Unaudited, Condensed, Interim, Consolidated Financial Statements for the period ended 30 September 2019

21 November, 2019

Atalaya Mining Plc (AIM: ATYM; TSX: AYM), the European mining and development company, is pleased to announce its quarterly results for the period ended 30 September 2019 (“Q3 2019”), together with the Unaudited, Condensed, Interim, Consolidated Financial Statements.

Financial Highlights

Quarter ended 30 September   Q3 2019 Q3 2018   Nine months ended

30 Sept 2019

Nine months ended

30 Sept 2018

Revenues from operations €k 44,383 42,811   139,165 144,354
Operating costs €k (34,514) (35,152)   (97,752) (102,311)
EBITDA €k 9,869 7,659   41,413 42,043
Profit for the period €k 6,933 3,133   27,937 27,625
Earnings per share € cents/share 5.1 2.2   20.5 20.4
     
Cash flows from operating activities €k 16,487 14,937   31,457 44,151
Cash flows used in investing activities €k (13,115) (20,414)   (45,390) (41,704)
Cash flows (used)/from financing activities €k (158)   (430) 593
     
Average realised copper price $/lb 2.68 2.89   2.76 3.02
     
Cu concentrate produced (tonnes) 45,458 44,562   137,281 134,130
Cu production (tonnes) 10,568 11,055   31,675 30,942
Cash costs $/lb payable 1.92 1.88   1.85 2.00
All-In Sustaining Cost $/lb payable 2.25 2.13   2.12 2.35

 

  • Revenues for Q3 2019 were €44.4 million compared with €42.8 million for the three month period ended 30 September 2018 (“Q3 2018”). The higher revenues were the result of increased volumes sold during Q3 2019 and stronger average US Dollar rates against the Euro. Revenues for the nine month period ended 30 September 2019 (“YTD 2019”) of €139.2 million were lower than the €144.4 million reported for the nine month ended 30 September 2018 (“YTD 2018”) owing mainly to c. 9% lower realised copper prices throughout 2019.
  • Operating costs (including administrative, exploration and care and maintenance costs) during Q3 2019 were €34.5 million compared with €35.2 million in Q3 2018. Operating costs for the nine month ended 30 September 2019 amounted to €97.8 million compared with €102.3 million during the same period in 2018. Lower costs were driven by efficiencies in mining, maintenance costs and technical services.
  • Cash costs during Q3 2019 were $1.92/lb of payable copper, higher than the cash costs of $1.88/lb in Q3 2018 as a result of a reduction in copper produced during Q3 2019. All-in Sustaining Costs (“AISC”) during Q3 2019 amounted to $2.25/lb of payable copper, higher than $2.13/lb in the same quarter last year. Cash costs for YTD 2019 were $1.85/lb of payable copper versus $2.00/lb payable copper during Q3 2018. AISC for YTD 2019 and YTD 2018 were $2.12/lb and $2.35/lb, respectively.
  • As previously announced, the Company has carried out a cost analysis during 2019 and confirms a reduced cash cost and AISC 2019 guidance. Cash costs and AISC expected for 2019 are within the range $1.85 – $1.95/lb and $2.10 – $2.25/lb, respectively.
  • The Company is currently reviewing its sustaining Capex commitments and evaluating several projects as part of its capex programme seeking further reductions to its operating costs.
  • Higher EBITDA of €9.9 million in Q3 2019 compared with €7.7 million in Q3 2018 was driven by lower operating costs and higher revenues. On an accumulative basis, EBITDA during the nine month period ended 30 September 2019 was €41.4 million compared with €42.0 million in the same period last year, as lower copper prices were largely offset by lower operating costs.
  • Q3 2019 profit after tax amounted to €6.9 million (or 5.1 cents basic earnings per share) compared with a profit for Q3 2018 of €3.1 million (or 2.2 cents basic earnings per share). Profit after tax for the nine month period ended 30 September 2019 was €27.9 million compared with €27.6 million during the same period in
  • At 30 September 2019, the Company reported a working capital surplus of €2.0 million, a decrease from the €8.4 million surplus reported at 31 December 2018. This was mainly due to a reduction in cash balances as result of the investment in the Expansion Project. The working capital for Q3 2019 assumes that the entirety of the Astor Deferred Consideration is considered a non-current liability (please refer to note 7 for further detail). Unrestricted cash balances as at 30 September 2019 amounted to €18.5 million.

