Endeavour Posts Record Performance in Q4,
posted on
Jan 23, 2017 11:41AM
Unaudited Preliminary Financial and Operating Results
Endeavour Posts Record Performance in Q4, Meets 2016 Guidance and Expects Further Production Growth and AISC Reduction in 2017
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Q4 and Full Year 2016 Highlights:
2017 Outlook:
George Town, January 23, 2017 - Endeavour Mining (TSX:EDV) (OTCQX:EDVMF) is pleased to announce its preliminary financial and operating results for the fourth quarter and full year 2016, with highlights provided in the table below.
Table 1: Key Preliminary Operational and Financial Highlights
(All 2016 amounts exclude discontinued Youga operation, while 2015 amounts include Youga.) |
Units | Quarter ended, | Year ended December 31, | ||||||
Dec. 30, 2016 | Sept. 30, 2016 | Dec. 30, 2015 | 2016 | 2015 | Change | ||||
Gold Production | oz | 175, 146 | 146,425 | 136,844 | 583,712 | 516,646 | +13 | % | |
Realized Gold Price | $/oz | 1,205 | 1,328 | 1,102 | 1,240 | 1,157 | +7 | % | |
AISC | $/oz | ~865 | 898 | 934 | ~895 | 922 | (3 | %) | |
All-in Sustaining Margin | $/oz | ~340 | 430 | 168 | ~345 | 235 | +47 | % | |
All-in Sustaining Margin | $m | ~65 | 55 | 24 | ~190 | 122 | +55 | % | |
Free Cash Flow (before growth projects, WC, tax and financing cost) |
$m | ~50 | 41 | 12 | ~135 | 85 | +59 | % | |
Net Debt At Period End | $m | 25 | 14 | 144 | 25 | 144 | (83 | %) |
The preliminary Q4 2016 production and other financial information provided in this news release are approximate figures and may differ from the final results included in the 2016 annual audited statements and MD&A. Production shown inclusive of Karma's pre-commercial period. Karma's revenue, costs, and operating cash flow is netted against its capital costs for its pre-commercial production period ending September 30, 2016.
Sébastien de Montessus, President & CEO, stated: "I would like to acknowledge the hard work and dedication of our entire team for achieving our record performance in 2016 and improving all our key operating metrics as we met all of our guidance objectives for the year. As expected, our fourth quarter was our strongest with a record performance at Agbaou and Tabakoto, and the continued ramp-up at Karma.
In 2017, we are well positioned to continue to increase production and lower all-in sustaining costs even further, notably without the inclusion of organic growth benefits provided by our Houndé project which is progressing on-time and on-budget. Looking ahead, we remain focused on unlocking our organic growth potential which will be enhanced by a potential positive investment decision at the Ity CIL project and through our reinvigorated exploration program."
> 2016 Guidance Achieved with Record High Production & Record Low AISC
Table 2: Preliminary Production and AISC Compared to Guidance
(in koz on a 100% basis) | Production, koz | Preliminary AISC/oz | |||||||||
2016 Guidance |
2016 Actual |
2015 Actual | 2016 Guidance |
2016 (Preliminary) |
2015 Actual |
||||||
Agbaou | 180 | - | 195 | 196 | 181 | 550 | - | 600 | ~535 | 576 | |
Tabakoto | 155 | - | 175 | 163 | 152 | 970 | - | 1,050 | ~1,030 | 1,067 | |
Nzema | 90 | - | 100 | 88 | 110 | 1,050 | - | 1,125 | ~1,170 | 1,064 | |
Ity | 70 | - | 80 | 76 | 6 | 800 | - | 850 | ~790 | 683 | |
