TVX Cash Costs $170 Per Ounce Year To Date Production Costs $266 Per Ounce.TORONTO--(BUSINESS WIRE)--Nov. 5, 1999-- Olympias Olympias, d. 316 B.C., wife of Philip II of Macedon and mother of Alexander the Great. She did not get on well with Philip, who had other wives, but the story that she murdered him is probably false. Revised Bankable bank·a·ble adj. 1. Acceptable to or at a bank: bankable funds. 2. Guaranteed to bring profit: a bankable movie star. Feasibility Study The analysis of a problem to determine if it can be solved effectively. The operational (will it work?), economical (costs and benefits) and technical (can it be built?) aspects are part of the study. Results of the study determine whether the solution should be implemented. Yields 17% Internal Rate of Return At $325 Gold TVX TVx Target Vertex TVX Transmission Valid Timer (FDDI) TVX Valid Transmission Gold Inc. TSE See Tokyo Stock Exchange. TSE 1. See Tokyo Stock Exchange (TSE). 2. See Toronto Stock Exchange (TSE). : TVX.) (ME: TVX.) (NYSE NYSE See: New York Stock Exchange : TVX) reported a loss of $0.8 million for the third quarter of 1999, compared to net earnings of $0.1 million in the same quarter a year ago. TVX's share of production from its five joint ventures was 59,800 gold equivalent ounces for the period, after accounting for Normandy Normandy (nôr`məndē), Fr. Normandie (nôrmäNdē`), region and former province, NW France, bordering on the English Channel. Mining Limited's minority interests in the TVX-Normandy Americas A·mer·i·cas , the See America. joint ventures. The TVX-Normandy production for the quarter was 119,600 gold equivalent ounces for the period compared to 138,200 gold equivalent ounces produced for the three months ended September September: see month. 30, 1998. Cash cost per ounce ounce, in zoology ounce, in zoology: see leopard. ounce, unit of measurement ounce: see English units of measurement. for the period was $175 and $170 for the nine months period compared to $182 and $192 achieved in the corresponding 1998 periods. Production cost per ounce was $273 for the third quarter and $266 year to date, compared to $278 and $292 realized for the respective periods in 1998. Revenue and 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. were $36.5 million and $4.0 million, respectively, in this quarter, versus $40.6 million and $14.6 million in the corresponding quarter last year. The decline in revenue and cash flows year over year is principally a result of a lower gold spot price and lower production attributed to the company post-completion of the Normandy transaction. Year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. revenue was $124.2 million and operating cash flow was $32.5 million. Year-to-date revenue increased by $6 million compared to the corresponding previous period as the company benefited from significantly higher silver production at La Coipa partially offset by a negative gold price variance The materials price variance (Vmp) is computed as follows: Vmp = (Actual Unit Cost - Standard Unit Cost) * Actual Quantity Purchased or Vmp = (Actual Quantity Purchased * Actual Unit Cost) - (Actual Quantity Purchased * Standard Unit Cost). . Metals prices realized in the third quarter were $380 per ounce of gold and $4.00 per ounce of silver, after accounting for the impact of deferred revenue of $99 per gold ounce and loss of $1.20 per silver ounce, compared to $374 and $4.00, respectively, realized in the corresponding 1998 period. The spot gold price for the current quarter was $259 per ounce compared to $289 per ounce for the third quarter of 1998. For the nine months ended September 30, realized metals prices were $397 per ounce of gold and $4.30 per ounce of silver after accounting for the impact of deferred revenue. TVX's consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: cash position stood at $133 million and $23.5 million of near-cash short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. investments with maturity dates greater than 90 days, as at September 30, 1999. Eike Eike is a village in the municipality of Karmøy, Norway. Its population (2005) is 1,408, of which 24 people live within the border of the neighboring municipality Tysvær. It also is a male and female name used in Scandinavia and especially northern Germany. Batista Not to be confused with Barista. Batista is a Spanish or Portuguese surname. It may refer to:
