/NOT FOR DISSEMINATION OR DISTRIBUTION IN
THE UNITED STATES AND NOT FOR
DISTRIBUTION TO US NEWSWIRE SERVICES./
(All financial figures in US Dollars unless
otherwise stated)
MELBOURNE, July 27, 2017 /CNW/ - OceanaGold Corporation
(TSX/ASX: OGC) (the "Company") is pleased to release its financial
and operational results for the quarter ended 30 June 2017. Details of the consolidated
financial statements and the Management Discussion and Analysis
("MD&A") are available on the Company's website at
www.oceanagold.com
Key Highlights
- Consolidated production of 272,352 ounces of gold and 10,277
tonnes of copper in the first half of 2017, including 124,396
ounces of gold and 4,322 tonnes of copper in the second
quarter.
- Consolidated year-to-date All-In Sustaining Costs of
$599 per ounce on sales of 228,214
ounces of gold (excluding Haile) and 9,976 tonnes of copper.
- Consolidated second quarter All-In Sustaining Costs of
$681 per ounce on sales of 114,192
ounces of gold (excluding Haile) and 5,828 tonnes of copper.
- First half revenue of $333.5
million with EBITDA of $186.4
million and a net profit of $61.4
million.
- Second quarter revenue of $171.7
million with an EBITDA of $84.7
million and a net profit of $25.4
million.
- Completed the Haile Optimisation Study which demonstrated
significant value enhancement through increased production and cash
flows over a longer mine life and a 70% increase in total
reserves.
- Immediate liquidity of $126.8
million including $81.6
million in cash, excluding $71.6
million of marketable securities held in strategic
investments.
- Continued encouraging exploration results.
Mick Wilkes, President and CEO of
OceanaGold said, "The first half of the year yielded strong
financial and operating results from our diversified portfolio of
assets. The Didipio operation continued its strong performance
delivering strong cash flows and high-margin ounces to offset
weaker production from Haile where production is improving as we
rectify the commissioning issues previously flagged."
He added, "Although commissioning of the Haile process plant has
taken longer than expected, it is still a top-tier asset as
reflected by the results of the optimisation study. Over the next
18 years or more we expect the Haile Gold Mine to deliver
significant cash flows and remain excited about the long term
exploration potential of the district. We plan to be
operating there for a very long time."
Table 1
– Production and Cost Results
Summary
|
|
|
|
|
|
|
|
|
|
Didipio
|
Waihi
|
Macraes
|
Haile
(2)
|
Consolidated
|
Second Quarter
2017 Results
|
|
Q2
2017
|
Q1 2017
|
Gold
Produced
|
ounces
|
42,899
|
25,559
|
39,778
|
16,160
|
124,396
|
147,956
|
Copper
Produced
|
tonnes
|
4,322
|
-
|
-
|
-
|
4,322
|
5,955
|
Gold Sales
|
ounces
|
47,185
|
24,743
|
42,264
|
15,558
|
129,750
(3)
|
126,225
(3)
|
Copper
Sales
|
tonnes
|
5,828
|
-
|
-
|
-
|
5,828
|
4,148
|
All-In Sustaining
Costs (1)
|
$ per
ounce
|
147
|
913
|
1,140
|
-
|
681
|
521
|
YTD June 30
2017
|
|
YTD Jun 30
2017
|
YTD Jun 30
2016
|
Gold
Produced
|
ounces
|
105,647
|
51,419
|
78,328
|
36,958
|
272,352
|
225,339
|
Copper
Produced
|
tonnes
|
10,277
|
-
|
-
|
-
|
10,277
|
12,244
|
Gold Sales
|
ounces
|
98,652
|
51,500
|
78,062
|
27,761
|
255,975
(3)
|
233,293
|
Copper
Sales
|
tonnes
|
9,976
|
-
|
-
|
-
|
9,976
|
10,858
|
All-In Sustaining
Costs (1)
|
$ per
ounce
|
15
|
876
|
1,154
|
-
|
599
|
722
|
|
|
Notes:
|
1.
|
In this second
quarter 2017 MD&A, all revenue and costs reported do not
include the Haile operations as these have been capitalised as
commercial production is yet to be declared.
|
2.
|
Haile gold mine
commenced selling gold in February 2017. Revenue from the sale of
gold is treated as pre-production income.
|
3.
|
Consolidated 2017
gold sales include gold sales from Haile.
