This is information that SEMAFO Inc. is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out below, at 9 p.m. Eastern time on May 12, 2020.
MONTREAL, May 12, 2020 /CNW Telbec/ - SEMAFO Inc. (TSX: SMF) (OMX: SMF) is pleased to announce results of operations for the three-month period ended March 31, 2020. All amounts are in US dollars unless otherwise stated.
Highlights
The following 2020 highlights include a 4-week suspension of operations at the Boungou Mine.
- Signing of definitive agreement with Endeavour
- Consolidated gold production of 81,900 ounces
- Gold sales of $123.2 million
- All-in sustaining cost1 of $888 per ounce sold
- Operating income of $33.2 million
- Net income attributable to shareholders of the Corporation of $14.1 million or $0.04 per share
- Adjusted net income attributable to shareholders of the Corporation1 of $20.8 million or $0.06 per share1
- Cash flow from operating activities before changes in non-cash working capital1 of $60.0 million or $0.18 per share1
- Full production rate of 2,000 tpd reached at Siou underground (UG)
- SEMAFO provides Endeavour transaction update, including update on timing, mailing of meeting materials for May 28 Special Meeting and Board resolutions passed to apply for delisting from the TSX and Nasdaq Stockholm pending closing of transaction
Benoit Desormeaux, President and Chief Executive Officer of SEMAFO, stated: "Despite a four-week shutdown at Boungou and the implementation of preventive measures against the COVID-19 virus, we delivered a solid first quarter that included a smooth ramp-up of Siou underground to full production. During the quarter, we announced a strategic transaction with Endeavour that continues to receive strong stakeholder support. We remind our shareholders to vote in favour of the transaction at the special shareholder meeting that will be held virtually on May 28. Details on how to attend and vote are provided in the joint circular that has been mailed to shareholders, filed on SEDAR and is available on our website."
|
_____________________________
|
|
1
|
All-in sustaining cost, adjusted net income attributable to shareholders of the Corporation and per share, cash flow from operating activities before changes in non-cash working capital and per share are non-IFRS financial performance measures with no standard definition under IFRS. See the "Non-IFRS Financial Performance Measures" section of the 2020 First Quarter MD&A, note 18.
|
|
Consolidated Results and Mining Operations
|
|
|
|
Three-month period
|
|
|
ended March 31,
|
|
|
2020
|
|
2019
|
|
Variation
|
|
Gold ounces produced
|
|
81,900
|
|
102,400
|
|
(20%)
|
|
Gold ounces sold
|
|
76,800
|
|
106,100
|
|
(28%)
|
|
|
|
|
|
|
|
|
(in thousands of dollars, except amounts per ounce and per share)
|
|
|
|
|
|
|
|
Revenues – Gold sales
|
|
123,211
|
|
138,541
|
|
(11%)
|
|
Operating income
|
|
33,217
|
|
40,359
|
|
(18%)
|
|
|
|
|
|
|
|
|
Net income attributable to shareholders of the Corporation
|
|
14,066
|
|
17,666
|
|
(20%)
|
|
Basic earnings per share
|
|
0.04
|
|
0.05
|
|
(20%)
|
|
Diluted earnings per share
|
|
0.04
|
|
0.05
|
|
(20%)
|
|
|
|
|
|
|
|
|
Adjusted net income attributable to shareholders of the Corporation1
|
|
20,793
|
|
22,632
|
|
(8%)
|
|
Per share1
|
|
0.06
|
|
0.07
|
|
(14%)
|
|
|
|
|
|
|
|
|
Cash flow from operating activities before changes in non-cash working capital1
|
|
59,985
|
|
78,980
|
|
(24%)
|
|
Per share1
|
|
0.18
|
|
0.24
|
|
(25%)
|
|
|
|
|
|
|
|
|
Average realized selling price (per ounce)
|
|
1,604
|
|
1,306
|
|
23%
|
|
Total cash cost (per ounce sold)1
|
|
661
|
|
484
|
|
37%
|
|
All-in sustaining cost (per ounce sold)1
|
|
888
|
|
745
|
|
19%
|
Consolidated Operational Overview
Financial results for Boungou and Mana are provided at the end of this press release. In early February 2020, the Boungou plant restarted and processing of the stockpile began.
