/NOT FOR DISSEMINATION OR DISTRIBUTION IN THE UNITED STATES AND NOT FOR
DISTRIBUTION TO US NEWSWIRE SERVICES./
(All references in US Dollars)
MELBOURNE, July 25, 2013 /CNW/ - OceanaGold Corporation (ASX: OGC, TSX: OGC, NZX: OGC) (the "Company") today released its second quarter 2013 results for the
quarter ended June 30, 2013. Details of the consolidated financial
statements and the Management Discussion and Analysis (MD&A) are
available on the Company's website at www.oceanagold.com
Key highlights include:
-
Total Company gold production of 68,353 ounces and copper production of
5,710 tonnes in the second quarter of 2013.
-
Total Company gold sales of 70,706 at cash costs net of by-product
credits of $682 per ounce.
-
Revenue of $131.2 million for the second quarter of 2013.
-
Commercial production at Didipio declared effective April 1, 2013.
-
Utilising the World Gold Council (WGC) standard for calculating All-In
Sustaining Costs (AISC), the Company provided estimated AISC for the
group of $930 - $1,080 per ounce for 2013.
-
The Company reviewed the carrying value of its assets and as a result of
the significant decline in the gold price and reduction in the mine
schedule at Reefton, a pre-tax impairment charge of $85.5 million has
been recognised.
Overall, the Company produced 68,353 ounces of gold and 5,710 tonnes of
copper in the second quarter. Gold production was higher compared to
the first quarter on account of increased production from Didipio and
Reefton.
The Company's total cash costs net of by-product copper credits were
$682 per ounce on gold sales of 70,706 ounces. At Didipio, cash costs
on a by-product basis were negative $586 per ounce on gold sales of
11,086 ounces and copper sales of 5,073 tonnes. In New Zealand, cash
costs were $918 per ounce on gold sales of 59,620 ounces.
The Company declared commercial production at Didipio effective April 1,
2013. Didipio has successfully ramped up to commercial production rates
in just over three months from commencement of first ore through the
mills in December 2012. During the quarter, Didipio produced 13,676
ounces of gold and 5,710 tonnes of copper and in the first half of the
year the mine has produced 20,553 ounces of gold and 9,373 tonnes of
copper.
In New Zealand, production was higher quarter on quarter at Reefton due
to additional tonnage mined, higher grade ore processed and better
recoveries. At Macraes, second quarter production was lower than in the
previous quarter as expected, due to the adjustments made to the mine
schedule following the pit wall movement reported in January.
Additionally, the mine experienced severe rain and snow in mid-June
that hampered mining operations. The Company expects production in New
Zealand to progressively increase over the remainder of the year with
the fourth quarter being the strongest quarter in 2013.
OceanaGold reported EBITDA (earnings before interest, taxes,
depreciation and amortisation excluding gain/(loss) on undesignated
hedges and impairment charge) of $42.5 million and a net loss of $70.5
million for the quarter. The net loss reflects a pre-tax, non-cash
impairment charge of $85.5 million, which is primarily attributable to
the significant decline in the gold price and resultant reduction in
mine schedule at Reefton.
The Company has been conducting a company-wide review of its operations
to identify efficiencies and reduce costs. As reported in June, the
final cutback at Reefton has been put on hold and as a result, the mine
will transition into a care and maintenance phase mid-year 2015 unless
there is a material improvement in the gold price. The Company has also
deferred pre-stripping on the Frasers 6 cutback at Macraes. Operating
expenditure over the next 18 months will be reduced by approximately
$100 million and will include savings generated from deferring the
final cutbacks at Reefton and Macraes, plus other operating and capital
savings. The company-wide review is ongoing to identify additional
opportunities to improve cash flow from operations.
OceanaGold Managing Director and CEO, Mick Wilkes said, " Like the rest
of the gold mining industry, the Company is currently faced with
tougher economic realities that require a proactive approach to ensure
a healthy business plan. We are committed to preserving shareholder
value and we will continue to operate based on this premise. To date,
we have reduced our operating budgets by $100 million over the next 18
months and continue to look for additional opportunities to optimise
our business. Didipio will continue to drive down our cash cost per
ounce whilst increasing our production profile. With cash flows
increasing over the next few years and with significant cost reductions
at our New Zealand operations, the Company is well positioned for the
new economic environment in the gold industry."
Conference Call / Webcast
The Company will host a conference call / webcast to discuss the results
at 7:30am on Friday 26 July 2013 (Melbourne, Australia time) / 5:30pm
on Thursday 25 July (Toronto, Canada time). Details are available on
the home page of the OceanaGold website at www.oceanagold.com
Webcast Participants
To register, please copy and paste the link below into your browser:
http://event.on24.com/r.htm?e=652642&s=1&k=24FBB937C932BA5969CFB3BC96D24CD3
Teleconference Participants (required for those who wish to ask
questions)
Local (toll free) dial in numbers are:
Australia: 1 800 148 052
New Zealand: 0 800 441 017
Canada & North America: 1 888 390 0546
All other countries (toll): + 1 416 764 8688
Playback of Webcast
If you are unable to attend the call, a recording will be available for
viewing on the Company's website from 10:30am on Friday 26 July
(Melbourne, Australia time) / 8:30pm on Thursday 25 July (Toronto,
Canada time).
About OceanaGold
OceanaGold Corporation is a significant multinational gold producer with
projects located on the South Island of New Zealand and in the
Philippines. The Company's assets encompass New Zealand's largest gold
mining operation at the Macraes goldfield in Otago which is made up of
the Macraes Open Pit and the Frasers Underground mines. Additionally on
the west coast of the South Island, the Company operates the Reefton
Open Pit mine. The Company's Didipio Mine in northern Luzon,
Philippines commenced commercial production on 1 April 2013 and is
expected to produce 100,000 ounces of gold and 14,000 tonnes of copper
per year on average over an estimated 16 year mine life. OceanaGold
expects to produce 285,000 to 325,000 ounces of gold in FY2013 from the
New Zealand and Philippines operations combined.
OceanaGold is listed on the Toronto, Australian and New Zealand stock
exchanges under the symbol OGC.
Cautionary Statement
Statements in this release may be forward-looking statements or
forward-looking information within the meaning of applicable securities
laws. Any statements that express or involve discussions with respect
to predictions, expectations, beliefs, plans, projections, objectives,
assumptions or future events or performance (often, but not always,
using words or phrases such as "expects" or "does not expect", "is
expected", "anticipates" or "does not anticipate", "plans", "estimates"
or "intends", or stating that certain actions, events or results "may",
"could", "would", "might" or "will" be taken, occur or be achieved) are
not statements of historical fact and may be forward-looking
statements. Forward-looking statements such as production forecasts are
subject to a variety of risks and uncertainties which could cause
actual events or results to differ materially from those reflected in
the forward-looking statements. They include, among others, the
accuracy of mineral reserve and resource estimates and related
assumptions, inherent operating risks and those risk factors identified
in the Company's most recent Annual Information Form prepared and filed
with securities regulators which is available on SEDAR at www.sedar.com under the Company's name. There are no assurances the Company can
fulfil such forward-looking statements and, subject to applicable
securities laws, the Company undertakes no obligation to update such
statements. Such forward-looking statements are only predictions based
on current information available to management as of the date that such
predictions are made; actual events or results may differ materially as
a result of risks facing the Company, some of which are beyond the
Company's control. Accordingly, readers should not place undue
reliance on forward-looking statements. The information contained in
this release is not investment or financial product advice.
2013 Second Quarter Results
July 25, 2013
www.oceanagold.com
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING INFORMATION
This Management Discussion & Analysis contains "forward-looking
statements and information" within the meaning of applicable securities
laws which may include, but is not limited to, statements with respect
to the future financial and operating performance of the Company, its
subsidiaries and affiliated companies, its mining projects, the future
price of gold, the estimation of mineral reserves and mineral
resources, the realisation of mineral reserve and resource estimates,
costs of production, estimates of initial capital, sustaining capital,
operating and exploration expenditures, costs and timing of the
development of new deposits, costs and timing of the development of new
mines, costs and timing of future exploration and drilling programs,
timing of filing of updated technical information, anticipated
production amounts, requirements for additional capital, governmental
regulation of mining operations and exploration operations, timing and
receipt of approvals, consents and permits under applicable mineral
legislation, environmental risks, title disputes or claims, limitations
of insurance coverage and the timing and possible outcome of pending
litigation and regulatory matters. Often, but not always,
forward-looking statements and information can be identified by the use
of words such as "plans", "expects", "is expected", "budget",
"scheduled", "estimates", "forecasts", "intends", "targets",
"aims", "anticipates" or "believes" or variations (including negative
variations) of such words and phrases, or may be identified by
statements to the effect that certain actions, events or results "may",
"could", "would", "should", "might" or "will" be taken, occur or be
achieved. Forward-looking statements and information involve known and
unknown risks, uncertainties and other factors which may cause the
actual results, performance or achievements of the Company and/or its
subsidiaries and/or its affiliated companies to be materially different
from any future results, performance or achievements expressed or
implied by the forward-looking statements. Such factors include, among
others, future prices of gold; general business, economic, competitive,
political and social uncertainties; the actual results of current
production, development and/or exploration activities; conclusions of
economic evaluations and studies; fluctuations in the value of the
United States dollar relative to the Canadian dollar, the Australian
dollar, the Philippines Peso or the New Zealand dollar; changes in
project parameters as plans continue to be refined; possible variations
of ore grade or recovery rates; failure of plant, equipment or
processes to operate as anticipated; accidents, labour disputes and
other risks of the mining industry; political instability or
insurrection or war; labour force availability and turnover; adverse
judicial decision, delays in obtaining financing or governmental
approvals or in the completion of development or construction
activities or in the commencement of operations; as well as those
factors discussed in the section entitled "Risk Factors" contained in
the Company's Annual Information Form in respect of its fiscal
year-ended December 31, 2012, which is available on SEDAR at www.sedar.com under the Company's name. Although the Company has attempted to
identify important factors that could cause actual actions, events or
results to differ materially from those described in forward-looking
statements and information, there may be other factors that cause
actual results, performance, achievements or events to differ from
those anticipated, estimated or intended. Also, many of the factors are
outside or beyond the control of the Company, its officers, employees,
agents or associates. Forward-looking statements and information
contained herein are made as of the date of this Management Discussion
& Analysis and, subject to applicable securities laws, the Company
disclaims any obligation to update any forward-looking statements and
information, whether as a result of new information, future events or
results or otherwise. There can be no assurance that forward-looking
statements and information will prove to be accurate, as actual results
and future events could differ materially from those anticipated in
such statements. Accordingly, readers should not place undue reliance
on forward-looking statements and information due to the inherent
uncertainty therein. All forward-looking statements and information
made herein are qualified by this cautionary statement. This Management
Discussion & Analysis may use the terms "Measured", "Indicated" and
"Inferred" Resources. U.S. investors are advised that while such terms
are recognised and required by Canadian regulations, the Securities and
Exchange Commission does not recognise them. "Inferred Resources" have
a great amount of uncertainty as to their existence and as to their
economic and legal feasibility. It cannot be assumed that all or any
part of an Inferred Resources will ever be upgraded to a higher
category. Under Canadian rules, estimates of Inferred Resources may not
form the basis of feasibility or other economic studies. U.S. investors
are cautioned not to assume that all or any part of Measured or
Indicated Resources will ever be converted into reserves. U.S.
