ALBUQUERQUE, N.M., May 10, 2012 (BUSINESS WIRE) — Santa Fe Gold Corporation is pleased to announce the financial results for the three and nine months ended March 31, 2012. Santa Fe reported record revenues of $8.1 million for the nine months ended March 31, representing a 97% increase over the same period of the prior fiscal year. The Company’s earnings from mining operations also grew significantly over the period to $3.9 million, a 110% increase over the comparable nine month period in 2011. Revenues for the three months ended March 31, 2012 increased by 27% to a record $3.7 million, while earnings from mining operations increased by 59% to $2.1 million. The full version of the financial statements and management’s discussion and analysis are available in the Company’s Form 10-Q filed with the SEC and available at www.sec.gov .
“We continue to increase production at our Summit silver-gold mine in New Mexico and recently announced commercial production effective the current quarter,” said Pierce Carson, CEO of Santa Fe. “Our record breaking third quarter is indicative of the Company’s commitment to achieve its objectives for fiscal 2012. We look forward to fiscal 2013 as an established and growing producer of silver and gold with even stronger operating results.”
2012 Third Quarter Highlights
— 110% increase in revenue to a record $3.7 million for the three months ended March 31, 2012.
— 59% increase in earnings from mining operations to $2.1 million for the three months ended March 31, 2012.
— 1,879% increase in EBITDA to $248,120 for the three months ended March 31, 2012.
— 97% increase in revenue to a record $8.1 million for the nine months ended March 31, 2012.
— 110% increase in earnings from mining operations to $3.9 million for the nine months ended March 31, 2012.
About Santa Fe Gold:
Santa Fe Gold is a U.S.-based mining and exploration enterprise focused on acquiring and developing gold, silver, copper and industrial mineral properties. Santa Fe controls: (i) the Summit mine and Lordsburg mill in southwestern New Mexico, which began processing operations in 2010; (ii) a substantial land position near the Lordsburg mill, comprising the core of the Lordsburg Mining District; (iii) the Ortiz gold property in north-central New Mexico; (iv) the Black Canyon mica deposit and processing equipment near Phoenix, Arizona; and (v) a deposit of micaceous iron oxide (MIO) in western Arizona. Santa Fe Gold intends to build a portfolio of high-quality, diversified mineral assets with an emphasis on precious metals.
To learn more about Santa Fe Gold, visit www.santafegoldcorp.com .
Cautionary Note Regarding Forward-Looking Statements:
This press release contains forward-looking statements and forward-looking information (collectively, “forward-looking statements”) within the meaning of applicable US and Canadian securities legislation. All statements, other than statements of historical fact, included herein are forward-looking statements. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward looking statements as a result of various factors, including, but not limited to, variations in the nature, quality and quantity of any mineral deposits that may be located, variations in the market price of any mineral products the Company may produce or plan to produce, the Company’s inability to obtain any necessary permits, consents or authorizations required for its activities, the Company’s inability to produce minerals from its properties successfully or profitably, to continue its projected growth, to raise the necessary capital or to be fully able to implement its business strategies, and other risks and uncertainties disclosed in the Company’s Annual Report on Form 10-K for the year ended June 30, 2011 and its most recent quarterly reports filed with the United States Securities and Exchange Commission (the “SEC”), and other information released by the Company and filed with the appropriate regulatory agencies. All of the Company’s US public disclosure filings may be accessed via www.sec.gov and its Canadian public disclosure filings may be accessed via www.sedar.com , and readers are urged to review these materials.
See Accompanying Tables
The following information summarizes the financial condition of Santa Fe Gold Corporation at March 31, 2012, including its balance sheets at March 31, 2012 and June 30, 2011, respectively, its results of operations for the three months and nine months ended March 31, 2012 and 2011, respectively, and its cash flows for the nine months ended March 31, 2012 and 2011. The summary data for the three and nine months ended March 31, 2012 and 2011, respectively, are unaudited; the summary data for the financial year ended June 30, 2011 are taken from our audited financial statements contained in our annual report on Form 10-K for the financial year ended June 30, 2011, 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 .
