EX-99.1 2 goro-20151103ex991d53549.htm EX-99.1 goro_Current Folio_EX_99-1

GRC-web-top-banner-5.16.13

 

 

 

 

FOR IMMEDIATE RELEASE

NEWS

November 3, 2015

NYSE MKT: GORO

 

GOLD RESOURCE CORPORATION REPORTS THIRD QUARTER RESULTS

COLORADO SPRINGS – November 3, 2015 – Gold Resource Corporation (NYSE MKT: GORO) (the “Company”) reported production results for the third quarter ended September 30, 2015 of 6,825 ounces of gold, 561,985 ounces of silver ounces, or 14,133 precious metal gold equivalent (AuEq) ounces (calculated at actual sales price ratio of 77:1), which generated $19.4 million in net revenue for the quarter.  Gold Resource Corporation is a gold and silver producer with operations in Oaxaca, Mexico and exploration in Nevada, USA.  The Company has returned over $107 million to shareholders in monthly dividends since commercial production commenced July 1, 2010, and offers shareholders the option to convert their cash dividends and take delivery in physical gold and silver.

2015 Q3 HIGHLIGHTS

·

14,133 ounces AuEq mill production

·

12,773 ounces AuEq sold

·

$19.4 million sales, net

·

$603 total cash cost per ounce AuEq (after by-product credits)

·

$6.4 million adjusted cash flow from mine site operations

·

$8.3 million by-product credits, or $647 per ounce AuEq sold

·

$1.6 million dividend distributions, or $0.03 per share for quarter

Overview of Q3 2015 Aguila Project Results

 

Gold Resource Corporation’s Aguila Project produced 14,133 ounces AuEq at a total cash cost of $603 per ounce (after by-product credits).  Realized average metal price sales during the quarter were $1,115 per ounce gold and $14.50 per ounce silver.  The Company recorded a net loss of $0.5 million, or $(0.01) per share.  Adjusted cash flow from mine site operations totaled $6.4 million.  The Company paid $1.6 million to shareholders in dividends, or $0.03 per share during the quarter.  Cash and cash equivalents at quarter end totaled $14.1 million.  Realized gold and silver prices decreased 14% and 28%, respectively, compared to the third quarter of 2014.

 

Production for the first three quarters of 2015 totaled 21,960 ounces of gold and 1,932,611 ounces of silver.  With the weaker than expected 2015 second and third quarter performance, the Company confirms its prior announcement related to the revised 2015 Outlook which reduced annual production targets to 29,600 gold ounces and 2,500,000 silver ounces, a reduction of 6% for gold ounces, and 16% for silver ounces.

 

The following table summarizes certain information about our mining operations for the three and nine months ended September 30, 2015 and 2014:

1

 

Production and Sales Statistics - Arista Underground Mine

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended  September 30, 

 

Nine months ended September 30, 

 

    

2015

    

2014

 

2015

 

2014

Milled

 

 

 

 

 

 

 

 

 

 

 

 

Tonnes Milled

 

 
105,309

 

 
79,568

 

 
300,190

 

 
283,793

Tonnes Milled per Day

 

 
1,143

 

 
865

 

 
1,104

 

 
1,040

Grade

 

 

 

 

 

 

 

 

 

 

 

 

Average Gold Grade (g/t)

 

 
2.25

 

 
2.78

 

 
2.52

 

 
3.18

Average Silver Grade (g/t)

 

 
180

 

 
291

 

 
216

 

 
297

Average Copper Grade (%)

 

 
0.41

 

 
0.47

 

 
0.39

 

 
0.40

Average Lead Grade (%)

 

 
1.41

 

 
2.12

 

 
1.37

 

 
1.52

Average Zinc Grade (%)

 

 
4.02

 

 
5.67

 

 
3.78

 

 
3.97

Recoveries

 

 

 

 

 

 

 

 

 

 

 

 

Average Gold Recovery (%)

 

 
90

 

