Orvana Earns US$0.3 Million In Third Quarter 2005.TORONTO -- Orvana Minerals Corp. (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :ORV ORV abbr. off-road vehicle ) announced today that it earned net income of US$0.3 million ($0.00 per share) during the third quarter ended June 30, 2005. Net income for the nine months ended June 30, 2005 amounted to US$4.4 million or $0.04 per share. Dollar amounts in this news release are in 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. dollars unless stated otherwise, and fine troy ounces Noun 1. troy ounce - a unit of apothecary weight equal to 480 grains or one twelfth of a pound apothecaries' ounce, ounce troy unit - any of the unit of the troy system of weights of gold produced at the Corporation's Don Mario mine located in eastern Bolivia are referred to as "ounces". The Company produced 17,404 ounces of gold, and sold 13,820 ounces in the three months ended June 30, 2005, generating total revenues of $5.9 million. 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 non-cash working capital items) amounted to $2.8 million in the third quarter 2005. The record production level of 17,345 ounces achieved in the second quarter was repeated in the third quarter ended June 30, 2005 with production of 17,404 ounces. Don Mario Mine Operations During the third quarter 2005, the Don Mario mill treated 58,117 tonnes of ore and produced 17,404 ounces of gold compared to 59,626 tonnes treated and 14,643 ounces produced in the third quarter 2004. The following table indicates the improvement in average head grades in the third quarter 2005 compared to the third quarter 2004:
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3 months 3 months
ended ended
June 30, June May April June 30,
2005 2005 2005 2005 2004
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Underground mine tonnes 36,437 12,989 14,436 9,012 30,760
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g/t 12.23 14.18 9.69 13.48 8.60
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Mini-pit &
stockpile tonnes 21,680 6,579 5,921 9,180 28,866
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g/t 7.47 2.94 8.89 9.81 8.46
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Total tonnes 58,117 19,568 20,357 18,192 59,626
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g/t 10.46 10.40 9.46 11.63 8.54
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Recovery rate 89.1% 86.1% 89.0% 92.1% 89.5%
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Gold produced - ounces 17,404 5,631 5,510 6,263 14,643
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Financial Highlights Orvana sold 13,820 ounces of gold in the third quarter ended June 30, 2005 at an average price of $426 per ounce ounce, in zoology ounce, in zoology: see leopard. ounce, unit of measurement ounce: see English units of measurement. . The 13,820 ounces sold in the third quarter 2005 do not include a shipment of 5,631 ounces with an invoice An itemized statement or written account of goods sent to a purchaser or consignee by a vendor that indicates the quantity and price of each piece of merchandise shipped. A consular invoice is one used in foreign trade. value of $2.4 million made on the last day of the quarter but for which title did not pass until early July. This gold shipment is included in gold and ore inventories at a cost of $1.1 million at June 30, 2005. Net income for the third quarter 2005 was reduced by a one-time non-cash charge Non-Cash Charge A charge off, made by a company against earnings, that does not require an initial outlay of cash. Notes: Non-cash charges are typically against the depreciation, amortization, and depletion accounts on a company's balance sheet. of $0.9 million for stock-based compensation on stock options granted during the quarter. In addition, the Company continues to incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. certain expenses ($0.5 million in the third quarter 2005) in connection with the assumption of certain management functions currently performed by Compania Minera del Sur S.A. pursuant to a services agreement which is expected to terminate on September 30, 2005. The following table shows cash costs and other production costs for the third quarter 2005 compared to the third quarter 2004. These calculations represent non-GAAP measures (see "Non-GAAP Measures" below):
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Three Months Ended Three Months Ended
June 30, 2005 June 30, 2004
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Costs Cost/oz. Costs Cost/oz.
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Direct mine operating
costs $1,892,150 $108.72 $1,379,589 $94.21
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Third-party smelting,
refining and
transportation costs 31,209 1.79 27,367 1.87
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Cash operating costs 1,923,359 110.51 1,406,956 96.08
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Royalties and mining rights 303,861 17.46 189,292 12.93
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Total cash costs 2,227,220 127.97 1,596,248 109.01
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Depreciation and
amortization 1,193,737 68.59 1,106,392 75.56
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Total production costs $3,420,397 $196.56 $2,702,640 $184.57
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Orvana's operating results and financial position are summarized below:
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Three Months Ended Nine Months Ended
June 30 June 30
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2005 2004 2005 2004
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Revenue $5,892,124 $5,522,965 $18,913,688 $13,325,035
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Expenses 4,611,272 3,152,669 11,546,518 9,216,537
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Net income for the
period 321,389 2,140,472 4,436,671 3,568,219
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Net income per share -
basic and diluted $0.00 $0.02 $0.04 $0.03
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Cash and cash equivalents $7,380,301 $3,397,876
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Total assets 36,659,383 32,512,233
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Long-term debt, including
current portion 8,087,930 15,032,487
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Unaudited 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 and Management's Discussion & Analysis for the third quarter ended June 30, 2005 are available on SEDAR SEDAR System for Electronic Document Analysis and Retrieval SEDAR Southeast Data, Assessment, and Review and at www.orvana.com. About Orvana Orvana Minerals Corp. is a 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. gold mining and exploration company based in Toronto, Ontario, involved in the evaluation, development and mining of precious metal deposits in the Americas. The Company owns the Don Mario mine in eastern Bolivia. Orvana's long-term goal is to become a low cost, long-life, multi-mine producer in the Americas. Orvana's shares have been listed on the Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. since 1992 under the trading symbol Trading symbol See: Ticker symbol ORV. 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. This news release may contain forward-looking statements that are based on the Company's expectations, estimates and projections regarding its business and the 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. market and economic environment in which it operates. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to control or predict. Therefore, actual outcomes and results may differ materially from those expressed in these forward-looking statements and readers should not place undue reliance on such statements. Statements speak only as of the date on which they are made, and the Company undertakes no obligation to update them publicly to reflect new information or the occurrence of future events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or . Non-GAAP Measures The production and unit costs contained in the table above are based on the industry-recognized Gold Institute Production Cost Standard that has been widely adopted throughout the global gold industry. The purpose of providing this information standard is to give management and the financial community a tool to make meaningful comparisons of gold mining companies with production cost information in a uniform format. These calculations represent non-GAAP information, do not have a standardized standardized pertaining to data that have been submitted to standardization procedures. standardized morbidity rate see morbidity rate. standardized mortality rate see mortality rate. meaning prescribed pre·scribe v. pre·scribed, pre·scrib·ing, pre·scribes v.tr. 1. To set down as a rule or guide; enjoin. See Synonyms at dictate. 2. To order the use of (a medicine or other treatment). by GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). , should not be construed as an alternative to GAAP reporting of operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. , and may not be comparable to similar measures presented by other issuers. For a reconciliation of the non-GAAP costs and unit costs provided above with the Company's GAAP-based statement of operations See Income statement. , please see the Company's Management Discussion & Analysis for the third quarter ended June 30, 2005. Orvana Minerals Corp. (TSX:ORV) |
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