0001279569-12-001038.txt : 20120815 0001279569-12-001038.hdr.sgml : 20120815 20120814202950 ACCESSION NUMBER: 0001279569-12-001038 CONFORMED SUBMISSION TYPE: 6-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20120814 FILED AS OF DATE: 20120815 DATE AS OF CHANGE: 20120814 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Jaguar Mining Inc CENTRAL INDEX KEY: 0001333849 STANDARD INDUSTRIAL CLASSIFICATION: METAL MINING [1000] IRS NUMBER: 980396253 STATE OF INCORPORATION: A6 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 6-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-33548 FILM NUMBER: 121035140 BUSINESS ADDRESS: STREET 1: 125 NORTH STATE STREET CITY: CONCORD STATE: NH ZIP: 03301 BUSINESS PHONE: 603-224-4800 MAIL ADDRESS: STREET 1: 125 NORTH STATE STREET CITY: CONCORD STATE: NH ZIP: 03301 6-K 1 jaguar6k.htm FORM 6-K

 

 

FORM 6-K

 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16 under the

Securities Exchange Act of 1934

 

For the month of August 2012

Commission File Number 001-33548

 

JAGUAR MINING INC. 

 

 

Rua Levindo Lopes 323 - Funcionários

CEP 30140-170 - Belo Horizonte – MG - Brazil

(31) 3232-7100

 

(Address of principal executive offices.)

 

 

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

 

Form 20-F   o Form 40-F   x

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): o

 

Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.

 

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): o

 

Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.

 

 

 

 

 
 

 

 

EXHIBIT INDEX

 

Exhibit Number   Description of Exhibit
     
99.1 News Release Dated August 14, 2012 - Jaguar Mining Reports Second Quarter 2012 Financial Results, Cash Costs Improving at Continuing Operations

 

 

 
 

SIGNATURE

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

  JAGUAR MINING INC.  
       
Date: August 14, 2012 By: /s/ James M. Roller    
    Name: James M. Roller  
    Title: Chief Financial Officer  
       

 

 

 

EX-99.1 2 ex991.htm NEWS RELEASE DATED AUGUST 14, 2012 - EARNINGS RELEASE

Exhibit 99.1

 

 

Jaguar Mining Reports Second Quarter 2012 Financial Results, Cash Costs Improving at Continuing Operations

JAG - TSX/NYSE

BELO HORIZONTE, Brazil, Aug. 14, 2012 /CNW/ - Jaguar Mining Inc. ("Jaguar" or the "Company") (JAG: TSX/NYSE) today reported a net loss of $16.4 million or $0.19 per fully diluted share for the quarter ended June 30, 2012.  This result compares to net income of $15.6 million or $0.18 per fully diluted share in the second quarter of 2011. The second quarter 2012 result includes a $57.4 million unrealized non-cash gain on the conversion option embedded in convertible debt (see note 1), a $7.7 million loss from changing foreign exchange rates and a $47.7 million impairment charge on the assets at Paciência (see note 2).  Excluding these items, Jaguar's second quarter result was a net loss of $18.4 million or $0.22 per fully diluted share.

For the six month period ended June 30, 2012, Jaguar reported a net loss of $13.5 million or $0.16 per fully diluted share.  This compares to net income of $19.3 million or $0.23 per fully diluted share in the six month period ended June 30, 2011.

Jaguar sold 28,933 ounces of gold at an average realized price of $1,608 per ounce in the three months ended June 30, 2012 compared to 40,184 ounces of gold at an average realized price of $1,507 per ounce in the three months ended June 30, 2011.  Average cash operating cost per ounce was $1,162 in the second quarter 2012 compared to $1,268 in the first quarter 2012 and $799 in the second quarter 2011.  Cash operating margin was $446 in the second quarter 2012 compared to $423 per ounce in the first quarter 2012 and $708 per ounce in the second quarter 2011.  Excluding the limited production and sales from Paciência, the average cash operating cost in the second quarter 2012 was $1,027 per ounce.

The decrease in the Company's average cash operating cost per ounce during the second quarter 2012 as compared to the first quarter 2012 was attributable to Jaguar's on-going cost reduction program which included placing the Paciência operation on care and maintenance beginning in May 2012.  The increase in average cash operating cost per ounce as compared to the second quarter of 2011 was attributable to higher mining dilution, lower total production which resulted in higher fixed cost absorption per ounce, and increased costs for labor, services, equipment maintenance and mining materials.

