Atico Mining Corporation (the “Company” or “Atico”) (TSX.V: ATY |
OTCQX: ATCMF) today announced its financial results for the three
months ended March 31, 2023, posting a net loss of $0.5 million.
Production for the period at Atico’s El Roble mine totaled 2.3
million pounds (“lbs”) of copper and 2,553 ounces (“oz”) of gold in
concentrate at a cash cost(1) of $2.20 per payable pound of
copper(2).
Fernando E. Ganoza, CEO and Director, commented,
“Lower grade and throughput than planned for this period impacted
our financials for the quarter. The mechanical failures experienced
during the fourth quarter of last year which carried through to
this quarter have been resolved and we have now moved back into
higher grade zones. These should be reflected in the El Roble
production results for the second quarter as we anticipate we will
be able to make up for the slow start of the year throughout the
remaining quarters” said Fernando E. Ganoza, CEO. “In parallel we
will focus on the on-going drill program at El Roble mine vicinity
aimed at replacing ore and extending the life of mine.”
First Quarter Financial
Highlights
- Net loss for the quarter amounted
to $0.5 million, compared with income of $3.9 million for the
comparative quarter. The decrease was primarily due to lower sales,
and a higher cost per pound of copper, impacting income from mining
operations.
- Sales for the quarter decreased 38%
to $12.8 million when compared with $20.6 million in Q1-2022.
Copper (“Cu”) and gold (“Au”) accounted for 84% and 16% of the
6,475 (Q1-2022 – 9,568) dry metric tonnes (“DMT”) sold during
Q1-2023. Sales during the quarter were impacted by lower quantities
sold and at a lower copper price compared to Q1-2022.
- The average realized price per
metal was $4.15 per pound of copper and $2,139 per ounce of
gold.
- Ending working capital was $15.0
million and the Company had $15.7 million in long-term loans
payable.
- Cash costs (1) were $127.33 per
tonne of processed ore and $2.20 per pound of payable copper
produced, which were an increase of 2% and a 71% over Q1-2022,
respectively.
- Cash margin was $1.95 (Q1-2022 -
$3.36) per pound of payable copper produced, which was a decrease
of 42% over Q1-2022 due to lower copper price and higher cash costs
per pound.
- All-in sustaining cash cost per
payable pound of copper produced(1)(2) was $3.34.
First Quarter Summary of Financial
Results
|
|
Q12023 |
|
Q12022 |
|
%Change |
|
Revenue |
|
$ |
12,783,240 |
|
$ |
20,645,001 |
|
-38 |
% |
Cost of sales |
|
|
(10,702,409 |
) |
|
(11,551,647 |
) |
-7 |
% |
Income from mining operations |
|
|
2,080,831 |
|
|
9,093,354 |
|
-77 |
% |
As a % of revenue |
|
|
16 |
% |
|
44 |
% |
-63 |
% |
General and administrative expenses |
|
|
1,466,716 |
|
|
1,277,676 |
|
15 |
% |
Income from operations |
|
|
573,062 |
|
|
7,623,353 |
|
-92 |
% |
As a % of revenue |
|
|
4 |
% |
|
37 |
% |
-88 |
% |
Income before income taxes |
|
|
197,191 |
|
|
7,919,534 |
|
-98 |
% |
Net income |
|
|
(499,670 |
) |
|
3,900,202 |
|
-113 |
% |
As a % of revenue |
|
|
-4 |
% |
|
19 |
% |
-121 |
% |
Operating cash flow before changes in non-cash operating working
capital items(1) |
|
$ |
2,039,380 |
|
$ |
11,156,820 |
|
-82 |
% |
First Quarter Operational
Review
In Q1-2023, the Company produced 2.3 million lbs
of copper, 2,553 oz of gold, and 8,335 oz of silver. The decrease
in copper production is mainly due to the decrease in grade.
