Eldorado Gold Corporation: First Quarter 2004 Financial Results.Business Editors VANCOUVER, British Columbia--(BUSINESS WIRE)--May 13, 2004 (all figures in US dollars) Eldorado Gold Eldorado Gold Corporation TSX: ELD is a Vancouver, British Columbia based company involved in the mining, exploration and development of gold properties in Brazil and Turkey. See also
See: American Stock Exchange :EGO ego: see psychoanalysis. ego (Latin; “I”) In psychoanalytic theory, the portion of the psyche experienced as the “self” or “I. ) (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :ELD) today reported a net loss of $0.7 million for Q1 2004 compared to a net income of $1.7 million in Q1 2003. First Quarter 2004 Highlights - Produced 21,158 ounces of gold at a total cash cost of $284/oz. - Generated 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 of $1.6 million - Completed private land acquisition necessary for Kisladag construction - Completed initial review of China National Gold assets and proceeding with detailed analysis of four assets of interest - Commenced exploration activities on projects in Brazil and Turkey - Q1 end cash balance of $93.6 million Financial Results During Q1 2004, Eldorado sold 22,793 ounces of gold at an average realized price of $408/oz. compared to the sale of 23,854 ounces of gold at an average price of $356/oz. in Q1 2003. Revenue for Q1 2004 of $9.9 million increased marginally compared to Q1 2003 at $9.4 million. Eldorado reports a net loss of $0.7 million for Q1 2004. The net loss is a result of three non-cash events. The Company recorded a $0.2 million loss on foreign exchange as our currency mix weakened weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. against
the U.S. dollar, a $3.3 million cost of expensing options granted in
the quarter and a net tax gain on the reversal of $1.8 million related
to the completion of our Brazil inter-company debt restructuring Debt RestructuringA method used by companies with outstanding debt obligations to alter the terms of the debt agreements in order to achieve some advantage. Notes: . This compares to a Q1 2003 net income of $1.7 million of which the Company reported a gain on foreign exchange of $2.3 million, a cost of options expense of $0.7 million and a tax expense of $0.1 million. Cash flow from operations in Q1 2004 was $1.6 million compared to $1.2 million in Q1 2003. The Company continues to maintain a strong balance sheet with cash and cash equivalents of $93.6 million as of March 31, 2004 and working capital of $97.8 million. The Company remains debt free and unhedged. Sao Bento A data structure used to store embedded documents in an OpenDoc compound document. Bento, which stands for lunch box in Japanese, provides a "container" to hold the data and a format for defining its contents. Mine Gold production at the Sao Bento Mine in Q1 2004 was 21,158 oz. at a total cash cost of $284/oz. Although production for the quarter was at planned levels, costs were in excess of plan due to and adverse changes in the mineralogy mineralogy Scientific study of minerals, including their physical properties, chemical composition, internal crystal structure, occurrence and distribution in nature, and origins or conditions of formation. of the ore mined, significantly increasing both cyanide cyanide (sī`ənīd'), chemical compound containing the cyano group, -CN. Cyanides are salts or esters of hydrogen cyanide (hydrocyanic acid, HCN) formed by replacing the hydrogen with a metal (e.g., sodium or potassium) or a radical (e.g. and oxygen consumption rates. This change in mineralogy is related to an intrusive in·tru·sive adj. 1. Intruding or tending to intrude. 2. Geology Of or relating to igneous rock that is forced while molten into cracks or between other layers of rock. 3. Linguistics Epenthetic. body which intersects the orebody in the area scheduled for mining in 2004 and as such will detrimentally det·ri·men·tal adj. Causing damage or harm; injurious. det  ri·men affect the
operation throughout 2004.Continued interference with production relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the shaft shaft (shaft) a long slender part, such as the diaphysis of a long bone. shaft n. 1. An elongated rodlike structure, such as the midsection of a long bone. 2. deepening deep·en tr. & intr.v. deep·ened, deep·en·ing, deep·ens To make or become deep or deeper. Noun 1. deepening - a process of becoming deeper and more profound activities and infrastructure development at depth has necessitated a reduction in planned production at Sao Bento in 2004. Revised estimates Revised estimate The third estimate of GDP released about three months after the measurement period. are 85,000 oz. of gold produced at a cash cost of $270/oz. for 2004 improving to 94,000 ounces at $240/oz. in 2005. Kisladag Project The Kisladag Project continues to advance consistent with the plan to commence construction early in Q3 2004. In Q1 2004, the Company successfully completed the acquisition of all the private lands necessary for the construction and operation of the Kisladag Mine. Application for the Construction Permit enabling construction to commence will occur in Q2 2004. The Company, through its engineer Hatch Hatch may refer to: Actions and objects
