FOR: YAMANA GOLD INC.
LSE (AIM) - YAU
TSX SYMBOL: YRI
AMEX SYMBOL: AUY
May 13, 2004
Yamana Reports Profit
TORONTO, ONTARIO--(CCNMatthews - May 13, 2004) -
(all figures in US$ unless otherwise stated)
Yamana Gold Inc. (TSX: YRI; AMEX: AUY; LSE (AIM): YAU) reports net earnings for the fiscal year ended
February 29, 2004 of $1.0 million and for the quarter ended February 29, 2004 of $0.6 million. These
results compare to a loss in the previous year of $3.4 million and a loss in the fourth quarter of the
previous year of $2.1 million. Net earnings per share were $0.02 for the fiscal year, and $0.01 for
the quarter. This compares to a loss of $1.45 per share in the previous year and a loss of $0.03 per
share for the corresponding quarter of the previous fiscal year. Sales for the year were $19.8
million. The per share calculations for fiscal year 2004 and for the quarter ended February 29, 2004
are based on weighted average shares outstanding for the periods of 43.7 million shares and 92.9
million shares respectively.
Profitability for the year is largely underpinned by production and cost control efforts at the
Fazenda Brasileiro mine which was acquired on August 15, 2003. From the time of acquisition to
February 29, 2004 Yamana produced and sold 56,800 ounces and 49,900 ounces of gold respectively. The
difference of 6,900 ounces reflects an expected build up of inventory in the first year of operation.
These ounces were subsequently sold at an average sale price of $406 per ounce. Expenses for the year
include a non-cash expense of $0.6 million for options granted in the period representing $0.014 per
share and non-reoccurring severance charges of $0.72 million representing $0.016 per share.
Cash flow from operations for the fiscal year was $5.6 million representing $0.128 per share. Cash
flow for the quarter was $2.4 million representing $0.026 per share. The cash balance as of February
29, 2004 was $34.6 million. The company has no debt and had a working capital surplus of $35.8 million
as of February 29, 2004.
The complete financial statements for the year end and fourth quarter follow this announcement.
Yamana also announces a change in the year end to December 31st commencing with the current year.
Accordingly, the current year end will be a 10 month period with the first quarter ending on June 30
and the second quarter ending on September 30, 2004.
Yamana produces at an annual rate of over 100,000 ounces gold per year and will generate significant
additional value by bringing its development projects to production.
Yamana is a Canadian gold producer with significant gold production, gold and copper-gold development
stage properties, exploration properties and land positions in all major mineral areas in Brazil.
Yamana expects to produce gold at intermediate company production levels by 2006 in addition to
significant copper production by 2007. Yamana also holds gold exploration properties in Argentina.
Company management plans to build on this base by targeting other gold consolidation opportunities in
Brazil and elsewhere in Latin America.
FORWARD-LOOKING STATEMENTS: This news release contains certain "forward-looking statements" within the
meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended. All
statements, other than statements of historical fact, included in this release, and Yamana's future
plans are forward-looking statements that involve various risks and uncertainties. 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. Forward-looking statements are based on
the estimates and opinions of management on the date the statements are made, and Yamana does not
undertake any obligation to update forward-looking statements should conditions or management's
estimates or opinions change.
FOURTH QUARTER 2003/2004 REPORT
(Based on Canadian GAAP and expressed in U.S. dollars, unless otherwise noted)
Highlights
1. Production for the fourth quarter was 25,944 ounces of gold at an average cash cost of $213 per
ounce. Production for the fiscal year ended February 29, 2004 was 56,794 at an average cash cost of
$216 per ounce. Inventory position at year end was 6,805 ounces of gold.
2. Revenue for the fourth quarter was $10.45 million from the sale of 26,617 ounces of gold. Revenue
for the fiscal year was $19.8 million from the sale of 49,989 ounces of gold.
3. Net earnings for the fourth quarter were $638,855. Net earnings for the fiscal year were
$1,007,646.
4. Cash flow from operations for the fourth quarter was $2.4 million. Cash flow from operations for
the fiscal year end was $5.6 million.
5. Cash on hand as at February 29, 2004 was $34.6 million and the Company had and still has no debt.
6. Production and mine operating earnings were derived from operations at Fazenda Brasileiro since its
acquisition on August 15, 2003. Expenses (below mine operating earnings) are for the full fiscal year
ended February 29, 2004.
Production and Costs
Fourth quarter production consisted of 25,944 ounces of gold at a cash cost of $213 per ounce
produced. A total of 230,905 tonnes were milled during the fourth quarter at an average recovery rate
of 95.3%. In addition, a total of 42,985 tonnes of open pit material was heap leached.
For the twelve month period ending February 29, 2004, Yamana produced 56,794 ounces of gold at an
average cash cost of $216 per ounce. A total of 539,802 tonnes were milled and 109,897 tonnes of open
pit material was heap leached.
Cash costs per ounce of gold produced decreased from third quarter costs of $220 per ounce largely due
to continuing cost cutting measures employed by the Company. Various initiatives have been implemented
since the acquisition of the Fazenda Brasileiro Mine, resulting in cash costs decreasing from
approximately $240 per ounce at the time of acquisition in August 2003 to $216 per ounce for fiscal
year ended February 29, 2004.