The year-over-year decrease in gold sales and gold ounces produced and sold is mainly due to the four-week suspension of operations at the Boungou Mine, which was partially offset by the increase in the average realized selling gold price.
The decrease in cash flow from operating activities before changes in non-cash working capital1 in the first quarter of 2020 compared to the same period in 2019 mainly reflects the four-week suspension of operations at the Boungou Mine.
|
___________________________________________
|
|
1
|
Adjusted net income attributable to shareholders of the Corporation, adjusted basic earnings per share, cash flow from operating activities before changes in non-cash working capital and per share, total cash cost and all-in sustaining cost are non-IFRS financial performance measures with no standard definition under IFRS. See the "Non-IFRS Financial Performance Measures" section of the 2020 First Quarter MD&A, note 18.
|
Update on COVID-19
Over the past months, SEMAFO has implemented a series of protocols to help prevent the spread of the COVID-19 virus among its employees, contractors, suppliers and surrounding communities. At the site-level, these involve sensitising employees, mandatory quarantine for expatriates entering Burkina Faso, temperature screening of new arrivals at travel and site access points, cancelling non-essential travel, increasing sanitation measures and heightening its medical response capacity. Personnel with elevated temperatures or other symptoms are immediately placed in preventive isolation, together with co-workers with whom they may have been in contact.
In parallel, the Corporation instigated early preventive measures to mitigate impact on the supply chain. These include increasing stock levels from suppliers from certain regions and stock levels of key supplies in addition to alternate sourcing of key spare parts and reagents.
Endeavour Transaction Update
As previously announced by the Corporation, in connection with the transaction with Endeavour, a Special Meeting of SEMAFO's shareholders will be held virtually through live audio webcast on Thursday, May 28, 2020 at 09:30 EST. The purpose of the Special Meeting is to seek approval for the acquisition by Endeavour of all the issued and outstanding securities of SEMAFO by way of a Plan of Arrangement under the Business Corporations Act (Québec). Shareholders who wish to attend the virtual Special Meeting must follow the procedures set out in the joint circular which has already been mailed and is available on SEDAR and our website at www.semafo.com.
In addition, SEMAFO was advised today by Endeavour that it has received a notice from the Director of Investments under the Investment Canada Act (the "ICA") pursuant to section 25.2(1) of the ICA indicating that the Minister of Innovation, Science and Economic Development is considering whether to order a national security review of the Transaction under section 25.3(1) of the ICA. Endeavour has advised SEMAFO that it will work with the Director to address any outstanding questions or concerns, although neither Endeavour nor SEMAFO is aware of any reasons for the notice. In particular, while SEMAFO's head office is located in Quebec, it has no operating assets in Canada and its operations are confined to gold production and exploration in Burkina Faso. The Minister has until June 25, 2020 to consider whether to order a review under section 25.3(1) of the ICA. If the Minister issues a notice indicating that no such order for a national security review will be made, and assuming all of the conditions to the Transaction are satisfied or waived, the closing of the Transaction is expected to occur before the end of June 2020.
Finally, in response to the COVID-19 pandemic, the Corporation intends to rely on the exemption provided by AMF Decision No. 2020-PDG-0034 (the "Blanket Relief Order") from the requirement to file its executive compensation disclosure within 140 days following the end of its most recently completed financial year. The Corporation will file its executive compensation disclosure in due course in accordance with the requirements set forth in the Blanket Relief Order, and will hold its annual general meeting of shareholders at the appropriate time.
Delisting from Nasdaq Stockholm
In conjunction with the anticipated closing of the Endeavour transaction, SEMAFO has resolved to apply for delisting of the SEMAFO shares from Nasdaq Stockholm, subject to the satisfaction or waiver of the conditions to the transaction. The last day of trading of the SEMAFO shares on Nasdaq Stockholm will be announced as soon as SEMAFO has been informed thereof by Nasdaq Stockholm.
