Jaguar Mining Reports Second Quarter 2020 Financial Results
- Consolidated Gold Production Increased 28%
- Gross Profit increased 312%- Strong Treasury Position of $30.2M
- COC Decreased by 25% to $586/oz Au and AISC Decreased 35% to $882/oz Au
TORONTO, ON / ACCESSWIRE, Aug 10, 2020 - (ACN Newswire) - Jaguar Mining Inc. ("Jaguar" or the "Company") (TSX:JAG) announced recently the financial and operating results for the three months ("Q2 2020") and six months ended June 30, 2020. All figures are in US Dollars, unless otherwise expressed.
Q2 2020 Operating Summary
- Consolidated gold production increased 43% with 23,483 ounces produced (208,000 tonnes milled, average grade of 4.00 g/t) in Q2 2020 compared to 16,365 ounces produced in Q1 2019 and 28% compared to 18,366 ounces produced in Q2 2019.
- Pilar mine gold production increased 17% with 13,452 ounces produced compared to 11,521 ounces produced in Q1 2020 and increased 28% compared to 10,543 ounces produced in Q2 2019.
- Turmalina mine gold production of increased 6% with 10,031 ounces produced compared to 9,487 ounces produced in Q1 2020 and increased 28% compared to 7,823 ounces produced in Q2 2019.
- Primary development increased 30% to 1,707 meters compared to 1,310 meters completed in Q2 2019.
- Sustaining capital expenditures of $6.1 million invested in mining equipment and development.
Q2 2020 Financial Results Summary
- Gross profit increased 312% to $23.9 million compared to $5.8 million in Q2 2019.
-- Increased profitability in Q2 2020 reflects higher operating production quarter-over-quarter, and also an increase in the average realized gold price of $1,703/oz in Q2 2020 compared to $1,286/oz for Q2 2019.
- Consolidated Cash operating costs ("COC") decreased 25% to $586 per ounce of gold sold for Q2 2020, compared to $786 during Q2 2019.
- Consolidated all-in sustaining costs ("AISC") decreased 35% to $882 per ounce of gold sold in Q2 2020, compared to $1,366 during Q2 2019.
-- Decrease in costs is mainly due to increase in production, higher head-grade and devaluation of the BRL currency.
- Operating cash flow of $27.5 million; adjusted EBITDA of $27.2 million.
- Net income of $19.2 million, or net income per share of $0.03.
- Free cash flow was $21.4 million for Q2 2020 based on operating cash flow, less sustaining capital, compared to negative $0.9 million in Q2 2019. The free cash flow for the quarter includes approximately $3.2M of sales proceeds from Q1 2020 which was received in Q2 2020.
-- Free cash flow was $858 per ounce sold in Q2 2020 compared to negative $47 per ounce sold in Q2 2019.
- Strong treasury as of June 30, 2020, with cash of $30.2 million compared to cash of $12.1 million on March 31, 2020, demonstrating significant generation of pre-tax free cash flow.
Vern Baker, President and CEO of Jaguar Mining stated: "These strong second quarter results reflect our steady progression to reach our sustainable goal of 25,000 ounces per quarter. The financials reflect both improving production performance and strong tailwinds in the form of a weaker Brazilian Real and improving prices for gold. We are pleased to report that this is now our fifth quarter in a row with increasing ounce production. All the members of our Brazilian team of miners have demonstrated a commitment to moving our company through this current COVID-19 crisis and building a sustainable organization.
COVID-19 remains our key risk in terms of maintaining momentum. Cases in Brazil have been on the increase and our team has now reported its first few cases with our people. However, the team has remained calm and focused, and people who have confirmed positive with the virus, have now returned to work after appropriate quarantining. All our people are working to manage our way through the COVID-19 issue, and we have developed plans to deal with various potential scenarios as the situation continues to unfold.
Vern added, "We are pleased to report that Pilar Gold Mine reached a new production record for the quarter with 13,452 ounces produced. Turmalina Gold Mine production continues to improve, and this quarter reported a 6% increase from the prior quarter with 10,031 ounces produced, and development rates at Turmalina are sufficient to augment production in the second half of the year.
Jaguar enters the second half of the year with a very strong balance sheet, a sustainable production platform, excellent exploration opportunities, an impressive position in the Iron Quadrangle; both in hectares and in available infrastructure, and an outstanding cash flow position. With this strong performance, our supportive board have approved additional expenditures in 2020 for exploration and project evaluation."
Q2 2020 Financial Results
Table 1: https://pr.report/j4AyQ9v2
Table 2: https://pr.report/OSPNrpw7
Cash Position and Use of Funds
- Strong treasury as of June 30, 2020, with cash of $30.2 million compared to cash of $12.1 million on March 31, 2020. Brazilian Bank debt of $1 million was also paid down and $0.7 million of common shares were bought back through the Normal Course Issuer Bid program.
- As at June 30, 2020, working capital was $25.8 million, compared to $9.4 million as at December 31, 2019, which includes $3.5 million in loans from Brazilian banks, which mature every six months and are expected to be rolled forward.
Scientific and technical information contained in this press release has been reviewed and approved by Jonathan Victor Hill, BSc (Hons) (Economic Geology - UCT), Senior Expert Advisor Geology and Exploration to the Jaguar Mining Management Committee, who is also an employee of Jaguar Mining Inc., and is a "qualified person" as defined by National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101").
The Iron Quadrangle
The Iron Quadrangle has been an area of mineral exploration dating back to the 16th century. The discovery in 1699-1701 of gold contaminated with iron and platinum-group metals in the southeastern corner of the Iron Quadrangle gave rise to the name of the town Ouro Preto (Black Gold). The Iron Quadrangle contains world-class multi-million-ounce gold deposits such as Morro Velho, Cuiaba, and Sao Bento. Jaguar holds the second largest gold land position in the Iron Quadrangle with just over 25,000 hectares.
About Jaguar Mining Inc.
Jaguar Mining Inc. is a Canadian-listed junior gold mining, development, and exploration company operating in Brazil with three gold mining complexes and a large land package with significant upside exploration potential from mineral claims covering an area of approximately 64,000 hectares. The Company's principal operating assets are located in the Iron Quadrangle, a prolific greenstone belt in the state of Minas Gerais and include the Turmalina Gold Mine Complex and Caete Mining Complex (Pilar and Roca Grande Mines, and Caete Plant). The Company also owns the Paciencia Gold Mine Complex, which has been on care and maintenance since 2012. The Roca Grande Mine has been on temporary care and maintenance since April 2019. Additional information is available on the Company's website at www.jaguarmining.com.