Click here to close now.



Welcome!

News Feed Item

Elgin Mining Reports Second Quarter 2014 Results

VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 08/12/14 -- Elgin Mining Inc. ("Elgin Mining" or the "Company") (TSX:ELG) reports its financial and operational results for three and six months ended June 30, 2014. Elgin Mining owns and operates the Bjorkdal gold mine ("Bjorkdal Mine") in Sweden, and holds the past-producing Lupin gold mine ("Lupin") and the Ulu gold property in Nunavut, Canada. All figures are in United States dollars ($ or USD) unless otherwise indicated.

A copy of the Company's financial statements and Management's Discussion and Analysis ("MD&A") can be viewed on the Company's website at www.elginmining.com or on SEDAR at www.sedar.com.

Second Quarter 2014 Financial and Operational Highlights


--  Gold production of 12,098 ounces, an increase of 12% from first quarter
    gold production of 10,812 ounces; 
--  Cash cost of $993 and all-in sustaining cost ("AISC") of $1,197 per gold
    ounce produced;  
--  Cash cost of $1,009 and AISC of $1,214 per gold ounce sold; 
--  Cash flow from operating activities was $3.4 million, which decreases to
    $2.5 million when non-cash working capital movements are excluded; 
--  Cash improved by $1.5 million during the quarter after debt repayments
    of $0.3 million; 
--  Open pit ("OP") operations performed well in the quarter with head
    grades remaining strong and above plan due to the Company's continuing
    grade control programs and mine planning efforts; 
--  Underground ("UG") operations have improved from the previous quarter
    with an increase in both UG head grades and gold production from the
    previous quarter's results. However, UG head grades, ore production and
    unit mining costs remained below target for the quarter as results were
    impacted by repairs to mobile equipment used in stoping activities, and
    from challenging ground conditions which resulted in delays in full
    production from one of the main stope areas, which have now been
    rectified. Higher labour and equipment productivity, and better head
    grades are predicted for the last half of 2014 as the Company continues
    to resolve these issues over the third quarter; 
--  The process plant continues to operate well with minimal stoppages and
    sustained increased daily throughput without any loss in the plant's
    metallurgical recovery rate due to improvements made to the plant's
    flotation and other circuits since the start of the year; and 
--  Permit application to expand the plant's annual throughput limit from
    1.3 million tonnes to 1.5 million tonnes was filed in late May 2014 with
    receipt of the expansion permit anticipated by the end of 2014. 

Re-affirmation of Bjorkdal Mine 2014 Guidance

Gold production in H1-2014 totalled 22,910 ounces at a per ounce cash cost of $1,019 and per ounce AISC of $1,237 on a gold produced basis.

The Company anticipates increased UG gold production in the second half of 2014 from improved labour and equipment productivity, and from higher head grades as ground and sequencing issues experienced in the first half of the year are rectified. These changes will lead to lower per tonne operating costs and along with a weaker Swedish krona ("SEK"), will have a positive effect on the Company's reported gold production costs for the last half of 2014.

Specifically, all of the Bjorkdal Mine's gold production costs are denominated in SEK except for off-site treatment and refining charges and corporate administration costs which are denominated in Euros and Canadian dollars, respectively. As of August 12, 2014, the SEK per USD exchange rate stood at 6.88, a 5.5% drop from the exchange rate assumption of 6.50 used in the Company's 2014 guidance below.

The Company's 2014 guidance for gold production and unit cash cost remain as follows:


----------------------------------------------------------------------------
2014 Gold Production Guidance        Production Low-end  Production High-end
----------------------------------------------------------------------------
Gold production (ounces)                   44,000              49,000       
----------------------------------------------------------------------------
Cash cost per gold ounce produced                                           
 (USD/ounce)                                $982                $886        
----------------------------------------------------------------------------
AISC per gold ounce produced                                                
 (USD/ounce)                               $1,227              $1,106       
----------------------------------------------------------------------------
AISC per gold ounce produced                                                
 excluding non-cash accretion and                                           
 share-based payment expense                                                
 (USD/ounce)                               $1,207              $1,088       
----------------------------------------------------------------------------
Sustaining capital (USD)                $7.9 million        $7.9 million    
----------------------------------------------------------------------------
SEK per USD FX rate assumption              6.50                6.50        
----------------------------------------------------------------------------
CAD per USD FX rate assumption              1.10                1.10        
----------------------------------------------------------------------------

The above AISC guidance includes all capital expenditures (including capitalized exploration) expected to be incurred at the Bjorkdal Mine for 2014, and all general and administration costs incurred at the Company's corporate office in Canada.

