Atalaya Mining Plc.
(“Atalaya” and/or the “Group”)
Three and nine months ended 30 September 2017 Interim Financial Statements
Atalaya Mining Plc (AIM: ATYM; TSX: AYM) with its subsidiaries is pleased to announce its unaudited quarterly results for the three and nine months ended 30 September 2017, together with the unaudited, condensed, interim consolidated financial statements.
· Copper production during Q3 2017 was a record of 10,679 tonnes, 18.0% higher than the previous quarter´s production of 9,058 tonnes. Copper production during the nine months ended 30 September 2017 (“YTD17”) was 28,542 tonnes compared with 16,728 tonnes during the nine months ended 30 September 2016 (“YTD16”).
· Ore processed during the quarter was 2,173,826 tonnes in line with prior quarter when ore processed was 2,154,907 tonnes. During YTD17 ore processed was 6,525,032 tonnes compared with 4,476,617 tonnes during YTD16.
· Copper recovery during the quarter was 85.95% slightly above the previous quarter of 85.16%. Copper recovery for YTD17 averaged 85.22% representing an improvement over 82.87% during YTD16.
· Guidance for copper production has been adjusted accordingly and is now estimated to be within the range of 36,000 to 39,000 tonnes for 2017.
Expansion of Proyecto Riotinto
· During the quarter, the study to demonstrate the feasibility of increasing mining and processing capacity beyond the current 9.5 Mtpa, to a maximum of 15.0 Mtpa at Proyecto Riotinto was finalised.
· The study has concluded the expansion is technically and financially robust. The Board is encouraged by these results and will provide further details on the expansion over the coming weeks.
· Estimated copper production of the expanded plant would reach approximately 50,000 – 55,000 tonnes per year.
· Permitting of Proyecto Touro is progressing according to schedule with the public hearing finalised at the beginning of October. The Company anticipates a period of consultation with different regulatory bodies and stakeholders which should take place over the following months.
· The technical report is progressing ahead of schedule with all efforts now concentrated on getting the report completed and ready for release during Q4 2017. The technical report is confirmed to be at pre-feasibility level of detail and in compliance with NI 43-101 guidelines.
· An exploration campaign was initiated during the quarter over the newly optioned exploration concessions around Proyecto Touro. The campaign includes an airborne VTEM geophysical survey, a detailed assessment of structural geology and a regional geochemical campaign.
· Revenues of €35.7 million for Q3 2017 compared with €27.2 million in Q3 2016. Similarly, revenues for the nine months 2017 were €114.8 million compared with €49.9 million for the same period of 2016.
· Cash costs during Q3 2017 were $2.14/lb of payable copper, an increase from cash costs of $2.07/lb of payable copper in Q2 2017. The increase was due to higher than budgeted penalties and freight costs. All-in sustaining costs (“AISC”) during Q3 2017 amounted to $2.33/lb of payable copper, an increase from $2.30/lb of payable copper during Q2 2017. Cash costs for the nine months 2017 were $2.06/lb payable copper versus $2.14/lb payable copper during the nine months 2016. AISC amounted to $2.29/lb payable copper during the nine months 2017 against $2.42/lb payable copper for the nine months 2016.
Financial Highlights (continued)
· Management expects cash costs for the year to be maintained in the range of $1.95/lb to $2.10/lb. The increase from the original estimate is mainly due to different capitalisation criteria applicable to mining stripping costs.
· Positive Earnings Before Interest, Taxation, Depreciation and Amortisation (“EBITDA”) of €9.3 million in Q3 2017 compared with €1.9 million in Q3 2016. The increase in EBITDA was a result of the increase in the volume of copper concentrate sold and higher realised copper prices. On a cumulative basis EBITDA during the nine months 2017 was €33.8 million compared with a negative EBITDA of €1.7 million during the nine months in 2016.
· Q3 2017 profit after tax amounted to €2.5 million (or 2.1 cents per share on a fully diluted basis) compared with a loss for Q3 2016 of €1.5 million (or negative 1.3 cents per share on a fully diluted basis). Profits after tax for the nine months 2017 were €13.4 million versus a loss of €8.0 million for the nine months 2016.
· Inventories of concentrate at 30 September 2017 amounted to €7.7 million.
· Working capital deficit has consistently improved over the last three quarters as a result of cash generated from operations. At the end of Q3 2017 working capital deficit was €13.3 million, down from €14.1 million at the end of Q2 2017, €20.0 million at the end of Q1 2017 and €25.4 million at 31 December 2016. Unrestricted cash balances as at 30 September 2017 amounted to €9.1 million.
· Cash flow from operating activities before changes in working capital was €8.0 million for Q3 2017 compared with a cash flow of €2.0 million during Q3 2016. Cumulative for the nine months 2017, cash flow from operating activities before changes in working capital was €32.0 compared with a negative cash flow of €1.8 million for the nine months of 2016.
· Net cash flow from operating activities after changes in working capital was €12.9 million for Q3 2017 compared with a negative cash flow of €3.4 million during Q3 2016. Net cash flow from operating activities after changes in working capital was €22.9 million for the nine months 2017 compared with €5.4 million for the nine months 2016.
· On 15 September 2017, the US$14 million copper concentrate prepayment agreement with Transamine Trading, S.A. was fully settled ahead of schedule. The Company will decide whether to extend the contract with the same terms before January 2018, as permitted under the original agreement.
· 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:
“These financial results reflect another good quarter of operations at our Riotinto mine, which gives us confidence that our annual production will be within the guidance range. We continue to advance Proyecto Riotinto to its next phase of copper production, with the expansion study now concluded with very positive results. This expansion has the potential to increase production at Riotinto to 50,000 to 55,000 tonnes per year. Proyecto Touro progresses as expected. We anticipate updating the market in Q4 2017 with the results of the technical study, ahead of schedule.”
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
This announcement contains information which, prior to its publication constituted inside information for the purposes of Article 7 of Regulation (EU) No 596/2014.
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