Galantas Gold Corporation (TSX VENTURE:GAL) (AIM:GAL) (the Company) is pleased
to announce its interim results for the six months ended June 30th 2013 and
second quarter results for the three months ended 30 June 2013.
Financial Highlights
Highlights of the 2013 second quarter's and first six months results, which are
expressed in Canadian Dollars, are:
----------------------------------------------------------------------------
Second Quarter Ended June 30 Six Months Ended June 30
----------------------------------------------------------------------------
All figures
denominated in
Canadian
Dollars (CDN$) 2013 2012 2013 2012
----------------------------------------------------------------------------
Revenue $ 523,856 $ 1,902,980 $ 888,532 $ 2,928,126
----------------------------------------------------------------------------
Cost of Sales $ 511,833 $ 993,304 $ 909,421 $ 2,013,811
----------------------------------------------------------------------------
Income(loss)
before the
undernoted $ 12,023 $ 909,676 $ (20,889) $ 914,315
----------------------------------------------------------------------------
Amortization $ 122,224 $ 186,624 $ 246,830 $ 371,189
----------------------------------------------------------------------------
General
administrative
expenses $ 294,721 $ 413,004 $ 591,780 $ 866,960
----------------------------------------------------------------------------
(Gain) on sale
of plant and
equipment $ (64,531) $ (15,952) $ (64,531) $ (14,446)
----------------------------------------------------------------------------
Gain on debt
extinguishment $ 0 $ (190,624) $ 0 $ (190,624)
----------------------------------------------------------------------------
Foreign
exchange/(gain)
loss $ 17,272 $ (27,110) $ 3,249 $ (19,109)
----------------------------------------------------------------------------
Net (Loss)
Income for the
period $ (357,663) $ 543,734 $ (798,217) $ (99,655)
----------------------------------------------------------------------------
Working Capital
(Deficit) $ (3,037,837) $ (472,142) $ (3,037,837) $ (472,142)
----------------------------------------------------------------------------
Cash (loss)
generated from
operating
activities
before changes
in non-cash
working capital $ (323,010) $ 556,321 $ (562,917) $ 253,003
----------------------------------------------------------------------------
Cash at June 30,
2013 $ 476,581 $ 2,976,819 $ 476,581 $ 2,976,819
----------------------------------------------------------------------------
The Net Loss for the three months ended June 30, 2013, amounted to CDN$ 357,663
(2012 Q2: Net Income CDN$ 543,734) and the cash loss generated from operating
activities before changes in non-cash working capital in the second quarter of
2012 amounted to CDN$ 323,010 (2012 Q2:Cash gain CDN$ 556,321). The cash
generated from processing low grade material was positive on a strict
operational basis before the inclusion of administration costs and overheads in
the second quarter (Q2), following a reduction in costs.
Sales revenues for the six months ended June 30, 2013 amounted to CDN$ 888,532
(2012: CDN$ 2,928,126) with sales revenues for the three months ended June 30,
2013 amounted to CDN$ 523,856 (Q2 2012: CDN$ 1,902,980). This reduction in sales
revenues is due to the lower level of metal produced and shipped during both
periods primarily due to the requirement to process from stockpile ore at the
Omagh mine as a result of difficulties in accessing ore from the open pits.
Cost of sales for the six months ended June 30, 2013 amounted to CDN$ 909,421
(2012: CDN$ 2,013,811). Cost of sales for the three months ended June 30, 2013
amounted to CDN $ 511,833 (Q2 2012: CDN$ 993,304). There was a decrease in
various production costs at the Omagh mine during the second quarter, including
production wages reflecting the reduced number of personnel arising from the
rationalisation programme, Oil and Fuel costs, Repairs and servicing costs and
usage of Consumables which reductions were primarily attributable to the reduced
level of open pit mining during both periods when compared with 2012. General
administrative costs for the six months ended June 30, 2013 amounted to CDN$
591,780(2012: CDN$ 866,960). General administrative costs for the three months
ended June 30, 2013 amounted to CDN$ 294,721(2012: CDN$ 413,004).
