ANVIL MINING LIMITEDDetailed Chart...Anvil Mining Reports Third Quarter 2009 Results
TSX, ASX: AVM
Common shares outstanding 117.5 million
All amounts are expressed in US dollars, unless otherwise stated.
As at The Company's 2009 third quarter results represent a significant improvement on the results of the first and second quarters of 2009, primarily as a result of the performance of the Kinsevere Heavy Media Separation ("HMS") plant and the reduced impact of one-off factors associated with the cessation of operations at the Company's Dikulushi, Mutoshi and Kinsevere mines during the fourth quarter of 2008, which had a significant negative impact on the Company's first and second quarter results.
The Company recommenced operation of the Kinsevere HMS plant on
Since recommencement of operations, the HMS plant has produced 11,436 tonnes of copper contained in concentrate and generated gross revenue of
The complete third quarter 2009 unaudited financial statements together with the related Management's Discussion and Analysis (MD&A) are available on Anvil's website at www.anvilmining.com under the heading "Financial Reports" within the Investor Relations section.
Key points for the third quarter
- Sales of $18.1 million.
- Operating profit of $4.2 million.
- Net loss of $0.2 million ($0.00 per share).
- Positive cash flows from operating activities, before working capital
movements, of $6.6 million ($0.06 per share).
- Net unrealized gain related to mark-to-market movement in the value of
available-for-sale investments of $3.7 million which has been
recognised in shareholders' equity.
- Quarterly production of 5,865 tonnes of copper.
- Positive cash flow from Kinsevere HMS operating activities of
$9.1 million (excluding payments for staff redundancies and other
one-off costs).
- Completion of the first tranche of the private placement with Trafigura
Beheer B.V. ("Trafigura") for proceeds of approximately $32 million.
- Appointment of Mr. Jeremy Weir to the Company's board of directors.
Key points for the year to date
- Positive cash flow from operating activities, since recommencement of
the Kinsevere HMS plant of $9.7 million (excluding payments for staff
redundancies and other one-off costs).
- Net loss of $30.4 million (-$0.34 per share).
- Negative cash flows from operating activities, before working capital
movements, of $11.7 million (-$0.13 per share).
- Copper production of 11,436 tonnes.
Near term objectives (next three months)
- Continued positive cash flow from operation of the Kinsevere HMS plant.
- Shareholder approval of the transaction with Trafigura.
- Completion of the remaining engineering and design works for Kinsevere
Stage II.
- Continued build up of early works program at Kinsevere Stage II.
- Execution of Lump Sum Turnkey ("LSTK") contract with Ausenco.
- Appointment of owner's representative for Kinsevere Stage II
construction works.
Longer term objectives (2010 onwards)
- Completion of construction and commissioning of the Kinsevere
Stage II SX-EW plant.
- Commencement of further drilling on the Mutoshi project and the
Kinsevere sulphide resource.
- Completion of a pre-feasibility study for a Mutoshi Stage II SX-EW
project.
- Completion of preliminary studies on the mining and processing of the
sulphide resource at Kinsevere.
Kinsevere HMS Production
The Company recommenced operation of the Kinsevere HMS plant on
For the September quarter, the HMS plant produced 21,901 tonnes of concentrate, grading 26.8% copper for 5,865 tonnes of copper and since recommencement of operation in late In addition to producing a coarse concentrate from the HMS plant, the Company also produces a fine grained, slightly lower grade concentrate from a spirals circuit, through which the fines ((less than)0.6mm) which are screened off before the HMS circuit, are treated. Table 1 below sets out the details of the performance of the HMS plant for the third quarter and year to date 2009.
Table 1. Performance of Kinsevere HMS Plant
-------------------------------------------------------------------------
Third March 27,
Quarter ended 2009 to
September 30, September 30,
2009 2009
-------------------------------------------------------------------------
Ore mined (tonnes) 132,493 132,493
-------------------------------------------------------------------------
Ore processed - HMS (tonnes) 80,730 166,510
-------------------------------------------------------------------------
Feed grade - HMS (% Cu) 8.0 8.0
-------------------------------------------------------------------------
Contained copper - HMS (tonnes) 6,443 13,320
-------------------------------------------------------------------------
Copper recovery - HMS (%) 80.6 75.9
-------------------------------------------------------------------------
Copper produced in concentrate -
HMS (tonnes) 5,192 10,045
-------------------------------------------------------------------------
Copper produced in concentrate -
Spirals (tonnes) 673 1,391
-------------------------------------------------------------------------
Concentrate grade - HMS and Spirals (% Cu) 26.8 26.3
-------------------------------------------------------------------------
Total copper produced in concentrate - HMS
& Spirals (tonnes) 5,865 11,436
-------------------------------------------------------------------------
Operating cash cost - ex mine gate ($ per
tonne of concentrate) 249 300
-------------------------------------------------------------------------
Kinsevere Stage II
Having received proceeds during the third quarter of approximately
- Engineering and Design - work is progressing well, with approximately
56% of the works completed as at October 31, with the remaining works
expected to be completed in early December 2009.
