Golden Minerals Company ("Golden Minerals", "Golden" or the "Company") (NYSE:AUMN, TSX:AUMN) today provided financial results and a business summary for the quarter ending September 30, 2021.
Third Quarter Summary Financial Results - Highlights
(All currency expressed in approximate USD)
- Revenue of $8.5 million yielding a net operating margin of $4.2 million in the third quarter 2021, from mining operations at the Company's Rodeo gold-silver mine in Mexico. In the third quarter 2020, the Company recorded revenue of $2.1 million and a net operating margin of $1.6 million from the lease of the Company's oxide mill.
- $8.8 million cash and cash equivalents balance as of September 30, 2021, compared to $6.9 million at June 30, 2021.
- Net income of $0.4 million in the third quarter 2021, compared to a net loss of $1.3 million in the third quarter 2020.
Third Quarter Business Summary
- Produced 4,777 payable gold ounces and 12,196 payable silver ounces (4,942 gold equivalent ("AuEq") ounces) with total cash costs, net of silver by-product credits, per payable ounce of gold of $865.1
- Sold 4,804 AuEq oz. in doré, with 1,042 AuEq oz. in doré inventory at the end of the quarter.
- Reported grades processed of 4.0 grams per tonne ("g/t") gold and 9 g/t silver during the quarter.
- Processed at an average rate of 532 tonnes per day ("tpd") during the quarter.
- Reported several potentially resource-grade intercepts from exploration drilling at Rodeo. The program, which has the potential to expand the life of the Rodeo mine beyond the currently estimated life of around 2 ¼ years, concluded in October. Full results are expected before year end.
- Continued limited scale test mining activities at Velardeña for further study of selective mining methods and to produce crushed run of mine material and sulfide concentrates for additional flotation separation studies and final optimization of a bio-oxidation plant design. Results of these studies are expected in Q1 2022, after which time the Company anticipates making a development decision.
1 Gold equivalents based on actual gold and silver prices realized during the third quarter 2021.
Warren Rehn, President and Chief Executive Officer of Golden Minerals, commented, "We are pleased to report our first-ever profitable quarter from mining operations based on continuing strong results from gold-silver production at Rodeo. We lowered our cash operating costs to $865 per payable gold ounce in the quarter. Looking forward, we remain on course to achieve the higher end of our 2021 production guidance of 12,000 - 14,000 oz gold and have already exceeded our guidance of 25,000 - 30,000 oz silver."
Quarterly Conference Call and Webcast
Management will be holding a conference call and webcast on Tuesday, November 9, 2021 at 11:00 a.m. Eastern Time to discuss third quarter 2021 financial results and recent project updates. You are invited to join the webcast at Golden Minerals Q3 2021 Earnings Call and Webcast. Please plan to join 10 minutes prior to the start time.
The webcast will also be available on the Golden Minerals website at http://www.goldenminerals.com after November 9, 2021.
Third Quarter 2021 Financial Results
The Company reported revenue of $8.5 million from doré sales, $4.3 million costs of metals sold and $4.2 million in net operating margin in the third quarter 2021, all related to gold-silver production at the Rodeo mine. Exploration expenditures were $2.1 million during the quarter and included continued drilling at Rodeo targeting resource expansion, commencement of an initial drill program at the Sarita Este gold-copper project in Salta Province, Argentina, and other general exploration and holding costs related to the Company's portfolio of exploration projects. Velardeña care and maintenance expenses were $0.4 million in the quarter and include costs related to test mining in advance of a production decision. El Quevar project expense was $0.1 million and includes costs of exploration and evaluation activities, care and maintenance, and property holding costs, net of reimbursements from Barrick Gold under the terms of an Earn-In Agreement. Administrative expenses totaled $0.9 million and include costs associated with being a public company that are incurred primarily by the Company's corporate activities in support of the Rodeo Property, the Velardeña Properties, the Yoquivo project and the balance of the Company's exploration portfolio. Net income was $0.4 million or $0.00 per share.
Twelve Month Financial Outlook
The Company ended the third quarter 2021 with a cash balance of $8.8 million and anticipates receiving approximately $11.0 to $12.0 million in net operating margin (defined as revenue from the sale of metals less costs of metals sold) from the Rodeo operation during the 12 months ending September 30, 2022, assuming average gold and silver prices during that period of $1,800 and $25.00 oz, respectively. The Company also anticipates receiving the second installment of $1.5 million due to Golden Minerals from Fabled Silver Gold Corp. in December 2021 under the terms of an agreement for the sale of the Company's Santa Maria project.
