Dundee Precious Metals Inc. (TSX: DPM) (“DPM” or
the “Company”) today announced its operating and financial results
for the fourth quarter and twelve months ended December 31, 2022.
Highlights
(Unless otherwise stated, all monetary figures
in this news release are expressed in U.S. dollars, and all
operational and financial information contained in this news
release is related to continuing operations.)
-
Metals production: Produced 273,109 ounces of
gold, in line with 2022 guidance and 30.8 million pounds of copper,
slightly below 2022 guidance.
-
Complex concentrate smelted: Throughput of 174,122
tonnes at Tsumeb, slightly below 2022 guidance.
-
All-in sustaining cost: Reported cost of sales per
ounce of gold sold1 of $975, and an all-in sustaining cost per
ounce of gold sold2 of $885, within the range of guidance for
2022.
-
Free cash flow: Generated $232.1 million of cash
from operating activities and $166.4 million of free cash
flow2.
-
Adjusted net earnings: Reported net earnings
attributable to common shareholders from continuing operations of
$35.9 million ($0.19 per share) and adjusted net earnings2 of
$129.0 million ($0.68 per share).
-
Financial position: Ended the year with a strong
balance sheet, including $433.2 million of cash, a $150.0 million
undrawn revolving credit facility, and no debt.
-
Returning capital to shareholders: Returned $44.1
million, or 27% of 2022 free cash flow, to shareholders through
dividends and share repurchases. Declared fourth quarter dividend
of $0.04 per common share payable on April 17, 2023 to shareholders
of record on March 31, 2023.
-
Enhanced Normal Course Issuer Bid (“NCIB”): DPM’s
Board of Directors has approved the renewal of its NCIB, pending
Toronto Stock Exchange (“TSX”) approval, for the purchase of up to
$100 million of the Company’s outstanding common shares, subject to
certain internal parameters.
-
Strong sustainability performance: Scored in the
91st percentile among metals and mining companies in the 2022
S&P Global Corporate Sustainability Assessment and was included
in The Sustainability Yearbook for the second consecutive
year.
-
Ada Tepe life of mine (“LOM”) plan: Updated
mineral reserve and mineral resource estimate and optimized LOM
plan for Ada Tepe with higher annual production, improved average
grade and higher gold recoveries.
-
Improved 2023 guidance and three-year outlook:
Gold production expected to average 270,000 ounces over the next
three years, with higher forecasted production in 2023 and 2024;
improved all-in sustaining cost profile; declining sustaining
capital expenditures; and consistent smelter performance.
-
Development projects: DPM has taken the decision
to extend the timeline for the optimization phase of the updated
feasibility study (“FS”) for Loma Larga in Ecuador, which is now
expected to be completed in the second half of 2023.
-
Exploration: High-grade discovery at the Čoka
Rakita exploration prospect in Serbia where DPM is expecting
additional results from drilling in the second quarter and
targeting an initial Mineral Resource estimate in the fourth
quarter of 2023. Continued exploration work at Tierras Coloradas in
Ecuador and advanced brownfield exploration at Chelopech and Ada
Tepe.
_______________1 Cost of sales per ounce of
gold sold represents total cost of sales for Chelopech and Ada
Tepe, divided by total payable gold in concentrate sold. This
measure is before treatment charges, freight and by-product
credits, all of which are reflected in revenue, while all-in
sustaining cost per ounce of gold sold is net of these
items.2 All-in sustaining cost per ounce of gold sold, free
cash flow, and adjusted net earnings are non-GAAP financial
measures or ratios. These measures have no standardized meanings
under International Financial Reporting Standards (“IFRS”) and may
not be comparable to similar measures presented by other companies.
Refer to the “Non-GAAP Financial Measures” section commencing on
page 17 of this news release for more information, including
reconciliations to IFRS measures.
CEO Commentary
“In 2022, we delivered strong operating results,
achieving our gold production guidance while managing industry cost
pressures. We generated $166 million of free cash flow in 2022, of
which we returned 27% to shareholders through share repurchases and
our sustainable quarterly dividend. We also continued to invest in
our future, as we progressed the feasibility study update at Loma
Larga and announced a high-grade discovery at Čoka Rakita in
Serbia,” said David Rae, President and Chief Executive Officer.
“Our strong three-year outlook for gold
production and attractive all-in sustaining costs, reflecting the
improved life of mine plan for Ada Tepe, combined with our
financial strength and significant free cash flow generation
position us well to continue generating value for all of our
stakeholders.
“Our focus in 2023 will be on continuing to
deliver strong operating performance, achieving key milestones at
Loma Larga, and advancing our portfolio of prospective exploration
targets.”
Use of non-GAAP Financial
Measures
Certain financial measures referred to in this
news release are not measures recognized under IFRS and are
referred to as non-GAAP financial measures or ratios. These
measures have no standardized meanings under IFRS and may not be
comparable to similar measures presented by other companies. The
definitions established and calculations performed by DPM are based
on management’s reasonable judgment and are consistently applied.
These measures are intended to provide additional information and
should not be considered in isolation or as a substitute for
measures prepared in accordance with IFRS. Non-GAAP financial
measures and ratios, together with other financial measures
calculated in accordance with IFRS, are considered to be important
factors that assist investors in assessing the Company’s
performance.
The Company uses the following non-GAAP
financial measures and ratios in this news release:
- mine cash cost
- cash cost per tonne of ore
processed
- mine cash cost of sales
- cash cost per ounce of gold
sold
- all-in sustaining cost
- all-in sustaining cost per ounce of
gold sold
- smelter cash cost
- cash cost per tonne of complex
concentrate smelted
- adjusted earnings before interest,
taxes, depreciation and amortization (“EBITDA”)
- adjusted net earnings
- adjusted basic earnings per
share
- cash provided from operating
activities, before changes in working capital
- free cash flow
- average realized metal prices
For a detailed description of each of the
non-GAAP financial measures and ratios used in this news release
and a detailed reconciliation to the most directly comparable
measure under IFRS, please refer to the “Non-GAAP Financial
Measures” section commencing on page 17 of this news release.
Key Operating and Financial Highlights
$ millions, except where noted |
|
Three Months |
|
|
Twelve Months |
|
Ended December 31, |
|
2022 |
2021 |
Change |
|
|
2022 |
2021 |
Change |
|
Operating Highlights |
|
|
|
|
|
|
|
|
Metals contained in
concentrate produced: |
|
|
|
|
|
|
|
|
Gold |
|
|
|
|
|
|
|
|
Chelopech |
oz |
45,339 |
49,050 |
(8 |
%) |
|
179,135 |
177,001 |
1 |
% |
Ada Tepe |
oz |
28,081 |
33,774 |
(17 |
%) |
|
93,974 |
132,964 |
(29 |
%) |
Total gold in concentrate
produced |
oz |
73,420 |
82,824 |
(11 |
%) |
|
273,109 |
309,965 |
(12 |
%) |
Copper |
Klbs |
7,436 |
9,151 |
(19 |
%) |
|
30,835 |
34,688 |
(11 |
%) |
Payable metals in concentrate
sold: |
|
|
|
|
|
|
|
|
Gold |
|
|
|
|
|
|
|
|
Chelopech |
oz |
39,203 |
40,538 |
(3 |
%) |
|
151,580 |
149,297 |
2 |
% |
Ada Tepe |
oz |
26,628 |
33,282 |
(20 |
%) |
|
91,117 |
129,754 |
(30 |
%) |
Total payable gold in
concentrate sold |
oz |
65,831 |
73,820 |
(11 |
%) |
|
242,697 |
279,051 |
(13 |
%) |
Copper |
Klbs |
6,726 |
8,175 |
(18 |
%) |
|
27,224 |
32,680 |
(17 |
%) |
Cost of sales per tonne of ore
processed(1): |
|
|
|
|
|
|
|
|
Chelopech |
$/t |
71 |
60 |
18 |
% |
|
63 |
59 |
7 |
% |
Ada Tepe |
$/t |
125 |
123 |
2 |
% |
|
120 |
115 |
5 |
% |
Cash cost per tonne of ore
processed(2): |
|
|
|
|
|
|
|
|
Chelopech |
$/t |
51 |
54 |
(6 |
%) |
|
50 |
47 |
6 |
% |
Ada Tepe |
$/t |
58 |
60 |
(3 |
%) |
|
55 |
52 |
6 |
% |
Cost of sales per ounce of
gold sold(3) |
$/oz |
990 |
819 |
21 |
% |
|
975 |
819 |
19 |
% |
All-in sustaining cost per
ounce of gold sold(2) |
$/oz |
1,008 |
757 |
33 |
% |
|
885 |
657 |
35 |
% |
Complex concentrate
smelted |
t |
41,835 |
51,932 |
(19 |
%) |
|
174,122 |
189,705 |
(8 |
%) |
Cost of sales per tonne of
complex concentrate smelted(4) |
$/t |
621 |
646 |
(4 |
%) |
|
694 |
678 |
2 |
% |
Cash
cost per tonne of complex concentrate smelted(2) |
$/t |
443 |
447 |
(1 |
%) |
|
463 |
480 |
(3 |
%) |
Financial Highlights |
|
|
|
|
|
|
|
|
Revenue |
|
152.9 |
166.4 |
(8 |
%) |
|
569.8 |
641.4 |
(11 |
%) |
Cost of sales |
|
91.1 |
94.1 |
(3 |
%) |
|
357.4 |
357.1 |
- |
% |
Impairment charge |
|
- |
- |
- |
% |
|
85.0 |
- |
100 |
% |
Earnings before income taxes |
|
37.6 |
60.3 |
(38 |
%) |
|
58.7 |
229.4 |
(74 |
%) |
Net earnings attributable to
common shareholders from continuing operations |
|
33.3 |
52.1 |
(36 |
%) |
|
35.9 |
190.7 |
(81 |
%) |
Per share |
|
0.18 |
0.27 |
(33 |
%) |
|
0.19 |
1.02 |
(81 |
%) |
Net earnings attributable to
common shareholders(5) |
|
33.3 |
51.5 |
(35 |
%) |
|
35.9 |
210.1 |
(83 |
%) |
Per share(5) |
|
0.18 |
0.27 |
(33 |
%) |
|
0.19 |
1.12 |
(83 |
%) |
Adjusted EBITDA(2) |
|
58.3 |
84.3 |
(31 |
%) |
|
252.9 |
336.9 |
(25 |
%) |
Adjusted net earnings(2) |
|
33.3 |
51.4 |
(35 |
%) |
|
129.0 |
202.0 |
(36 |
%) |
Per share(2) |
|
0.18 |
0.27 |
(33 |
%) |
|
0.68 |
1.09 |
(38 |
%) |
Cash provided from operating
activities |
|
49.3 |
88.9 |
(45 |
%) |
|
232.1 |
253.5 |
(8 |
%) |
Free cash flow(2) |
|
33.3 |
65.8 |
(49 |
%) |
|
166.4 |
252.4 |
(34 |
%) |
Capital expenditures incurred: |
|
|
|
|
|
|
|
|
Growth(6) |
|
11.2 |
7.4 |
50 |
% |
|
32.4 |
17.1 |
90 |
% |
Sustaining(7) |
|
16.7 |
12.3 |
35 |
% |
|
58.2 |
52.5 |
11 |
% |
Total capital expenditures |
|
27.9 |
19.7 |
41 |
% |
|
90.6 |
69.6 |
30 |
% |
|
|
|
|
|
|
|
|
|
|
|
1) Cost of sales per tonne of ore processed
represents cost of sales for Chelopech and Ada Tepe, respectively,
divided by tonnes of ore processed. 2) Cash cost per tonne of
ore processed, all-in sustaining cost per ounce of gold sold, cash
cost per tonne of complex concentrate smelted, adjusted EBITDA,
adjusted net earnings, adjusted basic earnings per share and free
cash flow are non-GAAP financial measures or ratios. Refer to the
“Non-GAAP Financial Measures” section commencing on page 17 of this
news release for more information, including reconciliations to
IFRS measures.3) Cost of sales per ounce of gold sold
represents total cost of sales for Chelopech and Ada Tepe, divided
by total payable gold in concentrate sold. 4) Cost of sales
per tonne of complex concentrate smelted represents cost of sales
for Tsumeb, divided by tonnes of complex concentrate smelted.
