TSX.V: ROK
VANCOUVER, July 29 /PRNewswire-FirstCall/ - Roca Mines Inc. (TSX-V: ROK) ("Roca" or "the Company") has released its financial results for the three and nine months ended May 31, 2010, including production and sales from the MAX Molybdenum mine located in British Columbia, Canada. All dollar amounts are stated in Canadian dollars unless otherwise indicated.
Q3-2010 Highlights
- MAX Molybdenum mine awarded British Columbia's 2009 Mining and
Sustainability Award in April of 2010;
- Government approval of Phase II MAX mine expansion plan to operate at
1,000 tpd;
- Revenues of $13.4 million for September 1, 2009 to May 31, 2010;
- Cash costs of $12.87 per lb (US$12.58) and $12.16 (US$11.62) per lb
of molybdenum produced during the three and nine month periods ended
May 31, 2010 respectively;
- Q1, Q2 and Q3 average molybdenum recoveries of over 95%; and
- Q1, Q2, and Q3 molybdenum in concentrate production of 362,633 lbs,
305,485 lbs and 369,026 lbs respectively.
MAX Molybdenum Mine - Production Results and Concentrate Sales
Revenues of $13.4 million for the nine months ended May 31, 2010 result from shipments during the period and reflect final and/or estimated final pricing at May 31, 2010. The Company sells its concentrates to a UK-based buyer with sales revenues based on average prevailing molybdenum oxide prices subsequent to delivery.
The table below summarizes the average operating statistics for the three months ended May 31, 2010:
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MAX Mine Statistics Q3-2010
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MAR '10 APR '10 MAY '10 TOTAL
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Molybdenum Produced (lbs)(1) 136,910 115,235 116,881 369,026
Average Head Grade (% Mo) 0.41 0.39 0.34
Molybdenum Recovery (%) 96 96 96
Mill Availability (%) 97 99 100
Average Daily Throughput (tpd) 505 461 514
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Note 1: molybdenum contained in concentrate.
The MAX Mine and concentrator continue to operate at targeted Phase I throughput rates with good efficiency and excellent recovery. However, ore produced from the single production area since October of 2009 has returned average head grades that are below targets.
Cash costs of production during the third quarter improved over the second quarter as a result of better throughput and higher grade material received at the mill. Cash costs averaged $12.87 per lb (US$12.58) of molybdenum sold during the third quarter. For the nine months ended May 31, 2010 cash costs averaged Cdn$12.16 (US$11.62) per lb of molybdenum sold.
The grade management challenges encountered over the last three quarters highlight the mine's current dependency on a single producing stope. The development of multiple stopes in the Phase II, 1,000 tpd plan will reduce the impact of the production difficulties encountered during late 2009 and 2010.
Financial Results
The information in this news release and the selected financial information should be read in conjunction with the interim consolidated financial statements, and management discussion and analysis, for the period ended May 31, 2010, which will be available at Roca's website at www.rocamines.com.
During the nine months ended May 31, 2010, the Company recorded production revenues of $13,410,199 and a net loss of $1,884,872. The Company had operating cash flows of $2,285,960 during the same period. The Company reported revenues of $17,162,010 and a loss of $21,460,930 during the nine months ended May 31, 2009 on significantly higher sales of molybdenite concentrates during the prior year (and higher depletion charges under the Phase I mine plan). General and administrative expenses decreased over the prior year reflecting the Company's continuous efforts to reduce costs.
Despite significantly lower molybdenum production during the three months ended May 31, 2010, production revenues increased to $6,277,773 with a net loss of only $11,833. The Company had revenues of $5,584,156 and a loss of $9,610,888 during the three months ended May 31, 2009 on significantly lower realized prices for concentrates in the prior year.
Summary Consolidated Statements of Operations and Loss
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Three months ended Nine months ended
May 31, 2010 May 31, 2010
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Total Revenues 6,277,773 13,410,199
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Operating expenses (4,748,156) (12,611,044)
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Inventory recovery 106,066 106,066
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Depletion, amortization, accretion (499,403) (1,337,956)
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Mining Income (Loss) 1,136,280 (432,735)
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G&A, Stock-based comp., write-offs (931,239) (1,887,889)
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Earnings (Loss) from Operations 205,041 (2,320,624)
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Exchange gain (loss) and
other income (loss) (20,598) (151,759)
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Income and mining tax provision (196,276) 587,511
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Net Loss for the Period (11,833) (1,884,872)
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Loss per Share - Basic and Diluted (0.01) (0.01)
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Outlook
It remains management's belief that global recessionary events have seriously eroded the supply of molybdenum and it contends that a realization of supply and demand fundamentals in the medium-term will result in positive changes to pricing. It is therefore management's goal to advance production at MAX to the 1,000 tpd rate to reduce unit costs and to preserve the opportunity to produce concentrates in an appreciating price environment.
ROCA MINES INC.
"David Skerlec"
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David J. Skerlec - Chief Financial Officer
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 Roca Mines Inc.
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