Apollo Gold Reports Fourth Quarter and Year End 2006 Results



    DENVER, April 2 /CNW/ - Apollo Gold Corporation ("Apollo" or the
"Company") (AMEX:  AGT) (TSX:APG) reports the results for the three months and
year ended December 31, 2006 (in US dollars, unless otherwise indicated) as
follows.

    Results for the Fourth Quarter 2006 Compared to Fourth Quarter 2005

    Apollo's revenues from continuing operations for the fourth quarter of
2006 were nil as compared to $7.3 million for the fourth quarter 2005. This
decrease is due to the cessation of milling operations on May 12, 2006 at
Montana Tunnels. Apollo incurred a net loss of $3.4 million for the fourth
quarter of 2006 as compared to a net loss of $4.2 million, or $0.04 per share,
for the fourth quarter 2005.

    Results for 2006 Fiscal Year Compared to 2005 Fiscal Year

    Apollo's revenues from continuing operations for the year ended December
31, 2006 decreased 76% to $10.2 million, compared to $43.3 million for the
year ended December 31, 2005. This decrease is due to the cessation of milling
operations on May 12, 2006 at Montana Tunnels. Apollo incurred a net loss of
$15.6 million, or $0.13 per share, for the year ended December 31, 2006, as
compared to a net loss of $22.2 million, or $0.22 per share, for the year
ended December 31, 2005.

    2006 Highlights

    Montana Tunnels Mine

    --  At the Montana Tunnels mine (the "Mine"), open pit mining activity
was suspended on October 21, 2005 for safety reasons due to increased wall
activity on the eastern side of the open pit. Following the suspension of
mining, the mill continued to process ore from stockpiled material and produce
gold dore and lead-gold and zinc-gold concentrates until May 12, 2006 when all
operations ceased and the property was placed on care and maintenance. For the
year ended December 31, 2006, a total of 4,959 ounces of gold, 116,004 ounces
of silver, 1,196,317 lbs of lead and 3,040,058 lbs of zinc were produced.

    --  On July 28, 2006, we entered into a joint venture agreement (the "JV
Agreement")with Elkhorn Tunnels, LLC ("Elkhorn") in respect of the Mine,
pursuant to which Elkhorn was granted a 50% interest in the Mine in exchange
for financial contributions. We are the operator of the Mine.

    --  Following the signing of the JV Agreement, the Mine commenced an open
pit wall remediation program in August 2006, which called for removal of
approximately 7 million tons of waste over a six month period and encompassed
the laying back of the east and south east sectors of the pit wall and
rebuilding the access ramp. As at December 31, 2006, we had excavated
approximately 5.8 million tons of remediation waste and were working on the
ramp system below switchback # 4 which is 100 feet above the open pit bottom
and the ore body. Upon reaching the open pit bottom in January 2007, waste
material removal commenced to expose the ore body. Mill personnel were hired
in late 2006 and early 2007 to begin maintenance work in preparation for the
mill start up, which occurred on March 1, 2007 and shipments of lead-gold and
zinc-gold concentrates commenced during the second week of March 2007.

    Black Fox Development Property

    --  In August 2006 we reported reserves and resources under a Canadian
National Instrument NI 43-101 report. The reserves and resources were based
upon the 2003 to 2006 exploration program and included a pre-feasibility study
of developing an open pit mine on the Black Fox property. This study did not
consider any underground material. We report no reserves at Black Fox under
U.S. Securities and Exchange Commission Industry Guide 7, which requires a
final bankable feasibility study. The table below summarizes the Black Fox
Total Mineral Resource:

    
                                                    Tonnes Grade
                                                    000's  G Au/t  Ounces
                                                    ------ ------ --------
    Open Pit - Material
      Reserve                                       3,062   4.56  448,800
      Indicated Resource(1)                         2,356   3.27
      Inferred Resource(1)                          6,626   4.00
    Underground - Material
      Indicated Resource(1)                         1,004   9.66
      Inferred Resource(1)                          1,228   9.71

    (1) US investors, see the notes at the bottom of this press release
     labeled "Cautionary Note to US Investors concerning estimates of
     Indicated Mineral Resources" and "Cautionary Note to US Investors
     concerning estimates of Inferred Mineral Resources."
    