5) These measures include discontinued operations for the
twelve months of 2021.6) Growth capital expenditures are
generally defined as capital expenditures that expand existing
capacity, increase life of assets and/or increase future earnings.
This measure is used by management and investors to assess the
extent of discretionary capital spending being undertaken by the
Company each period.7) Sustaining capital expenditures are
generally defined as expenditures that support the ongoing
operation of the asset or business without any associated increase
in capacity, life of assets or future earnings. This measure is
used by management and investors to assess the extent of
non-discretionary capital spending being incurred by the Company
each period.
Performance Highlights
A table comparing production, delivery and cash
cost measures by asset for the fourth quarter and twelve months of
2022 against 2022 guidance is located on page 14 of this news
release.
The Company’s mining operations continued to
deliver strong operating results and despite inflationary cost
pressures, the Company achieved an all-in sustaining cost per ounce
of gold sold within the guidance range for the year.
Chelopech, Bulgaria: Chelopech
continued its track record of strong performance, producing 45,339
ounces of gold and 7.4 million pounds of copper in the fourth
quarter. In 2022, Chelopech produced 179,135 ounces of gold,
achieving its annual guidance for gold, and 30.8 million pounds of
copper which was 3% below the low end of the guidance range.
All-in sustaining cost per ounce of gold sold in
the fourth quarter of 2022 was $1,253. For 2022, all-in sustaining
cost per ounce of gold sold was $957, 6% above the high end of the
guidance range for the year, reflecting lower by-product credits as
a result of lower volumes of copper sold, higher freight charges,
the local inflationary environment and higher cash outlays for
sustaining capital, partially offset by a stronger U.S. dollar.
Ada Tepe, Bulgaria: Ada Tepe
delivered its highest quarterly production in the fourth quarter of
2022, producing 28,081 ounces of gold. Following the completion of
a pushback in the third quarter, gold grades increased as planned
and the operation is well positioned for higher grades in 2023, as
per the mine plan. Annual production of 93,974 ounces of gold was
at the higher end of its guidance range for the year. In January
2023, the Company released an updated Mineral Reserve and Mineral
Resource estimate and LOM plan for Ada Tepe, which reflects a 22%
increase in recovered gold ounces, a 13% increase in average gold
grade and a 1% increase in recovery, compared to the previous LOM
plan.3 The additional estimated production from Ada Tepe has been
reflected in the Company’s improved three-year outlook.
All-in sustaining cost per ounce of gold sold in
the fourth quarter of 2022 was $648. For 2022, all-in sustaining
cost per ounce of gold sold in 2022 was $765, which was 13% below
the low end of its guidance range for the year, reflecting a
stronger U.S. dollar and higher than expected volume of gold
sold.
Tsumeb, Namibia: Performance
during the fourth quarter of 2022 at the Tsumeb smelter was
impacted by a 17-day shutdown to repair a water leak in the off-gas
system as well as instability in the power grid as a result of
abnormally heavy rainfall in December. As a result, complex
concentrate smelted for the year of 174,122 tonnes was 6% below the
low end of its 2022 guidance range.
Cash cost per tonne of complex concentrate
smelted in the fourth quarter was $443. In 2022, cash cost per
tonne of complex concentrate smelted of $463 was towards the higher
end of the updated guidance range, due primarily to the fixed cost
nature of the facility and the impact of lower volumes of complex
concentrate smelted, partially offset by a stronger U.S.
dollar.
_______________3 For more information regarding
the Mineral Reserve and Mineral Resource estimate and updated LOM
plan for Ada Tepe, refer to the news release dated January 12,
2023, available on our website at www.dundeeprecious.com and SEDAR
at www.sedar.com.
Consolidated Operating Highlights
Production: Gold contained in
concentrate produced in the fourth quarter and twelve months of
2022 of 73,420 ounces and 273,109 ounces, respectively, was 11% and
12% lower than the corresponding periods in 2021 due primarily to
mining in lower grade zones at Ada Tepe, partially offset by higher
gold recoveries at Chelopech, in line with the mine plans for both
operations.
Copper production in the fourth quarter and
twelve months of 2022 of 7.4 million pounds and 30.8 million
pounds, respectively, was 19% and 11% lower than the corresponding
periods in 2021 due primarily to lower copper grades.
Deliveries: Payable gold in
concentrate sold in the fourth quarter and twelve months of 2022 of
65,831 ounces and 242,697 ounces, respectively, was 11% and 13%
lower than the corresponding periods in 2021 primarily reflecting
lower gold production. Payable copper in concentrate sold in the
fourth quarter and twelve months of 2022 of 6.7 million pounds and
27.2 million pounds, respectively, was 18% and 17% lower than the
corresponding periods in 2021 due primarily to lower copper
production.
Complex concentrate: Complex
concentrate smelted during the fourth quarter of 2022 of 41,835
tonnes was 19% lower than the corresponding period in 2021 due
primarily to the 17-day shutdown and instability in the power grid,
as described above. Complex concentrate smelted during 2022 of
174,122 tonnes was 8% lower than 2021 due primarily to unplanned
downtime as a result of maintenance to the off-gas and baghouse
systems during the year, partially mitigated by near record-level
quarterly production in the third quarter of 2022.
Cost measures: Cost of sales in
the fourth quarter of 2022 of $91.1 million was 3% lower than the
corresponding period in 2021 due primarily to a stronger U.S.
dollar, partially offset by higher local currency mine operating
expenses in Bulgaria. Cost of sales in 2022 of $357.4 million was
comparable to 2021 due primarily to a stronger U.S. dollar largely
offset by higher local currency mine operating expenses in Bulgaria
and higher depreciation.
All-in sustaining cost per ounce of gold sold in
the fourth quarter of 2022 of $1,008 was 33% higher than the
corresponding period in 2021 due primarily to higher local currency
operating expenses reflecting the local inflationary environment,
lower by-product credits as a result of lower volumes of copper
sold, and lower volumes of gold sold, partially offset by a
stronger U.S. dollar. All-in sustaining cost per ounce of gold sold
in 2022 of $885 was 35% higher than 2021 due primarily to lower
volumes of gold sold, lower by-product credits, higher freight
charges and higher local currency operating expenses, partially
offset by a stronger U.S. dollar.
Cash cost per tonne of complex concentrate
smelted in the fourth quarter and twelve months of 2022 of $443 and
$463, respectively, was comparable to the corresponding periods in
2021 due primarily to higher sulphuric acid by-product credits and
lower labour costs related to the cost optimization initiative
undertaken in 2022, partially offset by lower volumes of complex
concentrate smelted and higher inflationary local currency
operating expenses.
Consolidated Financial Highlights
Revenue: Revenue during the
fourth quarter and twelve months of 2022 of $152.9 million and
$569.8 million, respectively, was 8% and 11% lower than the
corresponding periods in 2021 due primarily to lower volumes of
gold and copper sold.
Net earnings: Net earnings
attributable to common shareholders from continuing operations in
the fourth quarter of 2022 were $33.3 million ($0.18 per share)
compared to $52.1 million ($0.27 per share) in the corresponding
period in 2021, due primarily to lower volumes of metal sold.
Net earnings attributable to common shareholders
from continuing operations in 2022 were $35.9 million ($0.19 per
share) compared to $190.7 million ($1.02 per share) in 2021, due
primarily to an impairment charge of $85.0 million in respect of
Tsumeb, as well as lower volumes of metal sold, partially offset by
a stronger U.S. dollar.