Cash costs(1) were $127.33 per tonne of
processed ore and $2.20 per pound of payable copper produced, which
were an increase of 2% and a decrease of 71% over Q1-2022,
respectively. The increase in cash cost per pound of payable copper
produced compared to the comparative period is due to lower copper
grade partially offset by higher gold (by-product) credits.
First Quarter Operational
Details
|
|
Q12023 |
|
Q12022 |
|
%Change |
|
Production (Contained metals)(3) |
|
|
|
|
|
|
Copper (000s lbs) |
|
2,310 |
|
4,731 |
|
-51 |
% |
Gold (oz) |
|
2,553 |
|
2,636 |
|
-3 |
% |
Silver (oz) |
|
8,335 |
|
8,779 |
|
-5 |
% |
Mine |
|
|
|
|
|
|
Tonnes of material mined |
|
60,568 |
|
66,594 |
|
-9 |
% |
Mill |
|
|
|
|
|
|
Tonnes processed |
|
62,793 |
|
65,844 |
|
-5 |
% |
Tonnes processed per day |
|
747 |
|
826 |
|
-10 |
% |
Copper grade (%) |
|
1.87 |
|
3.55 |
|
-47 |
% |
Gold grade (g/t) |
|
2.23 |
|
2.08 |
|
7 |
% |
Silver grade (g/t) |
|
23.07 |
|
7.69 |
|
200 |
% |
Recoveries |
|
|
|
|
|
|
Copper (%) |
|
89.2 |
|
91.8 |
|
-3 |
% |
Gold (%) |
|
57.0 |
|
59.7 |
|
5 |
% |
Silver (%) |
|
37.5 |
|
53.8 |
|
-30 |
% |
Concentrates |
|
|
|
|
|
|
Copper Concentrates (DMT) |
|
5,815 |
|
10,719 |
|
-46 |
% |
Copper (%) |
|
18.1 |
|
20.0 |
|
-10 |
% |
Gold (g/t) |
|
13.7 |
|
7.9 |
|
73 |
% |
Silver (g/t) |
|
44.8 |
|
25.9 |
|
73 |
% |
|
|
|
|
|
|
|
Payable copper produced (000s lbs) |
|
2,174 |
|
4,576 |
|
-53 |
% |
Cash cost per pound of payable copper ($/lbs)(1)(2) |
|
2.20 |
|
1.29 |
|
71 |
% |
The financial statements and MD&A are
available on SEDAR and have also been posted on the Company's
website at
http://www.aticomining.com/s/FinancialStatements.asp.
El Roble Mine
The El Roble mine is a high grade, underground
copper and gold mine with nominal processing plant capacity of
1,000 tonnes per day, located in the Department of Choco in
Colombia. Its commercial product is a copper-gold concentrate.
Since obtaining control of the mine on November
22, 2013, Atico has upgraded the operation from a historical
nominal capacity of 400 tonnes per day.
El Roble has Proven and Probable reserves of
1.00 million tonnes grading 3.02% copper and 1.76 g/t gold, at a
cut-off grade of 1.3% copper equivalent with an effective date of
September 30, 2020. Mineralization is open at depth and along
strike and the Company plans to further test the limits of the
deposit. On the larger land package, the Company has identified a
prospective stratigraphic contact between volcanic rocks and black
and grey pelagic sediments and cherts that has been traced by Atico
geologists for ten kilometers. This contact has been determined to
be an important control on VMS mineralization on which Atico has
identified numerous target areas prospective for VMS type
mineralization occurrence, which is the focus of the current
surface drill program at El Roble.
La Plata Overview
Atico’s wholly-owned La Plata project is a gold
rich volcanogenic massive sulphide deposit that was the subject of
small-scale mining from 1975-1981 by Outokumpu Finland. The project
benefits from a modern drill and exploration database which was
completed by Cambior Inc. from 1996-1999, Cornerstone Capital from
2006-2009 and Toachi from 2016-2019.
