Aurcana Corporation (“Aurcana” or the “Company”) (TSXV: AUN, OTCQX: AUNFF”) is pleased to report its unaudited financial results for the first quarter ended March 31, 2012. The summary of the selected financial information should be read in conjunction with the Condensed Interim Consolidated Financial Statements (Unaudited) and the related Management Discussion and Analysis for the quarter ended March 31, 2012 dated May 24, 2012 together referred to as the “Financial Statements”, which have been filed on SEDAR (www.sedar.com) and the Company’s website (http://www.aurcana.com). All figures are in US dollars unless otherwise noted.
The most significant highlights for the 1st quarter ending March 31, 2012 were:
- Revenues increased 6% to 11.6 million in Q1, 2012 from 10.9 million in Q1, 2011.
- 186% increase in net income, $2.0 million in Q1, 2012 compared to $0.7 million in Q1, 2011.
- 21% increase in operating cash flow before movements in working capital, to $5.7 million in Q1, 2012 compared to $4.7 million in Q1, 2011.
- Earnings from mining operations increased 2% in Q1, 2012, $5.5 million compared to $5.4 million in Q1, 2011.
- 20% increase in silver production of 287,486 ounces (258,767 ounces sold) in Q1 2012 compared to 240,275 ounces in Q1, 2011 (218,701 ounces sold).
- The upgrade of the La Negra mill was completed on March 31, 2012, increasing production from 1,500 tpd to 2,000 tpd, a 33% increase in production capacity.
During the quarter ended March 31, 2012, the Company generated revenues from the sale of 3,266 tonnes of zinc concentrate (2011: 1,364 tonnes); 1,570 tonnes of copper concentrate (2011: 3,050 tonnes); 737 tonnes of lead concentrate (2011: nil); and 258,767 ounces of silver (2011: 218,701 ounces) for total net revenues of $11.6 million (2011: $10.9 million).
The average price for sales of zinc, copper, silver and lead during the period were Zn $0.91 (2011: $1.09) per pound; Cu $3.76 (2011: $4.37) per pound; Ag $32.80 (2011: $31.95) per ounce; Pb $0.95 (2011: nil) per pound.
Earnings
The Company had earnings from mining operations of $5.5 million for the quarter ended March 31, 2012 (2011: $5.4 million); income before taxes of $2.7 million (2011: $1.6 million); a net income of $2.0 million (2011: $ 0.7 million).
The increase in earnings from operations was mainly related to volumes sold and the increase of higher grades of the metals in the concentrates produced by the Company.
La Negra Mine Production Highlights
- La Negra completed its second consecutive mine expansion from 1,500 tpd to 2,000 tpd production capacity on time and on budget for a cost of $4.5 Million.
- 130,570 mill feed tonnes of ore processed during the current quarter, 15% (18,948) from NI-43-101 Measured and Indicated Resources and 85% (111,622) from new discoveries or non-compliant resources. All new mineralized zones will be NI 43-101 compliant.
- 15% increase in Copper, Zinc and Lead concentrate produced during current quarter, 5,356 tonnes (2011: 4,684).
- 2% increase in ore mined to 132,438 tonnes in Q1 2012 from 129,612 tonnes in Q1 2011.
- La Negra’s production increase was supported by a continuous in-house diamond drilling program.
- Construction at the Shafter silver mine in Texas has been successfully completed two months ahead of schedule and under budget. Commissioning and testing of the processing plant began on April 1, 2012. The ramp up to reach the 1,500 tpd production is expected by early Q3. Power was initially supplied by generators, but now the mill is operating on existing power from the grid.
- Drilling has defined another 150 feet to the resource of the 1st block.
- The warehouse building, cyanide mixing plant and potable water system are now complete.
To read complete MD&A click on this link: http://www.aurcana.com/i/pdf/2012Q1MDA.pdf
Corporate
The Company’s shares are now also traded in the United States on OTCQX under the symbol “AUNFF”. Investors can find current financial disclosure and Real-Time Level 2 quotes for the Company on www.otcqx.com and www.otcmarkets.com.
