HudBay Minerals Announces Fourth Quarter and 2005 Operating Results.WINNIPEG Winnipeg, city, Canada Winnipeg (wĭn`ĭpĕg), city (1991 pop. 616,790), provincial capital, SE Man., Canada, at the confluence of the Red and Assiniboine rivers. , Manitoba Manitoba (mănĭtō`bə), province (2001 pop. 1,119,583), 250,934 sq mi (650,930 sq km), including 39,215 sq mi (101,580 sq km) of water surface, W central Canada. -- HudBay Minerals Inc. (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :HBM HBM Human Body Model HBM Human Brain Mapping HBM Hottinger Baldwin Messtechnik GmbH (German company) HBM High Bone Mass HBM Hybrid Bilayer Membrane HBM Humming Bird Medal HBM Her/His Britannic Majesty ) - 2005 Financial Highlights - Record earnings of $85.2 million or $1.04 per share - Operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. of $144.8 million or $1.77 per share - Net debt reduced to $66.7 million - Cash costs of $0.13/lb. for zinc zinc, metallic chemical element; symbol Zn; at. no. 30; at. wt. 65.38; m.p. 419.58°C;; b.p. 907°C;; sp. gr. 7.133 at 25°C;; valence +2. Zinc is a lustrous bluish-white metal. It is found in Group 12 of the periodic table. (1) before CMM (Capability Maturity Model) A process developed by SEI in 1986 to help improve, over time, the application of an organization's supporting software technologies. adjustment, or $0.23/lb. 2005 Production Highlights - Zinc production up 4,500 tonnes to 115,000 tonnes - Copper production up 9,000 tonnes to 86,000 tonnes - Gold production up 23,000 oz. to 102,000 oz. - Silver production up 296,000 oz. to 1,410,500 oz. Corporate Highlights - 76-year safety record at Hudson Bay Hudson Bay, inland sea of North America, c.475,000 sq mi (1,230,000 sq km), c.850 mi (1,370 km) long and c.650 mi (1,050 km) wide, E central Canada. Hudson Bay and James Bay (its southern extension) and all their islands border Nunavut Territory, Manitoba, Ontario, - Re-opening Balmat mine in Q2, 2006 - Purchase of White Pine pine, common name for members of the Pinaceae, a family of resinous woody trees with needlelike, usually evergreen leaves. The Pinaceae reproduce by means of cones (see cone) rather than flowers and many have winged seeds, suitable for wind distribution. Copper Refinery, Q1, 2006 - Annual $10 million exploration program HudBay Minerals Inc. (TSX:HBM) ("HudBay") today announced record net earnings of $85.2 million or $1.04 per share on revenue of $652 million, for the year ended December December: see month. 31, 2005. This compares to a loss of $9.9 million on sales of $13.3 million for the year ended December 31, 2004. "We are delighted with the results being reported today, our first full year as a publicly traded company publicly traded company A company whose shares of common stock are held by the public and are available for purchase by investors. The shares of publicly traded firms are bought and sold on the organized exchanges or in the over-the-counter market. ," said Peter R. Jones, President and Chief Executive Officer of HudBay Minerals. "2005 was an excellent year on all fronts, thanks largely to solid production, good costs and strong metal prices." Subsequent to year-end year-end also year·end n. The end of a year. adj. Occurring or done at the end of the year: a year-end audit. Noun 1. , HudBay announced it had closed the purchase of White Pine Copper Refinery Inc. (White Pine), a Michigan-based copper refinery for the previously announced price of US$13 million, subject to certain adjustments. (1) Net of by-product by·prod·uct or by-prod·uct n. 1. Something produced in the making of something else. 2. A secondary result; a side effect. by-product Noun 1. credits In addition, the Company also announced subsequent to year-end that it had completed a $25 million credit facility with The Bank of Nova Scotia Nova Scotia (nō`və skō`shə) [Lat.,=new Scotland], province (2001 pop. 908,007), 21,425 sq mi (55,491 sq km), E Canada. Geography (Scotia Scotia (skō`shə), originally the Latin name for Ireland. In the Middle Ages, it was used to refer to Scotland, to which the Scots had migrated from Ireland. Today it is used poetically. Capital) and that the Bank may consent to increasing the credit facility to $50 million if HBMS HBMS Hudson Bay Mining and Smelting (Manitoba, Canada) satisfies certain conditions. At the same time, HudBay also announced that HBMS has repurchased, through the open market, US$19 million of its 9 5/8% senior secured notes due January January: see month. 