Mining Stocks News: SilverCrest (TSX: SVL) (NYSE MKT: SVLC)
Announces 2014 Financial Results - Cash Flow from Operations of $13.8 million
($0.12 per share) - Adjusted Earnings of $5.2 million ($0.04 per share)
Vancouver,
BC - March 26, 2015 (Investorideas.com Mining Stocks Newswire) SilverCrest
Mines Inc. (TSX:SVL) (NYSE MKT: SVLC) is pleased to announce its audited consolidated
financial results for the fourth quarter ("Q4") and year ended
December 31, 2014. The fourth
quarter and 2014 year end financials results reflect a one-time non-cash
impairment charge accounting adjustment of $4.96 million. All financial
information is prepared in accordance with International Financial Reporting
Standards ("IFRS") and all dollar amounts are expressed in U.S.
dollars unless otherwise specified. The information in this news release should
be read in conjunction with the Company's audited consolidated financial
statements for the year ended December 31, 2014 and associated management
discussion and analysis ("MD&A") which are available from the
Company's website at www.silvercrestmines.com and under the Company's
profile on SEDAR at www.sedar.com.
Q4 FINANCIALS CONFERENCE CALL
A
conference call to discuss the results for the 2014 fourth quarter and year-end
financial results will be held on Thursday, March 26, 2015. The call will be
held at 10am PDT (1pm EDT). To participate in the conference call, please dial
the following:
Updated
Participant Dial-In Number(s)
Local/international: (647) 427-3415
North American toll-free: 1 888 241-0551
Local/international: (647) 427-3415
North American toll-free: 1 888 241-0551
A replay
of the conference call will be archived for later playback on the Company's
website www.silvercrestmines.com.
2014 YEAR END FINANCIAL
HIGHLIGHTS:
·
Cash flow
from operations (1)(2) $13.8 million ($0.12 per share, basic)
·
Cash
operating cost per AgEq ounce sold (2) $9.64 (Ag:Au 60:1)
·
All-in
sustaining cash cost per AgEq ounce sold (2) $14.35 (Ag:Au 60:1)
·
Revenues
reported $45.1 million (net of $8.5 million sales capitalized(3))
·
Metal
sales 1,177,936 ounces of silver (annual record) and 28,678 ounces of gold
·
Realized
average spot metal prices $18.23 for silver and $1,256 for gold
·
Mine
operating earnings $13.4 million
·
Impairment
charges $4.96 million (non-cash accounting entry)
·
Net loss
$1.5 million ($0.01 per share, basic and diluted)
·
Adjusted
earnings $5.2 million ($0.04 per share, basic and diluted)
·
Cash and
cash equivalents $31.3 million (at Dec. 31, 2014)
·
Working
capital $40.9 million (at Dec. 31, 2014)
·
Scotiabank
Credit Facility $15.0 million drawn from $30.0 million available (at Dec. 31,
2014)
Scott
Drever, Chief Executive Officer and Director, stated; "2014 was another
challenging but successful year for SilverCrest, as we transitioned from an
open pit heap leaching operation at Santa Elena to an underground mining and
milling operation. By the start of the fourth quarter, we had successfully
commissioned both the underground mine and the 3,000 tonnes per day
("tpd") mill and processing facilities. SilverCrest achieved 93% of
its 2014 metal production guidance, in spite of the early closure of the open
pit and short-term delays encountered with underground stope production. Low
metal prices and one-time impairment charges totaling $4.96 million impacted
our financial performance in 2014. SilverCrest generated cash flow from
operations of $13.8 million ($0.12 per share) in 2014 and is confident in Santa
Elena's ability to generate positive cash flows in 2015, notwithstanding the
lower precious metals price environment. SilverCrest expects annual production
for 2015 to range between 4.0 – 4.4 million ounces of AgEq (Ag:Au 66.7:1), a
significant increase over 2014 production of 2.81 million AgEq ounces.
SilverCrest continues to have a strong balance sheet through disciplined cost
controls with $31.3 million in cash (at Dec 31, 2014) and undrawn credit
facility of $15 million."
(1) Cash
flow from operations before changes in working capital items.
