Monument Mining Limited (TSX-V: MMY and FSE: D7Q1) “Monument” or
the “Company” today announced its second quarter production and
financial results for the six months ended December 31, 2020. All
amounts are expressed in United States dollars (“US$”) unless
otherwise indicated (refer to www.sedar.com for full financial
results).
President and CEO Cathy Zhai commented: “During
the first six months of fiscal 2021, the Company has completed the
economic valuation of each of its wholly-owned projects, closed the
Tuckanarra JV Transaction, and streamlined the gold portfolio by
entering into the definitive agreement to sell the Mengapur base
metal project subsequent to the second quarter. Upon closing the
Mengapur transaction, the Company’s strategy will be to “Unblock
the Value” with the proceeds from the transaction available to
advance the Company’s gold portfolio in Western Australia and
Malaysia, and to support corporate development.”
Second Quarter Highlights:
- 3,754 ounces (“oz”) of gold sold
for $6.84 million (Q2 2020: 4,473oz for $6.61 million);
- Average quarterly gold price
realized at $1,889/oz (Q2 2020: $1,486/oz);
- Cash cost per ounce sold was
$1,103/oz (Q2 2020: $903/oz);
- Gross margin increased by 5% to
$2.69 million (Q2 2020: $2.57 million);
- 2,963oz of gold produced (Q2 2020:
4,827oz);
- All-in sustaining cost (“AISC”)
increased to $1,601/oz (Q2 2020: $1,245/oz);
- Sold 80% interest in Tuckanarra
Project to Odyssey to advance exploration; and
- Completed due diligence on the
Mengapur Transaction.
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Three months endedDecember31, |
Six months endedDecember 31, |
|
2020 |
2019 |
2020 |
2019 |
Production |
|
|
|
|
Ore mined (t) |
112,073 |
88,255 |
193,649 |
135,052 |
Ore processed (t) |
152,836 |
215,305 |
319,268 |
449,334 |
Average mill feed grade
(g/t) |
0.89 |
0.98 |
0.94 |
0.98 |
Processing recovery rate
(%) |
58% |
66% |
61% |
69% |
Gold recovery (oz) |
2,560 |
4,456 |
5,903 |
9,783 |
Gold production (1) (oz) |
2,963 |
4,827 |
6,467 |
9,679 |
Gold sold (oz) |
3,754 |
4,473 |
6,854 |
8,796 |
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|
Financial (expressed in
thousands of US$) |
$ |
$ |
$ |
$ |
Revenue |
6,835 |
6,606 |
12,754 |
12,949 |
Gross margin from mining
operations |
2,694 |
2,566 |
5,753 |
5,213 |
Income before other items |
1,159 |
653 |
3,102 |
1,399 |
Net loss |
(649) |
(1,829) |
(511) |
(1,621) |
Cash flows (used in) provided
by operations |
796 |
(783) |
1,543 |
429 |
Working capital |
20,384 |
20,351 |
20,384 |
20,351 |
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Loss
per share – basic and diluted (US$/share) |
(0.00 ) |
(0.01) |
(0.00) |
(0.01) |
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Three months endedDecember 31, |
Six months endedDecember 31, |
|
2020 |
2019 |
2020 |
2019 |
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|
Other |
US$/oz |
US$/oz |
US$/oz |
US$/oz |
Average realized gold price
per ounce sold (2) |
1,889 |
1,486 |
1,899 |
1,481 |
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Cash cost per ounce sold: |
|
|
|
|
Mining |
365 |
230 |
323 |
205 |
Processing |
552 |
527 |
520 |
532 |
Royalties |
172 |
135 |
168 |
129 |
Operations, net of silver
recovery |
14 |
11 |
10 |
14 |
Total cash cost per
ounce sold |
1103 |
903 |
1021 |
880 |
By-product silver recovery |
1 |
1 |
1 |
1 |
Operation expenses |
40 |
0 |
26 |
0 |
Corporate expenses |
104 |
111 |
96 |
124 |
Accretion of asset retirement obligation |
9 |
10 |
10 |
11 |
Exploration and evaluation expenditures |
19 |
49 |
15 |
49 |
Sustaining capital expenditures |
324 |
170 |
219 |
198 |
By-product silver recovery |
1 |
1 |
1 |
1 |
Total all-in sustaining costs per ounce sold |
1,601 |
1,245 |
1,389 |
1,264 |
(1) |
Defined as good delivery gold bullion according to London Bullion
Market Association (“LBMA”), net of gold doŕe in transit and
refinery adjustment. |
(2) |
Monument realized 1,889US$/oz and 1,899US$/oz for the three months
and six months ended December 31, 2020. |
(3) |
Total cash cost per ounce includes production costs such as mining,
processing, tailing facility maintenance and camp administration,
royalties and operating costs such as storage, temporary mine
production closure, community development cost and property fees,
net of by-product credits. Cash cost excludes amortization,
depletion, accretion expenses, idle production costs, capital
costs, exploration costs and corporate administration costs.