    --  Black Fox Open Pit Economics - Using only the open pit reserves of
448,000 ounces, at a gold price of $550 per ounce, an on site mill processing
facility with a capacity of 1,500 tonnes per day and tailings facility has a
positive net present value of $36 million at a 5% discount rate and an
internal rate of return of 21.63%.

    Huizopa Exploration Project

    --  Apollo entered into an agreement with the Ejido Huizopa which gives
the Company a right to use Ejido land covering the 12,800 hectares of the
Company's mining concessions in Huizopa for all activities necessary for the
exploration, development and production of potential ore deposits.

    --  A geophysical program was implemented during the year and several
prospective drilling sites were identified for the 2007 drilling program.

    
    Consolidated Financial Results Summary

    (All Dollars in US, 000's unless otherwise stated)

                                    Three months ended     Year ended
                                       December 31,       December 31,
                                     2006(1)   2005      2006      2005
                                    --------------------------------------
    Loss from continuing operations  ($3,347) ($3,955) ($15,237) ($15,961)
    Loss from discontinued
     operations                        ($100)   ($293)    ($350)  ($6,247)
                                    --------------------------------------
    Net loss for the period          ($3,447) ($4,248) ($12,587) ($22,208)

    Basic and diluted net loss per
     share from (US$):
       Continuing operations          ($0.03)  ($0.04)   ($0.13)   ($0.16)
       Discontinued operations        ($0.00)  ($0.00)   ($0.00)   ($0.06)
                                    --------------------------------------
                                      ($0.03)  ($0.04)   ($0.13)   ($0.22)

    Gold ounces sold (continuing
     operations)                           -    5,026     4,959    44,099
    Total cash costs per ounce
     (US$/oz) (1) (2)                      -     $762      $718      $563

    (1) Total cash costs per ounce for the year ended December 31, 2006
         are through May 2006. The Montana Tunnels mine ceased milling
         operations on May 12, 2006; therefore, no metal products were
         produced after that date.
    (2) The term "total cash cost" is a non-GAAP financial measure and is
         used on a per ounce of gold sold basis. Total cash cost is
         equivalent to direct operating cost as found on the Consolidated
         Statements of Operations and includes by-product credits for
         payable silver, lead, and zinc production. We have included total
         cash cost information to provide investors with information about
         the cost structure of our mining operation. This information
         differs from measures of performance determined in accordance
         with GAAP in Canada and in the United States and should not be
         considered in isolation or as a substitute for measures of
         performance prepared in accordance with GAAP. This measure is not
         necessarily indicative of operating profit or cash flow from
         operations as determined under GAAP and may not be comparable to
         similarly titled measures of other companies.
    

    
    Summary Operational Statistics
                                             Year Ended December 31,
                                        ----------------------------------
                                         2006 (1)     2005        2004
                                        ---------- ----------- -----------
    Production Summary
       Gold ounces                          4,959      44,099      33,743
       Silver ounces                      116,004     524,722     970,751
       Lead pounds                      1,196,317  10,428,061  10,064,265
       Zinc pounds                      3,040,058  22,380,136  26,222,805
    Cash Cost Per Ounce
       Cash Operating Cost/oz                $643        $529        $798
       Total Cash Cost/oz                    $718        $563        $839
       Total Production Cost/oz              $794        $618        $913

       Gold Reserves (ounces) (2)         724,650     993,000   1,100,900

    (1) Costs per ounce are through May 2006. The Montana Tunnels mine
         ceased milling operations on May 12, 2006; therefore, no metal
         products were produced after that date.
    (2) The Company had a decrease in gold reserve ounces of 275,580
         ounces in 2006 as a result of contributing the Montana Tunnels
         mine into the joint venture with Elkhorn Tunnels, LLC.
    