Adjusted net earnings: Adjusted
net earnings in the fourth quarter and twelve months of 2022 were
$33.3 million ($0.18 per share) and $129.0 million ($0.68 per
share), respectively, compared to $51.4 million ($0.27 per share)
and $202.0 million ($1.09 per share) in the corresponding periods
in 2021 due primarily to the same factors affecting net earnings
attributable to common shareholders from continuing operations,
with the exception of the adjusting items primarily related to the
Tsumeb impairment charge.
Earnings before income taxes:
Earning before income taxes in the fourth quarter and twelve months
of 2022 was $37.6 million and $58.7 million, respectively, compared
to $60.3 million and $229.4 million in the corresponding periods in
2021. These changes reflect the same factors that affected net
earnings attributable to common shareholders from continuing
operations, except for income tax, which is excluded.
Adjusted EBITDA: Adjusted
EBTIDA in the fourth quarter and twelve months of 2022 was $58.3
million and $252.9 million, respectively, compared to $84.3 million
and $336.9 million in the corresponding periods in 2021, reflecting
the same factors that affected adjusted net earnings, except for
interest, income tax, depreciation and amortization, which are
excluded from adjusted EBITDA.
Cash provided from operating
activities: Cash provided from operating activities in the
fourth quarter and twelve months of 2022 of $49.3 million and
$232.1 million, respectively, was 45% and 8% lower than the
corresponding periods in 2021, due primarily to the same factors
impacting earnings before income taxes, excluding a non-cash
impairment charge in respect of Tsumeb, as well as timing of
deliveries and subsequent receipt of cash.
For a detailed discussion on the factors
affecting cash provided from operating activities, refer to the
“Liquidity and Capital Resources” section contained in the
Management’s Discussion and Analysis for the three and twelve
months ended December 31, 2022 (the “MD&A”).
Free cash flow: Free cash flow
in the fourth quarter and twelve months of 2022 of $33.3 million
and $166.4 million, respectively, was 49% and 34% lower than the
corresponding periods in 2021, due primarily to the same factors
impacting earnings before income taxes, excluding the non-cash
impairment charge in respect of Tsumeb.
Capital expenditures: Capital
expenditures incurred during the fourth quarter and twelve months
of 2022 were $27.9 million and $90.6 million, respectively,
compared to $19.7 million and $69.6 million in the corresponding
periods in 2021.
Sustaining capital expenditures incurred during
the fourth quarter and twelve months of 2022 of $16.7 million and
$58.2 million, respectively, were comparable to the corresponding
periods in 2021 of $12.3 million and $52.5 million.
Growth capital incurred during the fourth
quarter and twelve months of 2022 were $11.2 million and $32.4
million, respectively, compared to $7.4 million and $17.1 million
in the corresponding periods in 2021, due primarily to activities
related to the development of the Loma Larga and Timok gold
projects
Balance Sheet Strength and Financial
Flexibility
The Company continues to maintain a strong
financial position, with a growing cash position, no debt and a
$150 million revolving credit facility which remains undrawn.
For the twelve months ended December 31, 2022,
cash increased by $98.8 million to $433.2 million, due primarily to
earnings generated in the period as well as a favourable period
over period change in working capital primarily related to timing
of deliveries and subsequent receipt of cash, partially offset by
cash outlays for capital expenditures, dividend payments and share
repurchases.
In July 2022, DPM entered into a new four-year
revolving credit facility with a consortium of four banks. The
facility matures in July 2026 and provides more flexibility and
generally more favourable terms and conditions compared with DPM’s
previous revolving credit facility. Under the new facility, DPM is
permitted to borrow up to $150 million, which can be increased up
to $250 million, subject to certain conditions.
Return of Capital to
Shareholders
In line with its disciplined capital allocation
framework, DPM continues to return excess capital to shareholders,
which currently includes a sustainable quarterly dividend and
periodic share repurchases under its normal course issuer bid
(“NCIB”).
During 2022, the Company returned a total of
$44.1 million to shareholders, representing approximately 27% of
its free cash flow generated in the year. This included the
repurchase of 2,471,500 shares at an average price of $5.51
(Cdn$7.14) per share for a total value of approximately $13.6
million (Cdn$17.6 million), and $30.5 million of dividends
distributed during the year.
Quarterly DividendOn February
16, 2023, the Company’s Board of Directors declared a dividend of
$0.04 per common share payable on April 17, 2023, to shareholders
of record on March 31, 2023.
Enhanced NCIB The Board has
approved the renewal of the NCIB (“New Bid”), subject to approval
by the TSX. If accepted, the New Bid will be made in accordance
with the applicable rules and policies of the TSX and applicable
Canadian securities laws. Pursuant to the New Bid, it is expected
that the Company will be able to purchase up to 16,500,000 common
shares, representing approximately 10% of the public float as of
February 16, 2023, over a period of twelve months commencing after
the TSX approval. The New Bid will also allow the Company to
implement an Issuer Repurchase Agreement and automatic share
repurchase plan with its designated broker in order to facilitate
the purchase of its shares.
Assuming the full number of shares are
repurchased under this New Bid, and at the Company’s current share
price, this represents an authorized return of capital of up to
$100 million. The actual timing and number of common shares that
may be purchased pursuant to the NCIB will be undertaken in
accordance with DPM’s capital allocation framework, having regard
for such things as DPM’s financial position, business outlook and
ongoing capital requirements, as well as its share price and
overall market conditions.
Development Projects Update
Loma Larga, EcuadorDrilling
activities, as well as the Citizens Participation Process for the
Environmental Impact Assessment, remain paused pending the outcome
of the appeals process related to the decision on the
constitutional protective action following the hearing held in
mid-October 2022. The decision on the appeal is expected to provide
clarity on the consultation process and whether an indigenous
consultation could be completed in parallel, as originally planned
by the Company, or would need to be completed prior to resuming the
Citizens Participation Process. The expected timing for receipt of
the environmental licence is subject to the outcome of the appeal
process.
Given the delays in timing for recommencing
drilling activities and further advancing the environmental
permitting process, DPM has taken the decision to extend the
timeline for the optimization phase of the updated FS for Loma
Larga, which is now expected to be completed in the second half of
2023. This will allow DPM time to evaluate additional optimization
opportunities that have been identified to leverage the Company’s
significant operating expertise with similar deposits, in
particular Chelopech in Bulgaria, which shares similar geology,
mining method and processing flow sheet to the Loma Larga project;
and to potentially incorporate the results of the drilling program
supporting the updated FS optimization once DPM is able to
recommence those activities.
Prior to the acquisition, DPM had determined
that the initial capital estimate for the project, prepared by the
previous owner in April 2020, was low. Since then, the Company has
incorporated certain scope changes to the project as part of the
updated FS work, to enhance project execution and meet DPM’s
operating standards. DPM has also seen inflationary pressures
consistent with general industry trends. Combined, these factors
are expected to result in a significant increase to the estimated
capital and operating costs for the project. This may impact
economics and other parameters, including Mineral Resource and
Mineral Reserve estimates, which are being assessed as the
additional work required for the updated FS progresses. DPM views
Loma Larga as a high-quality project with the potential to generate
compelling economic returns following this optimization work.
The Company has progressed discussions with the
government of Ecuador in respect of an investor protection
agreement, which is targeted to be complete by the end of the first
quarter of 2023. In-line with its disciplined approach to project
development, DPM does not anticipate making any significant capital
commitments to the project prior to the completion of the investor
protection agreement and receipt of the environmental licence.
The Company maintains a constructive
relationship with government institutions and other stakeholders
involved with the development of the project. After the
announcement of the local election results, the DPM team welcomed
the newly elected leaders and plans to engage with them in a
proactive manner to build support for the project.
Timok gold project, SerbiaAs
announced in January 20234, given the potential of the new
high-grade discovery at the Čoka Rakita prospect, the Company will
now focus on further exploration at Čoka Rakita in 2023 and as a
result, will pause further work on the Timok
FS.Exploration
At Chelopech, the brownfield
exploration program was focused on an intensive drilling campaign
to support a Commercial Discovery for the Sveta Petka exploration
licence, which is now close to completion and is scheduled for
submission to the Bulgarian authorities during the first quarter of
2023.
At Ada Tepe, exploration
activities were focused on a resource extension drill program and
other satellites on the mine concession, as well as target
delineation campaigns on the Chiirite and Dalbokata Reka
exploration licences. Approximately 9,400 metres were drilled over
47 holes during the year. Results of the drilling activity on the
mine concession provided support for the potential addition of
incremental mineable material in proximity to the pit, and DPM is
assessing if follow-up drilling is required in this area.
In Serbia, drilling at the
Čoka Rakita prospect resumed in the fourth quarter
of 2022 following receipt of a new exploration licence and outlined
potential for a high-grade deposit that remains open in multiple
directions. Results to date are very encouraging, and DPM will
focus on further exploration at Čoka Rakita, including infill and
extension drilling. DPM intends to release additional results from
drilling in the second quarter and is targeting an initial Mineral
Resource estimate in the fourth quarter of 2023.
In Ecuador, DPM completed
approximately 2,700 metres of drilling at the Tierras
Coloradas licence during the fourth quarter of 2022. This
drill program tested the high-grade low sulphidation vein system
which was previously identified in 2020. The change in status of
the Tierras Coloradas project from early to advanced stage
exploration is in progress, and all regulations and authorizations
required from the different Ecuadorian authorities are expected to
be received by early 2024.
_______________4 For more information
regarding the new high-grade discovery at Čoka Rakita, please refer
to the news release dated January 16, 2023, available on our
website at www.dundeeprecious.com and SEDAR at www.sedar.com.
Detailed 2023 Guidance
The following sections of this news release,
under the headings “Detailed 2023 Guidance” and “Three-Year Outlook
(2023 to 2025)”, represent forward-looking information and readers
are cautioned that actual results may vary materially from the
Company’s expectations. Refer to the “Cautionary Note Regarding
Forward Looking Statements” located on page 16 of this news release
and the “Risks and Uncertainties” section of the MD&A issued
February 16, 2023 and available on the Company’s website
(www.dundeeprecious.com) and filed on SEDAR (www.sedar.com).