Commenting on the Company's results and operations, John Andrews, Jaguar's Interim CEO stated, "We are beginning to see some positive results from our cost reduction program.  At our continuing operations, Turmalina and Caeté, average cash cost per ounce improved by 16% and 15%, respectively, when compared to the first quarter of 2012.  We believe this is a good start but we recognize that we have much more work ahead of us before we reach our objectives for improved productivity and profitability."

Summary of Key Operating Results - Consolidated

Three months ended June 30 Six months ended June 30
2012 2011 2012 2011
(unaudited) 
($ in 000s, except per share amounts)
Gold sales   $ 46,535  $ 60,557  $ 97,507  $ 115,697
Ounces sold 28,933 40,184 59,071 79,978
Average sales price $ / ounce 1,608 1,507 1,651 1,447
Gross profit (loss) (5,044) 12,849 (8,722) 23,818
Net income (loss) (16,350) 15,586 (13,541) 19,310
Basic income (loss) per share (0.19) 0.18 (0.16) 0.23
Diluted income (loss) per share (0.19) 0.18 (0.16) 0.23
Weighted avg. # of shares outstanding - basic 84,409,648 84,373,648 84,409,648 84,373,648
Weighted avg. # of shares outstanding - diluted 84,409,648 84,376,376 84,409,648 84,377,786

 

Key Operating Statistics - By Operation

Three Months Ended June 30, 2012 Operating Data 
Ore
Processed
(t000)
Feed Grade
(g/t)
Plant
Recovery Rate
(%)
Production
(ounces)
Cash
Operating
Cost/t
Cash
Operating
Cost/ounce
Turmalina  154 2.35 90% 10,435  $ 73.70  $ 1,125
Paciência 37 1.91 87% 2,649 140.00 2,219
Caeté 160 3.05 90% 13,804 81.10 953
Total 351 2.62 89% 26,888  $ 84.00  $ 1,162
Six Months Ended June 30, 2012 Operating Data 
Ore
Processed
(t000)
Feed Grade
(g/t)
Plant
Recovery Rate
(%)
Production
(ounces)
Cash
Operating
Cost/t
Cash
Operating
Cost/ounce
Turmalina  312 2.18 90% 20,448  $ 79.50  $ 1,232
Paciência 170 2.15 90% 9,987 92.30 1,536
Caeté 315 3.06 90% 27,685 88.20 1,036
Total 797 2.52 90% 58,120  $ 85.70  $ 1,191
Three Months Ended June 30, 2011 Operating Data 
Ore
Processed
(t000)
Feed Grade
(g/t)
Plant
Recovery Rate
(%)
Production
(ounces)
Cash
Operating
Cost/t
Cash
Operating
Cost/ounce
Turmalina  158 3.30 90% 15,872  $ 75.40  $ 800
Paciência 116 3.39 92% 12,263 66.70 637
Caeté 161 2.83 86% 12,122 71.00 961
Total 435 3.15 89% 40,257  $ 71.60  $ 799
Six Months Ended June 30, 2011 Operating Data 
Ore
Processed
(t000)
Feed Grade
(g/t)
Plant
Recovery Rate
(%)
Production
(ounces)
Cash
Operating
Cost/t
Cash
Operating
Cost/ounce
Turmalina  294 3.63 90% 31,727  $ 74.90  $ 778
Paciência 234 3.32 93% 24,378 61.00 596
Caeté 327 2.86 87% 25,601 70.00 903
Total 855 3.25 90% 81,706  $ 69.30  $ 763

 

2012 Estimated Production and Cash Operating Cost

Based on the first half operating results and the continuing implementation of its restructuring and cost reduction program, Jaguar is revising its outlook for both production and cash operating costs in 2012.  The Company now expects 2012 gold production in the range of 110,000 to 120,000 ounces.  On this new volume, cash operating costs are expected to be in the range of $900 to $1,000 per ounce (based on an assumed exchange rate of R$2.00 per US$) as the planned benefits of the turnaround plan will not be fully realized until 2013.  The Company's revised preliminary annual targets for its Southern operations is 105,000 to 115,000 ounces in 2013 at cash operating costs in the range $600 to $700 per ounce.

Conference Call Details

Members of the Jaguar senior management team will hold a conference call to discuss the second quarter results and operations on Wednesday, August 15, 2012 at 12:00 p.m. ET.  The call can be accessed via telephone or webcast.

Conference call access details:
Live teleconference access:
US Dial In (Toll Free):
International Dial In:

1-866-524-3160
1-412-317-6760
Live audio webcast:    www.jaguarmining.com
Replay:
US Toll Free: 1-877-344-7529
International Toll: 1-412-317-0088
Conference Number: 10016976
 

About Jaguar Mining

Jaguar is a junior gold producer in Brazil with operations in a prolific greenstone belt in the state of Minas Gerais and is developing the Gurupi Project in Northern Brazil in the state of Maranhão.  The Company is actively exploring and developing additional mineral resources at its approximate 220,000-hectare land base in Brazil.  Additional information is available on the Company's website at www.jaguarmining.com.

