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TSX-V: JAG
Jaguar Mining Inc. ("Jaguar" or the "Company") (TSX-V: JAG) today announced operational results for the second quarter ended June 30, 2016 ("Q2 2016"). All figures are in US dollars unless otherwise expressed. Full Q2 2016 financial results will be released on or before August 15, 2016.
Second Quarter 2016 Production Highlights
-- Consolidated gold production for Q2 2016 increased 17% to
24,222 ounces year-over-year and is on track to achieve 2016
full year guidance of 90,000 to 95,000 ounces of gold
production.
-- Average consolidated mill head grade increased 10% to 3.76 g/t
year-over-year.
-- Turmalina Q2 2016 gold production increased 45% to 15,083
ounces at an average head grade of 4.10 g/t, up 5%
year-over-year.
-- Primary development investment increased 95% year-over-year to
1,857 metres completed in Q2 2016.
-- Total definition, infill, and exploration drilling of 9,219
metres completed during Q2 2016 focused on key targets at
Turmalina and Caeté. A total of 21,111 metres of drilling has
occurred in the first half of 2016.
-- To support future growth, the Company remains committed to
completing its 2016 capital investment program, which includes
investing in development and exploration activities, a newly
designed paste-fill plant, the rebuild of Mill #3 at Turmalina,
and the upgrading of the Caeté tailings capacity.
-- Cash balance of $17.5 million as at June 30, 2016, after
capital investment programs and payments on debt facility and
convertible debentures interest.
Rodney Lamond, President and Chief Executive Officer of Jaguar commented, "In the first half of 2016 we have accomplished our quarterly production targets and are on track to achieve our full year guidance of 90,000 - 95,000 ounces of gold production. Our second quarter results were solid with increased gold production of 24,222 ounces, up 17% year-over-year, improved average head grades, strong throughput levels, and higher mill recoveries. Our focus on near-term mine plans has taken hold and is driving positive physical results, particularly at Caeté, which increased gold production 68% compared to Q1 2016. Notably, we have made excellent progress with our development program. In the first half of 2016, we invested in development at Turmalina and Caeté, completing more than three kilometres of primary development as we position our assets for future growth. In addition, we completed over 2.3 kilometres of secondary ore development to increase the number of available underground working areas across all mines."
"Also during Q2 2016, we made excellent progress managing our capital position, ending the quarter with a cash balance of $17.5 million, while continuing to carry out our capital investment program and after paying the interest on the convertible debentures. In the first half of 2016, we reinstated our capital investment program at Caeté to complete the Pilar Gold Mine development objectives of accessing the high grade BFII Orebody, and to complete testing and feasibility work for an XRF Ore Sorting system expected to reduce haulage costs. Capital was also spent at the Roca Grande Mine for definition drilling and development during Q2 2016 in an effort to extend mine life. Additionally, at Turmalina, we invested in advancing a newly designed paste-fill plant while also initiating a significant rebuild of Mill #3 that will provide additional capacity going forward. With our strong cash balance and the cash flow generated from our operations, we are well-positioned to execute on the future capital investment program which remains a key driver to growing our sustainable production profile in 2017."
Q2 2016 Operating Summary
Q2 2016 Q2 2015
------- -------
Turmalina Caeté Total Turmalina Caeté Total
--------- ----- ----- --------- ----- -----
Tonnes milled (t) 124,000 93,000 217,000 94,000 116,000 210,000
Average head grade (g/
t) 4.10 3.30 3.76 3.91 3.00 3.41
Recovery rate (%) 91 91 91 90 90 90
Gold ounces
Produced (oz) 15,083 9,139 24,222 10,420 10,262 20,682
Sold (oz) 15,035 8,935 23,969 9,610 9,574 19,184
Development
Primary (m) 1,166 691 1,857 885 66 951
Exploration drift (m) - 44 44 24 - 24
Secondary (m) 693 624 1,317 467 - 467
Definition, infill, and
exploration drilling
(m) 5,011 4,208 9,219 6,104 5,312 11,416
----------------------- ----- ----- ----- ----- ----- ------
Cash BalanceCash balance was $17.5 million as at June 30, 2016, compared to a cash balance of $18.0 million as at March 31, 2016. Capital investments in Q2 2016 have been primarily funded through operating cash flow during the first half of 2016, a trend expected to continue into Q3 2016. In addition to the increase in capital expenditures, Jaguar also paid $0.6 million of interest on the convertible debentures and $0.9 million in debt principal and interest payments during the second quarter.
2016 Guidance Jaguar remains strongly focused on delivering positive and sustainable physical performance, profitability, and cost optimization. The Company's established consolidated production and cost guidance for 2016 continues to represent achievable results from operations:
Turmalina Complex Caeté Complex Consolidated
2016
Guidance Low High Low High Low High
--------- --- ---- --- ---- --- ----
Gold
production
(oz) 62,000 65,000 28,000 30,000 90,000 95,000
Cash
operating
costs
(per
ounce
sold)(1) 600 650 925 975 700 750
All-
in
sustaining
costs
(per
ounce
sold)(1) 850 900 1,150 1,200 950 1,000
Recovery 90% 90% 90% 90% 90% 90%
-------- --- --- --- --- --- ---
Development
Primary (m) 3,000 3,300 1,700 1,900 4,700 5,200
Secondary (m) 3,200 3,400 2,500 2,700 5,700 6,100
------------ ----- ----- ----- ----- ----- -----
Definition,
infill,
and
exploration
drilling
(m) 18,000 20,000 10,000 12,000 28,000 32,000
----------- ------ ------ ------ ------ ------ ------
1. Cash operating costs and all-
in sustaining costs are non-
IFRS financial performance
measures with no standard
definition under IFRS. Refer to
Non-IFRS Financial Performance
Measures below. 2016 cost
guidance has been prepared on
the basis of a foreign exchange
rate of 3.8 Brazilian Reais vs.
the US dollar and a gold price
of US$1,150 per ounce.