The Company issued its detailed guidance for
2023, which is set out in the following table:
$ millions, unless otherwise indicated |
Chelopech |
Ada Tepe |
Tsumeb |
Corporateand Other |
ConsolidatedGuidance |
Ore processed |
Kt |
2,090 - 2,200 |
730 - 810 |
- |
- |
2,820 - 3,010 |
Cash cost per tonne of ore
processed(1) |
$/t |
53 - 58 |
73 - 79 |
- |
- |
- |
Metals contained in
concentrate produced(2),(3) |
|
|
|
|
|
|
Gold |
Koz |
150 - 170 |
120 - 145 |
- |
- |
270 - 315 |
Copper |
Mlbs |
30 - 35 |
- |
- |
- |
30 - 35 |
Payable metals in concentrate
sold(3) |
|
|
|
|
|
|
Gold |
Koz |
130 - 150 |
115 - 140 |
- |
- |
245 - 290 |
Copper |
Mlbs |
26 - 31 |
- |
- |
- |
26 - 31 |
All-in sustaining cost per
ounce of gold sold(1),(4) |
$/oz |
700 - 880 |
530 - 630 |
- |
- |
700 - 860 |
Complex concentrate
smelted |
Kt |
- |
- |
200 - 230 |
- |
200 - 230 |
Cash cost per tonne of complex
concentrate smelted(1) |
$/t |
- |
- |
340 - 410 |
- |
340 - 410 |
Corporate general and
administrative expenses(5) |
|
- |
- |
- |
25 - 28 |
25 - 28 |
Exploration expenses(1) |
|
- |
- |
- |
- |
25 - 30 |
Sustaining capital
expenditures(1) |
|
20 - 24 |
10 - 13 |
14 - 17 |
2 - 3 |
46 - 57 |
Growth
and other capital expenditures(1),(6) |
|
2 - 3 |
0 - 1 |
2 - 3 |
18 - 24 |
22 - 31 |
|
|
|
|
|
|
|
1) Based on a Euro/US$ exchange rate of
1.10, a US$/ZAR exchange rate of 17.00, a copper price of $4.00 per
pound and a sulphuric acid price of $95 per tonne, where
applicable.2) Metals contained in concentrate produced are prior to
deductions associated with smelter terms.3) Gold produced includes
gold in pyrite concentrate produced of 45,000 to 51,000 ounces and
payable gold sold includes payable gold in pyrite concentrate sold
of 30,000 to 37,000 ounces. 4) Allocated general and administrative
expenses are reflected in consolidated all-in sustaining cost per
ounce of gold sold; however are not reflected in the all-in
sustaining cost per ounce of gold sold for Chelopech and Ada Tepe,
which is a change from the presentation in the Company’s historical
MD&A given that the nature of such expenses is more reflective
of the Company’s consolidated all-in sustaining cost and not
pertaining to the individual operations of the Company.5) Excludes
share-based compensation expense of approximately $3 million,
before mark-to-market adjustments from movements in the Company’s
share price, given the volatile nature of this expense. This is a
change from the historical approach to the Company's detail
guidance on corporate general and administrative expenses.6) Growth
and other capital expenditures in Corporate and Other include the
estimated running cost for the Loma Larga gold project of $10
million to $14 million and for the Timok gold project of $1 million
to $2 million (as detailed below), as well as a capitalized lease
related to electric mobile equipment of $7 million to $8 million as
part of the Company’s ESG initiatives.
Certain key cost measures in the Company’s
detailed guidance for 2023 are sensitive to market assumptions,
including copper price and foreign exchange rates. The following
table demonstrates the effect of a 10% change in these market
assumptions on all-in sustaining cost and smelter cash cost
provided in the 2023 guidance.
|
2023 assumptions |
Hypothetical change |
All-in sustaining cost
($/oz) |
Smelter cash cost ($/t) |
Copper |
$4.00/lb |
+/- 10% |
+/- $44/oz |
N/A |
Euro/US$ |
1.10 |
+/- 10% |
+/- $92/oz |
N/A |
US$/ZAR |
17.00 |
+/- 10% |
N/A |
- $24/t /+ $40/t (1) |
|
|
|
|
|
1) As at December 31, 2022, approximately 86% of
projected Namibian dollar operating expenses for 2023 have been
hedged with option contracts providing a weighted average floor
rate of 15.69 and a weighted average ceiling rate of 17.69.
Three-Year Outlook (2023 to 2025)
The Company provided its updated three-year outlook, as outlined
in the table below. Highlights of the Company’s updated three-year
outlook include:
-
Maintains strong gold production levels: Over the
next three years, gold production is expected to average
approximately 270,000 ounces per year, based on current mine plans,
with higher forecasted production in 2023 and 2024 compared to the
previous outlook.
-
Stable copper production: Copper production over
the next three years is expected to average approximately 32
million pounds per year, based on current mine plans.
-
Improved all-in sustaining cost: All-in sustaining
cost per ounce of gold sold is expected to range between $700 and
$860 in 2023 and between $720 and $880 for 2024 and 2025, which is
lower than previously expected. This reflects the benefits of
higher expected volumes of gold sold as a result of the updated LOM
plan at Ada Tepe and higher by-product credits reflecting higher
copper prices, partially offset by a weaker U.S. dollar.
-
Consistent smelter performance: The Company is
forecasting complex concentrate smelted to be between 200,000 and
230,000 tonnes in each of the next three years, reflecting its
expectation for a consistent rate of throughput following a plan to
resolve water leak issues by April 2023. Cash cost per tonne of
complex concentrate smelted is expected to trend lower in the next
three years, reflecting the benefit of a consistent throughput
level, as well as estimated cost savings associated with the
ongoing cost optimization initiative which commenced in 2022.
-
Sustaining capital expenditures trending lower:
Sustaining capital expenditures are expected to trend lower over
the next three years, due primarily to the completion of the
upgraded tailings management facility at Chelopech and the gradual
reduction in activities at Ada Tepe as the mine approaches its end
of life in 2026.
The Company’s three-year outlook is set out in the following
table:
$ millions, unless otherwise indicated |
|
2022 Results |
2023 Guidance |
2024Outlook |
2025 Outlook |
Gold contained in concentrate produced(1),(2) |
|
|
|
|
|
Chelopech |
Koz |
179 |
150 - 170 |
160 - 180 |
160 - 185 |
Ada Tepe |
Koz |
94 |
120 - 145 |
85 – 105 |
70 - 85 |
Total |
Koz |
273 |
270 - 315 |
245 – 285 |
230 - 270 |
Copper contained in
concentrate produced(1) |
|
|
|
|
|
Chelopech |
Mlbs |
31 |
30 - 35 |
29 – 34 |
29 - 34 |
All-in sustaining cost per
ounce of gold sold(3) |
$/oz |
885 |
700 – 860 |
720 – 880 |
720 – 880 |
Complex concentrate
smelted |
Kt |
174 |
200 – 230 |
200 – 230 |
200 – 230 |
Cash cost per tonne of complex
concentrate smelted(3) |
$/t |
463 |
340 – 410 |
310 – 360 |
300 – 350 |
Sustaining capital
expenditures(3) |
|
|
|
|
|
Chelopech |
|
23 |
20 – 24 |
14 – 18 |
12 – 15 |
Ada Tepe |
|
10 |
10 – 13 |
10 – 12 |
8 – 10 |
Tsumeb |
|
19 |
14 – 17 |
10 – 13 |
14 – 17 |
Corporate digital initiatives(4) |
|
6 |
2 - 3 |
2 - 3 |
2 - 3 |
Consolidated |
|
58 |
46 - 57 |
36 - 46 |
36 - 45 |
1) Metals contained in concentrate produced
are prior to deductions associated with smelter terms.2) Gold
produced includes gold in pyrite concentrate produced of 45,000 to
51,000 ounces for 2023, and 48,000 to 54,000 ounces in each of 2024
and 2025.3) Based on, where applicable, a Euro/US$ exchange rate of
1.10, a US$/ZAR exchange rate of 17.00, and a copper price of $4.00
per pound for all years, as well as a sulphuric acid price of $95
per tonne in 2023, $94 per tonne in 2024 and $86 per tonne in
2025.4) While corporate sustaining capital expenditures are
primarily related to digital initiatives for all years, 2022
results also included the capitalized lease and leasehold
improvements related to the new head office lease.
The estimated metals contained in concentrate
produced, payable metals in concentrate sold and volumes of complex
concentrate smelted detailed in the Company’s 2023 detailed
guidance and three-year outlook are not expected to occur evenly
throughout the year and are forecasted to vary from quarter to
quarter depending on mine sequencing, the timing of concentrate
deliveries and planned outages, including furnace maintenance
shutdowns at Tsumeb. The rate of capital expenditures is also
expected to vary from quarter to quarter based on the schedule for,
and execution of, each capital project.
Additional detail on the Company’s three-year
outlook is set out below:
Chelopech: Gold and copper
contained in concentrate produced are expected to be consistent
with the production schedules and expected grades outlined in the
most recently issued technical report.5 Gold contained in
concentrate produced remains unchanged from the previous outlook
for 2023 and 2024, with the outlook for 2025 relatively consistent
with 2024 production levels. The outlook for copper contained in
concentrate produced in 2023 and 2024 has been revised from the
previous outlook of between 32 and 39 million pounds for 2023 and
between 30 and 35 million pounds for 2024.
Cash cost per tonne of ore processed is expected
to be higher in 2023 as compared to 2022, primarily reflecting a
stronger Euro relative to the U.S. dollar and the local
inflationary environment.