Operations At La Coipa (TVX 25 per cent) 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. , the company's share of gold equivalent production was 22,600 ounces (5,350 ounces of gold and 1.0 million ounces of silver) in the third quarter. The TVX-Normandy attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk gold equivalent production was 45,200 (10,700 ounces of gold and 2.0 million ounces of silver) compared to 68,800 gold equivalent ounces (65,400 ounces of gold and 3.8 million ounces of silver) produced in the third quarter of 1998. Cash cost per ounce was $189 for the quarter and $166 for the same quarter in 1998. The decline in production and increase in cash cost year over year is attributed to winding-down mining operations at the Chimberos silver deposit during the second quarter of 1999 and the return to historic production and cash cost levels. Mining operations have resumed at La Coipa's main Ladera-Farellon and Coipa Norte pits. Total annual production at La Coipa is anticipated to be 350,000 gold equivalent ounces for the year 2000, at an estimated cash cost of $190 per gold equivalent ounce. At the Crixas mine (TVX 25 per cent), in Brazil Brazil (brəzĭl`), Port. Brasil, officially Federative Republic of Brazil, republic (2005 est. pop. 186,113,000), 3,286,470 sq mi (8,511,965 sq km), E South America. , TVX's share of gold production was 10,400 ounces in the period. The TVX-Normandy Americas gold production was 20,800 gold ounces compared to 18,500 gold ounces produced in the corresponding 1998 period. Cash cost per ounce at Crixas was $119 for the quarter compared to $155 realized in the same period the prior year. Year to date cash cost declined significantly to $126 compared to $161 posted in 1998, primarily due to cost reduction measures and the devaluation devaluation, decreasing the value of one nation's currency relative to gold or the currencies of other nations. It is usually undertaken as a means of correcting a deficit in the balance of payments. of the Brazilian currency. Studies are being conducted to increase plant throughput The speed with which a computer processes data. It is a combination of internal processing speed, peripheral speeds (I/O) and the efficiency of the operating system and other system software all working together. 1. from the current estimated 600,000 tonnes per year to 700,000 tonnes next year. Consideration is also being given to extending the working week from a five-day workweek to a seven-day Adj. 1. seven-day - lasting through a week; "her weeklong vacation" weeklong long - primarily temporal sense; being or indicating a relatively great or greater than average duration or passage of time or a duration as specified; "a long life"; "a long boring workweek. If these changes are implemented, Crixas' anticipated total production will increase to 170,000 gold ounces at a cash cost of $110 per ounce in 2000 compared to the projected 1999 production of 149,000 gold ounces at a cash cost of $125 per ounce. At the Brasilia mine (TVX 24.5 per cent) also in Brazil, the company's attributable share of production for the period was 12,150 gold ounces. TVX-Normandy Americas share of gold production was 24,300 ounces compared to 21,300 ounces produced in the same quarter in 1998. Cash cost per ounce for the quarter was $169 and $179 for the first nine months of the year, compared to $235 realized in the same quarter the previous year and $232 for the first nine months of 1998. The significant decline in cash cost year-over-year is attributed to earlier than anticipated implementation of the fifth grinding mill Grinding mill A machine that reduces the size of particles of raw material fed into it. The size reduction may be to facilitate removal of valuable constituents from an ore or to prepare the material for industrial use, as in preparing clay for pottery making , better recoveries and the devaluation of the Brazilian currency. Total annual production at Brasilia in 2000 is estimated at 240,000 ounces of gold at a cash cost of less than $180 per ounce. At Musselwhite (TVX 16 per cent) in northwestern Ontario Northwestern Ontario is the region within the Canadian province of Ontario which lies north and west of Lake Superior, and west of Hudson Bay and James Bay. It includes most of subarctic Ontario. , the company's share of production was 8,150 gold ounces in the third quarter of 1999. The TVX-Normandy share of production for the period was 24,300 ounces compared to 21,300 ounces produced in the corresponding 1998 quarter. The increase in production in the 1999 period was principally attributed to higher than plan head grade. Cash cost per ounce for the period was $173 similar to the $171 realized in the same period the previous year. Year-to-date realized cash costs of $179 are in line with the $177 cash cost realized in 1998. Total production for next year is anticipated to be 230,000 gold ounces at a $165 cash cost. At the TVX-operated New Britannia Bri·tan·nia n. 1. A female personification of Great Britain or the British Empire. 