Net Earnings
Net earnings for the fourth quarter were $638,855. Sales for the fourth quarter consisted of 26,617
ounces of gold and for the twelve month period ending February 29, 2003 consisted of 49,989 ounces of
gold. Sales for the fourth quarter were $10.45 million. Inventory as at February 29, 2004 was $3.8
million, a decrease from inventory as at November 30, 2003 of $4.8 million. Revenue for the fourth
quarter has been adjusted by $400,000 which was included in third quarter revenues and is now shown as
a reduction in capitalized mineral property expenditures. Taking this adjustment into account, the
average gold sales price realized during the fourth quarter was $407 per ounce sold.
/T/
Reserves
Summary Reserve and Resource Table (1)
Gold M&I Reserve Inferred
Ounces Ounces Ounces
(000s) (000s) (000s)
---------------------------------------------------------------------
Fazenda Brasileiro 324 257 81
Chapada 3,045 2,546 306
Sao Francisco/Sao Vicente 1,411 1,026 900
Fazenda Nova 185 163 2
Cumaru - 540
---------------------------------------------------------------------
Total Ounces 4,965 3,992 1,829
---------------------------------------------------------------------
Summary Reserve and Resource Table (1) (continued)
Copper M&I Reserve Inferred
Pounds Pounds Pounds
(millions) (millions) (millions)
---------------------------------------------------------------------
Chapada 2,809 2,331 300
---------------------------------------------------------------------
(1) Reserve ounces are a subset of M&I ounces. Inferred ounces are in
addition to M&I ounces.
A table providing a breakdown of reserves and resources is
attached.
/T/
As at February 29, 2004, Fazenda Brasileiro had proven and probable reserves containing 256,500 ounces
of gold. The previous owner of Fazenda Brasileiro estimated that proven and probable reserves at the
mine contained 233,900 ounces of gold at the time of acquisition. This means the Company replaced
ounces mined of 56,794 ounces and added an additional 22,600 ounces for a total of 79,394 ounces gold.
Total reserves and resources (excluding inferred resources) as at February 29, 2004 were 324,000
ounces of gold. When inferred resources are taken into account the mine life at Fazenda Brasileiro is
expected to be at least four years, without the benefit of additional exploration efforts that are now
underway.
Proven and probable reserves for Sao Francisco/Sao Vicente project contain 1,026,000 ounces of gold.
Bulk sample testing during the year suggests that drilling may be underestimating the grade and the
Company is currently re-evaluating reserves and resources at Sao Francisco.
Proven and probable reserves for Fazenda Nova are 163,000 ounces of gold. The mine life of Fazenda
Nova is currently over 4 years.
Proven and probable reserves for Chapada are over 2,546,000 ounces of gold and 2.33 billion pounds of
contained copper as at February 29, 2004. The current mine life for the Chapada project is expected to
be 25 years.
Reserve and resource estimates are calculated in accordance with National Instrument 43-101 issued by
the Canadian Securities Regulatory Authorities.
Future Outlook
The long-term plan of the Company includes reaching an annual production level of 400,000 ounces of
gold per year by 2007 plus over 100 million pounds of annual copper production.
During the short year ending December 2004 (10 months), it is estimated that the Company will produce
approximately 90,000 ounces of gold at a cash cost of approximately $210 per ounce.
The Company plans to pursue further mining and exploration opportunities in the mining industry. The
Company intends to move swiftly to become a major Brazilian gold producer and explorer and believes
that the new Brazilian properties, together with further acquisitions in Latin America, will give the
Company the critical mass necessary to become a mid-tier global gold producer with good exploration
prospects.
Development Projects Update
Construction of the Fazenda Nova mine is in progress. The current mine plan contemplates production of
143,000 ounces of gold over a period in excess of four years. Estimated construction costs are
approximately $6.6 million and capital requirements for the construction will be funded from the
Company's existing cash resources. Leaching is expected to commence during the second half of the
current fiscal year with initial gold recovery to occur by year end.
It is also anticipated that construction of the Sao Francisco and Chapada projects will commence
during 2004. Capital costs are estimated to be approximately $35 million for Sao Francisco and $153
million for Chapada. Capital costs at Chapada assume throughput of 12.7 million tonnes per year. The
Company is completing tests for the optimization of the grinding circuit which could result in a
higher projected annual throughput. The Company is also considering a mine plan for Sao Francisco
which would not require it to purchase its own mine fleet. This would significantly reduce capital
costs and initial indications are that operating costs under a contract mining scenario would not
change. The Company is in discussions with a mine fleet owner for contracting services. The Sao
Francisco project is to be funded by existing cash funds and from cash flow from operations. It is
planned that the Chapada project will be funded with $90 million in debt and the balance from other
sources. The Company believes it has cash on hand and access to funds to fully fund its development
projects including Chapada.
Exploration Update
Yamana plans to spend approximately $9.2 million on exploration in 2004. The major portions of this
will be spent on regional and mine site exploration in the Fazenda Brasileiro and Sao Francisco
regions.
