VANCOUVER,
July 30, 2013 /CNW/ - Sierra
Metals Inc. (TSX:SMT)(BVL:SMT) ("Sierra Metals" or the
"Company") announces the filing of Sociedad Minera Corona S.A.'s
("Corona") unaudited Financial Statements and Management Discussion
and Analysis ("MD&A") for the second quarter of 2013. The
Company holds an interest of 81.8% in Corona. All amounts are presented in thousands
of US dollars unless otherwise stated and have not been adjusted
for the 18.2% non-controlling interest.
Daniel Tellechea,
President and CEO of Sierra Metals, commented: "Corona's production for the first half of 2013
was in line with our expectations and we anticipate meeting our
2013 guidance. In addition, Corona
has successfully implemented cost reductions measures at the mine
and plant reflected in the month of June. However, the overall
financial results for the second quarter of 2013 reflect the
significant decrease in commodity prices. We are in the process of
analyzing additional cost reduction measures for the second half of
2013. Corona shows strong upside
potential and the Company will continue with the development of a
new shaft in the Central Mine Area. This project will improve the
production profile in Peru in the
medium term."
The following table sets out select unaudited
financial information for the first half of 2013 and 2012:
|
|
Six months
ended |
(In thousands of US dollars, unless
stated) |
|
|
June 30, 2013 |
|
June 30, 2012 |
Revenue |
|
|
60,554 |
|
73,555 |
Adjusted EBITDA |
|
|
28,606 |
|
43,773 |
Cash Flow from continuing operations |
|
|
3,552 |
|
18,380 |
Income Taxes 1 |
|
|
(7,567) |
|
(6,419) |
Non-recurring gain on asset sale 1 |
|
|
- |
|
9,954 |
Net Income |
|
|
10,989 |
|
37,430 |
Cash Cost per oz of Ag (Yauricocha) |
US$ |
|
(18.14) |
|
(27.63) |
Exchange Rate (PEN / US$) 2 |
|
|
2.618 |
|
2.674 |
|
|
|
|
|
|
(In thousands of US dollars) |
|
|
June 30, 2013 |
|
December 31, 2012 |
Cash and cash equivalents |
|
|
25,838 |
|
72,071 |
Assets |
|
|
101,013 |
|
141,826 |
Liabilities |
|
|
39,979 |
|
52,231 |
Net Debt 3 |
|
|
(14,838) |
|
(61,071) |
Equity |
|
|
61,034 |
|
89,595 |
1
Includes a US$ 3.9 million reclassification from income taxes to
gain on asset sale. |
2 Peruvian Soles (PEN) per US
Dollar (US$). |
|
|
|
|
|
3 Consolidated debt minus
cash and cash equivalents. |
|
|
|
|
|
Corona's
Financial Highlights
- Net income of US$ 1.8 million or
US$0.051 per share for the second
quarter of 2013 compared to US$ 12.8
million or US$ 0.513 per share
for the same period in 2012. Net income of US$ 11.0 million or US$0.305 per share for the first half of 2013
compared to US$ 37.4 million or
US$ 1.040 per share for the same
period in 2012.
- Adjusted EBITDA of US$ 11.4
million for the second quarter of 2013 compared to
US$ 21.8 million for the same period
in 2012. Adjusted EBITDA of US$ 28.6
million for the first half of 2013 compared to US$ 43.8 million for the same period in 2012. The
adjusted EBITDA generated by Corona during 2013 was negatively impacted by
the decrease in the commodity prices. The average realized price of
silver and copper for the second quarter of 2013 has decreased 24%
and 14%, respectively compared to the same period in 2012. The
average realized price of silver and copper for the first half of
2013 has decreased 17% and 10%, respectively compared to the same
period in 2012.
- Operating cash flows of US$ 2.9
million for the second quarter of 2013 compared to
US$ 12.3 million for the same period
in 2012. Operating cash flows of US$ 3.6
million for the first half of 2013 compared to US$ 18.4 million for the same period in 2012. The
main drivers of operating cash flow on the first half of 2013 were
EBITDA of US$ 28.6 million, uses of
working capital for US$ 12.8 million
and payment of taxes for US$ 12.1
million. The uses of working capital for US$ 12.8 million include a payment of the 2012
profit sharing liability for US$ 7.8
million. No other payments for profit sharing obligations
are due during 2013. The rest of working capital items are expected
to reverse over the next few quarters. Thus, we expect cash flows
from operations to improve during the second half of the year.
- Income taxes of US$ 3.3 million
for the second quarter of 2013 compared to US$ 4.7 million in the same period of 2012.
Income taxes of US$ 7.6 million for
the first half of 2013 compared to US$ 6.4
million in the same period of 2012.
- Revenues of US$ 27.3 million in
the second quarter of 2013 compared to US$
33.5 million for the same period in 2012. Revenues of
US$ 60.6 million in the first half of
2013 compared to US$ 73.6 million for
the same period in 2012.
- Cash and cash equivalents of US$ 25.8
million as of June 30, 2013
compared to US$ 72.1 million as of
December 31, 2012. Cash and cash
equivalents have decreased during the first half of 2013 mainly as
a result of the dividend paid by Corona of US$ 38.8
million and capital expenditures of US $9.2 million.
- A negative silver ("Ag") cash cost of US$ 13.78 per ounce ("oz") at Yauricocha in the
second quarter of 2013 compared to a negative cash cost of
US$ 22.06 in the same period of 2012.
A negative silver ("Ag") cash cost of US$
18.14 per ounce ("oz") at Yauricocha in the second quarter
of 2013 compared to a negative cash cost of US$ 27.63 in the same period of 2012.
Corona's
Operational Highlights
- Silver ("Ag") production of 481,058 oz in the second quarter of
2013 compared to 544,707 oz for the same period in 2012. Silver
production of 955,660 oz in the first half of 2013 compared to
1,037,139 oz for the same period in 2012.
- Copper ("Cu") production of 1.7 million pounds ("lb") in the
second quarter of 2013 compared to 2.2 million lb for the same
period in 2012. Copper production of 3.9 million pounds ("lb") in
the first half of 2013 compared to 4.8 million lb for the same
period in 2012.
- Lead ("Pb") production of 9.4 million lb in the second quarter
of 2013 compared to 9.0 million lb for the same period in 2012.
Lead ("Pb") production of 17.8 million lb in the first half of 2013
compared to 16.8 million lb for the same period in 2012.
- Zinc ("Zn") production of 12.1 million lb in the second quarter
of 2013 compared to 11.5 million lb for the same period in 2012.
Zinc ("Zn") production of 25.2 million lb in the first half of 2013
compared to 21.9 million lb for the same period in 2012.
- Gold ("Au") production from the Yauricocha Mine was 1,800 oz in
the second quarter of 2013 and 2,876 oz for the same period in
2012. Gold ("Au") production from the Yauricocha Mine was 3,398 oz
in the first half of 2013 and 5,901oz for the same period in
2012.
The following table sets out production results
for the second quarter ended June 30,
2013 and 2012:
Yauricocha Production |
3 Months Ended |
|
6 Months Ended |
|
|
June 30, 2013 |
June 30, 2012 |
|
% Var. |
|
June 30, 2013 |
June 30, 2012 |
|
% Var. |
|
|
|
|
|
|
|
|
|
|
|
Silver production (oz) |
|
481,058 |
544,707 |
|
-12% |
|
955,660 |
1,037,139 |
|
-8% |
Copper production (000 lb) |
|
1,714 |
2,212 |
|
-23% |
|
3,889 |
4,846 |
|
-20% |
Lead production (000 lb) |
|
9,382 |
8,958 |
|
5% |
|
17,761 |
16,804 |
|
6% |
Zinc production (000 lb) |
|
12,121 |
11,465 |
|
6% |
|
25,167 |
21,950 |
|
15% |
Gold Production (oz) |
|
1,800 |
2,876 |
|
-37% |
|
3,398 |
5,901 |
|
-42% |
|
|
|
|
|
|
|
|
|
|
|
About Sierra Metals
Sierra Metals Inc. is a Canadian mining company
focused on precious and base metals from its Yauricocha Mine in
Peru, its Bolivar Mine and Cusi
Mine in Mexico. In addition,
Sierra Metals is exploring several precious and base metal targets
in Peru and Mexico. Projects in Peru include Adrico (gold), Victoria (copper-silver) and Ipillo
(polymetallic) at the Yauricocha Property in the province of Yauyos
and the San Miguelito gold
properties in Northern Peru.
Projects in Mexico include
Bacerac (silver) in the
state of Sonora, La Verde (gold) at the Batopilas Property in
the state of Chihuahua, and
Las Coloradas (silver) at the
Melchor Ocampo Property in the state of Zacatecas.
The Company's shares trade on the Bolsa de
Valores de Lima and the Toronto
Stock Exchange under the symbol "SMT".
Forward-Looking Statements
Except for statements of historical fact
contained herein, the information in this press release may
constitute "forward-looking information" within the meaning of
Canadian securities law. Other than statements of historical fact,
all statements are "forward-looking statements", which involve
various known and unknown risk and uncertainties and other factors,
including market conditions that may affect the Company's ability
to execute its current business plan. Actual results might
differ materially from results suggested in any forward-looking
statements. The Company assumes no obligation to update the
forward-looking statements, or to update the reasons why actual
results could differ from those reflected in the forward-looking
statements unless and until required by securities laws applicable
to the Company. Additional information identifying risks and
uncertainties is contained in filings by the Company with the
Canadian securities regulators, which filings are available at
www.sedar.com.
SOURCE Sierra Metals Inc.