Mr. David Wolfin reports
AVINO REPORTS Q1 2022 FINANCIAL RESULTS
Avino Silver & Gold Mines Ltd. has released its consolidated financial results for the company's first quarter 2022. The financial statements and management's discussion and analysis (MD&A) can be viewed on the company's website, on SEDAR and on EDGAR.
"We are very pleased with the strong start to the year, highlighted by record revenues and mine operating income," said David Wolfin, president and chief executive officer. "We had an outstanding first quarter and our financial performance demonstrates strong operational achievements that generated $11.1-million in revenues and $4.7-million in mine operating income, with earnings per share of one cent and operating cash flow and adjusted earnings per share of three cents. During the quarter, we maintained strong and consistent margins. The closing of the acquisition of La Preciosa sets us on the pathway to expand our current mining complex through regional growth with the goal of achieving intermediate producer status. Together with exciting drill results from La Potosina and the Oxide Tailings, the events of the quarter are just the beginning of an important time in Avino's history, and we are looking forward to the remainder of the year and beyond."
First quarter 2022 highlights
Strong Q1 2022 financial performance with record revenues and mine operating income
Record revenues and mine operating income, with revenues of $11.1-million and mine operating income of $4.7-million, earnings per share of one cent and operating cash flow generated (preworking capital adjustments) per share of three cents.
Closing of strategic acquisition of La Preciosa silver project from Coeur Mining Inc.
On March 21, 2022, the company announced that it has closed the acquisition with Coeur to acquire the La Preciosa silver project, which is located adjacent to the Avino mine in the state of Durango, Mexico, for upfront consideration of $29.7-million, consisting of $15.3-million cash and the remaining in equity on closing, and $5-million due within 12 months of closing. Further contingent consideration including cash, royalties and a mineral reserve discovery payment.
La Potosina exploration results continue to impress
- On March 9, 2022, the company announced drill results from the La Potosina area of the Avino property, including 668 grams per tonne AgEq (silver equivalent) over 2.95 metres. These results are following up on historic results from 2011, which included 2,737 g/t AgEq over 0.40 metre.
Advanced the Oxide Tailings project
With the release of the results from the 110-drill-hole program, the company is moving forward with a comprehensive metallurgical testwork program to progress this project to the next phase of development.
Working capital and liquidity at March 31, 2022
The company's cash balance at March 31, 2022, totalled $11.7-million compared with $24.8-million at Dec. 31, 2021. Working capital totalled $14.5-million at March 31, 2022, compared with $31.6-million at Dec. 31, 2021. Both of these figures have increased on a net basis following the upfront consideration payment of $15.3-million and addition of $5-million note payable to Coeur for the acquisition La Preciosa.
First quarter 2022 financial highlights
Record revenues of $11.1-million;
Record mine operating income of $4.7-million, $5.2-million net of non-cash depreciation and depletion;
- Net income of $600,000, or one cent per share;
- Cash costs per silver equivalent payable ounce sold -- $11.81 per ounce;
- All-in sustaining cash cost per silver equivalent payable ounce sold -- $19.90 per ounce;
- Earnings before interest, taxes, depreciation and amortization (EBITDA) of $2.8-million;
Adjusted earnings of $3.4-million, or three cents per share;
- Operating cash flows (before working capital changes) of $3.7-million, or three cents per share.
Cash capital expenditures company-wide for the first quarter 2022 were $900,000 compared with $400,000 for first quarter 2021. Expenditures relate to exploration drilling costs on the Avino property and on TSF No. 1, which contains the Oxide Tailings resource, and costs related to the construction of the dry-stack tailings storage facility. The company also added an additional $1.0-million in leased capital equipment, including a new underground scooptram.
During Q1 2022, underground mining operations continued to ramp-up with consolidation production for the quarter of 457,798 silver equivalent ounces consisting of 164,358 ounces of silver, 801 ounces of gold and 1,217,349 pounds of copper.
Underground mining operations are now hauling between 1,400 and 1,900 tonnes per day to surface on a daily basis, with the mill operating at a similar capacity. The company is working toward achieving nameplate capacity of 2,500 tpd.
Exploration update -- 2022 drill program
The company has budgeted 15,000 metres of drilling in 2022, with a focus on La Potosina, at depths below the current Elena Tolosa production area and further drilling of 17 additional holes on the Oxide Tailings project. To date, the company has completed 5,075 metres of drilling in 2022.
During the quarter, the company announced drill results from phase 2 of the 2021 drill campaign which included over 15,500 metres of drilling focusing on several targets.
The initial results from La Potosina were announced in early March and included 2,400 metres of drilling. This area of the Avino property has been known to host high-grade, low-suphidation style mineralization similar to our San Gonzalo mine. The La Potosina area is only three kilometres from the San Gonzalo mine and five km from the mill facilities at the Avino mine.
Peter Latta, PEng, MBA, vice-president of technical services, Avino, who is a qualified person within the context of National Instrument 43-101 and has reviewed and approved the technical data in this news release.
Conference call and webcast
In addition, the company will be holding a conference call and webcast on Thursday, May 12, 2022, at 9 a.m. PT (12 p.m. ET). Shareholders, analysts, investors and media are invited to join the webcast and conference call.
Toll-free Canada and United States: 1-800-319-4610
Outside of Canada and United States: 1-604-638-5340
Silver & Gold Mines Ltd.
Avino is primarily a silver producer from its wholly owned Avino mine near Durango, Mexico. The company's silver, gold and copper production remains unhedged. The company's mission and strategy are to create shareholder value through organic growth at the historic Avino property and the strategic acquisition of mineral exploration and mining properties. The company is committed to managing all business activities in a safe, environmentally responsible and cost-effective manner, while contributing to the well-being of the communities in which it operates.
We seek Safe Harbor.
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