Readers should refer to section 14 “Non-IFRS Performance
Measures”. |
|
|
All-in sustaining
cost per ounce includes total cash costs and adds sustaining
capital expenditures, corporate administrative expenses for the
Selinsing Gold Mine including share-based compensation, exploration
and evaluation costs, and accretion of asset retirement
obligations. Certain other cash expenditures, including tax
payments and acquisition costs, are not included. Readers should
refer to section 14 “Non-IFRS Performance Measures”. |
Production Analysis
- Q2 2021 gold production of 2,963oz,
a 39% decrease as compared to 4,827oz of Q2 2020. For the six
months ended December 31, 2020, gold production of 6,467oz, a 33%
decrease as compared to 9,679oz for the six months ended December
31, 2019. The decrease mainly resulted from reduction in mill feed
caused by shortage of crushed ore and lower recovery rate brought
about by gold locked in leachable sulphide ore and gold taken from
circuit with lower Au loading in carbon.
- Q2 2021 ore processed decreased to
152,836t from 215,305t of Q2 2020. For the six months ended
December 31, 2020, ore processed decreased to 319,268oz from
449,334oz for the six months ended December 31, 2019. The decreased
mill feed was mainly due to crushed ore shortage from low mining
output, which was in turn caused by shortage of explosive supply,
and lack of stockpiled super low-grade oxide ore. Average mill feed
grade was 0.89g/t as compared to 0.98g/t of Q2 2020. For the six
months ended December 31, 2020, average mill feed grade was 0.94g/t
as compared to 0.98g/t for the six months ended December 31, 2019.
Q2 2021 processing recovery rate decreased to 58% from 66% of Q2
2020. For the six months ended December 31, 2020, processing
recovery rate decreased to 61% from 69% for the six months ended
December 31, 2019. The decrease in processing recovery rate was
mainly due to lower recoveries obtained from processing leachable
sulphide ore materials.
- Q2 2021 cash cost per ounce
increased by 22% to $1,103/oz from $903/oz of Q2 2020. For the six
months ended December 31, 2020, cash cost per ounce increased by
16% to $1,021/oz from $880/oz for the six months ended December 31,
2019. The increase was mainly due to additional mining services of
pit dewatering, establishing Peranggih mining and hauling ore to
Selinsing, additional reagents, processing time and energy required
in leaching sulphide materials and lower mining rate with
relatively fixed overheads.
- Ore stockpile has reduced mainly
due to adverse impact from shortage of explosive supply resulting
in lower mining rate that has yet to be caught up. COVID-19
pandemic has not helped in achieving the target. The Company has
devoted its effort to improve the stockpile balance.
Financial Analysis
- Q2 2021 gold sales generated
revenue was $6.84 million as compared to $6.61 million from Q2
2020. Gold sales revenue was derived from the sale of 3,754oz (Q2
2020: 4,473oz) of gold at an average realized gold price of $1,889
per ounce (Q2 2020: $1,486 per ounce) and the delivery of 704 oz
(Q2 2020: 723oz) in fulfilling gold prepaid obligations at an
average London Fix PM gold price of $1,525 per ounce (Q2 2020:
$1,429 per ounce). For the six months ended December 31, 2020, gold
sales revenue was $12.75 million as compared to $12.95 million for
the six months ended December 31, 2019. For the six months ended
December 31, 2020, gold sales revenue was derived from the sale of
6,854oz (six months ended December 31, 2019: 8,796oz) of gold at an
average realized gold price of $1,899 per ounce (six months ended
December 31, 2019: $1,481 per ounce) and the delivery of 704oz (six
months ended December 31, 2019: 1,446oz) in fulfilling gold prepaid
obligations at an average London Fix PM gold price of $1,525 per
ounce (Q2 2020: $1,429 per ounce).
- Q2 2021 total production costs
increased by 3% to $4.14 million as compared to $4.04 million from
Q2 2020. For the six months ended December 31, 2020, total
production costs decreased by 10% to $7.00 million as compared to
$7.74 million for the six months ended December 31, 2019. The
increase/decrease is in line with the increase/decrease in gold
sales revenue and reflected timing difference of gold sold and
higher mining and processing costs as compared to the same period
last year.