Management forecasts that full year gold production will be at the high end of the range while AISC per gold ounce produced will be at the low-end of the range provided. Production in the third quarter to August 11, 2014 totalled 5,232 gold ounces which included the processing of 33,508 tonnes of lower-grade stockpiled ore (approximately 22% of plant ore feed for the quarter-to-date) in July 2014. In Sweden, July is an important vacation month for both staff and contractors, resulting in reduced OP and UG mining activities. Despite that, July production was well above budget.

Patrick Downey, President and CEO, commented, "We are pleased that the Bjorkdal Mine had another positive quarter of generating net free cash flow resulting from strong quarterly gold production, improvements in head grades, and tight control over costs. The plant and open pit are performing very well and we expect this performance to continue for the remainder of 2014. Underground production and grades should see significant improvement in the second half now that the temporary issues concerning equipment availability and ore dilution are addressed.

"We also announced the proposed acquisition of the Company by Mandalay Resources Corporation and anticipate that the closing of the arrangement will occur on or around September 10, 2014, assuming the requisite shareholder and regulatory approvals are received. The Mandalay team has demonstrated an excellent track record of unlocking immense value on under-capitalized and under-explored gold operations, and we are convinced that they will do the same for the Bjorkdal Mine for the mutual benefit of both companies' stakeholders."

Second Quarter and First Half 2014 Financial and Operational Summaries


                          For the       For the                             
                            three         three   For the six   For the six 
                           months        months        months        months 
                            ended         ended         ended         ended 
                         June 30,      June 30,      June 30,      June 30, 
                             2014          2013          2014          2013 
----------------------------------------------------------------------------
FINANCIAL DATA                                                              
Revenue              $ 15,257,878  $ 13,989,813  $ 30,141,973  $ 30,591,472 
Production costs,                                                           
 excluding                                                                  
 depreciation and                                                           
 depletion           $ 11,006,973  $ 14,005,564  $ 21,542,123  $ 27,201,178 
Income (loss) from                                                          
 mining operations   $  2,208,543  $ (2,915,413) $  3,265,252  $ (1,963,928)
Exploration expense  $     33,260  $    193,816  $     36,199  $    316,698 
Corporate                                                                   
 administration      $    645,431  $  1,663,793  $  1,322,140  $  2,939,236 
Lupin care and                                                              
 maintenance         $    425,979  $  1,190,730  $    816,697  $  3,675,925 
Coal reclamation                                                            
 costs               $          -  $     60,844  $  7,801,733  $     60,844 
Net loss             $    (71,056) $(10,353,917) $ (8,486,750) $(13,923,762)
Net loss per share   $          -                                           
- Basic              $      (0.00) $      (0.07) $      (0.05) $      (0.09)
- Diluted            $      (0.00) $      (0.07) $      (0.05) $      (0.09)
Cash flow provided by                                                       
 operating activities$  3,368,874  $  1,828,034  $  5,375,041  $   (944,360)
Cash and cash                                                               
 equivalents         $ 13,969,737  $  7,777,509  $ 13,969,737  $  7,777,509 
Working capital      $  3,633,476  $  8,162,212  $  3,633,476  $  8,162,212 
Long-term debt, non-                                                        
 current             $  2,663,847  $  3,027,210  $  2,663,847  $  3,027,210 
Capital expenditures $  1,738,489  $  8,975,881  $  3,547,399  $ 11,755,824 
----------------------------------------------------------------------------
                                                                            