 
92

 

 
90

 

 
92

Average Silver Recovery (%)

 

 
92

 

 
92

 

 
93

 

 
92

Average Copper Recovery (%)

 

 
80

 

 
76

 

 
79

 

 
78

Average Lead Recovery (%)

 

 
75

 

 
80

 

 
75

 

 
76

Average Zinc Recovery (%)

 

 
83

 

 
85

 

 
82

 

 
83

 

 

 

 

 

 

 

 

 

 

 

 

 

Mill production (before payable metal deductions)(1)

 

 

 

 

 

 

 

 

 

 

 

 

Gold (ozs.)

 

 
6,825

 

 
6,523

 

 
21,960

 

 
26,687

Silver (ozs.)

 

 
561,985

 

 
687,240

 

 
1,932,611

 

 
2,506,466

Copper (tonnes)

 

 
343

 

 
284

 

 
929

 

 
891

Lead (tonnes)

 

 
1,114

 

 
1,350

 

 
3,071

 

 
3,273

Zinc (tonnes)

 

 
3,499

 

 
3,816

 

 
9,299

 

 
9,340

Payable metal sold

 

 

 

 

 

 

 

 

 

 

 

 

Gold (ozs.)

 

 
6,220

 

 
2,932

 

 
21,994

 

 
19,846

Silver (ozs.)

 

 
503,929

 

 
575,413

 

 
1,770,093

 

 
2,171,298

Copper (tonnes)

 

 
332

 

 
228

 

 
877

 

 
751

Lead (tonnes)

 

 
1,049

 

 
1,204

 

 
2,875

 

 
2,938

Zinc (tonnes)

 

 
2,905

 

 
2,976

 

 
7,668

 

 
7,383

Average metal prices realized (2)

 

 

 

 

 

 

 

 

 

 

 

 

Gold ($ per oz.)

 

 
1,115

 

 
1,295

 

 
1,177

 

 
1,287

Silver ($ per oz.)

 

 
14.50

 

 
20.24

 

 
16.09

 

 
19.77

Copper ($ per tonne)

 

 
4,883

 

 
7,103

 

 
5,436

 

 
6,920

Lead ($ per tonne)

 

 
1,619

 

 
2,238

 

 
1,746

 

 
2,157

Zinc ($ per tonne)

 

 
1,701

 

 
2,394

 

 
1,981

 

 
2,209

Precious metal gold equivalent ounces produced (mill production) (1)(3)(4)

 

 

 

 

 

 

 

 

 

 

 

 

Gold Ounces

 

 
6,825

 

 
6,523

 

 
21,960

 

 
26,687

Gold Equivalent Ounces from Silver

 

 
7,308

 

 
10,739

 

 
26,410

 

 
38,495

Total Precious Metal Gold Equivalent Ounces

 

 
14,133

 

 
17,262

 

 
48,370

 

 
65,182

Precious metal gold equivalent ounces sold (3)(4)

 

 

 

 

 

 

 

 

 

 

 

 

Gold Ounces

 

 
6,220

 

 
2,932

 

 
21,994

 

 
19,846

Gold Equivalent Ounces from Silver

 

 
6,553

 

 
8,991

 

 
24,189

 

 
33,348

Total Precious Metal Gold Equivalent Ounces

 

 
12,773

 

 
11,923

 

 
46,183

 

 
53,194

Total cash cost (before by-product credits) per precious metal gold equivalent ounce sold (including royalties) (5)

 

$
1,250

 

$
1,324

 

$
1,046

 

$
958

Total cash costs, after by-product credits, per precious metal gold equivalent ounce sold (including royalties) (5)

 

$
603

 

$
364

 

$
505

 

$
434

(1)

Mill production represents metal contained in concentrates produced at the mill, which is before payable metal deductions are levied by the buyer of our concentrates. Payable metal deduction quantities are defined in our contracts with the buyer of our concentrates and represent an estimate of metal contained in the concentrates produced at our mill which the buyer cannot recover through the smelting process. There are inherent limitations and differences in the sampling method and assaying of estimated metal contained in concentrates that are shipped, and those contained metal estimates are derived from sampling methods and assaying throughout the mill production process. The Company monitors these differences to ensure that precious metal mill production quantities are materially correct.