- Contract documentation - a term sheet that sets out the major
commercial terms of a LSTK contract has been agreed with Ausenco and
negotiations to finalise the LSTK contract are continuing.
- Early Works Program - the Company has begun an Early Works Program, the
key elements of which include: refurbishment of the Stage II camp and
supporting infrastructure; procurement of long lead time items; and
commencement by Ausenco of negotiations with sub-contractors.
- Ausenco Project Risk Review - a risk review was carried out during
September 2009 at which representatives from Ausenco, the Company,
Trafigura and Green Team International ("GTI") participated.
- Peer Review - the Company engaged GTI to conduct a Peer Review focusing
on the project schedule, manpower requirements, cost estimates and the
contractor's capabilities, which is expected to be finalized during the
fourth quarter of 2009.
- Appointment of an Owner's Representative - discussions are well
advanced in relation to the appointment of an Owner's Representative
and the Company expects to be in position to make such an appointment
immediately following the execution of the LSTK contract after the
meeting of shareholders to approve the transaction with Trafigura.
The Company estimates that the timeframe for completion of construction, dry commissioning, and hydraulic testing for readiness to receive ore is approximately 12-15 months from award of contract. Third Quarter Results Conference Call and Webcast
The Company will hold a conference call at The details to access the conference call and the live audio webcast are as follows: Conference call: 1-416-646-3097 (Please call approximately five minutes prior to the scheduled start of the call). Live audio webcast of the conference call (listen mode only):
- CNW Group website at:
http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID=2862860 (English)
http://www.cnw.ca/fr/webcast/viewEvent.cgi?eventID=2862860 (French)
Replay Information (available for a period of 7 days): The conference call will be recorded and a playback of the call will be available after the event by dialling 1-416-640-1917, Reservation number 4178908 followed by the pound # key.
Anvil Mining Limited is a copper producer whose shares are listed for trading on the Caution Regarding Forward Looking Statements: This news release contains "forward-looking statements" and "forward-looking information", based on assumptions and judgements of management regarding future events and results. Such "forward-looking statements" and "forward-looking information which may include, but is not limited to the operation of the Kinsevere HMS plant, the liquidation of the Company's available-for-sale investments and the Company's plans for expansions of the Kinsevere copper mine. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects", "is expected", "is expecting", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes", or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might", or "will" be taken, occur or be achieved. The purpose of forward-looking information is to provide the reader with information about management's expectations and plans for 2009. Readers are cautioned that forward-looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Anvil and/or its subsidiaries to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors include, among others, the actual market prices of the available-for-sale investments, the actual market price of copper, changes in project parameters as plans continue to be evaluated, and the possibility of cost overruns, as well as those factors disclosed in the Company's filed documents. There can be no assurance that the Stage II expansion of the Kinsevere copper mine will proceed as planned or that the transactions proposed with Trafigura will be successfully completed within expected time limits and budgets or that, when completed, the expanded production facility will operate as anticipated.
