Copper Mountain announces 2012 year end results
| This release should be read with the unaudited financial statements and management's discussion and analysis available at www.cumtn.com and filed on www.sedar.com. Our financial results are prepared in accordance with IFRS and expressed in Canadian dollars, unless otherwise noted. Sales and production volumes for the Company's 75%-owned Copper Mountain Mine are presented on a 100% basis unless otherwise indicated. |
Web Site: www.CuMtn.com
TSX: CUM
VANCOUVER, March 18, 2013 /PRNewswire/ - Copper Mountain Mining Corporation (TSX: CUM) (the "Company" or "Copper Mountain") announces a gross profit of $38.2 million for the year ended December 31, 2012, an increase of 137% over the prior year.
| Year End 2012 Highlights |
|
Jim O'Rourke, President and CEO of Copper Mountain, remarked "We have been challenged with mill availability and throughput tonnage in the mill for a majority of 2012, but are very pleased to report that our efforts are paying off. Although we ended the year with an 82% availability in the mill for 2012, we have since seen significant improvements in availability as we achieved 93% availability in February 2013. The mill is still challenged to consistently make designed tonnage when receiving only Pit#3 ore as it is very hard, and we are now testing additional explosives to increase fragmentation of the ore and are evaluating the installation of a secondary crusher to pre-crush the ore entering the SAG Mill. In doing so this would allow for a consistent size of finer ore going into the SAG Mill to optimize the operation. Initial estimates indicate that improved fragmentation or pre-crushing would result in ensuring the plant meets the original design capacity with potential for the grinding capacity of the SAG to be increased to the 40,000 tonnes per day range. This expansion would further strengthen the Copper Mountain Mine and ensure that it forms a strong and consistent base for the company's future. "
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1 EBITDA represents earnings before interest, income taxes and depreciation.
2 Adjusted EBITDA removes unrealized gains/losses on derivative instruments and foreign exchange gains/losses
3 Adjusted earnings (loss) and adjusted earnings (loss) per share are non-GAAP financial measures which remove unrealized gains/losses on interest rate swaps and foreign currency gains/losses.
4 Calculated based on weighted average number of shares outstanding under the basic method.
Summary Financial Results
| Three months ended December 31, | Year ended December 31, | ||||
| (CDN$, except for cash cost data in US$) | 2012 $ |
2011 $ |
2012 $ |
2011 $ |
|
| Revenues | 50,086,260 | 44,710,034 | 229,473,610 | 66,531,355 | |
| Gross profit | 6,236,705 | 5,534,826 | 38,220,542 | 16,203,386 | |
| Operating income (loss) | 4,894,106 | 2,807,068 | 31,512,632 | 7,777,193 | |
| Adjusted earnings (loss)5 | 7,415,999 | (1,863,724) | 27,932,610 | 8,613,040 | |
| Earnings (loss) attributable to shareholders of the Company | 2,214,713 | 5,590,703 | 19,776,352 | (12,698,124) | |
| Adjusted earnings per share6 | 0.08 | (0.02) | 0.28 | 0.09 | |
| Earnings per share5 | 0.02 | 0.06 | 0.20 | (0.13) | |
| Cash and cash equivalents | 24,300,790 | 39,094,343 | |||
| Working capital | 11,781,230 | 7,231,869 | |||
| Equity | 244,005,027 | 213,370,648 | |||
| Copper produced (lbs) | 13,780,000 | 12,396,968 | 56,600,000 | 22,127,640 | |
| Gold produced (oz) | 5,800 | 3,834 | 18,900 | 7,799 | |
| Silver produced (oz) | 66,700 | 84,182 | 354,000 | 161,830 | |
| Copper sold (lbs) | 13,185,000 | 11,552,512 | 59,122,000 | 17,363,352 | |
| Gold sold (oz) | 5,200 | 4,372 | 19,900 | 6,466 | |
| Silver sold(oz) | 71,600 | 86,431 | 402,000 | 131,080 | |
| Site cash costs per pound of copper produced (net of gold silver credits) (US$) | 1.77 | 1.11 | 1.83 | 1.26 | |
| Total cash costs per pound of copper sold (net of gold silver credits) (US$) | 2.27 | 1.94 | 2.32 | 1.71 | |
______________________________________
5 Adjusted earnings (loss) and adjusted earnings (loss) per share are non-GAAP financial measures which remove unrealized gains/losses on interest rate swaps and foreign currency gains/losses.