(2)

Average metal prices realized vary from the market metal prices due to final settlement adjustments from our provisional invoices when they are settled. Our average metal prices realized will therefore differ from the market average metal prices in most cases.

(3)

For the three months ended September 30, 2015, precious metal gold equivalent mill production differs from gold equivalent ounces sold due principally to buyer (smelter) concentrate processing and other deductions of approximately 1,204 gold equivalent ounces and a decrease in gold equivalent ounces contained in ending inventory of approximately 121 ounces.

(4)

For the nine months ended September 30, 2015, precious metal gold equivalent mill production differs from gold equivalent ounces sold due principally to buyer (smelter) concentrate processing and other deductions of approximately 3,687 gold equivalent ounces and a decrease in gold equivalent ounces contained in ending inventory of approximately 279 ounces.

(5)

For a reconciliation of this non-GAAP measure to total mine cost of sales, which is the most comparable U.S. GAAP measure, please see Non-GAAP Measures.  

2

 

 

 

About GRC:

Gold Resource Corporation is a mining company focused on production and pursuing development of gold and silver projects that feature low operating costs and produce high returns on capital.  The Company has 100% interest in six potential high-grade gold and silver properties at its producing Oaxaca, Mexico Mining Unit and exploration properties at its Nevada, USA, Mining Unit.  The Company has 54,179,369 shares outstanding, no warrants, no long term debt and has returned over $107 million back to shareholders since commercial production commenced July 1, 2010.  Gold Resource Corporation offers shareholders the option to convert their cash dividends into physical gold and silver and take delivery.  For more information, please visit GRC’s website, located at www.Goldresourcecorp.com and read the Company’s 10-K for an understanding of the risk factors involved.

 

Cautionary Statements:

This press release contains forward-looking statements that involve risks and uncertainties. The statements contained in this press release that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. When used in this press release, the words “plan”, “target”, "anticipate," "believe," "estimate," "intend" and "expect" and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements include, without limitation, the statements regarding Gold Resource Corporation’s strategy, future plans for production, future expenses and costs, future liquidity and capital resources, and estimates of mineralized material. All forward-looking statements in this press release are based upon information available to Gold Resource Corporation on the date of this press release, and the company assumes no obligation to update any such forward-looking statements. Forward looking statements involve a number of risks and uncertainties, and there can be no assurance that such statements will prove to be accurate. The Company's actual results could differ materially from those discussed in this press release. In particular, there can be no assurance that production will continue at any specific rate.  Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the Company’s 10-K filed with the SEC.

Contacts:

Corporate Development

Greg Patterson

303-320-7708

www.Goldresourcecorp.com 

 

See Accompanying Tables

 

The following information summarizes the results of operations for Gold Resource Corporation for the three and nine months ended September 30, 2015 and 2014, its financial condition at September 30, 2015 and December 31, 2014 and its cash flows for the nine months ended September 30, 2015 and 2014.  The summary data for the three and nine months ended September 30, 2015 is unaudited; the summary data for the year ended December 31, 2014 is derived from our audited financial statements contained in our annual report on Form 10-K for the year ended December 31, 2014, but do not include the footnotes and other information that is included in the complete financial statements.  Readers are urged to review the Company’s Form 10-K in its entirety, which can be found on the SEC's website at www.sec.gov.

 

The calculation of our cash cost per ounce contained in this press release is a non-GAAP financial measure.  Please see "Management's Discussion and Analysis and Results of Operation" contained in the Company’s most recent Form 10-Q and Form 10-K for a complete discussion and reconciliation of the non-GAAP measures.