- Gross margin for Q2 2021 was $2.69
million before operation expenses and non-cash amortization and
accretion. That represented a 5% increase as compared to $2.57
million from Q2 2020. Gross margin for the six months ended
December 31, 2020 was $5.73 million, a 10% increase as compared to
$5.21 million for the six months ended December 31, 2019. The
increase in gross margin was attributable to an increase in a
higher average realized gold price but offset by less gold sold and
higher mining and processing costs.
- Net loss for Q2 2021 was $0.65
million, or ($0.00) per share as compared to net loss of $1.83
million or ($0.01) per share from Q2 2020. Net loss for the six
months ended December 31, 2020 was $0.51 million or ($0.00) per
share as compared to net loss of $1.62 million or ($0.01) per share
from the six months ended December 31, 2019. The variance was
caused by higher income from mining operations.
- Cash and cash equivalents balance
as at December 31, 2020 was $14.57 million, an increase of $4.44
million from the balance at June 30, 2020 of $10.13 million. As at
December 31, 2020, the Company had positive working capital of
$20.38 million which was comparable to that at June 30, 2020 of
$18.79 million.
- Cash provided from operating
activities for Q2 2021 was $0.80 million (Q2 2020: cash used in
operating activities of $0.78 million) For the six months ended
December 31, 2020, cash provided from operating activities was
$1.54 million (six months ended December 31, 2019: $0.43
million).
Development
Selinsing Gold Mine
During the second quarter, Selinsing gold mine
prioritized flotation plant construction as the first phase of the
sulphide gold production project. Orway Mineral Consultants have
been engaged to optimize the flotation conceptual design based on
the completed feasibility study work in order to produce saleable
gold concentrates. The onsite laboratory continued test work for
bioleach inoculum adaptation and propagation stage on flotation
concentrate, including gravity recoverable gold (GRG) and carbon in
leach (CIL) tests on samples of external concentrates, bioleach
batch amenability test (BAT) on a selected sample of external
concentrate, CIL bottle roll test on the bioleach solid residue,
diagnostic leach tests on selected samples, cleaner flotation test
program on BRC3 transition ore and routine GRG and CIL testing of
Selinsing grade control samples.
Further development work was carried out on an
underground mining desktop study, TSF development, mining cutback
and test work for oxide mining assessment at Peranggih in order to
sustain Selinsing gold production.
Murchison Gold Project
Ongoing development work at Murchison aims to
optimize regional exploration target to establish Murchison and
potetail corner stone project, and assess early production
opportunity. The mine plan was completed by management and the
independent review carried out by SRK has continued into the third
quarter, covering but not limited to resource modelling, mining
optimization and scheduling, metallurgical recoveries and
compliance, targeting completion in March 2021. In parallel
geophysics from historical surveys (predominantly magnetics and EM)
for both Burnakura and Gabanintha were reviewed and exploration
target shapes, rankings and explanations were refined.
Transaction
During the quarter, in October 2020, the Company
entered into a Joint Venture Arrangement (the “Transaction”) with
Odyssey Gold Ltd (ASX: “ODY”), and the transaction closed in
December 2020. Pursuant to the Transaction, the Company sold 80% of
its interest in Tuckanarra Gold Project to Odyssey for an
aggregated consideration of AUD$5.00 million cash (or equivalent
$3.81 million), retains a 1% net smelter return royalty over ODY’s
percentage share, and a 20% interest in the Tuckanarra Gold Project
free carried until a decision to mine, provided preferentially
ODY’s gold ore will be processed through Monument’s Burnakura gold
plant subject to commercial terms. Odyssey and Monument will
jointly develop the Tuckanarra Gold Project through an
unincorporated joint venture to advance the Tuckanarra Gold Project
located in the Murchison Goldfield.
Exploration Progress
Malaysia
An exploration RC drill program was completed in
Q2 consisting of 947m over 14 holes at Pits 4, 5, and 6. The
program commenced in early December 2020, and will continue in Q3
2021 with additional 181m over four holes remaining to be drilled
in January 2021. A total of 1,051 samples were collected.
Significant high grade drilling interception from the program is as
follows: MSMRC 167; 1m @ 14.20g/t Au from 26m; MSMRC 179; 3m at
21.48g/t Au from 72m include 1m at 60.71g/t; and MSMRC 179; 17m at
2.10g/t Au from 5m. The drill program aims to identify
mineralization areas with average grades that can be mined
economically in the short run. Once those areas are defined,
materials will be mined to feed into the processing plant.
