TORONTO, Dec. 21, 2018
All Amounts in US Dollars Unless Otherwise Stated
Fiscal 2018 Achievements:
Fiscal 2019 Outlook:
TORONTO, Dec. 21, 2018 /PRNewswire/ -- Orvana Minerals Corp. (TSX:ORV) (the "Company" or "Orvana") announced today financial and operational results for the fourth quarter ("Q4 2018") and for the fiscal year ended September 30, 2018 ("Fiscal 2018). The Company is also providing financial and operational updates for its El Valle and Carlés Mines (collectively, "El Valle") operations in northern Spain and for its Don Mario Mine operations in Bolivia.
The audited consolidated financial statements for Fiscal 2018 ("2018 Financials") and Management's Discussion and Analysis related thereto ("2018 MD&A") are available on SEDAR and on the Company's website at www.orvana.com.
The Company is pleased to report the following positive developments in Fiscal 2018:
Juan Gavidia, CEO of Orvana Minerals stated: "We have achieved a number of key operational successes that ensure the sustainability of Orvana as a 100,000 oz plus gold producer. Our Spanish and Bolivian teams, supported by prudent capital investments and renewed technical talent, have worked diligently on mining efficiencies to ensure increased production and productivities. Our AISC will continue to be a hard core target in Fiscal 2019, with improvement opportunities expected to come from continued higher-grade ore at El Valle, as well as increased recoveries and operational productivity at both sites." Mr. Gavidia further stated: "At El Valle, we made excellent strides on mechanical advance, mastering the challenging higher-grade oxides areas. While, at Don Mario, plant recoveries continued to exceed expectations, being at 92% by Fiscal 2018 year-end. With the transition to Cerro Felix pit now completed, Don Mario unitary costs have stabilized to former lower levels. Both, El Valle and Don Mario are also enhancing their regional exploration drives to fulfill Orvana's strategic growth."
Strategy and Outlook for Fiscal 2019
The Company continues to pursue its objectives of optimizing production, lowering unitary costs, maximizing free cash flow, and extending life-of-mine of operations while increasing their output. It continues to seek strategic and transformative transactions to enhance its profile and longevity, including the review of other potential exploration projects, mainly focused in South America, which could be aligned with the Company's strategy of adding to reserves and resources.
At El Valle, the primary objective is to continue increasing higher-grade oxides mining. For that purpose the Company is conducting additional geological and geotechnical work, to increase mining and mine plan reliability.
At Don Mario, ore will continue to be sourced from Cerro Felix pit and processed at the higher recovery rate achieved the previous year. Next focus is the processing of the oxides stockpile, which will potentially provide a three-year life of mine extension. The metallurgical solution goes through the development of a SART circuit which is in the process of review for engineering and project financing purposes.
New Credit Facility
In August 2016, Orvana entered into a $12.5M copper concentrates and gold doré Prepayment Facility with Samsung C&T. Proceeds of this Facility were used for mine development and infrastructure upgrades at El Valle, both, contributors to present good operational performance. Principal outstanding was $9.118 million at the end of Fiscal 2018.
The Company has been evaluating alternatives to replace the Samsung Facility in order to extend the repayment period and reduce its interest rate. The Company has recently obtained, through its wholly-owned subsidiary OroValle, approval from three Spanish financial institutions to access a syndicated credit facility (the "New Facility") for €6 million. The closing of the New Facility is subject to the concurrent completion of the early repayment of the Samsung Facility, the release of guarantees and collateral pledged in favour of Samsung, and the execution of applicable legal documentation. The Company has an excellent relationship with Samsung C&T, which has been very cooperative throughout the Prepayment Facility, and looks forward to maintaining this after its replacement.
The New Facility will extend the repayment period from one year (Samsung Facility), to four. The close of the New Facility is expected by early 2019. Once closed, the New Facility will provide the Company with improved financial metrics to fulfill its operational strategy.
Fiscal 2019 guidance and Fiscal 2018 results are:
El Valle Production
55,000 – 62,000
62,000 – 68,000
Copper (million lbs)
4.9 – 5.3
3.2 – 3.6
Don Mario Production
45,000 – 48,000
38,000 – 42,000
Copper (million lbs)
100,000 – 110,000
100,000 – 110,000
Copper (million lbs)
8.0 – 8.4
3.2 – 3.6
Total capital expenditures (million $)
21 – 24
12 – 13
Cash operating costs (by-product) ($/oz gold) (1) (2)
1,000 – 1,050
950 – 1,050
All-in sustaining costs (by-product) ($/oz gold) (1) (2)
1,250 – 1,300
1,150 – 1,250
FY 2018 Revised Guidance assumptions for COC and AISC include by-product commodity prices of $2.75 per pound of copper and an average Euro to US Dollar exchange of 1.18 in the fourth quarter of fiscal 2018.
FY 2019 guidance assumptions for COC and AISC include by-product commodity prices of $2.75 per pound of copper and an average Euro to US Dollar exchange of 1.16.