Toachi Mining completed a PEA estimating an
inferred resource of 1.85 million tonnes grading 4.10 grams gold
per tonne, 50.0 grams silver per tonne, 3.30% copper, 4.60% zinc
and 0.60% lead per tonne.
The La Plata project consists two concessions
covering a total area of 2,235 hectares along its 4-kilometer
length, which contains known mineralization in two VMS lenses and
nine priority exploration targets.
Qualified Person
Mr. Thomas Kelly (SME Registered Member
1696580), advisor to the Company and a qualified person under
National Instrument 43-101 standards, is responsible for ensuring
that the technical information contained in this news release is an
accurate summary of the original reports and data provided to or
developed by Atico.
About Atico Mining
Corporation
Atico is a growth-oriented Company, focused on
exploring, developing and mining copper and gold projects in Latin
America. The Company generates significant cash flow through the
operation of the El Roble mine and is developing it’s high-grade La
Plata VMS project in Ecuador. The Company is also pursuing
additional acquisition of advanced stage opportunities. For more
information, please visit www.aticomining.com.
ON BEHALF OF THE BOARD
Fernando E. GanozaCEOAtico Mining
Corporation
Trading symbols: TSX.V: ATY | OTCQX: ATCMF
Investor RelationsIgor DutinaTel:
+1.604.633.9022
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.
No securities regulatory authority has either
approved or disapproved of the contents of this news release. The
securities being offered have not been, and will not be, registered
under the United States Securities Act of 1933, as amended (the
‘‘U.S. Securities Act’’), or any state securities laws, and may not
be offered or sold in the United States, or to, or for the account
or benefit of, a "U.S. person" (as defined in Regulation S of the
U.S. Securities Act) unless pursuant to an exemption therefrom.
This press release is for information purposes only and does not
constitute an offer to sell or a solicitation of an offer to buy
any securities of the Company in any jurisdiction.
Cautionary Note Regarding Forward
Looking Statements
This announcement includes certain
“forward-looking statements” within the meaning of Canadian
securities legislation. All statements, other than statements of
historical fact, included herein, without limitation the use of net
proceeds, are forward-looking statements. Forward- looking
statements involve various risks and uncertainties and are based on
certain factors and assumptions. There can be no assurance that
such statements will prove to be accurate, and actual results and
future events could differ materially from those anticipated in
such statements. Important factors that could cause actual results
to differ materially from the Company’s expectations include
uncertainties as to the timing and process for renewal of title to
the El Roble claims; uncertainties relating to interpretation of
drill results and the geology, continuity and grade of mineral
deposits; uncertainty of estimates of capital and operating costs;
the need to obtain additional financing to maintain its interest in
and/or explore and develop the Company’s mineral projects;
uncertainty of meeting anticipated program milestones for the
Company’s mineral projects; the world-wide economic and social
impact of COVID-19 is managed and the duration and extent of the
coronavirus pandemic is minimized or not long-term; disruptions
related to the COVID-19 pandemic or other health and safety issues,
or the responses of governments, communities, the Company and
others to such pandemic or other issues; and other risks and
uncertainties disclosed under the heading “Risk Factors” in the
Company's Management's Discussion and Analysis for the year ended
December 31, 2022 as filed on SEDAR and as available on the
Company's website for further details, and in the prospectus of the
Company dated March 2, 2012 filed with the Canadian securities
regulatory authorities on the SEDAR website at www.sedar.com.
Non-GAAP Financial Measures
The items marked with a "(1)" are alternative
performance measures and readers should refer to Non-GAAP Financial
Measures in the Company's Management's Discussion and Analysis for
the three months ended March 31, 2023, as filed on SEDAR and as
available on the Company's website for further details.
_________________________(1) Alternative
performance measures; please refer to “Non-GAAP Financial Measures”
at the end of this release.(2) Net of by-product credits(3) Subject
to adjustments on final settlement
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