2. also britannia Britannia metal. mine (TVX 25 per cent) in 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. , TVX's share of production in the third quarter was 6,500 ounces of gold. TVX-Normandy's share of gold production was similar to the 12,900 gold ounces produced for the same period in 1998. Cash cost per ounce for the quarter was $216, an improvement on the $230 per ounce realized in the corresponding 1998 period. The grade related dilution Dilution A reduction in earnings per share of common stock that occurs through the issuance of additional shares or the conversion of convertible securities. Notes: Adding to the number of shares outstanding reduces the value of holdings of existing shareholders. encountered in the second quarter was overcome during the third quarter, with the month of September yielding a record production month in terms of throughput and gold production resulting in cash cost for the month below $200 per ounce. New Britannia's total annual production is estimated to be 100,000 gold ounces at a cash cost below $215 per ounce in 2000. TVX Gold's attributable share of production for 2000 is estimated at 250,000 gold equivalent ounces at an anticipated cash cost below $180 per gold equivalent ounce. Greek In desktop publishing, to display text in a representative form in which the actual letters are not discernible, because the screen resolution isn't high enough to display them properly. The software lets you set which font sizes should be greeked. Development Project TVX recently announced the completion of the revised bankable feasibility study for its Olympias gold polymetallic project in Greece Greece, Gr. Hellas or Ellas, republic (2005 est. pop. 10,668,000), 50,944 sq mi (131,945 sq km), SE Europe. It occupies the southernmost part of the Balkan Peninsula and borders on the Ionian Sea in the west, on the Mediterranean Sea in the south, on . The Olympias project is expected to produce an average of 254,000 ounces of gold in dore per year and 2.3 million ounces of silver (approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 39,000 ounces of gold equivalent) contained in lead concentrate per year for the first five years of operation, with the first full year of production anticipated to be in 2003. Cash operating cost during this period is projected to be $91 per ounce of gold, net of byproduct by·prod·uct or by-prod·uct n. 1. Something produced in the making of something else. 2. A secondary result; a side effect. Noun 1. credits, and over the life of the project cash operating cost is projected to be $87 per ounce. The feasibility study demonstrates that the project is economic, technically feasible (algorithm) feasible - A description of an algorithm that takes polynomial time (that is, for a problem set of size N, the resources required to solve the problem can be expressed as some polynomial involving N). and yields a 17% internal rate of return at a $325 gold price 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. During the course of the third quarter, TVX finalized See finalization. all necessary on-site on-site adj. Done or located at the site, as of a particular activity: on-site monitoring of a production run; an on-site film shoot. work for completion of the Olympias Environmental Impact Study (EIS (1) (Executive Information System) An information system that consolidates and summarizes ongoing transactions within the organization. It provides top management with all the information it requires at all times from internal and external sources. ). The EIS was submitted to the Greek authorities on November November: see month. 