Selected Operational and Financial Information
Average realized price ($/oz)
Production ('000 lbs)
Sales ('000 lbs)
Average realized price ($/lb)
Financial Performance (in '000 $, except per share)
Net loss per share (basic/diluted) ($)
Operating cashflow bef. non-cash w/c changes
Ending cash and cash equivalents
Cash operating costs (by-product) ($/oz gold)
All-in sustaining costs (by-product) ($/oz gold)
Earnings before interest, taxes, depreciation and amortization ("EBITDA"), cash operating costs and all-in sustaining costs are non-IFRS performance measures.
Capital expenditures are presented in the consolidated cash flows in the Audited Financials on a cash basis.
About Orvana Minerals Orvana is a multi-mine gold-copper-silver company. Orvana's operating assets consist of the producing El Valle and Carlés gold-copper-silver mines in northern Spain and the producing Don Mario gold-silver operations in Bolivia. Additional information is available at Orvana's website (www.orvana.com).
Cautionary Statements - Forward-Looking Information
Certain statements in this information constitute forward-looking statements or forward-looking information within the meaning of applicable securities laws ("forward-looking statements"). Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions, potentials, future events or performance (often, but not always, using words or phrases such as "believes", "expects", "plans", "estimates" or "intends" or stating that certain actions, events or results "may", "could", "would", "might", "will" or "are projected to" be taken or achieved) are not statements of historical fact, but are forward-looking statements.
The forward-looking statements herein relate to, among other things, Orvana's ability to achieve improvement in free cash flow; the potential to extend the mine life of El Valle and Don Mario beyond their current life-of-mine estimates including specifically, but not limited to in the case of Don Mario, the mining of the Cerro Felix deposit, the processing of the mineral stockpiles (including the implementation of the SART circuit) and the reprocessing of the tailings material; Orvana's ability to optimize its assets to deliver shareholder value; the Company's ability to optimize productivity at Don Mario and El Valle; estimates of future production, operating costs and capital expenditures; mineral resource and reserve estimates; statements and information regarding future feasibility studies and their results; future transactions; future metal prices; the ability to achieve additional growth and geographic diversification; future financial performance, including the ability to increase cash flow and profits; future financing requirements; mine development plans; and closing the New Facility.
Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by the Company as of the date of such statements, are inherently subject to significant business, economic and competitive uncertainties and contingencies. The estimates and assumptions of the Company contained or incorporated by reference in this information, which may prove to be incorrect, include, but are not limited to, the various assumptions set forth herein and in Orvana's most recently filed Management's Discussion & Analysis and Annual Information Form in respect of the Company's most recently completed fiscal year (the "Company Disclosures") or as otherwise expressly incorporated herein by reference as well as: there being no significant disruptions affecting operations, whether due to labour disruptions, supply disruptions, power disruptions, damage to equipment or otherwise; permitting, development, operations, expansion and acquisitions at El Valle and Don Mario being consistent with the Company's current expectations; political developments in any jurisdiction in which the Company operates being consistent with its current expectations; certain price assumptions for gold, copper and silver; prices for key supplies being approximately consistent with current levels; production and cost of sales forecasts meeting expectations; the accuracy of the Company's current mineral reserve and mineral resource estimates; labour and materials costs increasing on a basis consistent with Orvana's current expectations; and closing the New Facility.
A variety of inherent risks, uncertainties and factors, many of which are beyond the Company's control, affect the operations, performance and results of the Company and its business, and could cause actual events or results to differ materially from estimated or anticipated events or results expressed or implied by forward looking statements. Some of these risks, uncertainties and factors include fluctuations in the price of gold, silver and copper; the need to recalculate estimates of resources based on actual production experience; the failure to achieve production estimates; variations in the grade of ore mined; variations in the cost of operations; the availability of qualified personnel; the Company's ability to obtain and maintain all necessary regulatory approvals and licenses; the Company's ability to use cyanide in its mining operations; risks generally associated with mineral exploration and development, including the Company's ability to continue to operate the El Valle and/or Don Mario and/or ability to resume long-term operations at the Carlés Mine; the Company's ability to successfully implement the SART circuit to process the current oxides stockpiles at Don Mario; the Company's ability to acquire and develop mineral properties and to successfully integrate such acquisitions; the Company's ability to execute on its strategy; the Company's ability to obtain financing when required on terms that are acceptable to the Company; challenges to the Company's interests in its property and mineral rights; current, pending and proposed legislative or regulatory developments or changes in political, social or economic conditions in the countries in which the Company operates; general economic conditions worldwide; and the risks identified in the Company's disclosures. This list is not exhaustive of the factors that may affect any of the Company's forward-looking statements and reference should also be made to the Company's Disclosures for a description of additional risk factors.
Any forward-looking statements made in this information with respect to the anticipated development and exploration of the Company's mineral projects are intended to provide an overview of management's expectations with respect to certain future activities of the Company and may not be appropriate for other purposes.
Forward-looking statements are based on management's current plans, estimates, projections, beliefs and opinions and, except as required by law, the Company does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change. Readers are cautioned not to put undue reliance on forward-looking statements.
The forward-looking statements made in this information are intended to provide an overview of management's expectations with respect to certain future operating activities of the Company and may not be appropriate for other purposes.