Friday, May 07, 2021 4:13:44 PM
2:00 pm ET May 7, 2021 (Globe Newswire) Print
McEwen Mining Inc. NYSE: MUX (TSX: MUX) today reported its first quarter (Q1) results for the period ended March 31, 2021.
Operations Update
San Jose Mine, Argentina (49% Interest)
Our attributable production from San Jose in Q1 was 9,500 gold ounces and 492,300 silver ounces, for a total of 16,700 GEOs. For Q1, total cash costs and all-in sustaining costs (AISC) were $1,088 and $1,328 per GEO, respectively. This compares to 14,900 GEOs at total cash costs and AISC of $1,138 and $1,592 per GEO, respectively, in Q1 2020.
We received $5 million in dividends in Q1, compared to no dividends during the same period in 2020.
In 2021, the exploration budget is $10 million. Recent exploration results generated by our partner and mine operator have been encouraging, including an outstanding result from the Escondida vein:
62.5 g/t gold and 5,571 g/t silver over 2.0 meters - hole SJM-529
Gold Bar Mine, USA (100% Interest)
Gold Bar produced 7,400 GEOs in Q1 at total cash costs and AISC of $1,865 and $1,934 per GEO, respectively. This compares to 9,100 GEOs at total cash costs and AISC of $1,887 and $2,177 per GEO, respectively, in Q1 2020. Production for the remainder of the year is expected to increase, and correspondingly costs are expected to decrease. Updated resource and reserve estimates were completed. The exploration budget for 2021 is $5 million and is focusing on testing near-mine targets and further defining oxide resources on the neighboring Tonkin property.
Near-mine exploration during Q1 has delivered encouraging results from the North Ridge target, which will be provided in an upcoming exploration update.
Fox Complex, Canada (100% Interest)
Black Fox produced 5,200 GEOs in Q1 at total cash costs and AISC of $1,262 and $1,560 per GEO, respectively. This compares to 8,300 GEOs at total cash costs and AISC of $838 and $1,339 per GEO, respectively, in Q1 2020. Mining at Black Fox has begun transitioning to the Froome deposit, where a progressive ramp-up is planned through Q3, with commercial production expected in Q4. Costs are expected to fall considerably towards the latter half of the year as production rates increase to reach commercial production in Q4.
At the Stock property, surface exploration is underway with four drills at the Stock West target, and one drill at the historic Stock Mine. We spent $3.4 million in Q1 of the total $9 million exploration budget for 2021.
A Preliminary Economic Assessment (PEA) to expand the production from the Fox Complex will be released late in Q2. We are targeting improved production and cost profiles at the Fox Complex leveraging the potential for operational synergies through shared resources and infrastructure, a longer life of mine, and expanded production scale for the combined projects.
El Gallo Project, Mexico (100% Interest)
In Q1, El Gallo produced 1,300 GEOs from residual leaching of the heap leach pad. Operations were disrupted for three weeks by a blockade of the mine entrance by members of the local community, which has been resolved. A new 10-year agreement was reached between the El Gallo operation and the neighboring communities.
Los Azules Copper Project, Argentina (100% Interest)
Work continued on engineering and developing cost estimates to advance the proposed low altitude all-year access route to the project. Work is also progressing on identifying opportunities to accelerate the development and improve the economics of Los Azules. Concurrently, two strategic alternatives are being aggressively evaluated to determine what we believe will be the optimal way to finance the rapid development of Los Azules to create the greatest long-term value from this large copper resource for Argentina, the nearby communities, our shareholders, and employees.
Table 1 below provides production and cost results for Q1 2021 and 2020.
