17 Apr 2018 07:00
Full Year 2017 Audited Results
17.04.2018
View the full results announcement http://www.rns-pdf.londonstockexchange.com/rns/1003L_-2018-4-16.pdf
Highland Gold Mining Limited ("the "Company"), the AIM-quoted gold producer, presents its final audited results for the year ended 31 December 2017.
FINANCIAL HIGHLIGHTS
US$000 (unless stated) | 2017 | 2016 | ||
Production (gold and gold eq. oz) | 272,274 | 261,159 | ||
Group all-in sustaining costs (US$/oz) | 664 | 652 | ||
Total Group cash costs (US$/oz) | 507 | 454 | ||
Revenue | 316,682 | 305,901 | ||
Operating profit | 102,202 | 69,361 | ||
EBITDA* | 155,275 | 162,491 | ||
Net profit | 65,855 | 47,909 | ||
Earnings per share (US$) | 0.201 | 0.145 | ||
Net profit before impairment losses | 65,855 | 70,741 | ||
Net cash inflow from operations** | 130,990 | 139,299 | ||
Capital expenditure | 58,336 | 59,349 | ||
Net debt*** | (198,320) | (205,465) | ||
* EBITDA is defined as operating profit/ (loss) excluding depreciation and amortisation, impairment losses, movement in ore stockpiles obsolescence provision, movement in raw materials and consumables obsolescence provision, result of disposal of a non-core entity and gain on settlement of contingent consideration
** 2016 net cash inflow from operations was amended for US$3.1 million reclassified to the investing activities
*** Net debt is defined as cash and cash equivalent, decreased by interest-bearing loans and borrowings and by liability under finance lease
KEY EVENTS
• Total 2017 production of 272,274 oz of gold and gold equivalent, above the guidance range for the year of 255,000-265,000k oz. (2016 production: 261,159 oz).
• Average realised price of gold equivalents was 1,162 USD/oz for the year (2016: US$1,136 per oz).
• Total Cash Costs increased by 11.7% to US$507 per oz, influenced by the stronger rouble, while All-In Sustaining Cash Costs inched up by 1.8% to US$664 per oz.
• Cash inflow from operating activities decreased by 6.0% to US$131.0 million (2016: US$139.3 million)
• Net debt to EBITDA ratio slightly increased to 1.28 as of 31 December 2017 from 1.26 a year earlier.
• Interim dividend of £0.0498 per share paid for H1 2017 (2016: Interim dividend of £0.05 per share).
• Mnogovershinnoye (MNV) - New JORC-compliant reserve estimate at MNV doubled ore reserves and supported the extension of life of mine by four years to at least 2022, with initial results from the ongoing near-mine exploration programme indicating resources for additional years of operation. New exploration licences were received for two areas adjacent to MNV..
• Novoshirokinskoye (Novo) - Updated resource and reserve estimates for Novo supported an increase in gold equivalent ounces by more than 70%, but at lower grades. The planned expansion of ore mining and processing capacity to 1.3 mtpa is ongoing and is now expected to achieve its full capacity in the year 2020.
• Belaya Gora -A pre-feasibility study (PFS) was developed for Belaya Gora including plant upgrades and the treatment of ore from the nearby Blagodatnoye deposit (finalised and released in early 2018). Mining at Belaya Gora continued to focus on processing low-grade ore stockpiles pending the completion of an ongoing project review.
• Kekura - Preparations made for construction and work advanced on a Definitive Feasibility Study (DFS) and updated JORC-compliant mineral resource and ore reserve estimates (finalised and released in early 2018).
• Baley Hub - De-watering programme continued for existing Taseevskoye open-pit with a view to de-risking the project and allowing for further reserve confirmation, with attention now turned to finding new water disposal solutions. On the ZIF-1 Tailings licence, the Board approved funding for design work on a possible heap leach operation.
• Unkurtash - Scoping study completed and released, and discussions held with potential partners for joint project development.
• The Company's Board of Directors adopted a new dividend policy targeting a payout of 20% of net cash flow from operations.
KEY 2018 TARGETS
• Total production of gold and gold equivalent is expected to be in the range of 265,000-275,000 oz.
• MNV -To continue extensive near-mine exploration programme and publish an updated JORC-compliant reserve estimate in Q3 2018.
• Novo - To proceed with construction work on the mine expansion and design work on mill expansion.
• Belaya Gora - To move forward with project development according to the PFS and conduct additional exploration on the Belaya Gora flanks licence.
• Kekura - To build electric substation and other infrastructure facilities, and to continue with procurement, transport and other preparations in advance of the 2019 construction season.
POST YEAR EVENTS
• Second interim dividend of £0.0542 per share approved by the Board of Directors, making a total distribution of £0.104 per share for the year to 31 December 2017 (2016: £0.104 per share).
CONFERENCE CALL DIAL-IN DETAILS
The Company will hold a simultaneous webcast and conference call to discuss the results, hosted by CEO Denis Alexandrov, on 17 April 2018 at 09:00 UK time (11:00 Moscow).
This event is being streamed online and it is recommended that you listen via your computer. The link for online registration is:
https://digital.vevent.com/rt/highlandgoldmining/index.jsp?seid=22
To register to participate by telephone and to receive local dial-in numbers, please follow this link:
http://emea.directeventreg.com/registration/7592279
The Annual General meeting will be held on 24 May 2018.
FOR FURTHER INFORMATION PLEASE CONTACT:
Highland Gold Mining Ltd.
| John Mann, Head of Communications + 7 495 424 95 21 Duncan Baxter, Non-Executive Director + 44 (0) 1534 814 202 |
|
|
Numis Securities Limited (Nominated Adviser and Joint Broker) | John Prior, James Black, Paul Gillam +44 (0) 207 260 1000
|
BMO Capital Markets (Joint Broker) | Jeffrey Couch, Neil Haycock, Pascal Lussier Duquette +44 (0) 207 236 1010 |
|
|
Peat & Co (Joint Broker) | Charlie Peat +44 (0) 207 104 2334 |