investors are also cautioned not to assume that all or any part of an
Inferred Resource exists, or is economically or legally mineable. This
document does not constitute an offer of securities for sale in the
United States or to any person that is, or is acting for the account or
benefit of, any U.S. person (as defined in Regulation S under the
United States Securities Act of 1933, as amended (the "Securities
Act")) ("U.S. Person"), or in any other jurisdiction in which such an
offer would be unlawful.
Technical Disclosure
Dr Michael Roache, (PhD) - Head of Exploration, Mr Jonathan Moore -
Group Mine Geology Manager, and Mr Knowell Madambi - Technical Services
Manager all of OceanaGold, are responsible for the technical disclosure
in this document, and are Qualified Persons under the Canadian
Securities Administrators' National Instrument 43-101 - Standards of
Disclosure of Mineral Projects ("NI 43-101"). Dr Roache is a member of
both the AusIMM and Australasian Institute of Geoscientists while
Messrs. Moore and Madambi are both members and Chartered Professionals
with the AusIMM. Dr Roache, Messrs Moore and Madambi have sufficient
experience, which is relevant to the style of mineralisation and type
of deposits under consideration, and to the activities which they are
undertaking, to qualify as Competent Persons as defined in the 2004
Edition of the "Australasian Code for Reporting of Exploration Results,
Mineral Resources and Ore Reserves" ("JORC Code"). Soil samples, and
drill samples collected at 1 metre intervals or less, from both reverse
circulation chips and sawn diamond core, were prepared and assayed by
fire assay methods at either the SGS facilities at Macraes, Reefton,
Westport and Waihi, New Zealand, or the ALS facilities in Brisbane and
Townsville, Australia. Philippine soil samples were prepared and
assayed at McPhar laboratories in Manila, Philippines. Standard
reference materials were inserted to monitor the quality control of
assay data. Dr Roache and Messrs. Moore, and Madambi consent to the
inclusion in this document of the matters based on their information in
the form and context in which the information appears.
For further scientific and technical information (including disclosure
regarding mineral resources and mineral reserves) relating to the
Reefton Project, the Macraes Project and the Didipio Project please
refer to the NI 43-101 compliant technical reports available at sedar.com under the Company's name.
HIGHLIGHTS
-
Total Company gold production of 68,353 ounces and copper production of
5,710 tonnes in the second quarter of 2013.
-
Total Company gold sales were 70,706 ounces at cash costs* net of
by-product credits of $682 per ounce.
-
Didipio cash costs* on a by-product basis for the second quarter were
negative $586 per ounce on gold sales of 11,086 ounces and copper sales
of 5,073 tonnes. New Zealand cash costs* for the second quarter were
$918 per ounce on gold sales of 59,620 ounces.
-
Revenue of $131.2 million for the second quarter of 2013.
-
Commercial production at Didipio declared effective April 1, 2013. All
revenue and costs from Didipio reported to the income statement
effective this date.
-
Company announced a change to the mine schedule at Reefton whereby the
final cutback at the Globe Progress Pit has been deferred resulting in
the mine transitioning into a care and maintenance phase mid-year 2015.
-
Partnered with the International RiverFoundation to identify new
opportunities in water management and to promote and educate our
communities in managing local tributaries and initiatives to minimise
the adverse impacts from small scale mining.
All statistics are compared to the corresponding 2012 period unless
otherwise stated.
OceanaGold has adopted USD as its presentation currency and all numbers
in this document are expressed in USD unless otherwise stated.
* Cash costs and EBITDA (earnings before interest, taxes, depreciation
and amortisation, excluding gain/(loss) on undesignated hedges) are non
GAAP measures. Refer to page 24 for explanation of non GAAP measures.
OVERVIEW
Production and Costs Results
In this second quarter 2013 Management Discussion and Analysis ("MD&A"),
the revenue and costs associated with the Didipio Mine are reported to
the Consolidated Statement of Comprehensive Income. OceanaGold (the
"Company") declared commercial production at Didipio effective April 1,
2013.
The Company recorded revenue of $131.2 million in the second quarter of
2013.
Gold production for the second quarter of 2013 was 68,353 ounces (Table
1), slightly higher than in the previous quarter. The increase was
attributable to increased production from Didipio which has
successfully ramped up to commercial production rates in just over
three months from commencement of first ore through the mills in
December 2012.
In the Philippines, the second quarter cash costs net of copper
by-product credits was negative $586 per ounce and on a co-product
basis was $748 per gold equivalent ounce. The gold equivalent ounces
have been calculated by converting copper revenue using an average gold
price received of $1,270 per ounce.
In New Zealand, the second quarter cash costs were $918 per ounce on
59,620 ounces of gold sold from the operations. Cash costs were higher
than in the previous quarter on account of less capitalised pre-strip
and decreased gold in circuit.
The average gold price received by the Company in the second quarter
2013 was $1,398 per ounce versus $1,632 per ounce in the first quarter
of 2013. The average copper price received by the Company for the
quarter was $7,094 per tonne.
The Company has reviewed the carrying value of its assets and as a
result of the significant decline in the gold price and hence the
reduction in the mine schedule at Reefton (reported June 27th), an impairment charge of $85.5 million has been taken. Further detail
is outlined on Page 20.
The cash balance at the end of the quarter was $17.9 million.
The gold industry, guided by the World Gold Council (WGC) is in the
process of adopting a consistent, industry-wide standard in calculating
the All-In Sustaining Costs (AISC). On June 27, 2013, the WGC released
a guidance note on the AISC outlining the new metrics that have been
designed to provide additional transparency in the total cost to
produce an ounce of gold. In Table 2, OceanaGold has outlined its
estimated AISC for FY2013.
The Company will continue to report cash costs against its cash cost
guidance and intends to provide AISC guidance on an annual basis.
|
Table 1 - Second Quarter 2013 Production and Costs Summary
|
|
|
|
|
|
|
|
|
|
|
|
Group Operating Statistics Summary
|
|
Didipio
|
|
Macraes
|
|
Reefton
|
|
Group
|
|
|
|
|
|
|
|
|
|
|
|
Gold Produced (ounces)
|
|
13,676
|
|
40,063
|
|
14,614
|
|
68,353
|
|
Copper Produced (tonnes)
|
|
5,710
|
|
-
|
|
-
|
|
5,710
|
|
|
|
|
|
|
|
|
|
|
|
Gold sales (ounces)
|
|
11,086
|
|
42,352
|
|
17,268
|
|
70,706
|
|
Copper sales (tonnes)
|
|
5,073
|
|
-
|
|
-
|
|
5,073
|
|
Average Gold Price Received ($ per ounce)
|
|
1,270
|
|
1,422
|
|
1,398
|
|
Average Copper Price Received ($ per tonne)
|
|
7,094
|
|
-
|
|
7,094
|
|
|
|
|
|
|
|
|
|
Cash Operating Costs ($ per ounce)
|
|
(586)
|
|
918
|
|
682
|
|
|
|
|
|
|
|
|
Table 2 - FY2013 Cash Cost Guidance and All-in Sustaining Costs
Forecasts
(net of copper by-product credits)
|
|
|
|
|
|
|
|
|
|
Corporate Operating Costs Summary
|
|
|
FY2013
Cash cost guidance
(per ounce)
|
|
|
FY2013
All-in Sustaining Costs
(per ounce)
|
|
|
|
|
|
|
|
|
|
New Zealand Consolidated
|
|
|
$880 - $950
|
|
|
$1,190 - $1,260
|
|
|
|
|
|
|
|
|
|
Didipio
|
|
|
($370) - ($50)
|
|
|
($10) - $290
|
|
|
|
|
|
|
|
|
|
Group Consolidated
|
|
|
$650 - $800
|
|
|
$930 - $1,080
|
Note: Assumes NZD:USD of 0.80; expansionary and growth capital
expenditures are excluded from the AISC, these include the construction
of Didipio & Macraes tailings storage facilities as well as the various
construction projects associated with Year 1 at Didipio
Philippines Overview
Commercial production was declared at Didipio effective April 1, 2013.
In the second quarter, gold production was 13,676 ounces of gold and
5,710 tonnes of copper. In the first half of 2013, Didipio produced
20,553 ounces of gold and 9,373 tonnes of copper. The Company also
commissioned the gold gravity circuit during the quarter and shipped
the first doré from the mine for processing in Perth, Australia.