Forward Looking Statements

Certain statements in this press release constitute "Forward-Looking Statements" within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and Canadian securities legislation.  Forward-Looking Statements can be identified by the use of words, such as "are expected", "is forecast", "is targeted", "approximately" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might", or "will" be taken, occur or be achieved.  Forward-Looking Statements involve known and unknown risks, uncertainties and other factors which may cause the actual results or performance to be materially different from any future results or performance expressed or implied by the Forward-Looking Statements.

These factors include the inherent risks involved in the exploration and development of mineral properties, the uncertainties involved in interpreting drilling results and other geological data, fluctuating gold prices and monetary exchange rates, the possibility of project cost delays and overruns or unanticipated costs and expenses, uncertainties relating to the availability and costs of financing needed in the future, uncertainties related to production rates, timing of production and the cash and total costs of production, changes in applicable laws including laws related to mining development, environmental protection, and the protection of the health and safety of mine workers, the availability of labor and equipment, the possibility of labor strikes and work stoppages and changes in general economic conditions.  Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in Forward-Looking Statements, there may be other factors that could cause actions, events or results to differ from those anticipated, estimated or intended.

These Forward-Looking Statements represent the Company's views as of the date of this press release.  The Company anticipates that subsequent events and developments may cause the Company's views to change.  The Company does not undertake to update any forward-looking statements, either written or oral, that may be made from time to time by or on behalf of the Company subsequent to the date of this discussion except as required by law. For a discussion of important factors affecting the Company, including fluctuations in the price of gold and exchange rates, uncertainty in the calculation of mineral resources, competition, uncertainty concerning geological conditions and governmental regulations and assumptions underlying the Company's forward-looking statements, see the "CAUTIONARY NOTE" regarding forward-looking statements and "RISK FACTORS" in the Company's Annual Information Form for the year ended December 31, 2011 filed on SEDAR and available at http://www.sedar.com and the Company's Annual Report on Form 40-F for the year ended December 31, 2011 filed with the United States Securities and Exchange Commission and available at www.sec.gov.

Note: As required by applicable Canadian rules, effective Q1 2011, Jaguar has prepared its financial statements in accordance with International Financial Reporting Standards ("IFRS").

Additional details will be available in the Company's filings on SEDAR and EDGAR, including Management's Discussion and Analysis of Financial Condition and Results of Operations and Consolidated Financial Statements for the period ended June 30, 2012.

The following tables contain unaudited information for the quarter and six month period ended June 30, 2012.  The data presented are subject to final adjustment, but are believed to be materially accurate. Jaguar's financial statements for the period ended June 30, 2012 are expected to be filed on SEDAR and EDGAR on August 15, 2012.  Readers should refer to those filings for the final financial statements and the associated footnotes which are an integral part of the tables.

JAGUAR MINING INC.
Condensed Interim Consolidated Balance Sheets
(Expressed in thousands of U.S. dollars)    
   
(Unaudited)    
June 30,
2012
December 31,
2011
   
   
Assets    
Current assets:    
Cash and cash equivalents   $ 31,944  $ 74,475    
Inventory 27,921 34,060    
Prepaid expenses and sundry assets 31,550 25,541    
Derivatives 114 -    
91,529 134,076    
   
Prepaid expenses and sundry assets  42,039 48,068    
Restricted cash  909 909    
Property, plant and equipment  352,486 388,675    
Mineral exploration projects  94,743 88,938    
   
 $ 581,706  $ 660,666    
   
Liabilities and Shareholders' Equity    
Current liabilities:    
Accounts payable and accrued liabilities  $ 33,133  $ 34,922    
Notes payable  29,138 22,517    
Income taxes payable  17,628 18,953    
Reclamation provisions 1,877 2,082    
Other provisions 4,960 4,347    
Deferred compensation liabilities 59 2,953    
Other liabilities  - 1,475    
86,795 87,249    
   
Notes payable  233,844 228,938    
Option component of convertible notes 8,179 79,931    
Deferred income taxes  10,504 8,635    
Reclamation provisions 17,522 15,495    
Deferred compensation liabilities 489 2,270    
Other liabilities  105 339    
Total liabilities 357,438 422,857    
   
Shareholders' equity:    
Share capital 370,043 370,043    
Stock options  12,155 14,207    
Contributed surplus  5,466 3,414    
Deficit (163,396) (149,855)    
Total equity attributable to equity shareholders of the Company 224,268 237,809    
   
