TORONTO, May 21, 2019 (GLOBE NEWSWIRE) -- Galantas Gold Corporation (the "Company" or “Galantas”) is pleased to announce its financial results for the Quarter ended March 31, 2019.
Highlights of the first quarter 2019 results, which are expressed in Canadian Dollars, are summarized below:
| ||Quarter Ended March 31|
|All in CDN$|| ||2019|| || ||2018|| |
|Revenue||$ 0|| ||$ 0|| |
|Cost and expenses of Operations||$(70,026||)||$(24,066||)|
|Loss before the items below||$(70,026||)||$(24,066||)|
|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 CDN$ 779,517 (2018: CDN$ 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 CDN$ 391,037 (2018: CDN$ 332,420).
The Company had a cash balance of $ 3,767,187 at March 31, 2019 compared to $ 182,513 at March 31, 2018. The working capital deficit at March 31, 2019 amounted to $ 2,702,004 compared to 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 capitalised 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 & 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 cross-cuts 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 cross-cut 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 1136 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 towards 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 pre-payment / loan facility with Ocean Partners UK Ltd (announced 12th April 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 11:00 a.m. (Toronto time) on 27th June 2019 at DSA Corporate Services Inc., 82 Richmond Street East, Toronto, Ontario, M5C1P1, Canada.
The detailed results and Management Discussion and Analysis (MD&A) are available on www.sedar.com and www.galantas.com 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 & CEO), qualified persons under the meaning of NI. 43-101 and AIM requirements. The information is based upon local production and financial data prepared under their supervision.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS: This press release contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws, including revenues and cost estimates, for the Omagh Gold project. Forward-looking statements are based on estimates and assumptions made by Galantas in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors that Galantas believes are appropriate in the circumstances. Many factors could cause Galantas’ actual results, the performance or achievements to differ materially from those expressed or implied by the forward looking statements or strategy, including: gold price volatility; discrepancies between actual and estimated production, actual and estimated metallurgical recoveries and throughputs; mining operational risk, geological uncertainties; regulatory restrictions, including environmental regulatory restrictions and liability; risks of sovereign involvement; speculative nature of gold exploration; dilution; competition; loss of or availability of key employees; additional funding requirements; uncertainties regarding planning and other permitting issues; and defective title to mineral claims or property. These factors and others that could affect Galantas’s forward-looking statements are discussed in greater detail in the section entitled “Risk Factors” in Galantas’ Management Discussion & Analysis of the financial statements of Galantas and elsewhere in documents filed from time to time with the Canadian provincial securities regulators and other regulatory authorities. These factors should be considered carefully, and persons reviewing this press release should not place undue reliance on forward-looking statements. Galantas has no intention and undertakes no obligation to update or revise any forward-looking statements in this press release, except as required by law.
Galantas Gold Corporation
Jack Gunter P.Eng – Chairman, Roland Phelps C.Eng – President & CEO
Telephone: +44 (0) 2882 241100
Grant Thornton UK LLP (Nomad)
Philip Secrett, Richard Tonthat
Telephone: +44(0)20 7383 5100
Whitman Howard Ltd (Broker & Corporate Adviser)
Ranald McGregor-Smith, Nick Lovering
Telephone: +44(0)20 7659 1234
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