Q1
2021 2020
Consolidated Production
Gold (oz) 23,300 29,200
Silver (oz) 493,200 553,200
GEOs 30,600 35,100
San Jose Mine, Argentina (49%)
Gold production (oz) 9,500 9,000
Silver production (oz) 492,300 551,900
GEOs 16,700 14,900
Cash Costs ($/GEO) 1,088 1,138
AISC ($/GEO) 1,328 1,592
Gold Bar Mine, Nevada
GEOs 7,400 9,100
Cash Costs ($/GEO) 1,865 1,887
AISC ($/GEO) 1,934 2,177
Black Fox Mine, Canada
GEOs 5,200 8,300
Cash Costs ($/GEO) 1,262 838
AISC ($/GEO) 1,560 1,339
El Gallo Mine, Mexico
GEOs 1,300 2,700
Cash Costs ($/GEO)
AISC ($/GEO)
Notes:
-- Cash gross profit, cash costs per ounce, all-in sustaining costs (AISC) per ounce, and liquid assets are non-GAAP financial performance measures with no standardized definition under U.S. GAAP. For a description of the non-GAAP measures see "Non-GAAP Financial Measures" section in this press release; for the reconciliation of the non-GAAP measures to the closest U.S. GAAP measures, see the Management Discussion and Analysis for the year ended December 31, 2020 filed on Edgar and SEDAR.
-- Both cash costs and AISC per GEO no longer represent key metrics used by management to evaluate residual leaching at the El Gallo Project. For this reason, the Company has ceased relying on, and disclosing, cash costs and all-in-sustaining costs per ounce as a key metric.
For the SEC Form 10-Q Financial Statements and MD&A refer to: http://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000314203
Conference Call and Webcast
Management will discuss our Q1 2021 financial results and project developments and follow with a question-and-answer session. Questions can be asked directly by participants over the phone during the webcast.
To call into the conference call over the phone, please regis ter here:
Monday, May 10, 2021 http://www.directeventreg.com/registration/event/2562066
at 11:00 am EDT Audience URL:
https://event.on24.com/wcc/r/3082266/913742C4F6945BAA9039EE61980F124A
The webcast will be archived on McEwen Mining's website at https://www.mcewenmining.com/media following the call.
COVID-19
All our operations have implemented rigorous health and safety measures to prevent the spread of the COVID-19 virus. Currently, the COVID-19 pandemic is not materially affecting our operations, or our future plans and objectives.
Reliability of Information Regarding San Jose
Minera Santa Cruz S.A., the owner of the San Jose Mine, is responsible for and has supplied to the Company all reported results from the San Jose Mine. McEwen Mining's joint venture partner, a subsidiary of Hochschild Mining plc, and its affiliates other than MSC do not accept responsibility for the use of project data or the adequacy or accuracy of this release.
Technical Information
The technical contents of this news release have been reviewed and approved by G. Peter Mah, P.Eng., COO of McEwen Mining and a Qualified Person as defined by Canadian Securities Administrators National Instrument 43-101 "Standards of Disclosure for Mineral Projects."
CAUTIONARY NOTE REGARDING NON-GAAP MEASURES
In this release, we have provided information prepared or calculated according to United States Generally Accepted Accounting Principles ("U.S. GAAP"), as well as provided some non-U.S. GAAP ("non-GAAP") performance measures. Because the non-GAAP performance measures do not have any standardized meaning prescribed by U.S. GAAP, they may not be comparable to similar measures presented by other companies.
Cash Costs and All-in Sustaining Costs
Cash costs consist of mining, processing, on-site general and administrative costs, community and permitting costs related to current operations, royalty costs, refining and treatment charges (for both dore and concentrate products), sales costs, export taxes and operational stripping costs, and exclude depreciation and amortization. All-in sustaining costs consist of cash costs (as described above), plus accretion of retirement obligations and amortization of the asset retirement costs related to operating sites, sustaining exploration and development costs, sustaining capital expenditures, and sustaining lease payments. Both cash costs and all-in sustaining costs are divided by the gold equivalent ounces sold to determine cash costs and all-in sustaining costs on a per ounce basis. We use and report these measures to provide additional information regarding operational efficiencies on an individual mine basis, and believe that these measures provide investors and analysts with useful information about our underlying costs of operations. A reconciliation to production costs applicable to sales, the nearest U.S. GAAP measure is provided in McEwen Mining's Quarterly Report on Form 10-Q for the quarter ended March 31, 2021.
