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Mandalay Resources Corporation Announces Production and Sales Results for the Second Quarter, 2014

July 10, 2014

TORONTO, July 10, 2014 /CNW/ – Mandalay Resources Corporation
(“Mandalay” or the “Company”) (TSX: MND) announced today its production
and sales results for the second quarter, 2014.

Brad Mills, Chief Executive Officer of Mandalay, commented: “Mandalay’s
operations delivered steady operational performance in the second
quarter. Cerro Bayo operations achieved a rate of 1,350 tonnes per day
(“tpd”) of ore production in June, just short of its targeted expansion
rate of 1,400 tpd. Costerfield delivered its first production ore from
the Cuffley lode development in the quarter and is on track to ramp up
production to 50% of ore feed by year-end. With Cerro Bayo operating at
the higher production rate and Cuffley starting to deliver stoping ore
in the coming quarters, both operations are on track to achieve their
full year production guidance.”

Saleable production for the three months ended June 30, 2014:

        --  The Company produced a total of 14,079 ounces ("oz") gold
            ("Au"), 855 tonnes ("t") antimony ("Sb"), and 741,382 oz silver
            ("Ag"), representing a total of 31,751 oz of gold equivalent
            ("Au Eq.") production, down 5.4% compared to the 2013 period.
            The main difference in the gold equivalent production volume is
            attributed to the exceptionally high silver grade produced at
            Cerro Bayo in the similar period of 2013.

        --  Production at Costerfield (Australia) was 7,256 oz Au and 855 t
            Sb, up 5.6% and 15.9% respectively on higher volumes of ore
            mined and processed in 2014 compared to 2013.

        --  Production at Cerro Bayo (Chile) was 6,823 oz Au and 741,382 oz
            Ag, up 10.6% and down 19.6% respectively, compared to 2013. The
            differences with the corresponding quarter last year are due to
            lower silver grades realized in this period, partially offset
            by higher mining and processing rates in 2014 compared to 2013.

Saleable production for the six months ended June 30, 2014:

        --  The Company's production totaled 27,274 oz Au, 1,713 t Sb, and
            1,484,951 oz Ag, representing a total of 63,188 oz of Au Eq.
            More antimony and gold with slightly less silver were produced
            in the 2014 half as compared to the 2013 half. Equivalent gold
            production increased by 4% year-on-year.

        --  Production at Costerfield was 15,171 oz Au and 1,713 t Sb for
            the 2014 half, up 16% and 13.9% respectively year-on-year,
            compared to the same period in 2013.

        --  Production at Cerro Bayo was 12,103 oz Au and 1,484,951 oz Ag
            in the 2014 half, up 14.2% and down 3.2% respectively, compared
            to the prior year period.

Table 1 – Second Quarter and Six-Month Saleable Production for 2014 and
2013


                                     3           3           Six           Six
                                  months      months       months        months
       Metal         Source         to          to          ended         ended
                                  30 June     30 June      30 June       30 June
                                   2014        2013         2014          2013

    Gold (oz)     Costerfield       7,256       6,879        15,171        13,082

                  Cerro Bayo        6,823       6,167        12,103        10,599

                  Total            14,079      13,046        27,274        23,681

    Antimony
    (t)           Costerfield         855         738         1,713         1,504

    Silver
    (oz)          Cerro Bayo      741,382     921,895     1,484,951     1,533,337

    Average
    quarterly
    prices:                                                                      

    Gold
    US$/oz                          1,289       1,415                            

    Antimony
    US$/t                           9,602      10,365                            

    Silver
    US$/oz                          19.63       23.19                            

    Au Eq.
    (oz)1         Costerfield      13,628      12,283        28,019        23,715

                  Cerro Bayo       18,111      21,275        35,169        36,972

                  Total            31,739      33,558        63,188        60,687

(1 )Quarterly Au Eq. oz produced is calculated by multiplying the saleable
quantities of Au, Ag, and Sb in the period by the respective average
market prices of the commodities in the period, adding the three
amounts to get a “total contained value based on market price”, and
then dividing that total contained value by the average market price of
Au in the period. Average Au price in the period is calculated as the
average of the daily LME PM fixes in the period, with price on weekend
days and holidays taken of the last business day; average Sb price in
the period is calculated as the average of the daily average of the
high and low Rotterdam warehouse prices for all days in the period,
with price on weekend days and holidays taken from the last business
day; average Ag price in the period is calculated as the average of the
daily London Broker’s silver spot price for all days in the period,
with price on weekend days and holidays taken from the last business
day. The source for all prices is
www.metalbulletin.com.

