Cambior Inc. Reports 1996 Financial Results - All Amounts are in US Dollars - 1996 Full Year Results - Part 1 of 2 - Financial Tables to Follow.MONTREAL--(BUSINESS WIRE)--Jan. 29, 1997--Cambior Inc. (ME, TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). , AMEX AMEX See: American Stock Exchange : CBJ CBJ Columbus Blue Jackets (NHL team) CBJ Central Bank of Jordan CBJ Conflict-Directed Backjumping CBJ Circuit Board Jack CBJ Code-Breakers Journal CBJ Class Broker for Java CBJ Color Bubble Jet ) Cambior Inc. today announced its financial results for the fiscal year ended December 31, 1996. Revenue increased by 24 percent to $313.1 million compared to $252.5 million in 1995. The increase is due to the resumption RESUMPTION. To reassume; to promise again; as, the resumption of payment of specie by the banks is general. It also signifies to take things back; as the government has resumed the possession of all the lands which have not been paid for according to the requisitions of the law, and the of production at the Omai mine during the first quarter, the successful completion of the Omai mill expansion during the second half and the start-up Start-up The earliest stage of a new business venture. of operations at the Gonzague Langlois mine. During 1996, gold production increased by 13 percent to 502,000 ounces. Zinc production increased to 58,500 tonnes, copper production rose to 8,300 tonnes and Cambior's share of production from the Niobec mine was 1.1 million kg of niobium niobium (nīō`bēəm), metallic chemical element; symbol Nb; at. no. 41; at. wt. 92.9064; m.p. about 2,468°C;; b.p. 4,742°C;; sp. gr. 8.57 at 20°C;; valence +2, +3, +4, or +5. . Cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses (before changes in working capital) increased by 41 percent to $63.3 million or $1.08/share, compared to $45.0 million or $0.89/share in 1995. Net earnings amounted to $4.6 million or $0.08/share, compared to a 1995 net loss of $6.6 million or $0.13/share. In 1996, gold sales generated 87 percent of cash flow and 82 percent of net revenues. Base metals generated 13 percent of cash flow and 18 percent of net revenues. The improvement in 1996 in cash flow and net earnings is primarily due to the resumption of production at Omai, the successful completion of the Omai mill expansion and increased production from the Bouchard-Hebert mine. 1996 FOURTH QUARTER RESULTS Cambior had record gold production of 155,000 ounces in the fourth quarter of 1996. It also produced 12,700 tonnes of zinc, 2,100 tonnes of copper and 259,000 kg of niobium. Revenue doubled to $86.7 million compared to $43.9 million during the fourth quarter of 1995. Cash flow was $15.9 million or $0.28/share for the fourth quarter of 1996 compared to $2.5 million or $0.05/share for the corresponding period in 1995. Cambior had a net loss of $0.7 million or $0.01/share during the fourth quarter of 1996 compared to a net loss of $7.7 million or $0.15/share. Fourth quarter results for 1995 included the impact of the shutdown shut·down n. A cessation of operations or activity, as at a factory. shutdown Noun the closing of a factory, shop, or other business Verb shut down of the operations at Omai and the year end writedown writedown A reduction in the value of an asset carried on a firm's financial statements. For example, the firm's accountants, believing the inventory is overvalued, may decide to take a writedown by reducing inventory valuation. of two underperforming mining assets. Despite the considerable improvement in 1996, performance during the fourth quarter of 1996 was weaker than the third quarter due to lower gold prices and a number of other factors: weak zinc markets, higher mining dilution Dilution A reduction in earnings per share of common stock that occurs through the issuance of additional shares or the conversion of convertible securities. Notes: Adding to the number of shares outstanding reduces the value of holdings of existing shareholders. and the subsequent suspension of operations at the Gonzague Langlois mine, increased depreciation costs associated with the closure of the Chimo mine in December 1996 and the planned closure of the Silidor mine in mid-1997 as well as the general impact of higher fuel prices on operating costs operating costs npl → gastos mpl operacionales . GOLD HEDGING PROGRAM Although the gold market weakened weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. toward year end, Cambior's
hedging program contributed to the increase in revenue by generating an
average realized price of $423/ounce of gold for a premium of $35 over
the average 1996 market price of $388/ounce. The company realized an
average price of $405/ounce for its fourth quarter gold production for a
$29 premium over the average market price of $376/ounce. At 1996 year
end, the gold hedging program had a net position ensuring a minimum
price of $462/ounce on 410,000 ounces of gold over the next five years.1997 OUTLOOK Production Target Cambior has set a 1997 production target of 550,000 ounces of gold, an increase of 10 percent over 1996 production. The Omai mine will benefit from a full year of operation of the mill expansion that has increased milling capacity from 12,000 tonnes/day to an average of 20,000 tonnes/day. A 1997 production target of 340,000 ounces has been set at Omai. Reserve Updates and Exploration During 1996, Cambior's gold mining reserves grew by 9 percent to 6.1 million ounces in situ In place. When something is "in situ," it is in its original location. . Copper reserves are estimated at 11.2 million tonnes or 25 billion lb of copper in situ and zinc reserves are estimated at 1.2 million tonnes or 2.7 billion lb of zinc in situ. In 1997, the company has considerably increased its total budget for exploration to $18 million compared to $12 million in 1996. Exploration activities will target existing properties at Omai (including the Quartz quartz, one of the commonest of all rock-forming minerals and one of the most important constituents of the earth's crust. Chemically, it is silicon dioxide, SiO2. Hill and Omai River concessions that were recently granted prospecting licences), the high gold potential of the Doyon and Mouska mines and the areas surrounding sur·round tr.v. sur·round·ed, sur·round·ing, sur·rounds 1. To extend on all sides of simultaneously; encircle. 2. To enclose or confine on all sides so as to bar escape or outside communication. n. the Bouchard-Hebert mine. Prospective gold exploration activities will concentrate on high potential properties in Mexico, the Guiana Shield The Guiana[1] Shield (Spanish: Guayana) is one of the three cratons of the South American Plate. It is a 1.7 billion year old Precambrian geological formation in northeast South America that forms a portion of the northern coast. and the Peruvian Cordillera cor·dil·le·ra n. An extensive chain of mountains or mountain ranges, especially the principal mountain system of a continent. [Spanish, from cordilla, diminutive of cuerda, cord . Investment Program Capital expenditures of $140 million are budgeted for 1997 to support the eventual start-up of construction on the Carlota project ($80 million), for ongoing expenditures on producing assets ($40 million) and development projects ($20 million). DEVELOPMENT PROJECTS The first half of 1997 will be very active with the completion of feasibility studies The analysis of a problem to determine if it can be solved effectively. The operational (will it work?), economical (costs and benefits) and technical (can it be built?) aspects are part of the study. Results of the study determine whether the solution should be implemented. on major projects at El Pachon, La Granja La Granja, Spain: see San Ildefonso. , Gross Rosebel and Metates. At the Gross Rosebel project, the company expects drilling results to confirm an increase in gold mining reserves to our target of 2 million ounces for the project. At El Pachon, the feasibility study will be completed on the basis of the recently announced reserves of 882 million tonnes grading 0.62 percent copper. At La Granja, an important increase in proven and probable mining reserves is expected with the completion of a reserve update in the first quarter. STRATEGIC OVERVIEW Cambior President and Chief Executive Officer, Louis P. Gignac, says "We expect stronger financial results in 1997 based on an increase in gold production to 550,000 ounces and full sustainable levels of production for all of our major operations. By mid-year, with the benefit of the completed feasibility studies on our major projects, we will be in a better position to establish their economic values and to define the optimum program of development within Cambior's operating and financial capabilities. To ensure future growth, we will also continue to focus on the long term development of gold operations by increasing our efforts and investments in exploration activities." Cambior Inc. is an international diversified diversified (di·verˑ·s gold producer with operations, development projects and exploration activities in Canada, the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , Mexico, Guyana, Suriname, Peru, Argentina and other countries in the Americas. Cambior shares trade on the Toronto, Montreal and the American (AMEX) stock exchanges under the symbol "CBJ". -0-
HIGHLIGHTS
CAMBIOR INC.
FOURTH QUARTER
-- Record gold production of 155,000 ounces
-- The Omai mill operated at an average rate
of 20,500 tonnes/day to produce 93,000 ounces
of gold
-- The gold hedging program generated a $29 premium
per ounce over the average market price
SHORT-TERM OUTLOOK
-- 1997 production targets of 550,000 ounces of gold,
54,700 tonnes of zinc and 8,200 tonnes of copper
-- 50 percent increase in funds budgeted for gold
exploration activities
-- Completion of feasibility studies during the first
half of 1997 for the El Pachon, La Granja, Gross Rosebel
and Metates projects
Fourth Quarter Twelve months
ended ended
December 31, December 31,
All amounts are
in in US dollars 1996 1995 1996 1995
______ ______ ______ ______
RESULTS (in millions)
Total revenues 86.7 43.9 313.1 252.5
Net earnings (Net loss) (0.7) (7.7) 4.6 (6.6)
Cash flow from operations (1) 15.9 2.5 63.3 45.0
______ _____ _____ ______
PER COMMON SHARE ($)
Earnings (Loss) (0.01) (0.15) 0.08 (0.13)
Cash flow from operations (1) 0.28 0.05 1.08 0.89
Weighted average number
of common shares outstanding
(in millions) (2) 60.1 52.0 58.8 50.4
______ _____ _____ ______
GOLD PRODUCTION
Number of ounces (000) 155 67 502 446
Direct mining costs
($ per ounce) 254 266 257 279
Cambior's selling price
($ per ounce) 405 426 423 420
Market price ($ per ounce) 376 385 388 384
______ _____ _____ ______
FINANCIAL POSITION
(in millions)
December 31, 1996 December 31, 1995
Cash 111.4 62.5
Total assets 802.4 710.6
Net debt 88.1 139.6
Shareholders' equity 547.8 434.5
_____ _____
(1) Before changes in working capital items. (2) As at December 31, 1996, Cambior had a total of 60 million common shares outstanding. CONTACT: Cambior Inc. Geoffrey King Geoffrey King may refer to
514/ 878-3324 (FAX) http://www.cambior.com info@cambior.com or Cambior Inc. Robert LaValliere (Investor Relations Investor relations The process by which the corporation communicates with its investors. ), 514/ 878-1282 514/ 878-3324 (FAX) http://www.cambior.com info@cambior.com or Cambior Inc. Victoria Putnam (Investor Relations), 514/ 878-3166 514/ 878-0635 (FAX) http://www.cambior.com info@cambior.com |
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