6 Calculated based on weighted average number of shares outstanding under the basic method
Copper Mountain Mine
The Copper Mountain Mine produced 57 million pounds of copper, 18,900 ounces of gold, and 354,000 ounces of silver which generated $229 million in revenue net of pricing adjustments for the year ended December 31, 2012. The total cash cost of copper sold for the year ended December 31, 2012 was US$2.32 per pound of copper after gold and silver by-product credits.
Mining activities continued in the Pit #3 area at the beginning of 2012 with the push-backs on the eastern wall. Part way through the year, the Company relocated two of the production shovels from the Pit#3 area to the Pit #2 area for the commencement of mining activities there. During the year a total of 54.9 million tonnes of material was mined, including 12.5 million tonnes of ore and 42.5 million tonnes of waste during the year, resulting in approximately a 3.4 to 1 waste to ore strip ratio. The mine exited 2012 with an average mining rate of 186,250 tonnes of per day moved during December 2012.
Mill production was adversely affected during the year by greater than expected tailings line wear, failure of the ball mills motor controls, a lack of clear reclaim water in the tailings management facility, and the premature breakage of SAG mill grates. Following the planned mill maintenance shutdowns throughout the year, the Company was able to resolve all of these issues by year end, and in early 2013 the mill achieved for the first time a 93.3% plant availability, compared to a budgeted 92% availability.
However, the mill is still experiencing challenges meeting its tonnage throughput goals as a result of the variability in ore hardness and fragmentation entering the SAG Mill from various open pit locations. Management has engaged an engineering firm to review the option of adding a secondary crusher to pre-crush ore entering the SAG Mill to increase the tonnage throughput. Preliminary designs for this secondary crusher involves ore conveyed from the coarse ore stock pile to the new crushing facility where it would be crushed to 50% minus one inch. Initial estimates indicate the pre-crushing would result in an expansion to the grinding capacity and will ensure the mill meets the original design capacity with potential to increase the grinding capacity of the SAG to the 40,000 tonnes per day range. Preliminary work estimates that the crushing facility would cost approximately $40 million and would be funded out of cash flow or additional debt. It is estimated that the new crushing facility could be in place by the end of the year subject to necessary approval to proceed before the end of April 2013. Concurrent with the secondary crusher evaluation, the mine is testing various blasting techniques to improve fragmentation. To date increased blasting has proven to be positive.
During the year, the Company completed a total of thirteen shipments containing approximately 59.1 million pounds of copper, 19,900 ounces of gold, and 402,000 ounces of silver which generated $229.5 million in revenue net of pricing adjustments. Summarized income statement and balance sheet are provided below.
| Summarized Balance Sheet | |||
| December 31, 2012 |
December 31, 2011 |
||
| Assets | |||
| Current assets | $ 61,633,037 | $ 68,245,867 | |
| Restricted cash | 6,013,726 | - | |
| Deferred tax asset | 2,896,832 | - | |
| Reclamation bonds | 8,200,500 | 4,700,500 | |
| Property, plant and equipment | 510,382,493 | 520,051,062 | |
| Non-current inventory | 26,887,360 | 5,540,890 | |
| $ 616,013,948 | $ 598,538,319 | ||
| Liabilities | |||
| Current liabilities | 49,851,807 | 61,013,998 | |
| Decommissioning and restoration provision | 6,997,883 | 5,152,382 | |
| Interest rate swap liability | 10,980,888 | 10,610,394 | |
| Long-term debt | 304,178,343 | 308,390,897 | |
| 372,008,921 | 385,167,671 | ||
| Equity | |||
| Share capital | 157,942,209 | 157,596,608 | |
| Contributed surplus | 9,469,280 | 6,602,387 | |
| Retained earnings (deficit) | 8,748,474 | (11,027,878) | |
| Non-controlling interest | 176,159,963 | 60,199,531 | |
| Total equity | 244,005,027 | 213,370,648 | |
| $616,013,948 | $598,538,319 | ||
| Summarized Income Statement | |||||||||||||
| Three months ended December 31, |
Year ended December 31, |
||||||||||||
| 2012 $ |
2011 $ |
2012 $ |
2011 $ |
||||||||||
| Revenue | 50,086,260 | 44,710,034 | 229,473,610 | 66,531,355 | |||||||||
| Cost of sales | (43,849,555) | 39,175,208 | (191,253,068) | 50,327,969 | |||||||||
| Gross profit | 6,236,705 | 5,534,826 | 38,220,542 | 16,203,386 | |||||||||
| Other income and expenses | |||||||||||||