Shipments of copper-gold concentrate commenced in early April. Four
shipments were made during the quarter with an additional two shipments
completed in July. Each shipment is approximately 5,000 wet tonnes of
concentrate. The concentrate is trucked to the San Fernando port on the
west coast of Luzon where it is then loaded and shipped to markets in
Asia.
The total feed through the mill in the second quarter was 727,550 tonnes
of ore grading 0.75 g/t gold and 0.91% copper. Recoveries in the
second quarter were 77.5% gold and 87.3% copper. The head grade and
recoveries are expected to increase in the second half of the year as
mining progresses deeper into the orebody.
As reported in the first quarter, OceanaGold (Philippines), Inc. is
currently a party to a legal suit in relation to the Philippines Mining
Act and its FTAA as described later in the MD&A. The Company is working
closely with the Department of Environment and Natural Resources
(DENR), the other respondents in the case, and the mining industry to
defend the Mining Act and the validity of its FTAA.
New Zealand Operations Overview
In the second quarter, New Zealand operations produced 54,677 ounces of
gold, lower than the previous quarter but in line with expectations.
This decrease was attributable to lower grade ore processed at Macraes.
Grades were lower as a result of adjustments made to the mine schedule
in January due to the pit wall movement reported in the first quarter
and to severe wet weather that hampered mining activities over a 10-day
period in June at Macraes. During this period, low grade stockpiles
were fed through the mill. This decrease was partly offset by higher
production from Reefton due to additional tonnage mined, higher grade
ore processed and better recoveries.
Mill throughput in New Zealand for the second quarter of 2013 was 1.8
million tonnes, similar to the previous quarter. Mill feed grade in
second quarter was 1.12 g/t, lower than the previous quarter on account
of lower grade ore mined from the Macraes Open Pit and the treatment of
low grade stockpiled ore.
The overall recovery for the second quarter was 82.1%, an increase from
the previous quarter.
In light of the decline in the gold price over the past few months, the
Company has been reviewing its operations in order to maximise
profitability at each of its mines. The Company announced that the
final cutback at Reefton has been deferred and as a result, the mine
will transition into a care and maintenance phase mid-year 2015. In
order to de-risk the next two years of production at Reefton, the
Company has entered into a zero cost collar hedging program. The
program entails a series of bought gold put options at NZD1,600 per
ounce and sold call options at NZD1,787 per ounce. The reduction in
mine life at Reefton reduces the Company's capital expenditure by NZD40
- 45 million (USD32 - USD36 million) over the next two years.
At Macraes, the Company has deferred the Frasers 6 cutback pending an
improvement in the gold price. This will result in a reduction of
capitalised stripping over the next two to three years and the Company
will examine opportunities to target the mineralization through
underground mining methods.
Sustainability Overview
In the second quarter of 2013, the Company invested in infrastructure,
education and health programs at Didipio and neighbouring communities
under the Social Development Management Plan ("SDMP"). Construction of
the OceanaGold sponsored Camamasi-Belet-Capisaan-Wangal road project
connecting Didipio to the municipalities of Kasibu, Solano and Bambang
in Nueva Vizcaya continued to advance well. Additionally, the
preparation of a 12 hectare central development site at Didipio
commenced.
The Company continued its support of social service sectors through the
provision of salaries and subsidies for local high school and
elementary school teachers and community health workers. During the
quarter, nearly 1,000 community residents benefitted from free medical
consultations, medicines and eye glasses.
|
Table 3 - Key Financial Statistics for Group Operations
|
|
|
|
|
|
|
|
Group Operating Statistics Summary
|
|
|
|
Group
|
|
|
|
|
|
|
|
Gold Produced (ounces)
|
|
|
|
68,353
|
|
Copper Produced (tonnes)
|
|
|
|
5,710
|
|
|
|
|
|
|
|
Gold sales (ounces)
|
|
|
|
70,706
|
|
Copper sales (tonnes)
|
|
|
|
5,073
|
|
Average Gold Price Received ($ per ounce)
|
|
|
|
1,398
|
|
Average Copper Price Received ($ per tonne)
|
|
|
|
7,094
|
|
|
|
|
|
|
|
Cash Operating Costs * ($ per ounce)
|
|
|
|
682
|
* net of by-product copper credits
|
|
|
|
|
|
|
Table 4 - Key Financial Statistics for Didipio Operations
|
|
|
|
|
|
|
|
Didipio Financial Statistics
|
|
|
|
Q2
Jun 30 2013
|
|
|
|
|
|
|
|
Gold Sales (ounces)
|
|
|
|
11,086
|
|
Copper Sales (tonnes)
|
|
|
|
5,073
|
|
|
|
|
|
|
|
|
|
|
|
USD
|
|
|
|
|
|
|
|
Average Price Received ($ per ounce)
|
|
|
|
1,270
|
|
Average Price Received Copper ($ / tonne)
|
|
|
|
7,094
|
|
|
|
|
|
|
|
Cash Operating Costs * ($ per ounce)
|
|
|
|
(586)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Operating Margin * ($ per ounce)
|
|
|
|
1,856
|
* net of by-product copper credits
|
|
|
|
|
|
|
|
|
Table 5 - Key Operating Statistics for Didipio Operations
|
|
|
|
|
|
|
|
|
|
Didipio Operating Statistics
|
|
|
Q2
Jun 30 2013
|
|
|
Q1
Mar 31 2013
|
|
|
|
|
|
|
|
|
|
Gold Produced (ounces)
|
|
|
13,676
|
|
|
6,877
|
|
Copper Produced (tonnes)
|
|
|
5,710
|
|
|
3,663
|
|
|
|
|
|
|
|
|
|
Total Ore Mined (tonnes)
|
|
|
1,729,314
|
|
|
1,837,081
|
|
|
|
|
|
|
|
|
|
Ore Mined Grade Gold (grams/tonne)
|
|
|
0.55
|
|
|
0.49
|
|
Ore Mined Grade Copper (%)
|
|
|
0.64
|
|
|
0.65
|
|
|
|
|
|
|
|
|
|
Total Waste Mined (tonnes) including pre-strip
|
|
|
4,342,999
|
|
|
2,750,042
|
|
|
|
|
|
|
|
|
|
Mill Feed (dry milled tonnes)
|
|
|
727,550
|
|
|
448,703
|
|
|
|
|
|
|
|
|
|
Mill Feed Grade Gold (grams/tonne)
|
|
|
0.75
|
|
|
0.59
|
|
Mill Feed Grade Copper (%)
|
|
|
0.91
|
|
|
0.92
|
|
|
|
|
|
|
|
|
|
Recovery Gold (%)
|
|
|
77.5
|
|
|
79.8
|
|
Recovery Copper (%)
|
|
|
87.3
|
|
|
88.6
|
Note: Q1 figures are pre-commercial production
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 6 - Key Financial Statistics for New Zealand Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Statistics for New Zealand Operations
|
|
|
Q2
Jun 30 2013
|
|
|
Q1
Mar 31 2013
|
|
|
Q2
Jun 30 2012
|
|
|
Half Year
Jun 30 2013
|
|
|
Half Year
Jun 30 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gold Sales (ounces)
|
|
|
59,620
|
|
|
58,585
|
|
|
53,756
|
|
|
118,205
|
|
|
105,608
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
USD
|
|
|
USD
|
|
|
USD
|
|
|
USD
|
|
|
USD
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Price Received ($ per ounce)
|
|
|
1,422
|
|
|
1,632
|
|
|
1,613
|
|
|
1,526
|
|
|
1,660
|
|
Cash Operating Cost ($ per ounce)
|
|
|
918
|
|
|
687
|
|
|
1,029
|
|
|
804
|
|
|
1,077
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash Operating Margin
($ per ounce)
|
|
|
504
|
|
|
945
|
|
|
584
|
|
|
722
|
|
|
583
|
|
Table 7 - Key Operating Statistics for New Zealand Operations
|
|
|
|
|
|
|
|
|
|
|
|
|
Combined Operating Statistics for
New Zealand Operations
|
|
Q2
Jun 30 2013
|
|
Q1
Mar 31 2013
|
|
Q2
Jun 30 2012
|
|
Half Year
Jun 30 2013
|
|
Half Year
Jun 30 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gold Produced (ounces)
|
|
54,677
|
|
60,586
|
|
55,709
|
|
115,263
|
|
106,551
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Ore Mined (tonnes)
|
|
1,789,769
|
|
1,985,330
|
|
1,571,658
|
|
3,775,099
|
|
2,979,007
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ore Mined Grade (grams/tonne)
|
|
1.06
|
|
1.31
|
|
1.29
|
|
1.19
|
|
1.29
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Waste Mined (tonnes) including pre-strip
|
|
13,818,227
|
|
16,389,898
|
|
14,006,959
|
|
30,208,125
|
|
27,615,741
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mill Feed (dry milled tonnes)
|
|
1,831,729
|
|
1,798,616
|
|
1,909,670
|
|
3,630,345
|
|
3,716,374
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mill Feed Grade (grams/tonne)
|
|
1.12
|
|
1.28
|
|
1.15
|
|
1.20
|
|
1.12
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Recovery (%)
|
|
82.1
|
|
79.8
|
|
79.0
|
|
81.1
|
|
80.2
|
|
Table 8 - Macraes Operating Statistics
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Macraes Operating Statistics
|
|
Q2
Jun 30 2013
|
|
Q1
Mar 31 2013
|
|
Q2
Jun 30 2012
|
|
Half Year
Jun 30 2013
|
|
Half Year
Jun 30 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gold Produced (ounces)
|
|
40,063
|
|
48,139
|
|
39,012
|
|
88,202
|
|
73,863
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Ore Mined (tonnes)
|
|
1,414,405
|
|
1,643,432
|
|
1,303,293
|
|
3,057,837
|
|
2,391,530
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ore Mined Grade (grams/tonne)
|
|
0.96
|
|
1.28
|
|
1.23
|
|
1.13
|
|
1.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Waste Mined (tonnes) including pre-strip
|
|
9,432,040
|
|
12,393,410
|
|
9,226,327
|
|
21,825,450
|
|
18,409,342
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mill Feed (dry milled tonnes)
|
|
1,442,860
|
|
1,462,409
|
|
1,477,749
|
|
2,905,269
|
|
2,869,809
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mill Feed Grade (grams/tonne)
|
|
1.04
|
|
1.27
|
|
1.03
|
|
1.16
|
|
1.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Recovery (%)
|
|
81.8
|
|
80.2
|
|
79.1
|
|
81.0
|
|
79.9
|
|
Table 9 - Reefton Operating Statistics
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reefton Operating Statistics
|
|
Q2
Jun 30 2013
|
|
Q1
Mar 31 2013
|
|
Q2
Jun 30 2012
|
|
Half Year
Jun 30 2013
|
|
Half Year
Jun 30 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gold Produced (ounces)
|
|
14,614
|
|
12,447
|
|
16,697
|
|
27,061
|
|
32,688
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Ore Mined (tonnes)
|
|
375,364
|
|
341,898
|
|
268,365
|
|
717,262
|
|
587,477
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ore Mined Grade (grams/tonne)
|
|
1.45
|
|
1.47
|
|
1.57
|
|
1.46
|
|
1.66
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Waste Mined (tonnes) including pre-strip
|
|
4,386,187
|
|
3,996,488
|
|
4,780,632
|
|
8,382,675
|
|
9,206,399
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mill Feed (dry milled tonnes)
|
|
388,869
|
|
336,207
|
|
431,921
|
|
725,076
|
|
846,565
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mill Feed Grade (grams/tonne)
|
|
1.41
|
|
1.35
|
|
1.53
|
|
1.38
|
|
1.49
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Recovery (%)
|
|
83.1
|
|
78.3
|
|
78.8
|
|
81.2
|
|
80.9
|
PRODUCTION
Gold production for the second quarter of 2013 was 68,353 ounces,
slightly higher than in the previous quarter due to increased
production from Didipio and from Reefton. The increase was offset by
lower production from Macraes. Copper production from Didipio for the
quarter was 5,710 tonnes.
