Click here to close now.

SYS-CON MEDIA Authors: Liz McMillan, Dana Gardner, Elizabeth White, Carmen Gonzalez, PagerDuty Blog

News Feed Item

Gran Colombia Gold announces third quarter 2012 results with production of 26,912 ounces of gold

TORONTO, Nov. 12, 2012 /PRNewswire/ - Gran Colombia Gold Corp. (TSX: GCM) announced today the release of its unaudited interim condensed consolidated financial statements for the third quarter ended September 30, 2012 and accompanying management's discussion and analysis. All financial figures contained herein are expressed in U.S. dollars unless otherwise noted.

Third Quarter 2012 Highlights

  • Gold production of 26,912 ounces in the third quarter of 2012 represented a 24% improvement over the same quarter last year bringing total gold production for the first nine months of 2012 to 78,779 ounces, up 22% over the first nine months of last year. The Company continued to make progress at its Segovia Operations, increasing mill throughput at Maria Dama to an average of 891 tonnes per day ("tpd") in the third quarter of 2012, a 61% increase compared with the first half of 2012. In September, the Company reached its objective as mill throughput averaged 1,066 tpd, including several days when it was stress tested with throughput greater than 1,300 tpd. Four new flotation cells have also been installed as part of the plant upgrade and the final two new flotation cells will be completed shortly. Capital development activities continued at the Providencia and Sandra K mines and the mine contractor continues de-watering to open up access to lower levels at the El Silencio mine. Segovia's gold production in the third quarter of 21,114 ounces was impacted by lower than normal grades due to the temporary depletion of higher grade zones in the levels being mined and the processing of lower grade stockpiles in the ramp up of the new mill. Grades are expected to return to historical levels at Segovia as the new mining areas are opened up in the fourth quarter. At Marmato Underground, grades improved in the third quarter as expected, resulting in gold production of 5,798 ounces for the quarter.
  • Revenues for the third quarter of 2012 of $47.1 million, 21% higher than the third quarter last year, brought total revenues for the first nine months of 2012 to $130.5 million. The Company sold 77,241 ounces of gold at an average realized price of $1,647 per ounce in the first nine months of 2012.
  • Cash costs showed improvement at both Segovia and Marmato Underground in the third quarter of 2012 compared to the second quarter this year. At Segovia, cash costs decreased by $32 per ounce to $1,288 in the third quarter, and would have been below $1,200 per ounce if not for the lower head grades encountered in the third quarter. At Marmato Underground, the improvement in grades reduced cash costs by $114 per ounce to $1,174 per ounce in the third quarter. Overall, with an average realized gold price of $1,642 per ounce and a combined cash cost of $1,261 per ounce, the Company generated cash flow of $381 per ounce or $10.8 million from its production in the third quarter of 2012.
  • General and administrative expenses of $4.1 million for the third quarter of 2012 included additional expenses incurred to expedite the collection of overdue VAT claims in Colombia, an increased level of initiatives being undertaken in the quarter and care and maintenance costs and legal fees associated with the Mazamorras and Mali properties, both of which are in the process of being wound down.
  • Net loss attributable to shareholders of $0.7 million, or $0.00 per share, in the third quarter of 2012, compared to a net loss of $5.9 million, or $0.02 per share, in the third quarter of 2011.
  • Cash balance at September 30, 2012 was $1.6 million.  During the third quarter of 2012, the Company used $2.5 million of its cash on hand, together with $0.6 million generated from operating activities and $4.9 million of net proceeds from additional Colombian bank debt facilities to fund $7.9 million of investing activities during the quarter.
  • Expansion of the Company's Segovia Operations gained momentum on October 30, 2012, when the Company closed a $100 million, senior secured 10% gold-linked notes financing.
  • Exploration highlights included the announcement, on October 10, 2012, of the best results the Company has seen thus far in the deep zone mineralization at the Marmato Project, including 1.6 grams per tonne of gold over 618 meters of drilling, with 16.9 meters with 35.2 grams per tonne of gold and a 1.8 meter section containing 159 grams per tonne of gold.  This indication of a second zone of mineralization, well below the current estimated lower limit of the open pit option, forming a deep body that could be suitable for underground mining. The Company expects to complete the prefeasibility study for the Marmato Project by the end of this year.  Also in October, the Company commenced a 51,000 meter exploration program to upgrade and expand the Company's resources at its Segovia Operations.
  • The company has commenced a process to identify other potential acquirers or joint venture partners for the Mazamorras Project as the previously announced agreement was not completed by the acquiring company as agreed.