----------------------------------------------------------------------------
OPERATING DATA                                                              
Gold ounces produced       12,098        12,343        22,910        22,377 
Gold ounces sold           12,027        11,945        23,163        22,589 
Average realized gold                                                       
 price (USD per                                                             
 ounce)              $      1,316  $      1,219  $      1,348  $      1,409 
Cash cost per gold                                                          
 ounce sold (USD per                                                        
 ounce)(1)           $      1,009  $      1,194  $        972  $      1,218 
All-in sustaining                                                           
 cost per gold ounce                                                        
 sold (USD per                                                              
 ounce)(1)           $      1,214  $      1,841  $      1,187  $      1,729 
Cash cost per gold                                                          
 ounce produced (USD                                                        
 per ounce)(1)       $        993  $      1,129  $      1,019  $      1,226 
All-in sustaining                                                           
 cost per gold ounce                                                        
 produced (USD per                                                          
 ounce)(1)           $      1,197  $      1,755  $      1,237  $      1,743 
----------------------------------------------------------------------------

(1) Refer to page 13 of the Company's MD&A for additional details on non-IFRS measures

Elgin Mining Inc.

Elgin Mining is a Canadian based company focused on production at the Bjorkdal gold mine in Sweden. In addition, Elgin Mining's portfolio includes the Lupin and Ulu gold projects located in Nunavut, Canada.

For further information, please visit the Company's web site at www.elginmining.com.