5, 2012. Commenting on these announcements, Mr. Jones stated: "The purchase of White Pine completes our copper vertical integration and provides a dedicated facility for processing copper anodes, and this will significantly reduce our operating costs operating costs npl → gastos mpl operacionales for copper refining refining, any of various processes for separating impurities from crude or semifinished materials. It includes the finer processes of metallurgy, the fractional distillation of petroleum into its commercial products, and the purifying of cane, beet, and maple sugar . Completing the $25 million credit facility enhances HudBay's financial strength as we look toward future growth, and the re-purchase of the secured notes reduces our net debt to $66.7 million." For further information, please see attached hereto here·to adv. To this document, matter, or proposition. hereto Adverb Formal or law to this place, matter, or document Adv. 1. , HudBay's management discussion and analysis for the year ended December 31, 2005 and selected financial information for the years ended December 31, 2005 and 2004. A copy of HudBay's consolidated financial statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge for the years ended December 31, 2005 and 2004, as well its MD&A and annual information form for the year ended December 31, 2005, are available on SEDAR SEDAR System for Electronic Document Analysis and Retrieval SEDAR Southeast Data, Assessment, and Review at www.sedar.com and on the HudBay website at www.hudbayminerals.com. About HudBay Minerals Inc. HudBay Minerals Inc. is an integrated mining and metal producing company that operates mines and concentrators in Northern Manitoba and a metal processing complex in Flin Flon Flin Flon (flĭn flŏn), city (1991 pop. in Manitoba, 7,119; in Saskatchewan, 330), on the Man.-Sask. border, Canada. It is a mining and smelting center in a region producing copper, zinc, silver, gold, and cadmium; it also serves a lumbering , Manitoba. The company also owns a zinc oxide zinc oxide, chemical compound, ZnO, that is nearly insoluble in water but soluble in acids or alkalies. It occurs as white hexagonal crystals or a white powder commonly known as zinc white. production facility in Brampton, Ontario Brampton (IPA: ˈbræmptən, ˈbræmtən) is a city in the GTA of Ontario, Canada and the seat of Peel Region. As of the 2006 census, Brampton's population stood at 433,806. , the White Pine Copper Refinery in Michigan Michigan (mĭsh`ĭgən), upper midwestern state of the United States. It consists of two peninsulas thrusting into the Great Lakes and has borders with Ohio and Indiana (S), Wisconsin (W), and the Canadian province of Ontario (N,E). , and the Balmat zinc mine project in New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of State, which is being re-opened. Forward Looking Information Certain information regarding HudBay set forth in this document, including management's assessment of HudBay's future plans and operations, contains forward looking statements that involve substantial known and unknown risks and uncertainties. These forward looking statements are subject to numerous risks and uncertainties, some of which are beyond HudBay's and management's control, including but not limited to, the impact of general economic conditions, industry conditions, fluctuation Fluctuation A price or interest rate change. of commodity prices, acquisition risks, fluctuation of foreign exchange rates, imperfection im·per·fec·tion n. 1. The quality or condition of being imperfect. 2. Something imperfect; a defect or flaw. See Synonyms at blemish. imperfection Noun 1. of reserve estimates, environmental and financing risks, debt and cash requirements, industry competition and performance or achievement could differ materially from those expressed in, or implied Inferred from circumstances; known indirectly. In its legal application, the term implied is used in contrast with express, where the intention regarding the subject matter is explicitly and directly indicated. by, these forward looking statements and, accordingly, no assurance can be given that any of the events anticipated to occur or transpire from the 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. will provide any benefits.
HUDBAY MINERALS INC.
Consolidated Statements of Earnings (Loss)
(In thousands of Canadian dollars,
except share and per share amounts)
Years ended December 31, 2005 and 2004
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2005 2004
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Revenue $ 652,028 $ 13,327
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Expenses:
Operating 480,518 14,081
Depreciation and amortization 53,100 1,443
General and administrative 19,620 5,127
Exploration 11,281 1,734
Accretion of asset retirement obligation 2,612 138
Foreign exchange loss 2,338 -
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569,469 22,523
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Operating earnings (loss) 82,559 (9,196)
Interest expense (21,939) (2,320)
Foreign exchange gain on long term debt 6,825 1,562
Realized and unrealized gain on
derivative instruments 5,319 78
Interest and other income 3,996 103
Amortization of deferred financing fees (2,342) (620)
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Earnings (loss) before income taxes 74,418 (10,393)
Tax recovery 10,800 473
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Earnings (loss) for the year $ 85,218 $ (9,920)
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Earnings (loss) per share:
Basic $ 1.04 $ (1.12)
Diluted 0.70 (1.12)
Weighted average number of common shares
outstanding
Basic 82,008,190 8,894,235
Diluted 121,116,832 8,894,235
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See the financial statements as filed on SEDAR
HUDBAY MINERALS INC.
