San Gold Reports Improved Results
TSX: SGR || OTCQX: SGRCF
BISSETT, MB, May 13 /PRNewswire-FirstCall/ – George Pirie, President and CEO of San Gold
Corporation, (TSX: SGR) (OTCQX: SGRCF) released the company’s first
quarter 2011 financial statements today. They reflect a large
improvement in performance at the Rice Lake Project in Bissett.
Mr. Pirie said “that San Gold continues to be one of the most exciting
gold mining and exploration companies in Canada with huge gold
potential. We expect production to increase and cash costs per ounce
of gold to decrease substantially throughout the balance of 2011. In
addition, we continue with a very aggressive exploration drilling
program, on the large prospective land package surrounding the
operating mines. This drilling program demonstrates the size and
strength of the gold mineralization within the newly discovered
Shoreline Basalt and is allowing us to develop a new mine complex along
this mafic unit.”
The Company recognized revenue of $19.8 MM during the quarter and
experienced an operating income from operations of $3.2 MM. The
comprehensive loss from operations for the quarter was $5.3 MM.
Comparable figures for the first quarter of 2010 are revenue of $14.0
MM, operating loss of $2.3 MM and a comprehensive loss of $2.7 MM.
The quarter generated positive cash flow from operations of $4.4 MM.
Cash cost was $862 per ounce and $146 per ton. This represents a 60%
reduction in cash cost per ton in comparison to the same quarter last
year and a 35% reduction in the cash cost per ounce. This is
consistent with management’s objective of reducing costs this year as
we transition to a steady state producer. (Please see discussion on Non-IFRS financial measures for a detailed
calculation and reconciliation of these figures to our IFRS financial
San Gold completed 87,000 metres of diamond during the first quarter of
2011. Of this, about 44,000 metres was drilled underground with the
balance of 43,000 metres drilled from surface. These totals are
slightly ahead of San Gold’s 2011 plan.
San Gold invested $10.7 MM for the purchase of equipment during the
quarter and capitalized development on mineral properties of $12.9 MM.
This Capital investment positions San Gold well early in 2011 to
achieve the budgeted increases in mine and mill production. San Gold
maintains its expectation to produce 80,000 ounces during 2011 and
approach cash costs of $650 per ounce by year end.
As at March 31st, 2011, the Company had a working capital surplus of
$59.0 MM compared to a working capital surplus of $33.2 MM at March
31st, 2010. During the quarter, the Company completed a Flow-Through
financing designed to fund exploration expenditure through 2011 and
into 2012. Liquidity remains excellent and the Company continues to
have sufficient cash reserves to meet currently planned exploration and
The information in this release may contain forward-looking information
under applicable securities laws. This forward-looking information is
subject to known and unknown risks, uncertainties and other factors
that may cause actual results to differ materially from those implied
in the forward-looking information.
SAN GOLD CORPORATION CONSOLIDATED STATEMENTS OF LOSS AND COMPREHENSIVE LOSS FOR THE THREE MONTH PERIOD ENDED MARCH 31 2011 2010 REVENUE $ 19,817,478 $ 13,988,260 OPERATIONS Operations (Note 16,619,833 16,278,889 16) INCOME (LOSS) FROM 3,197,645 OPERATIONS (2,290,629) Exploration 5,305,747 2,662,783 General and administrative 3,170,564 3,247,710 (Note 17) LOSS BEFORE OTHER REVENUE AND 5,278,666 8,201,122 EXPENSES OTHER REVENUE AND EXPENSES Finance income - 61,533 net (Note 18) 75,266 Finance costs (118,636) (Note 18) (35,808) Equity loss of associate (Note 9) - (128,667) LOSS BEFORE INCOME 5,335,769 8,290,331 TAX Income tax recovery on 5,568,350 flow-through - shares (Note 19) TOTAL LOSS AND COMPREHENSIVE LOSS 5,335,769 2,721,981 FOR THE PERIOD LOSS PER COMMON SHARE: Basic & $ 0.02 $ 0.01 diluted (Note 22)
SOURCE San Gold Corporation