Yamana controls about 880,000 hectares of exploration and mining rights. Exploration studies in the
near-mine area of Fazenda Brasileiro, aided by new structural analyses, have outlined four high
priority targets. All four areas, which previously yielded some gold from shallow open pits, will be
explored at depth beginning in the third quarter of the current fiscal year, ending December 31, 2004.
Prospects have also been defined in the regional area of the Fazenda Brasileiro mine through recent
trenching. Drilling is expected to commence in the second quarter of the current fiscal year. Surface
work will continue on remaining parts of the property.
Exploration activity currently underway at Sao Francisco is designed primarily to expand and upgrade
the higher grade gold zone beneath the area of the planned open pit. The program consists of a 15,000
metre in-fill and step-out core drilling program. Completion is expected in the second quarter of the
current fiscal year. The Santa Gold Belt region, which includes the Sao Francisco and adjacent Sao
Vicente properties, has promising gold targets already defined by previous but limited exploration
efforts. A re-examination of the region is planned to begin in the fall of 2004.
Key Statistics
(Based on Canadian GAAP and expressed in U.S. dollars, unless otherwise noted)
/T/
For the three months ended For the twelve months ended
(Unaudited) (Audited)
Feb. 29, 2004 Feb. 28, 2003 Feb. 29, 2004 Feb. 28, 2003
---------------------------------------------------------------------
Operating
Results
Gold production
(ounces) 25,944 - 56,794 -
Gold sold
(ounces) 26,617 - 49,989 -
Per ounce date:
Average realized
gold price $ 407 $ - $ 396 $ -
Cash costs per
ounce produced $ 213 $ - $ 216 $ -
Financial Results
(thousands)
Gold sales $ 10,453 $ - $ 19,811 $ -
Net earnings
(loss) $ 639 $ (2,094) $ 1,008 $ (3,392)
Operating cash
flow $ 2,411 $ (54) $ 5,591 $ (802)
Per share data:
Net earnings $ 0.01 $ (0.03) $ 0.02 $ (1.45)
Operating cash
flow $ 0.026 $ (0.001) $ 0.128 $ (0.341)
Weighted average
number of common
shares
(thousands) 92,870 65,374 43,674 2,347
Key Statistics (continued)
Financial Position (thousands) Feb. 29, 2004 Feb. 28, 2003
---------------------------------------------------------------------
Cash and cash equivalents $ 34,603 $ 722
Working capital $ 35,803 $ (372)
Shareholders' equity $ 81,261 $ 3,770
/T/
Non-GAAP Measures
The Company has included cost per ounce information data because it understands that certain investors
use this information to determine the Company's ability to generate earnings as cash flow for use in
investing and other activities. The Company believes that conventional measures of performance
prepared in accordance with Canadian GAAP do not fully illustrate the ability of its operating mine to
generate cash flow. Non-GAAP measures do not have any standardized meaning prescribed under Canadian
GAAP, and therefore they may not be comparable to similar measures employed by other companies. The
data are intended to provide additional information and should not be considered in isolation or as a
substitute for measures of performance prepared in accordance with Canadian GAAP. The measures are not
necessarily indicative of operating profit or cash flow from operations as determined under Canadian
GAAP. Where cost per ounce data is computed by dividing GAAP operating cost components by ounces sold,
the Company has not provided formal reconciliations of these statistics. Where GAAP operating costs
are adjusted in computing cost per ounce data, the Company has provided reconciliations below.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Except for statements of historical fact relating to the company, certain information contained herein
constitutes forward-looking statements. Forward-looking statements are frequently characterized by
words such as "plan," "expect," "project," "intend," "believe," "anticipate" and other similar words,
or statements that certain events or conditions "may" or "will" occur. Forward-looking statements are
based on the opinions and estimates of management at the date the statements are made, and are subject
to a variety of risks and uncertainties and other factors that could cause actual events or results to
differ materially from those projected in 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 ecological data, fluctuating metal prices, the
possibility of project cost overruns or unanticipated costs and expenses, uncertainties relating to
the availability and costs of financing needed in the future and other factors. The Company undertakes
no obligation to update forward-looking statements if circumstances or management's estimates or
opinions should change. The reader is cautioned not to place undue reliance on forward-looking
statements.
