Pasinex Announces 2021 Financial Results
April 28 2022 - 9:50PM
Pasinex Resources Limited (CSE: PSE) (FSE: PNX) (The “Company” or
“Pasinex”) today reports the Company’s financial and operating
results for year ended December 31, 2021.
Andrew Gottwald, Chief Financial Officer of
Pasinex, commented, “The results included within our annual reports
released today demonstrate what can be accomplished through
continued perseverance. The past few years have been difficult for
management and the Company’s shareholders. The recent results and
cash inflows from the joint venture should provide some confidence
that Pasinex has turned a corner and will experience continued
success at the Pinargozu mine and shareholders can look forward to
receiving initial results of work begun in Nevada. Again,
management thanks its shareholders for standing by the
Company.”
Highlights – Year Ended December 31,
2021
Table 1 - Selected Quarterly Consolidated
Information |
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|
|
|
|
|
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Year Ended December 31, |
|
|
2021 |
|
|
|
2020 |
|
|
|
2019 |
|
Financial: |
|
|
|
Equity gain from Horzum AS |
$ |
200,062 |
|
|
$ |
3,298 |
|
|
$ |
672,139 |
|
Dividend received from investment in Horzum AS |
$ |
200,062 |
|
|
$ |
3,298 |
|
|
$ |
672,139 |
|
Consolidated net loss for the year |
$ |
(129,678 |
) |
|
$ |
(1,252,426 |
) |
|
$ |
(1,032,850 |
) |
Basic and diluted net loss per share |
$ |
- |
|
|
$ |
(0.01 |
) |
|
$ |
(0.01 |
) |
Cash used in operating activities |
$ |
480,034 |
|
|
$ |
826,390 |
|
|
$ |
292,330 |
|
Weighted average shares outstanding |
|
144,554,371 |
|
|
|
144,554,371 |
|
|
|
144,415,192 |
|
|
|
|
|
|
Year Ended December 31, |
|
|
2021 |
|
|
|
2020 |
|
|
|
2019 |
|
Horzum AS operational data (100% basis): |
|
|
|
Zinc product mined (wet) tonnes |
|
10,608 |
|
|
|
12,123 |
|
|
|
17,812 |
|
Zinc product sold (wet) tonnes |
|
8,620 |
|
|
|
11,248 |
|
|
|
11,248 |
|
Zinc product sold average grade |
|
37 |
% |
|
|
31 |
% |
|
|
32 |
% |
Gross margin (1) |
|
50 |
% |
|
|
13 |
% |
|
|
34 |
% |
CAD cost per tonne mined (1) |
$ |
383 |
|
|
$ |
313 |
|
|
$ |
436 |
|
USD cash cost per pound of zinc product mined (1) |
$ |
0.36 |
|
|
$ |
0.37 |
|
|
$ |
0.42 |
|
(1) Refer to Non-GAAP Measures
Financial and Operational
- For the year ended December 31,
2021, Pasinex incurred a net loss of approximately $0.13 million,
compared with a net loss of approximately $1.25 million for 2020.
The primary reasons for the substantial decrease in the net loss
were the recovery of amounts due from Horzum AS by Pasinex Arama
and a reduction in general and administrative costs, which was
partially offset by an increase in share-based payments
expense.
- The operating income in Horzum AS
increased to $3.66 million in 2021 from $0.6 million in 2020. This
increase was due to higher revenue generated from higher sales
prices. The increased sales prices were the result of higher
worldwide zinc prices in 2021 along with selling a greater
proportion of high-grade zinc sulphide product in 2021 compared
with 2020. The higher sales prices also resulted in the gross
margin (see non-GAAP measures) for the year ended December 31,
2021, increasing to 50% from 13% in 2020.
- Horzum AS received approval to
begin mining zinc sulphide product from the Fourth Adit during the
third quarter of 2021. Sales of zinc sulphide product in the fourth
quarter of 2021 that was mined from the Fourth Adit resulted in
average sales prices of approximately US$1,270 per tonne. The
average grade achieved for these sales was approximately 53%
zinc.
- Horzum AS sold approximately 2,500
tonnes of zinc sulphide product in the first quarter of 2022 at an
average grade of 53% zinc and an average sale price of
approximately US$1,209 per tonne.
- Subsequent to December 31, 2021,
Pasinex Arama received approximately TRY 26.66 million ($2.31
million using the exchange rates on the dates of the various
transfers from Horzum AS), for amounts owed in dividends and other
receivables. Of this amount approximately TRY 20.35 million ($2.05
million using the exchange rates on the dates of the various
transfers) was transferred from Pasinex Arama to Pasinex Canada.
The previously outstanding 2018 dividend receivable and other
receivables from Horzum AS have now been fully collected by Pasinex
Arama.
- Subsequent to December 31, 2021,
Horzum AS declared an additional dividend to be paid to its
shareholders of TRY 64 million.
- Horzum AS completed a total of
7,557 metres of underground and surface diamond core drilling in
102 holes during 2021. It also completed 1,933 metres of
exploration and development adit development during 2021 including
566 metres of development of the 541-metre level adit (the “Fourth
Adit”).
- Horzum AS had another zero-fatality
year at the Pinargozu Mine. Horzum AS employs approximately 125
people, including those employed by the underground drilling
contractor. In 2021, there were 184,224 fatality free hours worked
at the Pinargozu Mine.
- Pasinex Arama applied to MAPEG, the
Turkish Mining Department, to convert its exploration status
license at its Akkaya property to operational status and for Horzum
AS to convert its pre-exploration status license at the Mahyalar
property to exploration status. Pasinex Arama has been informed
that the Akkaya license application was approved and is expecting
the final receipt of the official license documentation in
2022.
