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Enter Symbol
or Name
USA
CA



Orvana Minerals Corp
Symbol ORV
Shares Issued 136,623,171
Close 2018-08-08 C$ 0.16
Market Cap C$ 21,859,707
Recent Sedar Documents

Orvana loses $2.98-million in Q3 2018

2018-08-08 20:06 ET - News Release

Mr. Juan Gavidia reports

ORVANA REPORTS Q3 2018 RESULTS AND PROVIDES GUIDANCE UPDATE

Orvana Minerals Corp. has released its financial and operational results for the third quarter. The Company is also providing financial and operational updates for its El Valle and Carles Mines (collectively, "El Valle") operations in northern Spain and its Don Mario Mine Complex ("Don Mario") in Bolivia.

The unaudited condensed interim consolidated financial statements for Q3 2018 and Management's Discussion and Analysis related thereto are available on SEDAR and on the Company's website.

Q3 2018 Highlights

  • El Valle - Delivers higher gold production due to 13% increase in processed ore:
    • -Gold production improved by 11% compared to Q2 2018 and recoveries remained steady at 91.8%;
    • -Productivity enhancements at both, oxides and skarn production, allowed for delivery of higher processed ore volume and grades to the mill;
    • - Grades improved by 43% compared to Q3 2017 and remained in line with the previous quarter;
    • -Oxide production is being sustained at 39% of mill ore feed;
    • - Mechanical advance rates in oxide areas continued to improve, increasing by 20% to 1,919 meters during Q3 2018;
    • - El Valle will be restarting a sector of the Carles Mine as a short-term project commencing in Q4 2018.
  • Don Mario - Production from Cerro Felix continues:
    • - Gold recoveries from the Don Mario CIL plant increased to 92.4%, compared with 91.3% in the previous quarter;
    • - Gold production was 9,916 ounces, an increase of 3% compared with the previous quarter.
    • - Ore production was impacted by lower grades in the upper level of Cerro Felix. Higher grades are expected as the lower pit areas are mined in the following quarter.

Juan Gavidia, Interim CEO stated, "We are pleased with the progress at El Valle with continuing increases of mechanical advance rates, higher oxide production and processing at the mill along with increased grades year to date. We are committed to maintaining and improving on this trend since we are slightly below the challenging targets we imposed on ourselves for fiscal 2018. At Don Mario, higher gold recoveries from the CIL process resulted in the improvement of gold production but were offset by the reduction in gold grade during the transition to the Cerro Felix area. We are expecting higher grades from the lower pit areas in the next quarter and onwards. We are providing slightly revised gold and copper production guidance and AISC costs this quarter, which is in line with current production, and we expect to be on track to achieve COC guidance."

Strategy and Outlook

The Company continues to pursue its objectives of optimizing production, lowering unitary cash costs, maximizing fee cash flow, extending the life-of-mine of its operations and growing its operations to deliver shareholder value.

At El Valle, the primary objective in fiscal 2018 is to continue increasing higher-grade oxides mining, therefore targeting more gold output than the one realized in FY2017. The guidance put forward for FY2018 production assumed an operational transformation at our Boinas mine. This undertaking has unfolded with the right trend, although at a slower pace, along these last three quarters. To keep working on the maximization of high-grade oxides in the mill feed, we are conducting additional geological and geotechnical work, in order to increase mining reliability (due to the challenging grade variability and ground stability issues). Infrastructure and fleet maintenance investments to improve productivity and efficiency will continue to be made through last quarter of fiscal 2018, as planned.

At Don Mario, the Company continues to produce consistent results from its re-commissioned CIL circuit, with a recovery rate averaging above 92% during the third quarter of fiscal 2018. Don Mario continues to pursue realization of a number of known opportunities for mine life extension, including potential mining of the Company's Las Tojas satellite deposit, processing existing mineral stockpiles, and reprocessing gold bearing tailings. With regards to exploration activities on Las Tojas, the Company expects to release results by the end of fiscal 2018.

FY 2018 Production and Cost Guidance

Based on results from the first nine months of fiscal 2018, the Company is revising its production guidance. The Company expects to achieve its COC guidance for fiscal 2018 but is revising AISC guidance.