The Company has been reviewing its operations in order to maximise
profitability at each of its mines. On June 27, the Company announced a
change to the mine schedule at Reefton whereby the final cutback at the
Globe Progress Pit has been deferred resulting in a two year reduction
in the mine schedule and the mine transitioning into a care and
maintenance phase mid-year 2015 pending an improvement in the gold
price to extract the remaining resource. In order to de-risk the
production at Reefton, the Company entered into a zero cost collar
hedging program over the estimated 115,650 ounces of gold production
during that period. The program entails a series of bought gold put
options at NZD1,600 per ounce and sold call options at NZD1,787 per
ounce. The reduction in mine life at Reefton reduces the Company's
capital expenditure by NZD40 - 45 million (USD32 - 36 million) over the
next two years.
At Macraes, the Company has deferred the Frasers 6 cutback pending an
improvement in the gold price. This will result in a reduction of
capitalised stripping over the next two to three years and the Company
will examine opportunities to target the mineralization through
underground mining methods.
Didipio Mine (Philippines)
In the second quarter of 2013, the Didipio Mine incurred no lost time
injuries and as at the end of June 2013, the operations had recorded
over five million man hours worked without a lost time injury.
In the second quarter, gold production was 13,676 ounces of gold and
5,710 tonnes of copper. Didipio has produced 20,553 ounces of gold and
9,373 tonnes of copper year-to-date. The gravity circuit was
commissioned in the second quarter and produced its first doré in May
which was subsequently shipped for processing in Perth, Australia.
In the second quarter, the Company made four shipments of copper-gold
concentrate totalling approximately 20,000 dry metric tonnes from the
San Fernando port on the west coast of Luzon to markets in Asia.
Mining operations in the second quarter focused on providing supply to
the process plant, building stockpiles on the ROM pad and on providing
competent waste rock for the stage 2 lift of the Tailings Storage
Facility(TSF). The construction of the second stage of the TSF lift is
on target for completion in the third quarter.
The total material movement in the second quarter was 6.1 million tonnes
including 1.7 million tonnes of ore, most of which was stockpiled.
The total feed through the mill in the second quarter was 727,550 tonnes
of ore, grading 0.75 g/t gold and 0.91% copper. Recoveries in the
second quarter were 77.5% gold and 87.3% copper. The head grade and
recoveries are expected to increase in the second half of the year as
mining progresses deeper into the orebody.
As stated in the first quarter 2013 report, the Department of
Environment and Natural Resources of the Philippines ("DENR"), along
with a number of mining companies (including OceanaGold Philippines
Inc.), are parties to a case that began in 2008 whereby a group of
Non-Governmental Organisations (NGOs) and individuals challenged the
constitutionality of the Philippines Mining Act ("Mining Act") and the
Financial or Technical Assistance Agreements ("FTAAs") in the
Philippines Supreme Court. The petitioners initiated the challenge
despite the fact that the Supreme Court had upheld the constitutional
validity of both the Mining Act and the FTAAs in an earlier landmark
case in 2005. The parties made various written submissions in 2009 and
2010, and there were no significant developments in the case between
2011 and 2012. In early 2013, the Supreme Court requested the parties
to participate in oral debates on the issue, which has generated some
media interest in the matter. The oral debates are continuing and it
is expected that further written submissions will be requested by the
Court over the second half of the year before a decision is handed
down. Notwithstanding the favourable legal precedent, the Company is
cognisant that litigation is an inherently uncertain process and that
the outcome of the case may adversely affect the operation and
financial position of the Company. Therefore, it is working closely
with the DENR, the other respondents in the case, and the mining
industry to defend the Mining Act and the validity of its FTAA.
Macraes Goldfield (New Zealand)
The operation sustained one lost time injury during the quarter when an
underground miner was injured. The Company has investigated the
incident and has renewed the focus on task based observations made by
supervisors and management.
Production from the Macraes Goldfield was 40,063 gold ounces, compared
to 48,139 gold ounces in the previous quarter. This decrease was
attributable mainly to lower grade ore processed. Grades were lower as
a result of adjustments made to the mine schedule in January due to the
pit wall movement reported in the first quarter and to severe wet
weather that hampered mining activities over a 10-day period in June.
During this period, low grade stockpiles were fed through the mill.
The inclement weather at Macraes in June consisted of rain for a seven
day period including two days of heavier rainfall resulting in 130
millimetres of accumulation which was then followed by 700 millimetres
of snow over the following three days. As a result, the pit floor in
the eastern section of the open pit became flooded restricting access
to higher grade ore and required restoration of some haul roads. The
Company expects to have the pit pumped out over the course of the next
two months subject to weather conditions. An adjustment to the mine
schedule has been made with mining of the higher grade eastern section
of the pit to commence late in the third quarter and into the fourth
quarter. The Company now expects production in New Zealand to
progressively increase over the remainder of the year with the
strongest quarter being the fourth quarter.
Mining activities continued in the Frasers 5 and Frasers West areas.
During the quarter, the Company continued to review the operations at
Macraes to maximise profitability due to the decrease in gold price. As
a result, the Company has deferred pre-stripping of the Frasers 6
cutback. This will have no impact on production over the near-term but
could affect production in later years of the mine life which is
currently projected to 2020 barring changes to the gold price.
The total material movement from the open pit decreased 23% due to the
major rain and snow storms in June and to the deferment of the
pre-stripping at Frasers 6 cutback.
At the Frasers Underground, mining continued in Panel 2 with a small
amount of ore mined from Panel 1. Ore mined was up slightly on the
previous quarter at 219,980 tonnes.
Mill throughput of 1.4 million tonnes was similar to the previous
quarter as low grade stockpiled ore was milled in place of mined ore
during the weather event. The mill feed grade of 1.04 g/t was lower
than the previous quarter due to lower grade ore mined from the open
pit and the need to mill lower grade stockpile ore during the weather
event in June.
Overall recovery was 81.8% compared to 80.2% in the previous quarter. In
the first quarter, the autoclave was unavailable for a period of 24
days due to a planned rebricking. As a result, the ore bypassed the
autoclave and was directly leached resulting in lower CIL recoveries.
With the maintenance work completed in the first quarter, the autoclave
had higher availability in the second quarter thus direct leaching was
not required resulting in higher CIL recoveries.
Reefton Goldfield (New Zealand)
In the second quarter of 2013 there was one LTI recorded at the Reefton
operation when a mining technician strained his back lifting equipment.
The worker returned to work after a few days of recovery. Retraining of
the proper lifting techniques was delivered to the operations
personnel.
Gold production from the Reefton Goldfield was 14,614 ounces versus
12,447 ounces in the previous quarter. This increase was driven
primarily by additional tonnes milled but also by slightly higher
grades and improved recoveries over the previous quarter. The Company
mined ore from both the Globe Pit and the Empress Pit during the
quarter. The Empress Pit is a mineralised open pit that had been
previously mined and the updated resource model identified remaining
ore to be accessed. Empress will revert to a waste stack later in the
year when the ore has been completely mined.
Mining activities continued with the development of the stage 6 and
stage 7 cutbacks including the associated pre-strip and waste
movements. These developments will support the exposure of ore, which
will be mined over the balance of the mine schedule to mid-year 2015.
The final cutback (stage 8) has been deferred pending an improvement in
the gold price to extract the remaining resource.
The total ore mined for the second quarter was 375,364 tonnes, a 10%
increase from the previous quarter. The increase was due to additional
ore available for mining from the Empress Pit. Additionally, the
operations had shorter haulage cycles compared to the previous quarter
where haulage cycles were longer due to restricted access to the
process plant during the relocation of the tailings delivery pipeline,
which was completed early in the second quarter.
