NYSE - MKT: ASM
TSX-V: ASM
FSE:
GV6
VANCOUVER, March 1, 2017 /CNW/ - Avino Silver & Gold Mines Ltd. (ASM: TSX-V,
ASM: NYSE–MKT, GV6: FSE, "Avino" or "the Company") is pleased
to announce the consolidated financial results for the Company's
fourth quarter and year ended December
31, 2016. The financial statements and the management
discussion and analysis can be viewed on the Company's web site at
www.avino.com, on SEDAR at www.sedar.com and on EDGAR at
www.sec.gov.
FOURTH QUARTER 2016 HIGHLIGHTS
- Generated revenues of $12.0
million from the sale of San Gonzalo and Avino
concentrates
- Mine operating income amounted to $3.5
million an increase of 141% over the same period of
2015
- Net income after taxes amounted to $1.2
million or a Basic EPS of $0.03
- Produced 707,775 silver equivalent ounces, including 419,355
ounces of silver, 2,581 ounces of gold and 755,645 pounds of
copper
- Total consolidated cash1 cost was $11.50 (US$8.62)
per payable silver ounce
- Consolidated all-in sustaining cost ("AISC")1 was
$13.36 (US$10.01) per payable silver equivalent ounce, a
5% increase compared to $12.70
(US$9.51) per ounce in the fourth
quarter of 2015
- Average realized selling prices for silver and gold were
US$16.69 and US$1,194 per ounce respectively
- Cash of $15.8 million and short
term investments consisting of cash of $13.4
million was on hand at the end of the quarter
2016 HIGHLIGHTS
- Generated revenues of $39.9
million from sales of San Gonzalo and Avino
concentrates
- Mine operating income was $14.5
million, an increase of 79%
- Net income after taxes amounted to $2.0
million or a Basic EPS of $0.05
- Operating cash flows before movements in working capital to
$7.6 million or $0.18 per
share - Basic
- Produced 2,679,334 silver equivalent ounces, including
1,612,060 million ounces of silver, 7,119 ounces of gold and
4,206,585 pounds of copper
- Total cash cost1 was $11.24 (US$8.48)
per silver equivalent ounce
- All-in sustaining cost ("AISC")1 was $13.70 (US$10.34)
per payable silver ounce, a 13% increase compared to $12.14 (US$9.49)
per ounce in 2015
- Average realized selling prices for silver and gold were
US$17.71 and US$1,258 per ounce respectively
- Cash of $15.8 million and short
term investments consisting of cash of $13.4
million were on hand at December 31,
2016
- Invested $10.7 million in capital
expenditures net of concentrate proceeds of $6.2 million from the sales of Avino mine
concentrates
1 The
Company reports non-IFRS measures which include cash cost per
silver equivalent ounce, all-in sustaining cash cost per ounce, and
cash flow per share. These measures are widely used in the mining
industry as a benchmark for performance, but do not have a
standardized meaning and the calculation methods may differ from
methods used by other companies with similar reported
measures.
|
"I am very pleased to report that Avino continued to deliver
strong financial and operating results in 2016, with consistent
silver equivalent production and solid performance from our Avino
and San Gonzalo mines, our cornerstone assets from which to grow
the company from. We continue to meet management's
expectations, and with stringent cost controls we exited the year
with strong fundamentals in place. Our steady results are due
to the dedication of our teams in both Canada and Mexico. Our focus for 2017 remains consistent
operating results and moving forward with our plans for plant and
mine expansion to increase throughput capacity at the processing
plant by an estimated 70%, the advancement of the Oxide Tailings
Resource project, continued construction and consideration of new
initiatives regarding tailings storage, and the previously
announced three-phased expansion program at Bralorne."