Contingent liability    
Subsequent event    
 $ 581,706  $ 660,666    

 

JAGUAR MINING INC.
Condensed Interim Consolidated Statements of Operations and Comprehensive Income (Loss)    
(Expressed in thousands of U.S. dollars, except per share amounts)
(Unaudited)
Three Months
Ended
June 30,
2012
Three Months
Ended
June 30,
2011
Six Months
Ended
June 30,
2012
Six Months
Ended
June 30,
2011
Gold sales  $ 46,535  $ 60,557  $ 97,507  $ 115,697
Production costs (41,250) (36,837) (82,650) (69,893)
Stock-based compensation 301 (28) 343 (23)
Depletion and amortization (10,630) (10,843) (23,922) (21,963)
Gross profit (loss) (5,044) 12,849 (8,722) 23,818
Operating expenses:
Exploration 26 717 71 1,051
Stock-based compensation  (1,487) (393) (2,295) (3,084)
Administration 2,601 5,419 8,946 10,674
Management fees - 363 - 524
Amortization 292 313 581 670
Other 590 234 991 1,071
Total operating expenses 2,022 6,653 8,294 10,906
Income (loss) before the following (7,066) 6,196 (17,016) 12,912
Gain on derivatives (114) (126) (114) (413)
Gain on conversion option embedded in convertible debt (57,427) (9,180) (71,752) (7,840)
Foreign exchange loss (gain) 7,685 (6,527) 4,511 (9,616)
Accretion expense 537 624 1,133 1,194
Interest expense  7,077 7,074 14,201 12,757
Interest income (566) (2,867) (2,424) (4,332)
Gain on disposition of property (90) (472) (368) (998)
Impairment of Paciência property 47,692 - 47,692 -
Other non-operating expenses (income) 566 (128) 534 (321)
Total other expenses (income) 5,360 (11,602) (6,587) (9,569)
Income (loss) before income taxes (12,426) 17,798 (10,429) 22,481
Income taxes 
Current income taxes 302 1,428 621 1,933
Deferred income taxes  3,622 784 2,491 1,238
Total income taxes  3,924 2,212 3,112 3,171
Net income (loss) and comprehensive income (loss) for the period  $ (16,350)  $ 15,586  $ (13,541)  $ 19,310
Basic and diluted earnings (loss) per share   $ (0.19)  $ 0.18  $ (0.16)  $ 0.23
Weighted average number of common shares outstanding - basic 84,409,648 84,373,648 84,409,648 84,373,648
Weighted average common shares outstanding - diluted 84,409,648 84,376,376 84,409,648 84,377,786

 

JAGUAR MINING INC.
Condensed Interim Consolidated Statements of Cash Flows
(Expressed in thousands of U.S. dollars)
(Unaudited)
Three Months
Ended
June 30,
2012
Three Months
Ended
June 30,
2011
Six Months
Ended
June 30,
2012
Six Months
Ended
June 30,
2011
Cash provided by (used in):
Operating activities:
Net income (loss) and comprehensive income (loss) for the period  $ (16,350)  $ 15,586  $ (13,541)  $ 19,310
Adjustments to reconcile net earnings to net cash provided from 
(used in) operating activities:
Unrealized foreign exchange loss (gain) 3,318 (3,955) (1,734) (6,749)
Stock-based compensation expense recovered (1,788) (365) (2,638) (3,061)
Interest expense 7,077 7,074 14,201 12,757
Accretion of interest income - (94) - (188)
Accretion expense 537 624 1,133 1,194
Income taxes recovery - (104) - (104)
Deferred income taxes 3,622 784 2,491 1,238
Depletion and amortization 10,922 11,156 24,503 22,633
Loss on disposition of property, plant and equipment 532 - 547 -
Write-down of Paciência inventory 3,222 - 2,394 -
Impairment of Paciência property  47,692 - 47,692 -
Unrealized gain on derivatives (114) (28) (114) (29)
Unrealized gain on option component of convertible note (57,427) (9,180) (71,752) (7,840)
Reclamation expenditure (10) (8) (113) (26)
1,233 21,490 3,069 39,135
Change in non-cash operating working capital
Inventory 5,844 (1,334) 3,732 933
Prepaid expenses and sundry assets (4,365) (5,420) (7,148) (7,476)
Accounts payable and accrued liabilities (863) 4,697 (2,241) 5,380
Income taxes payable (917) 2,315 (1,325) 3,325
Provisions 296 - 613 -
Deferred compensation liabilities (656) (83) (2,268) (244)
572 21,665 (5,568) 41,053
Financing activities:
Repayment of debt (1,119) (4,117) (2,218) (7,935)
Increase in debt 1,000 - 7,000 99,313
Interest paid (3,841) (4,254) (6,994) (4,615)
Other liabilities (1,630) 7 (1,709) (55)
(5,590) (8,364) (3,921) 86,708
Investing activities:
Mineral exploration projects (1,800) (2,266) (6,963) (4,611)
Purchase of property, plant and equipment (12,029) (23,735) (31,017) (41,602)
Proceeds from disposition of property 659 - 684 -
(13,170) (26,001) (37,296) (46,213)
Effect of foreign exchange on non-U.S. dollar denominated 
cash and cash equivalents 269 2,557 4,254 4,629
Increase (decrease) in cash and cash equivalents (17,919) (10,143) (42,531) 86,177
Cash and cash equivalents, beginning of period 49,863 135,543 74,475 39,223
Cash and cash equivalents, end of period  $ 31,944  $ 125,400  $ 31,944  $ 125,400