Process plant throughput was 388,869 tonnes at 1.41 g/t in the second
quarter versus 336,207 tonnes at 1.35 g/t in the previous quarter.
Gold recovery for the quarter increased from 78.3% in the previous
quarter to 83.1% in the second quarter of 2013. The increase in
recovery was as a result of more consistent ore feed grade throughout
the quarter.
EXPLORATION
Philippines
Exploration expenditure in the Philippines for the second quarter of
2013 totalled $0.6 million.
Exploration drilling within the Didipio near-mine area commenced during
the quarter (Mine permit area; Figure 1). A single 461 metre hole was
completed at the Morning Star prospect (drill hole MSDH212). In late
June, drilling commenced at the D'Beau prospect (drill hole DBDH202).
Drilling within the Morning Star prospect, located 700 metres southwest
of Didipio intersected monzonite porphyry intrusion from 288 metres to
331 metres with intermittent narrow monzonite dikes from 350 metres to
400 metres (Figure 1). The monzonite contains weak copper
mineralization in the form of chalcopyrite-pyrite-quartz veinlets.
Assays are pending.
On the D'Beau prospect, about one kilometre southwest of Didipio, the
first of a four-hole drilling program commenced. The first hole is
intended to test for coherent mineralised intrusion below the artisanal
workings (Figure 1).
At the Cabinwangan prospect located to the northwest of Didipio, channel
samples were assayed returning results of 6 metres averaging 1.4 g/t Au
and 1.22% Cu. Additional work is planned in the second half of this
year to further delineate surface mineralisation and define potential
drill targets.
New Zealand
Exploration expenditure in New Zealand for the second quarter was $1.1
million.
Reefton Goldfield
During the second quarter, exploration activity at Reefton moved from
target drilling to target generation. A desktop study was completed in
the quarter which assessed the structural setting of all the
significant gold mineralisation occurrences in the Reefton Goldfield.
The study identified several important structural attributes that
appear critical for the formation of an economic gold deposit in the
Reefton Goldfield. Identifying these structural attributes in the field
through detail (1:500 scale) mapping will drive future target rankings.
At the Globe Progress Pit an updated resource estimate was compiled
incorporating an infill diamond drill program completed in late 2012.
In addition, an updated resource estimate for the Supreme prospect
located 2.5 kilometres south of the Reefton operation was completed.
Both of these updates will be integrated into the annual end of year
update.
Macraes Goldfield
During the second quarter, the Company completed infill and step out
resource definition drilling at the Coronation prospect, which is
located at the northern end of the Hyde Macraes Shear Zone (Figure 2).
The drilling program comprised of 56 holes for 4,500 meters. An updated
resource estimate has been compiled which will be integrated into the
annual end of year update.
Following the Coronation drilling program, the Company's focus moved
south to the Deepdell prospect where a program of 23 holes for 2,845
metres of resource infill and step out drilling were completed by
quarter's end. As at the end of the quarter, results of this drilling
were still outstanding.
Figure 1 - Didipio FTAA and Exploration Areas
Figure 2 - Macraes Exploration drilling showing the location of infill
drilling at the Coronation prospect and proposed drilling program at
the Deepdell prospect.
Project Development
Project works at Didipio continued in the second quarter to provide life
of mine maintenance and ancillary accommodation infrastructure such as
the permanent mine maintenance workshop, process plant workshop, heavy
vehicle wash facilities and employee gym facility. These works are on
track for completion by the fourth quarter of 2013.
Scoping studies continued to progress well. These studies include the
high voltage power line supply to site and the Didipio mine
optimisation. Results of these studies will be completed in the second
half of 2013.
In New Zealand, construction of stage 1 of the new tailings storage
facility at Macraes continued during the quarter. Major foundation work
was completed, under drains installed and embankment fill material
placed to a dam height of about six metres. Construction of the new
tailings storage facility is expected to be completed by the end of the
year.
Sustainability
In the second quarter of 2013, the Company continued to invest through
the Social Development Management Plan ("SDMP") in infrastructure and
education and health programs at Didipio and neighbouring communities.
These community development initiatives were primarily focused on
access road improvements, salary and subsidy assistance, enterprise
development and agriculture.
Construction of the OceanaGold sponsored Camgat-Surong road improvement
project was completed in the second quarter. The
Camamasi-Belet-Capisaan-Wangal road project connecting Didipio to the
municipalities of Kasibu, Solano and Bambang in Nueva Vizcaya continued
to advance well in the quarter. The Company has spent approximately 50%
of its planned US$1.4 million expenditure to date. The Company also
undertook the construction of hanging bridges, rehabilitation and
extensions on two community halls, construction of school facilities
and as well as church improvements in Didipio and surrounding
communities.
In the quarter, the development of a 12 hectare central development site
at Didipio commenced with upgrades to the access roads, site levelling
and the start of the new Didipio high school. The Company retained the
services of an urban development planner to prepare the overall design
of the site.
The Company continued its support of social service sectors through the
provision of salaries and subsidies for local high school and
elementary school teachers and community health workers. Medical,
dental and optical missions were carried out in the quarter where
nearly 1,000 community residents benefitted from free medical
consultations, medicines and eye glasses.
In the second quarter, the Company renewed the road maintenance contract
and signed a new copper concentrate hauling contract with DiCorp, a
mine services corporation owned by the long term residents of Didipio.
Preparations for the development of the central nursery in the Barangay
Tucod for the agroforestry programs of the company are on-going while
identification of the planting sites for an additional 100 hectares is
underway through close coordination with the Environment and Natural
Resources offices both from the provincial and local governments.
In the second quarter, the Company partnered with the International
RiverFoundation (IRF). The IRF is an international public benefit
organisation that works in partnerships around the world to fund and
promote the sustainable restoration and management of river basins. The
IRF's vision is to achieve improved ecosystem and human health with
positive economic and social outcomes through integrated river basin
management. Together with the IRF, OceanaGold will identify new
opportunities in water management and will promote and educate members
of its communities to become champions in sustainable rivers through
the effective management of local tributaries and initiatives to
minimise the adverse impacts from small scale mining.
FINANCIAL SUMMARY
The table below provides selected financial data comparing Q2 2013 with
Q1 2013 and Q2 2012.
|
|
|
|
|
|
|
|
STATEMENT OF OPERATIONS
|
Q2
Jun 30 2013
$000
|
Q1
Mar 31 2013
$000
|
Q2
Jun 30 2012
$000
|
Half Year
Jun 30 2013
$000
|
Half Year
Jun 30 2012
$000
|
|
Sales
|
131,213
|
95,639
|
86,719
|
226,852
|
175,277
|
Cost of sales, excluding depreciation and
amortisation
|
(80,437)
|
(39,875)
|
(57,523)
|
(120,312)
|
(118,211)
|
|
General & Administration
|
(6,764)
|
(6,162)
|
(3,561)
|
(12,926)
|
(6,655)
|
|
Foreign Currency Exchange Gain/(Loss)
|
(1,528)
|
(418)
|
(31)
|
(1,947)
|
(1,652)
|
|
Other income/(expense)
|
11
|
(2,108)
|
28
|
(2,097)
|
158
|
Earnings before interest, tax, depreciation
& amortisation (EBITDA) (excluding
gain/(loss) on undesignated hedges and
impairment charge)
|
42,495
|
47,076
|
25,632
|
89,570
|
48,917
|
|
Depreciation and amortisation
|
(39,824)
|
(29,547)
|
(20,009)
|
(69,371)
|
(41,832)
|
|
Net interest expense and finance costs
|
(6,322)
|
(6,376)
|
(4,034)
|
(12,698)
|
(8,036)
|
Earnings/(loss) before income tax and
gain/(loss) on undesignated hedges and
impairment charge
|
(3,651)
|
11,153
|
1,589
|
7,501
|
(951)
|
|
Tax (expense)/ benefit on earnings/loss
|
1,004
|
(4,663)
|
(854)
|
(3,659)
|
(2,177)
|
Earnings/(loss) after income tax and
before gain/(loss) on undesignated
hedges and impairment charge
|
(2,647)
|
6,490
|
735
|
3,842
|
(3,128)
|
|
Impairment charge
|
(85,500)
|
-
|
-
|
(85,500)
|
-
|
Gain/(loss) on fair value undesignated
hedges
|
(8,977)
|
813
|
-
|
(8,164)
|
-
|
Tax (expense)/benefit on gain/loss on
undesignated hedges and impairment
|
26,633
|
(244)
|
-
|
26,389
|
-
|
|
Net Profit/(loss)
|
(70,491)
|
7,059
|
735
|
(63,432)
|
(3,128)
|
|
Basic / Diluted earnings per share
|
$(0.24)
|
$0.02
|
$0.00
|
$(0.22)
|
$(0.01)
|
|
CASH FLOWS
|
|
Cash flows from Operating Activities
|
9,864
|
21,441
|
20,912
|
31,305
|
41,729
|
|
Cash flows used in Investing Activities
|
(25,218)
|
(64,982)
|
(69,261)
|
(90,200)
|
(134,406)
|
|
Cash flows used in Financing Activities
|
(4,459)
|
(25,710)
|
(4,561)
|
(30,169)
|
(8,176)
|
|
|
|
|
|
BALANCE SHEET
|
As at
Jun 30 2013
$'000
|
As at
Dec 31 2012
$'000
|
|
Cash and cash equivalents
|
17,924
|
96,502
|
|
Other Current Assets
|
131,184
|
89,276
|
|
Non Current Assets
|
767,080
|
845,878
|
|
Total Assets
|
916,188
|
1,031,656
|
|
Current Liabilities
|
215,527
|
199,413
|
|
Non Current Liabilities
|
154,627
|
222,383
|
|
Total Liabilities
|
370,154
|
421,796
|
|
Total Shareholders' Equity
|
546,034
|
609,860
|
RESULTS OF OPERATIONS
Net Earnings
The Company declared commercial production at Didipio effective April 1
2013. As such, the revenue and costs associated with the Didipio Mine
are reported to the Consolidated Statement of Comprehensive Income on a
consolidated basis in the second quarter.
