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
What sort of WebRTC based applications can we expect to see over the next year and beyond? One way to predict development trends is to see what sorts of applications startups are building. In his session at @ThingsExpo, Arin Sime, founder of WebRTC.ventures, will discuss the current and likely future trends in WebRTC application development based on real requests for custom applications from real customers, as well as other public sources of information,
SYS-CON Events announced today that SoftLayer, an IBM Company, has been named “Gold Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York, New York. SoftLayer, an IBM Company, provides cloud infrastructure as a service from a growing number of data centers and network points of presence around the world. SoftLayer’s customers range from Web startups to global enterprises.
SYS-CON Events announced today that Ocean9will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Ocean9 provides cloud services for Backup, Disaster Recovery (DRaaS) and instant Innovation, and redefines enterprise infrastructure with its cloud native subscription offerings for mission critical SAP workloads.
Have you ever noticed how some IT people seem to lead successful, rewarding, and satisfying lives and careers, while others struggle? IT author and speaker Don Crawley uncovered the five principles that successful IT people use to build satisfying lives and careers and he shares them in this fast-paced, thought-provoking webinar. You'll learn the importance of striking a balance with technical skills and people skills, challenge your pre-existing ideas about IT customer service, and gain new in...
SYS-CON Events announced today that Juniper Networks (NYSE: JNPR), an industry leader in automated, scalable and secure networks, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Juniper Networks challenges the status quo with products, solutions and services that transform the economics of networking. The company co-innovates with customers and partners to deliver automated, scalable and secure network...
Interoute has announced the integration of its Global Cloud Infrastructure platform with Rancher Labs’ container management platform, Rancher. This approach enables enterprises to accelerate their digital transformation and infrastructure investments. Matthew Finnie, Interoute CTO commented “Enterprises developing and building apps in the cloud and those on a path to Digital Transformation need Digital ICT Infrastructure that allows them to build, test and deploy faster than ever before. The int...
In his session at @ThingsExpo, Eric Lachapelle, CEO of the Professional Evaluation and Certification Board (PECB), will provide an overview of various initiatives to certifiy the security of connected devices and future trends in ensuring public trust of IoT. Eric Lachapelle is the Chief Executive Officer of the Professional Evaluation and Certification Board (PECB), an international certification body. His role is to help companies and individuals to achieve professional, accredited and worldw...
VeriStor Systems has announced that CRN has named VeriStor to its 2017 Managed Service Provider (MSP) 500 list in the Elite 150 category. This annual list recognizes North American solution providers with cutting-edge approaches to delivering managed services. Their offerings help companies navigate the complex and ever-changing landscape of IT, improve operational efficiencies, and maximize their return on IT investments. In today’s fast-paced business environments, MSPs play an important role...
DevOps is often described as a combination of technology and culture. Without both, DevOps isn't complete. However, applying the culture to outdated technology is a recipe for disaster; as response times grow and connections between teams are delayed by technology, the culture will die. A Nutanix Enterprise Cloud has many benefits that provide the needed base for a true DevOps paradigm. In his Day 3 Keynote at 20th Cloud Expo, Chris Brown, a Solutions Marketing Manager at Nutanix, will explore t...
What if you could build a web application that could support true web-scale traffic without having to ever provision or manage a single server? Sounds magical, and it is! In his session at 20th Cloud Expo, Chris Munns, Senior Developer Advocate for Serverless Applications at Amazon Web Services, will show how to build a serverless website that scales automatically using services like AWS Lambda, Amazon API Gateway, and Amazon S3. We will review several frameworks that can help you build serverle...
SYS-CON Events announced today that Linux Academy, the foremost online Linux and cloud training platform and community, will exhibit at SYS-CON's 20th International Cloud Expo®, which will take place on June 6-8, 2017, at the Javits Center in New York City, NY. Linux Academy was founded on the belief that providing high-quality, in-depth training should be available at an affordable price. Industry leaders in quality training, provided services, and student certification passes, its goal is to c...
SYS-CON Events announced today that Interoute, owner-operator of one of Europe's largest networks and a global cloud services platform, has been named “Bronze Sponsor” of SYS-CON's 20th Cloud Expo, which will take place on June 6-8, 2017 at the Javits Center in New York, New York. Interoute is the owner-operator of one of Europe's largest networks and a global cloud services platform which encompasses 12 data centers, 14 virtual data centers and 31 colocation centers, with connections to 195 add...
SYS-CON Events announced today that Telecom Reseller has been named “Media Sponsor” of SYS-CON's 20th International Cloud Expo, which will take place on June 6–8, 2017, at the Javits Center in New York City, NY. Telecom Reseller reports on Unified Communications, UCaaS, BPaaS for enterprise and SMBs. They report extensively on both customer premises based solutions such as IP-PBX as well as cloud based and hosted platforms.
FinTech is the sum of financial and technology, and it’s one of the fastest growing tech industries. Total global investments in FinTech almost reached $50 billion last year, but there is still a great deal of confusion over what it is and what it means – especially as it applies to retirement. Building financial startups is not simple, but with the right team, technology and an innovative approach it can be an extremely interesting domain to disrupt. FinTech heralds a financial revolution that...
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...