1. Approval of the EIS is anticipated in the first quarter 2000. TVX has received a conditional Subject to change; dependent upon or granted based on the occurrence of a future, uncertain event. A conditional payment is the payment of a debt or obligation contingent upon the performance of a certain specified act. commitment letter from Deutsche Bank Deutsche Bank AG (IPA: /'dɔɪ.tʃə/[1]) (ISIN: DE0005140008, NYSE: DB) (English: German Bank , AG (London London, city, Canada London, city (1991 pop. 303,165), SE Ont., Canada, on the Thames River. The site was chosen in 1792 by Governor Simcoe to be the capital of Upper Canada, but York was made capital instead. London was settled in 1826. ) which proposes underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. $130 million of limited recourse Limited recourse A term describing a type of loan in which the lender has limited or no claim against the parent company if the collateral is insufficient to repay the debt. See:Nonrecourse. debt finance and $40 million of grant bridging finance for the development of the Olympias project. The offer is subject to final due diligence Research; analysis; your homework. This term has caught on in all industries, because it sounds so "wired." Who would want to do analysis or research when they can do due diligence. See wired. and the satisfaction of a number of conditions typical for a financing of this nature. The bank commitment, coupled with TVX's own cash contribution, estimated at $72 million including interest during the construction phase, will enable the project to be financed in full. An additional $19 million by TVX will be required to meet ongoing operational requirements (programming) operational requirements - Qualitative and quantitative parameters that specify the desired capabilities of a system and serve as a basis for determining the operational effectiveness and suitability of a system prior to deployment. . Hedge hedge, ornamental or protective barrier composed of shrubs or small trees growing in close rows. The plants may be allowed to grow naturally or may be trimmed to various heights and shapes (see topiary work). Program The recent creation of the TVX-Normandy partnership resulted in TVX effectively selling one-half of its interest in its five operating mines and corresponding production. Accordingly, the company now records one-half of its silver hedge position as a designated hedge and the balanace is marked to market. Depending on certain market conditions, the company may be obligated ob·li·gate tr.v. ob·li·gat·ed, ob·li·gat·ing, ob·li·gates 1. To bind, compel, or constrain by a social, legal, or moral tie. See Synonyms at force. 2. To cause to be grateful or indebted; oblige. to buy silver at market prices to deliver against the position or deposit funds in a trust account. The financial result for the third quarter includes an unrealized mark to market adjustments of $2.2 million. Recently, the company increased its hedged position in years 2003 through 2006, by an aggregate of 390,000 ounces of gold through the purchase of put options. The new transaction consists of 30,000 put options per quarter with a strike price of $360.25 per ounce with maturities from December December: see month. 2003 through to December 2006. Assuming a gold price of $300 per ounce and a lease rate of 3%, the price realized, net of option premiums and lease fees, would be an average $305 per ounce on the newly purchased puts. Credit capacity for the new gold put program was attained at·tain v. at·tained, at·tain·ing, at·tains v.tr. 1. To gain as an objective; achieve: attain a diploma by hard work. 2. from the credit lines made available by Normandy Mining Limited. The cost for utilizing the lines is estimated at less than $1 per ounce of gold per year or approximately $300,000 per year. In addition, existing put options total 680,000 ounces with a strike price of $280 per ounce with quarterly maturities commencing December 1999, through the first quarter of 2003. The use of gold puts protects the company from declining gold prices while allowing the company to participate fully in increases in the gold price. The silver hedge position currently stands at 4.75 million put options with a strike price of $5.06 and 15.65 million ounces of calls with a strike price of $5.99, maturing December 1999 through to 2004. 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. Some statements in this press release contain forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. information. These statements address future events and conditions and so involve inherent risks and uncertainties. Actual results could be significantly different from those currently projected. Visit our website at www.tvxgold.com or, e-mail us at info@tvxgold.com.