Consolidated Balance Sheets
(In thousands of Canadian dollars)
December 31, 2005 and 2004
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2005 2004
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Assets:
Current assets:
Cash and cash equivalents $ 141,660 $ 64,553
Accounts receivable 44,698 73,210
Inventories 116,596 100,282
Prepaid expenses 3,625 3,496
Current portion of fair value of
derivatives (note 16c) 4,483 3,418
Future income taxes 26,200 12,900
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337,262 257,859
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Property, plant and equipment 378,207 358,662
Other assets 13,284 26,176
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$ 728,753 $ 642,697
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Liabilities and Shareholders' Equity:
Current liabilities:
Accounts payable and accrued liabilities $ 91,930 $ 89,749
Interest payable on long-term debt 8,004 563
Current portion of other liabilities 28,211 20,595
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128,145 110,907
Long-term debt 191,493 223,529
Pension obligation 46,743 57,437
Other employee future benefits 61,250 57,929
Asset retirement obligations 29,219 27,120
Obligations under capital leases 9,011 11,719
Future income tax liabilities 1,666 1,290
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$ 467,527 $ 489,931
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Shareholders' equity:
Share capital:
Common shares 143,611 120,138
Warrants 28,931 35,850
Contributed surplus 10,015 3,288
Cumulative translation adjustment (63) (24)
Retained earnings (deficit) 78,732 (6,486)
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261,226 152,766
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$ 728,753 $ 642,697
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See the financial statements as filed on SEDAR
HUDBAY MINERALS INC.
Consolidated Statements of Cash Flows
(In thousands of Canadian dollars)
Years ended December 31, 2005 and 2004
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2005 2004
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Cash provided by (used in):
Operating activities:
Earnings (loss) for the year $ 85,218 $ (9,920)
Items not affecting cash:
Depreciation and amortization 53,100 1,227
Realization of previously unrecorded
tax losses (11,858) (397)
Unrealized foreign exchange gain (4,012) (2,980)
Amortization of deferred financing costs 2,342 216
Accretion expense on asset retirement
obligation 2,612 73
Stock-based compensation 2,674 1,193
Unrealized portion of change in fair
value of derivative (562) (78)
Other (6,343) 1,165
Change in non-cash working capital 21,691 2,273
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144,862 (7,228)
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Financing activities:
Issuance (repayment) of senior secured
notes (note 8a) (21,953) 214,112
Issuance of common shares, net of costs 20,607 139,484
Repayments of obligations under capital
leases (3,672) (17)
Repayment of loans payable (2,000) -
Deferred financing cost (350) (9,600)
Proceeds of exercise of stock options - 64
Proceeds on exercise of warrants - 117
Decrease in debenture subscription receivable - 2,000
Issuance of convertible debenture - 600
Repayment of convertible debenture - (2,860)
Advance from HBMS prior to acquisition - 540
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(7,368) 344,440
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Investing activities:
Additions to property, plant and equipment (70,924) (5,180)
Decrease (increase) in restricted cash 13,000 (13,000)
Additions (reductions) to environmental
deposits 31 (294)
Sale of investments 463 -
Acquisition of HBMS, net of cash acquired - (255,610)
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(57,430) (274,084)
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Foreign exchange loss on cash held in
foreign currency (2,957) (689)
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Change in cash and cash equivalents 77,107 62,439
Cash and cash equivalents, beginning of year 64,553 2,114
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Cash and cash equivalents, end of year $ 141,660 $ 64,553
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See the financial statements as filed on SEDAR
To view the Management's Discussion and Analysis Management's discussion and analysis (MD&A) A report from management to shareholders that accompanies the firm's financial statements in the annual report. It explains the period's financial results and enables management to discuss topics that may not be apparent in the financial please click on the following link: http://www.ccnmatthews.com/docs/hbmmda3.pdf HudBay Minerals Inc. (TSX:HBM) |
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