- David Wolfin, President, CEO
& Director
HIGHLIGHTS
|
Fourth
Quarter 2016
|
Fourth
Quarter 2015
|
Change
|
Year
2016
|
Year
2015
|
Change
|
Operating
|
Tonnes
Milled
|
134,688
|
136,817
|
-2%
|
544,336
|
517,887
|
5%
|
Silver Ounces
Produced
|
419,355
|
409,216
|
2%
|
1,612,060
|
1,625,285
|
-1%
|
Gold Ounces
Produced
|
2,581
|
1,588
|
63%
|
7,119
|
7,083
|
1%
|
Copper Pounds
Produced
|
755,645
|
1,271,565
|
-41%
|
4,206,585
|
4,743,691
|
-11%
|
Silver Equivalent
Ounces1 Produced
|
707,775
|
761,767
|
-7%
|
2,679,334
|
3,020,348
|
-11%
|
Consolidated San
Gonzalo and Avino Sales
|
Silver Equivalent
Ounces Sold2
|
644,479
|
241,114
|
167%
|
2,035,618
|
1,140,029
|
79%
|
Cash Cost per Silver
Equivalent Ounce2
|
$
|
11.50
|
$
|
8.24
|
40%
|
$
|
11.24
|
$
|
8.45
|
33%
|
US$ Cash Cost per
Silver Equivalent Ounce2,3
|
US$
|
8.62
|
US$
|
6.17
|
40%
|
US$
|
8.48
|
US$
|
6.61
|
28%
|
All-in Sustaining
Cost per Silver Equivalent Ounce2,3
|
$
|
13.36
|
$
|
12.70
|
5%
|
$
|
13.70
|
$
|
12.14
|
13%
|
US$ All-in Sustaining
Cost per Silver Equivalent Ounce2,3
|
US$
|
10.01
|
US$
|
9.51
|
5%
|
US$
|
10.34
|
US$
|
9.49
|
9%
|
Average Realized
Silver Price per Ounce ($US)
|
US$
|
16.69
|
US$
|
14.29
|
17%
|
US$
|
17.71
|
$
|
15.46
|
15%
|
Average Realized Gold
Price per Ounce ($US)
|
US$
|
1,194
|
US$
|
1,092
|
9%
|
US$
|
1,258
|
$
|
1,148
|
10%
|
Average Realized
Copper Price per Tonne ($US)
|
US$
|
5,313
|
-
|
100%
|
US$
|
4,850
|
-
|
100%
|
Financial
|
Revenues
|
$
|
12,006,667
|
$
|
3,860,109
|
211%
|
$
|
39,895,591
|
$
|
19,082,847
|
109%
|
Mine Operating
Income
|
$
|
3,546,929
|
$
|
1,471,826
|
141%
|
$
|
14,503,700
|
$
|
8,121,153
|
79%
|
Net Income
|
$
|
1,217,821
|
$
|
370,675
|
229%
|
$
|
1,992,479
|
$
|
483,424
|
312%
|
Cash
|
$
|
15,816,628
|
$
|
7,475,134
|
291%
|
$
|
15,816,628
|
$
|
7,475,134
|
291%
|
Working
Capital
|
$
|
31,293,019
|
$
|
6,003,557
|
421%
|
$
|
31,293,019
|
$
|
6,003,557
|
421%
|
Shareholders
|
Earnings per Share
("EPS") – Basic
|
$
|
0.03
|
$
|
0.01
|
200%
|
$
|
0.05
|
$
|
0.01
|
400%
|
Cash Flow per Share
3 – Basic
|
$
|
0.06
|
$
|
(0.03)
|
300%
|
$
|
0.18
|
$
|
0.01
|
1700%
|
|
1. Metal
production is expressed in terms of silver equivalent ounces (oz Ag
Eq), In 2016, AgEq was calculated using metals prices of $17.10 oz
Ag, $1,248 oz Au and $2.21 lb Cu. In 2015, AgEq was calculated
using $16 oz Ag, $1,150 oz Au and $3.00 lb Cu
|
|
2. "Silver
equivalent ounces sold" for the purposes of cash costs and all-in
sustaining costs consists of the sum of silver ounces, gold ounces
and copper tonnes sold multiplied by the ratio of the average spot
gold and copper prices to the average spot silver price for the
corresponding period.
|
|
3. The Company
reports non-IFRS measures which include cash cost per silver
equivalent ounce, all-in sustaining cash cost per ounce, and cash
flow per share. These measures are widely used in the mining
industry as a benchmark for performance, but do not have a
standardized meaning and the calculation methods may differ from
methods used by other companies with similar reported
measures.
|
Financial Results
The Company generated revenues of $39.9
million during 2016; a 109% increase compared with 2015, due
to the Avino Mine entering into production at levels intended by
management effective April 1, 2016.
In 2015, the Avino mine was in development phase and proceeds from
the sale of Avino Mine Concentrate were classified as a recovery of
exploration and evaluation expenditures. Higher metal prices
for silver and gold were also a contributing factor.