About SEMAFO
SEMAFO is a Canadian-based intermediate gold producer with over twenty years' experience building and operating mines in West Africa. The Corporation operates two mines, the Boungou and Mana Mines in Burkina Faso. SEMAFO is committed to building value through responsible mining of its quality assets and leveraging its development pipeline.
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements. All statements other than statements of present or historical facts are forward-looking. Forward-looking statements involve known and unknown risks, uncertainties and assumptions and accordingly, actual results and future events could differ materially from those expressed or implied in such statements. You are hence cautioned not to place undue reliance on forward-looking statements. Forward-looking statements include words or expressions such as "expected", "pending", "continues", "will", "seek", "committed", "building", "leveraging", "pipeline" and other similar words or expressions. Factors that could cause future results or events to differ materially from current expectations expressed or implied by the forward-looking statements include: the ability to complete the transaction with Endeavour Mining Corporation on the terms and timing proposed; the impact on the closing and timing of the proposed transaction with Endeavour Mining Corporation as a result of any review ordered by the Minister of Innovation, Science and Development pursuant to the ICA; the ability to prevent and manage the COVID-19 virus, the ability to execute on our strategic focus; fluctuation in the price of currencies; gold or operating costs; mining industry risks; uncertainty as to calculation of mineral reserves and resources; delays, political and social stability in Africa (including our ability to maintain or renew licenses and permits); the security of our operations; and other risks described in SEMAFO's documents filed with Canadian securities regulatory authorities. You can find further information with respect to these and other risks in SEMAFO's 2019 Annual MD&A as updated in the 2020 First Quarter MD&A and other filings made with Canadian securities regulatory authorities, including the joint circular relating to the Endeavour transaction, which are available on SEDAR at www.sedar.com or the SEMAFO website at www.semafo.com. SEMAFO disclaims any obligation to update or revise these forward-looking statements, except as required by applicable law.
|
Interim Consolidated Statements of Financial Position
|
|
(Expressed in thousands of US dollars - unaudited)
|
|
|
|
|
|
|
|
|
As at
|
|
|
As at
|
|
|
March 31,
|
|
|
December 31,
|
|
|
2020
|
|
|
2019
|
|
|
$
|
|
|
$
|
|
|
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
96,681
|
|
|
98,297
|
|
Trade and other receivables
|
|
39,684
|
|
|
44,645
|
|
Income tax receivable
|
|
1,545
|
|
|
4,434
|
|
Inventories
|
|
99,900
|
|
|
98,072
|
|
Other current assets
|
|
5,073
|
|
|
5,380
|
|
|
242,883
|
|
|
250,828
|
|
Non-current assets
|
|
|
|
|
|
|
Advance receivable
|
|
1,227
|
|
|
1,421
|
|
Restricted cash
|
|
9,736
|
|
|
9,964
|
|
Property, plant and equipment
|
|
828,114
|
|
|
843,123
|
|
Intangible asset
|
|
1,034
|
|
|
1,079
|
|
Other non-current financial assets
|
|
1,532
|
|
|