 

Note 1 - Fair Valuation of Derivative Financial Instruments - Option Component of Convertible Notes

IFRS requires that derivative financial instruments be valued on a periodic basis. The option components of the Company's convertible notes are considered derivative financial instruments and are fair valued using the Crank - Nicolson valuation model using inputs, such as volatility and credit spread.

The carrying amount of the option components of the convertible notes was $8.2 million at June 30, 2012 (December 31, 2011 - $79.9 million). The change in fair value of $57.4 million and $71.8 million for the three and six month periods ended June 30, 2012, respectively, is shown as a gain on conversion option embedded in convertible debt in the Statements of Operations and Comprehensive Income (three and six month periods ended June 30, 2011 - $9.2 million gain and $7.8 million gain, respectively).

Note 2 - Impairment on Paciência Property

Over the past year the Paciência (CPA) operations have faced significant and increasing challenges. Recent reviews determined that a complete remediation plan would best be accomplished by placing the operations on a temporary care and maintenance program until the necessary design and structural changes have been implemented in the mines. The remediation plans for CPA include an adaptation of the narrow vein overhand stoping methods, a changeover to smaller scale equipment, smaller development headings, reduced stope dimensions and building the developed reserve inventory prior to restarting the plant. Implementation of the plan is expected to result in improved productivity per ounce, reduced mining dilution, reliable and predictable production forecasts, and significant reductions in cash costs per ounce when the mines return to production. As a result of the temporary shutdown the company considered this an indicator of impairment and prepared an impairment test on the Paciência operation.

The impairment test resulted in an impairment loss of $47.7 million during the second quarter of 2012 and is recorded in 'Impairment of Paciência property" in the Interim Consolidated Statements of Operations and Comprehensive Income (Loss), (three and six months ended June 2011 - $nil).  The Paciência property is a cash generating unit ("CGU") which includes Property, plant and equipment assets including land, and plant, mineral rights, deferred exploration costs, and asset retirement obligations net of amortization relating to properties formerly in production. The CGU also includes Mineral exploration project assets relating to properties not in production such as mineral rights and deferred exploration costs.  $46.3 million of the loss was taken against assets in Property, plant and equipment and $1.4 million of the loss was recognized relating to assets included in Mineral exploration projects.  The recoverable amount of the project is the cash generating unit's fair value less costs to sell. The following assumptions were used to value the property:

Discount Rate: 8%
Gold price: $1,275 - 1,600

Non IFRS Reconciliations

Summary of  Cash Operating Cost per Ounce of Gold Produced
Three months ended Six Months ended
June 30, 2012 June 30, 2012
Production costs per statement of operations  $ 33,786,000  $   71,384,000
Change in inventory  (4,209,493) (2,162,606)
Operational cost of gold produced  29,576,507 69,221,394
divided by 
Gold produced (oz) 26,888 58,120
equals
Cost per oz of gold produced  $ 1,162  $ 1,191

 

Cash Operating Margin Per Ounce of Gold
Three months ended  Six months ended 
June 30, 2012 June 30, 2012
Average sales price per oz of gold  $ 1,608  $ 1,651
less
Cash operating cost per oz of gold produced 1,162 1,191
equals
Cash operating margin per oz of gold  $ 446  $ 460

 

 

SOURCE: Jaguar Mining Inc.

%CIK: 0001333849

For further information:

Company Contacts

Roger Hendriksen
Vice President, Investor Relations
603-410-4888
rhendriksen@jaguarmining.com

Valéria Rezende DioDato
Director of Communication
011-55-31-4042-1249
valeria@jaguarmining.com

CO: Jaguar Mining Inc.

CNW 19:59e 14-AUG-12