- Subsequent to December 31, 2021,
the Company engaged a contractor to complete a review of its
exploration data on the Company’s Gunman Project. Following this
review, the Company began onsite activities including geophysical
surveys and soil sampling.
- The Company received $580,000 in
2021 ($905,500 in 2020) from shareholder loans.
Pinargozu Operations Update (100% basis)
- Horzum AS mined 10,608 tonnes of
zinc product in 2021, at the Pinargozu mine compared to 12,123
tonnes in 2020. Mine production decreased in 2021 due to limited
available ore product and a focus on the development of the Fourth
Adit. Mined tonnes for the year are below previously issued
guidance for 2021. As a result of the development delays related to
the groundwater in the Fourth Adit and lower production
year-to-date, the Company lowered its annual production estimate in
the second quarter.
- Sales volumes also decreased in
2021 to 8,620 of zinc product, compared with 11,393 in 2020,
primarily as the result of having lower available tonnes to sell as
production was lower. Horzum AS did adopt a process of selling its
zinc product on a more frequent smaller batch basis than in the
past.
- The gross margin, (see non-GAAP
measures), for the year ended December 31, 2021, increased to 50%
compared to 13% in 2020, primarily due to higher zinc prices in
2021 compared with 2020 and selling a greater number of high-grade
zinc sulphide product tonnes in 2021.
- Sales prices per tonne on a USD
basis improved by approximately 75% and 219%, for zinc oxide
product and zinc sulphide product, respectively, between 2021 to
2020. The average USD sales price for the year ended December 31,
2021, was US$480 (2020 – US$275) per tonne for zinc oxide product
and US$1,078 (2020 – US$ 338) per tonne for zinc sulphide
product.
- The average grade of the zinc
sulphide product sold was 49% zinc per tonne for the year ended
December 31, 2021, compared with 48% zinc per tonne in the same
period in 2020.
- The average grade of the zinc oxide
product sold increased to 31% zinc per tonne for the year ended
December 31, 2021, compared with 30% zinc per tonne in the same
period in 2020.
- The CAD cost per tonne mined (see
non-GAAP measures) was $409 and $383 for the three months and year
ended December 31, 2021, compared with $328 and $313 for the same
periods in 2020. The average cost per tonne was higher during 2021
as a result of having mined approximately 12% fewer tonnes in 2021
compared with 2020.
- The USD cash cost per pound of zinc
product mined (see non-GAAP measures) was US$0.29 and US$0.36 per
pound in the three months and year ended December 31, 2021,
respectively, compared with US$0.44 and US$0.37 per pound in the
same periods in 2020.
- Mine production at the Pinargozu
mine has continued on a two-shift basis throughout 2021 and 2020
notwithstanding the negative impacts of the COVID-19 pandemic.
Management expects that it will be able to continue on a two-shift
basis for 2022.
Non-GAAP Measures
Please note that all dollar amounts in this news
release are expressed in Canadian dollars unless otherwise
indicated. Refer also to the 2020 Management’s Discussion and
Analysis (MD&A) and Audited Financial Statements found on
SEDAR.com for more information. This news release includes non-GAAP
measures, including adjusted equity gain from Horzum AS, adjusted
consolidated net income, gross margin, cost per tonne mined and US$
cash cost per pound of zinc mined. A reconciliation of these
non-GAAP measures to the GAAP financial statements is included in
the MD&A.
Qualified Person
Jonathan Challis, a fellow of the Institute of
Materials, Minerals and Mining and a Chartered Engineer, is the
qualified person (“QP”) as defined by NI 43-101, has approved the
scientific and technical disclosure herein. Mr. Challis is a
director of the Company and Chair of Horzum AS.
About Pasinex
Pasinex Resources Limited is a Toronto-based
mining company that owns 50% of Horzum Maden Arama ve Isletme
Anonim Sirketi (“Horzum AS” or “Joint Venture”), through its 100%
owned subsidiary Pasinex Arama ve Madencilik Anonim Sirketi
(“Pasinex Arama”). Horzum AS holds 100% of the producing Pinargozu
high-grade zinc mine. Horzum AS sells directly to zinc smelters and
or refiners through commodity brokers from its mine site in Turkey.
The Company also holds an option to acquire 80% of the Gunman
high-grade zinc exploration project in Nevada. Pasinex has a strong
technical management team with many years of mineral exploration
and mining project development experience. The mission of Pasinex
is to build a mid-tier zinc company based on its mining and
exploration projects in Turkey and Nevada. Visit our website at
www.pasinex.com.
On Behalf of the Board of
Directors PASINEX
RESOURCES LIMITED
“Andrew Gottwald”
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Andrew Gottwald |
Evan White |
Chief Financial Officer |
Manager of Corporate Communications |
Phone: +1 416.861.9659 |
Phone: +1 416.906.3498 |
Email: info@pasinex.com |
Email: evan.white@pasinex.com |
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The CSE does not accept responsibility for the
adequacy or accuracy of this news release.
This news release includes forward-looking
statements that are subject to risks and uncertainties.
Forward-looking statements involve known and unknown risks,
uncertainties, and other factors that could cause the actual
results of the Company to be materially different from the
historical results or any future results expressed or implied by
such forward-looking statements.
All statements within, other than statements of
historical fact, are to be considered forward-looking. Although
Pasinex believes the expectations expressed in such forward-looking
statements are based on reasonable assumptions, such statements are
not a guarantee of future performance, and actual results or
developments may differ materially from those in forward-looking
statements. Factors that could cause actual results to differ
materially from those in forward-looking statements include market
prices, continued availability of capital and financing,
exploration results, and general economic, market or business
conditions. There can be no assurances that such statements will
prove accurate and, therefore, readers are advised to rely on their
own evaluation of such uncertainties. We do not assume any
obligation to update any forward-looking statements.
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