|
Table 2 –
Consolidated Financial Summary*
|
|
|
|
|
|
|
$'000
|
Q2
Jun 30
2017
|
Q1 Mar 31
2017
|
Q2 Jun 30
2016
|
YTD Jun
30
2017
|
YTD Jun 30
2016
|
Revenue
|
171,650
|
161,800
|
169,763
|
333,450
|
330,814
|
Cost of sales,
excluding depreciation and
amortisation
|
(73,767)
|
(56,834)
|
(79,642)
|
(130,601)
|
(151,531)
|
General &
administration – other
|
(14,513)
|
(8,950)
|
(15,565)
|
(23,463)
|
(27,933)
|
Foreign currency
exchange gain/(loss)
|
647
|
(221)
|
2,543
|
426
|
3,268
|
Gain on sale of
available-for-sale assets
|
-
|
5,314
|
-
|
5,314
|
-
|
Other
income/(expense)
|
728
|
562
|
187
|
1,290
|
541
|
Earnings before
interest, tax,
depreciation and amortisation (EBITDA)
(excluding gain/(loss) on undesignated
hedges and impairment charge)
|
84,745
|
101,671
|
77,286
|
186,416
|
155,159
|
Depreciation and
amortisation
|
(51,171)
|
(36,403)
|
(28,015)
|
(87,574)
|
(61,784)
|
Net interest expense
and finance costs
|
(4,292)
|
(4,557)
|
(2,536)
|
(8,848)
|
(4,724)
|
Earnings before
income tax and
gain/(loss) on undesignated hedges and
impairment charge
|
29,282
|
60,711
|
46,735
|
89,994
|
88,651
|
Tax (expense) /
benefit on earnings
|
(4,538)
|
(1,318)
|
(5,599)
|
(5,857)
|
(10,806)
|
Earnings/(loss)
after income tax and
before gain/(loss) on undesignated
hedges and impairment charge
|
24,744
|
59,393
|
41,136
|
84,137
|
77,845
|
Impairment
charge
|
-
|
(17,654)
|
-
|
(17,654)
|
-
|
Gain/(loss) on fair
value of undesignated
hedges
|
1,075
|
(7,874)
|
(1,828)
|
(6,799)
|
(20,132)
|
Tax (expense)/benefit
on gain/loss on
undesignated hedges
|
(301)
|
2,205
|
511
|
1,904
|
5,637
|
Share of
profit/(loss) from equity accounted
associates
|
(161)
|
(65)
|
(164)
|
(226)
|
(164)
|
Net
Profit
|
25,357
|
36,005
|
39,655
|
61,362
|
63,186
|
Basic earnings per
share
|
$0.04
|
$0.06
|
$0.07
|
$0.10
|
$0.10
|
CASH
FLOWS
|
|
|
|
|
|
Cash flows from
Operating Activities
|
88,391
|
52,343
|
91,486
|
140,734
|
123,159
|
Cash flows used in
Investing Activities
|
(71,696)
|
(65,910)
|
(122,496)
|
(137,606)
|
(226,236)
|
Cash flows (used in)
/ from Financing
Activities
|
(6,635)
|
10,545
|
12,827
|
3,910
|
14,860
|
|
Note: In
this second quarter 2017 MD&A, all revenue and costs reported
do not include the Haile operations as these have been capitalised
as commercial production is yet to be declared.
|
On a consolidated basis, during the first half of 2017 the
Company achieved production of 272,352 ounces of gold and 10,277
tonnes of copper, including 124,396 ounces of gold and 4,322 tonnes
of copper in the second quarter. The quarter-on-quarter decrease in
consolidated gold production was expected and previously forecast
and due primarily to lower production from the Didipio operation.
In the second quarter. the Didipio head grade decreased following
the cessation of open pit mining resulting in a higher proportion
of lower grade stockpiled ore processed. Decreased production was
also due to lower production from Haile where issues related to the
commissioning of the Carbon-in-Leach ("CIL") circuit along with
load imbalances in the milling circuit led to lower throughputs and
recoveries.
On a consolidated basis, and excluding Haile gold sales, during
the first half of 2017, the Company recorded an AISC of
$599 per ounce on sales of 228,214
ounces of gold and 9,976 tonnes of copper. During the second
quarter, on a consolidated basis and excluding Haile gold sales,
the Company recorded an AISC of $681
per ounce on sales of 114,192 ounces of gold and 5,828 tonnes of
copper.
During the first half, the Company achieved revenue of
$333.5 million including second
quarter revenue of $171.7
million.
EBITDA in the first half of 2017 was $186.4 million including second quarter EBITDA of
$84.7 million, which was lower
quarter-on-quarter due to increased operating and general and
administrative ("G&A") costs, partially offset by higher
revenue.
For the first half of 2017, the Company achieved a net profit of
$61.4 million and a second quarter
net profit of $25.4 million. The
quarter-on-quarter decrease in net profit was a result of lower
EBITDA, higher depreciation and amortisation costs and tax expense,
which were partially offset by a gain on the fair value of
undesignated hedges.
