/NOT FOR DISSEMINATION OR DISTRIBUTION IN THE UNITED STATES AND NOT FOR DISTRIBUTION TO
US NEWSWIRE SERVICES./
(All financial figures in US Dollars unless
otherwise stated)
MELBOURNE, May 14, 2020 /CNW/ - OceanaGold Corporation
(TSX: OGC) (ASX: OGC) (the "Company") reported its
financial and operational results for the quarter ended
March 31, 2020. This follows the
release of the Company's operational results on May 6, 2020. Details of the consolidated
financial statements and the Management Discussion and Analysis
("MD&A") are available on the Company's website at
www.oceanagold.com
Highlights
- First quarter revenue was $138.2
million with Earnings before Interest, Depreciation and
Amortisation ("EBITDA") of $42.4
million.
- First quarter net loss of $26.0
million and an adjusted net loss of $10.7 million representing an adjusted earnings
per share of ($0.02).
- Operating cash flow of $120.6
million in the first quarter with full diluted cash flow per
share before working capital of $0.07
and $0.19 per share inclusive of gold
presale.
- Total immediate available liquidity of $177.4 million; net debt decreased from
$179.4 million to $121.1 million.
- Proactive steps taken to increase cash reserves, including draw
down of the remaining $50 million on
the revolving credit facility, $78.5
million gold presale, and $22.7
million divestment of a non-core equity position.
- Consolidated gold production of 80,707 ounces at consolidated
All-In Sustaining Costs ("AISC") of $1,218 per ounce on sales of 91,388 ounces of
gold.
- Full year 2020 guidance reaffirmed.
Michael Holmes, President and CEO
of OceanaGold said, "With the first quarter of 2020 complete, we
look ahead to the remainder of the year where, in the second half
in particular, we expect increased production at lower All-In
Sustaining Costs. At Haile, mined and processed grades are expected
to increase progressively with two-thirds of Haile's annual gold
output expected in the second half with the fourth quarter being
the strongest quarter. At Macraes, second quarter production is
expected to be lower than in the first quarter due to the impact of
the five-week New Zealand Government enforced COVID-19 lockdown.
However, with production now effectively back to capacity we are
targeting a rebound in the second half of the year."
"Our organic growth projects continue to advance, with first
production from the Martha Underground expected in the second
quarter of 2021. We are progressing the Waihi District Study which
will highlight the initial value of the Waihi District while we
continue to target further expansion through exploration. The
market release of the Waihi District Study is expected in the
second or third quarter. At Macraes, the Golden Point Underground
Study continues to progress, and we expect the results to be
released in the second half of the year."
"We maintain our 2020 guidance, however we acknowledge that the
continued risks associated with COVID-19 remain elevated and could
further impact our operational performance. We will continue to
monitor these risks while strictly enforcing the protocols and
safeguards we have in place at each of our operations which have
proven successful to-date."
Table 1 – Production and Cost Results Summary
Quarter ended 31 Mar
2020
|
|
Haile
|
Didipio
|
Waihi
|
Macraes
|
Consolidated
|
Q1 2020
|
Q4 2019
|
Gold
Produced
|
koz
|
29.4
|
-
|
12.2
|
39.2
|
80.7
|
108.2
|
Gold Sales
|
koz
|
33.3
|
6.8
|
13.5
|
37.8
|
91.4
|
107.3
|
Average Gold
Price
|
US$/oz
|
1,581
|
1,652
|
1,572
|
1,595
|
1,509(1)
|
1,404(1)
|
Copper
Produced
|
kt
|
-
|
-
|
-
|
-
|
-
|
0.1
|
Copper
Sales
|
kt
|
-
|
-
|
-
|
-
|
-
|
-
|
Average Copper
Price
|
US$/lb
|
-
|
-
|
-
|
-
|
-
|
-
|
|
|
|
|
|
|
|
|
Material
Mined
|
kt
|
8,602
|
-
|
52
|
12,531
|
21,185
|
19,923
|
Waste
Mined
|
kt
|
7,941
|
-
|
-
|
10,898
|
18,839
|
16,617
|
Ore Mined
|
kt
|
661
|
-
|
52
|
1,636
|
2,346
|
3,306
|
Mill Feed
|
kt
|
869
|
-
|
57
|
1,338
|
2,264
|
2,449
|
Mill Feed
Grade
|
g/t
|
1.36
|
-
|
7.44
|
1.12
|
1.37
|
1.59
|
Gold
Recovery
|
%
|
77.3
|
-
|
87.9
|
81.6
|
80.9
|
86.4
|
|
|
|
|
|
|
|
|
Cash Costs
|
US$/oz
|
1,147
|
443
|
432
|
695
|
802
|
757
|
All-In Sustaining
Costs(2)
|
US$/oz
|
1,551
|
444
|
376
|
1,218
|
1,218
|
980
|
(1)
|
Realised gains and
losses on gold hedging are included in the consolidated average
gold price.
|
(2)
|
Site AISC are
exclusive of Corporate general and administrative expenses and have
been restated in prior periods accordingly; Consolidated AISC is
inclusive of Corporate general and administrative
expenses.