Karma* | 50 | - | 60 | 62 | - | 750 | - | 800 | ~750 | - | |
Youga (divested in March 2016) | Excluded | - | 68 | Excluded | - | 913 | |||||
Group | 575 | - | 610 | 584 | 517 | 870 | - | 920 | ~895 | 922 |
*Karma production shown inclusive of the pre-commercial period, while AISC stated for the commercial period
> Strong 2016 Finish with Record Quarterly Performance in Q4
Table 3: Preliminary Production and AISC
(All amounts in koz, on a 100% basis) | Quarter ended, | Year ended December 31, | ||||||
Q4-2016 | Q3-2016 | Q4-2015 | 2016 | 2015 | Change | |||
Agbaou | 57 | 49 | 52 | 196 | 181 | +8 | % | |
Tabakoto | 48 | 37 | 42 | 163 | 151 | +8 | % | |
Nzema | 24 | 24 | 23 | 88 | 110 | (20 | %) | |
Ity | 17 | 15 | 6 | 76 | 6 | n/a | ||
Karma (including pre-commercial production) | 29 | 20 | - | 62 | - | n/a | ||
Production from continuing operations | 175 | 146 | 123 | 584 | 449 | +30 | % | |
Youga (divested in March 2016) | Excluded | Excluded | 15 | Excluded | 68 | n/a | ||
Total Production | 175 | 146 | 138 | 584 | 517 | +13 | % |
Table 4: Group All-In Sustaining Costs, US$/oz
(All amounts in US$/oz) | Quarter ended, | Year ended December 31, | ||||||
Q4-2016 | Q3-2016 | Q4-2015 | 2016 | 2015 | Change | |||
Agbaou | ~535 | 550 | 537 | ~535 | 576 | (7 | %) | |
Tabakoto | ~930 | 1,071 | 1,119 | ~1,030 | 1,067 | (3 | %) | |
Nzema | ~1,120 | 1,136 | 1,133 | ~1,170 | 1,064 | +10 | % | |
Ity | ~850 | 724 | 683 | ~790 | 683 | +16 | % | |
Karma (commercial production) | ~750 | n/a | - | ~750 | - | n/a | ||
Youga (divested in March 2016) | Excluded | Excluded | 985 | Excluded | 913 | n/a | ||
Mine-level AISC | ~785 | 831 | 862 | ~830 | 868 | (4 | %) | |
Corporate G&A | ~55 | 47 | 56 | ~47 | 41 | +15 | % | |
Sustaining exploration | ~25 | 20 | 15 | ~18 | 13 | +38 | % | |
Group AISC | ~865 | 898 | 934 | ~895 | 922 | (3 | %) |
Agbaou Mine
Q4-2016 Insights:
2017 Outlook
Exploration Activities
Tabakoto Mine
Q4-2016 Insights:
2017 Outlook
Exploration Activities
Ity Mine
Q4-2016 Insights:
2017 Outlook
Exploration Activities
Nzema Mine
Q4-2016 Insights:
2017 Outlook
Exploration Activities
Karma Mine
Q4-2016 Insights:
2017 Outlook
Exploration Activities
> Houndé Project
Construction remains on-time and on-budget
Table 5: Remaining capital spend, in $m | ||
Upfront project capital | 328 | |
Capital spent in 2016 | (100 | ) |
Mining fleet equipment financing | (47 | ) |
Remaining capital spend | ~180 |
Achievements To-Date
Exploration Activities
> 2017 Outlook: Further Production Growth and AISC Reduction
Table 6: Production Guidance, koz
(on a 100% basis) | 2016 Actual | 2017 Guidance | ||
Agbaou | 195,505 | 175,000 | - | 180,000 |
Tabakoto | 162,817 | 150,000 | - | 160,000 |
Nzema | 87,710 | 100,000 | - | 110,000 |
Ity | 75,867 | 75,000 | - | 80,000 |
Karma | 61,817 | 100,000 | - | 110,000 |
Group-wide Production | 583,712 | 600,000 | - | 640,000 |
Table 7: AISC Guidance, US$/oz
(In US$/oz) | 2016 Actual | 2017 Guidance | ||
Agbaou | ~535 | 660 | - | 700 |
Tabakoto | ~1,030 | 950 | - | 990 |
Nzema | ~1,170 | 895 | - | 940 |
Ity | ~790 | 740 | - | 780 |
Karma | ~750 | 750 | - | 800 |
Mine-level AISC | ~870 | 800 | - | 850 |
Corporate G&A | ~46 | 37 | - | 34 |
Sustaining exploration | ~18 | 23 | - | 22 |
Group AISC | ~895 | 860 | - | 905 |
Table 8: Exploration Guidance, $m
(In $m) | 2017 Guidance |