Operating cash flow for the first half of the year was
$140.7 million including $88.4 million in the second quarter. The increase
in operating cash flow from the first quarter was primarily due to
higher revenues and favorable working capital movements at Didipio
following the reduction of gold-copper concentrate inventories and
decrease in trade debtors.
At the end of the second quarter of 2017, the Company had
immediate available liquidity of $126.8
million which included a cash balance of $81.6 million, excluding $71.6 million in marketable securities from
strategic investments. During the quarter, the Company increased
its revolving credit facilities to $330
million of which $284.8
million was drawn.
Second Quarter 2017 Results Webcast
The Company will host a conference call / webcast to discuss the
results at 7:30 am on Friday
28 July 2017 (Melbourne, Australian Eastern Standard Time) /
5:30 pm on Thursday 27 July 2017 (Toronto, Eastern Daylight Time).
Webcast Participants
To register, please copy and paste the link below into your
browser:
http://event.on24.com/r.htm?e=1462822&s=1&k=3BC20600AC3044BA5401F93244445492
Teleconference Participants (required for those
who wish to ask questions)
Local (toll free) dial in numbers are:
Australia: 1 800 076 068
New Zealand: 0 800 453 421
Canada & North America: 1 888 390 0605
All other countries (toll): + 1 416 764 8609
Playback of Webcast
If you are unable to attend the call, a recording will be
available for viewing on the Company's website.
About OceanaGold
OceanaGold Corporation is a mid-tier, high-margin, multinational
gold producer with assets located in the
Philippines, New Zealand
and the United States. The
Company's assets encompass its flagship operation, the Didipio
Gold-Copper Mine located on the island of Luzon in the Philippines. On the North Island of
New Zealand, the Company operates
the high-grade Waihi Gold Mine while on the South Island of
New Zealand, the Company operates
the largest gold mine in the country at the Macraes Goldfield which
is made up of a series of open pit mines and the Frasers
underground mine. In the United
States, the Company is currently commissioning the Haile
Gold Mine, a top-tier asset located in South Carolina. OceanaGold also has a
significant pipeline of organic growth and exploration
opportunities in the Americas and Asia-Pacific regions.
OceanaGold has operated sustainably over the past 27 years with
a proven track-record for environmental management and community
and social engagement. The Company has a strong social license to
operate and works collaboratively with its valued stakeholders to
identify and invest in social programs that are designed to build
capacity and not dependency.
In 2017, the Company expects to produce 550,000 to 600,000
ounces of gold and 18,000 to 19,000 tonnes of copper with sector
leading All-In Sustaining Costs that range from $600 to $650 per ounce sold.
Cautionary Statement for Public Release
Certain information contained in this public release may be
deemed "forward-looking" within the meaning of applicable
securities laws. Forward-looking statements and information relate
to future performance and reflect the Company's expectations
regarding the generation of free cash flow, execution of business
strategy, future growth, future production, estimated costs,
results of operations, business prospects and opportunities of
OceanaGold Corporation and its related subsidiaries. Any statements
that express or involve discussions with respect to predictions,
expectations, beliefs, plans, projections, objectives, assumptions
or future events or performance (often, but not always, using words
or phrases such as "expects" or "does not expect", "is expected",
"anticipates" or "does not anticipate", "plans", "estimates" or
"intends", or stating that certain actions, events or results
"may", "could", "would", "might" or "will" be taken, occur or be
achieved) are not statements of historical fact and may be
forward-looking statements. Forward-looking statements are subject
to a variety of risks and uncertainties which could cause actual
events or results to differ materially from those expressed in the
forward-looking statements and information. They include, among
others, the accuracy of mineral reserve and resource estimates and
related assumptions, inherent operating risks, sovereign risks,
risk of suspension and those risk factors identified in the
Company's most recent Annual Information Form prepared and filed
with securities regulators which is available on SEDAR at
www.sedar.com under the Company's name. There are no assurances the
Company can fulfil forward-looking statements and information. Such
forward-looking statements and information are only predictions
based on current information available to management as of the date
that such predictions are made; actual events or results may differ
materially as a result of risks facing the Company, some of which
are beyond the Company's control. Although the Company
believes that any forward-looking statements and information
contained in this press release is based on reasonable assumptions,
readers cannot be assured that actual outcomes or results will be
consistent with such statements. Accordingly, readers should not
place undue reliance on forward-looking statements and information.
The Company expressly disclaims any intention or obligation to
update or revise any forward-looking statements and information,
whether as a result of new information, events or otherwise, except
as required by applicable securities laws. The information
contained in this release is not investment or financial product
advice.
SOURCE OceanaGold Corporation