3,698
|
|
|
841,643
|
|
|
859,285
|
|
Total assets
|
|
1,084,526
|
|
|
1,110,113
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
Trade payables and accrued liabilities
|
|
51,720
|
|
|
67,819
|
|
Debt
|
|
29,565
|
|
|
59,275
|
|
Current portion of lease liabilities
|
|
12,125
|
|
|
13,073
|
|
Current portion of share unit plan liabilities
|
|
4,036
|
|
|
3,269
|
|
Provisions
|
|
2,788
|
|
|
2,843
|
|
|
100,234
|
|
|
146,279
|
|
Non-current liabilities
|
|
|
|
|
|
|
Lease liabilities
|
|
14,276
|
|
|
15,244
|
|
Share unit plan liabilities
|
|
1,882
|
|
|
2,755
|
|
Provisions
|
|
26,111
|
|
|
25,617
|
|
Deferred income tax liabilities
|
|
79,786
|
|
|
72,478
|
|
|
122,055
|
|
|
116,094
|
|
Total liabilities
|
|
222,289
|
|
|
262,373
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders of the Corporation
|
|
|
|
|
|
|
Share capital
|
|
647,251
|
|
|
647,251
|
|
Contributed surplus
|
|
6,105
|
|
|
6,105
|
|
Accumulated other comprehensive loss
|
|
(19,517)
|
|
|
(17,351)
|
|
Retained earnings
|
|
176,193
|
|
|
162,127
|
|
|
810,032
|
|
|
798,132
|
|
Non-controlling interests
|
|
52,205
|
|
|
49,608
|
|
|
|
|
|
|
|
Total equity
|
|
862,237
|
|
|
847,740
|
|
Total liabilities and equity
|
|
1,084,526
|
|
|
1,110,113
|
|
Interim Consolidated Statements of Income
|
|
For the three-month ending March 31, 2020 and 2019
|
|
(Expressed in thousands of US dollars, except per share amounts - unaudited)
|
|
|
|
Three-month period
|
|
ended March 31,
|
|
2020
|
2019
|
|
$
|
$
|
|
Revenue – Gold sales
|
123,211
|
138,541
|
|
|
|
|
Costs of operations
|
|
|
|
Mining operation expenses
|
52,165
|
51,405
|
|
Depreciation of property, plant and equipment
|
31,532
|
39,628
|
|
General and administrative
|
4,461
|
3,960
|
|
Corporate social responsibility expenses
|
262
|
357
|
|
Share-based compensation
|
1,574
|
2,832
|
|
|
|
|
Operating income
|
33,217
|
40,359
|
|
|
|
|
Other expenses (income)
|
|
|
|
Finance income
|
(452)
|
(548)
|
|
Finance costs
|
2,796
|
3,556
|
|
Foreign exchange loss
|
588
|
496
|
|
Transaction costs
|
1,578
|
—
|
|
|
|
|
Income before income taxes
|
28,707
|
36,855
|
|
|
|
|
Income tax expense
|
|
|
|
Current
|
3,341
|
734
|
|
Deferred
|
8,703
|
14,999
|
|
12,044
|
15,733
|
|
|
|
|
Net income for the period
|
16,663
|
21,122
|
|
|
|
|
Attributable to:
|
|
|
|
Shareholders of the Corporation
|
14,066
|
17,666
|
|
Non-controlling interests
|
2,597
|
3,456
|
|
16,663
|
21,122
|
|
|
|
|
Earnings per share
|
|
|
|
Basic
|
0.04
|
0.05
|
|
Diluted
|
0.04
|
0.05
|
|
Interim Consolidated Statements of Cash Flows
|
|
For the three-month period ended March 31, 2020 and 2019
|
|
(Expressed in thousands of US dollars - unaudited)
|
|
|
Three-month period
|
|
ended March 31,
|
|
2020
|
2019
|
|
$
|
$
|
|
Cash flows from (used in):
|
|
|
|
|
|
|
Operating activities
|
|
|
|
Net income for the period
|
16,663
|
21,122
|
|
Adjustments for:
|
|
|
|
Depreciation of property, plant and equipment
|
31,532
|
39,628
|
|
Share-based compensation
|
1,574
|
2,832
|
|
Amortization of deferred financing costs
|
290
|
—
|
|
Unrealized foreign exchange loss
|
839
|
116
|
|
Deferred income tax expense
|
8,703
|
14,999
|
|
Other
|
384
|
283
|
|
Cash flow from operating activities before changes in non-cash working capital
|
59,985
|
78,980
