Dayton Mining 1998 Financial Results and Operating Results; Dayton Mining First Quarter 1999 Operating Results.VANCOUVER Vancouver, city, Canada Vancouver, city (1991 pop. 471,844), SW British Columbia, Canada, on Burrard Inlet of the Strait of Georgia, opposite Vancouver Island and just N of the Wash. border. , British Columbia--(BUSINESS WIRE)--April 29, 1999-- Dayton Dayton, city (1990 pop. 182,044), seat of Montgomery co., SW Ohio, on the Great Miami River where it is joined by the Stillwater River; inc. 1805. It is the trade center for a fertile farm area, but is best known for its involvement with industry, invention, and Mining Corporation (AMEX AMEX See: American Stock Exchange , TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). : DAY) announces its financial and operating results for the year and quarter ended December December: see month. 31, 1998, and operating results for the first quarter 1999. All figures are in Canadian dollars Noun 1. Canadian dollar - the basic unit of money in Canada; "the Canadian dollar has the image of loon on one side of the coin" loonie dollar - the basic monetary unit in many countries; equal to 100 cents unless otherwise stated. 1998 Financial Review Gold production for 1998 from Dayton's This article is about the defunct chain of department stores. For the former parent company formed by the 1969 merger with Hudson's, see Target Corporation. Minneapolis-based Dayton's was among the nation's leading department stores for nearly a century. 100% owned Andacollo Andacollo is a city in the Coquimbo Region, Chile. It is located at around . Gold Mine in Chile Chile (chĭl`ē, Span. chē`lā), officially Republic of Chile, republic (2005 est. pop. 15,981,000), 292,256 sq mi (756,945 sq km), S South America, west of the continental divide of the Andes Mts. was 92,548 ounces compared with 91,347 ounces in 1997. Gold revenues were $45.8 million in 1998 compared with $49.6 million in 1997. The reduction in gold revenues was due to the lower realized gold price in US dollars which was partially offset by the decline in the exchange rate for the Canadian dollar in 1998. Using a gold price of US$300 per ounce ounce, in zoology ounce, in zoology: see leopard. ounce, unit of measurement ounce: see English units of measurement. , Dayton has reviewed the carrying value Carrying Value Also know as "book value," it is a company's total assets minus intangible assets and liabilities, such as debt. Notes: This is different than market value, as it can be higher or lower depending on the circumstances. of its mining assets and written these assets down by $51 million in 1998. Marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has have also been written down by $805,000 in 1998. As a result the Company had a net loss for 1998 of $64.8 million or $1.73 per share (after recognizing the effect of the equity accretion The act of adding portions of soil to the soil already in possession of the owner by gradual deposition through the operation of natural causes. The growth of the value of a particular item given to a person as a specific bequest under the provisions of a will between the on the convertible debentures Convertible Debenture Any type of debenture that can be converted into some other security. Notes: For example, a convertible bond can be converted into stock. ) compared with a net loss of $27.6 million or $0.78 per share in 1997. Before writedowns, the net loss for 1998 was $13.0 million compared with $2.6 million in 1997. 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 for 1998 was $4.0 million ($0.10 per share), compared with $10.5 million ($0.26 per share) in 1997. Cash operating costs operating costs npl → gastos mpl operacionales were US$241 per ounce of gold for 1998 compared with US$251 per ounce in 1997. The Company realized an average gold price of US$336 per ounce in 1998 compared with US$402 per ounce in 1997. Dayton's gold hedging program for 1999 consists of 84,000 ounces of puts at US$340 per ounce. 1998 Operations Review During 1998, the Andacollo Gold Mine in Chile produced 92,548 ounces of gold at a cash cost of US$241 per ounce. Due to a hedging program of puts the realized gold price for 1998 was US$336 per ounce. The Andacollo Gold Mine achieved record monthly production and record quarterly production during the fourth quarter of 1998, producing 30,558 ounces of gold at a cash operating cost of US$209 per ounce. The comprehensive review and subsequent improvements in sample preparation and grade control procedures initiated at Andacollo during the third quarter yielded significant improvements in gold production in the fourth quarter of 1998. This increase in gold production was also due to improvements in crushing crushing deaths of newborn animals, especially those in litters, caused by the mother lying on them accidentally. Contributed to by weakness of the neonate or awkward accommodation. A problem in piglets and puppies. Called also overlying. system operating time and pit design and mine planning activities. Dayton is forecasting 1999 gold production of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 138,000 ounces at a cash cost of US$190 per ounce. Ore will continue to be mined from the Socorro Socorro is a Portuguese and Spanish word that means 'aid', by providing help or relief. It is a cognate of the word succor (or succour) in the English language.