At the Peranggih Prospect, the shallow RAB
drilling program continued in October 2020. During the quarter, an
additional 12,591m of closed-spaced, 5x5m shallow GC holes with a
maximum depth of 10m were drilled to infill the existing gap and
extend the coverage of the surface mineralization along the 540m
strike length and sterilizing the waste material that is needed to
be removed for mining purposes. The ongoing GC drilling program
allowed identifying 82,674tons at 0.89g/t Au with 2,365oz contained
gold for a combined total of 154,785tons @ 0.89g/t Au with
4,418oz.
Western Australia
During the quarter, a grab sampling program was
completed at the Gabanintha project towards confirming the
historical JORC complaint resources. The program was completed on a
historical mining dump at Tumblegum Deposit. The grab samples
returned an average grade of 1.79g/t Au from ALS and comparative
results from Minanalytical, Canning Vale returned 1.77g/t Au via
the Chrysos Photon Assay technique. The material could form early
low cost ore feed in a mine startup. Organization of the geology
data on the server was further improved during the quarter and new
data rooms were generated for each of the projects. This will
greatly improve efficiencies which will be especially important as
Monument advances preparation for extensive exploration programs
and possible mine startup.
About Monument
Monument Mining Limited (TSX-V: MMY, FSE: D7Q1)
is an established Canadian gold producer that owns and operates the
Selinsing Gold Mine in Malaysia. Its experienced management team is
committed to growth and is advancing several exploration and
development projects including the Mengapur Copper-Iron Project, in
Pahang State of Malaysia, and the Murchison Gold Projects
comprising Burnakura, Gabanintha and 20% of Tuckanarra through a
joint venture in the Murchison area of Western Australia. The
Company employs approximately 200 people in both regions and is
committed to the highest standards of environmental management,
social responsibility, and health and safety for its employees and
neighboring communities.
Cathy Zhai, President and CEOMonument Mining
LimitedSuite 1580 -1100 Melville Street Vancouver, BC V6E 4A6
FOR FURTHER INFORMATION visit the company web
site at www.monumentmining.com or contact:
Richard Cushing, MMY Vancouver T:
+1-604-638-1661 x102 rcushing@monumentmining.com
"Neither TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in the policies of the
TSX Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release."
Forward-Looking Statement
This news release includes statements containing
forward-looking information about Monument, its business and future
plans (“forward-looking statements”). Forward-looking statements
are statements that involve expectations, plans, objectives or
future events that are not historical facts and include the
Company’s plans with respect to its mineral projects and the timing
and results of proposed programs and events referred to in this
news release. Generally, forward-looking information can be
identified by the use of forward-looking terminology such as
"plans", "expects" or "does not expect", "is expected", "budget",
"scheduled", "estimates", "forecasts", "intends", "anticipates" or
"does not anticipate", or "believes", or variations of such words
and phrases or state that certain actions, events or results "may",
"could", "would", "might" or "will be taken", "occur" or "be
achieved". The forward-looking statements in this news release are
subject to various risks, uncertainties and other factors that
could cause actual results or achievements to differ materially
from those expressed or implied by the forward-looking statements.
These risks and certain other factors include, without limitation:
risks related to general business, economic, competitive,
geopolitical and social uncertainties; uncertainties regarding the
results of current exploration activities; uncertainties in the
progress and timing of development activities; foreign operations
risks; other risks inherent in the mining industry and other risks
described in the management discussion and analysis of the Company
and the technical reports on the Company’s projects, all of which
are available under the profile of the Company on SEDAR at
www.sedar.com. Material factors and assumptions used to develop
forward-looking statements in this news release include:
expectations regarding the estimated cash cost per ounce of gold
production and the estimated cash flows which may be generated from
the operations, general economic factors and other factors that may
be beyond the control of Monument; assumptions and expectations
regarding the results of exploration on the Company’s projects;
assumptions regarding the future price of gold of other minerals;
the timing and amount of estimated future production; the expected
timing and results of development and exploration activities; costs
of future activities; capital and operating expenditures; success
of exploration activities; mining or processing issues; exchange
rates; and all of the factors and assumptions described in the
management discussion and analysis of the Company and the technical
reports on the Company’s projects, all of which are available under
the profile of the Company on SEDAR at www.sedar.com. Although the
Company has attempted to identify important factors that could
cause actual results to differ materially from those contained in
forward-looking statements, there may be other factors that cause
results not to be as anticipated, estimated or intended. There can
be no assurance that such statements will prove to be accurate, as
actual results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not
place undue reliance on forward-looking statements. The Company
does not undertake to update any forward-looking statements, except
in accordance with applicable securities laws.
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