Effective November 1, 2012, the Company is pleased to announce the appointment of Gabriel Gaviria as Vice President of Mining for Gran Colombia Gold.  In his previous position, Mr. Gaviria managed all aspects of the Company's underground mining operations at Marmato.  In his new capacity, Mr. Gaviria will bring his considerable experience in cost control, mine planning and operations management to focus on the Segovia Operations, including the expansion project which is now getting underway.

Commenting on the Company's progress in the third quarter of 2012, Serafino Iacono, Executive Co-Chairman of Gran Colombia commented said "We are pleased to have received the financial support of our existing and new shareholders to fund the expansion and modernization of our Segovia Operations.  With the financing in place, we must now focus on completing the new Segovia expansion project on time and on budget.  Combined with the new management focus that Mr. Gaviria's appointment brings to our existing Segovia Operations, we must ensure that we redouble our efforts to deliver on our commitments to our shareholders."

Financial and Operating Summary

A summary of the financial and operating results for the third quarter of 2012 is as follows:

  Q3 2012   Q3 2011   YTD 2012   YTD 2011
Operating data:              
Gold produced (ounces) 26,912   21,727   78,779   54,501
Gold sold (ounces) 28,009   22,317   77,241   54,624
Average realized gold price ($/oz sold) $ 1,642   $ 1,684   $ 1,647   $ 1,547
Total cash costs ($/oz sold) (1) $ 1,261   $ 1,340   $ 1,258   $ 1,352
Financial data:   ($000's, except per share amounts)              
Total revenues $ 47,070   $ 38,779   $ 130,485   $   87,288
Gross margin (2) $ 6,101   $ 1,862   $17,729   ($ 1,704)
Net loss attributable to shareholders ($ 724)   ($ 5,910)   ($ 13,320)   ($ 36,486)
Basic and diluted loss per share $0.00   ($0.02)   ($0.03)   ($0.13)
Cash and cash equivalents $ 1,604   $ 58,608   $ 1,604   $ 58,608
Total debt, including current portion $ 88,185   $ 78,557   $ 88,185   $ 78,557

  (1)      "Total cash costs" are presented on a per ounce sold basis and represent consolidated
averages for the Company from both the Segovia Operations and Marmato Underground
mine.  See "Additional Financial Measures".
  (2)      "Gross margin" represents total revenues, net of operating costs, production taxes and
depreciation, depletion and amortization.

Segovia Operations Update

In the third quarter of 2012, production at the Segovia Operations totalled 21,114 ounces of gold with an average daily processing rate of 891 tpd, compared to 20,610 ounces of gold with an average daily processing rate of 591 tpd in the second quarter of 2012.

The Company is in the final stages of upgrading the Maria Dama plant to achieve a maximum capacity of 1,500 tpd by early 2013.  In September 2012, the Company reached its objective of processing 1,000 tpd, double the historical processing rate at Maria Dama. The new ball mill came on-line in mid-May and the second phase of the plant upgrade got underway in the third quarter with the installation of six new flotation cells, the first four of which are now in operation and the remaining two should be completed in the fourth quarter. Four new cyanidation tanks are also now in operation. While these new flotation cells were being installed, the Company limited mill throughput to approximately 800 to 900 tpd to maintain mill recovery rates between 80% and 85% and then in September, utilizing approximately 2,600 tonnes of material from low-grade stockpiles, increased throughput to an average of 1,066 tpd for the month, including several days where the plant was stress tested with throughput in excess of 1,300 tpd. Processing rates have been maintained at 1,000 tpd in October.

Historically, grades at Segovia, one of the top ten producing mines by grade in the world(1), have averaged in the range of 12 to 14 g/t. However, in the third quarter of 2012, grades averaged approximately 9.5 g/t due to the temporary depletion of higher grade zones in the levels currently being mined at Providencia and El Silencio and, to a lesser extent, the processing of some lower grade stockpiles. At Providencia, where mining activity is being conducted on Level 11, capital development is in process to open up access to higher grade areas on Level 12 that will commence mining in the fourth quarter. Similarly, at El Silencio, the mine contractor is currently working between Levels 18 and 24, where the extra high grade sections (ie greater than 50 g/t) are now depleted and material ranges between 10 and 40 g/t. De-watering activity by the mine contractor, currently down to Level 27, continues but the pumping process is being slowed by depth, taking approximately 45 days to pump each level. As the mine contractor is able to start accessing Levels 24 to 29 over the next few months, grades from El Silencio's gold production will also improve through the inclusion of the extra high grade material.