/T/
Reserves and Resources Feb 29, 2004 Yr End
Mineral Reserves Report (Proven and Probable)
Proven Probable
Mineral Reserves Mineral Reserves
---------------------------------------------------------------------
Tonnes Grade Contained Tonnes Grade Contained
MINE (000's) (g/t) oz. (000's) (000's) (g/t) oz. (000's)
---------------------------------------------------------------------
Gold
Fazenda
Brasileiro 1,618 3.130 163 904 3.220 94
---------------------------------------------------------------------
Chapada 17,634 0.319 181 292,872 0.251 2,365
---------------------------------------------------------------------
Sao Francisco - - - 43,381 0.620 865
Sao Vicente - - - 5,220 0.960 161
---------------------------------------------------------------------
Fazenda Nova - - - 5,713 0.888 163
---------------------------------------------------------------------
19,252 0.556 344 348,090 0.326 3,648
---------------------------------------------------------------------
Contained Contained
Tonnes Grade lbs Tonnes Grade lbs
MINE (000's) (%) (millions) (000's) (%) (millions)
---------------------------------------------------------------------
Copper
Chapada 17,634 0.416 162 292,872 0.336 2,169
---------------------------------------------------------------------
TOTAL
Proven and Probable
---------------------------------------------------------------------
Tonnes Grade Contained
MINE (000's) (g/t) oz. (000's)
---------------------------------------------------------------------
Gold
Fazenda
Brasileiro 2,522 3.160 257
---------------------------------------------------------------------
Chapada 310,506 0.255 2,546
---------------------------------------------------------------------
Sao Francisco 43,381 0.620 865
Sao Vicente 5,220 0.960 161
---------------------------------------------------------------------
Fazenda Nova 5,713 0.888 163
---------------------------------------------------------------------
367,342 0.338 3,992
---------------------------------------------------------------------
Contained
Tonnes Grade lbs
MINE (000's) (%) (millions)
---------------------------------------------------------------------
Copper
Chapada 310,506 0.340 2,331
---------------------------------------------------------------------
Reserves and Resources Feb 29, 2004 Yr End (Continued)
Mineral Resources Report (Measured, Indicated and Inferred)
(including reserves as outlined above)
Measured Indicated
Mineral Resources Mineral Resources
---------------------------------------------------------------------
Tonnes Grade Contained Tonnes Grade Contained
MINE (000's) (g/t) oz. (000's) (000's) (g/t) oz. (000's)
---------------------------------------------------------------------
Gold
Fazenda
Brasileiro 2,522 3.160 257 462 4.480 67
---------------------------------------------------------------------
Chapada 25,200 0.300 243 396,200 0.220 2,802
---------------------------------------------------------------------
Sao Francisco - - - 64,647 0.601 1,250
Sao Vicente - - - 5,220 0.960 161
---------------------------------------------------------------------
Fazenda Nova - - - 6,780 0.850 185
---------------------------------------------------------------------
27,722 0.561 500 473,309 0.293 4,465
---------------------------------------------------------------------
Contained Contained
MINE (000's) (%) (millions) (000's) (%) (millions)
---------------------------------------------------------------------
Copper
Chapada 25,200 0.340 189 396,200 0.300 2,620
---------------------------------------------------------------------
Total Inferred
Measured and Indicated Mineral Resources
---------------------------------------------------------------------
Tonnes Grade Contained Tonnes Grade Contained
MINE (000's) (g/t) oz. (000's) (000's) (g/t) oz. (000's)
---------------------------------------------------------------------
Gold
Fazenda
Brasileiro 2,984 3.380 324 489 0.515 81
---------------------------------------------------------------------
Chapada 421,400 0.225 3,045 68,000 0.140 306
---------------------------------------------------------------------
Sao Francisco 64,647 0.601 1,250 34,860 0.538 603
Sao Vicente 5,220 0.960 161 11,400 0.810 297
---------------------------------------------------------------------
Fazenda Nova 6,780 0.850 185 95 0.500 2
---------------------------------------------------------------------
501,031 0.308 4,965 114,844 0.349 1,289
---------------------------------------------------------------------
---------------------------------------------------------------------
Contained Contained
(000's) (%) (millions) (000's) (%) (millions)
---------------------------------------------------------------------
Copper
Chapada 421,400 0.302 2,809 68,000 0.200 300
---------------------------------------------------------------------
/T/
Mineral Reserves and Resources
Chapada inferred resources are from IMC's report dated February 2004. Micon International Limited in a
NI 43-101 compliant technical report dated July 2003 calculated a higher level of inferred resources
at 250.87 million tonnes at 0.252% Cu and 0.152 g/t Au (1.4 billion lbs Cu and 1.2 million oz Au). The
Cumaru/Gradaus Project reportedly has a resource containing 540,000 ounces of gold at a grade of 4.81
g/t. The resource information is taken from a 1996 report published by the CPRM, the national
geological survey of Brazil. This resource may not be in compliance with NI 43-101 and as the Company
has not performed additional evaluation work since acquiring this property, the resource has been
excluded from the resource table, subject to further investigation/evaluation by the Company.
Mineral reserve and resource estimates presented were prepared by or under the supervision of external
consultants as indicated in the table below in accordance with NI 43-101. Reserves and resources have
been determined assuming a gold price of $325 per ounce and a copper price of $0.85 per pound, except
for Fazenda Nova reserves and resources which have assumed a gold price of $345 per ounce. In
estimating the mineral reserves and mineral resources, such persons made assumptions, and used
parameters and methods appropriate for each property, and verified the data disclosed, including
sampling, analytical and test data underlying such estimates. These external reserve reports have been
reviewed by Mel Klohn, VP Exploration as "qualified person", as that term is defined in NI 43-101.
These figures are estimates, however, and no assurance can be given that the indicated amounts of
quantities of gold will be produced. Gold price fluctuations may render mineral reserves containing
relatively lower grades of gold mineralization uneconomic. Moreover, short-term operating factors
relating to the mineral reserves could affect the Company's profitability in any particular accounting
period. The corporation is not aware of any environmental, permitting, legal, title, taxation, socio-
political, marketing or other relevant issues which may materially affect the Corporation's mineral
reserve and resource estimates, other than factors discussed above and in "Risks and Uncertainties" in
the Management Discussion and Analysis section of the annual report.