Sustaining capital expenditures in 2023 are
expected to be in line with 2022 results, reflecting additional
costs related to the upgrade of Chelopech’s tailings management
facility which is expected to be completed in 2023. Sustaining
capital expenditures are expected to trend lower in 2024 and
decline even further in 2025. Growth capital expenditures related
to resource development drilling and margin improvement projects
are expected to be between $2 million and $3 million in 2023,
relatively consistent year over year.
Ada Tepe: Gold contained in
concentrate produced in 2023 and 2024 is expected to be higher than
the previously issued outlook range of 115,000 to 140,000 ounces in
2023, and 69,000 to 83,000 ounces in 2024, reflecting the updated
LOM plan announced in January 2023 which included an increase of
approximately 66,000 ounces of total gold recovered to concentrate
over the LOM.
Cash cost per tonne of ore processed is expected to be higher in
2023 as compared to 2022, primarily reflecting lower volumes of ore
processed, higher royalty payments due to higher contained ounces
mined, a stronger Euro relative to the U.S. dollar and the local
inflationary environment.
Sustaining capital expenditures are expected to
be higher than the previous outlook range of between $9 million and
$10 million in each of 2023 and 2024, as a result of increased
costs related to Ada Tepe’s integrated waste management facility,
before reducing to a range of $8 million to $10 million in
2025.
Tsumeb: The Company is
forecasting complex concentrate smelted to be between 200,000 and
230,000 tonnes in each of 2023, 2024 and 2025, reflecting its
expectation for a consistent rate of throughput following a plan to
resolve water leak issues in the off-gas system by April 2023. Over
90% of concentrate feed is currently contracted through to the end
of 2023, with the remaining feed in 2023 and additional feed
thereafter expected to be contracted in the normal course.
Sustaining capital expenditures are expected to
be between $14 million and $17 million for each of 2023 and 2025,
and between $10 million and $13 million in 2024, reflecting the
timing of scheduled maintenance shutdowns based on an expected
18-month operating cycle for the Ausmelt furnace.
_______________5 Refer to the technical report
“NI 43-101 Mineral Resource and Mineral Reserve Update, Chelopech
Mine- Chelopech, Bulgaria,” dated March 31, 2022, available on our
website at www.dundeeprecious.com and SEDAR at www.sedar.com.
Loma Larga gold project: Growth
capital expenditures for 2023 associated with the Loma Larga gold
project are expected to be between $10 million and $14 million,
which mainly include general and administrative expenses, and costs
related to certain permitting, social and environmental related
activities.
Upon achieving certain milestones for the
project, the Company will increase its guidance for growth capital
expenditures, reflecting additional funding to resume drilling
activities and further advance permitting. The amount and timing of
the spend in respect of this additional funding is dependent on the
timing of achieving the respective milestones in the year.
Timok gold project: As
previously announced, the Company is pausing further work on the
Timok FS to focus on further exploration at Čoka Rakita. As a
result, growth capital expenditures are expected to be
significantly reduced in 2023 to a range of $1 million to $2
million.
Exploration expenses: In 2023,
the Company is increasing its level of spending on exploration,
reflecting higher expected drilling activities following the
discovery of a high-grade deposit at Čoka Rakita in Serbia, and an
advanced brownfield drill program at Chelopech focusing on the
Sveta Petka Commercial Discovery application process as well as
additional drilling at Sharlo Dere. Therefore, expenditures related
to exploration in 2023 are expected to be between $25 million and
$30 million.
Selected Production, Delivery and Cost
Performance versus Guidance
|
|
Q4 2022 |
2022 |
2022ConsolidatedGuidance |
|
Chelopech |
Ada Tepe |
Tsumeb |
Consolidated |
Chelopech |
Ada Tepe |
Tsumeb |
Consolidated |
Ore processed |
Kt |
553 |
206 |
- |
759 |
2,139 |
853 |
- |
2.992 |
2,900 – 3,100 |
Metals
contained in concentrate produced |
|
|
|
|
|
|
|
|
|
|
Gold |
Koz |
45 |
28 |
- |
73 |
179 |
94 |
- |
273 |
250 – 290 |
Copper |
Mlbs |
7 |
- |
- |
7 |
31 |
- |
- |
31 |
32 – 37 |
Payable
metals in concentrate sold |
|
|
|
|
|
|
|
|
|
|
Gold |
Koz |
39 |
27 |
- |
66 |
152 |
91 |
- |
243 |
220 – 255 |
Copper |
Mlbs |
7 |
- |
- |
7 |
27 |
- |
- |
27 |
28 – 32 |
All-in
sustaining cost per ounce of gold sold(1) |
$/oz |
1,253 |
648 |
- |
1,008 |
957 |
765 |
- |
885 |
750 – 890 |
Complex
concentrate smelted(2) |
Kt |
- |
- |
42 |
42 |
- |
- |
174 |
174 |
185 – 200 |
Cash cost per tonne of complex concentrate smelted |
$/t |
- |
- |
443 |
443 |
- |
- |
463 |
463 |
420 – 480 |
|
|
|
|
|
|
|
|
|
|
|
1) All-in sustaining cost per ounce of gold
sold guidance for Chelopech and Ada Tepe was expected to be $740 to
$900 and $770 to $880, respectively.2) Previous 2022 guidance
was 210,000 to 240,000 tonnes.
Fourth Quarter 2022 Results Conference Call and
Webcast
At 9 AM EST on Friday, February 17, 2023, DPM
will host a conference call and audio webcast to discuss the
results, followed by a question-and-answer session. To participate
via conference call, register in advance at the link provided below
to receive the dial-in information as well as a unique PIN code to
access the call.
The call registration and webcast details are as
follows:
Conference call date and time |
Friday, February 17, 20239AM EST |
Call registration |
https://register.vevent.com/register/BI992f7f1b998d4467a27b65f1461c86d7 |
Webcast link |
https://edge.media-server.com/mmc/p/32yqxtvb |
Replay |
Archive will be available on www.dundeeprecious.com |
This news release and DPM’s audited consolidated
financial statements and MD&A for the three and twelve months
December 31, 2022 are posted on the Company’s website at
www.dundeeprecious.com and have been filed on SEDAR at
www.sedar.com.
Qualified Person
The technical and scientific information in this
news release has been prepared in accordance with Canadian
regulatory requirements set out in National Instrument 43-101
Standards of Disclosure for Mineral Projects (“NI 43-101”) of the
Canadian Securities Administrators and the Canadian Institute of
Mining, Metallurgy and Petroleum Definition Standards for Mineral
Resources and Mineral Reserves, and has been reviewed and approved
by Ross Overall, B.Sc. (Applied Geology), Corporate Mineral
Resource Manager of DPM, who is a Qualified Person as defined under
NI 43-101, and who is not independent of the Company.
About Dundee Precious
Metals
Dundee Precious Metals Inc. is a Canadian-based
international gold mining company with operations and projects
located in Bulgaria, Namibia, Ecuador and Serbia. The Company’s
purpose is to unlock resources and generate value to thrive and
grow together. This overall purpose is supported by a foundation of
core values, which guides how the Company conducts its business and
informs a set of complementary strategic pillars and objectives
related to ESG, innovation, optimizing our existing portfolio, and
growth. The Company’s resources are allocated in-line with its
strategy to ensure that DPM delivers value for all of its
stakeholders. DPM’s shares are traded on the Toronto Stock Exchange
(symbol: DPM).
For further information, please contact:
David RaePresident and Chief Executive OfficerTel:
(416) 365-5092drae@dundeeprecious.com |
|
Navin DyalChief Financial OfficerTel: (437)
427-8579navin.dyal@dundeeprecious.com |
|
Jennifer CameronDirector, Investor RelationsTel:
(416) 219-6177jcameron@dundeeprecious.com |
|
|
|
|
|
Cautionary Note Regarding Forward
Looking Statements
This news release contains “forward looking
statements” or “forward looking information” (collectively,
“Forward Looking Statements”) that involve a number of risks and
uncertainties. Forward Looking Statements are statements that are
not historical facts and are generally, but not always, identified
by the use of forward looking terminology such as “plans”,
“expects”, “is expected”, “budget”, “scheduled”, “estimates”,
“forecasts”, “guidance”, “outlook”, “intends”, “anticipates”,
“believes”, or variations of such words and phrases or that state
that certain actions, events or results “may”, “could”, “would”,
“might” or “will” be taken, occur or be achieved, or the negative
of any of these terms or similar expressions. The Forward Looking
Statements in this news release relate to, among other things:
expected cash flows; the price of gold, copper, silver and
sulphuric acid; toll rates, metals exposure and stockpile interest
deductions at Tsumeb; estimated capital costs, all-in sustaining
costs, operating costs and other financial metrics, including those
set out in the outlook and guidance provided by the Company;
currency fluctuations; the processing of Chelopech concentrate;
results of economic studies, including the Loma Larga feasibility
study; expected milestones; timing and success of exploration
activities, including at the Čoka Rakita target; the timing of the
completion and results of an updated feasibility study for the Loma
Larga project; the timing and possible outcome of pending
litigation or legal proceedings, including the timing of the legal
proceedings related to the Action and resumption of drilling
activities at Loma Larga; development of the Loma Larga gold
project, including expected production, successful negotiations of
an investment protection agreement and exploitation agreement and
granting of environmental and construction permits in a timely
manner; success of permitting activities; permitting timelines;
success of investments, including potential acquisitions; measures
the Company is undertaking in response to the COVID-19 outbreak,
including its impacts on the Company’s global supply chains, the
level of and duration of reductions or curtailments in operating
levels at any of the Company’s operations or in its exploration and
development activities; government regulation of mining and
smelting operations; the timing and amount of dividends; the timing
and number of common shares of the Company that may be purchased
pursuant to the NCIB; and the timing and expected benefit of the
recently announced acquisition by B2Gold of Sabina.