(2) These
are Non-IFRS performance measures. Refer to "CAUTIONARY NOTE REGARDING
NON-IFRS PERFORMANCE MEASURES". Silver equivalent ("AgEq")
ounces consist of the number of ounces of silver production/sold plus the
number of ounces of gold production/sold multiplied by a 60:1 gold price to
silver price ratio, as determined in the 2014 budget. Prior to Q1 2014, the
AgEq ratio was based on the spot gold price to the spot silver price at the
quarter end dates for financial reporting. For fiscal 2013 and Q4 2013, the
gold price to silver price ratio was 60.5:1 and 61.6:1, respectively. All
numbers are rounded.
(3) Prior
to completing the commissioning of Santa Elena's Expansion, the Company
capitalized proceeds from sales of silver and gold ounces and related expenses
attributed to the underground mine, mill and CCD/MC processing facilities. For
the year ended December 31, 2014, the Company capitalized sales proceeds of
$8,520,350 (2013 – $748,654) related to pre-commercial production to Santa
Elena's Mining Assets included within property, plant and equipment.
Fourth Quarter ended December 31,
2014
Adjusted
loss(2) for the fourth quarter amounted to $2,035,929 ($0.02 per share, basic
and diluted), compared to adjusted earnings of $1,621,246 ($0.01 per share,
basic and diluted) in 2013. Net loss was $5,539,328 ($0.05 per share, basic and
diluted) for the fourth quarter compared with $4,094,410 ($0.04 per share,
basic and diluted) in 2013. The net loss in Q4 2014 was primarily attributed to
lower mine operating earnings generated at Santa Elena and non-cash impairment
charges totalling $4.96 million. In Q4 2013, the Company recorded a one-time
non-cash deferred tax charge of $5.8 million as a result of the enactment of
the Mexican Tax Reform.
Silver
and gold revenues totalled $16,406,592 (2013 – $12,866,617) in the fourth
quarter. Silver sales of 422,250 ounces (2013 – 208,200), were a quarterly
record and a 103% increase over the same period in 2013. The foregoing,
combined with a 21% lower average realized price of $16.00 (2013 – $20.20) per
ounce, resulted in only 61% higher silver revenue. Total gold revenue reported
in the fourth quarter increased 3% compared to the same period in 2013. Total
gold sales were 8,968 ounces (2013 – 8,220), or 9% higher than in the same
period in 2013. The Company sold 7,394 (2013 – 6,576) ounces of gold at an
average realized price of $1,185 (2013 – $1,250) per ounce, a 5% decline. The
Company delivered 1,574 gold ounces (2013 – 1,644) under the Sandstorm Purchase
Agreement at $354 cash (2013 – $350) per ounce.
Cost of
sales amounted to $11,427,777 (2013 – $5,185,211). Cash operating cost(2) and
all-in sustaining cash cost(2) per AgEq ounce sold in Q4 2014 were $11.90 and
$17.98 (Ag:Au 60.0:1) per ounce, respectively, compared to $7.68 and $12.71
(Ag:Au 61.6:1) per ounce in Q4 2013. The increase in cash operating cost per
AgEq ounce for Q4 2014 is a result of additional direct production costs due to
the transition of Santa Elena during 2014 from an open pit heap leach operation
to an underground mining and milling operation. The increase in all-in sustaining
cash operating cost per AgEq ounce for Q4 is a result of higher production
costs and the inclusion of Santa Elena's sustaining underground development,
infrastructure and equipment costs. The Company anticipates operating cash cost
to average $10-$11 per AgEq ounce and all-in sustaining cash cost to average
$14-$15 per AgEq ounce for 2015 as underground production ramps up and reaches
average budgeted levels of 1,320 tpd.
Depletion,
depreciation and amortization increased to $3,150,393 (2013 – $1,618,884) with
the incorporation of the quarterly deprecation charge for Santa Elena's new
mill and CCD/MC processing facilities. General and administrative expenses
decreased by 20% to $2,321,740 (2013 – $2,885,989) primarily due to a decrease
in remuneration expense. Remuneration expense decreased by 41% to $933,501
(2013 – $1,581,482) primarily from the reduction in annual bonuses paid in Q4
to management and employees.
During Q4
2014, the Company recorded impairment charges totalling $4,956,418 (2013 – $Nil)
related to write downs of property, plant and equipment and mineral properties.
The Company recorded an impairment charge of $1,911,198 against crushing
equipment no longer in use at Santa Elena and wrote-off the book value of the
Cruz de Mayo Project ($2,875,168) and other exploration properties ($170,052).