value added tax n (Brit law in Turkey and reflect changes in metal prices, energy costs, currency and refinement in engineering design. The Company will release the results of the study May 20, 2004 and will host a conference call at 11:00 AM EST EST electroshock therapy. EST abbr. electroshock therapy May 20, 2004 to discuss the study. Efemcukuru Through Q1 2004, work continued in the preparation of the Environmental Impact Assessment ("EIA (Electronic Industries Alliance, Arlington, VA, www.eia.org) A membership organization founded in 1924 as the Radio Manufacturing Association. It sets standards for consumer products and electronic components. ") Report. This report is expected to be completed and submitted to the Ministry of the Environment ("MOE Moe continually exasperated at Larry and Curly for their mischievous pranks. [TV: “The Three Stooges” in Terrace, II, 366] See : Exasperation ") in Q3 2004. Upon approval of the study and receipt of the positive certificate from the MOE, the full feasibility work programme, including drilling, will commence. The project presently contains a defined high-grade resource in excess of 1 million ounces. As part of the feasibility work programme, drilling will be conducted to further expand this resource as previous drilling has not defined the limits of mineralization Mineralization The process by which the body uses minerals to build bone structure. Mentioned in: Rickets mineralization, n the bioprecipitation of an inorganic substance. . China Initiative In Q1 2004, our initial review of China National Gold Corporation's ("CNGC CNGC Cherokee Nation Gaming Commission ") gold assets was completed. As a result of this review, three operating mines and one development project have been identified as having particular interest to Eldorado. Both parties have agreed to further examine these opportunities with the objective to determine a basis for Eldorado's involvement. In addition to the CNGC assets identified by Eldorado, the Company has been actively evaluating a number of exploration properties brought to us by various third parties. In order to facilitate this, the Company has begun preparation to open a Representative Office in Beijing and obtain its business license. Exploration During 2004, Eldorado will be conducting exploration programmes in Brazil, Turkey and China. Brazil Eldorado has obtained mineral licenses on two properties in Amapa State, northern Brazil and another in Rio Grande do Norte Rio Grande do Norte (rē`  grän`dĭ th nôr`tĭ), state (1996 pop. State.Amapa State is located within a lower-proterozoic mineralized min·er·al·ize v. min·er·al·ized, min·er·al·iz·ing, min·er·al·iz·es v.tr. 1. To convert to a mineral substance; petrify. 2. To transform a metal into a mineral by oxidation. 3. corridor which starts in Venezuela and extends through the Guyanas, Brazil and into West Africa West Africa A region of western Africa between the Sahara Desert and the Gulf of Guinea. It was largely controlled by colonial powers until the 20th century. West African adj. & n. . This belt hosts several major gold deposits, including Las Cristinas (11 million ounces), Omai (3.7 million ounces) and Ampari (2 million ounces). Eldorado's land position within this belt totals 120,000 hectares. The work programme for 2004 will focus on geologic ge·ol·o·gy n. pl. ge·ol·o·gies 1. The scientific study of the origin, history, and structure of the earth. 2. The structure of a specific region of the earth's crust. 3. A book on geology. mapping, stream and soil sampling, and geophysics geophysics, study of the structure, composition, and dynamic changes of the earth, its atmosphere, hydrosphere and magnetosphere, based on the principles of physics. to define drill targets. At the Tartarugalzinho Project in Amapa State, work crews have begun sampling and mapping. In the early 1980's this area was explored by BP Minerals, which defined a gold stream sediment sediment, mineral or organic particles that are deposited by the action of wind, water, or glacial ice. These sediments can eventually form sedimentary rocks (see rock). anomaly Abnormality or deviation. Pronounced "uh-nom-uh-lee," it is a favorite word among computer people when complex systems produce output that is inexplicable. See software conflict and anomaly detection. approximately 10 kilometers long by 6 kilometers wide. In total, Eldorado controls over 40 kilometers of the geologic trend which hosts this anomaly, and has scattered Scattered Used for listed equity securities. Unconcentrated buy or sell