The Net Loss for the six months ended June 30, 2013, amounted to CDN$ 798,217
(2012: Net Loss CDN$ 99,655). The cash loss generated from operating activities
before changes in non-cash working capital for the first half of 2013 amounted
to CDN$ (562,917) (2012: Cash gain $ 253,003).
The Company had cash balances at June 30, 2013 of CDN$ 476,581compared to CDN$
2,976,819 at June 30, 2012. The working capital deficit at June 30, 2013
amounted to CDN$ 3,037,837 which compared to a deficit of CDN$ 472,142 at
December 31, 2011.
Production
Production for comparative quarters is summarised below:
----------------------------------------------------------------------------
Three Months Three Months Six Months Six Months
to June 30 to June 30 to June 30 to June 30
2013 2012 2013 2012
----------------------------------------------------------------------------
Tonnes Milled 12,018 15,036 23,771 24,456
----------------------------------------------------------------------------
Average Grade g/t gold 1.34 2.36 1.3 2.65
----------------------------------------------------------------------------
Concentrate Dry Tonnes 145 355 290 623
----------------------------------------------------------------------------
Gold Grade (concentrate) 94.4 100 90.6 104
----------------------------------------------------------------------------
Gold Produced (oz) 441 1,152 838.7 2,084
----------------------------------------------------------------------------
Gold Produced (kg) 13.7 35.8 26.1 64.8
----------------------------------------------------------------------------
Silver Grade 208.7 294 160 282.0
----------------------------------------------------------------------------
Silver Produced (oz) 975 3,395 1,495 5,642
----------------------------------------------------------------------------
Silver Produced (kg) 30.3 105.5 46.5 174.5
----------------------------------------------------------------------------
Lead Produced tonnes 6.9 23.4 11 48.3
----------------------------------------------------------------------------
Gold Equivalent (oz) 467 1,245 880 2,251
----------------------------------------------------------------------------
Concentrate production at the Omagh mine during the three and six months ended
June 30, 2013 was significantly below production levels of the corresponding
periods of 2012 due primarily to the processing of lower grade ore.
The main production focus during the second quarter has been on the processing
of ore from the low grade stockpile. Earlier in the year there had been some
limited open pit mining on the Kerr vein which ceased later in the first quarter
when the pit met its planned design limit. From the second half of 2012 mining
from the Kearney pit had become totally restricted as a result of the surplus
rock stockpile on the site reaching capacity levels. This surplus rock was due
to be transported from the site in 2012 with the Omagh mine having completed
construction of public road improvements, at its own cost, to comply with the
conditions of the planning consent. However, following a judicial review brought
by a private individual on the grounds of procedural failings by Planning
Service, the planning consent was quashed with the surplus rock remaining on
site. This ongoing limitation will result in future production continuing to be
from the low grade stockpile. To generate cash from its operations going
forward, the Company is continuing to improve efficiencies and cut costs during
the second quarter.
During the three and six months ended June 30, 2013 the mill was fed with the
lower grade ore and production continued to be hampered by both the ongoing
variations in the metallurgy due to the inconsistent grade of ore being milled
and the clay content of stocked material. Production was also hampered by some
unplanned downtime in the plant.
The reinstatement of a third paste cell was completed during the first quarter.
Work, which had commenced in early 2012, on the development of a number of paste
cells already permitted, in preparation for their future utilisation when
underground mining at the Omagh mine commences was also progressed earlier in
2013 following the cessation of mining on the Kerr vein.
The 2013 production figures and metal contents are provisional and subject to
averaging or umpiring provisions under the concentrate off - take agreement
detailed in a press release dated October 3, 2007.
Exploration
The major focus of exploration activities in 2012 and the first half of 2013 has
been the continuation of the successful drilling program. In total, 16,879
metres have been drilled since the program commenced in March 2011 with
significant gold intersects being reported.