In the second quarter, the Company reported a net loss of $70.5 million
versus a net profit of $7.1 million in the first quarter 2013. The loss
was associated with an impairment charge, net foreign exchange hedging
losses, lower average gold price received, lower capitalised pre-strip,
decreased gold in circuit and increased depreciation and amortisation
in New Zealand. The net loss was offset by a weaker New Zealand dollar
and the contribution made by the Philippines operations.
The Company reported EBITDA (excluding loss on undesignated hedge and
impairment charge) of $42.5 million in the second quarter of 2013
compared to $47.1 million in the first quarter of 2013.
The earnings before income tax and before gain/(loss) on undesignated
hedges and impairment charge was a loss of $3.6 million for the second
quarter of 2013 compared to a profit of $11.2 million in the first
quarter of 2013.
Sales Revenue
Philippines
Sales revenue (net of metal deductions and selling costs) in Philippines
was $46.4 million of which copper sales revenue was $36.0 million (nil
in first quarter 2013).
The average gold price received was $1,270 per ounce, and the average
copper price received was $7,094 per tonne.
New Zealand
Gold revenue in New Zealand in the second quarter was $84.8 million
compared with the first quarter of $95.6 million. This 11% decrease
over the previous quarter was due mainly to a lower average price of
gold received that was offset by a slightly higher number of ounces
sold.
The average gold price received in the second quarter was $1,422 per
ounce compared to $1,632 per ounce received in the previous quarter for
New Zealand. Gold sold in the second quarter was 59,620 ounces compared
to the first quarter of 58,585 ounces. This increase in ounces sold was
due mainly to a reduction of gold in circuit at Reefton with more
ounces being processed, offset by lower ounces produced at Macraes.
Operating Costs and Margins per Ounce
Philippines
Operating cash costs (net of copper by-product credits) was negative
$586 per ounce sold for the second quarter.
New Zealand
Operating cash costs per ounce sold was $918 for the second quarter of
2013, compared to $687 per ounce in the first quarter 2013. This result
was largely attributable to lower capitalised pre-strip costs and a
decrease in gold in circuit.
The average cash margin was $504 per ounce for the second quarter 2013
versus $945 for the first quarter 2013. This reflected the lower
average gold price received per ounce and the higher cash cost per
ounce sold.
Depreciation and Amortisation
Depreciation and amortisation charges include amortisation of mine
development, deferred pre- stripping costs and depreciation on
equipment.
Depreciation and amortisation charges are mostly calculated on a unit of
production basis and totalled $39.8 million for the second quarter 2013
compared to $29.5 million in the previous quarter. The second quarter
included depreciation and amortisation for the Philippines operations
for the first time.
Impairment Charge
An impairment charge of $85.5 million was recognised this quarter, after
an impairment assessment was made on the New Zealand cash generating
unit. More details on the impairment charge are noted on page 20
Critical Accounting Estimates and Judgement.
Net Interest Expense and Finance Costs
The net interest expense and finance costs of $6.3 million for the
quarter were in line with the previous quarter.
Undesignated Hedges Gains/Losses
Unrealised gains and losses calculated as a fair value adjustment of the
Company's undesignated hedges are brought to account at the end of each
reporting period and reflect changes in the spot gold price and changes
in market premiums of AUD forwards. These valuation adjustments as at
June 30, 2013, reflect a loss of $9.0 million compared to a gain for
the first quarter of $0.8 million.
Details of the derivative instruments held by the Company at year end
are summarised below under "Derivative Assets/ Liabilities".
DISCUSSION OF CASH FLOWS
Operating Activities
Cash inflows from operating activities were $9.9 million for the second
quarter of 2013 compared to $21.4 million in the previous quarter. The
decrease was the result of lower average gold price received, higher
costs of sales and working capital increases, offset partly by higher
group ounces of gold sold and copper sales in the Philippines.
Investing Activities
Cash used for investing activities totalled $25.2 million in the second
quarter of 2013 compared to $65.0 million in the first quarter of 2013.
Investing activities comprised expenditures for pre-strip capitalised
mining expenditure, sustaining capital and exploration expenditure at
both the New Zealand and Philippines operations. At the Didipio Mine,
expansionary capital expenditures included the stage 2 tailings storage
facility lift and the purchase of trucks for copper-gold concentrate
haulage.
Financing Activities
Financing net outflows for the second quarter of 2013 were $4.5 million
compared to a net outflow of $25.7 million in the last quarter.
DISCUSSION OF FINANCIAL POSITION AND LIQUIDITY
Company's funding and capital requirements
For the quarter ended June 30, 2013, the Company recorded a net loss of
$70.5 million. As at that date, cash funds held were $17.9 million. Net
current liabilities were $66.4 million at quarter end which includes a
current liability of the convertible bonds repayment due in December
2013.
At June 30, 2013, undrawn funds from the banking facilities established
in 2012 were $141.8 million. This undrawn amount includes the term
facility that will be used to cover the A$110.8 million convertible
notes that mature in December 2013. With the additional $30 million
available under the revolving credit facility, the Company had
immediately available liquidity of $47.9 million.
Additionally, the Company has a $25 million convertible revolving credit
facility whereby it has the option to repay any drawn down funds with
cash or the issuance of ordinary shares under this facility, subject to
the ASX listing rules.
Commitments
OceanaGold's capital commitments as at June 30, 2013 are as follows:
|
|
|
|
|
June 30, 2013
$'000
|
|
Within 1 year
|
29,812
|
|
|
|
This includes mainly equipment for New Zealand operations and contracts
supporting the operations of the Didipio Mine.
Financial Position
Current Assets
Current assets were $149.1 million compared to $185.8 million at the end
of the prior year. The reduction in the current assets of $36.7 million
was due mainly to a decrease in cash used for repaying net debt of $20
million in the first quarter and financing Didipio operations prior to
first shipment, offset partly by increases in inventories, trade
receivables, and prepayments.
Non-Current Assets
Non-current assets were $767.1 million compared to $845.9 million at
December 31, 2012. The decrease mainly reflects the impairment charge
recognised this quarter which reduced the carrying value of mining
assets and property, plant and equipment, partly offset by increases in
input tax credits paid, increases in capitalised mining costs, and
additions to property, plant and equipment..
Current Liabilities
Current liabilities were $215.5 million as at June 30, 2013 compared to
$199.4 million as at December 31, 2012. This increase was attributable
mainly to the reclassification of $25 million of the working capital
facility from non-current to current being a tranche repayable June
2014, offset by a decrease in trade creditors, a lesser convertible
note liability as a result of the strengthening of the United States
dollar and an increase in derivatives liability related to the
Australian dollar foreign exchange forwards.
Non-Current Liabilities
Non-current liabilities were $154.6 million as at June 30, 2013,
compared with $222.4 million at December 31, 2012. The decrease
resulted from a net repayment of $20 million of the working capital
banking facilities in the first quarter, and a decrease in deferred tax
liabilities which was also impacted by the impairment charge recognised
in the quarter.
Derivative Assets / Liabilities
In prior year, the Company had purchased forward contracts as a hedge
against foreign exchange movements to ensure that the potential US
denominated credit facility draw downs would be sufficient in the
repayment of the AUD denominated convertible notes. As at June 30,
2013, a forward purchase contract for A$110.8 million remained
outstanding, maturing in December 2013.
On June 24, 2013, the Company entered into a gold bullion collar zero
cost agreement to buy gold puts at average strike NZD1,600 per ounce
and sell gold calls at average strike NZD1,787 per ounce for 115,650
ounces for the period from July 2013 to June 2015.
The above hedges are undesignated and do not qualify for hedge
accounting.
A summary of OceanaGold's marked to market derivatives is as per below:
|
|
|
|
|
|
Jun 30 2013
$'000
|
Dec 31 2012
$'000
|
|
Current Assets
|
|
|
|
|
Forward rate
agreements
|
2,351
|
552
|
|
|
|
|
|
Gold put/call options
|
2,006
|
89
|
|
|
|
|
|
|
4,357
|
641
|
|
|
|
|
|
Non Current Assets
|
|
|
|
|
|
|
|
|
|
Gold put/call options
|
1,980
|
-
|
|
|
|
|
|
Total Assets
|
6,337
|
641
|
|
|
|
|
|
|
Jun 30 2013
$'000
|
Dec 31 2012
$'000
|
|
Current Liabilities
|
|
|
|
|
Forward rate
agreements
|
13,593
|
151
|
|
|
|
|
|
Total Liabilities
|
13,593
|
151
|
|
|
|
|
Shareholders' Equity
A summary of the movement in shareholders' equity is set out below:
|
|
|
|
|
Period Ended
June 30, 2013
$'000
|
Total equity at beginning of
financial period
|
620,920
|
|
|
|
|
Profit/(loss) after income tax
|
(70,491)
|
|
|
|
Movement in other
comprehensive income
|
(5,112)
|
|
|
|
Movement in contributed
surplus
|
542
|
|
|
|
Issue of shares/ (Equity
raising costs)
|
175
|
|
|
|
Total equity at end of
financial period
|
546,034
|
|
|
|
Shareholders' equity has decreased by $74.9 million to $546.0 million at
June 30, 2013, mainly as a result of a net loss after tax for the
quarter of $70.5 million, and currency translation differences
reflected in "Other Comprehensive Income" that arise from the
translation of entities with a functional currency other than USD.