1999 Third Quarter Highlights
Reserves and resources (oz)
Year Ended December 31,
1998 1997
Reserves
Gold 11,047,000 4,438,000
Silver 77,705,000 99,794,000
----------- ------------
Gold equivalent 12,380,000 6,163,000
Total Resources (Reserves + Resources)
Gold 18,476,000 22,509,000
Silver 93,311,000 149,584,000
------------ --------------
Gold equivalent 20,075,000 25,023,000
Third Quarter Year to Date
1999 1998 1999 1998
----- ----- ----- -----
Cash Costs
Per gold equivalent ounce $ 175 $ 182 $ 170 $ 192
Financial Results
(millions, except
per-share data)
Revenue $ 36.5 $ 40.6 $ 124.2 $ 117.8
----- ----- ----- -----
Net Earnings (as reported) (0.8) 0.1 10.0 3.1
Less: Interest on
convertible notes (2.5) (2.3) (7.3) (7.0)
Amortization of issuance
costs (0.5) (0.5) (1.6) (1.6)
----- ----- ----- -----
Adjusted earnings (loss) (3.8) (2.8) 1.1 (5.5)
----- ----- ----- -----
Earnings (loss) per share
(as reported) (0.02) (0.02) 0.01 (0.03)
Operating cash flow 5.0 14.6 33.6 69.8
Cash flow per share $ 0.03 $ 0.09 $ 0.20 $ 0.43
Shares outstanding (millions)
Weighted average 179.6 161.8 168.8 161.8
Period end 179.6 161.8 179.6 161.8
Summary of Production (TVXNA)
(ounces)
Third Quarter Year to Date
-------------- -------------
Mine and Ownership 1999 1998 1999 1998
--------- --------- --------- ----------
La Coipa 50%
Gold 10,700 3,400 15,600 49,200
Silver 1,954,300 3,752,500 9,136,200 5,676,800
--------- --------- --------- ----------
Gold equivalent 45,200 68,800 184,600 153,200
Crixas 50% 20,800 18,500 58,300 53,600
Brasilia 49% 24,300 21,300 66,100 67,600
Musselwhite 32% 16,300 16,700 49,300 48,100
New Britannia 50% 13,000 12,900 36,600 36,900
--------- --------- --------- ----------
Gold equivalent 119,600 138,200 394,900 359,400
--------- --------- --------- ----------
Gold 85,100 72,800 225,900 255,400
Silver 1,954,300 3,752,500 9,136,200 5,676,800
Summary of Attributable TVX Production
(ounces)
Gold 42,600 72,800 183,400 255,400
Silver 977,200 3,752,500 8,159,100 5,676,800
--------- --------- --------- ----------
Gold equivalent 59,800 138,200 335,100 359,400
Summary of Cash Costs
($/ounce of gold equivalent)
Third Quarter Year to Date
-------------- -------------
1999 1998 1999 1998
--------- --------- --------- ----------
La Coipa $ 189 $ 166 $ 168 $ 179
Crixas 119 155 126 161
Brasilia 169 235 179 232
Musselwhite 173 171 179 177
New Britannia 216 230 220 240
--------- --------- --------- ----------
Total $ 175 $ 182 $ 170 $ 192
Summary of Realized Metals Prices
(year to date)
1999 1998
Gold Silver Gold Silver
------- -------
Spot $ 273.0 $ 5.2 $ 294.0 $ 5.5
Cash hedge* 20.3 - 28.3 -
Deferred revenue 103.7 (0.9) 46.7 (1.0)
--------- --------- --------- ----------
Realized price $ 397.0 $ 4.3 $ 369.0 $ 4.5
--------- --------- --------- ----------
* Also includes mine actual cash realized versus spot average
Summary Statements of Earnings
(thousands, except per share amounts)
(unaudited)
Third Quarter Year to Date
-------------- -------------
1999 1998 1999 1998
Revenue $ 36,518 $ 40,584 $ 124,158 $ 117,812
--------- --------- --------- ----------
Mine Operating Costs
Costs of sales 21,483 23,800 67,057 67,611
Depletion and
depreciation 12,061 12,446 37,822 34,829
--------- --------- --------- ----------
33,544 36,246 104,879 102,440
--------- --------- --------- ----------
Earnings from Mining
Operations 2,974 4,338 19,279 15,372
--------- --------- --------- ----------
Other Expenses (Income)
Corporate
administration 1,985 2,656 6,145 8,621
Interest expense 1,035 1,572 3,768 4,032
Exploration and business
development 1,736 1,078 4,055 3,998
Translation and foreign
