VANCOUVER, BRITISH COLUMBIA - May 15, 2013 (Investorideas.com Mining Stocks Newswire) SilverCrest Mines Inc. (
TSX.V:SVL) (
NYSE MKT: SVLC) (
CW5.F)
("SilverCrest" or the "Company") is pleased to announce its financial
results for the first quarter ended March 31, 2013. All financial
information is prepared in accordance with IFRS and all dollar amounts
are expressed in U.S. dollars unless otherwise specified. The
information in this news release should be read in conjunction with the
Company's unaudited condensed consolidated interim financial statements
for the three months ended March 31, 2013 and associated management
discussion and analysis ("MD&A") which are available from the
Company's website at www.silvercrestmines.com and under the Company's
profile on SEDAR at www.sedar.com.
J. Scott Drever, President stated; "We are pleased with the steady
start to 2013, for which operating costs and production were consistent
with budget and mine plan, however, our financial performance in
comparison to the extraordinary stellar first quarter of 2012, was
impacted by lower metal prices and our decision to accelerate waste
removal resulting in less ore processed and ultimately fewer ounces of
gold sold compared to the first quarter 2012. Our operating team
continues to tightly control operating costs, which resulted in the
average cash operating cost of ($7.69) per ounce during the first
quarter which was less than the corporate guidance of $8.50 per silver
equivalent ounce. We are comfortable that, as the strip ratio declines
during the second half of 2013 and the ore grades in the pit continue to
increase, we will meet our corporate market guidance of 625,000 ounces
of silver and 33,000 ounces of gold for 2013."
FINANCIAL HIGHLIGHTS OF Q1, 2013, Compared to Q1, 2012:
- Cash flow from operations (1) decreased 28% to $8.8 million ($0.08 per share).
- Cash operating cost per silver equivalent ounce sold (2) increased 10% to $7.69, but below market guidance of $8.50.
- Revenues reported - IFRS (3) decreased 22% to $15.3 million.
- Metal sales of 157,088 ounces of silver were up 12% and 7,370 ounces of gold were down 25%.
- Bullion inventory at March 31, 2013, included 43,278 ounces of silver and 2,106 ounces of gold.
- Realized spot metal prices were down for ounces sold - silver price fell 12% and gold price fell 5%.
- Net earnings were similar at $6.0 million ($0.06 per share), compared to $6.1 million ($0.07 per share).
- Cash, cash equivalents and short term investments were $41.1 million - Working capital was $48.9 million (at March 31, 2013).
Comparison of the three months ended March 31, 2013 to March 31, 2012
Net earnings were $6,002,276 ($0.06 per share basic) for the first
quarter, consistent with $6,070,520 ($0.07 per share basic) in the first
quarter of 2012.
Silver and gold revenues totalled $15,329,642 (2012 - $19,599,570)
in the first quarter. Silver and gold revenues on a cash basis decreased
by 17% to $14,776,451 (2012 - $17,776,691), primarily from a reduction
in the number of gold ounces sold and lower realized spot prices.
Silver sales for the quarter were 157,088 ounces (2012 - 139,771),
or 12% higher than the same period in 2012, but the average realized
price was 12% lower at $30 (2012 - $34) per ounce. Total gold sales were
7,370 ounces (2012 - 9,788) or 25% below 2012. The Company sold 5,896
spot gold ounces (2012 - 6,471) at lower market spot realized prices of
$1,626 (2012 - $1,720) per ounce. The Company delivered 1,474 gold
ounces (2012 - 1,958) to Sandstorm at $350 per ounce.
Cost of sales amounted to $4,368,519 (2012 - $4,491,131). The cash
cost per silver equivalent ounce sold amounted to $7.69, Au:Ag 55.8:1
(2012 - $7.00, Au:Ag 51.2:1). Corporate market guidance estimate for
2013 continues at $8.50 per silver equivalent ounce, (Au:Ag 55:1). The
increase in cash cost per silver equivalent ounce sold was driven by
higher operating costs during the second half of 2012 and lower gold
sales, which corresponded to an increase in the average silver
equivalent ounce value loaded on the leach pad and recorded in cost of
sales. The overall cash cost per silver equivalent ounce increased,
despite a decrease of approximately $0.50 per silver equivalent ounce
from a lower silver to gold price ratio during the first quarter
compared with the same quarter in 2012.
General and administrative expenses increased by 14% to $1,340,926
(2012 - $1,172,197) primarily due to an increase in regulatory expense
and remuneration, resulting from the addition of new Corporate personnel
and increased compensation for management.
(1) Cash flow from operations before changes in working capital items. This is a Non-IFRS performance measure.
(2) Silver equivalent ounces consist of the number of ounces of
silver sold plus the number of ounces of gold sold multiplied by the
ratio of the spot gold price to the spot silver price at the quarter end
dates (Q1 2013; 55.8:1, Q1 2012; 51.2:1).
