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Gold Resource Corporation Reports First Quarter Results

 -- Published: Wednesday, 4 May 2016 | Print  | Disqus 

COLORADO SPRINGS, CO--(Marketwired - May 4, 2016) - Gold Resource Corporation (NYSE MKT: GORO) (the "Company") reported production results for the first quarter ended March 31, 2016 of 6,463 ounces of gold and 434,142 ounces of silver, which generated $17.4 million in net revenue for the quarter. Gold Resource Corporation is a gold and silver producer with operations in Oaxaca, Mexico and exploration in Nevada, USA. The Company has returned $108 million to shareholders in monthly dividends since commercial production commenced July 1, 2010, and offers shareholders the option to convert their cash dividends and take delivery in physical gold and silver.

2016 Q1 HIGHLIGHTS

  • $0.8 million net income, or $0.01 per share
  • $17.4 million sales, net
  • $667 total cash cost per ounce AuEq (after by-product credits)
  • 6,463 gold ounces produced
  • 6,215 gold ounces sold
  • 434,142 silver ounces produced
  • 378,794 silver ounces sold
  • $6.4 million adjusted cash flow from mine site operations
  • $0.3 million dividend distributions, or $0.005 per share for quarter

Overview of Q1 2016 Aguila Project Results

Gold Resource Corporation's Aguila Project produced 6,463 ounces of gold and 434,142 ounces of silver at a total cash cost of $667 per precious metal gold equivalent ounce (after by-product credits). Realized average metal price sales during the quarter were $1,199 per ounce gold and $14.38 per ounce silver. The Company recorded net income of $0.8 million, or $0.01 per share. Adjusted cash flow from mine site operations totaled $6.4 million. The Company paid $0.3 million to shareholders in dividends, or $0.005 per share during the quarter. Cash and cash equivalents at quarter end totaled $10.3 million. Realized silver prices decreased 14% compared to the first quarter of 2015.

The Company maintains its 2016 annual production Outlook which targets 26,000 gold ounces and 1,900,000 silver ounces.

The following table summarizes certain information about our mining operations for the three months ended March 31, 2016 and 2015:

     
Production and Sales Statistics
  Three months ended March 31,
  2016 2015
Milled      
 Tonnes Milled (1)  113,145  92,359
 Tonnes Milled per Day (2)  1,301  1,026
Grade      
 Average Gold Grade (g/t)  1.99  3.13
 Average Silver Grade (g/t)  131  287
 Average Copper Grade (%)  0.29  0.42
 Average Lead Grade (%)  1.06  1.46
 Average Zinc Grade (%)  3.43  3.71
Recoveries      
 Average Gold Recovery (%)  89  90
 Average Silver Recovery (%)  91  93
 Average Copper Recovery (%)  74  76
 Average Lead Recovery (%)  70  75
 Average Zinc Recovery (%)  84  81
Mill production (before payable metal deductions) (3)      
 Gold (ozs.)  6,463  8,348
 Silver (ozs.)  434,142  790,300
 Copper (tonnes)  244  293
 Lead (tonnes)  838  1,013
 Zinc (tonnes)  3,261  2,762
Payable metal sold      
 Gold (ozs.)  6,215  8,678
 Silver (ozs.)  378,794  727,315
 Copper (tonnes)  220  277
 Lead (tonnes)  762  920
 Zinc (tonnes)  2,599  2,205
Average metal prices realized (4)      
 Gold ($ per oz.)  1,199  1,203
 Silver ($ per oz.)  14.38  16.74
 Copper ($ per tonne)  4,146  5,532
 Lead ($ per tonne)  1,807  1,731
 Zinc ($ per tonne)  1,717  2,008
Precious metal gold equivalent ounces produced (mill production) (3)      
 Gold Ounces  6,463  8,348
 Gold Equivalent Ounces from Silver  5,206  10,999
 Total Precious Metal Gold Equivalent Ounces  11,669  19,347
Precious metal gold equivalent ounces sold      
 Gold Ounces  6,215  8,678
 Gold Equivalent Ounces from Silver  4,542  10,122
 Total Precious Metal Gold Equivalent Ounces  10,757  18,800
 Total cash cost (before by-product credits) per precious metal gold equivalent ounce sold (including royalties) (5) $1,295 $818
 Total cash cost, after by-product credits, per precious metal gold equivalent ounce sold (including royalties) (5) $667 $416
        