Agbaou | 7 |
Tabakoto | 9 |
Ity | 10 |
Karma | 4 |
Houndé | 5 |
Exploration Expenditures for Mines | 35 |
Grassroots exploration expense | 5 |
Total Exploration Expenditures | 40 |
Table 9: Capital Expenditure Guidance, $m
(in US$m) | Sustaining Capital |
Non-Sustaining Capital |
Growth Projects |
Agbaou | 20 | - | - |
Tabakoto | 20 | - | - |
Nzema | 5 | 12 | - |
Ity | 10 | 4 | 10 |
Karma | 10 | 19 | 35 |
Houndé | - | - | 180 |
Total | 65 | 35 | 225 |
Table 10: 2017 Free Cash Flow Guidance based on Production and AISC Guidance Mid-points, in US$m
(in US$m) | $1,100/oz | $1,200/oz | $1,300/oz | |||
Net Revenue (based on production guidance mid-point) | 685 | 725 | 785 | |||
Mine level AISC costs (based on AISC guidance mid-point) | (510 | ) | (510 | ) | (510 | ) |
Corporate G&A | (21 | ) | (21 | ) | (21 | ) |
Sustaining exploration | (14 | ) | (14 | ) | (14 | ) |
Group AIS Margin | 140 | 180 | 240 | |||
Non-sustaining mine exploration | (20 | ) | (20 | ) | (20 | ) |
Non-sustaining capital | (35 | ) | (35 | ) | (35 | ) |
Free Cash Flow before growth projects (Mine cash flow less corporate costs before WC, tax and financing cost) |
85 | 125 | 185 |
> Sound Balance Sheet and Strong Financing & Liquidity Sources
Table 11: Net Debt Reduction, in US$m
(in US$ million) |
December 31, 2016 |
December 31, 2015 |
December 31, 2014 |
Cash | 125 | 110 | 62 |
Less: Equipment finance lease | 10 | 13 | 16 |
Less: Drawn portion of $350 million RCF | 140 | 240 | 300 |
Net Debt/(Cash) position | 25 | 144 | 254 |
> Conference call and live webcast
The 2016 Fourth Quarter and Year End Financials will be released before-market open on March 7, 2017. Management will host a conference call and live webcast on Tuesday, March 7, 2016, at 10:00 am Toronto time (EST), 3:00pm London time (GMT), 4:00pm Paris time (CET), to discuss the Company's financial results.
The live webcast can be accessed through the following link:
http://edge.media-server.com/m/p/ei9msxtz
Analysts and interested investors are also invited to participate and ask questions using the dial-in numbers below:
International: North American toll-free: UK toll-free: Australian toll-free: Confirmation code: |
+1646 254 3361 1877 280 2342 0800 279 4992 1800 027 830 8720003 |
Click here to add Webcast reminder to Outlook Calendar
Webcast Access for mobile devices - QR code:
Access the live and On-Demand version of the webcast from mobile devices running iOS and Android.
A replay of the conference call and webcast will be available on Endeavour's website.
Contact Information | Qualified Persons |
Martino De Ciccio VP - Strategy & Investor Relations +33 (0)1 70 38 36 95 [email protected] DFH Public Affairs in Toronto John Vincic, Senior Advisor (416) 206-0118 x.224 [email protected] Brunswick Group LLP in London Carole Cable, Partner +44 7974 982 458 [email protected] |
Adriaan "Attie" Roux, Pr.Sci.Nat, Endeavour's Chief Operating Officer, is a Qualified Person under NI 43-101, and has reviewed and approved the technical information related to mining operations in this news release. |
About Endeavour Mining Corporation
Endeavour Mining is a TSX-listed intermediate gold producer, focused on developing a portfolio of high quality mines in the prolific West-African region, where it has established a solid operational and construction track record.
Endeavour is ideally positioned as the major pure West-African multi-operation gold mining company, operating 5 mines in Côte d'Ivoire (Agbaou and Ity), Burkina Faso (Karma), Mali (Tabakoto), and Ghana (Nzema). In 2016, it expects to produce between 600koz and 640koz at an AISC of US$860 to US$905/oz. Endeavour is currently building its Houndé project in Burkina Faso, which is expected to commence production in Q4-2017 and to become its flagship low-cost mine with an average annual production of 190koz at an AISC of US$709/oz over an initial 10-year mine life based on reserves. The development of the Houndé project is expected to lift Endeavour's group production +900kozpa and decrease its average AISC to circa $800/oz by 2018, while exploration aims to extend all mine lives to +10 years.
Endeavour Mining | Executive Office | Bureau 76, 7 Boulevard des Moulins, Monaco 98000
This news release contains "forward-looking statements" including but not limited to, statements with respect to Endeavour's plans and operating performance, the estimation of mineral reserves and resources, the timing and amount of estimated future production, costs of future production, future capital expenditures, and the success of exploration activities. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as "expects", "expected", "budgeted", "forecasts" and "anticipates". Forward-looking statements, while based on management's best estimates and assumptions, are subject to risks and uncertainties that may cause actual results to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: risks related to the successful integration of acquisitions; risks related to international operations; risks related to general economic conditions and credit availability, actual results of current exploration activities, unanticipated reclamation expenses; changes in project parameters as plans continue to be refined; fluctuations in prices of metals including gold; fluctuations in foreign currency exchange rates, increases in market prices of mining consumables, possible variations in ore reserves, grade or recovery rates; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes, title disputes, claims and limitations on insurance coverage and other risks of the mining industry; delays in the completion of development or construction activities, changes in national and local government regulation of mining operations, tax rules and regulations, and political and economic developments in countries in which Endeavour operates. Although Endeavour 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. Please refer to Endeavour's most recent Annual Information Form filed under its profile at www.sedar.com for further information respecting the risks affecting Endeavour and its business. AISC, all-in sustaining costs at the mine level, cash costs, operating EBITDA, all-in sustaining margin, free cash flow, net free cash flow, free cash flow per share, net debt, and adjusted earnings are non-GAAP financial performance measures with no standard meaning under IFRS, further discussed in the section Non-GAAP Measures in the most recently filed Management Discussion and Analysis for the year ended December 31, 2015.
Appendix 1: Preliminary Production and Cost Details by Mine