Forward Looking Statements are based on certain
key assumptions and the opinions and estimates of management and
Qualified Person (in the case of technical and scientific
information), as of the date such statements are made, and they
involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance or achievements of
the Company to be materially different from any other future
results, performance or achievements expressed or implied by the
Forward Looking Statements. In addition to factors already
discussed in this news release, such factors include, among others:
fluctuations in metal and sulphuric acid prices, toll rates and
foreign exchange rates; risks arising from the current inflationary
environment and the impact on operating costs and other financial
metrics, including the risk that the power subsidy in Bulgaria may
be discontinued; continuation or escalation of the conflict in
Ukraine, including the continued exemption from the Council of
Europe’s sanctions in favour of Bulgaria with respect to the import
of Russian oil and economic sanctions against Russia and Russian
persons which may impact supply chains; risks relating to the
Company’s business generally and the impact of global pandemics,
including COVID-19, resulting in changes to the Company’s supply
chain, product shortages, delivery and shipping issues, closure
and/or failure of plant, equipment or processes to operate as
anticipated, employees and contractors becoming infected, low
vaccination rates, lost work hours and labour force shortages;
regulatory changes, including changes impacting the complex
concentrate market; inability of Tsumeb to secure complex copper
concentrate on terms that are economic; possible variations in ore
grade and recovery rates; inherent uncertainties in respect of
conclusions of economic evaluations, economic studies and mine
plans, including the Loma Larga feasibility study; uncertainties
with respect to timing of the updated Loma Larga feasibility study;
changes in project parameters, including schedule and budget, as
plans continue to be refined; uncertainties with respect to
realizing the anticipated benefits from the acquisition of INV
Metals Inc. and the development of the Loma Larga gold project;
uncertainties with respect to actual results of current exploration
activities; uncertainties and risks inherent to developing and
commissioning new mines into production, which may be subject to
unforeseen delays; uncertainties inherent with conducting business
in foreign jurisdictions where corruption, civil unrest, political
instability and uncertainties with the rule of law may impact the
Company’s activities; limitations on insurance coverage; accidents,
labour disputes and other risks of the mining industry; delays in
obtaining governmental approvals or financing or in the completion
of development or construction activities; actual results of
current and planned reclamation activities; opposition by social
and non-governmental organizations to mining projects and smelting
operations; unanticipated title disputes; claims or litigation;
failure to achieve certain cost savings or the potential benefits
of any upgrades and/or expansion, including the potential rotary
holding furnace installation at the Tsumeb smelter; increased costs
and physical risks, including extreme weather events and resource
shortages, related to climate change; cyber-attacks and other
cybersecurity risks; there being no assurance that the Company will
purchase additional common shares of the Company under the NCIB;
risks related to the timing, completion and expected benefit of the
acquisition by B2Gold of Sabina; risks related to the
implementation, cost and realization of benefits from digital
initiatives; uncertainties with respect to realizing the targeted
MineRP earn-outs as well as those risk factors discussed or
referred to in the Company’s annual MD&A and annual information
form for the year ended December 31, 2021, the MD&A, and other
documents filed from time to time with the securities regulatory
authorities in all provinces and territories of Canada and
available on SEDAR at www.sedar.com.
The reader has been cautioned that the foregoing
list is not exhaustive of all factors and assumptions which may
have been used. Although the Company has attempted to identify
important factors that could cause actual actions, events or
results to differ materially from those described in Forward
Looking Statements, there may be other factors that cause actions,
events or results not to be anticipated, estimated or intended.
There can be no assurance that Forward Looking Statements will
prove to be accurate, as actual results and future events could
differ materially from those anticipated in such statements. The
Company’s Forward Looking Statements reflect current expectations
regarding future events and speak only as of the date hereof. Other
than as it may be required by law, the Company undertakes no
obligation to update Forward Looking Statements if circumstances or
management’s estimates or opinions should change. Accordingly,
readers are cautioned not to place undue reliance on Forward
Looking Statements.
Non-GAAP Financial Measures
Certain financial measures referred to in this
news release are not measures recognized under IFRS and are
referred to as non-GAAP financial measures or ratios. These
measures have no standardized meanings under IFRS and may not be
comparable to similar measures presented by other companies. The
definitions established and calculations performed by DPM are based
on management’s reasonable judgment and are consistently applied.
These measures are used by management and investors to assist with
assessing the Company’s performance, including its ability to
generate sufficient cash flow to meet its return objectives and
support its investing activities and debt service obligations. In
addition, the Human Capital and Compensation Committee of the Board
of Directors uses certain of these measures, together with other
measures, to set incentive compensation goals and assess
performance. These measures are intended to provide additional
information and should not be considered in isolation or as a
substitute for measures prepared in accordance with IFRS. Non-GAAP
financial measures and ratios, together with other financial
measures calculated in accordance with IFRS, are considered to be
important factors that assist investors in assessing the Company’s
performance.
Non-GAAP Cash Cost and All-in Sustaining
Cost Measures
Mine cash cost; smelter cash cost; mine cash
cost of sales; and all-in sustaining cost are non-GAAP financial
measures. Cash cost per tonne of ore processed; cash cost per ounce
of gold sold; all-in sustaining cost per ounce of gold sold; and
cash cost per tonne of complex concentrate smelted are non-GAAP
ratios. These measures capture the important components of the
Company’s production and related costs. Management and investors
utilize these metrics as an important tool to monitor cost
performance at the Company’s operations. In addition, the Human
Capital and Compensation Committee of the Board of Directors uses
certain of these measures, together with other measures, to set
incentive compensation goals and assess performance.
The following tables provide a reconciliation of
the Company’s cash cost per tonne of ore processed and cash cost
per tonne of complex concentrate smelted to its cost of sales:
$ thousands, unless otherwise indicatedFor the three months
ended December 31, 2022 |
Chelopech |
|
Ada Tepe |
|
Tsumeb |
|
Total |
Ore processed |
t |
553,088 |
|
206,153 |
|
- |
|
|
Complex concentrate
smelted |
t |
- |
|
- |
|
41,835 |
|
|
Cost of sales |
|
39,438 |
|
25,703 |
|
25,968 |
|
91,109 |
Add/(deduct): |
|
|
|
|
|
Depreciation and amortization |
|
(7,456 |
) |
(13,948 |
) |
(800 |
) |
|
Change in concentrate inventory |
|
(3,985 |
) |
193 |
|
- |
|
|
Sulphuric acid revenue(1) |
|
- |
|
- |
|
(6,625 |
) |
|
Mine
cash cost / Smelter cash cost(2) |
|
27,997 |
|
11,948 |
|
18,543 |
|
|
Cost of sales per tonne of ore
processed(3) |
$/t |
71 |
|
125 |
|
- |
|
|
Cash cost per tonne of ore
processed(3) |
$/t |
51 |
|
58 |
|
- |
|
|
Cost of sales per tonne of
complex concentrate smelted(4) |
$/t |
- |
|
- |
|
621 |
|
|
Cash
cost per tonne of complex concentrate smelted(4) |
$/t |
- |
|
- |
|
443 |
|
|
$ thousands, unless otherwise indicatedFor the three months ended
December 31, 2021 |
Chelopech |
|
Ada Tepe |
|
Tsumeb |
|
Total |
Ore processed |
t |
561,986 |
|
219,325 |
|
- |
|
|
Complex concentrate
smelted |
t |
- |
|
- |
|
51,932 |
|
|
Cost of sales |
|
33,474 |
|
27,004 |
|
33,564 |
|
94,042 |
Add/(deduct): |
|
|
|
|
|
Depreciation and amortization |
|
(5,766 |
) |
(13,604 |
) |
(3,736 |
) |
|
Change in concentrate inventory |
|
2,289 |
|
(253 |
) |
- |
|
|
Other non-cash expenses |
|
155 |
|
72 |
|
- |
|
|
Sulphuric acid revenue(1) |
|
- |
|
- |
|
(6,614 |
) |
|
Mine cash cost / Smelter cash cost(2) |
|
30,152 |
|
13,219 |
|
23,214 |
|
|
Cost of sales per tonne of ore processed(3) |
$/t |
60 |
|
123 |
|
- |
|
|
Cash cost per tonne of ore
processed(3) |
$/t |
54 |
|
60 |
|
- |
|
|
Cost of sales per tonne of
complex concentrate smelted(4) |
$/t |
- |
|
- |
|
646 |
|
|
Cash
cost per tonne of complex concentrate smelted(4) |
$/t |
- |
|
- |
|
447 |
|
|
|
|
|
|
|
|
|
|
|
1) Represents a by-product credit for
Tsumeb.2) Cash costs are reported in U.S. dollars, although
the majority of costs incurred are denominated in non-U.S. dollars,
and consist of all production related expenses including mining,
processing, services, royalties and general and
administrative.3) Represents cost of sales and mine cash cost,
respectively, divided by tonnes of ore processed.4) Represents
cost of sales and smelter cash cost, respectively, divided by
tonnes of complex concentrate smelted.