First Quarter 1999 Operations and Corporate Review During the first quarter of 1999 the Andacollo Gold Mine produced 32,882 ounces of gold at cash operating costs of US$199 per ounce. A total of 6.74 million tonnes of material was mined during the first quarter of 1999, of which 1.53 million tonnes of ore grading 0.97 grams of gold per tonne tonne measure of weight or mass; 1 tonne=1000 kg. See also ton. (gpt), were crushed and stacked Stacked is an American television sitcom that premiered on Fox on April 13, 2005. On May 18, 2006, Stacked was cancelled, leaving five episodes unaired in the United States. The last episode aired on January 11, 2006. on the leach leach v. leached, leach·ing, leach·es v.tr. 1. To remove soluble or other constituents from by the action of a percolating liquid. 2. pad. In 1997 the Company issued a US$69 million 7% convertible debenture, the proceeds from which have been used primarily to service the bank debt, support capital expenditures at the mine and service interest on the debentures of approximately US$4.8 million per annum Per annum Yearly. . Due to the current low gold price environment the Company's directors proposed to its debentureholders and shareholders a transaction to convert all the US$69 million of debentures into 310,500,000 common shares of the Company. This transaction was approved on March 31, 1999 and all of the debentures will be exchanged for common shares by May 3, 1999. This transaction will be treated for Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. accounting purposes as a financial reorganization The process of carrying out, through agreements and legal proceedings, a business plan for winding up the affairs of, or foreclosing a mortgage upon, the property of a corporation that has become insolvent. resulting in the comprehensive revaluation Revaluation A calculated adjustment to a country's official exchange rate relative to a chosen baseline. The baseline can be anything from wage rates to the price of gold to a foreign currency. In a fixed exchange rate regime, only a decision by a country's government (i.e. of assets and liabilities of Dayton. Under these rules, the liability related to the debentures is eliminated, and all assets and liabilities will be revalued to their estimated fair values. This comprehensive revaluation of assets and liabilities will occur effective as of March 31, 1999. Bill Myckatyn, Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. of the Company states, "The positive improvements at the Andacollo operation continue to manifest manifest 1) adj., adv. completely obvious or evident. 2) n. a written list of goods in a shipment. MANIFEST, com. law. A written instrument containing a true account of the cargo of a ship or commercial vessel. 2. themselves in improved financial results. The increase in the market capitalization Market Capitalization A measure of a public company's size. Market capitalization is the total dollar value of all outstanding shares. It's calculated by multiplying the number of shares times the current market price. This term is often referred to as market cap. of the Company after the conversion of the debentures is an indicator that the market is starting to recognize the changes that have been made and will value Dayton more appropriately in the future. We are now actively seeking merger and acquisition opportunities that are available in the marketplace. With our proven development and operating expertise in South America South America, fourth largest continent (1991 est. pop. 299,150,000), c.6,880,000 sq mi (17,819,000 sq km), the southern of the two continents of the Western Hemisphere. , there are a number of strategic alternatives that may be available. We feel that there is still substantial consolidation that needs to occur in the junior gold sector and that Dayton can be a catalyst catalyst, substance that can cause a change in the rate of a chemical reaction without itself being consumed in the reaction; the changing of the reaction rate by use of a catalyst is called catalysis. to help that occur. Also, there are development projects out there that need our particular skill sets to advance." Dayton Mining Corporation holds a 100% interest in the Andacollo Gold Mine located in central Chile, and trades on both the American Stock Exchange American Stock Exchange (AMEX) Stock exchange in the U.S. Originally known as “the Curb,” it began as an outdoor marketplace in New York City c. 1850. It moved