million as compared to $19.1 million on December 31, 2013.  The $8.7 million decrease is due primarily to the expenditure of $2.5 million in care and maintenance and $1.0 million in drilling costs at our Velardena Properties; $2.3 million in other exploration expenditures; $0.8 million in maintenance and property holding costs at the El Quevar project; and $2.8 million in general and administrative expenses; offset in part by a reduction in working capital of $0.7 million primarily related to an increase in accounts payable for expenditures associated with drilling programs at the Velardena Properties and the Los Azules exploration project in Mexico.

Velardena Properties

During the second quarter 2014, Golden Minerals continued to evaluate plans for a restart of operations at the Velardena Properties, with the objective of implementing a plan that yields a sustainable cash margin for operations.  On June 18, 2014 the Company announced it would restart mining activities in July 2014, with plans to begin processing mined material during the fourth quarter 2014.  Mining started on July 1, 2014, and when mining and processing are ramped up through the second quarter 2015, the Company anticipates processing roughly an average of 285 tonnes per day at cash costs of between $12 to $15 per payable ounce of silver, net of gold, lead and zinc by-product credits.  At that time, the Company expects output of approximately 1.0 to 1.2 million silver equivalent ounces per annum (including silver and gold but excluding lead and zinc, and calculated at 60:1 silver to gold).  Restart plans assume silver and gold prices of $20 and $1,250 per ounce, respectively, and show positive cash flow for the Company after the second quarter 2015.  Please refer to the accompanying Form 10-Q for additional details related to Velardena's restart plan.

Also during the second quarter 2014, Golden completed a 9,000-meter drilling program at Velardena testing vein systems located largely outside the current 43-101 resource estimate.  An independent engineering firm participated in the preparation of the mining plan. Drill results have guided restart plans in which mining is expected to focus on the San Mateo, Terneras and Roca Negra veins.

Exploration and Other Updates

During the first quarter 2014, the Company completed an initial 2,000-meter drilling program at the 233-hectare Los Azules property in Chihuahua, Mexico to test down dip targets on the previously mined vein system.  Based upon phase one results, the Company subsequently conducted a phase two program and has now completed a total of 6,900 meters in 29 holes drilled from both surface and underground.  The Company has suspended drilling pending phase two results which it expects to receive in the third quarter 2014.

During the second quarter Golden continued efforts to actively solicit a partner to advance the El Quevar project located in Salta, Argentina.  Additionally, the Company continues to review strategic business opportunities, focusing on development or operating properties in North America, including Mexico.

Financial Outlook

The Company expects to have sufficient funding to continue its business strategy through 2014, ending the year with a cash balance of approximately $2.0 million.  The Company intends to spend approximately $8.5 million on the following amounts during the third and fourth quarters of 2014:  approximately $3.0 million of negative gross margin and start-up costs related to the restart of Velardena, $1.0 million of capital expenditures for mill improvements and slusher equipment; $0.5 million for ongoing maintenance and holding costs at El Quevar; $1.5 million on other exploration activities and property holding costs; and $2.0 million on general and administrative costs and $0.5 million in increased working capital.

Additional information regarding second quarter 2014 financial results may be found in the Company's 10-Q Quarterly Report which is available on the Golden Minerals website at www.goldenminerals.com.

About Golden Minerals

Golden Minerals is a Delaware corporation based in Golden, Colorado.  The Company is primarily focused on restarting operations at its Velardena Properties, the advancement of its El Quevar advanced exploration property in Argentina, and the exploration of properties in Argentina and Mexico.

Forward-Looking Statements

NON GAAP Financial Measures

Cash costs, after by-product credits, per payable ounce of silver produced is a non-GAAP financial measure that is widely used in the mining industry.   Under generally accepted accounting principles in the United States (US GAAP), there is no standardized definition of cash cost, after by-product credits, per payable ounce of silver produced, and therefore the Company's forecasted cash costs may not be comparable to similar measures reported by other companies. 