/T/
Mineral Reserves Mineral Resources Date Report
Fazenda Juan Luis Cespedes Juan Luis Cespedes Feb-04 Estimate
Brasileiro Goycochea, Goycochea, of
Geologist, Geologist, Mineral
Geostatistician Geostatistician Reserves
Chapada Cespedes & Cia Ltd. Cespedes & Cia Ltd. Feb-04 Technical
Independent Independent Mining Report
Mining Consultants Consultants Inc.
Inc.
Sao Watts, Griffis Watts, Griffis Jul-03 Preliminary
Francisco and McOuat Limited and McOuat Limited Feasibility
Study
Sao Watts, Griffis Watts, Griffis Jul-03 Preliminary
Vicente and McOuat Limited and McOuat Limited Feasibility
Study
Fazenda Kappes, Cassiday & Kappes, Cassiday & Nov-03 Feasibility
Nova Associates Associates Study
YAMANA GOLD INC.
CONSOLIDATED BALANCE SHEETS
Prepared by management
(In U.S. dollars)
February 29, 2004 February 28, 2003
---------------------------------------------------------------------
(Audited) (Audited)
ASSETS
Current
Cash and cash equivalents $ 34,603,464 $ 722,344
Accounts receivable 1,370,107 216,330
Inventory (Note 3) 3,847,604 -
Advances and deposits 894,283 39,940
Income taxes recoverable 117,689 -
---------------------------------------------------------------------
40,833,147 978,614
Capital
Property, plant and
equipment (Note 4) 18,236,905 443,067
Mineral properties (Note 5) 34,878,009 5,199,125
---------------------------------------------------------------------
$ 93,948,061 $ 6,620,806
---------------------------------------------------------------------
---------------------------------------------------------------------
LIABILITIES
Current
Accounts payable and accrued
liabilities $ 5,029,744 $ 747,123
Accrued liabilities payable in stock - 603,311
---------------------------------------------------------------------
5,029,744 1,350,434
Long Term
Asset retirement obligation 4,943,208 -
Future income tax liabilities 2,714,021 1,500,357
---------------------------------------------------------------------
12,686,973 2,850,791
---------------------------------------------------------------------
---------------------------------------------------------------------
SHAREHOLDERS' EQUITY
Capital stock
Authorized
Unlimited number of first preference
shares without par value issuable
in series
Unlimited number of common shares
without par value
Issued and outstanding
95,060,749 common shares (Note 6)
(2003 - 2,910,501 shares) 74,426,764 3,515,544
Shares to be issued - 1,285,913
Share purchase warrants and other 9,354,257 2,459,147
Deficit (2,519,933) (3,490,589)
---------------------------------------------------------------------
81,261,088 3,770,015
---------------------------------------------------------------------
$ 93,948,061 $ 6,620,806
---------------------------------------------------------------------
---------------------------------------------------------------------
YAMANA GOLD INC.
CONSOLIDATED STATEMENTS
OF OPERATIONS AND DEFICIT
Prepared by management
(In U.S. dollars)
Three months ended Twelve months ended
(Unaudited) (Audited)
February 29, February 28, February 29, February 28,
2004 2003 2004 2003
SALES $ 10,452,701 $ - $ 19,811,377 $ -
COST OF SALES (6,335,589) - (10,916,729) -
DEPRECIATION,
AMORTIZATION
AND DEPLETION (1,302,893) - (2,429,895) -
ACCRETION OF ASSET
RETIREMENT
OBLIGATION (162,204) - (162,204) -
---------------------------------------------------------------------
MINE OPERATING
EARNINGS 2,652,015 - 6,302,549 -
EXPENSES
General and
administrative 1,310,860 484,382 3,431,735 1,387,486
General
exploration 2,598 28,096 6,034 48,819
Mineral property
and other asset
write-offs 1,980 719,885 75,720 894,304
Stock-based
compensation 226,820 - 611,820 -
Foreign exchange
loss (gain) 663,466 14,246 (157,168) -
Severance costs 6,003 - 715,818 20,851
---------------------------------------------------------------------
OPERATING EARNINGS
(LOSS) 440,288 (1,246,609) 1,618,590 (2,351,460)
Investment and
other
business income 289,091 50,031 482,830 157,907
Interest and
financing (expense)
recovery 2,488 119,884 (255,393) (180,905)
---------------------------------------------------------------------
EARNINGS (LOSS)
BEFORE TAX 731,867 (1,076,694) 1,846,027 (2,374,458)
INCOME TAX EXPENSE (93,012) (1,017,491) (838,381) (1,017,491)
---------------------------------------------------------------------
NET EARNINGS (LOSS) 638,855 (2,094,185) 1,007,646 (3,391,949)
DEFICIT,
BEGINNING
OF THE PERIOD (3,158,788) (1,371,744) (3,490,589) (52,644,546)
---------------------------------------------------------------------
(2,519,933) (3,465,929) (2,482,943) (56,036,495)
INTEREST ON
CONVERTIBLE NOTES - (24,660) (36,990) (98,640)
REDECUTION IN DEFICIT - - - 52,644,546
---------------------------------------------------------------------
DEFICIT, END
OF THE
PERIOD $ (2,519,933) $ (3,490,589) $ (2,519,933) $ (3,490,589)
---------------------------------------------------------------------
---------------------------------------------------------------------
BASIC AND
DILUTED
EARNINGS (LOSS)
PER SHARE $ 0.01 $ (0.03) $ 0.02 $ (1.45)
---------------------------------------------------------------------
---------------------------------------------------------------------
Weighted average
number of Shares
outstanding
(in thousands) 92,870 65,374 43,674 2,347
---------------------------------------------------------------------
---------------------------------------------------------------------
Note: In the opinion of management of Yamana, all adjustments of a
normal recurring nature have been included in these financial
statements to provide a fair statement of results for the periods
presented. The results of those periods are not necessarily
indicative of the results for the full year.
