TORONTO, April 15 /CNW/ - Anaconda Mining Inc. ("Anaconda") - (TSX: ANX); is pleased to report its results for the nine months ended February 28, 2010. All amounts are in Canadian dollars unless stated otherwise. The financial results and Management's Discussion and Analysis of these results may be found on Anaconda's website (www.anacondamining.com) and on its SEDAR profile (www.sedar.com).
- As at February 28, 2010, Anaconda had total assets of $20.0 million
including cash and cash equivalents of $2.0 million, of which
$910,710 is restricted as a result of letters-of-credit guarantees
with a Canadian financial institution, amounts held in a debt-
reduction escrow account to be utilized for debt service and/or
principal repayments to Anaconda's series I debenture holders and
amounts held in Chile at the Anaconda's subsidiary.
- During the third quarter ended February 28, 2010, Anaconda produced
2,274 ounces of gold at an average cost of $1,255 per ounce. The
average price of gold sales was $1,180 (US$1,120) per ounce. The Pine
Cove mill contributed 613 ounces of the total with the remaining gold
(1,661 ounces) coming from Anaconda's now-terminated toll-milling
arrangement at Nugget Pond.
- Consolidated net loss for the third quarter ended February 28, 2010
was $2.2 million ($0.025 per basic and fully-diluted share). Revenues
included $2.7 million of precious metals sales offset by $2.8 million
for costs of goods sold, administrative expenses of $937,000, write-
down of mineral properties and deferred exploration expenditures of
$725,000 and depletion and amortization of $413,000. Foreign exchange
gains and future income tax recoveries reduced the loss by $52,000.
- Consolidated net loss for the nine months ended February 28, 2010 was
$1.6 million ($0.019 per basic and fully-diluted share). Revenues
included $10.3 million of precious metals sales offset by $8.2
million for costs of goods sold, administrative expenses of $2.4
million, write-down of mineral properties and deferred exploration
expenditures of $725,000 and depletion and amortization of $554,000.
Foreign exchange losses and future income taxes of $28,000 increased
the loss further.
- The increase in cash during the nine months ended February 28, 2010
of $863,463 was comprised of cash used in operating activities of
$497,000, cash provided from financing activities of $3,457,000,
offset by cash used in investing activities of $2,113,000. The effect
on exchange rates on foreign currency held by Anaconda increase cash
balances by $16,000.
- As at February 28, 2010, Anaconda had a working capital deficiency of
$2.2 million. Anaconda utilized the proceeds from the private
placements completed during the first and third fiscal quarters of
this year, to fund operations and to discharge some of its current
operating obligations as well as providing funding for its capital
requirements for the mill expansion project at Pine Cove.
Pine Cove Expansion
- Anaconda's expansion of its mill at Pine Cove is progressing along
its forecasted timeline. The commissioning of the expanded mill
remains on schedule for June 2010.
- The civil/structural work is complete regarding the annex to the mill
building required to house the primary ball mill. Anaconda completed
the foundation walls and upper slab, as well as placement of the mill
and erection of the building.
- All engineered piping, instrumentation, vacuum system, and tailings
and reclaim water pumps and lines have been ordered.
- Anaconda completed electrical calculations regarding its recently
acquired mill motor and the associated capacitor bank and
transformers that were required to meet the requirements of
Newfoundland Hydro and to work with the local power grid. The
calculations have been submitted to Newfoundland Hydro and have been
approved. Electrical engineering and design has been finalized for
all major electrical components including the mill motor start-up
capacitor bank, and associated transformers and switch gear.
- All electrical equipment has been ordered and electrical installation
contractors are being interviewed for award in April.
- Overall engineering is 70% complete with a final completion goal of
- Engineering for the flotation (scavenger circuit) is complete and
bids are being reviewed for fabrication, which will commence in
- The contact cell platform arrived and was erected. The contact cells
(rougher flotation) were set as well as the sumps and pumps. Piping
of the rougher flotation circuit has begun.
DISPUTE WITH NEW ISLAND RESOURCES
Anaconda has received a dispute notice from its Pine Cove joint venture partner, New Island Resources Inc. ("New Island") under the terms of the Option and Joint Venture Agreement dated November 26, 2003 and the Custom Milling Agreement (the "Agreement") dated May 29, 2009. New Island has challenged Anaconda's interpretation and distribution of net profits as defined under the Agreement and has made a claim against Anaconda of $590,749 in respect thereof. Anaconda disputes New Island's interpretation and denies any liability. The matter will be resolved by arbitration in accordance with the Agreement.
Anaconda is a Toronto, Canada based mining and exploration company focused on advancing its principal assets, the Pine Cove gold mine in Newfoundland and the San Gabriel Iron Project in Chile. Anaconda is committed to bringing Pine Cove into full Commercial Production, as well as developing near-term production opportunities for San Gabriel.
Certain statements contained herein constitute "forward-looking statements". These forward- looking statements are based on current expectations. The nature, timing and extent of mining and processing of Pine Cove ore under the Crew Gold toll processing arrangement may materially change from current intentions for a number of reasons. Additionally, forward-looking statements look into the future and provide an opinion as to the effect of certain events and trends on the business. Forward-looking statements may include words such as "plans," "may," "estimates," "expects," "indicates," "targeting," "potential" and similar expressions. These forward-looking statements, including statements regarding Anaconda's beliefs in the potential mineralization, are based on current expectations and entail various risks and uncertainties. Actual results may materially differ from expectations as more information regarding the property is gathered or if known and unknown risks or uncertainties affect Anaconda's business, or if Anaconda's estimates or assumptions prove inaccurate. Anaconda assumes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or any other reason.
For further information: For further information: Anaconda Mining Inc., Lew Lawrick, President and CEO, (416) 864-3357, Email: firstname.lastname@example.org or Anaconda Mining Inc., Greg DiTomaso, Investor Relations, (647) 436-2592, Email: email@example.com, Company website: www.anacondamining.com