interest. garimpero workings throughout. Total land package is 80,000 hectares. At Project C, also in Amapa State, a gold soil geochem anomaly measuring approximately 8 kilometers long by 3 kilometers wide was defined by a previous operator. This operator also drilled 50 short holes within a limited portion of the anomaly to define a resource in the saprolite sap·ro·lite n. Soft, partially decomposed rock rich in clay and remaining in its original place. saprolite . Eldorado controls 40,000 hectares in this package. On both of these properties Eldorado plans on initial drilling programmes to commence late in Q3 2004. In Rio Grande do Norte State, Eldorado has obtained 1,050 hectares north of the Bonfim Mine and has made applications for an additional 8,000 hectares. The target at Bonfim North is the down plunge The term Plunge has multiple meanings:
n. (used with a sing. verb) The physics of the earth and its environment, including the physics of fields such as meteorology, oceanography, and seismology. lines for an IP programme scheduled to start in late May. Turkey In Turkey, the Company continues to carry out exploration work through its 100% owned subsidiary Tuprag Metal Mining in the Biga Peninsula in western Turkey, the western Pontide belt as well as the west central Anatolian Plateau plateau, elevated, level or nearly level portion of the earth's surface, larger in summit area than a mountain and bounded on at least one side by steep slopes, occurring on land or in oceans. around Kisladag with its joint venture partner Demir Export. Primary targets remain low sulphidation epithermal high grade vein systems as well as disseminated disseminated /dis·sem·i·nat·ed/ (-sem´i-nat?ed) scattered; distributed over a considerable area. dis·sem·i·nat·ed adj. Spread over a large area of a body, a tissue, or an organ. high sulphidation 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. systems. The Company's land position throughout the country has increased in 2004 through a recent series of government sponsored auctions. Eldorado has licenses covering over 300,000 hectares in Turkey. Over the course of the year exploration activity by domestic as well as international mining companies has increased substantially in Turkey as noted by the increased interest in these auctions. Recent drilling carried out in the Biga Peninsula on three wholly owned prospects totaling 2,000 meters has been completed with follow up planned for the Keditasi prospect, where a shallow dipping 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. structure was drill tested. A strongly mineralized silica silica or silicon dioxide, chemical compound, SiO2. It is insoluble in water, slightly soluble in alkalies, and soluble in dilute hydrofluoric acid. Pure silica is colorless to white. zone on a newly acquired adjacent license area will be followed up during the coming field season to trace the strike extension of the main zone. Initial surface sampling of this 1,600 meter long zone has returned grades up to 3 g/t in rock chip samples. The summer field program for the Demir JV will involve a widely spaced soil sampling program to further investigate an extensive alteration Modification; changing a thing without obliterating it. An alteration is a variation made in the language or terms of a legal document that affects the rights and obligations of the parties to it. zone identified in the Afyon District east of Kisladag. General reconnaissance  This article or section needs copy editing for grammar, style, cohesion, tone and/or spelling.You can assist by [ editing it] now. follow up work will also be carried out on recently acquired licenses in this west central area. The primary focus for the 2004 field season in Turkey will be in the western Pontide belt where the Company has identified and secured land positions covering a number of prospective alteration zones. The western portion of the Black Sea/Pontide volcanic arc volcanic arc n. A usually arc-shaped chain of volcanoes located on the margin of the overriding plate at a convergent plate boundary. volcanic arc extends over 250 kilometers. We have built a strong land position within the region and will be continuing surface sampling and mapping activity on three advanced prospects representing a combination of bulk tonnage TONNAGE, mar. law. The capacity of a ship or vessel. 2. The act of congress of March 2, 1799, s. 64, 1 Story's L. U. S. 630, directs that to ascertain the tonnage of any ship or vessel, the surveyor, &c. systems and bonanza Bonanza saga of the Cartwright family. [TV: Terrace, I, 111–112] See : Wild West grade vein structures. Following positive stream and rock chip sampling in 2003 the intention is to advance knowledge of these prospects to a drill decision before the end of the 2004 field season. First pass reconnaissance work will continue on other targets in the Pontide arc. Eldorado is a gold producing and exploration company with gold assets in Brazil and Turkey; two countries that we believe have substantial geological ge·ol·o·gy n. pl. ge·ol·o·gies 1. The scientific study of the origin, history, and structure of the earth. 