Printer Friendly

THIRD QUARTER RESULTS OUT FOR AMAX GOLD PRODUCTION, EARNINGS LOWER

 THIRD QUARTER RESULTS OUT FOR AMAX GOLD
 PRODUCTION, EARNINGS LOWER
 GOLDEN, Colo., Oct. 16 /PRNewswire/ -- Amax Gold Inc. (NYSE: AU; Toronto: AXG) announced 1992 third quarter net earnings of $.7 million (1 cent per share) compared to $5.4 million (9 cents per share) for the third quarter of 1991. Sales for the third quarter were $22.4 million contrasted with sales of $32.4 million for the 1991 third quarter. Net earnings for the first nine months of 1992 were $16.4 million (22 cents per share) on sales of $72.3 million. This compares to net earnings of $20.9 million (35 cents per share) on sales of $101.7 million for the January through September 1991 period.
 There were a number of factors affecting earnings for the third quarter and the nine months:
 -- Ounces of gold sold in the third quarter were 24 percent lower
 compared to the like period in 1991. This decline occurred
 primarily as a result of an inventory accumulation at the Hayden
 Hill Mine which commenced production in June 1992.
 -- Quarterly production of 12,103 ounces of gold from Hayden Hill
 partially offset the decline in production from the Sleeper and
 Wind Mountain mines. Sleeper's production for the first nine
 months of 1992 was 24 percent lower as a result of a 57 percent
 decline in mill head grade. Production from Wind Mountain for
 the nine-month period was lower than the like period in 1991 due
 to cessation of mining operations in January 1992.
 -- The average realized price per ounce of gold sold in the third
 quarter was $401, $44 lower than the like quarter in 1991. For
 the nine months, the average realized price was $403, $25 lower
 than the like period in 1991.
 -- Cash production costs for the third quarter and nine-month
 periods were higher than corresponding periods in 1991 as a
 result of lower production at Sleeper and higher costs
 associated with the commissioning of Hayden Hill.
 "The third quarter results were in line with expectation given the depressed gold market," said Timothy J. Haddon, president and chief executive officer. "The Sleeper Mine continued to post impressive productivity increases which helped to offset the declining grade. We are pleased that the Wind Mountain Mine has surpassed our production expectations and continues to produce gold. Hayden Hill should reach production capacity by the first quarter of 1993. And, our development projects are making excellent progress."
 The Hayden Hill Mine, north of Susanville, Calif., poured its first gold on June 15, 1992. The mine operated in a start-up mode during the third quarter. Production of 12,103 ounces of gold for the third quarter is about 33 percent of design production. Fourth quarter production is expected to double over third quarter production, and production should be at design capacity in the first quarter of 1993. The slower than anticipated increase to full production is a result of less continuous, near surface mill grade material. The result has been a greater level of dilution in the mill feed grade. As mining progresses, the mill feed grade is expected to increase, with a concurrent improvement in production.
 Production for the third quarter was 64,695 ounces of gold compared to 69,203 ounces for the third quarter of 1992. During the first nine months of 1992, Amax Gold produced 187,714 ounces of gold compared to 234,469 ounces for the first nine months of the prior year.
 Sleeper continued to increase productivity during the third quarter with higher tonnages mined and milled. Through the first nine months of 1992, operating costs at the mine have been reduced by $3.0 million compared to the 1991 nine-month period. Wind Mountain has surpassed production projections with a nine-month total of 43,483 ounces of gold and continues to provide excellent cash flow for Amax Gold.
 Amax Gold produces and explores for gold in North and South America and New Zealand and is listed on the New York and Toronto stock exchanges. Amax Gold warrants trade on the American Stock Exchange under the symbol AUWT and on the Toronto Stock Exchange under the symbol AXGWT.
 AMAX GOLD INC.
 CONSOLIDATED STATEMENTS OF EARNINGS
 UNAUDITED
 (in thousands except per share amounts)
 Three Months Ended Nine Months Ended
 Sept. 30, Sept. 30,
 1992 1991 1992 1991
 Sales $22,400 $32,400 $72,300 $101,700
 Costs and operating
 expenses:
 Costs applicable
 to sales 11,200 14,600 34,200 43,700
 Depreciation and
 depletion 5,400 5,700 14,800 18,500
 Selling, general
 and administrative
 expenses 2,100 1,500 6,000 5,900
 Total costs and
 operating
 expenses 18,700 21,800 55,000 68,100
 Gross operating
 margin 3,700 10,600 17,300 33,600
 Exploration
 expenses, net (1,600) (5,000) 4,100 (9,700)
 Earnings from
 operations 2,100 5,600 21,400 23,900
 Interest
 income
 (expense), net (800) 400 --- 1,100
 Earnings before
 income taxes 1,300 6,000 21,400 25,000
 Income taxes,
 (1991-net of
 benefit from
 tax sharing
 agreement) (600) (600) (5,000) (4,100)
 Net earnings $ 700 $ 5,400 $16,400 $20,900
 Net earnings per
 common share $ .01 $ .09 $ .22 $ .35
 Weighted average
 common shares
 outstanding 74,301 59,995 73,339 59,995
 AMAX GOLD INC.
 KEY OPERATING FACTORS
 UNAUDITED
 Three Months Ended Nine Months Ended
 Sept. 30, Sept. 30,
 1992 1991 1992 1991
 Sleeper Mine:
 Ounces of gold