Forecasted cash costs were calculated based on the mining plan, and include all forecasted direct and indirect costs associated with the physical activities that would generate concentrate products for sale to customers, including mining to gain access to mineralized materials, mining of mineralized materials and waste, milling, third-party related treatment, refining and transportation costs, on-site administrative costs and royalties.  Forecasted cash costs do not include depreciation, depletion, amortization, exploration expenditures, reclamation and remediation costs, sustaining capital, financing costs, income taxes, or corporate general and administrative costs not directly or indirectly related to the Velardena mine.  By-product credits include forecasted revenues from gold, lead, and zinc contained in the products sold to customers.  Cash costs, after by-product credits, were divided by the quantity of payable silver forecasted to be produced during the period to arrive at cash costs, after by-product credits, per payable ounce of silver produced.   Cost of sales is the most comparable financial measure, calculated in accordance with US GAAP, to cash costs.  As compared to cash costs, cost of sales includes adjustments for changes in inventory and excludes net revenue from by-products and third-party related treatment, refining and transportation costs, which are reported as part of revenue in accordance with US GAAP.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act and applicable Canadian securities legislation, including statements regarding including the anticipated timing of restart activities at the Velardena Properties and ramp-up, mining and processing rates, veins to be mined and dilution levels; expected output amounts of salable and payable silver equivalent ounces; cash costs per ounce of payable silver net of by-product credits; expected cash outlay for re-start and ramp-up activities; anticipated positive net cash flow at the Velardena Properties and incremental cash for the Company at current silver and gold prices; anticipated expenditures in the second half of 2014 and anticipated year-end 2014 cash and cash equivalents.  These statements are subject to risks and uncertainties, including changes in geological, geostatistical and other interpretations of the information from drill programs and previous mining experience ; reliability of metallurgical testing results and changes in interpretation; unfavorable interpretations of geologic information; delays or problems in commencing mining or processing or the ramp-up of same; mining or processing problems; mining and processing costs in excess of those anticipated; unexpected variations in mineral grades, types and metallurgy; fluctuations in relevant metal prices; technical, permitting, mining, metallurgical, recovery or processing issues; problems that delay or reduce underground mine and stope construction; operational changes or problems; failure of mined material to meet expectations; failure to meet expectations regarding mining and processing rates, saleable metals, cash costs, cash flow at the Velardena Properties and incremental cash for the Company; failure of veins mined to meet expectations; higher than anticipated cash outlays to resume operations; fluctuations in silver, gold, zinc and lead prices, costs and general economic conditions; unanticipated expenses including potential expenses on strategic business opportunities; changes in political conditions, in tax, environmental and others laws in Mexico, and financial market conditions.  Golden Minerals Company assumes no obligation to update this information.  Additional risks relating to Golden Minerals Company may be found in the periodic and current reports filed with the Securities Exchange Commission by Golden Minerals Company, including the Company's Annual Report on Form 10-K for the year ended December 31, 2013.

Golden Minerals Company
Karen Winkler
Director of Investor Relations
(303) 839-5060
[email protected]

 

GOLDEN MINERALS COMPANY

CONSOLIDATED BALANCE SHEETS

(Expressed in United States dollars)

(Unaudited)






June 30,


December 31,





2014


2013





(in thousands, except share data)

Assets





Current assets






Cash and cash equivalents 


$  10,400


$         19,146


Trade receivables


-


25


Inventories 


384


449


Value added tax receivable, net 


1,775


1,765


Prepaid expenses and other assets 


923


1,091



Total current assets


13,482


22,476

Property, plant and equipment, net 


30,639


32,375

Prepaid expenses and other assets, non-current 


-


30



Total assets


$  44,121


$         54,881

Liabilities and Equity





Current liabilities






Accounts payable and other accrued liabilities 


$     1,747


$           1,365


Other current liabilities 


3,488


4,405



Total current liabilities


5,235


5,770

Asset retirement obligation 


2,589


2,602

Other long term liabilities


74


53



Total liabilities


7,898


8,425








Commitments and contingencies 





Equity 






Common stock, $.01 par value,







100,000,000 shares authorized; 43,530,833 shares issued and outstanding for both periods 