The Company's currently forecasted expenditures during the 12 months ending September 30, 2022, apart from Rodeo costs of metals sold which are included in the net operating margin forecast, total approximately $10.0 million as follows:
- $4.9 million on exploration activities and property holding costs associated with the Company's portfolio of exploration properties located in Mexico, Argentina and Nevada, including project assessment and evaluation costs relating to additional exploration at Rodeo, Yoquivo and other properties;
- $0.8 million at the Velardeña Properties for care and maintenance;
- $0.6 million at the El Quevar project to fund care and maintenance and property holding costs, net of reimbursement from Barrick; and
- $3.7 million in general and administrative costs.
Additional information regarding third quarter 2021 financial results can be found in the Company's 10-Q Quarterly Report which is available on the Golden Minerals website at www.goldenminerals.com.
About Golden Minerals
Golden Minerals is a growing gold and silver producer based in Golden, Colorado. The Company is primarily focused on producing gold and silver from its Rodeo Mine and advancing its Velardeña Properties in Mexico and, through partner funded exploration, its El Quevar silver property in Argentina, as well as acquiring and advancing selected mining properties in Mexico, Nevada and Argentina.
Financial Statements
CONDENSED CONSOLIDATED BALANCE SHEETS (US Dollars, unaudited) |
||||||
| September 30, | December 31, | |||||
2021 |
|
2020 |
|
|||
| (in thousands, except share data) | ||||||
| Assets | ||||||
| Current assets | ||||||
| Cash and cash equivalents | $ | 8,800 |
|
$ | 9,704 |
|
| Short-term investments | 102 |
|
79 |
|
||
| Lease receivables | — |
|
72 |
|
||
| Inventories, net | 1,857 |
|
284 |
|
||
| Value added tax receivable, net | 1,103 |
|
45 |
|
||
| Prepaid expenses and other assets | 859 |
|
1,130 |
|
||
| Total current assets | 12,721 |
|
11,314 |
|
||
| Property, plant and equipment, net | 6,521 |
|
5,520 |
|
||
| Other long term assets | 820 |
|
1,472 |
|
||
| Total assets | $ | 20,062 |
|
$ | 18,306 |
|
| Liabilities and Equity | ||||||
| Current liabilities | ||||||
| Accounts payable and other accrued liabilities | $ | 3,346 |
|
$ | 1,318 |
|
| Deferred revenue, current | 116 |
|
535 |
|
||
| Other current liabilities | 325 |
|
667 |
|
||
| Total current liabilities | 3,787 |
|
2,520 |
|
||
| Asset retirement and reclamation liabilities | 3,274 |
|
3,166 |
|
||
| Other long term liabilities | 400 |
|
648 |
|
||
| Total liabilities | 7,461 |
|
6,334 |
|
||
| Commitments and contingencies | ||||||
| Equity | ||||||
| Common stock, $.01 par value, 350,000,000 shares authorized; 162,804,612 and 157,512,652 shares issued and outstanding respectively | 1,628 |
|
1,575 |
|
||
| Additional paid in capital | 540,416 |
|
536,263 |
|
||
| Accumulated deficit | (529,443 |
) |
(525,866 |
) |
||
| Shareholders' equity | 12,601 |
|
11,972 |
|
||
| Total liabilities and equity | $ | 20,062 |
|
$ | 18,306 |
|
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (US dollars, unaudited) |
|||||||||||||||
|
|
|
|
||||||||||||
|
Three Months Ended |
|
Nine Months Ended |
||||||||||||
|
September 30, |
|
September 30, |
||||||||||||
|
2021 |
|
|
2020 |
|
|
2021 |
|
|
2020 |
|
||||
| (in thousands except per share data) | (in thousands, except per share data) | ||||||||||||||
| Revenue: | |||||||||||||||
| Sale of metals | $ | 8,479 |
|
$ | — |
|
$ | 16,118 |
|
$ | — |
|
|||
| Oxide plant lease | — |
|
2,146 |
|
— |
|
4,566 |
|
|||||||
| Total revenue | 8,479 |
|
2,146 |
|
16,118 |
|
4,566 |
|
|||||||
| Costs and expenses: | |||||||||||||||
| Cost of metals sold (exclusive of depreciation shown below) | (4,292 |