$ thousands, unless otherwise indicatedFor the twelve
months ended December 31, 2022 |
Chelopech |
|
Ada Tepe |
|
Tsumeb |
|
Total |
Ore processed |
t |
2,138,792 |
|
852,990 |
|
- |
|
|
Complex concentrate
smelted |
t |
- |
|
- |
|
174,122 |
|
|
Cost of sales |
|
133,929 |
|
102,739 |
|
120,779 |
|
357,447 |
Add/(deduct): |
|
|
|
|
|
Depreciation and amortization |
|
(26,132 |
) |
(55,984 |
) |
(17,023 |
) |
|
Change in concentrate inventory |
|
(1,671 |
) |
181 |
|
- |
|
|
Sulphuric acid revenue(1) |
|
- |
|
- |
|
(23,052 |
) |
|
Mine cash cost / Smelter cash cost(2) |
|
106,126 |
|
46,936 |
|
80,704 |
|
|
Cost of sales per tonne of ore processed(3) |
|
63 |
|
120 |
|
- |
|
|
Cash cost per tonne of ore
processed(3) |
$/t |
50 |
|
55 |
|
- |
|
|
Cost of sales per tonne of
complex concentrate smelted(4) |
$/t |
- |
|
- |
|
694 |
|
|
Cash
cost per tonne of complex concentrate smelted(4) |
$/t |
- |
|
- |
|
463 |
|
|
$ thousands, unless otherwise indicatedFor the twelve months ended
December 31, 2021 |
Chelopech |
|
Ada Tepe |
|
Tsumeb |
|
Total |
Ore processed |
t |
2,199,155 |
|
865,587 |
|
- |
|
|
Complex concentrate
smelted |
t |
- |
|
- |
|
189,705 |
|
|
Cost of sales |
|
128,726 |
|
99,748 |
|
128,662 |
|
357,136 |
Add/(deduct): |
|
|
|
|
|
Depreciation and amortization |
|
(22,063 |
) |
(54,405 |
) |
(18,202 |
) |
|
Other non-cash expenses(5) |
|
155 |
|
72 |
|
(652 |
) |
|
Change in concentrate inventory |
|
(3,196 |
) |
(247 |
) |
- |
|
|
Sulphuric acid revenue(1) |
|
- |
|
- |
|
(18,840 |
) |
|
Mine cash cost / Smelter cash cost(2) |
|
103,622 |
|
45,168 |
|
90,968 |
|
|
Cost of sales per tonne of ore processed(3) |
$/t |
59 |
|
115 |
|
- |
|
|
Cash cost per tonne of ore
processed(3) |
$/t |
47 |
|
52 |
|
- |
|
|
Cost of sales per tonne of
complex concentrate smelted(4) |
$/t |
- |
|
- |
|
678 |
|
|
Cash
cost per tonne of complex concentrate smelted(4) |
$/t |
- |
|
- |
|
480 |
|
|
|
|
|
|
|
|
|
|
|
1) Represents a by-product credit for
Tsumeb.2) Cash costs are reported in U.S. dollars, although
the majority of costs incurred are denominated in non-U.S. dollars,
and consist of all production related expenses including mining,
processing, services, royalties and general and
administrative.3) Represents cost of sales and mine cash cost,
respectively, divided by tonnes of ore processed.4) Represents
cost of sales and smelter cash cost, respectively, divided by
tonnes of complex concentrate smelted.5) Relates to inventory
write-down to net realizable value, reflecting market price
movement, included in cost of sales in the audited consolidated
statements of earnings (loss).
The following table provides, for the periods
indicated, a reconciliation of the Company’s cash cost per ounce of
gold sold and all-in sustaining cost per ounce of gold sold to its
cost of sales:
$ thousands, unless otherwise indicatedFor the three months
ended December 31, 2022 |
|
Chelopech |
|
Ada Tepe |
|
Total |
|
Cost of sales |
|
39,438 |
|
25,703 |
|
65,141 |
|
Add/(deduct): |
|
|
|
|
Depreciation and amortization |
|
(7,456 |
) |
(13,948 |
) |
(21,404 |
) |
Treatment charges, transportation and other related selling
costs(1) |
|
26,529 |
|
864 |
|
27,393 |
|
By-product credits(2) |
|
(24,717 |
) |
(260 |
) |
(24,977 |
) |
Mine cash cost of sales |
|
33,794 |
|
12,359 |
|
46,153 |
|
Rehabilitation related
accretion and depreciation expenses(3) |
|
264 |
|
295 |
|
559 |
|
General and administrative
expenses(4) |
|
4,943 |
|
2,469 |
|
7,412 |
|
Cash outlays for sustaining
capital(5) |
|
9,879 |
|
1,840 |
|
11,719 |
|
Cash outlays for
leases(5) |
|
251 |
|
280 |
|
531 |
|
All-in sustaining cost |
|
49,131 |
|
17,243 |
|
66,374 |
|
Payable gold in concentrate sold(6) |
oz |
39,203 |
|
26,628 |
|
65,831 |
|
Cost of sales per ounce of
gold sold(7) |
$/oz |
1,006 |
|
965 |
|
990 |
|
Cash cost per ounce of gold
sold(7) |
$/oz |
862 |
|
464 |
|
701 |
|
All-in
sustaining cost per ounce of gold sold(7) |
$/oz |
1,253 |
|
648 |
|
1,008 |
|
$ thousands, unless otherwise indicatedFor the three months ended
December 31, 2021 |
|
Chelopech |
|
Ada Tepe |
|
Total |
|
Cost of sales |
|
33,474 |
|
27,004 |
|
60,478 |
|
Add/(deduct): |
|
|
|
|
Depreciation and amortization |
|
(5,766 |
) |
(13,604 |
) |
(19,370 |
) |
Other non-cash expenses |
|
155 |
|
72 |
|
227 |
|
Treatment charges, transportation and other related selling
costs(1) |
|
29,571 |
|
964 |
|
30,535 |
|
By-product credits(2) |
|
(31,703 |
) |
(285 |
) |
(31,988 |
) |
Mine cash cost of sales |
|
25,731 |
|
14,151 |
|
39,882 |
|
Rehabilitation related
accretion expenses(3) |
|
70 |
|
32 |
|
102 |
|
General and administrative
expenses(4) |
|
3,568 |
|
2,361 |
|
5,929 |
|
Cash outlays for sustaining
capital(5) |
|
4,158 |
|
5,235 |
|
9,393 |
|
Cash outlays for
leases(5) |
|
237 |
|
347 |
|
584 |
|
All-in sustaining cost |
|
33,764 |
|
22,126 |
|
55,890 |
|
Payable gold in concentrate sold(6) |
oz |
40,538 |
|
33,282 |
|
73,820 |
|
Cost of sales per ounce of
gold sold(7) |
$/oz |
826 |
|
811 |
|
819 |
|
Cash cost per ounce of gold
sold(7) |
$/oz |
635 |
|
425 |
|
540 |
|
All-in
sustaining cost per ounce of gold sold(7) |
$/oz |
833 |
|
665 |
|
757 |
|
|
|
|
|
|
|
|
|
1) Represents revenue deductions for
treatment charges, refining charges, penalties, freight and final
settlements to adjust for any differences relative to the
provisional invoice.2) Represents copper and silver
revenue.3) Included in cost of sales and finance costs in the
audited consolidated statements of earnings
(loss).4) Represents an allocated portion of DPM’s general and
administrative expenses, including share-based compensation
expense, based on Chelopech’s and Ada Tepe’s proportion of total
revenue.5) Included in cash used in investing activities and
financing activities, respectively, in the audited consolidated
statements of cash flows.6) Includes payable gold in pyrite
concentrate sold in the fourth quarter of 2022 of 10,408 ounces
(2021 – 11,331 ounces).7) Represents cost of sales, mine cash
cost of sales and all-in sustaining cost, respectively, divided by
payable gold in concentrate sold.
$ thousands, unless otherwise indicatedFor the twelve
months ended December 31, 2022 |
|
Chelopech |
|
Ada Tepe |
|
Total |
|
Cost of sales |
|
133,929 |
|
102,739 |
|
236,668 |
|
Add/(deduct): |
|
|
|
|
Depreciation and amortization |
|
(26,132 |
) |
(55,984 |
) |
(82,116 |
) |
Treatment charges, transportation and other related selling
costs(1) |
|
111,016 |
|
2,943 |
|
113,959 |
|
By-product credits(2) |
|
(110,959 |
) |
(793 |
) |
(111,752 |
) |
Mine cash cost of sales |
|
107,854 |
|
48,905 |
|
156,759 |
|
Rehabilitation related
accretion and depreciation expenses(3) |
|
1,020 |
|
1,353 |
|
2,373 |
|
General and administrative
expenses(4) |
|
14,888 |
|
8,052 |
|
22,940 |
|
Cash outlays for sustaining
capital(5) |
|
20,285 |
|
10,193 |
|
30,478 |
|
Cash outlays for
leases(5) |
|
959 |
|
1,185 |
|
2,144 |
|
All-in sustaining cost |
|
145,006 |
|
69,988 |
|
214,694 |
|
Payable gold in concentrate sold(6) |
oz |
151,580 |
|
91,117 |
|
242,697 |
|
Cost of sales per ounce of
gold sold(7) |
$/oz |
884 |
|
1,128 |
|
975 |
|
Cash cost per ounce of gold
sold(7) |
$/oz |
712 |
|
537 |
|
646 |
|
All-in
sustaining cost per ounce of gold sold(7) |
$/oz |
957 |
|
765 |
|
885 |
|
$ thousands, unless otherwise indicatedFor the twelve months ended
December 31, 2021 |
|
Chelopech |
|
Ada Tepe |
|
Total |
|
Cost of sales |
|
128,726 |
|
99,748 |
|
228,474 |
|
Add/(deduct): |
|
|
|
|
Depreciation and amortization |
|
(22,063 |
) |
(54,405 |
) |
(76,468 |
) |
Other non-cash expenses |
|
155 |
|
72 |
|
227 |
|
Treatment charges, transportation and other related selling
costs(1) |
|
102,901 |
|
4,310 |
|
107,211 |
|
By-product credits(2) |
|
(128,636 |
) |
(1,038 |
) |
(129,674 |
) |
Mine cash cost of sales |
|
81,083 |
|
48,687 |
|
129,770 |
|
Rehabilitation related
accretion expenses(3) |
|
256 |
|
125 |
|
381 |
|
General and administrative
expenses(4) |
|
10,019 |
|
7,847 |
|
17,866 |
|
Cash outlays for sustaining
capital(5) |
|
15,511 |
|
17,469 |
|
32,980 |
|
Cash outlays for
leases(5) |
|
936 |
|
1,466 |
|
2,402 |
|
All-in sustaining cost |
|
107,805 |
|
75,594 |
|
183,399 |
|
Payable gold in concentrate sold(6) |
oz |
149,297 |
|
129,754 |
|
279,051 |
|
Cost of sales per ounce of
gold sold(7) |
$/oz |
862 |
|
769 |
|
819 |
|
Cash cost per ounce of gold
sold(7) |
$/oz |
543 |
|
375 |
|
465 |
|
All-in
sustaining cost per ounce of gold sold(7) |
$/oz |
722 |
|
583 |
|
657 |
|
|
|
|
|
|
|
|
|
1) Represents revenue deductions for
treatment charges, refining charges, penalties, freight and final
settlements to adjust for any differences relative to the
provisional invoice.2) Represents copper and silver
revenue.3) Included in cost of sales and finance costs in the
audited consolidated statements of earnings
(loss).4) Represents an allocated portion of DPM’s general and
administrative expenses, including share-based compensation
expense, based on Chelopech’s and Ada Tepe’s proportion of total
revenue.5) Included in cash used in investing activities and
financing activities, respectively, in the audited consolidated
statements of cash flows.6) Includes payable gold in pyrite
concentrate sold in 2022 of 40,828 ounces (2021 – 37,747
ounces).7) Represents cost of sales, mine cash cost of sales
and all-in sustaining cost, respectively, divided by payable gold
in concentrate sold.
