Timmins Gold / Alio Gold Announces Q1 2017 Results
VANCOUVER, BRITISH COLUMBIA--(Marketwired - May 11, 2017) - Timmins Gold Corp. (TSX:TMM)(NYSE MKT:TGD) ("Timmins Gold" or the "Company") is proposing to change its name to Alio Gold Inc. at its upcoming Annual General Meeting of Shareholders. If approved, the Company expects to begin trading on both the TSX and the NYSE MKT under the ticker ALO on May 16, 2017.
The Company announces the results for the first quarter 2017 ("Q1"). Production results were previously released on April 4, 2017. All results are presented in United States dollars ("US Dollars") unless otherwise stated. Readers should refer to the Q1 management discussion and analysis and condensed interim consolidated financial statements available on the Company's website or 32TUwww.sedar.com for complete information.
The Company will host a conference call at 11:00am EST today, Thursday, May 11(Pth) P. Please see details at the bottom of this news release.
Q1 HIGHLIGHTS
-- Strengthening balance sheet with $39.2 million in cash and working
capital of $41.0 million.
-- Metal revenues of $32.3 million from 26,048 ounces of gold sold at
$1,232/oz.
-- Cash provided by operating activities of $9.7 million after changes in
non-cash working capital.
-- Earnings and comprehensive income of $6.0 million ($0.02/share).
-- Cash costs1 of $735/oz and All-in Sustaining Costs1 P11of $848/oz.
Commenting on the Company's performance, Chief Executive Officer, Greg McCunn, said, "The first quarter of 2017 was a strong quarter in which the San Francisco mine exceeded production guidance by a significant margin. The continued focus on maintaining our cost structure has resulted in another strong quarter of cash flow generation which more than funded the Company's development expenditures at our high-grade, high-margin Ana Paula project and continued to allow us to build cash on the balance sheet. With our revitalization plan now complete, we expect to start executing the plan in the second half of this year which will allow the mine to continue to perform at these levels out until at least 2023."
Financial performance
-- Metal revenues were $32.3 million compared to $28.6 million during Q1
2016. This represents a 12.9% increase from the prior year. The increase
was a result of both an increase in gold ounces sold (26,048 compared to
24,667 ounces during Q1 2016) and an increase in the average realized
gold price ($1,232 per ounce compared to $1,160 during Q1 2016).
-- Earnings from operations were $9.8 million compared to a loss of $8.6
million during Q1 2016. The difference was due to an impairment of $12.8
million that was recognized during Q1 2016 related to the Caballo Blanco
asset sale. In addition, there were improved earnings from mine
operations during Q1 2017 of $11.1 million compared to $6.3 million
during Q1 2016. Corporate and administrative expenses decreased to $1.3
million compared to $2.1 million during Q1 2016.
-- Earnings and comprehensive income were $6.0 million or $0.02 per share
compared to loss and comprehensive loss of $10.7 million or $0.03 per
share during Q1 2016.
-- Cash provided by operating activities was $9.7 million or $0.03 per share
compared to $2.4 million or $0.01 per share during Q1 2016.
-- Cash and cash equivalents at March 31, 2017, were $39.2 million. During
the quarter, the Company generated $9.7 million from operations, invested
$1.6 million on sustaining capital expenditures, $0.4 million on
exploration and evaluation projects, and $2.8 million on the Ana Paula
gold project ("Ana Paula" or "the Project"). Also, the Company received
$3.6 million of its VAT receivable in cash. Subsequent to March 31, 2017,
the Company received $0.6 million of the $3.5 million VAT receivable.
-- Cash and cash equivalents and restricted cash at March 31, 2016, were
$9.7 million and $1.0 million, respectively, after investing $0.1 million
on exploration, $0.2 million on sustaining capital, and $2.7 million on
the Ana Paula property.
-- Working capital at March 31, 2017, was $41.0 million, an improvement of
$38.4 million from March 31, 2016. This increase is a result of cash
provided by operating activities of $9.7 million compared to $2.4 million
during Q1 2016. Additionally, during the prior fiscal year, the Company:
-- Sold the Caballo Blanco Property increasing cash by $9.2 million;
-- Completed a bought deal financing increasing cash by $13.8
million; and,
-- Settled the loan facility and debenture decreasing cash by $10.2
million and $1.5 million, respectively.
Operating performance
-- The Company produced and sold 26,048 ounces of gold, compared to 25,120
and 24,667 ounces of gold, respectively, during Q1 2016. The production
increase was due to improved recovery, offset by a decrease in average
processing grade of 0.48 g/t Au compared to 0.62 g/t Au during Q1 2016.
-- The Company's cash cost per ounce on a by-product basis was $735 (all-in
sustaining cost per ounce on a by-product basis - $848) compared to $761
(all-in sustaining cost per ounce on a by-product basis - $848) during Q1
2016. This decrease in cash cost was due to a lower strip ratio and
increased production.
Q1 results conference call and webcast:
Date: Thursday May 11, 2017
Time: 11:00 a.m. ET
Live: 1-855-427-9509 (Canada and U.S. toll free)
1-201-229-8822 (Outside North America)
Conf ID: 7736649
Webcast: https://edge.media-server.com/m/p/x79rj9k2
Replay: To be available on the Timmins Gold website at https://www.timminsgold.com/
SUMMARIZED QUARTERLY FINANCIAL STATEMENTS AND OPERATING RESULTS
US dollars (thousands) except where noted Q1 2017 Q1 2016