COLORADO SPRINGS – July 31, 2018 – Gold Resource Corporation (NYSE American: GORO) (the “Company” or “GRC”) reported production results for the second quarter ended June 30, 2018 of 5,806 ounces of gold and 593,955 ounces of silver, which along with base metal revenue generated $30.8 million in net revenue and $3.8 million, or $0.07 per share in net income for the quarter. Gold Resource Corporation is a gold and silver producer, developer and explorer with operations in Oaxaca, Mexico and Nevada, U.S.A. The Company has returned $111 million to its shareholders in monthly dividends since commercial production commenced July 1, 2010 and offers its shareholders the option to convert their cash dividends into physical gold and silver and take delivery.
Q2 2018 HIGHLIGHTS
- $3.8 million net income, or $0.07 per share
- $30.8 million net sales • 5,806 gold ounces produced
- 593,955 silver ounces produced
- $70 total cash cost per precious metal gold equivalent ounce sold (after by-product credits)
- $577 total all-in sustaining cost per precious metal gold equivalent ounce sold
- $18.0 million base metal by-product credits, or $1,430 per precious metal gold ounce sold
- $0.3 million dividend distributions, or $0.005 per share for quarter
- $26.6 million cash and cash equivalents
- $3.7 million gold and silver bullion
- Received final permit and began construction of Isabella Pearl Gold Project, Nevada
Overview of Q2 2018 Results
During the second quarter of 2018, the Company sold 12,572 precious metal gold equivalent ounces at a total cash cost of $70 per ounce (after by-product credits), benefiting from strong base metal production and sales. Average realized metal prices during the quarter included $1,304 per ounce gold and $16.53 per ounce silver*. The Company recorded net income of $3.8 million, or $0.07 per share. The Company paid $0.3 million to its shareholders in dividends, or $0.005 per share during the quarter. Cash and cash equivalents at quarter end totaled $26.6 million.
Production totals for the first six months of 2018 included 12,453 ounces of gold, 1,019,839 ounces of silver, 772 tonnes of copper, 3,155 tonnes of lead and 9,266 tonnes of zinc. The Company maintains its 2018 Annual Outlook, targeting a plus or minus 10 percent production of 27,000 gold ounces and 1,700,000 silver ounces.
*Average realized metal prices include final settlement adjustments for previously unsettled provisional sales. Provisional sales may remain unsettled from one quarter into the next. Realized prices will therefore vary from average spot metal market prices upon final settlement.
The following Production Statistics table summarizes certain information about our mining operations for three and six months ended June 30, 2018 and 2017:
- Based on actual days the mill operated during the period.
- Metal production represents metal contained in concentrates and doré produced at our Aguila processing facility, which is before payable metal deductions are levied by the buyers. Payable metals deductions are defined in our contracts with the buyers and represent estimates of metals contained in the concentrates and doré which the buyers deduct from payment. There are inherent limitations and differences in the sampling method and assaying of estimated metal contained in concentrates and doré that are shipped, and those contained metal estimates are derived from sampling methods and assaying throughout the production process. We monitor these differences to ensure that precious metal production quantities are materially correct.
The following Sales Statistics table summarizes certain information about our combined mining operations for the three and six months ended June 30, 2018 and 2017
- Average metal prices realized vary from the market metal prices due to final settlement adjustments from our provisional invoices when they are settled. Our average metal prices realized will therefore differ from the market average metal prices in most cases.
- For a reconciliation of this non-GAAP measure to total mine cost of sales, which is the most comparable U.S. GAAP measure, please see NonGAAP Measures in the Company’s most recently filed 10-Q.
- Total cash cost (credit) was significantly affected by unusually high base metals sales as compared to precious metals sales.
See Accompanying Tables
The following information summarizes the results of operations for Gold Resource Corporation for the three and six months ended June 30, 2018 and 2017, its financial condition at June 30, 2018 and December 31, 2017 and its cash flows for the six months ended June 30, 2018 and 2017. The summary data as of June 30, 2018 and for the three and six months ended June 30, 2018 and 2017 is unaudited; the summary data as of December 31, 2017 is derived from our audited financial statements contained in our annual report on Form 10-K for the year ended December 31, 2017, but do not include the footnotes and other information that is included in the complete financial statements. Readers are urged to review the Company’s Form 10-K in its entirety, which can be found on the SEC’s website at www.sec.gov.
The calculation of our cash cost per precious metal gold equivalent ounce, total all-in sustaining cost per precious metal gold equivalent ounce and total all-in cost per precious metal gold equivalent ounce contained in this press release are non-GAAP financial measures. Please see “Management’s Discussion and Analysis and Results of Operations” contained in the Company’s most recent Form 10-Q and Form 10-K for a complete discussion and reconciliation of the non-GAAP measures.