435


435


Additional paid in capital


495,115


494,647


Accumulated deficit 


(459,327)


(448,626)



Shareholder's equity 


36,223


46,456



Total liabilities and equity 


$  44,121


$         54,881








 


GOLDEN MINERALS COMPANY

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(Expressed in United States dollars) (Unaudited)






Three Months Ended


Six Months Ended





June 30,


June 30,





2014


2013


2014


2013





(in thousands, except share data)




Revenue:










Sale of metals 


$               -


$         4,467


$                -


$       10,297

Costs and expenses:










Costs applicable to sale of metals (exclusive 











of depreciation shown below) 


-


(8,145)


-


(17,017)


Exploration expense


(1,653)


(1,240)


(3,253)


(2,764)


El Quevar project expense


(421)


(586)


(755)


(1,673)


Velardena project expense


-


(759)


-


(2,921)


Velardena shutdown and care & maintenance costs

(1,208)


(2,329)


(2,457)


(2,329)


Administrative expense


(1,150)


(1,633)


(2,805)


(3,530)


Stock based compensation


(257)


(558)


(587)


(979)


Reclamation and accretion expense


(49)


(46)


(98)


(88)


Impairment of long lived assets


-


(238,020)


-


(238,020)


Impairment of goodwill


-


(11,180)


-


(11,180)


Other operating income, net


2


630


4


3,828


Depreciation, depletion and amortization


(778)


(2,529)


(1,624)


(5,097)



Total costs and expenses


(5,514)


(266,395)


(11,575)


(281,770)


Loss from operations


(5,514)


(261,928)


(11,575)


(271,473)

Other income and (expense):










Interest and other income, net


487


251


881


323


Gain on foreign currency


(16)


(1,145)


(7)


(410)



Total other income (expense)


471


(894)


874


(87)


Loss from operations before income taxes


(5,043)


(262,822)


(10,701)


(271,560)


Income tax benefit


-


45,017


-


47,495


Net loss


$       (5,043)


$   (217,805)


$     (10,701)


$   (224,065)

Comprehensive loss:










Unrealized gain on securities


-


-


-


90


Comprehensive loss


$       (5,043)


$   (217,805)


$     (10,701)


$   (223,975)

Net loss per common share – basic










Loss


$         (0.12)


$          (5.09)


$          (0.25)


$          (5.23)

Weighted average common stock outstanding - basic (1)


42,918,426


42,821,914


42,906,090


42,812,918












(1)  Potentially dilutive shares have not been included because to do so would be anti-dilutive.