Mine operating income was $14.5
million during 2016, an increase of $6.4 million or 79% from $8.1 million in 2015. During the year of 2016,
net income increased by $1.5 million
to $2.0 million or $0.05 basic and diluted per share, compared to
net income of $0.5 million or
$0.01 basic and diluted per share
during 2015. The primary reason for the increase is the addition of
revenue from the Avino Mine. The Company continues to maintain
efficient and controlled cost models and will continue to evaluate
and optimize tax planning strategies.
Operational Results
Silver equivalent production for 2016 decreased by 11% to
2,679,334 oz1 compared to 3,020,348 oz in 2015. Silver
production for 2016 decreased 1% to 1,612,060 oz compared to 2015.
Gold production for 2016 increased by 1% to 7,119 oz compared to
7,083 oz in 2015. Copper production for 2016 decreased by 11% to
4,206,585 lbs compared to 4,743,691 lbs in 2015. Total mill
feed processed during 2016 was 544,336 dry tonnes compared to
517,887 dry tonnes during 2015, an increase of 5%.
At the Avino mine, the silver equivalent ounces¹ produced during
2016 totalled 1,606,272 which was a decrease of 11%, mainly due to
a decrease in the grade of the copper in the concentrate, changes
in the feed grades processed, and required maintenance on the Mill
Circuit 3 ball mill during the second quarter of 2016.
At the San Gonzalo Mine, the silver equivalent
ounces1 produced during 2016 totalled 1,073,062 compared
to 1,218,351 produced in 2015. This represents a 12% decrease
compared to 2015 mainly due to mining taking place in different
areas in 2016, as well as Mill Circuit 2 primarily devoted to
processing Avino Mine material.
Costs and Capital Expenditures
Consolidated all-in sustaining cash costs per AgEq
ounce1 during 2016 were $13.70 (US$10.34)
compared to $12.14 (US$9.49) during the period of 2015, an increase
of 10% mainly due to grade fluctuations. As we continue to
transition from development mining to production mining we
anticipate achieving lower production costs.
Capital expenditures during 2016, net of concentrate proceeds of
$6.2 million, were $10.7 million compared to $8.9 million during 2015.
Capital expenditures primarily relate to advancing the Avino
Mines which included installation of a new power line to the mine
site, exploration at the Avino Mine, the purchasing of new mining,
milling/processing and transportation equipment, as well as
advancing the Bralorne Mine and exploration and mining
equipment.
Bralorne Mine
During 2016, the Company continued to develop a strategic
operating plan to achieve a profitable operation at Bralorne. The
company engaged independent engineering professionals to assist in
developing a project execution plan to enable production start-up
at 100 TPD with eventual expansion to 300 TPD. Independent
mining engineers were also engaged to develop a long term mine plan
which includes a change to narrow vein long hole mining wherever
possible, to replace the historic labour intensive shrinkage mining
method. Together with their input, the Company has
established a three-phased and disciplined approach to the Bralorne
project development which was previously announced in a news
release dated January 23, 2017 and is
available on the company's website at
http://www.avino.com/s/news.asp?ReportID=776401. New mining
equipment is being acquired to replace older equipment and to
further mechanize for long hole mining. The first work to be
carried out underground will be to test the long hole mining
method.
Additionally, the Company announced on October 21, 2016 the results of an updated NI
43-101 resource estimate for the property, the news release and
full technical report are available on the company's website at
http://www.avino.com/i/pdf/nr/2016-10-21_NR-k2iodud98.pdf
and
http://www.avino.com/i/pdf/reports/2016_Bralorne_Tech_Report_Final.pdf
respectively. The dam for the Tailings Storage Facility ("TSF") was
raised in October 2015, and
additional buttress work was completed on the tailing's impoundment
during the third quarter of 2016. The Interim Mine Closure Plan
("IMCP") and review process is underway and is expected to be
completed in the first quarter of 2017. The new Water Treatment
Plant ("WTP") was enclosed in a new building in November to protect
it from the elements and is ready for freshet in early 2017. The
work on the TSF, the IMCP, WTP and the strategic operating plan are
all contributing to the Company's goal of obtaining the permits
from British Columbia's Ministry
of Energy & Mines and Ministry of Environment to resume
processing and mining activities in 2017.