(1)      Source: NRH Research, Global Gold Mines & Deposits 2012 (publicly traded companies with deposits greater than one million ounces in all resources categories)

Marmato Project Update

In the third quarter of 2012, production at Marmato Underground totalled 5,798 ounces of gold and 9,684 ounces of silver, with an average daily processing rate of 765 tpd, compared to 4,997 ounces of gold and 8,016 ounces of silver, with an average daily processing rate of 740 tpd in the second quarter of 2012.  As expected, head grades improved to approximately 2.9 g/t in the third quarter.

Outlook

With the Maria Dama plant now operating at 1,000 tpd, grades will be the determining factor in the final production result for the Segovia Operations for 2012, which is likely to be 85,000 to 90,000 ounces of gold. The Company continues to expect production from the underground mine at Marmato to total approximately 23,000 ounces of gold, resulting in expected total production for the Company of between 108,000 and 113,000 ounces of gold for the full year of 2012, an increase of between 18% and 24% over 2011.

The Company's longer term plan remains on track to reach a production rate of 200,000 ounces of gold annually at its Segovia Operations by 2014.

Webcast

As a reminder, the Company will host a conference call and webcast on Tuesday, November 13, 2012 at 9:00 a.m. Eastern Time (9:00 a.m. Bogota time) to discuss the results and provide an operational update.

Webcast and call-in details are as follows:

Live Event link:        http:/www.media-server.com/m/p/5utqtq6x
Toronto & International:     1 (847) 585-4405
North America Toll Free:     1 (888) 771-4371
Colombia Toll Free:       01 800 9 156 924
Conference ID:        33575587

A replay of the webcast will be available at www.grancolombiagold.com from Tuesday, November 13, 2012 until Thursday, December 13, 2012.

About Gran Colombia Gold

Gran Colombia is a Canadian-based gold and silver exploration, development and production company with its primary focus in Colombia. Gran Colombia is currently the largest underground gold and silver producer in Colombia with several underground mines in operation at its Segovia and Marmato Operations. In addition, Gran Colombia is advancing a project to develop a large-scale, gold and silver mine at its Marmato operations.

Additional information on Gran Colombia Gold can be found on the Company's website at www.grancolombiagold.com and by reviewing the Company's page on SEDAR at www.sedar.com.

This news release contains "forward-looking information", which may include, but is not limited to, statements with respect to the future financial or operating performance of the Company and its projects and, specifically, statements concerning anticipated growth in annual gold production and reduction of cash costs. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes" or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Gran Colombia to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors that could cause actual results to differ materially from those anticipated in these forward-looking statements are described under the caption "Risk Factors" in the Company's Annual Information Form dated as of March 28, 2012 which is available for view on SEDAR at www.sedar.com. Forward-looking statements contained herein are made as of the date of this press release and Gran Colombia disclaims, other than as required by law, any obligation to update any forward-looking statements whether as a result of new information, results, future events, circumstances, or if management's estimates or opinions should change, or otherwise. 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, the reader is cautioned not to place undue reliance on forward-looking statements.


 

SOURCE Gran Colombia Gold Corp.

