Mr. Jack Gunter reports
GALANTAS REPORTS RESULTS FOR THE QUARTER ENDED MARCH 31, 2019 AND ANNOUNCES SHAREHOLDERS MEETING
Galantas Gold Corp. has released its financial results for the quarter ended March 31, 2019.
Highlights of the first quarter 2019 results are summarized in the associated table.
Quarter ended March 31
Revenue $0 $0
(Cost) and expenses of operations (70,026) (24,066)
(Loss) before the items below (70,026) (24,066)
Amortization (loss) (87,405) (64,249)
General administrative (expenses) (602,429) (408,890)
Unrealized gain on fair value of
derivative financial liability 0 10,000
Foreign exchange (loss) (19,657) (37,293)
Net (loss) for the quarter (779,517) (524,498)
Working capital (deficit) (2,702,004) (5,123,420)
Cash (loss) generated from operations
before changes in non-cash working capital (391,037) (332,420)
Cash at March 31, 2019 3,767,187 182,513
The net loss for the quarter ended March 31, 2019, amounted to $779,517 (2018: $524,498) and the cash outflow from operating activities before changes in non-cash working capital items for the quarter ended March 31, 2019, amounted to $391,037 (2018: $332,420).
The company had a cash balance of $3,767,187 at March 31, 2019, compared with $182,513 at March 31, 2018. The working capital deficit at March 31, 2019, amounted to $2,702,004 compared with a working capital deficit of $5,123,420 at March 31, 2018. Until the mine reaches the commencement of commercial production, which is expected to be later in 2019, all development expenditures are capitalized with net proceeds from sales deducted from development costs.
In the first quarter of 2019 the Omagh gold mine continued limited production of gold concentrate from feed produced in the development of the Kearney vein. The plant, which produces a gold and silver concentrate using a non-toxic, froth flotation process, is running on a batch basis from a stockpile of underground vein material plus additional feed produced from on-vein development operations.
Underground development of a decline tunnel continued to be progressed during the first quarter of 2019 with further crosscuts allowing access to lower levels of vein development which forms the development necessary to demarcate production panels. The increased number of development headings is expected to provide an enhanced supply of mill feed. During the quarter, on-vein development on the 1084 (second) level continued with 32 metres of vein drive being completed. Later in the quarter the company reported that the main decline development tunnel has reached the 1072 (third) level and a 58-metre crosscut to intersect the Kearney vein was in progress. The vein on the 1072 (third) was reached early in the second quarter and on-vein development has commenced. At quarter-end the main decline tunnel was 423 metres in length and the total of all underground drivages exceeded 1,136 metres. For most of the rest of 2019, the increased quantities of processing feed will be sourced from multiple on-vein development headings. Mining between levels (stoping) is expected by or before early 2020.
Ground conditions have notably improved as the mine continues toward deeper levels, a feature ascribed to changes in rock stress conditions influenced, at higher levels, by the open-pit excavation. The mine employs a robust ground control procedure using rockbolts, mesh and/or shotcrete to engineered designs.
On March 26, 2019, Galantas reported the expansion of gold milling operations at the Omagh processing plant. Milling operations progressed during the first quarter of 2019 on an extended dayshift basis, as feed became available. As expected, a second shift was subsequently added early in the second quarter. Additional milling shifts are planned to be added in the third quarter, when additional quantities of feed are confirmed. The processing plant, which was used formerly for open-pit operations, has had the benefit of a recent upgrade and further upgrades are planned. Recent analyses suggest that the product from the plant meets quality criteria and operates at a high efficiency. Shipments into a concentrate prepayment/loan facility with Ocean Partners U.K. Ltd. (announced April 12, 2018) commenced early in the second quarter. Three shipments of approximately seventy five tonnes of concentrate have been shipped, with a further 25 tonnes expected to ship shortly. The value of the shipments await assay agreement as per usual procedures.
Environmental monitoring continues to demonstrate a high level of regulatory compliance. Safety is a high priority and the zero-lost-time accident rate, since the start of underground operations, continues.
The annual and special meeting of the company is to be held at 11 a.m. Toronto time on June 27, 2019, at DSA Corporate Services Inc., 82 Richmond St. East, Toronto, Ont., M5C1P1, Canada.
The detailed results and management discussion and analysis (MD&A) are available on
the company's website
and the highlights in this release should be read in conjunction with the detailed results and MD&A. The MD&A provides an analysis of comparisons with previous periods, trends affecting the business and risk factors.
The financial components of this disclosure has been reviewed by Leo O'Shaughnessy (chief financial officer) and the production component by Roland Phelps (president and chief executive officer), qualified persons under the meaning of National Instrument 43-101 and Alternative Investment Market requirements. The information is based upon local production and financial data prepared under their supervision.
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