About Aurcana Corporation:
The Shafter Silver Mine is scheduled to produce 3.8 million ounces of silver in the first full 12 months of operation. It has an NI 43-101 Measured and Indicated Resource of 24.6 million ounces of silver and an Inferred Resource of 22.8 million ounces of silver using a 4.0 ounce per ton cut off. The 99.9% owned La Negra silver-lead-zinc-copper mine produced over 1 million ounces of contained silver in 2011 and 287,486 ounces for Q1 2012.
The reader should be cautioned that the Company has not completed a feasibility study to confirm the projected production capacity for La Negra and there is no certainty the Company’s plans will be economically viable.
The scientific and technical information contained in this news release regarding the Shafter Silver Mine has been reviewed by Ken Collison, P.Eng. Director of the Company, and a Qualified Person (“QP”) and scientific and technical information contained in this news release regarding the La Negra Mine has been reviewed by Baltazar Solano, P.Eng. and a QP). as defined by National Instrument 43-101 (Standards of Disclosure for Mineral Project)
ON BEHALF OF THE BOARD OF DIRECTORS OF
AURCANA CORPORATION
“Lenic Rodriguez”, President & CEO
For further information, visit the website at www.aurcana.com or contact:
Aurcana Corporation
Phone: (604) 331-9333
Toll Free: (866) 532-9333
Fax: (604) 633-9179
Gary Lindsey, Corporate Relations
Phone: (720)-273-6224
Email: [email protected]
NR-12-08
This news release contains certain forward-looking statements, including statements regarding forecast silver production, silver grades, recoveries, potential mineralization, exploration result, future plans and objectives of the Company and the business and anticipated financial performance of the Company. These statements are forward-looking statements that involve various risks and uncertainties. These forward-looking statements include, but are not limited to, statements with respect to mining and processing of mined ore, achieving projected recovery rates, anticipated production rates and mine life, operating efficiencies, costs and expenditures, changes in mineral resources and conversion of mineral resources to proven and probable reserves, and other information that is based on forecasts of future operational or financial results, estimates of amounts not yet determinable and assumptions of management.
Exploration results that include geophysics, sampling and drill results on wide spacings may not be indicative of the occurrence of a mineral deposit. Such results do not provide assurance that further work will establish sufficient grade, continuity, metallurgical characteristics and economic potential to be classified as a category of mineral resource. A mineral resource which is classified as “inferred” or indicated” has a great amount of uncertainty as to its existence and economic and legal feasibility. It cannot be assumed that any or part of an “indicated mineral resource” or “inferred mineral resource” will ever be upgraded to a higher category of resource. Investors are cautioned not to assume that all or any part of mineral deposits in these categories will ever be converted into proven and probable reserves.
Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as “expects” or does not expect”, “is expected”, anticipates” or “does not anticipate” “plans”, “estimates” or “intends” or stating that certain actions, events or results ” may”, “could”, “would”, “might” or “will” be taken, occur or be achieved) are not statements of historical fact and may be “forward-looking statements”. Forward-looking statements are subject to a variety of risks and uncertainties which could cause actual events or results to materially differ from those reflected in the forward-looking statements.
Actual results may differ materially from results contemplated by the forward-looking statements. Important factors that could differ materially from the Company’s expectations include, among others, risks related to international operations, unsuccessful exploration results, conclusions of economic evaluations and changes in project parameters as plans continue to be refined as well as changes in metal prices, changes in the availability of funding for mineral exploration and development, unanticipated changes in key management personnel and general economic conditions. When relying on forward-looking statements to make decisions, investors and others should carefully consider the foregoing factors and other uncertainties and should not place undue reliance on such forward-looking statements. The Company does not undertake to update any forward-looking statements, oral or written, made by itself or on its behalf. Accordingly, readers should not place undue reliance on forward-looking statements.