3

 

 

 

 

 

 

 

 

GOLD RESOURCE CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(U.S. dollars in thousands, except share and per share amounts)

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30, 

 

December 31, 

 

 

 

2015

 

2014

 

 

    

(Unaudited)

 

 

 

ASSETS

 

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

 

Cash and cash equivalents

 

$
14,105

 

$
27,541

 

Gold and silver bullion

 

 
3,160

 

 
3,447

 

Accounts receivable

 

 
1,851

 

 
1,416

 

Inventories

 

 
9,347

 

 
7,295

 

IVA taxes receivable

 

 
1,870

 

 
575

 

Deferred tax assets

 

 
3,891

 

 
3,891

 

Prepaid expenses and other current assets

 

 
1,932

 

 
2,935

 

Total current assets

 

 
36,156

 

 
47,100

 

Property, plant and mine development, net

 

 
47,808

 

 
32,348

 

Deferred tax assets

 

 
27,040

 

 
25,519

 

Investments in equity securities

 

 
894

 

 
2,620

 

Other non-current assets

 

 
2,964

 

 
4,078

 

Total assets

 

$
114,862

 

$
111,665

 

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

 

Accounts payable

 

$
8,201

 

$
3,892

 

Accrued expenses and other current liabilities

 

 
5,124

 

 
3,923

 

Capital lease obligations

 

 
1,220

 

 
1,498

 

Income taxes payable

 

 
3,348

 

 
7,907

 

Dividends payable

 

 
542

 

 
542

 

Total current liabilities

 

 
18,435

 

 
17,762

 

Capital lease obligations

 

 

 -

 

 
834

 

Reclamation and remediation liabilities

 

 
2,537

 

 
2,993

 

Total liabilities

 

 
20,972

 

 
21,589

 

Shareholders' equity:

 

 

 

 

 

 

 

Preferred stock - $0.001 par value, 5,000,000 shares authorized:

 

 

 

 

 

 

 

no shares issued and outstanding

 

 

 -

 

 

 -

 

Common stock - $0.001 par value, 100,000,000 shares authorized:

 

 

 

 

 

 

 

54,515,767 shares issued and outstanding

 

 
55

 

 
55

 

Additional paid-in capital

 

 
96,387

 

 
93,094

 

Retained earnings

 

 
4,503

 

 
3,982

 

Treasury stock at cost, 336,398 shares

 

 
(5,884)

 

 
(5,884)

 

Accumulated other comprehensive loss

 

 
(1,171)

 

 
(1,171)

 

Total shareholders' equity

 

 
93,890

 

 
90,076

 

Total liabilities and shareholders' equity

 

$
114,862

 

$
111,665

 

 

4

 

 

 

 

 

GOLD RESOURCE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

for the three and nine months ended September  30, 2015 and 2014

(U.S. dollars in thousands, except share and per share amounts)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended  September 30, 

 

Nine months ended September 30, 

 

 

    

2015

    

2014

    

2015

    

2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Sales, net

 

$
19,437

 

$
21,052

 

$
71,082

 

$
85,873

 

Mine cost of sales:

 

 

 

 

 

 

 

 

 

 

 

 

 

Production costs

 

 
13,411

 

 
13,025

 

 
40,462

 

 
43,107

 

Depreciation and amortization

 

 
1,579

 

 
1,180

 

 
5,195

 

 
2,969

 

Reclamation and remediation

 

 
6

 

 

 -

 

 
36

 

 

 -

 

Total mine cost of sales

 

 
14,996

 

 
14,205

 

 
45,693

 

 
46,076

 

Mine gross profit

 

 
4,441

 

 
6,847

 

 
25,389

 

 
39,797

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

General and administrative expenses

 

 
2,913

 

 
4,361

 

 
8,032

 

 
9,623

 

Exploration expenses

 

 
1,810

 

 
2,901

 

 
6,416

 

 
5,786

 

Total costs and expenses

 

 
4,723

 