About Jaguar Mining Inc.Jaguar Mining Inc. is a Canadian-listed junior gold mining, development, and exploration company operating in Brazil with three gold mining complexes, and a large land package with significant upside exploration potential from mineral claims covering an area of approximate 191,000 hectares. The Company's principal operating assets are located in a prolific greenstone belt in the state of Minas Gerais and include the Turmalina Gold Mine Complex ("Mineracão Turmalina Ltda" or "MTL") and the Caeté Gold Mine Complex ("Mineracao Serras do Oeste Ltda" or "MSOL") which combined produce more than 90,000 ounces of gold annually. The Company also owns the Paciência Gold Mine Complex, which has been on care and maintenance since 2012. Additional information is available on the Company's website at www.jaguarmining.com.
FORWARD-LOOKING STATEMENTS Certain statements in this news release constitute "forward-looking information" within the meaning of applicable Canadian securities legislation. Forward-looking information contained in forward-looking statements can be identified by the use of words such as "are expected", "is forecast", "is targeted", "approximately", "plans", "anticipates", "projects", "anticipates", "continue", "estimate", "believe" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might", or "will" be taken, occur or be achieved. This news release contains forward-looking information regarding expected production, grades, tones milled, recovery rates, cash operating costs, and definition/delineation drilling, in addition to overall expenditures and results of operations for 2016. The Company has made numerous assumptions with respect to forward-looking information contained herein, including, among other things, assumptions about the estimated timeline for the development of its mineral properties; the supply and demand for, and the level and volatility of the price of, gold; the accuracy of reserve and resource estimates and the assumptions on which the reserve and resource estimates are based; the receipt of necessary permits; market competition; ongoing relations with employees and impacted communities; and general business and economic conditions. Forward-looking information involve a number of known and unknown risks and uncertainties, including among others the risk of Jaguar not meeting the forecast plans regarding its operations and financial performance, the uncertainties with respect to the price of gold, labor disruptions, mechanical failures, increase in costs, environmental compliance and change in environmental legislation and regulation, procurement and delivery of parts and supplies to the operations, uncertainties inherent to capital markets in general and other risks inherent to the gold exploration, development and production industry, which, if incorrect, may cause actual results to differ materially from those anticipated by the Company and described herein. Accordingly, readers should not place undue reliance on forward-looking information. For additional information with respect to these and other factors and assumptions underlying the forward-looking information made in this news release, see the Company's most recent annual information form and management's discussion and analysis, as well as other public disclosure documents that can be accessed under the issuer profile of "Jaguar Mining Inc." on SEDAR at www.sedar.com. The forward-looking information set forth herein reflects the Company's reasonable expectations as at the date of this news release and is subject to change after such date. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law. The forward-looking information contained in this news release is expressly qualified by this cautionary statement.
Neither the TSX Venture Exchange nor its Regulations Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Non-IFRS Measures
This press release provides certain financial measures that do not have a standardized meaning prescribed by IFRS. Readers are cautioned to review the above stated footnotes where the Company expanded on its use of non-IFRS measures.
1. Cash operating costs and cash operating cost per ounce are
non-IFRS measures. In the gold mining industry, cash operating
costs and cash operating costs per ounce are common performance
measures but do not have any standardized meaning. Cash operating
costs are derived from amounts included in the Consolidated
Statements of Comprehensive Income (Loss) and include mine site
operating costs such as mining, processing and administration as
well as royalty expenses, but exclude depreciation, depletion
share-based payment expenses and reclamation costs. Cash operating
costs per ounce are based on ounces sold and are calculated by
dividing cash operating costs by commercial gold ounces sold; US$
cash operating costs per ounce sold are derived from the cash
operating costs per ounce sold translated using the average
Brazilian Central Bank R$/US$ exchange rate. The Company discloses
cash operating costs and cash operating costs per ounce as it
believes those measures provide valuable assistance to investors
and analysts in evaluating the Company's operational performance
and ability to generate cash flow. The most directly comparable
measure prepared in accordance with IFRS is total production
costs. A reconciliation of cash operating costs per ounce to total
production costs for the most recent reporting period, the quarter
ended March 31, 2016 is set out in the Company's first quarter
2016 MD&A filed on SEDAR at
www.sedar.com.
2. All-in sustaining costs is a non-IFRS measure. This measure is
intended to assist readers in evaluating the total costs of
producing gold from current operations. While there is no
standardized meaning across the industry for this measure, except
for non-cash items the Company's definition conforms to the all-in
sustaining costs definition as set out by the World Gold Council
in its guidance note dated June 27, 2013. The Company defines
all-in sustaining costs as the sum of production costs, sustaining
capital (capital required to maintain current operations at
existing levels), corporate general and administrative expenses,
and in-mine exploration expenses. All-in sustaining costs exclude
growth capital, reclamation cost accretion related to current
operations, interest and other financing costs and taxes. A
reconciliation of all-in sustaining costs to total production
costs for the most recent reporting period, the quarter ended
March 31, 2016 is set out in the Company's first quarter 2016 MD&A
filed on SEDAR at
www.sedar.com.
SOURCE Jaguar Mining Inc.
To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/July2016/12/c4801.html
SOURCE: Jaguar Mining Inc.
Rodney Lamond, President & Chief Executive Officer, rodney.lamond@jaguarmining.com,
416-628-9601; Hashim Ahmed, Chief Financial Officer, hashim.ahmed@jaguarmining.com,
416-628-9601
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