SANTA FE GOLD CORPORATION
CONSOLIDATED BALANCE SHEETS
March 31, June 30,
ASSETS 2012 2011
———– ———–
(Unaudited)
CURRENT ASSETS:
Cash and cash equivalents $ 597,871 $ 172,531
Accounts receivable 2,649,654 2,230,605
Inventory 140,970 175,578
Marketable securities 190,642 97,260
Prepaid expenses and other current assets 1,356,022 279,064
Note receivable and accrued interest 209,533 –
———– ———–
Total Current Assets 5,144,692 2,955,038
———– ———–
MINERAL PROPERTIES 579,000 579,000
———– ———–
PROPERTY, PLANT AND EQUIPMENT, 12,403,235 13,104,215
net of depreciation of
$4,994,932 and $3,090,516, respectively
———– ———–
OTHER ASSETS:
Construction in process 12,577,447 8,427,113
Idle equipment, net 1,223,528 1,223,528
Note receivable and accrued interest – 203,422
Restricted cash 230,716 410,374
Deferred financing costs 479,307 314,700
———– ———–
Total Other Assets 14,510,998 10,579,137
———– ———–
Total Assets $ 32,637,925 $ 27,217,390
==== =========== ==== ===========
LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)
CURRENT LIABILITIES:
Accounts payable $ 1,200,052 $ 1,090,907
Accrued liabilities 1,729,125 1,976,751
Derivative instrument liabilities 3,495,452 8,973,066
Current portion, notes payable, net of discount of $410,316 and 6,641,766 78,384
$-0-, respectively
Current portion, capital leases 40,877 83,856
Senior subordinated convertible notes payable, net of discount of 440,748 –
$9,252 and $-0-, respectively
Deferred revenue 2,855,824 3,611,266
Accrued interest payable 10,063 255,109
———– ———–
Total Current Liabilities 16,413,907 16,069,339
LONG TERM LIABILITIES:
Notes payable, net discount of $50,479 and $-0-, respectively 3,006,335 58,957
Capital leases, net of current portion 14,162 45,057
Senior secured convertible notes payable, net of discount of $-0- – 11,001,935
and $2,498,065, respectively
Senior subordinated convertible notes payable, net of discount of – 430,316
$-0- and $19,684, respectively
Asset retirement obligation 155,363 149,236
———– ———–
Total Liabilities 19,589,767 27,754,840
———– ———–
STOCKHOLDERS’ EQUITY (DEFICIT):
Common stock, $.002 par value, 300,000,000 shares authorized; 217,525 188,341
109,000,030 and 94,744,412 shares issued and outstanding,
respectively; Includes non-vested granted shares of 237,500 and
575,000, respectively
Additional paid in capital 73,759,989 59,021,550
Accumulated (deficit) (61,021,940) (59,746,543)
Accumulated other comprehensive income (loss) 92,584 (798)
———– ———–
Total Stockholders’ Equity (Deficit) 13,048,158 (537,450)
———– ———–
Total Liabilities and Stockholders’ Equity (Deficit) $ 32,637,925 $ 27,217,390
==== =========== ==== ===========
SANTA FE GOLD CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
AND COMPREHENSIVE INCOME (LOSS)
(Unaudited)
Three Months Ended Nine Months Ended
March 31, March 31,
——————————– ——————————-
2012 2011 2012 2011
———– ———- ———- ———-
SALES $ 3,675,293 $ 2,894,007 $ 8,144,512 $ 4,144,269
— ———– — ———- — ———- — ———-
OPERATING COSTS AND EXPENSES:
Costs applicable to sales 1,623,592 1,604,449 4,276,570 2,303,871
Exploration, mine and mill start up costs 1,001,225 597,266 2,243,246 1,669,663
General and administrative 802,356 679,757 2,494,516 2,171,297
Depreciation and amortization 668,454 577,857 1,985,173 1,725,858
Accretion of asset retirement obligation – – 6,127 –
———– ———- ———- ———-
Total Operating Costs and Expenses 4,095,627 3,459,329 11,005,632 7,870,689
———– ———- ———- ———-
LOSS FROM OPERATIONS (420,334) (565,322) (2,861,120) (3,726,420)
———– ———- ———- ———-
OTHER INCOME (EXPENSE):
(Loss) on disposal of assets – – (152,587) –
Interest income 2,662 2,750 7,747 9,188
Miscellaneous income – 2,485 5,328 14
Gain (loss) on derivative instrument liabilities 1,301,722 4,425,628 4,099,846 (898,934)