Adjusted net earnings and adjusted basic
earnings per share
Adjusted net earnings is a non-GAAP financial
measure and adjusted basic earnings per share is a non-GAAP ratio
used by management and investors to measure the underlying
operating performance of the Company. Presenting these measures
from period to period helps management and investors evaluate
earnings trends more readily in comparison with results from prior
periods.
Adjusted net earnings are defined as net
earnings attributable to common shareholders, adjusted to exclude
specific items that are significant, but not reflective of the
underlying operations of the Company, including:
- impairment
charges or reversals thereof
- unrealized and
realized gains or losses related to investments carried at fair
value;
- significant tax
adjustments not related to current period earnings; and
- non-recurring or
unusual income or expenses that are either not related to the
Company’s operating segments or unlikely to occur on a regular
basis.
The following table provides a reconciliation of
adjusted net earnings to net earnings attributable to common
shareholders from continuing operations:
$ thousands |
Three Months |
|
Twelve Months |
Ended December 31, |
2022 |
|
2021 |
|
|
2022 |
|
2021 |
|
Net earnings attributable to common shareholders from continuing
operations |
33,320 |
|
52,108 |
|
|
35,923 |
|
190,750 |
|
Add/(deduct): |
|
|
|
|
|
|
|
|
Impairment charge |
- |
|
- |
|
|
85,000 |
|
- |
|
Net (gains) loss on Sabina special warrants, net of income taxes of
$nil |
- |
|
(659 |
) |
|
2,369 |
|
6,312 |
|
Tsumeb restructuring costs |
- |
|
- |
|
|
5,735 |
|
- |
|
Deferred income tax expense not related to current period
earnings(1) |
- |
|
- |
|
|
- |
|
5,019 |
|
Adjusted net earnings |
33,320 |
|
51,449 |
|
|
129,027 |
|
202,081 |
|
Basic earnings per share |
0.18 |
|
0.27 |
|
|
0.19 |
|
1.02 |
|
Adjusted basic earnings per share |
0.18 |
|
0.27 |
|
|
0.68 |
|
1.09 |
|
1) Represents changes in unrecognized tax
benefits included in net earnings related to unrealized gains
(losses) on publicly traded securities, which, together with the
related deferred income tax expense (recovery), were recognized in
other comprehensive income (loss).
Adjusted EBITDA
Adjusted EBITDA is a non-GAAP financial measure
used by management and investors to measure the underlying
operating performance of the Company’s operating segments.
Presenting these measures from period to period helps management
and investors evaluate earnings trends more readily in comparison
with results from prior periods. In addition, the Human Capital and
Compensation Committee of the Board of Directors uses adjusted
EBITDA, together with other measures, to set incentive compensation
goals and assess performance.
Adjusted EBITDA excludes the following from
earnings before income taxes:
- depreciation and
amortization;
- interest
income;
- finance
cost;
- impairment
charges or reversals thereof;
- unrealized and
realized gains or losses related to investments carried at fair
value; and
- non-recurring or
unusual income or expenses that are either not related to the
Company’s operating segments or unlikely to occur on a regular
basis.
The following table provides a reconciliation of adjusted EBITDA
to earnings before income taxes:
$ thousands |
Three Months |
|
Twelve Months |
Ended December 31, |
2022 |
|
2021 |
|
|
2022 |
|
2021 |
|
Earnings before income taxes |
37,632 |
|
60,274 |
|
|
58,742 |
|
229,418 |
|
Add/(deduct): |
|
|
|
|
|
Impairment charge |
- |
|
- |
|
|
85,000 |
|
- |
|
Depreciation and amortization |
22,740 |
|
23,533 |
|
|
101,252 |
|
96,207 |
|
Tsumeb restructuring costs |
- |
|
- |
|
|
5,735 |
|
- |
|
Finance costs |
1,555 |
|
1,380 |
|
|
6,325 |
|
5,549 |
|
Interest income |
(3,673 |
) |
(254 |
) |
|
(6,554 |
) |
(632 |
) |
Net (gains) losses on Sabina special warrants |
- |
|
(659 |
) |
|
2,369 |
|
6,312 |
|
Adjusted EBITDA |
58,254 |
|
84,274 |
|
|
252,869 |
|
336,854 |
|
|
|
|
|
|
|
|
|
|
|
Cash provided from operating activities,
before changes in working capital
Cash provided from operating activities, before
changes in working capital, is a non-GAAP financial measure defined
as cash provided from operating activities excluding changes in
working capital as set out in the Company’s consolidated statements
of cash flows. This measure is used by the Company and investors to
measure the cash flow generated by the Company’s operating segments
prior to any changes in working capital, which at times can distort
performance.
Free cash flow
Free cash flow is a non-GAAP financial measure
defined as cash provided from operating activities, before changes
in working capital which includes changes in share-based
compensation liabilities, less cash outlays for sustaining capital,
mandatory principal repayments and interest payments related to
debt and leases. This measure is used by the Company and investors
to measure the cash flow available to fund growth capital
expenditures, dividends and share repurchases.
The following table provides a reconciliation of
cash provided from operating activities, before changes in working
capital and free cash flow to cash provided from operating
activities:
$ thousands |
Three Months |
|
Twelve Months |
Ended December 31, |
2022 |
|
2021 |
|
|
2022 |
|
2021 |
|
Cash provided from operating activities |
49,289 |
|
88,940 |
|
|
232,052 |
|
253,580 |
|
Add: |
|
|
|
|
|
Changes in working capital |
3,064 |
|
(8,877 |
) |
|
(4,857 |
) |
55,469 |
|
Cash provided from operating activities, before changes in working
capital |
52,353 |
|
80,063 |
|
|
227,195 |
|
309,049 |
|
Cash outlays for sustaining
capital(1) |
(17,160 |
) |
(12,724 |
) |
|
(53,823 |
) |
(49,758 |
) |
Principal repayments related
to leases |
(1,207 |
) |
(1,165 |
) |
|
(4,620 |
) |
(4,455 |
) |
Interest payments(1) |
(723 |
) |
(367 |
) |
|
(2,315 |
) |
(2,443 |
) |
Free cash flow |
33,263 |
|
65,807 |
|
|
166,437 |
|
252,393 |
|
|
|
|
|
|
|
|
|
|
|
1) Included in cash used in investing and
financing activities, respectively in the audited consolidated
statements of cash flows.
Average realized metal
prices
Average realized gold and copper prices are
non-GAAP ratios used by management and investors to highlight the
price actually realized by the Company relative to the average
market price, which can differ due to the timing of sales, hedging
and other factors.
Average realized gold and copper prices
represent the average per unit price recognized in the Company’s
consolidated statements of earnings (loss) prior to any deductions
for treatment charges, refining charges, penalties, freight and
final settlements to adjust for any differences relative to the
provisional invoice.
The following table provides a reconciliation of
the Company’s average realized gold and copper prices to its
revenue:
$ thousands, unless otherwise indicated |
|
Three Months |
|
Twelve Months |
Ended December 31, |
|
2022 |
|
2021 |
|
|
2022 |
|
2021 |
|
Total revenue |
|
152,863 |
|
166,433 |
|
|
569,795 |
|
641,443 |
|
Add/(deduct): |
|
|
|
|
|
|
Tsumeb revenue |
|
(39,895 |
) |
(33,574 |
) |
|
(136,305 |
) |
(119,350 |
) |
Treatment charges and other deductions(1) |
|
27,393 |
|
30,535 |
|
|
113,959 |
|
107,211 |
|
Silver revenue |
|
(446 |
) |
(1,127 |
) |
|
(3,319 |
) |
(4,831 |
) |
Revenue from gold and copper |
|
139,915 |
|
162,267 |
|
|
544,130 |
|
624,473 |
|
Revenue from gold |
|
115,341 |
|
131,407 |
|
|
435,657 |
|
499,630 |
|
Payable gold in concentrate
sold |
oz |
65,831 |
|
73,820 |
|
|
242,697 |
|
279,051 |
|
Average realized gold price
per ounce |
$/oz |
1,752 |
|
1,780 |
|
|
1,795 |
|
1,790 |
|
Revenue from copper |
|
24,574 |
|
30,860 |
|
|
108,473 |
|
124,843 |
|
Payable copper in concentrate
sold |
Klbs |
6,726 |
|
8,175 |
|
|
27,224 |
|
32,680 |
|
Average
realized copper price per pound |
$/lb |
3.65 |
|
3.77 |
|
|
3.98 |
|
3.82 |
|
1) Represents revenue deductions for
treatment charges, refining charges, penalties, freight and final
settlements to adjust for any differences relative to the
provisional invoice.
Dundee Precious Metals (TSX:DPM)
Historical Stock Chart
From May 2024 to Jun 2024
Dundee Precious Metals (TSX:DPM)
Historical Stock Chart
From Jun 2023 to Jun 2024