(1) Includes 16,697 tonnes of low-grade stockpile open pit ore.
(2) Based on actual days the mill operated during the year. Note that this includes 195 tonnes attributable to processing a portion of the low-grade stockpile open pit ore.
(3) Mill production represents metal contained in concentrates produced at the mill, which is before payable metal deductions are levied by the buyer of our concentrates. Payable metal deduction quantities are defined in our contracts with the buyer of our concentrates and represent an estimate of metal contained in the concentrates produced at our mill which the buyer cannot recover through the smelting process. There are inherent limitations and differences in the sampling method and assaying of estimated metal contained in concentrates that are shipped, and those contained metal estimates are derived from sampling methods and assaying throughout the mill production process. The Company monitors these differences to ensure that precious metal mill production quantities are materially correct.
(4) Average metal prices realized vary from the market metal prices due to final settlement adjustments from our provisional invoices when they are settled. Our average metal prices realized will therefore differ from the market average metal prices in most cases.
(5) For a reconciliation of this non-GAAP measure to total mine cost of sales, which is the most comparable U.S. GAAP measure, please see Non-GAAP Measures in the Company's most recently filed 10-Q.
   

About GRC:

Gold Resource Corporation is a mining company focused on production and pursuing development of gold and silver projects that feature low operating costs and produce high returns on capital. The Company has 100% interest in six potential high-grade gold and silver properties at its producing Oaxaca, Mexico Mining Unit and exploration properties at its Nevada, USA, Mining Unit. The Company has 54,266,706 shares outstanding, no warrants, no long term debt and has returned $108 million back to shareholders since commercial production commenced July 1, 2010. Gold Resource Corporation offers shareholders the option to convert their cash dividends into physical gold and silver and take delivery. For more information, please visit GRC's website, located at www.Goldresourcecorp.com and read the Company's 10-K for an understanding of the risk factors involved.

Cautionary Statements:

This press release contains forward-looking statements that involve risks and uncertainties. The statements contained in this press release that are not purely historical are forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act. When used in this press release, the words "plan", "target", "anticipate," "believe," "estimate," "intend" and "expect" and similar expressions are intended to identify such forward-looking statements. Such forward-looking statements include, without limitation, the statements regarding Gold Resource Corporation's strategy, future plans for production, future expenses and costs, future liquidity and capital resources, and estimates of mineralized material. All forward-looking statements in this press release are based upon information available to Gold Resource Corporation on the date of this press release, and the company assumes no obligation to update any such forward-looking statements. Forward looking statements involve a number of risks and uncertainties, and there can be no assurance that such statements will prove to be accurate. The Company's actual results could differ materially from those discussed in this press release. In particular, there can be no assurance that production will continue at any specific rate. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in the Company's 10-K filed with the SEC.

See Accompanying Tables

The following information summarizes the results of operations for Gold Resource Corporation for the three months ended March 31, 2016 and 2015, its financial condition at March 31, 2016 and December 31, 2015 and its cash flows for the three months ended March 31, 2016 and 2015. The summary data for the three months ended March 31, 2016 is unaudited; the summary data for the year ended December 31, 2015 is derived from our audited financial statements contained in our annual report on Form 10-K for the year ended December 31, 2015, but do not include the footnotes and other information that is included in the complete financial statements. Readers are urged to review the Company's Form 10-K in its entirety, which can be found on the SEC's website at www.sec.gov.

The calculation of our cash cost per ounce contained in this press release is a non-GAAP financial measure. Please see "Management's Discussion and Analysis and Results of Operations" contained in the Company's most recent Form 10-Q and Form 10-K for a complete discussion and reconciliation of the non-GAAP measures.

  
  
GOLD RESOURCE CORPORATION 
CONDENSED CONSOLIDATED BALANCE SHEETS 
(U.S. dollars in thousands, except share and per share amounts) 
       
  March 31,  December 31, 
  2016  2015 
  (Unaudited)    
ASSETS        
Current assets:        
 Cash and cash equivalents $10,325  $12,822 
 Gold and silver bullion  3,413   2,988 
 Accounts receivable  907   321 
 Inventories  9,318   8,753 
 IVA taxes receivable  1,331   1,332 
 Income tax receivable  3,887   3,794 
 Prepaid expenses and other current assets  2,434   2,608 
  Total current assets  31,615   32,618 
Property, plant and mine development, net  53,073   51,637 
Deferred tax assets  20,494   21,064 
Investments in equity securities  231   231 
Other non-current assets  937   985 
 Total assets $106,350  $106,535 
LIABILITIES AND SHAREHOLDERS' EQUITY        
Current liabilities:        
 Accounts payable $10,901  $11,600 
 Accrued expenses and other current liabilities  2,079   2,140 
 Capital lease obligations  696   842 
 Mining royalty taxes payable  3   230 
 Dividends payable  90   90 
  Total current liabilities  13,769   14,902 
Capital lease obligations  24   - 
Reclamation and remediation liabilities  2,795   2,815 
  Total liabilities  16,588   17,717 
Shareholders' equity:        
 Preferred stock - $0.001 par value, 5,000,000 shares authorized: no shares issued and outstanding  -   - 
 Common stock - $0.001 par value, 100,000,000 shares authorized: 54,603,104 and 54,266,706 shares issued and outstanding, respectively, at March 31, 2016 and December 31, 2015  55   55 
 Additional paid-in capital  96,913   96,766 
 Accumulated deficit  (151)  (948)
 Treasury stock at cost, 336,398 shares  (5,884)  (5,884)
 Accumulated other comprehensive loss  (1,171)  (1,171)
  Total shareholders' equity  89,762   88,818 
  Total liabilities and shareholders' equity $106,350  $106,535 
         
  
  
GOLD RESOURCE CORPORATION 
CONDENSED CONSOLIDATED STATEMENTS OF INCOME 
for the three months ended March 31, 2016 and 2015 
(U.S. dollars in thousands, except share and per share amounts) 
(Unaudited) 
  
      
  Three months ended March 31, 
  2016 2015 
        
Sales, net $17,403 $28,372 
Mine cost of sales:       
 Production costs  11,096  12,934 
 Depreciation and amortization  2,806  1,392 
 Reclamation and remediation  47  23 
  Total mine cost of sales  13,949  14,349 
Mine gross profit  3,454  14,023 
Costs and expenses:       
 General and administrative expenses  2,178  2,731 
 Exploration expenses  504  1,712 
  Total costs and expenses  2,682  4,443 
Operating income  772  9,580 
Other income (expense), net  706  (504)
Income before income taxes  1,478  9,076 
 Provision for income taxes  681  4,023 
Net income $797 $5,053 
Net income per common share:       
 Basic and diluted $0.01 $0.09 
Weighted average shares outstanding:       
 Basic and diluted  54,266,706  54,179,369 
        
  
  
GOLD RESOURCE CORPORATION 
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS 
for the three months ended March 31, 2016 and 2015 
(U.S. dollars in thousands) 
(Unaudited) 
  
       
  Three months ended March 31, 
  2016  2015 
         
Cash flows from operating activities:        
 Net income $797  $5,053 
 Adjustments to reconcile net income to net cash from operating activities:        
  Deferred income taxes  515   6 
  Depreciation, depletion and amortization  2,856   1,457 
  Stock-based compensation  418   1,066 
  Other operating adjustments  (608)  286 
 Changes in operating assets and liabilities:        
  Accounts receivable  (586)  (6,043)
  Inventories  (566)  (724)
  Prepaid expenses and other current assets  394   (24)
  Accounts payable and other accrued liabilities  815   1,046 
  Mining and income taxes payable/receivable  (331)  (1,255)
  Other noncurrent assets  26   - 
 Net cash provided by operating activities  3,730   868 
Cash flows from investing activities:        
  Capital expenditures  (5,687)  (4,937)
  Proceeds from the sale of equity investments  163   - 
  Other investing activities  2   7 
 Net cash used in investing activities  (5,522)  (4,930)
Cash flows from financing activities:        
  Dividends paid  (271)  (1,625)
  Repayment of capital leases  (424)  (372)
 Net cash used in financing activities  (695)  (1,997)
Effect of exchange rate changes on cash and cash equivalents  (10)  (38)
Net decrease in cash and cash equivalents  (2,497)  (6,097)
Cash and cash equivalents at beginning of period  12,822   27,541 
Cash and cash equivalents at end of period $10,325  $21,444 
Supplemental Cash Flow Information        
 Interest expense paid $8  $24 
 Income and mining taxes paid $256  $5,239 
Contact:

Corporate Development
Greg Patterson
303-320-7708
www.Goldresourcecorp.com

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 -- Published: Wednesday, 4 May 2016 | E-Mail  | Print  | Source: GoldSeek.com

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