YAMANA GOLD INC.
CONSOLIDATED STATEMENTS
OF CASH FLOWS
Prepared by management
(In U.S. dollars)
Three months ended Twelve months ended
(Unaudited) (Audited)
February 29, February 28, February 29, February 28,
2004 2003 2004 2003
---------------------------------------------------------------------
OPERATING ACTIVITIES
Net earnings (loss)
for the period $ 638,855 $ (2,094,185) $ 1,007,646 $ (3,391,949)
Items not
involving cash
Services paid in
common shares
(adjustment) (566,147) 25,920 271,838 222,653
Depreciation,
amortization
and
depletion 1,302,893 1,549 2,429,895 9,858
Stock-based
compensation 226,820 20,851 611,820 20,851
Mineral property
and other asset
write-offs - 719,885 73,740 894,304
Future income
taxes 495,301 1,017,491 495,301 1,017,491
Non-cash financing
costs (adjustment) - (119,884) - 180,905
Accretion of asset
retirement
obligation 162,204 - 162,204 -
---------------------------------------------------------------------
2,259,926 (428,373) 5,052,444 (1,045,887)
Net change in
non-cash working
capital 151,127 374,221 538,209 243,566
---------------------------------------------------------------------
2,411,053 (54,152) 5,590,653 (802,321)
---------------------------------------------------------------------
FINANCING ACTIVITIES
Issue of common
shares and
warrants for
cash 21,629,853 945,397 61,105,569 1,554,897
Issue costs (1,487,504) (152,801) (4,756,265) (152,801)
Interest expense
on convertible
notes
(adjustment) 36,990 - - -
---------------------------------------------------------------------
20,179,339 792,596 56,349,304 1,402,096
---------------------------------------------------------------------
INVESTING ACTIVITIES
Business
acquisition of
Brasileiro (932,791) (72,126) (22,097,791) -
Expenditures on
mineral
properties (2,848,310) 13,429 (4,191,240) (72,126)
Acquisition of
property, plant
and equipment (466,075) - (1,769,806) -
Other - - - (18,880)
---------------------------------------------------------------------
(4,247,176) (58,697) (28,058,837) (91,006)
---------------------------------------------------------------------
INCREASE (DECREASE)
IN CASH 18,343,216 679,747 33,881,120 508,769
CASH, BEGINNING
OF THE PERIOD 16,260,248 42,597 722,344 213,575
---------------------------------------------------------------------
CASH, END OF
THE PERIOD $ 34,603,464 $ 722,344 $ 34,603,464 $ 722,344
---------------------------------------------------------------------
---------------------------------------------------------------------
SUPPLEMENTARY
INFORMATION
REGARDING
OTHER NON-CASH
TRANSACTIONS
Financing
Activities
Extinguishment
of loan and
accrued interest
payable on
sale of mineral
properties
and related
assets - - - (3,293,185)
Issue of common
shares on
purchase of
First Preference
Shares - 21,043 - 31,564
Issue of common
shares for
Santa
Elina assets 170,995 - 18,496,380 -
Issue of common
shares for
interest and
principal due
on convertible
notes - 24,660 1,528,920 98,640
Equity component
of convertible notes:
Payment of interest
in common shares - (24,660) (49,320) (98,640)
Payment of principal
in common shares - - (1,479,600) -
Purchase of First
Preference Shares
for common shares - (21,043) - (31,564)
Investing Activities
Sale of mineral
properties and
related assets - - - 3,293,185
Expenditures on
mineral
properties,
net of tax (170,995) - (18,496,380) -
Notes to the Unaudited Interim Consolidated Financial Statements
As at February 29, 2004 and for the twelve months ended
February 29, 2004 and February 28, 2003 (in U.S. dollars)
/T/
1. Basis of presentation
The accompanying interim consolidated financial statements have been prepared in accordance with
accounting principles generally accepted ("GAAP") in Canada. These interim financial statements do not
contain all the information required by generally accepted accounting principles for annual financial
statements and therefore should be read in conjunction with the most recent annual financial
statements of the Company. These financial statements follow the same accounting policies and methods
of their application as the most recent annual financial statements.