Logo - http://photos.prnewswire.com/prnh/20120803/LA52082LOGO

SOURCE Golden Minerals Company

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
"We analyze the video streaming experience. We are gathering the user behavior in real time from the user devices and we analyze how users experience the video streaming," explained Eric Kim, Founder and CEO at Streamlyzer, in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
In his session at Cloud Expo, Robert Cohen, an economist and senior fellow at the Economic Strategy Institute, provideed economic scenarios that describe how the rapid adoption of software-defined everything including cloud services, SDDC and open networking will change GDP, industry growth, productivity and jobs. This session also included a drill down for several industries such as finance, social media, cloud service providers and pharmaceuticals.
Extracting business value from Internet of Things (IoT) data doesn’t happen overnight. There are several requirements that must be satisfied, including IoT device enablement, data analysis, real-time detection of complex events and automated orchestration of actions. Unfortunately, too many companies fall short in achieving their business goals by implementing incomplete solutions or not focusing on tangible use cases. In his general session at @ThingsExpo, Dave McCarthy, Director of Products...
@DevOpsSummit at Cloud taking place June 6-8, 2017, at Javits Center, New York City, is co-located with the 20th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. The widespread success of cloud computing is driving the DevOps revolution in enterprise IT. Now as never before, development teams must communicate and collaborate in a dynamic, 24/7/365 environment. There is no time to wait for long developm...
Businesses and business units of all sizes can benefit from cloud computing, but many don't want the cost, performance and security concerns of public cloud nor the complexity of building their own private clouds. Today, some cloud vendors are using artificial intelligence (AI) to simplify cloud deployment and management. In his session at 20th Cloud Expo, Ajay Gulati, Co-founder and CEO of ZeroStack, will discuss how AI can simplify cloud operations. He will cover the following topics: why clou...
SYS-CON Events has announced today that Roger Strukhoff has been named conference chair of Cloud Expo and @ThingsExpo 2017 New York. The 20th Cloud Expo and 7th @ThingsExpo will take place on June 6-8, 2017, at the Javits Center in New York City, NY. "The Internet of Things brings trillions of dollars of opportunity to developers and enterprise IT, no matter how you measure it," stated Roger Strukhoff. "More importantly, it leverages the power of devices and the Internet to enable us all to im...
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo 2016 in New York. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place June 6-8, 2017, at the Javits Center in New York City, New York, is co-located with 20th Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry p...
Kubernetes is a new and revolutionary open-sourced system for managing containers across multiple hosts in a cluster. Ansible is a simple IT automation tool for just about any requirement for reproducible environments. In his session at @DevOpsSummit at 18th Cloud Expo, Patrick Galbraith, a principal engineer at HPE, discussed how to build a fully functional Kubernetes cluster on a number of virtual machines or bare-metal hosts. Also included will be a brief demonstration of running a Galera MyS...
Internet-of-Things discussions can end up either going down the consumer gadget rabbit hole or focused on the sort of data logging that industrial manufacturers have been doing forever. However, in fact, companies today are already using IoT data both to optimize their operational technology and to improve the experience of customer interactions in novel ways. In his session at @ThingsExpo, Gordon Haff, Red Hat Technology Evangelist, will share examples from a wide range of industries – includin...
"We build IoT infrastructure products - when you have to integrate different devices, different systems and cloud you have to build an application to do that but we eliminate the need to build an application. Our products can integrate any device, any system, any cloud regardless of protocol," explained Peter Jung, Chief Product Officer at Pulzze Systems, in this SYS-CON.tv interview at @ThingsExpo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Keeping pace with advancements in software delivery processes and tooling is taxing even for the most proficient organizations. Point tools, platforms, open source and the increasing adoption of private and public cloud services requires strong engineering rigor – all in the face of developer demands to use the tools of choice. As Agile has settled in as a mainstream practice, now DevOps has emerged as the next wave to improve software delivery speed and output. To make DevOps work, organization...
Get deep visibility into the performance of your databases and expert advice for performance optimization and tuning. You can't get application performance without database performance. Give everyone on the team a comprehensive view of how every aspect of the system affects performance across SQL database operations, host server and OS, virtualization resources and storage I/O. Quickly find bottlenecks and troubleshoot complex problems.
Internet of @ThingsExpo has announced today that Chris Matthieu has been named tech chair of Internet of @ThingsExpo 2017 New York The 7th Internet of @ThingsExpo will take place on June 6-8, 2017, at the Javits Center in New York City, New York. Chris Matthieu is the co-founder and CTO of Octoblu, a revolutionary real-time IoT platform recently acquired by Citrix. Octoblu connects things, systems, people and clouds to a global mesh network allowing users to automate and control design flo...
"We are an all-flash array storage provider but our focus has been on VM-aware storage specifically for virtualized applications," stated Dhiraj Sehgal of Tintri in this SYS-CON.tv interview at 19th Cloud Expo, held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA.
Unless your company can spend a lot of money on new technology, re-engineering your environment and hiring a comprehensive cybersecurity team, you will most likely move to the cloud or seek external service partnerships. In his session at 18th Cloud Expo, Darren Guccione, CEO of Keeper Security, revealed what you need to know when it comes to encryption in the cloud.