Cash Gross Profit
Cash gross profit is a non-GAAP financial measure and does not have any standardized meaning under GAAP. We use cash gross profit to evaluate our operating performance and ability to generate cash flow; we disclose cash gross profit as we believe this measure provides valuable assistance to investors and analysts in evaluating our ability to finance our ongoing business and capital activities. The most directly comparable measure prepared in accordance with GAAP is gross profit or loss. Cash gross profit is calculated by adding back the depreciation and depletion expense to gross profit or loss. A reconciliation to gross profit, the nearest U.S. GAAP measure is provided in McEwen Mining's Quarterly Report on Form 10-Q for the quarter ended March 31, 2021.
Liquid assets
The term liquid assets used in this report is a non-GAAP financial measure. We report this measure to better understand our liquidity in each reporting period. Liquid assets is calculated as the sum of the Balance Sheet line items of cash and cash equivalents, restricted cash and investments, plus ounces of dore held in precious metals inventories valued at the London PM Fix spot price at the corresponding period. A reconciliation to the nearest U.S. GAAP measure is provided in McEwen Mining's Quarterly Report on Form 10-Q for the quarter ended March 31, 2021.
CAUTION CONCERNING FORWARD-LOOKING STATEMENTS
This news release contains certain forward-looking statements and information, including "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements and information expressed, as at the date of this news release, McEwen Mining Inc.'s (the "Company") estimates, forecasts, projections, expectations or beliefs as to future events and results. Forward-looking statements and information are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties, risks and contingencies, and there can be no assurance that such statements and information will prove to be accurate. Therefore, actual results and future events could differ materially from those anticipated in such statements and information. Risks and uncertainties that could cause results or future events to differ materially from current expectations expressed or implied by the forward-looking statements and information include, but are not limited to, effects of the COVID-19 pandemic, fluctuations in the market price of precious metals, mining industry risks, political, economic, social and security risks associated with foreign operations, the ability of the corporation to receive or receive in a timely manner permits or other approvals required in connection with operations, risks associated with the construction of mining operations and commencement of production and the projected costs thereof, risks related to litigation, the state of the capital markets, environmental risks and hazards, uncertainty as to calculation of mineral resources and reserves, and other risks. Readers should not place undue reliance on forward-looking statements or information included herein, which speak only as of the date hereof. The Company undertakes no obligation to reissue or update forward-looking statements or information as a result of new information or events after the date hereof except as may be required by law. See McEwen Mining's Annual Report on Form 10-K for the fiscal year ended December 31, 2020 and other filings with the Securities and Exchange Commission, under the caption "Risk Factors", for additional information on risks, uncertainties and other factors relating to the forward-looking statements and information regarding the Company. All forward-looking statements and information made in this news release are qualified by this cautionary statement.
The NYSE and TSX have not reviewed and do not accept responsibility for the adequacy or accuracy of the contents of this news release, which has been prepared by the management of McEwen Mining Inc.
ABOUT MCEWEN MINING
McEwen Mining is a diversified gold and silver producer and explorer focused in the Americas with operating mines in Nevada, Canada, Mexico and Argentina. It also owns a large copper deposit in Argentina.