Capital Resources
As at June 30, 2013, the share and securities summary was:
|
Shares outstanding
|
|
|
|
|
293,574,584
|
|
|
|
|
|
|
|
|
Options and share rights outstanding
|
|
|
|
|
9,839,456
|
As at July 25, 2013 there was no change in shares and securities:
|
Shares outstanding
|
|
|
|
|
293,574,584
|
|
|
|
|
|
|
|
|
Options and share rights outstanding
|
|
|
|
|
9,839,456
|
As at December 31, 2012, the share and securities summary was:
|
Shares outstanding
|
|
|
|
|
293,517,918
|
|
|
|
|
|
|
|
|
Options and share rights outstanding
|
|
|
|
|
8,624,268
|
CRITICAL ACCOUNTING ESTIMATES AND ACCOUNTING POLICIES
The preparation of financial statements in conformity with IFRS requires
management to make estimates and assumptions that affect the amounts
reported in the consolidated financial statements and related notes.
Exploration and Evaluation Expenditure
Exploration and evaluation expenditure is stated at cost and is
accumulated in respect of each identifiable area of interest.
Such costs are only carried forward to the extent that they are expected
to be recouped through the successful development of the area of
interest (or alternatively by its sale), or where activities in the
area have not yet reached a stage which permits a reasonable assessment
of the existence or otherwise of economically recoverable resources,
and active work is continuing.
Accumulated costs in relation to an abandoned area are written off to
the Statement of Operations in the period in which the decision to
abandon the area is made.
A regular review is undertaken of each area of interest to determine the
appropriateness of continuing to carry forward costs in relation to
that area of interest.
Mining Properties in Production or Under Development
Expenditure relating to mining properties in production and development
are accumulated and brought to account at cost less accumulated
amortisation in respect of each identifiable area of interest.
Amortisation of capitalised costs, including the estimated future
capital costs over the life of the area of interest, is provided on the
production output basis, proportional to the depletion of the mineral
resource of each area of interest expected to be ultimately
economically recoverable.
Costs associated with the removal of overburden and other mine waste
materials that are incurred in the production phase of mining
operations are included in the costs of inventory in the period in
which they are incurred, except when the charges represent getting
better access to a component of the mineral property.
Charges are capitalised when the stripping activity provides better
access to components of the ore body and reserves that will be produced
in future periods that would not have been accessible without the
stripping activity. When charges are deferred in relation to such
activity, the charges are amortised over the reserve in the betterment
accessed by the stripping activity using the units of production
method.
A regular review is undertaken of each area of interest to determine the
appropriateness of continuing to carry forward costs in relation to
that area of interest. Should the carrying value of expenditure not
yet amortised exceed its estimated recoverable amount, the excess is
written off to the Statement of Comprehensive Income.
Asset Retirement Obligations
OceanaGold recognises the present value of future asset retirement
obligations as a liability in the period in which it incurs a legal
obligation associated with the retirement of long-lived assets that
results from the acquisition, construction, development and/or normal
use of the assets. OceanaGold concurrently recognises a corresponding
increase in the carrying amount of the related long-lived asset that is
depreciated over the life of the asset.
The key assumptions on which the present value of the asset retirement
obligations are based include the estimated risk-adjusted future
cash flows, the timing of those cash flows and the risk-free rate or
rates on which the estimated cash flows have been discounted.
Subsequent to the initial measurement, the liability is accreted over
time through periodic charges to earnings. The amount of the liability
is subject to re-measurement at each reporting period if there has been
a change to the key assumptions.
Asset Impairment Evaluations
The carrying values of exploration, evaluation, mining properties in
production or under development and plant and equipment are reviewed
for impairment when events or changes in circumstances indicate the
carrying value may not be recoverable. If any such indication exists
and where the carrying value exceeds the discounted future cash flows
from these assets, the assets are written down to the fair value of the
estimated future cash flows based on OceanaGold's discount rate for the
asset.
Non-current assets are tested for impairment when events or changes in
circumstances suggest that the carrying amount may not be fully
recoverable. During the quarter, the Group identified two indicators of
potential impairment. Firstly, the trading price of the company's
shares declined such that the company's market capitalization was below
the carrying value of net assets. Secondly, market prices of gold
declined significantly to below levels used in the company's forecasts,
resulting in a decision to initiate a potential two year reduction in
the previously announced mine life at Reefton.
The Group has two cash generating units (CGUs), New Zealand and
Philippines. The Group has further analysed the indicators of
impairment and isolated the potential impairment to the New Zealand
CGU. As a result of these indicators, an impairment assessment on the
company's New Zealand CGU was performed.
The carrying value of the New Zealand CGU has been assessed using the
Fair Value Less Costs to Sell (FVLCS) approach, using discounted cash
flows and the Company determined that an impairment charge of $85.5
million was required, as the carrying value was greater than the FVLCS.
The FVLCS assessment was based on the following key assumptions:
-
Production profile and costs as per the Life of Mine Plan (LoMP) for the
current operating mines in New Zealand, and also including production
from certain identified exploration targets where there is a higher
degree of confidence in the economic extraction of minerals, although
these do not currently qualify for inclusion in proven or probable ore
reserves.
-
Revenue was projected using broker average forecast gold prices and
currently observable spot prices for by-products.
-
Pre-tax nominal discount rates of 8%-11% depending on the risk profile
of the different projects within the CGU.
The inter-relationship of the above key assumptions upon which estimated
future cash flows are based is such that it is impracticable to
reasonably estimate the extent of possible effects of a change in the
key assumptions in isolation.
It is reasonably possible, on the basis of existing knowledge, that
should outcomes during the next financial year significantly differ
from the assumptions made with respect to current and future projects,
it could require a material adjustment to the carrying value of the New
Zealand CGU.
The Group has determined that there is no indicator of impairment for
the Philippines CGU on the basis that the Company's long term outlook
for gold and copper prices has not changed which are the prices used
for the calculation of reserves. The Group believes that the current
decline in prices will not continue to be seen for a significant
proportion of the remaining 16 years expected life of the Didipio mine.
Derivative Financial Instruments/Hedge Accounting
The consolidated entity has used derivative financial instruments to
manage commodity price and foreign currency exposures from time to
time. Derivative financial instruments are initially recognised in the
balance sheet at fair value and are subsequently re- measured at their
fair values at each reporting date.
The fair value of gold hedging instruments is calculated by discounting
the future value of the hedge contract at the appropriate prevailing
quoted market rates at the reporting date. The fair value of forward
exchange contracts is calculated by reference to the current forward
exchange rate for contracts with similar maturity profiles.
Stock Option Pricing Model
Stock options granted to employees or external parties are measured by
reference to the fair value at grant date and are recognised as an
expense in equal instalments over the vesting period and credited to
the contributed surplus account. The expense is determined using an
option pricing model that takes into account the exercise price, the
term of the option, the impact of dilution, the non-tradable nature of
the option, the current price and expected volatility of the underlying
share, the expected dividend yield and the risk free interest rate for
the term of the option.
Income Tax
The Group follows the liability method of income tax allocation. Under
this method, future tax assets and liabilities are determined based on
differences between the financial reporting and tax bases of assets and
liabilities and are measured using the substantially enacted tax rates
and laws that will be in effect when the differences are expected to
reverse. Deferred tax assets including tax losses are recognised to the
extent that it is probable that the Company will generate sufficient
future taxable income. Utilisation of the tax losses also depends on
the ability of the entities to satisfy certain tests at the time the
losses are recouped.
Foreign Currency Translation
The consolidated financial statements are expressed in United States
dollars ("USD") and have been translated to USD using the current rate
method described below. The controlled entities of OceanaGold have
either Australian dollars ("AUD"), New Zealand dollars ("NZD") or
United States dollars ("USD") as their functional currency. Foreign
currency transactions are translated into the functional currency using
the exchange rates prevailing at the dates of the transactions.
Generally, foreign exchange gains and losses resulting from the
settlement of foreign currency transactions and from the translation at
year-end exchange rates of monetary assets and liabilities denominated
in currencies other than an operation's functional currency are
recognised in the statement of income.
Significant areas where management's judgment is applied include ore
reserve and resource determinations, exploration and evaluation assets,
mine development costs, plant and equipment lives, contingent
liabilities, current tax provisions and future tax balances and asset
retirement obligations. Actual results may differ from those
estimates.
Didipio commencement of Commercial Production
Management declared the Didipio commencement of Commercial Production to
be April 1, 2013. The criteria used to assess the start date were
determined based on the unique nature of the mine including its
complexity and location. Management considered various relevant
criteria to assess when the mine was substantially complete and ready
for its intended use and had moved into the production stage. The major
criteria that were considered included, but were not limited to, the
following: (1) all major capital expenditures to bring the mine to name
plate capacity had been completed; (2) at least 5,000 tonnes of
concentrate had been produced that met specifications; (3) the process
plant, power plant and other facilities had been transferred to the
control of the Operations team from the Commissioning team; (4) the
mine or mill had reached 80% percentage of design capacity ; (5) gold
and copper recoveries were at or near expected levels; (6) the open pit
mine had the ability to sustain ongoing production ore at the required
cut-off grade; and (7) costs were under control or within expectations.
RISKS AND UNCERTAINTIES
This document contains some forward looking statements that involve
risks, uncertainties and other factors that could cause actual results,
performance, prospects and opportunities to differ materially from
those expressed or implied by those forward looking statements. Factors
that could cause actual results or events to differ materially from
current expectations include, among other things: volatility and
sensitivity to market prices for gold; replacement of reserves;
possible variations of ore grade or recovery rates; changes in project
parameters; procurement of required capital equipment and operating
parts and supplies; equipment failures; unexpected geological
conditions; political risks arising from operating in certain
developing countries; inability to enforce legal rights; defects in
title; imprecision in reserve estimates; success of future exploration
and development initiatives; operating performance of current
operations; ability to secure long term financing and capital, water
management, environmental and safety risks; seismic activity, weather
and other natural phenomena; failure to obtain necessary permits and
approvals from government authorities; changes in government
regulations and policies including tax and trade laws and policies;
ability to maintain and further improve labour relations; general
business, economic, competitive, political and social uncertainties and
other development and operating risks.