|
|
Changes in non-cash working capital items
|
874
|
(15,736)
|
|
Net cash provided by operating activities
|
60,859
|
63,244
|
|
|
|
|
Financing activities
|
|
|
|
Repayment of debt
|
(30,000)
|
(15,000)
|
|
Repayment of equipment financing
|
—
|
(77)
|
|
Payments of lease liabilities
|
(3,532)
|
(2,125)
|
|
Proceeds on issuance of share capital, net of expenses
|
—
|
430
|
|
Net cash used in financing activities
|
(33,532)
|
(16,772)
|
|
|
|
|
Investing activities
|
|
|
|
Acquisition of property, plant and equipment
|
(26,810)
|
(43,179)
|
|
Net cash used in investing activities
|
(26,810)
|
(43,179)
|
|
|
|
|
Effect of exchange rate changes on cash and cash equivalents
|
(2,133)
|
(827)
|
|
Change in cash and cash equivalents during the period
|
(1,616)
|
2,466
|
|
Cash and cash equivalents – Beginning of period
|
98,297
|
96,519
|
|
Cash and cash equivalents – End of period
|
96,681
|
98,985
|
|
Interest paid
|
1,500
|
2,775
|
|
Interest received
|
452
|
548
|
|
Income tax paid
|
275
|
851
|
|
Boungou, Burkina Faso
|
|
Mining Operations
|
|
|
|
|
Three-month period
|
|
|
|
ended March 31,
|
|
|
|
2020
|
2019
|
Variation
|
|
Operating Data
|
|
|
|
|
|
|
Mining
|
|
|
|
|
|
|
Waste mined (tonnes)
|
|
|
—
|
2,106,000
|
(100%)
|
|
Ore tonnes mined
|
|
|
—
|
280,000
|
(100%)
|
|
Operational stripping ratio
|
|
|
—
|
7.5
|
(100%)
|
|
Capitalized Stripping Activity
|
|
|
|
|
|
|
Waste material – Boungou (tonnes)
|
|
|
—
|
5,044,600
|
(100%)
|
|
Total strip ratio
|
|
|
—
|
25.5
|
(100%)
|
|
|
|
|
|
|
|
Processing
|
|
|
|
|
|
|
Tonnes processed (tonnes)
|
|
|
199,800
|
308,700
|
(35%)
|
|
Head grade (g/t)
|
|
|
5.29
|
6.50
|
(19%)
|
|
Recovery (%)
|
|
|
94
|
96
|
(2%)
|
|
Gold ounces produced
|
|
|
32,000
|
61,900
|
(48%)
|
|
Gold ounces sold
|
|
|
25,000
|
64,700
|
(61%)
|
|
|
|
|
|
|
|
Financial Data (in thousands of dollars)
|
|
|
|
|
|
|
Revenues – Gold sales
|
|
|
40,793
|
84,492
|
(52%)
|
|
Mining operation expenses
|
|
|
12,247
|
17,070
|
(28%)
|
|
Government royalties and development taxes
|
|
|
2,385
|
4,724
|
(50%)
|
|
Depreciation of property, plant and equipment
|
|
|
10,624
|
24,948
|
(57%)
|
|
General and administrative
|
|
|
425
|
217
|
96%
|
|
Corporate social responsibility expenses
|
|
|
8
|
82
|
(90%)
|
|
Segment operating income
|
|
|
15,104
|
37,451
|
(60%)
|
|
|
|
|
|
|
|
Statistics (in dollars)
|
|
|
|
|
|
|
Average realized selling price (per ounce)
|
|
|
1,629
|
1,306
|
25%
|
|
Cash operating cost (per tonne processed)1
|
|
|
68
|
53
|
28%
|
|
Cash operating cost including stripping (per tonne processed)1
|
|
|
68
|
88
|
(23%)
|
|
Total cash cost (per ounce sold)1
|
|
|
530
|
337
|
57%
|
|
All-in sustaining cost (per ounce sold)1
|
|
|
550
|
534
|
3%
|
|
Depreciation (per ounce sold)2
|
|
|
425
|
386
|
10%
|
|
______________________________
|
|
1
|
Cash operating cost, cash operating cost including stripping, total cash cost and all-in sustaining cost are non-IFRS financial performance measures with no standard definition under IFRS. See the "Non-IFRS Financial Performance Measures" section of the 2020 First Quarter MD&A, note 18.
|
|
2
|
Depreciation per ounce sold is a non-IFRS financial performance measure with no standard definition under IFRS and represents the depreciation expense per ounce sold.