In 2016, in conjunction with North Island College and St'at'imc
Government Services, Avino completed a four-month underground
mining training educational cohort for 12 members of the St'at'imc
communities. All 12 students graduated from the program and
received a number of industry certification tickets. The
program, funded largely by the provincial government, involved
three months of classroom instruction in Lillooet followed by two weeks of hands on
training at the Bralorne Gold Mine. To view the video on the
training program please click here
https://vimeo.com/172272150.
A second similar program commenced in November, 2016, and
included a state-of-the-art simulator from Sandvik for advanced
training on underground mining equipment. This program finished in
February, 2017, with the graduation to be held on March 3, 2017. Avino is eager to hire
graduates from the programs once the mine re-opens.
1. Metal
production is expressed in terms of silver equivalent ounces (oz Ag
Eq), In 2016, AgEq was calculated using metals prices of $17.10 oz
Ag, $1,248 oz Au and $2.21 lb Cu. In 2015, AgEq was calculated
using $16 oz Ag, $1,150 oz Au and $3.00 lb Cu
|
|
2."Silver
equivalent ounces sold" for the purposes of cash costs and all-in
sustaining costs consists of the sum of silver ounces, gold ounces
and copper tonnes sold multiplied by the ratio of the average spot
gold and copper prices to the average spot silver price for the
corresponding period.
|
|
3. The Company
reports non-IFRS measures which include cash cost per silver
equivalent ounce, all-in sustaining cash cost per ounce, and cash
flow per share. These measures are widely used in the mining
industry as a benchmark for performance, but do not have a
standardized meaning and the calculation methods may differ from
methods used by other companies with similar reported
measures.
|
Non-IFRS Measures
The financial results in this news release include references to
cash flow per share, cash cost per silver equivalent ounce, and
all-in sustaining cash cost per silver equivalent ounce, each of
which are non-IFRS measures. Cash flow per share, cash cost per
ounce, and all-in sustaining cash cost per ounce are measures
developed by mining companies in an effort to provide a comparable
standard of performance. However, there can be no assurance that
our reporting of these non-IFRS measures is similar to that
reported by other mining companies. Cash flow per share, cash cost
per silver equivalent ounce, and all-in sustaining cash cost per
silver equivalent ounce are measures used by the Company to manage
and evaluate operating performance of the Company's mining
operations, and are widely reported in the silver and gold mining
industry as benchmarks for performance, but do not have
standardized meanings prescribed by IFRS, and are disclosed in
addition to the prescribed IFRS measures provided in the Company's
financial statements and MD&A.
Conference Call
Avino will be holding a conference call on Thursday, March 2, 2017 at 8 am PST (11 am
EST).
To participate in the conference call, please dial the
following:
Toll Free Canada & USA:
1-800-319-4610
Outside of Canada &
USA: 1-604-638-5340
No pass-code is necessary to participate in the conference call;
participants will have the opportunity to ask questions during the
Q&A portion of the call.
Participants should dial in 10 minutes prior to the
conference.
The conference call will be recorded and the replay will be
available on the Company's web site within one hour following the
conclusion of the call.
Qualified Person(s)
Avino's Mexican projects are under the supervision of Mr.
Chris Sampson, P.Eng, BSc, Avino
consultant and Mr. Jasman Yee,
P.Eng, Avino director; Avino's Bralorne Mine project is under the
supervision of Fred Sveinson, B.A.,
BSc, P.Eng, Avino Senior Mining Advisor. These individuals are
qualified persons ("QP") within the context of National Instrument
43-101. The respective QP's have reviewed and approved all the
applicable technical data in this MD&A.
Outlook
Avino's mission is to create shareholder value through
profitable organic growth at the Avino Property and the strategic
acquisition and advancement of mineral exploration and mining
properties. We are committed to expanding our operations and
managing all business activities in an environmentally responsible
and cost-effective manner while contributing to the well-being of
the communities in which we operate.
The Company remains focused on the following key objectives:
- Maintain and improve profitable mining operations while
managing operating costs and achieving efficiencies;
- Advance the Bralorne project towards profitable
production;
- Explore regional targets on the Avino Property followed by
other properties in our portfolio;
- Assess the potential for processing the oxide tailings resource
from previous milling operations and;
- Identify and evaluate potential projects for acquisition.