    Financial Condition and Liquidity

    At December 31, 2006, we had cash and cash equivalents of $4.5 million,
compared to $0.1 million at December 31, 2005. The increase in cash from
December 31, 2005 is primarily the result of (i) contributions of $9.3 million
from Elkhorn, our joint venture partner at the Montana Tunnels mine, (ii) the
release of $11.0 million in January 2006 from the restricted cash account held
at December 31, 2005, as collateral security for our 12% Series-B Secured
Convertible Debentures and (iii) net proceeds of $8.8 million from the
issuance and sale of common shares and warrants, offset by operating cash out
flows of $11.6 million from operating activities, primarily from the Montana
Tunnels operation. At March 1, 2007, we had cash and short-term investments of
$8.7 million, which includes net proceeds of $7.9 million from our private
placement of convertible debentures and warrants in February 2007, less the
payment of $2.6 related to our Huizopa project in February 2007.

    In 2006, cash provided by investing activities totaled $3.7 million. Cash
supplied from restricted cash was $9.0 million, consisting of the $11.0
million released from restricted cash in January 2006 as cash collateral
security for the $8.8 million 12% Series-B Secured Convertible Debentures,
partially offset by $2.0 million additional restricted cash for the Montana
Tunnels reclamation liability. Capital expenditures were $5.4 million, of
which $5.3 million were for the further development of the Black Fox project.

    During the year ended December 31, 2006, financing activities provided
$8.8 million in cash, from (a) completing in January 2006, the sale to
Jipangu, Inc. of equity units at Cdn$0.35 per unit, consisting of 11,650,000
common shares and 2,000,000 warrants exercisable at Cdn$0.39 for net proceeds
of $3.5 million, (b) completing in October 2006, an offering of flow-through
equity units of the Company at Cdn$0.45 per unit, consisting of 2,222,221
flow-through shares and 1,111,111 warrants exercisable at amounts from
Cdn$1.00 to Cdn$1.15 for net proceeds of $0.8 million, and (c) completing in
November 2006, an offering for equity units at $0.30 per unit, consisting of
16,688,206 common shares and 8,344,103 warrants exercisable at $0.50 for net
proceeds of $4.5 million. During 2006, $1.4 million was paid on equipment
leases.

    We estimate that with our year end cash balance of $4.5 million, as
supplemented by the monies raised in our private placement of convertible
debentures and warrants in February 2007 and our share of the projected cash
flow from the joint ventured Montana Tunnels mine, we will have sufficient
funds to finance the current work programs of $4.5 million at Black Fox and
$2.5 million for exploration at Huizopa, as well as corporate overhead.
However, we will continue to explore financing opportunities to further
develop the Black Fox project and expand our exploration program at the
Huizopa project, which may include Canadian flow-through financing for use at
the Black Fox project. The availability, amount, terms and timing of this
financing are not certain at this time.

    Our ability to raise capital is highly dependent upon the commercial
viability of our projects and the associated prices of the metals we produce.
Because of the significant impact that changes in the prices of gold and zinc
have on our financial condition, declines in these metals prices may
negatively impact short-term liquidity and our ability to raise additional
funding for long-term projects. In the event that cash balances decline to a
level that cannot support our operations, our management will defer certain
planned capital expenditures and exploration activities as needed to conserve
cash for operations. There can be no assurance that we will be successful in
generating adequate funding for planned capital expenditures, environmental
remediation and reclamation expenditures and for exploration expenditures.

    2007 Outlook

    Montana Tunnels mine - The mine is a 50/50 joint venture with Elkhorn.
During 2007 the mine is expected to mine 7,200,000 tons waste material and
5,800,000 tons of ore for a total of 13,000,000 tons mined giving a stripping
ratio of 1.24:1. With the resumption of the milling of ore on March 1, 2007,
the mine is expected to mill 4,500,000 tons of ore and to produce the
following payable metals during 2007: 40,000 ozs of gold, 250,000 ozs of
silver, 11,500,000 lbs of lead and 25,000,000 lbs of zinc. Apollo's share of
this production is: 20,000 ozs of gold, 125,000 ozs of silver, 5,750,000 lbs
of lead and 12,500,000 lbs of zinc. We expect our share of capital
expenditures to be approximately $0.7 million.

    Black Fox project - We anticipate that our third party consultant, SRK
Consulting, Inc., will complete an NI 43-101 compliant underground reserve in
the second quarter 2007, which should be followed up six months later by a
feasibility study based on a combined open pit and underground mining
operation along with an on site mill. Permitting of the operation is ongoing
and should be completed late 2007 or early 2008.

    In 2007, we plan to undertake two drilling programs at Black Fox: (a)
deep hole core drilling and (b) shallow hole core drilling. The goals of the
two programs are to (i) expand the mineralization along strike and down dip of
the present resources along the Destor-Porcupine Fault and (ii) expand the
base metal/gold discovery in the footwall to see if the two systems intersect
at depth. This drilling campaign will be financed from flow-through funding.
Capital expenditures to cover the above are forecast to be approximately $4.5
million.

    Huizopa project - During 2007 our focus at Huizopa will be to advance the
exploration phase of the project, specifically, construction of a dirt road to
give easier access for a drilling campaign. The drilling will be a reverse
circulation drilling program of approximately 25 holes and a core drill
program of approximately 25 holes lasting from September to November (after
the road is completed). The cost of the project is expected to be
approximately $2.5 million for the year 2007.

    Apollo Gold Corporation

    Apollo is a gold mining and exploration company with a mine as described
above as the Montana Tunnels mine, the Black Fox advanced stage development
project in Ontario, Canada, and the Huizopa project, an early stage
exploration project in the Sierra Madres in Chihuahua, Mexico.

    (1) Cautionary Note to US Investors concerning estimates of Indicated
Mineral Resources. This press release uses the term "indicated mineral
resources". We advise US investors that while the term is recognized and
required by Canadian regulations, the US Securities and Exchange Commission
does not recognize it. US investors are cautioned not to assume that any part
or all of the mineral deposits in these categories will ever be converted into
mineral reserves.

    (2) Cautionary Note to US Investors concerning estimates of Inferred
Mineral Resources. This press release uses the term "inferred mineral
resources". We advise US investors that while the term is recognized and
required by Canadian regulations, the US Securities and Exchange Commission
does not recognize it. "Inferred mineral resources" have a great amount of
uncertainty as to their existence, and great uncertainty as to their economic
and legal feasibility. It cannot be assumed that all or any part of an
inferred mineral resource will ever be upgraded to a higher category. In
accordance with Canadian rules, estimates of inferred mineral resources cannot
form the basis of feasibility or other economic studies. US investors are
cautioned not to assume that part or all of the inferred mineral resource
exists, or is economically or legally minable.

    FORWARD-LOOKING STATEMENTS

    This press release includes "Forward-Looking Statements" within the
meaning of section 21E of the United States Securities Exchange Act of 1934,
as amended. Forward-looking statements can be identified by the use of words
such as "may," "should," "expects," "plans," "anticipates," "believes,"
"estimates," "schedules," "predicts," "intends," "continue," or the negative
of such terms, or other comparable terminology. All statements regarding the
future operation of the Montana Tunnels mill, future cash flow from the
Montana Tunnels mine, production at the Montana Tunnels mine, the future level
of ore stockpiles at the Montana Tunnels mine, planned remediation activities,
statements respecting reserves with respect or relating to the Montana Tunnels
mine, the timing of completion of NI 43-101 compliant underground reserve and
feasibility studies in respect of our Black Fox project, permitting and
drilling at our Black Fox project, construction and drilling at our Huizopa
project and future capital expenditures at our Black Fox and Huizopa projects
are forward-looking statements that involve various risks and uncertainties.
There can be no assurance that such statements will prove to be accurate and
actual results and future events could differ materially from those
anticipated in such statements. Important factors that could cause actual
results to differ materially from these forward-looking statements include:
additional operational, geotechnical, processing and remediation problems at
the Montana Tunnels mine, unexpected changes in business and economic
conditions, political or economic instability, significant decreases in gold,
zinc or lead prices, results of additional drilling at Black Fox, results of
drilling and other exploration activities at Huizopa, difficulties or delays
in permitting at Black Fox, changes in interest and currency rates, local and
community impacts and issues, labor accidents, environmental risks and other
factors disclosed under the heading "Risk Factors" in Apollo's most recent
annual report on Form 10-K filed with the United States Securities and
Exchange Commission and elsewhere in Apollo's documents filed from time to
time with the Toronto Stock Exchange, The American Stock Exchange, The United
States Securities and Exchange Commission and other regulatory authorities.
All forward-looking statements included in this press release are based on
information available to Apollo on the date hereof. Apollo assumes no
obligation to update any forward-looking statements.