|
Table 2 – Financial Summary
|
|
|
|
Quarter ended 31 Mar
2020
|
Q1
|
Q4
|
Q1
|
(US$m)
|
31 Mar
2020
|
31 Dec
2019
|
31 Mar
2019
|
Revenue
|
138.2
|
152.1
|
179.5
|
Cost of sales,
excluding depreciation and amortization
|
(74.0)
|
(81.5)
|
(101.0)
|
General and
administration – other
|
(19.4)
|
(22.4)
|
(11.6)
|
General and
administration – indirect
taxes (1)
|
(1.2)
|
(3.4)
|
(2.8)
|
Foreign currency
exchange gain/(loss)
|
(1.3)
|
0.2
|
(0.2)
|
Other
income/(expense)
|
0.1
|
0.2
|
0.5
|
EBITDA (excluding
gain/(loss) on undesignated hedges and impairment charge)
|
42.4
|
45.2
|
64.4
|
Depreciation and
amortization
|
(50.1)
|
(50.1)
|
(40.4)
|
Net interest expense
and finance costs
|
(2.8)
|
(3.0)
|
(3.6)
|
Earnings before
income tax (excluding gain/(loss) on undesignated hedges
and
impairment
charge)
|
(10.5)
|
(7.9)
|
20.4
|
Income tax (expense)/
benefit on earnings
|
(0.2)
|
7.2
|
(4.4)
|
Earnings after
income tax and before gain/(loss) on undesignated hedges
and
impairment
charge
|
(10.7)
|
(0.7)
|
16.0
|
Write off deferred
exploration expenditure / investment
|
-
|
(4.0)
|
(4.6)
|
Gain/(loss) on fair
value of undesignated hedges
|
(21.2)
|
18.6
|
1.4
|
Tax (expense) /
benefit on gain/loss on undesignated hedges
|
5.9
|
(5.2)
|
(0.4)
|
Share of loss from
equity accounted associates
|
-
|
(0.1)
|
(0.0)
|
Net
Profit/(loss)
|
(26.0)
|
8.7
|
12.4
|
Basic earnings/(loss)
per share
|
$(0.04)
|
$0.01
|
$0.02
|
Diluted
earnings/(loss) per share
|
$(0.04)
|
$0.01
|
$0.02
|
(3)
|
Represents
production-based taxes in the Philippines specifically excise tax,
local business and property taxes.
|
(4)
|
The Company did
not record any revenue or cost of sales from the Didipio mine
during the second half of 2019. In addition, General and
Administration - other, includes non-production costs related to
maintaining Didipio's operational readiness of $8.4 million in the
first quarter of 2020 compared to $10.1 million in the fourth
quarter in 2019.
|
Table 3 – Cash Flow Summary
|
|
|
|
Quarter ended 31 Mar
2020
(US$m)
|
Q1
31 Mar
2020
|
Q4
31 Dec
2019
|
Q1
31 Mar
2019
|
Cash flows from
Operating Activities
|
120.6
|
46.7
|
39.0
|
Cash flows used in
Investing Activities
|
(33.8)
|
(51.4)
|
(57.9)
|
.Cash flows from /
(used) in Financing Activities
|
44.8
|
(4.3)
|
(2.6)
|
Operations
For the quarter ended March 31,
2020, the Company produced 80,707 ounces of gold and 54,134
ounces of silver. Quarter-on-quarter gold production decreased 25%
due to planned lower production from Haile and Macraes, while Waihi
completed mining of Correnso underground in February. Didipio
remained in a state of operational readiness.
Increasing consolidated cash costs of $802 per ounce and All-in Sustaining Costs
("AISC") of $1,218 per ounce
reflected the lower production (and sales) profile and higher
capitalised pre-stripping quarter-on-quarter. The Company recorded
gold sales of 91,388 ounces in the first quarter, a 15% decrease
from the fourth quarter of 2019.
Financial
In the three months ended March 31,
2020, the Company generated $138.2
million in revenue, a decrease quarter-on-quarter mainly due
to planned lower gold sales, partially offset by a 7% increase in
the average gold price received. Year-over-year revenue decreased
on lower gold sales from the New
Zealand assets as expected and limited sales from Didipio,
partly offset by higher sales from Haile.
First quarter EBITDA of $42.4
million decreased slightly quarter-on-quarter, reflecting
lower sales volume combined with currency translation losses,
partially offset a higher average old price and lower general and
administrative costs and indirect taxes. The year-over-year
decrease in EBITDA largely reflected the absence of sales from
Didipio and higher general and administrative expenses related to
maintaining Didipio in a state of operational readiness.
Net loss before unrealised losses on undesignated hedges was
$10.7 million or $(0.02) per share on a fully diluted basis. The
quarter-on-quarter decrease was mainly a function of the lower
EBITDA and a one-off tax credit included in the prior period.
Operating cash flows in the first quarter were $120.6 million, an increase quarter-on-quarter
and year-over-year, mainly attributable to $78.5 million received from the presale of 48,000
gold ounces during the quarter. Fully diluted cash flow per share
before working capital was $0.07
excluding gold presales.