 

Operational Highlights

Proyecto Riotinto

  • Copper production during Q3 2019 was 10,568 tonnes, a decrease of 4.4% from the 11,055 tonnes produced during Q3 2018. During the nine month period ended 30 September 2019 copper production was 31,675 tonnes, a 2.4% increase from the 30,942 tonnes produced during the same period in 2018.
  • Ore processed during Q3 2019 was 2,563,594 tonnes, an increase on Q3 2018 when ore processed amounted to 2,491,403 tonnes. Total ore processed during the nine month period ended 30 September 2019 was 7,575,130 tonnes compared with 7,188,747 tonnes processed in the same period last year.
  • Copper recovery during the quarter was 87.38%, lower than 88.40% achieved in Q3 2018. Copper recovery for the nine month period ended 30 September 2019 averaged 88.77% representing an improvement over 88.06% during the same period in 2018.
  • As announced on 17 October 2019, the Company reviewed its production guidance for 2019 with a reduction in expected ore processed to 10.6Mt and copper produced expected to be in the range of 44,000 to 45,000 tonnes.

 

Expansion to 15Mtpa at Proyecto Riotinto (“Expansion Project”)

  • Electricity supplier Endesa has finalised the work required and the additional electricity capacity is now available at site.
  • As announced in October 2019, the cold mechanical commissioning and the new installation (SAG Mill and auxiliary mills) were completed during Q3 2019 and the Company is now gradually ramping up and fine tuning to achieve a full production rate during Q4 2019.
  • All other equipment for the Expansion Project (new primary crusher, the new flotation cells and concentrate handling areas) has been commissioned and incorporated into the processing plant circuit and it is running in steady state.

 

Proyecto Touro

  • During the quarter, the Company continued addressing additional information requests from administrative bodies. Atalaya addressed comments from Aguas de Galicia, Natural Heritage and the General Directorate of Mines.

 

Legal updates

On 29 March 2019, the Company announced that it had received notification from the Supreme Court in Spain that it did not have jurisdiction over the appeal made by the Junta de Andalucía (“JdA”) and therefore the announced ruling by the Tribunal Superior de Justicia de Andalucía (“TSJA”) dated 26 September 2018 remains valid.

On 26 April 2019, the Company announced that a judgment relating to the Mining Permits to operate Proyecto Riotinto (the “Mining Permits”) was handed down by the TSJA. The TSJA declared the Mining Permits are linked to the environmental permits, ruled by the same tribunal in September 2018.  The new ruling on the Mining Permits is based on the requirement to have an environmental permit before issuing Mining Permits and therefore invalidates the existing mining permits. The TSJA did not accept the requests by Ecologistas en Accion (“EeA”) for the cessation of activities at the mine and an increase in the scope of the environmental plan.

On 20 November 2019, the Company received an informal notification that its appeal to the Supreme Court on the ruling handed down by the TSJA on 26 April 2019 had been rejected. The Company has been advised by its lawyers that the rejection has no impact over the Company’s legal status quo.

The JdA is undergoing the process to resolve the previously reported administrative issues identified by the TSJA relating to the Environmental and Mining Permits. The Company continues operating the mine normally and remains confident that the ongoing process carried out by the JdA will not impact its operations at Proyecto Riotinto.

Alberto Lavandeira, CEO commented:

“We are pleased to demonstrate another strong quarter of operations at Proyecto Riotinto which was achieved at the same time as completing and testing of the new 15Mtpa expansion, illustrating the flexibility within the plant. With the additional power supply now fully up and running we are confident that our stated production rates will be met during Q4 2019.”

 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 Elisabeth Cowell / Adam Lloyd / Tom Carnegie + 44 20 3757 6880
4C Communications Carina Corbett +44 20 3170 7973
Canaccord Genuity (NOMAD and Joint Broker) Henry Fitzgerald-O’Connor / James Asensio +44 20 7523 8000
BMO Capital Markets (Joint Broker) Tom Rider / Michael Rechsteiner +44 20 7236 1010
Peel Hunt LLP (Joint Broker) Ross Allister / David McKeown +44 20 7418 8900

 

About Atalaya Mining Plc

Atalaya is an AIM and TSX-listed mining and development group which produces copper concentrates and silver by-product at its wholly 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