    
                           APOLLO GOLD CORPORATION
                         CONSOLIDATED BALANCE SHEETS

                                                         December 31,
                                                     ---------------------
                                                       2006       2005
                                                     ---------- ----------
                         ASSETS                        (In thousands of
    CURRENT                                              U.S. Dollars)
     Cash and cash equivalents                       $   4,512  $     127
     Accounts receivable and other                         728      2,638
     Note receivable                                     1,865          -
     Prepaids                                              301        400
     Inventories                                           660      1,708
                                                     ---------- ----------
     Total current assets                                8,066      4,873
    Property, plant and equipment                       38,868     40,045
    Restricted certificates of deposit                   4,605     17,043
    Deferred financing costs                               265        584
                                                     ---------- ----------
    TOTAL ASSETS                                     $  51,804  $  62,545
                                                     ---------- ----------
                      LIABILITIES
    CURRENT
     Accounts payable                                $   1,710  $   6,802
     Accrued liabilities                                 1,254      1,841
     Notes payable                                         671        596
     Property and mining taxes payable                     442      1,172
     Convertible debenture                               7,660          -
                                                     ---------- ----------
     Total current liabilities                          11,737     10,411
    Accrued severance                                      370        383
    Notes payable                                          569         75
    Convertible debenture                                    -      6,601
    Accrued site closure costs                           7,135     12,634
    Deferred gain                                        3,750          -
                                                     ---------- ----------
    TOTAL LIABILITIES                                   23,561     30,104
                                                     ---------- ----------


                  SHAREHOLDERS' EQUITY
    Share capital                                      159,029    148,526
    Equity component of convertible debentures           1,809      1,809
    Note warrants                                        1,062        781
    Contributed surplus                                 11,166     10,561
    Deficit                                           (144,823)  (129,236)
                                                     ---------- ----------
    TOTAL SHAREHOLDERS' EQUITY                          28,243     32,441
                                                     ---------- ----------
    TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY       $  51,804  $  62,545
                                                     ---------- ----------
    

    
                           APOLLO GOLD CORPORATION
                    CONSOLIDATED STATEMENTS OF OPERATIONS

                                          Year Ended December 31,
                                  ----------------------------------------
                                      2006          2005         2004
                                  ------------- ------------- ------------
                                   (In thousands of U.S. dollars, except
                                      for share and per share amounts)
    REVENUE
      Revenue from sale of
       minerals                   $     10,177  $     43,254  $    38,254
                                  ------------- ------------- ------------
    OPERATING EXPENSES
      Direct operating costs            15,361        48,357       52,473
      Depreciation and
       amortization                      1,647         2,551        2,640
      General and administrative
       expenses                          3,577         7,588        7,095
      Stock-based compensation             427           597          767
      Accretion expense - accrued
       site closures costs                 948           881          820
      Loss (gain) on sale of
       property, plant and
       equipment                             7        (3,848)          (6)
      Exploration and business
       development                       1,033           918        1,051
                                  ------------- ------------- ------------
                                        23,000        57,044       64,840
                                  ------------- ------------- ------------
    OPERATING LOSS                     (12,823)      (13,790)     (26,586)
    OTHER INCOME (EXPENSES)
      Interest income                      421           397          313
      Interest expense                  (2,677)       (2,533)        (252)
      Foreign exchange loss and
       other                              (158)          (35)        (770)
                                  ------------- ------------- ------------
    LOSS FROM CONTINUING
     OPERATIONS FOR THE YEAR           (15,237)      (15,961)     (27,295)
    LOSS FROM DISCONTINUED
     OPERATIONS FOR THE YEAR              (350)       (6,247)      (3,712)
                                  ------------- ------------- ------------
    NET LOSS FOR THE YEAR         $    (15,587) $    (22,208) $   (31,007)
                                  ------------- ------------- ------------