| General and administration | (797,283) | 1,686,161 | (4,252,973) | 4,616,051 | |||||||||
| Share based compensation | (545,316) | 1,041,597 | (2,454,937) | 3,810,142 | |||||||||
| Operating income (loss) | 4,894,106 | 2,807,068 | 31,512,632 | 7,777,193 | |||||||||
| Pricing adjustments on concentrate and metal sales | 1,878,416 | (335,286) | 1,641,593 | 5,658,400 | |||||||||
| Finance income | 314,886 | (490,823) | 1,571,489 | (1,344,735) | |||||||||
| Finance expense | (2,316,055) | 5,496,901 | (8,388,716) | 6,167,288 | |||||||||
| Deferred income and resource tax recovery | 2,896,832 | - | 2,896,832 | - | |||||||||
| Current resource tax expense | (252,186) | - | (1,301,220) | 6,167,288 | |||||||||
| Adjusted earnings (loss)(1) | 7,415,999 | (1,863,724) | 27,932,610 | 8,613,040 | |||||||||
| Pricing adjustments on concentrate and metal sales | (1,878,416) | (335,286) | (1,641,593) | (5,658,400) | |||||||||
| Unrealized loss (gain) on interest rate swap | (394,705) | 1,209,340 | (3,654,594) | (9,351,657) | |||||||||
| Loss (gain) on foreign exchange | (2,745,112) | 9,088,280 | 4,785,462 | (8,282,454) | |||||||||
| Net income (loss) and comprehensive income (loss) for the period | 2,397,776 | 8,098,610 | 27,421,885 | (14,679,471) | |||||||||
| Net income (loss) and comprehensive income (loss) attributable to: | |||||||||||||
| Shareholders of the Company | 2,214,713 | 5,590,703 | 19,776,352 | (12,698,124) | |||||||||
| Non-controlling interest | 183,053 | 2,507,907 | 7,645,533 | (1,981,347) | |||||||||
| 2,397,776 | 8,098,610 | 27,421,885 | (14,679,471) | ||||||||||
| Earnings (loss) per share | 0.02 | 0.06 | 0.20 | (0.13) | |||||||||
| Adjusted earnings (loss) per share | 0.07 | (0.02) | 0.28 | 0.09 | |||||||||
| Weighted average shares outstanding | 98,519,596 | 98,421,909 | 98,519,596 | 97,347,637 | |||||||||
| Shares outstanding at end of period | 98,570,927 | 98,466,877 | 98,570,927 | 98,466,877 | |||||||||
| (1) Adjusted earnings (loss) is a non-GAAP financial measure which removes unrealized gains/losses on derivative instruments, changes in fair/value of financial instruments, foreign currency gains/losses and non-recurring transactions |
The full set of financial statements and accompanying MD&A are posted on Sedar.com.
| Copper Mountain will host a conference call on Monday, March 18, 2013 at 10:30 a.m. Eastern Time (7:30 a.m. Pacific) to discuss these results. The conference call may be accessed by dialing: Live Dial-in information Vancouver and international: (416) 764-8609 North America (toll-free): (888) 390-0605 To participate in the webcast live via your computer go to: : http://www.newswire.ca/en/webcast/detail/1128023/1230361 Replay call information Vancouver and international:416-764-8677, passcode 616516 North America (toll-free): 1-888-390-0541, passcode 616516 The conference call replay will be available from 10:30 am (PST) on March 18, 2013, until 11:59 pm PST on March 26, 2013 Participant audio webcast will also be available on the company's website http://www.cumtn.com |
About Copper Mountain Mining Corporation:
Copper Mountain's flagship asset is the 75% owned Copper Mountain mine located in southern British Columbia near the town of Princeton. The Company has a strategic alliance with Mitsubishi Materials Corporation who owns the remaining 25%. The Copper Mountain mine commenced production in the summer of 2011, and has continued to improve its operations during the year; and attained design capacity in the summer of 2012. The 18,000 acre site has a resource of approximately 5 billion pounds of copper and remains open laterally and at depth. The mine has significant exploration potential that will need to be explored over the next few years to fully appreciate the properties full development potential. Additional information is available on the Company's web page at www.CuMtn.com.
On behalf of the Board of
COPPER MOUNTAIN MINING CORPORATION
"Rod Shier"
Rodney A. Shier, CA.
Chief Financial Officer
Note: This release contains forward-looking statements that involve risks and uncertainties. These statements may differ materially from actual future events or results. Readers are referred to the documents, filed by the Company on SEDAR at www.sedar.com, specifically the most recent reports which identify important risk factors that could cause actual results to differ from those contained in the forward-looking statements. The Company undertakes no obligation to review or confirm analysts' expectations or estimates or to release publicly any revisions to any forward-looking statement.
SOURCE Copper Mountain Mining Corporation
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