Significant new accounting policies
Asset retirement obligation
Effective March 1, 2003, the Company adopted an accounting policy for the recognition and measurement
of reclamation and closure costs. Reclamation and closure costs have been estimated based on the
Company's interpretation of current regulatory requirements. The fair value of the estimated
reclamation and closure expenses for Fazenda Brasileiro and Sao Vicente have been recorded as a
liability on acquisition. Fair value was determined as the net present value of future cash
expenditures upon reclamation and closure. Additional charges to operations on a unit-of-production
basis will be made to fully accrue reclamation and closure expenses over the useful lives of the
operations. The new accounting pronouncement set out in the Canadian Institute of Chartered
Accountants Handbook, Section 3110, Asset Retirement Obligations requires that reclamation and closure
costs be recognized normally when the obligation is incurred and be measured at their fair value.
Under this new standard, the provision for reclamation and restoration costs will be capitalized as
mine development costs and amortized over the useful life of the mine on a unit-of-production basis.
The adoption of this accounting policy has been applied retroactively with no impact on prior years'
deficit and results of operation.
Certain amounts for fiscal 2003 have been reclassified to conform with the current year's
presentation.
On July 30, 2003, the name of the Company was changed to Yamana Gold Inc.
On August 12, 2003, the outstanding common shares then outstanding were consolidated on the basis of
one new common share for 27.86 existing common shares. The share and per share information is
presented as if the consolidation took place March 1, 2002.
Stock-based compensation
The Company accounts for all stock based payments to employees and non-employees using the fair value
based method of accounting. The Company stock option plan includes a stock appreciation right feature
and as such the Company expenses as compensation the fair value of options at the time of the grant.
No adjustment for subsequent changes in the price of the Company's shares is recorded. If and when the
stock options are ultimately exercised, the applicable amounts of additional paid-in capital and
contributed surplus will be transferred to share capital.
2. Business acquisition
Purchase of Mineracao Fazenda Brasileiro S.A. ("Fazenda Brasileiro")
On August 12, 2003, the Company acquired all of the outstanding shares of Fazenda Brasileiro. On
August 15, 2003 Fazenda Brasileiro acquired all of the assets of the Fazenda Brasileiro gold mine
("Brasileiro") from Companhia Vale do Rio Doce for $20,900,000 in cash. Acquisition costs of $1.2
million were incurred by the Company. The acquisition was accounted for using the purchase method with
the results of Brasileiro being included with those of the Company from August 15, 2003.
The allocation of the purchase price is based upon the fair values of the net assets of Brasileiro at
the date of acquisition and is summarized as follows:
/T/
(dollars in thousands)
Purchase price:
Cash $ 20,900
Acquisition costs 1,198
---------------------------------------------------------------------
$ 22,098
---------------------------------------------------------------------
---------------------------------------------------------------------
Net assets acquired:
Inventory $ 2,237
Property, plant and equipment 18,446
Mineral properties 6,728
Asset retirement obligation and other (5,313)
---------------------------------------------------------------------
$ 22,098
---------------------------------------------------------------------
---------------------------------------------------------------------
3. Inventory
February 29, 2004 February 28, 2003
---------------------------------------------------------------------
Metal in circuit $ 155,120 $ -
Ore stockpiles 363,388 -
Dore inventories 1,721,273 -
Materials and supplies 1,607,823 -
-
---------------------------------------------------------------------
$ 3,847,604 $ -
---------------------------------------------------------------------
4. Property, plant and equipment
As at
February 29, 2004 February 28, 2003
---------------------------------------------------------------------
Property plant and
equipment: Fazenda Brasileiro $ 17,050,627 $ -
Other fixed assets 1,186,278 443,067
---------------------------------------------------------------------
$ 18,236,905 $ 443,067
---------------------------------------------------------------------
5. Mineral properties
Mineral properties are comprised as follows:
As at
February 29, 2004 February 28, 2003
---------------------------------------------------------------------
Fazenda Brasileiro (Note 2) $ 9,211,997 $ -
Santa Elina 11,487,010 -
Chapada properties 9,197,438 -
Argentine properties 4,974,957 5,063,290
Other 6,607 135,835
---------------------------------------------------------------------
$ 34,878,009 $ 5,199,125
---------------------------------------------------------------------
6. Capital stock
Common shares issued and outstanding:
Number of
Common Shares Amount
---------------------------------------------------------------------
---------------------------------------------------------------------
Balance as at February 28, 2003 2,910,501 3,515,544
Private placements, net of warrants
and issue costs (ii) 28,780 35,343
Issued on conversion of subscription
receipts (iii) 46,250,000 29,180,836
Public offering (iv) 8,665,000 19,734,056
Payment of accounts payable (v) 842,129 875,149
Exercise of options and share
appreciation rights 25,261 30,554
Issued on purchase of First
Preference Shares (vi) 388,457 1,276,517
Issued on conversion of convertible notes (vii)
Principal 1,027,242 1,479,600
Interest 37,666 49,320
Issued on acquisition of
Santa Elina assets 34,885,713 18,249,845
---------------------------------------------------------------------
Balance as at February 29, 2004 95,060,749 $ 74,426,764
---------------------------------------------------------------------
---------------------------------------------------------------------
/T/
(i) On August 12, 2003, the outstanding number of common shares of the Company were consolidated on
27.86 old common shares for one new post-consolidation common share.