1. Metal
production is expressed in terms of silver equivalent ounces (oz Ag
Eq), In 2016, AgEq was calculated using metals prices of $17.10 oz
Ag, $1,248 oz Au and $2.21 lb Cu. In 2015, AgEq was calculated
using $16 oz Ag, $1,150 oz Au and $3.00 lb Cu
|
|
2."Silver
equivalent ounces sold" for the purposes of cash costs and all-in
sustaining costs consists of the sum of silver ounces, gold ounces
and copper tonnes sold multiplied by the ratio of the average spot
gold and copper prices to the average spot silver price for the
corresponding period.
|
|
3.The Company
reports non-IFRS measures which include cash cost per silver
equivalent ounce, all-in sustaining cash cost per ounce, and cash
flow per share. These measures are widely used in the mining
industry as a benchmark for performance, but do not have a
standardized meaning and the calculation methods may differ from
methods used by other companies with similar reported
measures.
|
On Behalf of the Board
"David
Wolfin"
________________________________
David Wolfin
President & CEO
Avino Silver & Gold Mines
Ltd.
Safe Harbor Statement - This news release contains
"forward-looking information" and "forward-looking statements"
(together, the "forward-looking statements") within the meaning of
applicable securities laws and the United States Private Securities
Litigation Reform Act of 1995, including our belief as to the
extent and timing of various studies including the PEA, and
exploration results, the potential tonnage, grades and content of
deposits, and timing, establishment, and extent of resource
estimates. These forward-looking statements are made as of the date
of this news release and the dates of technical reports, as
applicable. Readers are cautioned not to place undue reliance on
forward-looking statements, as there can be no assurance that the
future circumstances, outcomes or results anticipated in or implied
by such forward-looking statements will occur or that plans,
intentions or expectations upon which the forward-looking
statements are based will occur. While we have based these
forward-looking statements on our expectations about future events
as at the date that such statements were prepared, the statements
are not a guarantee that such future events will occur and are
subject to risks, uncertainties, assumptions and other factors
which could cause events or outcomes to differ materially from
those expressed or implied by such forward-looking
statements.
Such factors and assumptions include, among others, the
effects of general economic conditions, the price of gold, silver
and copper, changing foreign exchange rates and actions by
government authorities, uncertainties associated with legal
proceedings and negotiations and misjudgments in the course of
preparing forward-looking information. In addition, there are known
and unknown risk factors which could cause our actual results,
performance or achievements to differ materially from any future
results, performance or achievements expressed or implied by the
forward-looking statements. Known risk factors include risks
associated with project development; the need for additional
financing; operational risks associated with mining and mineral
processing; fluctuations in metal prices; title matters;
uncertainties and risks related to carrying on business in foreign
countries; environmental liability claims and insurance; reliance
on key personnel; the potential for conflicts of interest among
certain of our officers, directors or promoters with certain other
projects; the absence of dividends; currency fluctuations;
competition; dilution; the volatility of our common share price and
volume; tax consequences to U.S. investors; and other risks and
uncertainties. Although we have 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 cause actions, events
or results not to be as anticipated, estimated or intended. There
can be no assurance that forward-looking statements will prove to
be accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward-looking
statements. We are under no obligation to update or alter any
forward-looking statements except as required under applicable
securities laws.
Cautionary Note to United States Investors - The information
contained herein and incorporated by reference herein has been
prepared in accordance with the requirements of Canadian securities
laws, which differ from the requirements of United States securities laws. In particular,
the term "resource" does not equate to the term "reserve". The
Securities Exchange Commission's (the "SEC") disclosure standards
normally do not permit the inclusion of information concerning
"measured mineral resources", "indicated mineral resources" or
"inferred mineral resources" or other descriptions of the amount of
mineralization in mineral deposits that do not constitute
"reserves" by SEC standards, unless such information is required to
be disclosed by the law of the Company's jurisdiction of
incorporation or of a jurisdiction in which its securities are
traded. U.S. investors should also understand that "inferred
mineral resources" have a great amount of uncertainty as to their
existence and great uncertainty as to their economic and legal
feasibility. Disclosure of "contained ounces" is permitted
disclosure under Canadian regulations; however, the SEC normally
only permits issuers to report mineralization that does not
constitute "reserves" by SEC standards as in place tonnage and
grade without reference to unit measures.
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
SOURCE Avino Silver & Gold
Mines Ltd.