Appendix
Key Financial and Production Data (unaudited)
-------------------------------------------------------------------------
3 months ended 9 months ended
September 30 September 30
2009 2008 2009 2008
-------------------------------------------------------------------------
Sales: ($ millions) Copper-
silver and copper concentrate
sales 18.1 42.3 27.5 177.4
-------------------------------------------------------------------------
Operating profit / (loss):
($ millions) 4.2 (2.6) (17.9) 47.1
-------------------------------------------------------------------------
Provision for impairment:
($ millions) (2.4) (5.5) (7.3) (5.5)
Exploration expenditure written
off: ($ millions) - (2.5) (3.2) (2.5)
-------------------------------------------------------------------------
Net (loss)/ Income:
($ millions) (0.2) (17.3) (30.4) 12.6
-------------------------------------------------------------------------
PRODUCTION STATISTICS:
Consolidated Group
Copper produced in
concentrates (tonnes) 5,865 11,318 11,436 33,866
Silver produced in
concentrates (ounces) - 189,867 - 921,339
Per Mine
Kinsevere mine
Ore mined (tonnes) 132,493 727,736 132,493 2,248,467
Ore processed (tonnes) 80,730 104,414 166,510 290,808
Copper grade (% Cu) 8.0 9.1 8.0 9.4
Contained copper in ore
(tonnes) 6,443 9,467 13,320 27,290
Recovery Cu (%) 80.6 75.1 75.9 67.4
Copper produced in
concentrates - HMS (tonnes) 5,192 7,113 10,045 18,401
Copper produced in concentrate
- Spirals (tonnes) 673 - 1,391 -
Copper produced in concentrate
- HMS and Spirals (tonnes) 5,865 7,113 11,436 18,401
Copper produced in blister
(tonnes) - 161 - 161
-------------------------------------------------------------------------
Costs of production ($)
Operating cash costs per
tonne of concentrate
(ex mine gate) $/t 249 194 300 270
-------------------------------------------------------------------------
Dikulushi mine
Ore mined (tonnes) - 15,265 - 81,288
Ore processed (tonnes) - 134,994 - 345,517
Feed grade (% Cu) - 2.2 - 3.4
Contained Copper in Ore
(tonnes) - 2,934 - 11,637
Recovery Cu (%) - 61.8 - 80.0
Copper produced in
concentrates (tonnes) - 1,813 - 9,304
Silver produced in concentrates
(ounces) - 189,867 - 921,339
Operating cash cost (ex mine
gate) (after silver credits)
($/lb) - 2.89 - 0.59
-------------------------------------------------------------------------
Total cash costs from operations
($/lb) - 3.47 - 1.10
-------------------------------------------------------------------------
Mutoshi mine
Ore mined (tonnes) - 154,602 - 428,361
Ore processed (tonnes) - 135,772 - 373,199
Copper grade (% Cu) - 3.8 - 3.9
Contained copper in ore (tonnes) - 5,152 - 14,624
Recovery Cu (%) - 46.4 - 41.1
Copper produced in concentrates
(tonnes) - 2,392 - 6,160
-------------------------------------------------------------------------
Costs of production: ($)
Operating cash costs per tonne
of concentrate (ex mine gate) - 984 - 914
-------------------------------------------------------------------------
Consolidated Balance Sheets (unaudited)
(Expressed in thousands of United States dollars)
September 30 December 31
2009 2008
$ $
ASSETS
Current assets
Cash and cash equivalents 69,008 45,033
Restricted cash 1,009 871
Accounts receivable 13,314 24,243
Inventories 17,744 31,064
Available-for-sale investments 14,967 24,032
Prepaid expenses and deposits 33,577 51,258
--------------------------------
149,619 176,501
Equity accounted investment - 1,320
Long-term inventory 10,875 10,651
Long-term receivable 15,256 12,464
Exploration and acquisition expenditure 50,319 51,352
Property, plant and equipment 333,126 280,334
--------------------------------
559,195 532,622
--------------------------------
--------------------------------
LIABILITIES
Current liabilities
Accounts payable and accrued liabilities 24,428 34,731
Income taxes payable - 463
Other liabilities 1,449 2,460
Current portion of long-term debt 282 362
--------------------------------
26,159 38,016
Future income tax liability 18,968 24,431
Other non-current liability 6,589 -
Long-term debt 149 321
Asset retirement obligations 13,626 12,980
--------------------------------
65,491 75,748
Non-controlling interest 761 1,909
--------------------------------
66,252 77,657
--------------------------------
Shareholders' equity
Equity accounts 444,742 383,419
Retained earnings 40,572 70,987
Accumulated other comprehensive income 7,629 559
--------------------------------
Total shareholders' equity 492,943 454,965
--------------------------------
559,195 532,622
--------------------------------
--------------------------------
Consolidated Statements of Income and Comprehensive Income