Recent MUX News
- McEwen Mining: Grey Fox Exploration Update • GlobeNewswire Inc. • 09/11/2024 11:00:00 AM
- Form EFFECT - Notice of Effectiveness • Edgar (US Regulatory) • 09/06/2024 04:15:08 AM
- 100% Renewable Energy for Los Azules • GlobeNewswire Inc. • 08/26/2024 07:34:52 PM
- Recent and Upcoming McEwen Mining and McEwen Copper Presentations • GlobeNewswire Inc. • 08/22/2024 11:05:04 PM
- Form 425 - Prospectuses and communications, business combinations • Edgar (US Regulatory) • 08/19/2024 08:43:19 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 08/19/2024 08:34:53 PM
- McEwen Mining Announces Closing of Timberline Acquisition • GlobeNewswire Inc. • 08/19/2024 08:15:55 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 08/09/2024 08:12:14 PM
- McEwen Copper Update, Excitement in Argentina: Milei Magic Is Turbocharging Foreign Investments; US$4.4 Billion Copper Transaction by BHP and Lundin Mining; Los Azules Infill Drilling Confirmed High Grade Copper Zone • GlobeNewswire Inc. • 08/08/2024 10:10:43 PM
- McEwen Mining: Q2 2024 Results • GlobeNewswire Inc. • 08/07/2024 10:54:31 PM
- McEwen Mining Q2 2024 Results Conference Call • GlobeNewswire Inc. • 08/06/2024 01:47:25 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 07/18/2024 12:57:42 PM
- Form 424B3 - Prospectus [Rule 424(b)(3)] • Edgar (US Regulatory) • 07/15/2024 10:02:21 AM
- McEwen Mining Announces AGM Voting Results, Meeting Resources Now Available • GlobeNewswire Inc. • 07/02/2024 09:28:40 PM
- McEwen Copper Announces $70 Million Financing to Advance the Los Azules Copper Project • GlobeNewswire Inc. • 06/24/2024 09:36:01 PM
- Fox Complex: Extending Mine Life; A New Mine at the Stock Property; Exploration Has Driven the Prospect of Earlier Cash Flow • GlobeNewswire Inc. • 06/20/2024 08:00:00 PM
- McEwen Mining Announces Closing of Flow-Through Financing • GlobeNewswire Inc. • 06/14/2024 12:47:32 PM
- IBN Announces Latest Episode of The MiningNewsWire Podcast featuring Rob McEwen, Chairman and Chief Owner of McEwen Mining Inc. • GlobeNewswire Inc. • 06/13/2024 12:00:00 PM
- McEwen Mining Announces Flow-Through Financing at $14.36 (Cdn$19.59) per Share a 19% Premium to Market • GlobeNewswire Inc. • 05/29/2024 02:52:49 AM
- McEwen Mining: Grey Fox Exploration Update Extending the Production Pipeline: Good Grades Near Surface, Potential at Depth • GlobeNewswire Inc. • 05/27/2024 11:00:00 AM
- Form S-4 - Registration of securities, business combinations • Edgar (US Regulatory) • 05/22/2024 09:23:55 PM
- McEwen Copper Announces Completion of the Feasibility Drilling Program • GlobeNewswire Inc. • 05/16/2024 05:30:40 PM
- McEwen Mining: Q1 2024 Results • GlobeNewswire Inc. • 05/08/2024 08:25:33 PM
- McEwen Mining Q1 2024 Results Conference Call • GlobeNewswire Inc. • 05/06/2024 03:14:03 PM
VHAI - Vocodia Partners with Leading Political Super PACs to Revolutionize Fundraising Efforts • VHAI • Sep 19, 2024 11:48 AM
Dear Cashmere Group Holding Co. AKA Swifty Global Signs Binding Letter of Intent to be Acquired by Signing Day Sports • DRCR • Sep 19, 2024 10:26 AM
HealthLynked Launches Virtual Urgent Care Through Partnership with Lyric Health. • HLYK • Sep 19, 2024 8:00 AM
Element79 Gold Corp. Appoints Kevin Arias as Advisor to the Board of Directors, Strengthening Strategic Leadership • ELMGF • Sep 18, 2024 10:29 AM
Mawson Finland Limited Further Expands the Known Mineralized Zones at Rajapalot: Palokas step-out drills 7 metres @ 9.1 g/t gold & 706 ppm cobalt • MFL • Sep 17, 2024 9:02 AM
PickleJar Announces Integration With OptCulture to Deliver Holistic Fan Experiences at Venue Point of Sale • PKLE • Sep 17, 2024 8:00 AM