GOLD (USD): 1214.20 0.21%
SILVER (USD): 14.2900 1.20%
RUB | USD: 66.6159 1.3816
CAD | USD: 0,7797 0,0008
NEX: MGZ.H
SPOT (CAD): 0.045 0.00 (0.00%)

Mangazeya Mining Announces Filing of its Q2 and six months 2018 Financial Statements and MD&A Quarterly Highlights

Publish date: 29.08.2018

Print version

TORONTO, ONTARIO, August 29, 2018 – Mangazeya Mining Ltd. (“Mangazeya” or the “Company”) (NEX: MGZ.H) announced the filing of its unaudited interim condensed financial statements (“Financial Statements”), management’s discussion and analysis (“MD&A”) – quarterly highlights (“QH for the second quarter and the six months ended June 30, 2018. All figures are quoted in Canadian dollars unless otherwise indicated.

SECOND QUARTER AND SIX MONTHS 2018 HIGHLIGHTS

2Q 2018 2Q 2017 Change % H1 2018 H1 2017 Change %
Operational highlights
Gold production, ounces 5,781 6,758 (977) (14%) 6,972 8,357 (1,385) (17%)
Gold sales, ounces 2,669 4,841 (2,172) (45%) 3,621 6,195 (2,574) (42%)
Ore mined, tones 372,537 247,555 (2,172) 50% 497,220 520,359 (23,139) (4%)
Stripping ratio, m3/t 4.22 4.34 (0.12) (3%) 5.44 4.64 0.80 17%
Ore stacked, tones 356,004 479,837 (123,833) (26%) 356,004 516,938 (160,934) (31%)
Ore grade in ore stacked, g/t 1.34 1.20 0.14 12% 1.34 1.19 0.15 13%
Financial highlights
Revenue 4,591 8,156 (3,565) (44%) 6,309 10,539 (4,320) (40%)
Adjusted EBITDA (6,054) 995 (7,049) (708%) (10,954) (1,319) (9,635) (730%)
Total cash cost per ounce (TCC), CAD 1,044 1,132 (88) (8%) 1,166 1,110 56 5%
Average gold price, CAD 1,664 1,708 (45) (3%) 1,692 1,674 18 1%
Cash balance 706 976 (270) (28%) 706 976 (270) (28%)
Cash flow (used in)/received from operating activities before changes in working capital (7,486) 993 (8,479) (854%) (13,185) (1,320) (11,865) (899%)
Cash flow (used in)/provided by financing activities 5,791 5,354 437 8% 18,805 26,429 (7,624) (29%)
Cash flow (used in)/provided by investing activities (3,346) (3,780) 434 11% (7,686) (17,126) 9,440 55%

  • Gold production was 6.97 koz in H1 2018, the difference of 17% YoY (Savkinskoye – 6,76 koz, Kochkovskoye – 0,21 koz). The difference at Savkinskoye deposit resulted from the decrease in ore stacked YoY and by the changed process resulting in the increased metal grade in product solutions and reduced dilution factor. In Q2 2018, gold production was 5.78 koz (Savkinskoye – 5,57 koz, Kochkovskoye – 0,21 koz)., the difference of 14% YoY;
  • Revenue was $6.3 million for H1 2018, a 40% YoY change. The company sold 3.62 koz of gold and 8.6 koz of silver (H1 2017 – 6.19 koz of gold and 7.5 koz of silver) at Savkinskoye deposit. Revenue changed by 44% for Q2 2018, the company sold 2.67 koz of gold and 2.9 koz of silver (Q2 2017 – 4,84 koz of gold). The average gold price increased from $1,674 in H1 2017 to $1,692 in H1 2018 per ounce or by 1% (from 1,255 USD to 1,324 USD per ounce or 6%);
  • The total cash cost (TCC) per ounce of gold sold equals to $1,166 per ounce (US$ 912) for H1 2018 compared to $1,110 per ounce (US$ 832), the difference of 5% YoY (6% in US$ YoY). The difference mainly resulted from the decrease in gold production and in gold sales. TCC in Q2 2018 changed by 8% YoY;
  • Gross profit margin changed from 27% in H1 2017 to 18% in H1 2018. The gross profit margin in Q2 2018 was 26% comparing to 24% in Q2 2017. Gross profit was $1.2 million for H1 2018, the difference of 59% YoY, the reduction was caused mainly by the decrease in revenue and gold sold;
  • Administrative expenses were $6.1 million for H1 2018, the difference of 61% YoY. The difference was due to active construction and exploration works in Nasedkino and Zolinsko-Arkiinskaya areas and resulting increase in management service fees;
  • Adjusted EBITDA for H1 2018 decreased to negative $10.9 million compared to negative adjusted EBITDA $1.3 million in H1 2017. Adjusted EBITDA for Q2 2018 equal to negative $6.1 million compared to positive adjusted EBITDA $1 million in Q2 2017;
  • The finance expenses for H1 2018 changed by 114% YoY ($1 million in H1 2018 and $0.5 million in H1 2017) mainly because of the financial obligations under the loan agreement with VTB Bank (PJSC). The finance expenses for Q2 2018 changed by 37% YoY ($0.2 million in Q2 2018 and $0.3 million in Q2 2017);
  • The net loss for H1 2018 was $11.8 million comparing with the net loss of $1.9 million in H1 2017. The net loss for Q2 2018 was $6.6 million comparing with the net loss of $0.6 million in Q2 2017.

Cash flow and capital resources:

  • For H1 2018, cash used in operating activity before changes in working capital was $13.2 million in comparison with cash used in H1 2017 of $1.3 million. Cash used in investing activities in H1 2018 was $7.7 million as compared to $17.1 million in H1 2017. Cash received from financing activities in H1 2018 was $18.8 million compared to cash received from financing activities of $26.4 million in H1 2017;
  • For Q2 2018, cash used in operating activity before changes in working capital was $7.5 million in comparison with cash received from operating activities Q2 2017 of $0.9 million. Cash used in investing activities for Q2 2018 was $3.3 million as compared to $3.8 million for Q2 2017. Cash received from financing activities in Q2 2018 was $5.8 million compared to cash received from financing activities of $5.3 million in Q2 2017;
  • For H1 2018 the Company invested $11.9 million ($19.2 million in H1 2017). In property, plant and equipment – $6.7 million ($18.5 million in H1 2017); in Mine properties – $2.7 million ($0.2 million in H1 2017); in Exploration and evaluation assets – $2.4 million ($0.6 million in H1 2017).

The Financial Statement and MD&A are available on Mangazeya’s website at http://mangazeyamining.ru/ and have been filed on SEDAR at www.sedar.com.

About Mangazeya Mining Ltd.

Mangazeya Mining Ltd. is a NEX-listed mining and exploration company, focused on the development of mineral resources in the Russian Federation.

Contact:
Georgy Kandelaki
Corporate Secretary
Mangazeya Mining Ltd.
g.kandelaki@mangazeya.ru