(3) IFRS 18 - Revenue should be recorded at its fair value, which
for gold and silver is the market spot price on the date revenue is
recognized.
(4) The MBL Hedging Facility was fully repaid in fiscal 2012, so this non-cash adjustment has now been eliminated.
NON-IFRS PERFORMANCE MEASURES
The discussion of financial results in this press release includes
reference to cash operating cost per silver equivalent ounce sold which
is a non-IFRS performance measure. The Company presents this measure to
provide additional information regarding the Company's financial results
and performance. Please refer to the Company's MD&A for the three
months ended March 31, 2013, for a reconciliation of this measure to
reported IFRS results.
OUTLOOK FOR 2013
SilverCrest's immediate focus is to continue to efficiently operate
its flagship Santa Elena low cost open pit silver and gold mine,
complete the construction of a new 3,000 tonne-per-day mill facility on
schedule and on budget, and complete an update of the Santa Elena
Resources, Reserves and Life of Mine Plan ("LOMP"). The Company will
also advance the delineation of the large silver, copper, gold deposit
at the La Joya Property by completing a PEA and further definition
drilling of additional resources at La Joya and other exploration
targets in its vicinity.
Santa Elena Open Pit Production Targets
- Meet estimated 2013 production of 625,000 ounces of silver and
33,000 ounces of gold (2.4 million ounces of silver equivalent, Ag:Au
55:1) (Q1 2013; 153,481 silver ounces and 7,225 gold ounces or 556,671
ounces of silver equivalent, Ag:Au 55.8:1).
- Achieve estimated 2013 direct operating costs of $20.7 million (Q1 2013; $5.4million).
- Maintain estimated cash operating cost of $8.50 per ounce silver
equivalent sold (Ag:Au 55:1). (Q1 2013; $7.69 per ounce silver
equivalent).
- Limit estimated operational sustaining capital expenditure to $1.0 million. (Q1 2013; approx $0.4 million incurred).
Santa Elena Expansion Targets
- Complete construction of new conventional 3,000 tpd CCD processing
facility on schedule and on budget - Capital assigned for 2013 is $53.2
million. (Q1 2013; approx $25.5 million committed and $10.7m incurred).
- Complete underground decline development of main ramp to 1,500
metres to enable physical access to ore underground for direct mill feed
in 2014 - Capital assigned for 2013 is $7.8 million. (Q1 2013; approx
$0.8m incurred).
- Complete Pre-Feasibility Study on Expansion Plan (mill,
underground and re-processing leach pad material), including Resources,
Reserve and LOMP revisions.
- Complete surface drilling of approximately 15,000 metres to expand
additional resources and reclassify to reserves - Capital assigned for
2013 is $3.2 million. (Completed: Q1 2013; approx 20,850 metres and $3.0
million incurred, additional drilling of approx 7,000 metres was
completed based on success of further discoveries).
- Systematic and aggressive review of new targets near Santa Elena
for acquisition and exploration. Subsequent to March 31, 2013 a new
property ("San Juan") was acquired (100%) at minimal cost that is
approximately 45 kilometres from the Santa Elena Mine. The San Juan Mine
was a past producer with reported silver grades over 1 kilogram per
tonne. This property is being evaluated for initial drilling in 2013.
Mapping and surface sampling results to date show a mineralized system
over 3 kilometres along strike with multiple near surface silver-gold
targets. Capital assigned for 2013 is minimal and is covered under a
general Mexico reconnaissance budget of $1.0 million.
La Joya Project Targets
- File Updated Resource Estimate NI43-101 Technical Report in Q1 2013 with initial positive metallurgical results. (Completed).
- Complete and File a PEA NI43-101 Technical Report evaluating the
high grade portion of the deposit as a potential "Starter" Pit.
(Commenced).
- Complete Phase III drilling program revised to approximately 40
core and reverse circulation drill holes for in-fill and expansion of
current resources. (Capital assigned for 2013 revised to $3 million).
- Complete final staged payments of approximately $4.0 million under
the La Joya agreements to acquire 100% of the 10 mineral concessions
under option. The final payments can be made by a combination of cash
and shares.
- Continue to Explore the Coloradito, La Esperanza and Santo Nino targets, which are adjacent to the Main Mineralized Trend.
- Explore geophysical targets, La Paloma and El Pino within the current land position.
The Qualified Person under National Instrument (NI 43-101)
Standards of Disclosure for Mineral Projects for this News Release is N.
Eric Fier, CPG, P.Eng, and Chief Operating Officer for SilverCrest
Mines Inc., who has reviewed and approved its contents.
SilverCrest Mines Inc. (TSX-V: SVL; NYSE MKT: SVLC)
is a Canadian precious metals producer headquartered in Vancouver, BC.