exchange loss 1,254 1,488 2,628 1,468
Interest income (2,574) (2,462) (6,255) (6,884)
Gain on disposal of
minority interests - - (4,197) -
Other income, net 2,623 488 1,700 563
--------- --------- --------- ----------
6,059 4,820 7,844 11,798
--------- --------- --------- ----------
Earnings (loss) before
income tax (3,085) (482) 11,435 3,574
Income taxes (462) (594) 3,252 500
Minority interests (1,822) - (1,822) -
--------- --------- --------- ----------
Net Earnings (Loss) $ (801) $ 112 $ 10,005 $ 3,074
--------- --------- --------- ----------
Earnings (loss) per
Share* $ (0.02) $ (0.02) $ (0.01) $ (0.03)
*After accounting for interest and amortization of issuance costs
on the 5% gold-linked convertible notes
Summary Balance Sheets
(thousands)
September 30, December 31,
1999 1998
(unaudited) (audited)
Assets
Current assets
Cash and cash equivalents $ 130,113 $ 41,232
Short-term investments 41,914 26,522
Accounts receivable 21,156 31,501
Inventories 39,707 41,999
--------- ---------
232,890 141,254
Mining property, plant and equipment 534,775 557,829
Other assets 30,828 51,079
--------- ---------
$ 798,493 $ 750,162
========== ==========
Liabilities
Current liabilities
Accounts payable and accrued liabilities $ 22,385 $ 33,793
Current portion of long-term debt 47,743 67,334
--------- ---------
70,128 101,127
Long-term debt 36,451 131,661
Deferred revenue 22,442 60,431
Other liabilities 27,338 25,859
Deferred income taxes 19,468 20,670
--------- ---------
175,827 339,748
--------- ---------
Minority interests and participation rights 178,247 -
--------- ---------
Shareholders' Equity
Capital stock 385,052 361,052
Gold-linked convertible notes 218,610 209,753
Deficit (159,243) (160,391)
--------- ---------
444,419 410,414
--------- ---------
$ 798,493 $ 750,162
=========== ==========
Summary Statement of Cash Flows
(thousands)
(unaudited)
Third Quarter Year to date
-------------- -------------
1999 1998 1999 1998
--------- --------- --------- ----------
Operating Activities
Net earnings (loss) $ (801) $ 112 $ 10,005 $ 3,074
Non-cash items:
Depletion and
depreciation 12,061 12,446 37,822 34,829
Deferred taxes (707) (491) (1,429) (1,799)
Gain on disposal of
minority interests - - (4,197) -
Minority interests (1,822) - (1,822) -
Deferred revenue (1,063) (317) (9,131) 33,788
Other - 558 121 558
Change in working
capital (2,632) 2,262 2,189 (650)
--------- --------- --------- ----------
Cash provided by
operating activities 5,036 14,570 33,558 69,800
--------- --------- --------- ----------
Investing Activities
Mining property, plant
and equipment (8,680) (24,376) (38,271) (69,778)
Net proceed on disposal
of minority interests - - 180,053 -
Investments (13,271) (18,550) 3,872 (2,943)
Other (244) 2,487 104 5,692
--------- --------- --------- ----------
Cash (used for)
provided by investing
activities (22,195) (40,439) 145,758 (67,029)
--------- --------- --------- ----------
Financing Activities
Common shares issued - - 24,000 -
Gold-linked convertible
notes (5,530) (5,328) (10,236) (9,642)
Net long-term debt
(repayment) financing (9,326) 33,204 (104,199) 8,838
--------- --------- --------- ----------
Cash (used for) provided
by financing
activities (14,856) 27,876 (90,435) (804)
--------- --------- --------- ----------
(Decrease) Increase
in Cash (32,015) 2,007 88,881 1,967
Net cash, beginning
of period 162,128 44,218 41,232 44,258
--------- --------- --------- ----------
Net Cash, End of
Period $ 130,113 $ 46,225 $ 130,113 $ 46,225
========= ======== ========= ==========
All dollar amounts are expressed in US dollars.
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