Investing cash flows included higher quarter-on-quarter capital
expenditure consistent with planned increases in capitalised
pre-strip at Macraes and Haile plus growth expenditure for the
Martha Underground development. This increase was offset by
$22.7 million received from the sale
of the Company's non-core equity position in Gold Standard
Ventures.
During the quarter, the Company drew down the remaining
$50.0 million under its revolving
credit facility to increase cash reserves and reduce credit market
risk given the volatility related to COVID-19. The Company has
fully drawn down its $200.0 million
facility, which currently matures on December 31, 2021.
As at March 31, 2020, the
Company's cash balance stood at $177.4
million. Net debt decreased to $121.1
million from the increased operating cash flow partially
offset by an increase in total equipment leases.
Conference Call
The Company will host a conference call / webcast to discuss the
financial and operating results at 7:30 am on Friday May 15, 2020 (Melbourne, Australian Eastern Standard Time) /
5:30 pm on Thursday May 14, 2020
(Toronto, Eastern Daylight
Time).
Webcast Participants
To register, please copy and paste the link below into your
browser:
https://produceredition.webcasts.com/starthere.jsp?ei=1303401&tp_key=7253372de9
Teleconference Participants (required for those who wish to
ask questions)
Local (toll free) dial in numbers are:
North America: 1 888 390
0546
Australia: 1 800 076 068
United Kingdom: 0 800 652
2435
Switzerland: 0 800 312 635
All other countries (toll): + 1 416 764 8688
Playback of Webcast
If you are unable to attend the call, a recording will be
available for viewing on the Company's website.
Authorised for release to market by OceanaGold Corporate Company
Secretary, Liang Tang.
www.oceanagold.com | Twitter: @OceanaGold
About OceanaGold
OceanaGold Corporation is a mid-tier, high-margin, multinational
gold producer with assets located in the
Philippines, New Zealand
and the United States. The
Company's assets encompass the Didipio Gold-Copper Mine located on
the island of Luzon in the
Philippines. On the North Island of New Zealand, the Company operates the
high-grade Waihi Gold Mine while on the South Island of
New Zealand, the Company operates
the largest gold mine in the country at the Macraes Goldfield which
is made up of a series of open pit mines and the Frasers
underground mine. In the United
States, the Company operates the Haile Gold Mine, a
top-tier, long-life, high-margin asset located in South Carolina. OceanaGold also has a
significant pipeline of organic growth and exploration
opportunities in the Americas and Asia-Pacific regions.
OceanaGold has operated sustainably since 1990 with a proven
track-record for environmental management and community and social
engagement. The Company has a strong social license to operate and
works collaboratively with its valued stakeholders to identify and
invest in social programs that are designed to build capacity and
not dependency.
For 2020, and subject to the cautionary statement below, the
Company expects to produce between 360,000 and 380,000 ounces of
gold from Haile, Waihi and Macraes combined at a consolidated
All-In Sustaining Costs ranging from $1,075 to $1,125
per ounce sold.
Cautionary Statement for Public Release
Certain information contained in this public release may be
deemed "forward-looking" within the meaning of applicable
securities laws. Forward-looking statements and information relate
to future performance and reflect the Company's expectations
regarding the generation of free cash flow, achievement of
guidance, execution of business strategy, future growth, future
production, estimated costs, results of operations, business
prospects and opportunities of OceanaGold Corporation and its
related subsidiaries. Any statements that express or involve
discussions with respect to predictions, expectations, beliefs,
plans, projections, objectives, assumptions or future events or
performance (often, but not always, using words or phrases such as
"expects" or "does not expect", "is expected", "anticipates" or
"does not anticipate", "plans", "estimates" or "intends", or
stating that certain actions, events or results "may", "could",
"would", "might" or "will" be taken, occur or be achieved) are not
statements of historical fact and may be forward-looking
statements. Forward-looking statements are subject to a variety of
risks and uncertainties which could cause actual events or results
to differ materially from those expressed in the forward-looking
statements and information. They include, among others, the
outbreak of an infectious disease, the accuracy of mineral reserve
and resource estimates and related assumptions, inherent operating
risks and those risk factors identified in the Company's most
recent Annual Information Form prepared and filed with securities
regulators which is available on SEDAR at www.sedar.com under the
Company's name. There are no assurances the Company can fulfil
forward-looking statements and information. Such forward-looking
statements and information are only predictions based on current
information available to management as of the date that such
predictions are made; actual events or results may differ
materially as a result of risks facing the Company, some of which
are beyond the Company's control. Although the Company believes
that any forward-looking statements and information contained in
this press release is based on reasonable assumptions, readers
cannot be assured that actual outcomes or results will be
consistent with such statements. Accordingly, readers should not
place undue reliance on forward-looking statements and information.
The Company expressly disclaims any intention or obligation to
update or revise any forward-looking statements and information,
whether as a result of new information, events or otherwise, except
as required by applicable securities laws. The information
contained in this release is not investment or financial product
advice.
SOURCE OceanaGold Corporation