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of securities legislation and which are based on the expectations, estimates and projections of management of Elgin as of the date of this news release unless otherwise stated. Forward-looking statements are generally identifiable by use of the words "expect," "anticipate," "continue," "estimate," "objective," "ongoing," "may," "will," "project," "should," "believe," "plans," "intends" or the negative of these words or other variations on these words or comparable terminology. More particularly, and without limitation, this news release contains forward-looking statements and information concerning expectations regarding the consideration to be issued pursuant to the transaction, the ability of Elgin to consummate the transaction on the terms and in the manner contemplated thereby and the expected timing of the closing of the Arrangement. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, the time required to prepare and mail meeting materials to Elgin shareholders, the ability of the parties to receive, in a timely manner and on satisfactory terms, the necessary court, shareholder, stock exchange and regulatory approvals and the ability of the parties to satisfy, in a timely manner, the conditions to the closing of the transaction, as well as other uncertainties and risk factors set out in filings made from time to time by Elgin with the Canadian securities regulators, including, without limitation, Elgin's annual information form dated March 21, 2014, which is available on SEDAR at www.sedar.com. Actual results, developments and timetables could vary significantly from the estimates presented. Readers are cautioned not to put undue reliance on forward-looking statements.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
As enterprises work to take advantage of Big Data technologies, they frequently become distracted by product-level decisions. In most new Big Data builds this approach is completely counter-productive: it presupposes tools that may not be a fit for development teams, forces IT to take on the burden of evaluating and maintaining unfamiliar technology, and represents a major up-front expense. In his session at @BigDataExpo at @ThingsExpo, Andrew Warfield, CTO and Co-Founder of Coho Data, will dis...
SYS-CON Events announced today that Fusion, a leading provider of cloud services, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Fusion, a leading provider of integrated cloud solutions to small, medium and large businesses, is the industry's single source for the cloud. Fusion's advanced, proprietary cloud service platform enables the integration of leading edge solutions in the cloud, including clou...
As someone who has been dedicated to automation and Application Release Automation (ARA) technology for almost six years now, one of the most common questions I get asked regards Platform-as-a-Service (PaaS). Specifically, people want to know whether release automation is still needed when a PaaS is in place, and why. Isn't that what a PaaS provides? A solution to the deployment and runtime challenges of an application? Why would anyone using a PaaS then need an automation engine with workflow ...
With the Apple Watch making its way onto wrists all over the world, it’s only a matter of time before it becomes a staple in the workplace. In fact, Forrester reported that 68 percent of technology and business decision-makers characterize wearables as a top priority for 2015. Recognizing their business value early on, FinancialForce.com was the first to bring ERP to wearables, helping streamline communication across front and back office functions. In his session at @ThingsExpo, Kevin Roberts...
SYS-CON Events announced today that Commvault, a global leader in enterprise data protection and information management, has been named “Bronze Sponsor” of SYS-CON's 18th International Cloud Expo, which will take place on June 7–9, 2016, at the Javits Center in New York City, NY, and the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Commvault is a leading provider of data protection and information management...
Your business relies on your applications and your employees to stay in business. Whether you develop apps or manage business critical apps that help fuel your business, what happens when users experience sluggish performance? You and all technical teams across the organization – application, network, operations, among others, as well as, those outside the organization, like ISPs and third-party providers – are called in to solve the problem.
SYS-CON Events announced today that Alert Logic, Inc., the leading provider of Security-as-a-Service solutions for the cloud, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Alert Logic, Inc., provides Security-as-a-Service for on-premises, cloud, and hybrid infrastructures, delivering deep security insight and continuous protection for customers at a lower cost than traditional security solutions. Ful...
@DevOpsSummit taking place June 7-9, 2016 at Javits Center, New York City, and Nov 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with the 18th International @CloudExpo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world. @DevOpsSummit at Cloud Expo New York Call for Papers is now open.
SYS-CON Events announced today that VAI, a leading ERP software provider, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. VAI (Vormittag Associates, Inc.) is a leading independent mid-market ERP software developer renowned for its flexible solutions and ability to automate critical business functions for the distribution, manufacturing, specialty retail and service sectors. An IBM Premier Business Part...
SYS-CON Events announced today that Catchpoint Systems, Inc., a provider of innovative web and infrastructure monitoring solutions, has been named “Silver Sponsor” of SYS-CON's DevOps Summit at 18th Cloud Expo New York, which will take place June 7-9, 2016, at the Javits Center in New York City, NY. Catchpoint is a leading Digital Performance Analytics company that provides unparalleled insight into customer-critical services to help consistently deliver an amazing customer experience. Designed...
Let’s face it, embracing new storage technologies, capabilities and upgrading to new hardware often adds complexity and increases costs. In his session at 18th Cloud Expo, Seth Oxenhorn, Vice President of Business Development & Alliances at FalconStor, will discuss how a truly heterogeneous software-defined storage approach can add value to legacy platforms and heterogeneous environments. The result reduces complexity, significantly lowers cost, and provides IT organizations with improved effi...
SYS-CON Events announced today that Pythian, a global IT services company specializing in helping companies adopt disruptive technologies to optimize revenue-generating systems, has been named “Bronze Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2015 at the Javits Center in New York, New York. Founded in 1997, Pythian is a global IT services company that helps companies compete by adopting disruptive technologies such as cloud, Big Data, advanced analytics, and DevO...
SYS-CON Events announced today that Men & Mice, the leading global provider of DNS, DHCP and IP address management overlay solutions, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. The Men & Mice Suite overlay solution is already known for its powerful application in heterogeneous operating environments, enabling enterprises to scale without fuss. Building on a solid range of diverse platform support,...
One of the bewildering things about DevOps is integrating the massive toolchain including the dozens of new tools that seem to crop up every year. Part of DevOps is Continuous Delivery and having a complex toolchain can add additional integration and setup to your developer environment. In his session at @DevOpsSummit at 18th Cloud Expo, Miko Matsumura, Chief Marketing Officer of Gradle Inc., will discuss which tools to use in a developer stack, how to provision the toolchain to minimize onboa...
The cloud promises new levels of agility and cost-savings for Big Data, data warehousing and analytics. But it’s challenging to understand all the options – from IaaS and PaaS to newer services like HaaS (Hadoop as a Service) and BDaaS (Big Data as a Service). In her session at @BigDataExpo at @ThingsExpo, Hannah Smalltree, a director at Cazena, will provide an educational overview of emerging “as-a-service” options for Big Data in the cloud. This is critical background for IT and data profes...