SUMMARY OF INTERIM REPORT for JANUARY-MARCH 2017
Increased grade improved gold production and sales
HIGHLIGHTS Q1 2017 (Q1 2016)
- Gold production 97.9 kg (58.5)
- Milled ore 40,804 tonnes (35,317) at 2.9 g/t (2.1)
- Cash Cost 1,206 USD/oz (1,312)
- Revenues 28.7 MSEK (16.3)
- EBITDA -1.3 MSEK (-6.3)
- Profit after tax -12.2 MSEK (-14.8)
- Earnings per share -1.16 SEK (-1.73)
- Ms. Saila Miettinen-Lähde appointed as CEO of Endomines AB from 1st of May 2017
SUBSEQUENT EVENTS
- No significant events to be reported
PRODUCTION GUIDANCE
- During 2017 the Company expects to produce between 300 and 350 kg gold
Some key financial measures
| Key financial data | Jan-March | ||
| MSEK | 2017 | 2016 | +/- |
| Total revenues | 28,7 | 16,3 | 12,4 |
| Total cost | -30,1 | -22,6 | -7,5 |
| EBITDA | -1,3 | -6,3 | 5,0 |
| EBIT | -10,9 | -14,8 | 3,8 |
| Investments | 9,7 | 4,1 | 5,6 |
Operations during the 1st quarter 2017
Total gold production for the 1st quarter amounted to 97.9 kg, which is significantly better compared to Q1/2016. Gold production was in line with the increased gold production achieved during the previous period. The mill throughput exceeded slightly the expectations for the reporting period.
| Key production figures | Q1 | Q1 | Q2 | Q3 | Q4 | Rolling |
| 2017 | 2016 | 2016 | 2016 | 2016 | 12 mths | |
| Milled ore (tonnes) | 40 804 | 35 317 | 37 303 | 36 104 | 42 193 | 156 404 |
| Head grade (Au gram/tonne) | 2,9 | 2,1 | 2,4 | 2,7 | 3,1 | 2,8 |
| Gold recovery (%) | 83,6 | 80,2 | 82,8 | 85,3 | 83,0 | 83,7 |
| Hourly utilization (%) | 41,0 | 35,3 | 37,7 | 34,0 | 43,5 | 39,1 |
| Gold production (kg) | 97,9 | 58,5 | 73,7 | 83,0 | 109,8 | 364,3 |
| Gold production (oz) | 3 148 | 1 882 | 2 369 | 2 667 | 3 531 | 11 713 |
| LTIFR | 8 | 5 | 6 | 6 | 8 | 8 |
| Cost per milled ore tonne (EUR) | 76 | 58 | 71 | 66 | 74 | 72 |
| Cost per milled ore tonne (SEK) | 729 | 541 | 656 | 624 | 720 | 685 |
| Cash Cost (USD/oz) | 1 206 | 1 312 | 1 396 | 1 113 | 1 060 | 1 179 |
| Average gold price (USD(oz) | 1 219 | 1 179 | 1 258 | 1 335 | 1 220 | 1 258 |
| Note! Decimals are indicated by a comma and thousands are separated by a space | ||||||
Production figures for the last quarter are based on company own assaying and not confirmed by any external laboratory. Figures are individually rounded off.
LTIFR = The Lost Time Injury Frequency Rate is based on reported lost time injuries on a rolling 12-month bases resulting in one day/shift or more off work per 1 million hours worked. LTIFR has been calculated for the whole company including contractors
The main reason for the improved gold production was, in relative terms, the high grade ore available for mining, in combination with successful selective mining performance during the reported period. The rather high head grade had as well a positive impact on the gold recovery at the mill.
Underground development and exploration
During the reporting period the decline was developed down to the 755 level. The horizontal development exceeded the planned levels due to a substantially increased productivity in the mine development cycle. The produced volume of the ore was higher than planned and created a minor ore stockpile at surface, available as a back up volume for processing. These activities led to an increased operating cost but were deemed necessary in order to achieve a satisfactory production reliability for the remainder of the year, and especially for the upcoming vacation period.
The underground exploration and infill drilling meters were, for the same reasons, increased. The exploration of the potential production areas below the current production levels has commenced and the results are expected to be available during second half of 2017.
Regional exploration activities in the Karelian Gold Line
Regional exploration along the Karelian Gold line was concentrated to planning of activities. No physical exploration was done.
Health, environment and safety
The Company’s safety performance is on a good level. The overall strategy is a non-acceptance of accidents and adverse environmental incidents, a Zero Harm policy. Late 2016, the Pampalo mine implemented a LEAN methodology project to improve housekeeping and to boost the safety performance. The project is progressing well.
Personnel
The number of employees in the Group at end of March 31 was 43 persons as compared to 44 persons at the end of last year.
Subsequent events
No significant subsequent events to report.
Outlook for 2017, Selective Mining continues
During 2017 the Company expects to produce between 300 and 350 kg gold at Pampalo. Production in 2017 will, as for 2016, be based on the selective mining principle. During 2017, the Company intends to mine and process approximately 150,000 tonnes of ore. Mining will be concentrated to areas with, in relative terms, higher in situ grade. The mine will operate during weekdays whereas the mill will run according to, and in average, an every second week roster.
Future liquidity development
Exploration and mine development activities requires access to financing. It is the Board's assessment that current working capital is not sufficient for all scheduled activities in the coming 12-months period. The operations might as a consequence need to be adjusted by postponing some investments and other mine development costs in order to secure the working capital level. The Board is actively engaged with financing as a significant part of the Company´s growth strategy.
Financial Calendar
Summary press releases in English on 2017 quarterly reports to be issued:
- Q2 2017 on August 18
- Q3 2017 on November 9
Full quarterly report for Q1 2017 in Swedish
For the full quarterly report in Swedish see the company website, www.endomines.com.
Contact person
Markus Ekberg, CEO of Endomines AB, phone +358-40-706 48 50
E-mail: markus.ekberg(at)endomines.com
This information is information that Endomines AB is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Market Act. The information was submitted for publication, through the agency of the contact person(s) set out above, at 08:45 CET on APRIL 27, 2017.
-----------------------------------------------------------------------------------------------------------------------------------
About Endomines
Endomines is a gold concentrate producer with mining, development and exploration operations in Eastern Finland along the 40 kilometer long Karelian Gold Line. Through various regulatory approvals, Endomines controls the exploration rights to this entire area. Endomines vision is to participate in the future structural transformation and consolidation of the Nordic mining industry. The Company may therefore be involved in acquisitions of interesting deposits or companies, should such opportunities arise.
The shares trade on Nasdaq Stockholm (ENDO) and Nasdaq Helsinki (ENDOM).
Tags: