Results for the year ended 31 December 2017 First full year of commercial production: €41 million EBITDA for 37,100 tonnes of Cu

27 March, 2018

Atalaya Mining Plc (AIM: ATYM; TSX: AYM) is pleased to announce its audited consolidated results for the year ended 31 December 2017.

Operational Highlights

Proyecto Riotinto

  • 2017 has been the first full year of commercial production with throughput reporting 8.8 million tonnes of ore processed and stable operations quarter-on-quarter.
  • Copper production was 37,164 tonnes, in line with 2017 guidance and 42% higher than 26,179 tonnes produced in 2016.
  • Copper grade was also consistent with estimates averaging 0.50% for 2017, in line with previous year.
  • Recovery rate was above estimates, increasing to approximately 85.5%, a material improvement on 2016 rate of 83.3%.
  • 2018 production guidance targeting an improvement on 2017, with contained copper estimated within 37,000 – 40,000 tonnes.

 

Expansion of Proyecto Riotinto

  • In June 2017, the Board of Directors approved a feasibility study to increase mining and processing capacity to 15.0 Mtpa.
  • The study was completed in Q3 2017, concluding that the expansion was technically and financially robust.
  • The expansion project was then approved for implementation in Q4 2017. The Group raised funds of €34.7 million to launch the expansion in December 2017.
  • The capital cost estimate is €80.4 million with commissioning scheduled for the second half of 2019. Total copper production is estimated to reach 50,000 – 55,000 tonnes per year once the expansion project is fully operational.

 

Proyecto Touro

 Permitting is progressing according to schedule. Reports were received as part of the permitting process and project improvements were suggested. Consultants have already been engaged to address these recommendations.

  • A technical report is close to completion at pre-feasibility level of detail and in compliance with NI 43-101 guidelines. The report will be released in Q2 2018 once additional project improvements are incorporated to accommodate the final permitting process.
  • In Q3 2017, the Group signed an option agreement to acquire exploration concessions covering 122.7 km2 immediately surrounding Proyecto Touro, where mineralised copper occurrences are documented.
  • An exploration campaign was initiated during the year over the newly optioned exploration concessions around Proyecto Touro. The campaign included an airborne VTEM geophysical survey, detailed assessment of structural geology and a regional geochemical campaign.

 

Financial Highlights

 Sales amounted to €160.5 million in 2017. Inventory of 7,274 tonnes of copper concentrate as of 31 December 2017 were shipped during Q1 2018.

  • Group operating costs and corporate costs amounted to €114.7 million and €4.5 million, respectively, providing an EBITDA of €41.4 million for the twelve months ended 31 December 2017.
  • Cash costs for 2017 were US$1.91/lb of payable copper, providing healthy margins and positive cash flows at average market copper prices of $2.80/lb during the year. AISC averaged $2.30/lb of payable copper for the year. Increases over guidance of $2,20/lb were mainly due to unfavourable foreign exchange and one-off sustaining costs (construction of cover for the coarse ore stockpile). AISC costs were within guidance for the first three quarters of 2017.
  • Net income of €18.2 million (or 15.5 cents per outstanding share).
  • As at 31 December 2017, reported net assets totalled €246.9 million, comprising non-current assets of €283.5 million, non-current liabilities of €58.7 million and working capital of €22.1 million. Long term liabilities include the deferred consideration to Astor presented by the nominal amount of €53 million and the rehabilitation provisions of €5.5 million. Working capital includes €34.7 million of cash from the proceeds of the equity raised in December 2017.
  • During 2017, the Group fully repaid the Transamine Trading S.A. prepayment signed in September 2016 and the Social Security debt signed prior to the declaration of production.
  • Positive cash flows from operating activities for the twelve months ended 31 December 2017 amounted to €30.5 million. Cash used for investing activities was €22.7 million, mainly for deferred mining costs, sustaining capital expenditure at Proyecto Riotinto and capitalised costs at Proyecto Touro. Financing surplus cash flow of €33.9 million was from the equity raised in December 2017.

 

Corporate Highlights

 On 25 April 2017, Atalaya and Astor applied for permission to appeal to the Court of Appeal. On 11 August 2017, the Court of Appeal granted permission to both parties to appeal (although it rejected three of Astor’s seven grounds). The Appeal is anticipated to take place in May 2018.

 Alberto Lavandeira, CEO commented:

“We are delighted to report that our first full year of production at Proyecto Riotinto has been a success, with incremental operating improvements each quarter. We remain positive on the outlook for copper and believe that our plans to expand Riotinto to 15Mtpa and to deliver Proyecto Touro will ensure that these two projects commence production when the fundamentals for copper are at their most robust. 2018 will be another year of exciting progress as we implement these plans to grow our business.”

About Atalaya Mining Plc

Atalaya is an AIM and TSX listed operational and development group which produces copper concentrates and silver by-product at its fully owned Proyecto Riotinto site in southwest Spain. In addition, the Group has a phased, earn-in agreement for up to 80% ownership of Proyecto Touro, a brownfield copper project in the northwest of Spain which is currently in the permitting stage. For further information, visit www.atalayamining.com

Read the full announcement here: ATYM 2017 Final Results RNS (1.3 Mb PDF)

This announcement contains information which, prior to its publication constituted inside information for the purposes of Article 7 of Regulation (EU) No 596/2014.

 Contacts:

Newgate Communications (Financial PR) Charlie Chichester / James Ash / James Browne +44 20 7680 6550
4C Communications (Investor Relations) Carina Corbett +44 20 3170 7973
Canaccord Genuity (NOMAD and Joint Broker) Martin Davison / Henry Fitzgerald-O’Connor / James Asensio +44 20 7523 8000
BMO Capital Markets (Joint Broker) Jeffrey Couch / Neil Haycock / Tom Rider +44 20 7236 1010