indoors to its present location in the Wall Street area in 1921. (AMEX) and Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. (TSE) under the trading symbol Trading symbol See: Ticker symbol DAY. "Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. " Statement: The statements, which are not historical facts contained in this release, are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that involve risks and uncertainties that could cause actual results to differ materially from targeted results. These risks and uncertainties include but are not limited to significant declines in precious metals Precious Metals Valuable metals such as gold, iridium, palladium, platinum, and silver. Notes: Investing in precious metals can be done either by purchasing the physical asset, or by purchasing futures contracts for the particular metal. prices; currency fluctuations; increases in production costs; differences in ore grades Ore grade is a measure that describes the concentration of a valuable natural material (such as metals or minerals) in its surrounding ore. Ore grade is used to assess the economic feasibility of a mining operation: the cost of extracting a natural material from its ore is directly , recovery rates, and tonnes mined from those expected; changes in mining, or heap leaching Heap leaching is an industrial mining process to extract precious metals and copper compounds from ore. Process The mined ore is crushed into small chunks and heaped on an impermeable plastic and/or clay lined leach pad where it can be irrigated with a leach solution to rates from currently planned rates; the results of current exploration activities and new opportunities; and other factors detailed in the company's filings with the U.S. Securities and Exchange Commission. -0-
Consolidated Balance Sheets
in thousands of Canadian dollars
AT DECEMBER 31 1998 1997
$ $
ASSETS -----------------
CURRENT ASSETS
Cash and short-term investments (note 7) 31,626 95,237
Investments in marketable securities(note 3) 533 839
Bullion settlements receivable 2,602 2,950
Accounts receivable 2,665 3,841
Inventories (note 4) 13,760 9,521
-----------------
Total current assets 51,186 112,388
PROPERTY, PLANT AND EQUIPMENT (note 5) 68,919 105,729
DEFERRED CHARGES AND OTHER ASSETS (note 6) 4,460 4,826
-----------------
124,565 222,943
=================
LIABILITIES
CURRENT LIABILITIES
Accounts payable and accrued liabilities 10,813 9,812
Bank loan - current portion (note 7) 24,787 61,307
Capital leases payable - current portion
(note 8) 5,168 3,596
Convertible debentures - current portion
(notes 9 and 20) 3,697 6,673
-----------------
Total current liabilities 44,465 81,388
-----------------
LONG-TERM LIABILITIES
Bank loan (note 7) 2,552 -
Capital lease payable (note 8) 8,143 7,233
Convertible debentures (notes 9 and 20) 18,990 19,605
Accrued closure costs 2,087 1,540
-----------------
Total long-term liabilities 31,772 28,378
-----------------
Total liabilities 76,237 109,766
-----------------
SHAREHOLDERS' EQUITY
SHARE CAPITAL (note 9) 90,714 90,714
1998 - 40,856,779 common shares
1997 - 40,856,779 common shares
CONVERTIBLE DEBENTURES (notes 9 and 20) 73,810 67,904
DEFICIT (116,196) (45,441)
-----------------
Total shareholders' equity 48,328 113,177
-----------------
124,565 222,943
=================
Consolidated Statements of Loss
in thousands of Canadian dollars
FOR THE YEARS ENDED DECEMBER 31 1998 1997 1996
$ $ $
-------- -------- -------
REVENUES
Gold sales 45,848 49,553 45,996
-------- -------- -------
COST OF SALES
Operating cost of sales 33,101 31,685 24,545
Depreciation, depletion and
amortization 11,774 10,555 11,104
-------- -------- -------
Total cost of sales 44,875 42,240 35,649
-------- -------- -------
973 7,313 10,347
-------- -------- -------
EXPENSES
Amortization of deferred financing costs 982 1,788 2,219
Exploration 934 813 600
Foreign exchange 1,228 (390) (52)
General and administrative expenses 7,531 4,647 4,975
Interest expense 6,065 7,979 6,934
Interest income (2,723) (4,881) (920)
Writedown of property, plant and
equipment (note 5) 51,000 24,000 -
Writedown of marketable securities 805 976 -
-------- -------- -------
Total expenses 65,822 34,932 13,756
-------- -------- -------
NET LOSS FOR THE YEAR (64,849) (27,619) (3,409)
========= ======== ========
LOSS PER SHARE, including effect of
accretion of equity component of
convertible debentures $(1.73) $(0.78) $(0.10)
========= ======== ========
Weighted average common shares