Current
income tax expense amounted to $632,000 (2013 – $1,580,000). The decrease in
tax expense in Q4 is primarily attributable to the Company taking a 100% tax
deduction for 2014 development costs incurred at Santa Elena. The foregoing,
combined with lower operating margins, resulted in a lower current income tax
charge compared with Q4 2013.
Deferred
tax recovery was $2,047,000 (2013 – expense of $5,420,000) primarily as a
result of the 2014 non capital loss the Company generated which will be
available to utilize against taxable income in future periods. The 2014 Mexican
non capital loss was partially offset by additional temporary differences
recognized for financial statement carrying amounts and their respective
Mexican tax book bases. Recognized within the Q4 recovery is $374,000 (2013 –
$nil) drawn down from the $5.8 million deferred taxes recognized in Q4 2013 due
to the enactment of the Mexican Tax Reform.
Year ended December 31, 2014
Adjusted
earnings(2) for fiscal 2014 amounted to $5,238,021 ($0.04 per share, basic and
diluted), compared to $16,147,593 ($0.15 per share, basic and diluted) in 2013.
Net loss was $1,515,975 ($0.01 loss per share, basic and diluted) for fiscal
2014, compared with earnings of $8,479,263 ($0.08 per share, basic and diluted)
in 2013. The loss recognized in fiscal 2014 was primarily driven by 1) a
decrease in revenues from lower realized prices, 2) an increase in direct
production costs as Santa Elena transitioned during 2014 from an open pit heap
leach operation to an underground mining and milling operation, and 3) Q4
non-cash impairment charges totalling $4.96 million.
Silver
and gold revenues totalled $45,132,599 (2013 – $54,893,651) for fiscal 2014.
Silver sales amounted to 1,177,936 ounces (2013 – 751,633), which includes
206,323 (2013 – 13,881) capitalized ounces(3), 57% higher when compared to
2013. The foregoing, combined with a 21% lower average realized price of $18.23
(2013 – $22.97) per ounce, resulted in only 24% higher silver revenue. Total
gold revenue reported during fiscal 2014 decreased 16% compared to the same
period in 2013. Total gold sales were 28,678 ounces (2013 – 30,487), which
includes 4,096 (2013 – 409) capitalized ounces(3), or 6% below the same period
in 2013. The Company sold 23,162 (2013 – 24,389) ounces of gold at an average
realized price of $1,256 (2013 – $1,392) per ounce, a 10% decline. The Company
delivered 5,516 gold ounces (2013 – 6,097) under the Sandstorm Purchase
Agreement at $353 cash (2013 – $350) per ounce.
Cost of
sales amounted to $23,596,973 (2013 – $19,895,374). Cash operating cost per
AgEq ounce(2) sold during the year was $9.64 (Ag:Au 60.0:1) per ounce compared
to $7.78 (Ag:Au 60.5:1) per ounce in 2013. All-in sustaining cash cost per AgEq
ounce(2) sold in fiscal 2014 was $14.35 (Ag:Au 60.0:1) per ounce compared to
$13.04 (Ag:Au 60.5:1) per ounce in 2013. The primary drivers for the increase
in cash operating cost and all-in sustaining cash cost are the same as those
outlined above in the fourth quarter comparison.
General
and administrative expenses decreased by 6% to $6,504,047 (2013 – $6,951,892).
The decrease is primarily from a reduction in remuneration as lower annual bonuses
were paid in Q4 to management and employees.
Impairment
charges totalled $4,956,418 (2013 – $Nil) and current and deferred tax expense
totalled $262,000 (2013 – $5,450,000) and $514,000 (2013 – $7,418,000)
respectively. Refer to the fourth quarter comparison for explanations of the
primary drivers.
OUTLOOK FOR 2015
SilverCrest's
immediate focus is to (i) continue the efficient operation of its flagship
Santa Elena low cost silver and gold mine, (ii) increase underground ore
production rates from current average rates of 1,200 tpd to average rates of
1,500 tpd by the end of 2015 to achieve an average rate of 1,320 tpd for fiscal
2015, (iii) SEDAR file a Technical Report by March 31, 2015 to update the Santa
Elena Reserves, Resource estimates, and life of mine plan, (iv) expand
resources and associated reserves at Santa Elena by continued systematic exploration
of the deposit, (v) continue to evaluate and acquire low cost exploration
properties in proximity to Santa Elena, (vi) update the La Joya resource model
for a new resource estimate in 2015, and (vii) manage a strong cash position to
support growth while sustaining existing operations.