For further detail and discussion of risks and uncertainties refer to
the Annual Information Form available on the Company's website.
CHANGES IN ACCOUNTING POLICIES INCLUDING INITIAL ADOPTION
Adoption of new accounting policies
The accounting policies adopted during the quarter are consistent with
those of the previous financial year and corresponding interim
reporting period
Accounting policies effective for future periods
The following accounting policies are effective for future periods:
IFRS 9 - Financial instruments
This standard will replace IAS 39, Financial Instruments: Recognition
and Measurement. IFRS 9 has two classification categories: amortized
cost and fair value.
Classification of debt assets will be driven by the entity's business
model for managing the financial assets and the contractual cash flow
characteristics of the financial assets. A 'simple' debt instrument is
measured at amortised cost if: a) the objective of the business model
is to hold the financial asset for the collection of the contractual
cash flows, and b) the contractual cash flows under the instrument
solely represent payments of principal and interest.
All other financial assets, including investments in complex debt
instruments and equity investments must be measured at fair value.
All fair value movements on financial assets must be recognised in
profit or loss except for equity investments that are not held for
trading (short-term profit taking), which may be recorded in other
comprehensive income (FVOCI). However, in December 2012, the IASB
proposed limited amendments which would introduce a FVOCI category for
certain eligible debt instruments.
For financial liabilities that are measured under the fair value option,
entities will need to recognise the part of the fair value change that
is due to changes in the entity's own credit risk in other
comprehensive income rather than profit or loss.
New hedging rules will also be included in the standard. These will make
testing for hedge effectiveness easier which means that more hedges are
likely to be eligible for hedge accounting. The new rules will also
allow more items to be hedged and relax the rules on using purchased
options and non-derivative financial instruments as hedging
instruments.
This standard is effective for years beginning on/after January 1,
2015. The Group has not assessed the impact of this new standard.
IAS 39 - Financial instruments
Amended to provide relief from discontinuing hedge accounting when
novation of a hedging instrument to a central counterparty ("CCP")
meets specified criteria.
This amendment is effective for years beginning on/after January 1,
2014. Since the group has not novated any hedging contracts in the
current or prior periods, applying the amendments will not affect any
of the amounts recognised in the financial statements.
IAS 36 - Impairment of assets
The AASB has made small changes to some of the disclosures that are
required under AASB 136 Impairment of Assets.
This amendments is effective for years beginning on/after January 1,
2014. These may result in additional disclosures if the group
recognises an impairment loss or the reversal of an impairment loss
during the period. They will not affect any of the amounts recognised
in the financial statements. The group intends to apply the amendment
from 1 January 2014.
IFRIC 21 - Levies
The standard sets out the accounting for an obligation to pay a levy
imposed by a government in accordance with legislation. It clarifies
that a liability must be recognised when the obligating event occurs,
being the event that triggers the obligation to pay the levy.
This standard is effective for years beginning on/after January 1, 2014.
The Group has not assessed the impact of this new standard.
SUMMARY OF QUARTERLY RESULTS OF OPERATIONS
The following table sets forth unaudited information for each of the
eight quarters ended September 30, 2011 through to June 30, 2013. This
information has been derived from our unaudited consolidated financial
statements which, in the opinion of management, have been prepared on a
basis consistent with the audited consolidated financial statements and
include all adjustments, consisting only of normal recurring
adjustments, necessary for fair presentation of our financial position
and results of operations for those periods. On adoption to IFRS there
were no material differences to the income statements and management
believes the results are comparable as they were prepared on a
consistent basis.
|
|
|
|
|
|
|
|
|
|
|
STATEMENT OF OPERATIONS
|
Jun 30
2013
$'000
|
Mar 31
2013
$'000
|
Dec 31
2012
$'000
|
Sep 30
2012
$'000
|
Jun 30
2012
$'000
|
Mar 31
2012
$'000
|
Dec 31
2011
$'000
|
Sep 30
2011
$'000
|
|
Sales Revenue
|
131,213
|
95,639
|
119,018
|
91,153
|
86,719
|
88,558
|
106,603
|
103,455
|
|
|
|
|
|
|
|
|
|
|
EBITDA (excluding
gain/(loss) on undesignated
hedges and impairment
charge)
|
42,495
|
47,076
|
67,100
|
28,614
|
25,632
|
23,285
|
43,622
|
43,270
|
|
|
|
|
|
|
|
|
|
|
Earnings/(loss) after income
tax and before gain/(loss) on
undesignated hedges (net of
tax and impairment charge)
|
(2,647)
|
6,490
|
23,120
|
328
|
735
|
(3,863)
|
14,336
|
10,912
|
|
|
|
|
|
|
|
|
|
|
|
Net Profit/(Loss)
|
(70,491)
|
7,059
|
24,197
|
(397)
|
735
|
(3,863)
|
14,336
|
10,912
|
|
|
|
|
|
|
|
|
|
|
|
Net earnings/(loss) per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$(0.24)
|
$0.02
|
$0.09
|
$(0.00)
|
$0.00
|
$(0.01)
|
$0.05
|
$0.04
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
$(0.24)
|
$0.02
|
$0.09
|
$(0.00)
|
$0.00
|
$(0.01)
|
$0.05
|
$0.04
|
|
|
|
|
|
|
|
|
|
|
The most significant factors causing variation in the results are the
volatility of the gold price; the variability in the grade of ore mined
from the Macraes and Reefton Open Pit mines;the timing of waste
stripping activities; movements in inventories and large movements in
foreign exchange rates between the USD and the NZD.
NON-GAAP MEASURES
Throughout this document, we have provided measures prepared according
to IFRS ("GAAP"), as well as some non-GAAP performance measures. As
non-GAAP performance measures do not have a standardised meaning
prescribed by GAAP, they are unlikely to be comparable to similar
measures presented by other companies.
We provide these non-GAAP measures as they are used by some investors to
evaluate OceanaGold's performance. Accordingly, such non-GAAP measures
are intended to provide additional information and should not be
considered in isolation, or a substitute for measures of performance in
accordance with GAAP. Earnings before interest, tax, depreciation and
amortisation (EBITDA) is one such non-GAAP measure and a reconciliation
of this measure to net Profit /(Loss) is provided on page 25.
Cash costs per ounce are other such non-GAAP measures and a
reconciliation of these measures to cost of sales, is provided on the
next page.
|
|
|
|
|
|
|
|
STATEMENT OF OPERATIONS
|
Q2
Jun 30 2013
$'000
|
Q1
Mar 31 2013
$'000
|
Q2
Jun 30 2012
$'000
|
Half Year
Jun 30 2013
$'000
|
Half Year
Jun 30 2012
$'000
|
Cost of sales, excluding
depreciation and amortisation
|
80,437
|
39,875
|
57,523
|
120,312
|
118,211
|
|
|
|
|
|
|
|
General & Administration &
Selling costs
|
3,786
|
365
|
116
|
4,151
|
230
|
|
|
|
|
|
|
|
Corporate Administrative
Adjustment
|
-
|
-
|
(2,324)
|
-
|
(4,701)
|
|
|
|
|
|
|
|
|
Copper By-product credits
|
(35,988)
|
-
|
-
|
(35,988)
|
-
|
|
|
|
|
|
|
|
Total Cash Costs (Net of copper
by-product credits)
|
48,235
|
40,240
|
55,315
|
88,475
|
113,740
|
|
|
|
|
|
|
|
Gold Sales from operating mines
(ounces)
|
70,706
|
58,585
|
53,756
|
129,291
|
105,608
|
|
|
|
|
|
|
|
|
Cash Operating Costs ($/ounce)
|
682
|
687
|
1,029
|
684
|
1,077
|
|
|
|
|
|
|
|
ADDITIONAL INFORMATION
Additional information referring to the Company, including the Company's
Annual Information Form, is available on SEDAR at www.sedar.com and the Company's website at www.oceanagold.com.
DISCLOSURE CONTROLS AND PROCEDURES
The Chief Executive Officer and Chief Financial Officer evaluated the
effectiveness of the Company's disclosure controls and procedures as at
June 30, 2013. Based on that evaluation, the Chief Executive Officer
and the Chief Financial Officer concluded that the design and operation
of these disclosure controls and procedures were effective as at June
30, 2013 to provide reasonable assurance that material information
relating to the Company, including its consolidated subsidiaries, would
be made known to them by others within those entities.
INTERNAL CONTROL OVER FINANCIAL REPORTING
Management of OceanaGold, including the Chief Executive Officer and
Chief Financial Officer, have evaluated the effectiveness of the design
and operation of the Company's of the internal controls over financial
reporting and disclosure controls and procedures as of June 30, 2013.
Based on this evaluation, the Chief Executive Officer and Chief
Financial Officer have concluded that they were effective at a
reasonable assurance level.
There were no significant changes in the Company's internal controls, or
in other factors that could significantly affect those controls
subsequent to the date the Chief Executive Officer and Chief Financial
Officer completed their evaluation, nor were there any significant
deficiencies or material weaknesses in the Company's internal controls
requiring corrective actions.
The Company's management, including the Chief Executive Officer and the
Chief Financial Officer, does not expect that its disclosure controls
and internal controls over financial reporting will prevent all errors
and fraud. A cost effective system of internal controls, no matter how
well conceived or operated, can provide only reasonable not absolute,
assurance that the objectives of the internal controls over financial
reporting are achieved.
NOT FOR DISSEMINATION OR DISTRIBUTION IN THE UNITED STATES OR TO US
PERSONS AND NOT FOR DISTRIBUTION TO US NEWSWIRE SERVICE
SOURCE: OceanaGold Corporation