(unaudited)
(Expressed in thousands of United States dollars
except per share amounts)
---------------------------------------------
3 Months Ended 9 Months Ended
September 30 September 30
2009 2008 2009 2008
---------------------------------------------
$ $ $ $
Sales 18,089 42,320 27,473 177,376
Operating expenses (10,114) (37,371) (33,939) (99,357)
Amortization (3,776) (7,579) (11,473) (30,969)
---------------------------------------------
4,199 (2,630) (17,939) 47,050
---------------------------------------------
Other income 447 1,581 893 6,828
Share of loss in associates - (555) - (891)
Provision for impairment
of assets (2,381) (5,517) (7,316) (5,517)
Exploration expenditure
written off - (2,500) (3,224) (2,500)
General, administrative and
marketing (1,504) (5,721) (7,346) (18,134)
Foreign exchange
(losses) / gains (856) (481) 691 (99)
Stock based compensation (339) (784) (1,444) (1,784)
Interest and financing fees (244) (215) (762) (1,072)
---------------------------------------------
(Loss) / Earnings before
income tax and
non-controlling interest (678) (16,822) (36,447) 23,881
Income tax credit /
(expense) 611 (969) 5,845 (10,278)
Non-controlling interest
share of (gain) / loss (166) 455 187 (984)
---------------------------------------------
Net (loss) / income (233) (17,336) (30,415) 12,619
Other comprehensive income
Net unrealized gain on
available-for-sale
investments 3,703 (6,069) 7,070 (5,727)
---------------------------------------------
Total comprehensive
income / (loss) 3,470 (23,405) (23,345) 6,892
---------------------------------------------
---------------------------------------------
Basic (loss) / earnings
per share ($) 0.00 (0.24) (0.34) 0.18
Diluted (loss) / earnings
per share ($) 0.00 (0.24) (0.34) 0.18
Consolidated Statement of Cash Flows (unaudited)
(Expressed in thousands of United States dollars)
---------------------------------------------
3 Months Ended 9 Months Ended
September 30 September 30
2009 2008 2009 2008
---------------------------------------------
$ $ $ $
Cash flows from operating
activities
Net (loss) / earnings for
the period (233) (17,336) (30,415) 12,619
Items not affecting cash
Amortization 3,776 7,579 11,473 30,969
Share of loss in associates - 555 - 891
(Gain) / Loss on sale of
assets (195) 20 (156) 277
Exploration expenditure
written off - 2,500 3,224 2,500
Provision for impairment
of assets 2,381 5,517 7,316 5,517
Accretion expense 216 189 646 1,079
Non-controlling interest
share of (loss) / income 167 (455) (187) 984
Unrealized foreign exchange
losses / (gains) 314 (1,492) 376 (942)
Future tax (199) 1,126 (5,464) 4,189
Stock based compensation 338 784 1,444 1,784
Changes in non-cash working
capital (4,710) 30,137 7,096 12,915
---------------------------------------------
1,855 29,124 (4,647) 72,782
---------------------------------------------
Cash flows from investing
activities
Payments for property, plant
and equipment (13,522) (41,376) (40,819) (137,464)
Proceeds from sale of assets 824 225 1,176 465
Payments for exploration and
evaluation expenditure (1,083) (8,587) (2,191) (23,946)
Proceeds of principal
repayments from investments 1,103 5,605 12,631 12,910
Payments for build up of
low-grade ore stockpiles - (3,164) - (9,304)
---------------------------------------------
(12,678) (47,297) (29,203) (157,339)
---------------------------------------------
Cash flows from financing
activities
Proceeds from issue of shares
(net of issue expenses) 31,960 193 59,159 711
Proceeds from borrowings
(net of fees incurred) - - - 800
Repayment of borrowings (252) (79) (252) (117)
Movement in restricted cash (44) - (137) (1,193)
Disbursements on behalf of
Dikulushi Trusts (523) (2,448) (960) (5,547)
---------------------------------------------
31,141 (2,334) 57,810 (5,346)
---------------------------------------------
Net increase / (decrease)
in cash and cash
equivalents 20,318 (20,507) 23,960 (89,903)
Cash and cash equivalents
at beginning of the period 48,677 146,186 45,033 215,754
Effects of exchange rate
changes on cash held in
foreign currencies 13 (194) 15 (366)
---------------------------------------------
Cash and cash equivalents at
end of the period 69,008 125,485 69,008 125,485
---------------------------------------------
%SEDAR: 00020549E For further information: Craig Munro, Senior Vice President Corporate & CFO, +61 (8) 9481 4700, craigm@anvilmining.com (Perth); Robert La Vallière, Vice President Corporate Affairs, (Office) (514) 448 6664, (Cell) (514) 944 9036, robertl@anvilmining.com (Montréal); www.anvilmining.com
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