Accretion of discounts on notes payable (108,673) (322,782) (1,447,358) (931,939)
Interest expense (239,300) (180,457) (927,253) (551,791)
———– ———- ———- ———-
Total Other Income (Expense) 956,411 3,927,624 1,585,723 (2,373,462)
———– ———- ———- ———-
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES 536,077 3,362,302 (1,275,397) (6,099,882)
PROVISION FOR INCOME TAXES – – – –
———– ———- ———- ———-
NET INCOME (LOSS) 536,077 3,362,302 (1,275,397) (6,099,882)
OTHER COMPREHENSIVE INCOME (LOSS)
Unrealized gain (loss) on marketable securities 14,401 (25,102) 93,382 66,840
———– ———- ———- ———-
COMPREHENSIVE INCOME (LOSS) $ 550,478 $ 3,337,200 $ (1,182,015) $ (6,033,042)
== =========== === ========== == ========== === ==========
Basic and Diluted Per Share data
Net Earnings (Loss) – basic and diluted $ 0.00 $ 0.04 $ (0.01) $ (0.07)
== =========== === ========== == ========== === ==========
Weighted Average Common Shares Outstanding:
Basic and diluted 108,675,592 94,126,551 99,670,730 92,943,423
=========== ========== ========== ==========
SANTA FE GOLD CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
March 31,
——————————–
2012 2011
———- ———-
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (1,275,397) $ (6,099,882)
Adjustments to reconcile net loss to net cash used in operating
activities:
Depreciation 1,985,173 1,725,858
Stock-based compensation 635,199 864,965
Accretion of discount on notes payable 1,447,358 931,939
Accretion of asset retirement obligation 6,127 –
(Gain) loss on derivative instrument liabilities (4,099,846) 898,934
Loss on disposal of assets 152,587 –
Amortization of deferred financing costs 360,393 73,738
Net change in operating assets and liabilities:
Accounts receivable (419,049) (2,783,632)
Inventory 34,608 –
Prepaid expenses and other current assets (1,076,958) (109,951)
Accounts payable and accrued liabilities (138,481) 1,649,185
Deferred revenue (755,442) (195,326)
Accrued interest payable (245,046) 209,104
———- ———-
Net Cash Used in Operating Activities (3,388,774) (2,835,068)
———- ———-
CASH FLOWS FROM INVESTING ACTIVITIES:
Decrease to restricted cash 179,658 –
Proceeds from disposal of assets 25,000 –
Purchase of marketable securities – (98,058)
Notes receivable and accrued interest (6,111) (201,400)
Purchase of property, plant and equipment (1,461,780) (862,720)
Construction in progress (4,150,334) (2,737,147)
———- ———-
Net Cash Used in Investing Activities (5,413,567) (3,899,325)
———- ———-
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of stock 700,000 2,000,001
Proceeds from notes payable 15,105,120 77,306
Payments on notes payable (5,133,565) (170,400)
Payments on capital leases (73,874) (103,013)
Payment of private placement fees – (136,000)
Payment of financing costs (1,370,000) –
———- ———-
Net Cash Provided by Financing Activities 9,227,681 1,667,894
———- ———-
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 425,340 (5,066,499)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 172,531 5,540,130
———- ———-
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 597,871 $ 473,631
=== ========== === ==========
SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest (Includes $153,965 capitalized interest) $ 1,319,807 $ 558,331
=== ========== === ==========
Cash paid for income taxes $ – $ –
=== ========== === ==========
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING
ACTIVITIES:
Stock issued for services $ 48,000 $ 16,550
Issuance of common stock for conversion of convertible notes payable $ 13,432,424 $ –
=== ========== === ==========
SOURCE: Santa Fe Gold Corporation
Santa Fe Gold Corporation
Pierce Carson, President and Chief Executive Officer
505-255-4852
or
Investor Relations:
Torrey Hills Capital
Clay Chase
858-456-7300
[email protected]