(ii) During the year, Yamana completed the following private placements:
a) 7,178 units at a price of Cdn$4.18 per unit. Each unit consisted of one common share and one common
share purchase warrant exercisable for three years from the closing date at an exercise price of
Cdn$5.57. The Company also issued 718 underwriter's warrants exercisable up to 2 years from the
closing date at an exercise price of Cdn$5.29.
b) 21,602 common shares at a price of Cdn$1.57 per share. In addition, warrants totaling 21,602 and
2,160 broker warrants exercisable for up to four years from the closing date, at an exercise price of
Cdn$2.09 per share, were issued.
(iii) On July 31, 2003, the Company accepted subscriptions for 46,250,000 subscription receipts at a
price of Cdn$1.20 per receipt. Each subscription receipt entitled the holder to exchange the receipt
for one common share and one half of a warrant. One warrant entitles the holder to purchase one common
share for Cdn$1.50 until July 31, 2008. On October 7, 2003 the subscription receipts where exchanged
for 46,250,000 common shares and 23,125,000 warrants. The proceeds of $39.5 million (Cdn$55.5 million)
were recorded as $31.7 million as share capital and $7.8 million share purchase warrants before issue
costs of $2.5 million.
(iv) On December 23, 2003, the Company closed a public offering for 8,665,000 common shares at a price
of Cdn$3.20 per share for aggregate gross proceeds of Cdn$27,728,000 net of Cdn$1,790,966 of issue
costs.
(v) The Company settled various liabilities by the issue of common shares including the issue of
350,000 shares to a director.
(vi) During the year ended February 28, 2003, Yamana agreed to purchase 5,560,000 preference shares
and the rights to dividends in exchange for 388,457 post-consolidation common shares. The preference
shares were purchased for common shares on the basis of 0.046 post-consolidation common shares for
each preference share and one post-consolidation common share for each $2.72 of accrued dividends.
Yamana also agreed to grant a 2% NSR on La Paloma, a Yamana gold property in Santa Cruz province,
Argentina for the surrender of 1,000,000 preference shares. The common shares were issued in April
2003.
Warrants that were originally issued with the preferred shares that were purchased or surrendered were
amended such that the expiration date was extended from February 9, 2004 to December 31, 2004 and the
exercise price was reduced from $4.18 to $3.48 per share.
(vii) In 1998, the Company completed the sale of $4,800,000 principal amount of 8% Senior secured
Convertible Notes (the "Notes") of the Company maturing July 17, 2003. Pursuant to the trust
indenture, the Company issued common shares for principle and interest on maturity of the 8%
convertible notes on maturity.
On July 31, 2003, 5,000,000 options were allocated and issued to management and a consultant at an
exercise price of Cdn$1.67 for a 10 year period. The Company had previously agreed to grant these
options with an exercise price equal to the issue price of the subscription receipts of Cdn$1.20 per
share. To account for this difference in value, the Company entered into subscriptions with employees
of the Company for 808,000 common shares, subject to shareholder approval. The Company has also agreed
to fund the subscription by the employees totaling Cdn$1.35 million. The funding is non-interest
bearing and payable in equal installments over 20 years, maturing July 2023.
The compensation expense is determined using an option-pricing model assuming no dividends are to be
paid, a weighted average volatility of the Company's share price of 35%-40%, an annual risk free
interest rate of 3.0% and expected service lives of 3 years.
7. Segmented information
Yamana considers its business to consist of three geographical segments primarily in Brazil, Argentina
and corporate Canada. Capital assets referred to below consist of land, buildings and equipment, and
mineral properties.
/T/
As at
February 29, 2004 February 28, 2003
---------------------------------------------------------------------
Capital assets
Brazil $ 47,617,222 $ 129,228
Argentina 5,375,410 5,496,847
Corporate 122,281 16,117
---------------------------------------------------------------------
$ 53,114,914 $ 5,642,192
---------------------------------------------------------------------
---------------------------------------------------------------------
8. Related party transactions
Related party transactions, not disclosed elsewhere in these
financial statements, during the twelve month period were as follows:
Twelve months ending
February 29, 2004
---------------------------------------------------------------------
Pursuant to the reimbursement of third party
costs relating to the Company's financing and
property acquisitions incurred by Santa Elina
on behalf of the Company $ 438,000
Legal fees to a law firm that had partners who
are either a director or an officer of the Company $ 295,253
Directors fees and consulting fees to associates thereof $ 117,471
Consulting fees paid to an officer prior to
becoming an officer $ 71,654
---------------------------------------------------------------------
/T/
-30-
FOR FURTHER INFORMATION PLEASE CONTACT:
Yamana Gold Inc.
Peter Marrone
President & Chief Executive Officer
(416) 815-0220
E-mail: investor@yamana.com
OR
Yamana Gold Inc.
Chuck Main
Chief Financial Officer
(416) 945-7354
E-mail: cmain@yamana.com
INDUSTRY: PCS
SUBJECT: ERN
-0-
Yamana Gold Inc
Yamana Gold (LSE:AUY)
과거 데이터 주식 차트
부터 6월(6) 2024 으로 7월(7) 2024
Yamana Gold (LSE:AUY)
과거 데이터 주식 차트
부터 7월(7) 2023 으로 7월(7) 2024