outstanding (000's) 40,857 40,854 35,477
========= ======== ========
Consolidated Statements of Deficit
FOR THE YEARS ENDED DECEMBER 31 1998 1997 1996
$ $ $
-------- -------- -------
DEFICIT - BEGINNING OF YEAR (45,441) (13,500) (10,091)
Net loss for the year (64,849) (27,619) (3,409)
Accretion of equity component of
convertible debentures (5,906) (4,322) -
-------- -------- -------
DEFICIT - END OF YEAR (116,196) (45,441) (13,500)
========= ======== ========
Consolidated Statements of Changes in Financial Position
in thousands of Canadian dollars
FOR THE YEARS ENDED DECEMBER 31 1998 1997 1996
$ $ $
--------- -------- --------
OPERATING ACTIVITIES
Net loss for the year (64,849) (27,619) (3,409)
Adjustments to reconcile net
loss to cash provided by
operating activities:
Depreciation, depletion
and amortization 11,774 10,555 11,104
Amortization of deferred
financing costs 982 1,788 2,219
Amortization of deferred
foreign exchange 4,229 711 (92)
Amortization of other assets 43 51 24
Writedown of property, plant
and equipment 51,000 24,000 -
Writedown of marketable
securities 805 976 -
--------- -------- --------
Cashflow from operations 3,984 10,462 9,846
Change in non-cash working capital
(note 16) 181 (4,509) (2,397)
--------- -------- --------
4,165 5,953 7,449
--------- -------- --------
INVESTING ACTIVITIES
Property, plant and equipment (16,442) (18,641) (14,366)
Deferred stripping (9,522) - -
Purchase of marketable securities (500) (1,815) -
Other assets 398 242 148
--------- -------- --------
Cash used for investing
activities (26,066) (20,214) (14,218)
--------- -------- --------
FINANCING ACTIVITIES
Share capital - 227 38,520
Convertible debentures (7,184) 90,847 (18,526)
Bank loan (36,520) (4,830) (4,818)
Capital lease obligation 1,447 581 1,307
Other accrued liabilities 547 559 418
--------- -------- --------
Cash provided by (used for)
financing activities (41,710) 87,384 16,901
--------- -------- --------
NET INCREASE (DECREASE) IN
CASH AND SHORT TERM INVESTMENTS (63,611) 73,123 10,132
CASH AND SHORT TERM INVESTMENTS -
BEGINNING OF YEAR 95,237 22,114 11,982
--------- -------- --------
CASH AND SHORT TERM INVESTMENTS -
END OF YEAR 31,626 95,237 22,114
========= ======== ========
CASH AND SHORT TERM INVESTMENTS -
END OF YEAR CONSISTS OF:
Cash and short term investments 11,932 72,758 15,266
Restricted cash 19,694 22,479 6,848
-------- -------- --------
CASH AND SHORT TERM INVESTMENTS -
END OF YEAR 31,626 95,237 22,114
======== ======== ========
Consolidated Statements of Income
in thousands of Canadian dollars
Three months ended Twelve months ended
December 31 December 31
(unaudited) 1998 1997 1998 1997
--------------------------------------
REVENUES 14,863 12,086 45,848 49,553
--------------------------------------
COST OF SALES
Operating costs 9,879 8,712 33,101 31,685
Depreciation, depletion
and amortization 3,991 2,482 11,774 10,555
--------------------------------------
13,870 11,194 44,875 42,240
--------------------------------------
993 892 973 7,313
--------------------------------------
EXPENSES
Amortization of deferred
financing costs 189 453 982 1,788
Exploration 85 499 934 1,454
Foreign exchange 1,235 261 1,228 (390)
General and administrative 1,457 1,127 7,531 4,006
Interest expense 1,143 2,060 6,065 7,979
Interest income (629) (1,421) (2,723) (4,881)
Writedown of property
plant and equipment 51,000 24,000 51,000 24,000
Writedown of marketable
securities 805 976 805 976
--------------------------------------
55,285 27,955 65,822 34,932
---------------------------------------
NET LOSS (54,292) (27,063) (64,849)(27,619)
=======================================
Weighted average shares
outstanding -
basic (000's) 40,857 40,857 40,857 40,854
Earnings (loss)
per share - basic $ (1.37) $ (0.70) $ (1.73)$ (0.78)
Consolidated Statements of Deficit
in thousands of Canadian dollars
Three months ended Twelve months ended
December 31 December 31
(unaudited) 1998 1997 1998 1997
--------------------------------------
DEFICIT, BEGINNING OF
PERIOD 60,313 16,998 45,441 13,500
Convertible debentures -
equity accretion 1,591 1,381 5,906 4,322
Net (income) loss for
the period 54,292 27,063 64,849 27,619
-------------------------------------
DEFICIT, END OF PERIOD 116,196 45,442 116,196 45,441
=====================================
Gold produced (oz) 30,558 21,115 92,548 91,347
Average price realized
(US$/oz) 317 419 336 402
Cash operating costs per
ounce (US$/oz) 209 292 241 251
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