Cerro Grande Mining Corporation Reports Fiscal Year End Results for the Period Ended September 30, 2012 Compared to 2011
TORONTO, Dec. 13, 2012 /PRNewswire/ – Cerro Grande Mining Corporation
(the “Company” or “CEG”) (TSX: CEG; OTCQX: CEGMF) reported results for
its fiscal year ended September 30, 2012 compared to results of its
fiscal year ended 2011 and the results for its fourth quarter ended
September 30, 2012 compared to the same period in 2011. The Company’s
financial statements, and MD&A for the fiscal year ended 2012 and 2011
have been filed on SEDAR as well as the Company’s’ Annual Information
Form dated December 7, 2012. The Company refers the reader to those
materials for additional information.
Revenues totalled US $27,445,000 for its fiscal year ended 2012 which
includes gold sales of US $22,348,000 (13,575.97 ozs of gold) and
copper and silver sales of US $3,201,000 compared to revenues in its
fiscal year ended 2011 of US $24,289,000 which included gold sales of
US $20,707,000 (14,083.39 ozs of gold) and copper and silver sales of
US $3,582,000. The service revenues of US $1,896,000 for the fiscal
year ended 2012 related to service changes for drilling services on the
Santa Cecilia project against actual expenses of US $1,760,000.
Net income for the fiscal year ended September 30, 2012 was a negative
US $3,712,000 compared to a positive US $3,187,000 for the fiscal year
ended September 30, 2011. Operating costs for the fiscal year end
September 30, 2012 were US $21,100,000 inclusive of depreciation,
depletion and amortization of US $2,286,000 compared to operating costs
of US $15,629,000 inclusive of depreciation, depletion and amortization
costs of US $2,214,000 in fiscal 2011. The increase in operating costs
in fiscal 2012 was caused by an increase in direct labor costs of US
$1,971,000 which included a one time payment of US $677,000 in
settlement of a 4 year labor contract with the Pimenton mine union and
an increase in mining and milling costs of US $3,357,000 which included
an increase in fuel costs, maintenance and repair costs, operating
supplies and external services. General sales and administrative costs
were US $3,368,000 for the fiscal year ended 2012 compared to US
$3,768,000 in fiscal 2011. Exploration costs in fiscal 2012 were US
$3,392,000 compared to US $1,062,000 in fiscal 2011.
The Company had a positive working capital ratio of 1:04 to 1:00, which
included cash and accounts receivable of $3,730,000 for its fiscal
year ended 2012 compared to 1:77 to 1:00 at its fiscal year ended 2011
which included cash and accounts receivable of $3,153,000.
Revenues of the Company for the fourth fiscal quarter of 2012 totalled
US $7,675,000 and included gold sales of US $6,620,000 (3,923.71 ozs
of gold) and copper and silver sales of US $1,055,000 compared to
fourth fiscal quarter of 2011 with total revenues of US $5,574,000
consisting of gold sales of US $4,717,000 (2,743.93 ozs og gold) and
copper and silver sales of US $857,000. The services revenues in the
fourth quarter of 2012 were nil.
Net income of the Company before deferred taxes for the fourth fiscal
quarter ended September 30, 2012 was US $449,000 compared to US
$400,000 in the comparable quarter a year ago.
On a stand alone basis, the Pimenton mine had net earnings for the
fiscal year ended 2012 of US $2,735,000 before deferred tax of US
$881,000 compared to net earnings of US $6,797,000 a year ago. During
the first fiscal quarter of 2012 the Pimenton mine was adversely
impacted by a crown gear failure on the ball mill which substantially
reduced gold, copper and silver production during the quarter.
The Company will receive new mining equipment during the first calendar
quarter of 2013 which is expected to increase its rate of mine
development and reduce the mines’ maintenance and repair costs.
Cash cost per ounce of gold sold at the Pimenton mine, net of by product
credits, was US $1,156.50 in fiscal 2012 compared to US $716.65 per
ounce in fiscal 2011.
Stephen W. Houghton, CEO stated that the Company is working to reduce
expenses at the Pimenton mine and to further increase production from
its current level of 120 tons per day which should reduce its cash cost
per ounce. The Company was able to significantly increase its
exploration costs during its fiscal year ended 2012 while maintaining a
strong balance sheet, which many small junior mining companies have
been unable to accomplish in recent times.
Cerro Grande Mining Corporation is a minerals producing, exploration and
development company with properties and activities currently focused in
Cautionary Statement on Forward-looking Information
This news release contains “forward-looking information”, which may
include, but is not limited to, statements with respect to the future
financial or operating performance of CEG. Often, but not always,
forward-looking statements can be identified by the use of words such
as “plans”, “expects”, “is expected”, “budget”, “scheduled”,
“estimates”, “forecasts”, “intends”, “anticipates”, or “believes” or
variations (including negative variations) of such words and phrases,
or state that certain actions, events or results “may”, “could”,
“would”, “might” or “will” be taken, occur or be achieved.
Forward-looking statements involve known and unknown risks,
uncertainties and other factors which may cause the actual results,
performance or achievements of CEG to be materially different from any
future results, performance or achievements expressed or implied by the
forward-looking statements. Forward-looking statements contained herein
are made as of the date of this press release based on current
expectations and beliefs and CEG disclaims, other than as required by
law, any obligation to update any forward-looking statements whether as
a result of new information, results, future events, circumstances, or
if management’s estimates or opinions should change, or otherwise.
There can be no assurance that forward-looking statements will prove to
be accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly, the
reader is cautioned not to place undue reliance on forward-looking
SOURCE Cerro Grande Mining Corporation