On a quarterly basis
Agbaou | Nzema | Tabakoto | Ity | Karma | |||||||||||||||||||||||||||||
(on a 100% basis) | Unit | Q4-2016 | Q3-2016 | Q4-2015 | Q4-2016 | Q3-2016 | Q4-2015 | Q4-2016 | Q3-2016 | Q4-2015 | Q4-2016 | Q3-2016 | Q4-2015 | Q4-2016 | |||||||||||||||||||
Total tonnes mined - OP* | 000t | 6,518 | 6,877 | 4,924 | 2,885 | 2,848 | 1,341 | 1,593 | 1,569 | 2,423 | 1,472 | 948 | 375 | 4,022 | |||||||||||||||||||
Total ore tonnes - OP | 000t | 674 | 651 | 753 | 288 | 222 | 278 | 195 | 160 | 137 | 316 | 200 | 63 | 782 | |||||||||||||||||||
Open pit strip ratio* | W:t ore | 8.7 | 9.6 | 5.5 | 9.0 | 11.8 | 3.8 | 7.2 | 8.8 | 16.6 | 3.7 | 3.7 | 4.9 | 4.1 | |||||||||||||||||||
Total tonnes mined - UG | 000t | - | - | - | - | - | - | 324 | 302 | 358 | - | - | - | - | |||||||||||||||||||
Total ore tonnes - UG | 000t | - | - | - | - | - | - | 253 | 238 | 215 | - | - | - | - | |||||||||||||||||||
Total tonnes milled | 000t | 721 | 709 | 748 | 428 | 424 | 446 | 402 | 381 | 392 | 295 | 271 | 102 | 1,163 | |||||||||||||||||||
Average gold grade milled | g/t | 2.5 | 2.2 | 2.1 | 2.2 | 2.4 | 1.8 | 3.9 | 3.1 | 3.5 | 2.0 | 1.9 | 2.4 | 1.1 | |||||||||||||||||||
Recovery rate | % | 97 | % | 96 | % | 97 | % | 82 | % | 82 | % | 87 | % | 95 | % | 95 | % | 95 | % | 90 | % | 91 | % | 81 | % | 90 | % | ||||||
Gold ounces produced | oz | 57,061 | 49,384 | 51,372 | 23,874 | 24,279 | 23,076 | 47,884 | 37,019 | 41,546 | 17,480 | 15,334 | 5,689 | 28,848 | |||||||||||||||||||
Gold sold | oz | 56,936 | 51,308 | 53,298 | 22,033 | 23,526 | 22,526 | 47,053 | 37,324 | 41,118 | 15,038 | 15,349 | 7,917 | 28,743 | |||||||||||||||||||
Preliminary mine-level AISC per ounce sold | $/oz | ~535 | 550 | 537 | ~1,120 | 1,136 | 1,133 | ~930 | 1,071 | 1,119 | ~850 | 724 | 683 | ~750 |
For the year ended December 31
Agbaou | Nzema | Tabakoto | Ity | Karma | ||||||||||||||||||||
(on a 100% basis) | Unit | FY-2016 | FY-2015 | FY-2016 | FY-2015 | FY-2016 | FY-2015 | FY-2016 | FY-2015 | FY-2016 | ||||||||||||||
Total tonnes mined - OP* | 000t | 25,382 | 20,447 | 9,295 | 8,144 | 7,098 | 9,333 | 6,102 | 375 | 8,753 | ||||||||||||||
Total ore tonnes - OP | 000t | 2,797 | 2,818 | 1,000 | 1,310 | 649 | 520 | 1,186 | 63 | 1,879 | ||||||||||||||
Open pit strip ratio* | W:t ore | 8.1 | 6.3 | 8.3 | 5.2 | 10.4 | 17.2 | 4.2 | 4.9 | 3.7 | ||||||||||||||
Total tonnes mined - UG | 000t | - | - | - | - | 1,301 | 1,360 | - | - | - | ||||||||||||||
Total ore tonnes - UG | 000t | - | - | - | - | 944 | 860 | - | - | - | ||||||||||||||
Total tonnes milled | 000t | 2,827 | 2,665 | 1,761 | 1,783 | 1,588 | 1,588 | 1,173 | 102 | 2,089 | ||||||||||||||
Average gold grade milled | g/t | 2.3 | 2.2 | 1.9 | 2.2 | 3.4 | 3.2 | 2.2 | 2.4 | 1.2 | ||||||||||||||
Recovery rate | % | 97 | % | 97 | % | 83 | % | 87 | % | 95 | % | 93 | % | 93 | % | 81 | % | 90 | % | |||||
Gold ounces produced | oz | 195,505 | 181,365 | 87,710 | 110,302 | 162,817 | 151,067 | 75,867 | 5,689 | 61,813 | ||||||||||||||
Gold sold | oz | 196,316 | 182,219 | 85,495 | 110,404 | 161,803 | 151,345 | 73,332 | 7,917 | 62,884 | ||||||||||||||
Preliminary mine-level AISC per ounce sold |
$/oz | ~535 | 576 | ~1,170 | 1,064 | ~1,030 | 1,067 | ~790 | 683 | ~750 |
*Includes waste capitalized
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