SilverCrest's flagship property is the 100%-owned Santa Elena Mine,
located 150 km northeast of Hermosillo, near Banamichi in the State of
Sonora, Mexico. The mine is a high-grade, epithermal gold and silver
producer, with an estimated life of mine cash cost of US$8 per ounce of
silver equivalent (55:1 Ag:Au). SilverCrest anticipates that the 2,500
tonnes per day facility should recover approximately 4,805,000 ounces of
silver and 179,000 ounces of gold over the 6.5 year life of the open
pit phase of the Santa Elena Mine. A three year expansion plan is
underway to double metals production at the Santa Elena Mine and
exploration programs are rapidly advancing the definition of a large
polymetallic deposit at the La Joya property in Durango State.
FORWARD-LOOKING STATEMENTS
This news release contains "forward-looking statements" within the
meaning of Canadian securities legislation and the United States
Securities Litigation Reform Act of 1995. Such forward-looking
statements concern the Company's anticipated results and developments in
the Company's operations in future periods, planned exploration and
development of its properties, plans related to its business and other
matters that may occur in the future. These statements relate to
analyses and other information that are based on expectations of future
performance, including silver and gold production and planned work
programs. Statements concerning reserves and mineral resource estimates
may also constitute forward-looking statements to the extent that they
involve estimates of the mineralization that will be encountered if the
property is developed and, in the case of mineral reserves, such
statements reflect the conclusion based on certain assumptions that the
mineral deposit can be economically exploited.
Forward-looking statements are subject to a variety of known and
unknown risks, uncertainties and other factors which could cause actual
events or results to differ from those expressed or implied by the
forward-looking statements, including, without limitation: risks related
to precious and base metal price fluctuations; risks related to
fluctuations in the currency markets (particularly the Mexican peso,
Canadian dollar and United States dollar); risks related to the
inherently dangerous activity of mining, including conditions or events
beyond our control, and operating or technical difficulties in mineral
exploration, development and mining activities; uncertainty in the
Company's ability to raise financing and fund the exploration and
development of its mineral properties; uncertainty as to actual capital
costs, operating costs, production and economic returns, and uncertainty
that development activities will result in profitable mining
operations; risks related to reserves and mineral resource figures being
estimates based on interpretations and assumptions which may result in
less mineral production under actual conditions than is currently
estimated and to diminishing quantities or grades of mineral reserves as
properties are mined; risks related to governmental regulations and
obtaining necessary licenses and permits; risks related to the business
being subject to environmental laws and regulations which may increase
costs of doing business and restrict our operations; risks related to
mineral properties being subject to prior unregistered agreements,
transfers, or claims and other defects in title; risks relating to
inadequate insurance or inability to obtain insurance; risks related to
potential litigation; risks related to the global economy; risks related
to the Company's status as a foreign private issuer in the United
States; risks related to all of the Company's properties being located
in Mexico and El Salvador, including political, economic, social and
regulatory instability; and risks related to officers and directors
becoming associated with other natural resource companies which may give
rise to conflicts of interests. Should one or more of these risks and
uncertainties materialize, or should underlying assumptions prove
incorrect, actual results may vary materially from those described in
the forward-looking statements. The Company's forward-looking statements
are based on beliefs, expectations and opinions of management on the
date the statements are made. For the reasons set forth above, investors
should not place undue reliance on forward-looking statements.
The information provided in this news release is not intended to be
a comprehensive review of all matters and developments concerning the
Company. It should be read in conjunction with all other disclosure
documents of the Company. The information contained herein is not a
substitute for detailed investigation or analysis. No securities
commission or regulatory authority has reviewed the accuracy or adequacy
of the information presented.
J. Scott Drever, President
SILVERCREST MINES INC.
Contact:
SilverCrest Mines Inc.
Fred Cooper
(604) 694-1730 ext. 108
Toll Free: 1-866-691-1730
(604) 694-1761 (FAX)
info@silvercrestmines.comwww.silvercrestmines.com570 Granville Street, Suite 501
Vancouver, British Columbia V6C 3P1
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As reported in the Company's Quarterly Report on Form 10-Q for the
period ending March 31, 2013, Current Assets increased by approximately
$796,000 to approximately $2,540,000 from the previous quarter ended
December 31, 2012. The Company's Stockholder's Equity (Total Assets
minus Total Liabilities) decreased by approximately $63,000 to
approximately $808,000, sequentially from the previous quarter ended
December 31, 2012. These balance sheet changes were the result of
increased revenues and cash flow partially offset by expansion costs and
other one-time expenses.
The first quarter revenues exceeded the earlier estimate made by
the Company's preliminary Q1, 2013 results press release by more than
18%. The full discussion of the Company's financial results is
available within the Company's Quarterly Report on Form 10-Q filed May
15, 2013.
For more information, management's analysis of its financial
information and the Company's risk factors, please read the Company's
First Quarter 2013 Quarterly Report on Form 10-Q and its 2012 Annual
Report on Form 10-K at the Edgar web site at www.SEC.gov and