|
|
Mana, Burkina Faso
|
|
Mining Operations
|
|
|
|
|
|
|
|
Three-month period
|
|
|
|
ended March 31,
|
|
|
|
2020
|
2019
|
Variation
|
|
Operating Data
|
|
|
|
|
|
|
Mining - Open pit
|
|
|
|
|
|
|
Waste mined (tonnes)
|
|
|
1,771,500
|
2,766,300
|
(36%)
|
|
Ore tonnes mined
|
|
|
211,200
|
408,100
|
(48%)
|
|
Operational stripping ratio
|
|
|
8.4
|
6.8
|
24%
|
|
Capitalized Stripping Activity
|
|
|
|
|
|
|
Waste material – Siou (tonnes)
|
|
|
117,600
|
2,405,900
|
(95%)
|
|
Waste material – Wona (tonnes)
|
|
|
2,486,700
|
1,825,000
|
36%
|
|
|
|
2,604,300
|
4,230,900
|
(38%)
|
|
Total strip ratio
|
|
|
20.7
|
17.1
|
21%
|
|
Mining - Underground (UG)
|
|
|
|
|
|
|
Ore tonnes mined
|
|
|
163,560
|
—
|
—
|
|
|
|
|
|
|
|
Processing
|
|
|
|
|
|
|
Ore processed (tonnes)
|
|
|
407,000
|
427,900
|
(5%)
|
|
Low grade material (tonnes)
|
|
|
257,700
|
212,300
|
21%
|
|
Tonnes processed (tonnes)
|
|
|
664,700
|
640,200
|
4%
|
|
Head grade (g/t)
|
|
|
2.49
|
2.27
|
10%
|
|
Recovery (%)
|
|
|
94
|
87
|
8%
|
|
Gold ounces produced
|
|
|
49,900
|
40,500
|
23%
|
|
Gold ounces sold
|
|
|
51,800
|
41,400
|
25%
|
|
|
|
|
|
|
|
Financial Data (in thousands of dollars)
|
|
|
|
|
|
|
Revenues – Gold sales
|
|
|
82,418
|
54,049
|
52%
|
|
Mining operations expenses
|
|
|
33,414
|
27,182
|
23%
|
|
Government royalties
|
|
|
4,119
|
2,429
|
70%
|
|
Depreciation of property, plant and equipment
|
|
|
20,768
|
14,531
|
43%
|
|
General and administrative
|
|
|
588
|
543
|
8%
|
|
Corporate social responsibility expenses
|
|
|
254
|
275
|
(8%)
|
|
Segment operating income
|
|
|
23,275
|
9,089
|
156%
|
|
|
|
|
|
|
|
Statistics (in dollars)
|
|
|
|
|
|
|
Average realized selling price (per ounce)
|
|
|
1,592
|
1,306
|
22%
|
|
Cash operating cost (per tonne processed)¹
|
|
|
56
|
41
|
37%
|
|
Cash operating cost including stripping and UG development (per tonne processed)1
|
|
|
79
|
61
|
30%
|
|
Total cash cost (per ounce sold)¹
|
|
|
725
|
715
|
1%
|
|
All-in sustaining cost (per ounce sold)¹
|
|
|
1,052
|
1,075
|
(2%)
|
|
Depreciation (per ounce sold)²
|
|
|
401
|
351
|
14%
|
|
_____________________________
|
|
1
|
Cash operating cost, cash operating cost including stripping and UG development, total cash cost and all-in sustaining cost are non-IFRS financial performance measures with no standard definition under IFRS. See the "Non-IFRS Financial Performance Measures" section of the 2020 First Quarter MD&A, note 18.
|
|
2
|
Depreciation per ounce sold is a non-IFRS financial performance measure with no standard definition under IFRS and represents the depreciation expense per ounce sold.
|
SOURCE SEMAFO
View original content: http://www.newswire.ca/en/releases/archive/May2020/12/c9539.html
SEMAFO: John Jentz, Vice-President, Corporate Development & Investor Relations, Email: John.Jentz@semafo.com; Ruth Hanna, Analyst, Investor Relations, Email: Ruth.Hanna@semafo.com; Tel. local & overseas: +1 (514) 744 4408, North America Toll-Free: 1 (888) 744 4408, Website: http://www.semafo.comCopyright CNW Group 2020