2. The structure of a specific region of the earth's crust. 3. A book on geology. potential. With our international expertise in mining, finance and project development, together with highly skilled and dedicated staff, we believe that Eldorado is well positioned to experience continued growth and value as we create and pursue new opportunities. ON BEHALF OF ELDORADO GOLD CORPORATION Paul N. Wright, President & Chief Executive Officer Certain of the statements made may contain 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. within the meaning of Section 21E of the Securities Exchange Act of 1934, which involve known and unknown risk, uncertainties and other factors which may cause the actual results, performance or achievements of the Company, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are subject to a variety of risks and uncertainties which could cause actual events or results to differ from those reflected in the forward-looking statements. Should one or more of these risks and uncertainties materialize ma·te·ri·al·ize v. ma·te·ri·al·ized, ma·te·ri·al·iz·ing, ma·te·ri·al·iz·es v.tr. 1. To cause to become real or actual: By building the house, we materialized a dream. , or should underlying assumptions prove incorrect, actual results may vary materially from those described in forward looking statements. Specific reference is made to "Narrative Description of the Business - Risk Factors" in the Company's Annual Information Form. Forward-looking statements in this release include statements regarding the expectations and beliefs of management, the assumed long-term price of gold, the estimation estimation In mathematics, use of a function or formula to derive a solution or make a prediction. Unlike approximation, it has precise connotations. In statistics, for example, it connotes the careful selection and testing of a function called an estimator. of mineral reserves and resources, the realization of mineral reserve estimates, the potential of Eldorado's properties and expectations of growth. We do not expect to update forward-looking statements continually con·tin·u·al adj. 1. Recurring regularly or frequently: the continual need to pay the mortgage. 2. as conditions change and you are referred to the full discussion of the Company's business contained in the Company's reports filed with the securities regulatory authorities Noun 1. regulatory authority - a governmental agency that regulates businesses in the public interest regulatory agency administrative body, administrative unit - a unit with administrative responsibilities . Eldorado Gold Corporation's shares trade on the Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. (TSX: ELD) and 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: EGO). Request for information packages: info@eldoradogold.com.
Eldorado Gold Corporation
Consolidated Balance Sheets
(Expressed in thousands of U.S. dollars)
March 31, December 31,
2004 2003
--------------------------------------------------------------------
(Unaudited)
ASSETS
Current Assets
Cash and cash equivalents $ 93,630 $ 105,465
Accounts receivable 3,982 3,213
Inventories 5,196 5,623
---------------------------
102,808 114,301
Property, plant and equipment 25,704 23,784
Mineral properties and deferred
development 42,681 32,287
Investments and advances 1,224 1,258
Other assets and deferred charges - -
---------------------------
$ 172,417 $ 171,630
---------------------------
---------------------------
LIABILITIES
Current Liabilities
Accounts payable and accrued
liabilities $ 4,997 $ 7,164
---------------------------
4,997 7,164
Asset retirement obligation 7,279 7,172
Contractual severance obligation 398 318
Deferred gain (loss) - (329)
Future income taxes 3,165 3,830
Convertible debentures - -
---------------------------
15,839 18,155
SHAREHOLDERS' EQUITY
Share capital (Note 3) 445,115 444,665
Contributed surplus 1,094 1,094
Stock based compensation 5,456 1,418
Equity portion of convertible
debentures - -
Deficit (295,087) (293,702)
---------------------------
156,578 153,475
---------------------------
$ 172,417 $ 171,630
---------------------------
---------------------------
Approved by the Board Approved by the Board
Robert Gilmore Paul Wright
Director Director
Eldorado Gold Corporation
Consolidated Statements of Operations and Deficit
(Expressed in thousands of U.S. dollars except per share amounts)
Three months ended
March 31, March 31,
2004 2003
--------------------------------------------------------------------
(Unaudited) (Unaudited)
Revenue
Gold sales $ 8,973 $ 9,166
Interest and other income 967 282
---------------------------
9,940 9,448
Expenses
Operating costs 6,265 5,050
Depletion, depreciation and