 
7,262

 

 
14,448

 

 
15,409

 

Operating (loss) income

 

 
(282)

 

 
(415)

 

 
10,941

 

 
24,388

 

Other (expense) income, net

 

 
(1,033)

 

 
69

 

 
(2,080)

 

 
766

 

(Loss) income before income taxes

 

 
(1,315)

 

 
(346)

 

 
8,861

 

 
25,154

 

Provision for income taxes

 

 
(846)

 

 
1,109

 

 
3,465

 

 
12,264

 

Net (loss) income

 

$
(469)

 

$
(1,455)

 

$
5,396

 

$
12,890

 

Net (loss) income per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$
(0.01)

 

$
(0.03)

 

$
0.10

 

$
0.24

 

Diluted

 

$
(0.01)

 

$
(0.03)

 

$
0.10

 

$
0.24

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 
54,179,369

 

 
54,179,369

 

 
54,179,369

 

 
54,098,783

 

Diluted

 

 
54,179,369

 

 
54,179,369

 

 
54,201,274

 

 
54,698,748

 

 

5

 

 

 

 

 

 

 

 

GOLD RESOURCE CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

for the nine months ended September  30, 2015 and 2014

(U.S. dollars in thousands)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

    

2015

    

2014

 

 

 

 

 

 

 

 

 

Cash flows from operating activities:

    

 

 

 

 

 

 

Net income

 

$
5,396

 

$
12,890

 

Adjustments to reconcile net income to net cash from operating activities:

 

 

 

 

 

 

 

Depreciation, depletion and amortization

 

 
6,331

 

 
3,107

 

Stock-based compensation

 

 
3,293

 

 
3,847

 

Deferred income taxes

 

 
(1,522)

 

 

 -

 

Currency exchange (gain) loss

 

 
(326)

 

 
545

 

Unrealized loss (gain) on investments

 

 
1,726

 

 
(1,504)

 

Other operating adjustments

 

 
1,072

 

 
162

 

Changes in operating assets and liabilities:

 

 

 

 

 

 

 

Accounts receivable

 

 
(435)

 

 
(3,699)

 

Inventories

 

 
(1,149)

 

 
(1,582)

 

Prepaid expenses and other current assets

 

 
(897)

 

 
1,354

 

Accounts payable and other accrued liabilities

 

 
5,069

 

 
(731)

 

Income taxes payable/receivable

 

 
(4,528)

 

 
11,907

 

Other noncurrent assets

 

 
466

 

 

 -

 

Net cash provided by operating activities

 

 
14,496

 

 
26,296

 

Cash flows from investing activities:

 

 

 

 

 

 

 

Capital expenditures

 

 
(21,837)

 

 
(10,524)

 

Investments

 

 

 -

 

 
(1,805)

 

Proceeds from sale of building

 

 

 -

 

 
1,737

 

Other investing activities

 

 
40

 

 
23

 

Net cash used in investing activities

 

 
(21,797)

 

 
(10,569)

 

Cash flows from financing activities:

 

 

 

 

 

 

 

Proceeds from exercise of stock options

 

 

 -

 

 
100

 

Dividends paid

 

 
(4,876)

 

 
(4,868)

 

Repayment of capital leases

 

 
(1,123)

 

 
(1,099)

 

Net cash used in financing activities

 

 
(5,999)

 

 
(5,867)

 

Effect of exchange rate changes on cash and cash equivalents

 

 
(136)

 

 
(33)

 

Net (decrease) increase in cash and cash equivalents

 

 
(13,436)

 

 
9,827

 

Cash and cash equivalents at beginning of period

 

 
27,541

 

 
14,973

 

Cash and cash equivalents at end of period

 

$
14,105

 

$
24,800

 

Supplemental Cash Flow Information

 

 

 

 

 

 

 

Interest expense paid

 

$
65

 

$
139

 

Income and mining taxes paid

 

$
8,464

 

$

 -

 

 

6