Sales for the three months ended June 30, 2014:

        --  The Company sold 14,957 oz Au, 879 t Sb, and 840,713 oz Ag,
            representing a total of 34,307 oz Au Eq, up 12.1% compared to
            2013.

        --  Costerfield sold 7,298 oz Au and 879 t Sb, up 6.5% and 15.2%
            respectively, compared to 2013.

        --  Cerro Bayo sold 7,659 oz Au, (record quarterly gold sales), and
            840,713 oz Ag, up 6.5% and 8.5% respectively, compared to 2013.

Sales for the six months ended June 30, 2014:

        --  The Company sold 26,807 oz Au, 1,503 t Sb, and 1,612,829 oz Ag,
            representing a total of 63,097 oz Au Eq, up 10% from the prior
            year period.

        --  Costerfield sold 14,344 oz Au and 1,503 t Sb, up 12.7% and down
            1%, compared to the same period in 2013.

        --  Cerro Bayo sold 12,463 oz Au and 1,612,829 oz Ag, up 30.3% and
            14.7% respectively, compared to the 2013 period. The 2013
            similar period was impacted by shipping delays due to a port
            strike in southern Chile.

Table 2 – Second Quarter and Six Month Sales for 2014 and 2013


                                     3           3           Six           Six
                                  months      months       months        months
       Metal         Source         to          to          ended         ended
                                  30 June     30 June      30 June       30 June
                                   2014        2013         2014          2013

    Gold (oz)     Costerfield       7,298       6,850        14,344        12,731

                  Cerro Bayo        7,659       5,449        12,463         9,564

                  Total            14,957      12,299        26,807        22,295

    Antimony
    (t)           Costerfield         879         763         1,503         1,518

    Silver
    (oz)          Cerro Bayo      840,713     774,923     1,612,829     1,406,659

    Average
    quarterly
    prices:                                                                      

    Gold
    US$/oz                          1,289       1,415                            

    Antimony
    US$/t                           9,602      10,365                            

    Silver
    US$/oz                          19.63       23.19                            

    Au Eq.
    (oz)2         Costerfield      13,847      12,441        25,604        23,474

                  Cerro Bayo       20,460      18,149        37,493        33,902

                  Total            34,307      30,590        63,097        57,376

(2)Quarterly Au Eq. oz sold is calculated by multiplying the saleable
quantities of Au, Ag, and Sb in the period by the respective average
market prices of the commodities in the period, adding the three
amounts to get a “total contained value based on market price”, and
then dividing that total contained value by the average market price of
Au for the period. The source for all prices is www.metalbulletin.com with price on weekend days and holidays taken of the last business day.

About Mandalay Resources Corporation:

Mandalay Resources is a Canadian-based natural resource company with
producing assets in Australia and producing and development projects in
Chile. The Company is focused on executing a roll-up strategy, creating
critical mass by aggregating advanced or in-production gold, copper,
silver and antimony projects in Australia and the Americas to generate
near-term cash flow and shareholder value.

Forward-Looking Statements:

This news release contains “forward-looking statements” within the
meaning of applicable securities laws, including statements regarding
the Company’s production of gold, silver and antimony for the 2014
fiscal year. Readers are cautioned not to place undue reliance on
forward-looking statements. Actual results and developments may differ
materially from those contemplated by these statements depending on,
among other things, changes in commodity prices and general market and
economic conditions. The factors identified above are not intended to
represent a complete list of the factors that could affect Mandalay. A
description of additional risks that could result in actual results and
developments differing from those contemplated by forward-looking
statements in this news release can be found under the heading “Risk
Factors” in Mandalay’s annual information form dated March 28, 2014, a
copy of which is available under Mandalay’s profile at www.sedar.com.
In addition, there can be no assurance that any inferred resources that
are discovered as a result of additional drilling will ever be upgraded
to proven or probable reserves. Although Mandalay has attempted to
identify important factors that could cause actual actions, events or
results to differ materially from those described in forward-looking
statements, there may be other factors that cause actions, events or
results not to be as anticipated, estimated or intended. 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, readers should not place
undue reliance on forward-looking statements.

SOURCE Mandalay Resources Corporation


Source: PR Newswire



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