The
Qualified Person under National Instrument 43-101 Standards of Disclosure for
Mineral Projects for this news release is N. Eric Fier, CPG, P.Eng, Chief
Operating Officer and Director of SilverCrest Mines Inc., who has reviewed and
approved its contents.
SilverCrest Mines Inc. (NYSE MKT:
SVLC; TSX: SVL) is
a Canadian precious metals producer headquartered in Vancouver, BC. SilverCrest
flagship property is the 100%-owned Santa Elena Mine, located 150 kilometres
northeast of Hermosillo, near Banamichi in the State of Sonora, México. The
mine is a highgrade, epithermal silver and gold producer, with an estimated
life of mine of 7 years at an average operating cash costs of $11 per ounce of
silver equivalent (55:1 Ag:Au). SilverCrest anticipates that the new 3,000
tonnes per day conventional mill facility at the Santa Elena Mine should
recover an average of 1.5 million ounces of silver and 32,800 ounces of gold
per annum over the current reserve life. Exploration programs continue to
result in new discoveries at Santa Elena and also have rapidly advanced the definition
of a large polymetallic deposit at the La Joya property in Durango State,
Mexico.
CAUTIONARY NOTE REGARDING
FORWARD-LOOKING STATEMENTS
This news
release contains "forward-looking statements" within the meaning of
Canadian securities legislation and the United States Securities Litigation
Reform Act of 1995. Such forward-looking statements concern the Company's
anticipated results and developments in the Company's operations in future
periods, planned exploration and development of its properties, plans related
to its business and other matters that may occur in the future and include,
without limitation, statements with respect to: the economic viability of a
project; strategic plans and expectations for the development of the Company's
operations and properties; the amount of mineral reserves and mineral
resources; the amount of future production of gold and silver over any period;
the amount of expected grades and ounces of metals and minerals; cash operating
costs; and life of mine.
These
forward-looking statements relate to analyses and other information that are
based on, without limitation, the following estimates and assumptions: the
presence of and continuity of metals at the Company's projects; cost of
production and productivity levels; plant and equipment function as
anticipated; the availability of skilled labour; contracted parties provide
goods and services on agreed time frame; ability to develop and finance
projects; accuracy of the interpretations and assumptions used in calculating
reserve and resource estimates; and operations not being disrupted or delayed
by unusual geological or technical problems.
Forward-looking
statements are subject to a variety of known and unknown risks, uncertainties
and other factors which could cause actual events or results to differ from
those expressed or implied by the forward-looking statements, including,
without limitation: risks related to precious and base metal price
fluctuations; risks related to fluctuations in the currency markets (particularly
the Mexican peso, Canadian dollar and United States dollar); risks related to
the inherently dangerous activity of mining, including conditions or events
beyond our control, and operating or technical difficulties in mineral
exploration, development and mining activities; uncertainty in the Company's
ability fund the exploration and development of its mineral properties;
uncertainty as to actual capital costs, operating costs, production and
economic returns, and uncertainty that development activities will result in
profitable mining operations; risks related to reserves and mineral resource
figures being estimates based on interpretations and assumptions which may
result in less mineral production under actual conditions than is currently
estimated and to diminishing quantities or grades of mineral reserves as
properties are mined; and risks related to governmental regulations and
obtaining necessary licenses and permits.
Should
one or more of these risks and uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially from those
described in the forward-looking statements. The Company's forward-looking
statements are based on beliefs, expectations and opinions of management on the
date the statements are made. For the reasons set forth above, investors should
not place undue reliance on forward-looking statements. The Company undertakes
no obligation to update or revise any forward-looking statements included in
this news release if these beliefs, estimates and opinions or other
circumstances should change, except as otherwise required by applicable law.
Contact:
Fred
Cooper
Telephone: (604) 694-1730 ext. 108
Fax: (604) 694-1761
Toll Free: 1-866-691-1730
Email: info@silvercrestmines.com
Website: www.silvercrestmines.com
Suite 501 - 570 Granville Street, Vancouver, BC Canada V6C 3P1
Telephone: (604) 694-1730 ext. 108
Fax: (604) 694-1761
Toll Free: 1-866-691-1730
Email: info@silvercrestmines.com
Website: www.silvercrestmines.com
Suite 501 - 570 Granville Street, Vancouver, BC Canada V6C 3P1
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