 produced(1) 35,286 40,635 111,571 147,195
 Average cost
 per ounce
 produced:
 Cash
 production
 cost(2) $ 220 $ 198 $ 212 $ 174
 Depreciation
 and
 depletion 98 71 97 68
 Total
 production
 cost $ 318 $ 269 $ 309 $ 242
 Wind Mountain Mine:
 Ounces of gold
 produced 11,253 22,055 43,483 67,440
 Average cost
 per ounce
 produced:
 Cash
 production
 cost(2) $ 99 $ 212 $ 121 $ 207
 Depreciation
 and
 depletion --- 103 34 106
 Total
 production
 cost $ 99 $ 315 $ 155 $ 313
 Hayden Hill Mine:
 Ounces of gold
 produced 12,103 --- 13,447 ---
 Average cost
 per ounce
 produced:
 Cash
 production
 cost(2) $ 349 --- $ 343 ---
 Depreciation
 and
 depletion 125 --- 124 ---
 Total
 production
 cost $ 474 --- $ 467 ---
 Waihi Mine:
 Ounces of
 gold
 produced(1)(3) 6,053 6,513 19,213 19,834
 Average cost
 per ounce
 produced:
 Cash
 production
 cost(2) $ 241 $ 180 $ 226 $ 180
 Depreciation
 and
 depletion 60 67 64 67
 Total
 production
 cost $ 301 $ 247 $ 290 $ 247
 Total:
 Ounces of
 gold
 produced(1) 64,695 69,203 187,714 234,469
 Ounces of
 gold sold 55,619 72,973 179,489 237,858
 Average price
 per ounce
 sold $ 401 $ 445 $ 403 $ 428
 Average cost
 per ounce
 produced:(4)
 Cash production
 cost(2) $ 225 $ 201 $ 202 $ 184
 Depreciation
 and depletion 82 81 81 79
 Total
 production
 cost $ 307 $ 282 $ 283 $ 263
 (1) Gold production for the nine month period ended Sept. 30, 1992
 reflects increased production of 4,733 ounces at the Sleeper
 Mine and 542 ounces at the Waihi Mine relating to the
 cumulative effect of a change in accounting to include
 production in the mill carbon circuit, effective Jan. 1, 1992.
 (2) Cash production costs include all operating costs at the mine
 sites, including overhead, and, where applicable, Nevada net
 proceeds tax, royalties and credits for silver by-products.
 (3) Represents the company's share, which increased from
 28.35 percent to 33.53 percent on April 1, 1991.
 (4) Average costs weighted by ounces of gold produced at each mine.
 AMAX GOLD INC.
 CONSOLIDATED CONDENSED STATEMENTS
 OF FINANCIAL POSITION
 (Dollars in thousands except par value of stock)
 Sept. 30, Dec. 31,
 1992 1991
 ASSETS (Unaudited)
 Cash and equivalents
 (including restricted cash
 of $2,200 in 1992 and
 $6,100 in 1991) $ 4,300 $ 9,500
 Demand note receivable
 from Amax 21,900 15,400
 Inventories 12,900 9,900
 Prepaid expenses and other
 assets 6,800 6,900
 Current assets 45,900 41,700
 Property, plant and equipment,
 net 422,400 146,100
 Acquisition costs --- 7,600
 Other assets 200 2,900
 Total assets $468,500 $198,300
 LIABILITIES AND SHAREHOLDERS'
 EQUITY
 Accounts payable,
 trade $ 6,400 $ 9,600
 Accounts payable,
 affiliates 500 1,700
 Accrued and other current
 liabilities 15,600 14,400
 Short-term debt 9,700 2,500
 Current liabilities 32,200 28,200
 Long-term debt 106,700 22,500
 Unearned revenue, noncurrent 1,600 1,600
 Other noncurrent liabilities 5,900 4,000
 Total liabilities 146,400 56,300
 Deferred taxes 59,200 5,700
 Shareholders' equity:
 Preferred stock,
 par value $1.00
 per share,
 authorized
 10,000,000 shares,
 issued and
 outstanding, none --- --
 Common stock, par value
 1 cent per share, authorized
 200,000,000 shares in 1992 and
 100,000,000 shares in 1991,
 issued and outstanding
 74,372,441 shares in 1992 and
 59,999,982 shares in 1991 700 600
 Paid-in capital 124,400 9,900
 Retained earnings 138,600 126,600
 Cumulative translation
 adjustment (700) (700)
 Common stock in treasury, at
 cost (4,500 shares in
 1992 and 1991) (100) (100)
 Total shareholders' equity 262,900 136,300
 Total liabilities and
 shareholders' equity $468,500 $198,300
 AMAX GOLD INC.
 CONSOLIDATED STATEMENTS OF CASH FLOWS
 UNAUDITED
 (Dollars in thousands)
 Nine Months Ended
 Sept. 30,
 1992 1991
 Cash Flows from Operating Activities
 Net Earnings $ 16,400 $ 20,900
 Adjustments to reconcile net
 earnings to net cash provided
 by operating activities:
 Depreciation and depletion 14,800 18,500
 Increase in deferred taxes 3,300 200
 Increase in reclamation reserves 1,300 700
 Other, net 300 (400)
 Capitalization of prior period
 exploration costs (8,900) ---
 Amortization of prepaid royalty --- 700
 Decrease (increase) in working
 capital, net of effect of investing
 and financing activities:
 Accrued and other current liabilities 1,000 1,200
 Accounts payable, trade (4,000) 100
 Inventories (3,000) 500
 Accounts payable, affiliates (1,200) (900)
 Prepaid expenses and other assets (200) (2,900)
 Net cash provided by operating
 activities 19,800 38,600
 Investing Activities
 Acquisition costs, net of cash
 acquired 600 (1,100)
 Capital expenditures for property,
 plant and equipment (96,900) (36,800)
 Repayments from and (advances to)
 Amax (6,500) 15,100
 Other (200) (300)
 Net cash used by investing activities (103,000) (23,100)
 Financing Activities
 Proceeds from financings 80,700 ---
 Dividends (2,300) (3,600)
 Other (400) (100)
 Decrease in unearned revenue from
 repayments under precious metal
 financings --- (7,900)
 Net cash provided (used) by
 financing activities 78,000 (11,600)
 Net increase (decrease) in cash and
 equivalents (5,200) 3,900
 Cash and equivalents at Jan. 1 9,500 500
 Cash and equivalents at Sept. 30
 (including restricted cash of $2,200
 in 1992) $ 4,300 $ 4,400
 -0- 10/16/92
 /CONTACT: Gina Wilson of Amax Gold, 303-273-0623/
 (AU) CO: Amax Gold Inc. ST: Colorado IN: MNG SU: ERN