    BASIC AND DILUTED NET LOSS
     PER SHARE FROM:
      Continuing operations       $      (0.13) $      (0.16) $     (0.34)
      Discontinued operations            (0.00)        (0.06)       (0.05)
                                  ------------- ------------- ------------
                                  $      (0.13) $      (0.22) $     (0.39)
                                  ------------- ------------- ------------
    BASIC AND DILUTED WEIGHTED-
     AVERAGE NUMBER OF SHARES
     OUTSTANDING                   123,621,267   101,811,291   78,716,042
                                  ------------- ------------- ------------
    

    
                           APOLLO GOLD CORPORATION
                    CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                Year Ended December 31,
                                             -----------------------------
                                               2006      2005      2004
                                             --------- --------- ---------
                                                (In thousands of U.S.
                                                        dollars)
    OPERATING ACTIVITIES
     Net loss for the year                   $(15,587) $(22,208) $(31,007)
     Items not affecting cash:
      Depreciation and amortization             1,647     2,551     2,640
      Amortization of deferred financing
       costs                                      319       319        53
      Loss from discontinued operations           350     6,247     3,712
      Reduction in exercise price of Note
       Warrants                                   305         -         -
      Stock-based compensation                    427       597       767
      Shares issued for services                  668         -         -
      Accretion expense - accrued site
       closure costs                              948       881       820
      Accretion expense - convertible
       debenture, net of interest paid          1,059     1,085       (92)
      Foreign exchange loss and other              81       372         6
      Loss (gain) on sale of property, plant
       and equipment                                7    (3,848)       (6)
      Bridge loan compensation warrants             -         -       275
     Net change in non-cash operating
      working capital items                    (1,482)    1,845     3,423
     Discontinued operations                     (350)      848    (1,299)
                                             --------- --------- ---------
    Net cash used in operating activities     (11,608)  (11,311)  (20,708)
                                             --------- --------- ---------
    INVESTING ACTIVITIES
     Property, plant and equipment
      expenditures                             (5,417)   (5,487)  (13,018)
     Short-term investments                         -         -     5,855
     Proceeds from disposal of property,
      plant and equipment                          92     4,526         -
     Restricted certificate of deposit and
      other assets                              9,007   (12,671)   (1,286)
     Proceeds from disposition of
      discontinued operations                       -    14,000         -
     Discontinued operations                        -     1,022    (9,587)
                                             --------- --------- ---------
    Net cash provided by (used in) investing
     activities                                 3,682     1,390   (18,036)
                                             --------- --------- ---------
    FINANCING ACTIVITIES
     Proceeds on issuance of shares and
      warrants                                  8,773     5,944     7,509
     Proceeds from exercise of warrants and
      options                                     260         -     8,931
     Proceeds from bridge loan                      -         -     3,000
     Repayment of bridge loan                       -         -    (3,000)
     Acquisition and cancellation of shares         -         -       (48)
     Proceeds on issuance of convertible
      debentures, net                               -         -     7,525
     Payments of notes payable                 (1,357)     (752)   (1,478)
     Contributions by Elkhorn                   4,635         -         -
     Discontinued operations                        -    (2,030)   (2,641)
                                             --------- --------- ---------
    Net cash provided by financing
     activities                                12,311     3,162    19,798
                                             --------- --------- ---------
    NET INCREASE (DECREASE) IN CASH             4,385    (6,759)  (18,946)
    CASH AND CASH EQUIVALENTS, BEGINNING OF
     YEAR                                         127     6,886    25,832
                                             --------- --------- ---------
    CASH AND CASH EQUIVALENTS, END OF YEAR   $  4,512  $    127  $  6,886
                                             --------- --------- ---------
    SUPPLEMENTAL CASH FLOW INFORMATION
    Interest paid                            $  1,299  $  1,204  $    560
                                             --------- --------- ---------
    Income taxes paid                        $      -  $      -  $      -
                                             --------- --------- ---------
    




For further information:

For further information: Apollo Gold Corporation Marlene Matsuoka,
720-886-9656 Ext. 217 (IR) info@apollogold.com Toll Free: 1-877-465-3484
www.apollogold.com

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APOLLO GOLD CORPORATION

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