The following table sets out Orvana's Q3 2018 results as well as its updated fiscal 2018 production, cost and capex guidance:

                                            YTD 2018   ActualFY 2018   GuidanceFY 2018   Revised Guidance
El Valle Production
Gold (oz)                                              42,768   65,000 - 72,000       55,000 - 62,000
Copper (million lbs)                                      3.8         4.1 - 4.5             4.9 - 5.3
Don Mario Production
Gold (oz)                                              31,953   45,000 - 48,000        45,000- 48,000
Copper (million lbs)                                      3.1         2.0 - 2.3                   3.1
Total Production
Gold (oz)                                              74,721 110,000 - 120,000     100,000 - 110,000
Copper (million lbs)                                      6.9         6.1 - 6.8             8.0 - 8.4
Total capital expenditures                            $17,287 $24,000 - $27,000     $21,000 - $24,000
Cash operating costs (by-product) ($/oz) gold (1)      $1,028     $950 - $1,050       $1,000 - $1,050
All-in sustaining costs (by-product) ($/oz) gold (1)   $1,286   $1,150 - $1,250       $1,250 - $1,300

(1) FY 2018 guidance assumptions for COC and AISC include fourth quarter by-product commodity price of $2.75 per pound of copper and an average Euro to US Dollar exchange of 1.18.

      Selected Consolidated Operational and Financial Information
 
                                         Q3 2018 Q2 2018 Q3 2017 YTD 2018YTD 2017 
Operating Performance
Gold
Grade (g/t)                                 2.62    2.54    2.49    2.57     2.33
Recovery (%)                                92.0    92.2    90.6    91.4     82.5
Production (oz)                           26,761  24,788  26,414  74,721   62,626
Sales (oz)                                26,490  25,489  24,287  73,974   58,997
Average realized price / oz               $1,298  $1,304  $1,262  $1,299   $1,253
Copper
Grade (%)                                   0.51    0.57    0.65    0.58     0.72
Recovery (%)                                81.6    63.0    73.7    66.5     64.0
Production ('000 lbs)                      1,575   2,609   3,837   6,943   10,292
Sales ('000 lbs)                           2,225   2,531   4,244   7,456   10,836
Average realized price / lb                $3.11   $2.80   $2.45   $3.11    $2.42
Financial Performance
(in 000's, except per share amounts)
Revenue                                  $38,438 $36,930 $36,671$109,538  $91,843
Mining costs                             $31,729 $30,525 $31,180 $90,314  $81,808
Gross margin                                 $73  ($394)($1,909)    $137 ($8,754)
Net loss                                ($2,982)($3,505)($3,446)($9,866)($13,833)
Net loss per share (basic/diluted)       ($0.02) ($0.03) ($0.03) ($0.07)  ($0.10)
EBITDA (1)                                $3,930  $4,473  $4,782 $12,585   $6,222
Operating cash flows before
non-cash working capital changes          $4,282  $2,447  $2,930  $8,815   $3,317
Operating cash flows                      $4,010($5,486)  $7,769    $671   $8,396
Ending cash and cash equivalents         $13,484 $12,482 $18,504 $13,484  $18,504
Capital expenditures (2)                  $5,618  $5,462  $3,294 $17,287  $15,512
Cash operating costs (by-product)
($/oz) gold (1)                           $1,027  $1,055  $1,032  $1,028   $1,071
All-in sustaining costs (by-product)
($/oz) gold (1)(2)                        $1,291  $1,309  $1,199  $1,286   $1,330

(1)Earnings before interest, taxes, depreciation and amortization ("EBITDA"), cash operating costs and all-in sustaining costs are non-IFRS performance measures.

(2)Each reported period excludes capital expenditures incurred in the period which will be paid in subsequent periods and includes capital expenditures incurred in prior periods and paid for in the applicable reporting period. The calculation of AISC includes capital expenditures incurred (paid and unpaid) during the period.

About Orvana

Orvana is a multi-mine gold and copper producer. Orvana's operating assets consist of the producing gold-copper-silver El Valle and Carles mines in northern Spain and the producing gold Don Mario mine in Bolivia. Additional information is available at Orvana's website (www.orvana.com).

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