BB -- DV001 -- 0911 10/16/92 11:38 EDT
COPYRIGHT 1992 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1992 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Oct 16, 1992
Words:1793
Previous Article:IRWIN FINANCIAL CORPORATION ANNOUNCES THIRD QUARTER EARNINGS UP 93 PERCENT
Next Article:PENNDOT ISSUES BRIDGE INSPECTION AND MAINTENANCE OPERATION SCHEDULES
Topics:


Related Articles
YEAR-END RESULTS FOR AMAX GOLD EARNINGS DOWN 25 PERCENT - RESERVES INCREASE 78 PERCENT
AMAX GOLD ANNOUNCES SECOND QUARTER/HALF YEAR RESULTS; GOLD IS POURED AT HAYDEN HILL
AMAX GOLD 1992 EARNINGS IMPACTED BY PRODUCTION, PRICE OF GOLD
AMAX GOLD RECORDS FIRST QUARTER LOSS
AMAX GOLD WRITES DOWN HAYDEN HILL MINE REPORTS 2ND QUARTER/HALF YEAR RESULTS
AMAX GOLD REPORTS THIRD QUARTER LOSS
AMAX GOLD 1993 YEAR-END RESULTS
AMAX GOLD 1993 YEAR-END RESULTS
CYPRUS AMAX MINERALS REPORTS FIRST QUARTER EARNINGS OF $62 MILLION
Amax Gold Reports Reduced Cash Operating Costs and Improved Third Quarter and Year-To-Date Results

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters