Andean American loses $19.54-million in 2007
2007-08-02 16:53 ET - News Release
Mr. John Huguet reports
ANDEAN AMERICAN MINING ANNOUNCES 2007 FINANCIAL AND OPERATIONAL RESULTS
Andean American Mining Corp. has released today its audited financial results for the fiscal year ended March 31, 2007.
Highlights
Financial:
Recorded a net loss of $19,547,282, or 38 cents per share, for year, $15,680,373 of which were one-time items, compared with net earnings of $730,777, or two cents per share in 2006;
The net loss is mainly attributable to asset impairment charges of $9,594,206 and the $6,086,167 loss on dilution incurred on the sale of Corporacion Minera Sinchao;
Produced 8,397 ounces of gold and gold equivalents in 2007, compared with 16,971 ounces in 2006;
Revenues were $5,901,665 in 2007, compared with $9,038,330 in 2006;
Capital expenditures in 2007 amounted to $3,100,823, compared with $3,890,675 in 2006, mainly for exploration activities and acquisitions.
Operational:
In October, 2006, Andean received a National Instrument (NI) 43-101 technical report on Invicta outlining an estimated 4.8 million tonnes in measured and indicated resources and 8.3 million tonnes in inferred resources;
At Sinchao, 64 surface samples were collected over 1,500 metres, averaging 14.27 per cent zinc, 2.4 per cent lead, 1.4 per cent copper, 85 g/t silver and 1.87 g/t gold in January, 2007;
Subsequent to the year-end, Andean received drill results from hole AE-DDH-07-30 intersecting 14.25 metres grading 18.45 g/t gold and 18.50 metres grading 2.87 per cent copper at the Invicta project;
A 10,000-metre drill program continues to upgrade the inferred resources to the measured category at Invicta.
2007 results
Andean recorded a net loss of $19,547,282, or 38 cents per share, for the year compared with net earnings of $730,777, or two cents per share, in 2006. In addition to the writedown of the carrying values of the Santa Rosa mine and certain exploration projects in the amount of $9,594,206 and the $6,086,167 loss on dilution incurred on the sale of Corp. Minera Sinchao (CMS), the loss was due to low recoveries, low volumes of material treated and higher unit costs from the processing of recycled material. Production of gold equivalents was 8,397 ounces compared with 16,971 ounces in fiscal 2006 when fresh ore was being processed.
Revenues were $5,901,665 in 2007 compared with $9,038,330 in 2006. The revenue decrease in 2007 was due to lower sales volumes partially offset by higher prices for gold and silver.
Cash flow in 2007 was a deficit of $2,099,870, compared with $2,544,024 of positive cash flow in 2006. The reduction in cash flow from operations in 2007 was due to the reduction of gold and silver sold and an increase in the cost of sales mainly due to poor recoveries, lower volumes of recycled material treated and elimination of processing fresh ore until the metallurgical problems were solved.
At March 31, 2007, the company had a net cash deficit of $44,231 and long-term debt of $101,217. At March 31, 2006, the company had an available cash balance of $810,500 and a restricted cash balance of $265,597.
"We have taken a decision to write down the values of our Santa Rosa mine to the fair market value of material for recycling and minable reserves only. We have not given credibility to the potential as yet undiscovered at Santa Rosa. Andean is committed to fulfilling its goal to produce 200,000 ounces of gold and gold equivalents by 2010. In order to reach this goal, we have focused our efforts on exploration and development at the Invicta and Sinchao properties," stated John Huguet, chairman and chief executive officer of Andean American. "We have had some exciting drill hole results from our drill programs at Invicta and Sinchao, and we look forward to releasing more results as we receive them in the near future," he continued.
Investors are cautioned that the company has not yet completed a feasibility study and there is no certainty that the projections will be achieved, or that the proposed operations will be economically viable. The Invicta property is not currently in production. The prefeasibility report for the Invicta property is expected within 60 days.
CONSOLIDATED STATEMENT OF OPERATIONS AND (DEFICIT)
Years ended
March 31, March 31,
2007 2006
Revenue
Sales of metals $ 5,901,665 $ 9,038,330
------------ ------------
Operating expenses
Direct operating costs 6,215,261 4,659,345
Royalty expense 104,644 152,784
Amortization and depletion 864,670 1,155,998
Selling expenses 159,252 207,048
Stock based compensation 615,767 573,099
Reclamation 22,486 16,200
------------ ------------
7,982,080 6,764,474
------------ ------------
Gross profit (loss) (2,080,415) 2,273,856
------------ ------------
Other expenses
General and administrative expenses (1,679,082) (1,379,367)
Interest expense (107,103) (286,441)
Other income 74,054 12,109
Foreign exchange (loss) gain (440,519) 110,620
(Loss) on dilution (6,086,167) -
Writedown of mineral properties (7,715,233) -
Writedown of property, plant and equipment (1,286,674) -
Write-off of exploration properties (592,299) -
------------ ------------
(19,913,438) 730,777
------------ ------------
Less minority interest 366,156 -
------------ ------------
Net income (loss) for the year $(19,547,282)$ 730,777
(Deficit) -- beginning of year (16,357,225) (17,088,002)
------------ ------------
(Deficit) -- end of year $(35,904,507)$(16,357,225)
============ ============
Earnings (loss) per common share
Basic $ (0.38)$ 0.02
Diluted $ (0.38)$ 0.02
Text zur Anzeige gekürzt. Gesamten Beitrag anzeigen »