The drilling programme began in 2011 with the objective of extending the depth
and extent of the Joshua vein and providing data for a potential underground
operation based upon the Joshua and Kearney veins. During 2011 and 2012 ninety
five holes were drilled totalling 16,347 metres. Channel sampling was also
carried out, during this period, on the Joshua, Kearney and Kerr vein systems.
On Joshua, a total strike length of 213 metres was sampled. On Kerr, an increase
in average vein width and gold grade was identified within depth over a 30 metre
strike length.
The exploration programme had expanded considerably in 2012 with six drills
operational during the first half of the year. The second half of the year saw
the number of rigs progressively reduce with one rig, owned by the Company,
remaining in operation by the end of 2012. The two principal objectives of the
drilling programme were to complete the deeper holes on Kearney in order to gain
a more accurate picture of the zone of mineralization for the purpose of the
underground mine plan and to extend the strike of Joshua to the north and the
south, and begin to target deeper sections of the vein. Drilling continued in to
the first quarter of 2013 when two further holes targeting north Kearney and
central Joshua were completed and a further drill hole commenced in the second
quarter. Following the scale back of drilling in 2013, more time was dedicated
to logging remaining drill cores, the sealing off of all accessible drill holes,
updating databases and progressing towards a resource estimate using the
Micromine geological modelling computer program.
Assay results released to date from both the drilling and channel sampling
programme have been encouraging with significant gold intersections being
identified. The updated resource estimate (Technical Report July 2013) contains
all material data related to the program (with the exception of one hole
detailed in a disclosure dated 27th August 2013). Results to date have been
positive, in particular the assays from the ten drill holes on Joshua released
in January 2013 with thirteen significant mineral intersects. Once additional
funding becomes available this drilling programme will continue using the
company's own core drilling rig manned by in-house drillers. Up to a further
1,000 metres of drilling are planned, following up the recently reported gold
intersects on the Joshua vein. One hole has been completed in the program, with
a positive result (press release 27th August 2013).
During 2012 the Company ACA Howe International Ltd (Howe UK) completed an
Interim Resource Estimate to Canadian National Instrument NI 43-101 compliant
mineral resource estimate and a Preliminary Economic Assessment for the Omagh
Gold Project (see press release dated July 3, 2012) This report, which was based
on drilling results and analyses received to June 8, 2012, identified all
resources discovered at that date. The Company subsequently filed a complete
Technical Report on SEDAR in August 2012. An updated resource estimate was
prepared by the Company during the second quarter based on drilling results
received to May 5, 2013 (see press release dated June 12, 2013). The drilling
program, subsequent to June 2012, was targeted to increase the amount of
measured and indicated resources related to the potential development of an
underground mine. There has been an 50% increase in resources classified as
measured and indicated from a total of 95,300 troy ounces gold (2012) to 142,533
troy ounces gold and a 28% increase in Resources classified as inferred, from
231,000 troy ounces gold (2012) to 295,599 troy ounces gold (2013). The overall
increase is 34%. Subsequent to June 30, 2013 Galantas filed an updated Technical
Report on SEDAR in July 2013.
Limited exploration outside the mine licence area continued during the first
half of 2013. With regards to the four licences held in the Republic of Ireland,
geochemical soil sampling and geophysical data generated by the Tellus Border
Project, a cross border initiative funded by the EU regional development fund,
was released earlier in the year. The data revealed the continuation of a trend
established on licence OM4 with anomalously high concentrations of gold
pathfinder elements. This data has assisted in the design of a summer field
programme. In addition, following a detailed review of this data, application
was made for three new prospecting licences in the Republic of Ireland which
were granted during the second quarter. These licences join and extend our
existing licences to the southwest. During the second quarter Omagh Minerals
were awarded a grant to complete a project which will determine the
prospectivity potential of the Tellus border zone as a whole. This research is
supported by the EU INTERREG IVA-funded Tellus Border project, a cross border
initiative financed by the EU regional development fund. It is based around the
new Tellus Border data and the associated fieldwork has progressed over the
summer months.