) |
— |
|
(9,156 |
) |
— |
|
|||||||
| Oxide plant lease costs | — |
|
(582 |
) |
— |
|
(1,566 |
) |
|||||||
| Exploration expense | (2,146 |
) |
(1,226 |
) |
(4,021 |
) |
(3,681 |
) |
|||||||
| El Quevar project expense | (90 |
) |
(130 |
) |
(249 |
) |
(623 |
) |
|||||||
| Velardeña care and maintenance costs | (414 |
) |
(206 |
) |
(754 |
) |
(861 |
) |
|||||||
| Administrative expense | (911 |
) |
(852 |
) |
(3,451 |
) |
(2,782 |
) |
|||||||
| Stock based compensation | (75 |
) |
(105 |
) |
(1,491 |
) |
(771 |
) |
|||||||
| Reclamation expense | (67 |
) |
(63 |
) |
(196 |
) |
(184 |
) |
|||||||
| Other operating income (expense), net | 138 |
|
24 |
|
472 |
|
(78 |
) |
|||||||
| Depreciation and amortization | (143 |
) |
(226 |
) |
(466 |
) |
(770 |
) |
|||||||
| Total costs and expenses | (8,000 |
) |
(3,366 |
) |
(19,312 |
) |
(11,316 |
) |
|||||||
| Income (loss) from operations | 479 |
|
(1,220 |
) |
(3,194 |
) |
(6,750 |
) |
|||||||
| Other income (expense): | |||||||||||||||
| Interest and other expense, net | (13 |
) |
(12 |
) |
(336 |
) |
(85 |
) |
|||||||
| Gain (loss) on foreign currency transactions | 133 |
|
(36 |
) |
156 |
|
(92 |
) |
|||||||
| Total other income (loss) | 120 |
|
(48 |
) |
(180 |
) |
(177 |
) |
|||||||
| Gain (loss) from operations before income taxes | 599 |
|
(1,268 |
) |
(3,374 |
) |
(6,927 |
) |
|||||||
| Income taxes | (188 |
) |
(18 |
) |
(203 |
) |
(18 |
) |
|||||||
| Net Income (loss) | $ | 411 |
|
$ | (1,286 |
) |
$ | (3,577 |
) |
$ | (6,945 |
) |
|||
| Net income (loss) per common share — basic | |||||||||||||||
| Income (loss) | $ | - |
|
$ | (0.01 |
) |
$ | (0.02 |
) |
$ | (0.06 |
) |
|||
| Net income (loss) per common share — diluted | |||||||||||||||
| Income (loss) | $ | - |
|
$ | (0.01 |
) |
$ | (0.02 |
) |
$ | (0.06 |
) |
|||
| Weighted average Common Stock outstanding - basic | 162,477,039 |
|
143,285,564 |
|
161,751,452 |
|
124,956,140 |
|
|||||||
| Weighted average Common Stock outstanding - diluted | 174,549,498 |
|
143,285,564 |
|
161,751,452 |
|
124,956,140 |
|
|||||||
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended, and applicable Canadian securities legislation, including statements regarding expectations pertaining to the Rodeo drilling program, including the timing of results and the potential to expand the life of the Rodeo mine beyond the currently estimated life; gold-silver production and operations at Rodeo; anticipated net operating margin from the Rodeo operation during the 12 months ending September 30, 2022; timing of results from the Velardeña test mining studies and subsequent development decisions; ;; the expected second installment due to Golden Minerals from Fabled Silver Gold Corp.; and forecasted expenditures during the 12 months ending September 30, 2022. These statements are subject to risks and uncertainties, including the overall impact of the COVID-19 pandemic, including the potential future re-suspension of non-essential activities in Mexico, including mining; lower than anticipated revenue or higher than anticipated costs at the Rodeo mine; declines in general economic conditions; changes in political conditions, in tax, royalty, environmental and other laws in the United States, Mexico or Argentina and other market conditions; and fluctuations in silver and gold prices. Golden Minerals assumes no obligation to update this information. Additional risks relating to Golden Minerals may be found in the periodic and current reports filed with the SEC by Golden Minerals, including the Company's Annual Report on Form 10-K for the year ended December 31, 2020.
For additional information please visit http://www.goldenminerals.com/.
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