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
GENBAND has announced that SageNet is leveraging the Nuvia platform to deliver Unified Communications as a Service (UCaaS) to its large base of retail and enterprise customers. Nuvia’s cloud-based solution provides SageNet’s customers with a full suite of business communications and collaboration tools. Two large national SageNet retail customers have recently signed up to deploy the Nuvia platform and the company will continue to sell the service to new and existing customers. Nuvia’s capabili...
WHOA.com has announced the newest addition to its data center footprint with the expansion into Equinix's newest state-of-the-art facility: DC-11 Washington, DC IBX+. Located in Ashburn, VA, this data center expands Whoa.com's presence to meet rapidly expanding customer demand for secure cloud solutions. Equinix, Inc. operates International Business Exchange™ (IBX®) data centers in 32 markets across 15 countries in the Americas, EMEA, and Asia-Pacific. Equinix is committed to operating faciliti...
Hosted PaaS providers have given independent developers and startups huge advantages in efficiency and reduced time-to-market over their more process-bound counterparts in enterprises. Software frameworks are now available that allow enterprise IT departments to provide these same advantages for developers in their own organization. In his workshop session at DevOps Summit, Troy Topnik, ActiveState’s Technical Product Manager, will show how on-prem or cloud-hosted Private PaaS can enable organ...
The WebRTC Summit 2014 New York, to be held June 9-11, 2015, at the Javits Center in New York, NY, announces that its Call for Papers is open. Topics include all aspects of improving IT delivery by eliminating waste through automated business models leveraging cloud technologies. WebRTC Summit is co-located with 16th International Cloud Expo, @ThingsExpo, Big Data Expo, and DevOps Summit.
SYS-CON Media announced today that @WebRTCSummit Blog, the largest WebRTC resource in the world, has been launched. @WebRTCSummit Blog offers top articles, news stories, and blog posts from the world's well-known experts and guarantees better exposure for its authors than any other publication. @WebRTCSummit Blog can be bookmarked ▸ Here @WebRTCSummit conference site can be bookmarked ▸ Here
SYS-CON Events announced today that Cisco, the worldwide leader in IT that transforms how people connect, communicate and collaborate, has been named “Gold Sponsor” of SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Cisco makes amazing things happen by connecting the unconnected. Cisco has shaped the future of the Internet by becoming the worldwide leader in transforming how people connect, communicate and collaborat...
WSM International is launching a DevOps services division that offers assessment, consulting and implementation to large enterprises and organizations with complex infrastructures. This is the first independent services company to create a dedicated practice to help organizations looking to transition to the DevOps model. The concept of DevOps is to blend information technology (IT) software development with operations to optimize the computing infrastructure according to the specific needs of ...
SYS-CON Events announced today that the DevOps Institute has been named “Association Sponsor” of SYS-CON's DevOps Summit, which will take place on June 9–11, 2015, at the Javits Center in New York City, NY. The DevOps Institute provides enterprise level training and certification. Working with thought leaders from the DevOps community, the IT Service Management field and the IT training market, the DevOps Institute is setting the standard in quality for DevOps education and training.
SYS-CON Events announced today that robomq.io will exhibit at SYS-CON's @ThingsExpo, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. robomq.io is an interoperable and composable platform that connects any device to any application. It helps systems integrators and the solution providers build new and innovative products and service for industries requiring monitoring or intelligence from devices and sensors.
Temasys has announced senior management additions to its team. Joining are David Holloway as Vice President of Commercial and Nadine Yap as Vice President of Product. Over the past 12 months Temasys has doubled in size as it adds new customers and expands the development of its Skylink platform. Skylink leads the charge to move WebRTC, traditionally seen as a desktop, browser based technology, to become a ubiquitous web communications technology on web and mobile, as well as Internet of Things...
Wearable technology was dominant at this year’s International Consumer Electronics Show (CES) , and MWC was no exception to this trend. New versions of favorites, such as the Samsung Gear (three new products were released: the Gear 2, the Gear 2 Neo and the Gear Fit), shared the limelight with new wearables like Pebble Time Steel (the new premium version of the company’s previously released smartwatch) and the LG Watch Urbane. The most dramatic difference at MWC was an emphasis on presenting we...
Today, IT is not just a cost center. IT is an enabler and driver of business. With the emergence of the hybrid cloud paradigm, IT now has increasingly more capabilities to create new strategic opportunities for a business. Hybrid cloud allows an organization to utilize multi-tenant public clouds, dedicated private clouds, bare metal hosting, and the associated support and services for the right use cases through an on-demand, XaaS model. This model of IT creates tremendous opportunities for busi...
Docker is an excellent platform for organizations interested in running microservices. It offers portability and consistency between development and production environments, quick provisioning times, and a simple way to isolate services. In his session at DevOps Summit at 16th Cloud Expo, Shannon Williams, co-founder of Rancher Labs, will walk through these and other benefits of using Docker to run microservices, and provide an overview of RancherOS, a minimalist distribution of Linux designed...
Business as usual for IT is evolving into a “Make or Buy” decision on a service-by-service conversation with input from the LOBs. How does your organization move forward with cloud? In his general session at 16th Cloud Expo, Paul Maravei, Regional Sales Manager, Hybrid Cloud and Managed Services at Cisco, discusses how Cisco and its partners offer a market-leading portfolio and ecosystem of cloud infrastructure and application services that allow you to uniquely and securely combine cloud busi...
SYS-CON Events announced today that Akana, formerly SOA Software, has been named “Bronze Sponsor” of SYS-CON's 16th International Cloud Expo® New York, which will take place June 9-11, 2015, at the Javits Center in New York City, NY. Akana’s comprehensive suite of API Management, API Security, Integrated SOA Governance, and Cloud Integration solutions helps businesses accelerate digital transformation by securely extending their reach across multiple channels – mobile, cloud and Internet of Thi...