Planning
Discussions continued with the planning services in Northern Ireland during the
second quarter of 2013 with regards to the planning application for an
underground mine plan and accompanying Environmental Statement which were
submitted to the Planning Services in 2012. Consultations with statutory
consultees continue to progress, with a number now confirming that they are
satisfied. Consultations with the remainder are well advanced and the Company
believes it can address outstanding matters raised by the consultees.
Roland Phelps, President & CEO, Galantas Gold Corporation, commented, "The
Company continues to work with Planning Service and consultees to achieve
underground planning consent. The time-line for this is undefined because it is
the hands of other parties. The company has a reasonable expectation that it
will be achieved before the end of the year but this remains uncertain.
Meanwhile, there is a supply of low grade material available for milling.
Further efficiency changes and reductions in manpower have continued to reduce
costs and further cost reductions are planned. We look forward to updating
shareholders in due course."
The detailed results and Management Discussion and Analysis (MD&A) are available
on www.sedar.com and www.galantas.com and the highlights in this release should
be read in conjunction with the detailed results and MD&A. The MD&A provides an
analysis of comparisons with previous periods, trends affecting the business and
risk factors. Some of the production and metal figures are provisional and
subject to averaging or umpiring provisions under the concentrate off-take
contract with Xstrata Corporation (now Glencore Canada Corporation) detailed in
a press release dated 3rd October 2007.
The financial disclosure has been reviewed by Leo O' Shaughnessy (Chief
Financial Officer) and other disclosure by Roland Phelps (President & CEO),
qualified persons under the meaning of NI. 43-101. The information is based upon
financial and other data prepared under their supervision.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS: This press release contains
forward-looking statements within the meaning of the United States Private
Securities Litigation Reform Act of 1995 and applicable Canadian securities
laws, including revenues and cost estimates, for the Omagh Gold project.
Forward-looking statements are based on estimates and assumptions made by
Galantas in light of its experience and perception of historical trends, current
conditions and expected future developments, as well as other factors that
Galantas believes are appropriate in the circumstances. Many factors could cause
Galantas' actual results, the performance or achievements to differ materially
from those expressed or implied by the forward looking statements or strategy,
including: gold price volatility; discrepancies between actual and estimated
production, actual and estimated metallurgical recoveries; mining operational
risk; regulatory restrictions, including environmental regulatory restrictions
and liability; risks of sovereign involvement; speculative nature of gold
exploration; dilution; competition; loss of key employees; additional funding
requirements; planning and other permitting issues; and defective title to
mineral claims or property. These factors and others that could affect
Galantas's forward-looking statements are discussed in greater detail in the
section entitled "Risk Factors" in Galantas' Management Discussion & Analysis of
the financial statements of Galantas and elsewhere in documents filed from time
to time with the Canadian provincial securities regulators and other regulatory
authorities. These factors should be considered carefully, and persons reviewing
this press release should not place undue reliance on forward-looking
statements. Galantas has no intention and undertakes no obligation to update or
revise any forward-looking statements in this press release, except as required
by law.
Galantas Gold Corporation Issued and Outstanding Shares total 256,210,395.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term
is defined in the policies of the TSX Venture Exchange) accepts responsibility
for the adequacy or accuracy of this release.
FOR FURTHER INFORMATION PLEASE CONTACT:
Galantas Gold Corporation
Jack Gunter, P.Eng
Chairman
+44 (0) 2882 241100
Galantas Gold Corporation
Roland Phelps, C.Eng
President & CEO
+44 (0) 2882 241100
www.galantas.com
Charles Stanley Securities (Nominated Adviser)
Mark Taylor
+44 (0)20 7149 6000
Grafico Azioni Galantas Gold (TSXV:GAL)
Storico
Da Dic 2024 a Gen 2025
Grafico Azioni Galantas Gold (TSXV:GAL)
Storico
Da Gen 2024 a Gen 2025