amortization 1,059 2,564
General and administrative 1,245 1,038
Exploration expense 927 250
Interest and financing costs - 192
Stock based compensation expense 3,316 722
Accretion expense 107 102
Foreign exchange loss (gain) 236 (2,267)
---------------------------
13,155 7,651
---------------------------
Profit (loss) before the undernoted
items (3,215) 1,797
---------------------------
Gain on disposal of investments and
advances 37 -
---------------------------
Profit (loss) before income taxes (3,178) 1,797
Taxes
Current 1,845 (118)
Future 670 -
---------------------------
Net income (loss) for the period $ (663) $ 1,679
---------------------------
Deficit at the beginning of the
period: (294,424) (248,669)
Deficit at the end of the period $(295,087) $(246,990)
---------------------------
---------------------------
Weighted average number
of shares outstanding 254,236,824 209,956,508
---------------------------
---------------------------
Basic and Diluted Income (loss) per
share - U.S.$ $ - $ 0.01
---------------------------
---------------------------
Basic and Diluted Income (loss) per
share - CDN.$ $ - $ 0.01
---------------------------
---------------------------
Eldorado Gold Corporation
Consolidated Statements of Cash Flows
(Expressed in thousands of U.S. dollars)
Three months ended
March 31, March 31,
2004 2003
--------------------------------------------------------------------
(Unaudited) (Unaudited)
Cash flows from operating
activities
Net income (loss) for the period $ (663) $ 1,679
Items not affecting cash
Depletion, depreciation and
amortization 1,059 2,564
Future income taxes (670) -
Gain on sale of investments - -
Interest and financing costs - 45
Amortization of hedging loss (gain) 329 (680)
Stock based compensation expense 3,316 722
Contractual severance expense 80 -
Accretion expense 107 102
Foreign exchange loss (gain) 516 (2,430)
---------------------------
4,074 2,002
(Increase) in accounts receivable (769) (47)
(Increase) decrease in inventories 427 7
(Decrease) Increase in accounts
payable and accrued liabilities (2,167) (760)
---------------------------
1,565 1,202
Cash flow from investing activities
Property, plant and equipment (2,979) (1,906)
Mineral properties and deferred
development (10,394) (795)
Investments and advances (35) (4)
Proceeds from disposals of
investments and advances 69 -
---------------------------
(13,339) (2,705)
Cash flow from financing activities
Issue of common shares:
Voting - for cash 450 3,003
---------------------------
450 3,003
Foreign exchange gain (loss) on
cash held in foreign currency (511) 2,444
---------------------------
Net Increase (decrease) in cash and
cash equivalents (11,835) 3,944
Cash and cash equivalents at
beginning of the period 105,465 37,627
---------------------------
Cash and cash equivalents at end of
the period $ 93,630 $ 41,571
---------------------------
---------------------------
Supplemental cash flow information
Interest paid $ - $ -
---------------------------
Income tax paid $ - $ 10
---------------------------
PRODUCTION HIGHLIGHTS (1)
---------------------------------------------------------------------
Q1 Q2 Q3 Q4 Q1
2003 2003 2003 2003 2004
---------------------------------------------------------------------
Gold Production
---------------
Ounces produced 21,831 26,772 23,327 23,119 21,158
Cash Operating Cost ($/oz)(5) 215 230 245 245 276
Total Cash Cost ($/oz)(2,5) 222 237 253 252 284
Total Production Cost
($/oz)(3,5) 338 350 383 386 341
Realized Price ($/oz -
sold)(4) 356 344 358 390 408
---------------------------------------------------------------------
Sao Bento Mine, Brazil
----------------------
Ounces produced 21,831 26,772 23,327 23,119 21,158
Tonnes to Mill 92,104 94,497 93,824 93,705 90,586
Grade (grams / tonne) 9.55 8.95 9.31 8.72 8.18
Cash Operating Cost ($/oz)(5) 215 230 245 245 276
Total Cash Cost ($/oz)(2,5) 222 237 253 252 284
Total Production Cost
($/oz)(3,5) 338 350 383 386 341
---------------------------------------------------------------------
1 Cost figures calculated in accordance with Gold Institute Standard
2 Cash Operating Costs plus royalties and the cost of off-site
administration.
3 Total Cash Cost plus foreign exchange gain or loss, depreciation,
amortization and reclamation expenses. Total Production Costs for
2003 have been revised to include Section 3110 of the Canadian
Institute of Chartered Accountants (CICA 3110 - Asset Retirement
Obligation).
4 Excludes amortization of deferred gain.
5 Cash operating, total cash and total production costs are non-GAAP
measures that do not have any standardized meaning as prescribed by
GAAP and are therefore unlikely to be comparable to similar
measures presented by other entities. Please see section "Non-GAAP
Measures" of the MD&A.
The TSX has neither approved nor disapproved the form or content of this release. |
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