Provides 2017
Outlook
Montreal, Quebec,
February 1, 2017- SEMAFO Inc. (TSX, OMX: SMF) reports full-year
2016 production results of 240,200 ounces at a total cash cost of
$548 and all-in sustaining cost of $720 per ounce at its Mana Mine.
As a result, the Corporation has met its production guidance for
the ninth consecutive year.
Highlights
-
In the fourth quarter, Mana produced 55,100
ounces of gold at a total cash cost1 of $571 per
ounce and all-in sustaining cost2 of $694 per
ounce
-
Annual production of 240,200 ounces, above the
midpoint of our 2016 guidance of 225,000 to 245,000 ounces
-
Total cash cost1 for 2016
reached $548 per ounce
-
All-in sustaining cost2 for 2016 of
$720 per ounce, at the low end of our guidance of between $720 and
$760 per ounce
-
Development capital expenditures of $11 million
in the year, representing stripping costs at Wona North and
purchase of mining equipment
-
Cash and cash equivalents of $274 million as at
December 31, 2016
-
Gold sales of 240,600 ounces of gold, resulting
in annual revenues of $300 million
1 Total cash
cost is a non-IFRS financial performance measure with no standard
definition under IFRS and represents the mining operation expenses
and government royalties per ounce sold.
2 All-in
sustaining cost is a non-IFRS financial performance measure with no
standard definition under IFRS and represents the total cash cost,
plus sustainable capital expenditures and stripping costs per
ounce.
Natougou
-
Development continues on track with $17 million
of the $219-million total budget spent at year-end 2016
-
Following commencement of construction, first
gold pour is scheduled for the second half of 2018
-
Detailed design and engineering 70% complete at
end of January 2017
-
Receipt of mining permit for Natougou
Mining
Operations
Mana, Burkina Faso
|
|
|
Three-month period
ended December 31, |
Year ended
December 31, |
|
|
|
2016 |
2015 |
Variation |
2016 |
2015 |
Variation |
Operating
Data |
|
|
|
|
|
|
|
Ore processed (tonnes) |
|
714,200 |
642,600 |
11% |
2,753,300 |
2,399,100 |
15% |
Head grade (g/t) |
|
2.52 |
3.13 |
(19%) |
2.88 |
3.63 |
(21%) |
Recovery (%) |
|
95 |
89 |
7% |
94 |
91 |
3% |
Gold ounces produced |
|
55,100 |
57,500 |
(4%) |
240,200 |
255,900 |
(6%) |
Gold ounces sold |
|
57,100 |
65,500 |
(13%) |
240,600 |
258,600 |
(7%) |
|
|
|
|
|
|
In 2016, the ore processed
increased and the head grade decreased compared to 2015. The lower
head grade results from a decision to add 425,000 tonnes of low
grade material at an average of 0.79 g/t Au to the mix during the
year. Absent the impact of this decision, the head grade for the
year would have been 3.26 g/t Au.
2016 numbers are preliminary and
are subject to final adjustment. All amounts are in US
dollars unless otherwise indicated.
2017
Outlook
Mana |
2017 Guidance |
Gold production ('000 oz) |
215 - 235 |
Total cash cost ($/oz) |
585 - 615 |
All-in sustaining cost ($/oz) |
795 - 835 |
|
|
Capital Expenditures and
Exploration
(in millions of $) |
|
Sustaining - Mana |
12 |
Stripping - Mana |
34 |
|
46 |
|
|
Initial exploration budget |
23 |
The general and administrative
expense for 2017 has been forecast at $14 million.
A number of assumptions were made
in preparing the 2017 guidance, including
-
Price of gold: $1,150 US
dollars per ounce
-
Price of fuel: $0.98 US
dollars per litre
-
Exchange rate: $0.74 US dollars to the Canadian
dollar
-
Exchange rate: $1.06 US dollars to the
Euro
In 2017, the Mana mill should
process approximately 2.4 million tonnes at an average grade of
3.21 g/t Au, with an average gold recovery rate of 91%. A
total of 1.9 million tonnes of ore will be extracted from the Siou,
Fofina and Wona North pits at an average grade of 3.82 g/t Au, with
the remaining balance sourced from low-grade material. As
previously guided, the Fofina deposit is expected to be depleted in
the first half of 2017
Update on
Natougou
In December, the Corporation was
awarded the mining permit for the Natougou Project. Construction is
now underway with the mobilization of contractors on site to begin
construction of earthworks and civil infrastructure. Compensation
has been paid to inhabitants in line with the resettlement action
plan, and award of contracts for resettlement of the village has
commenced.
Detailed design and engineering,
which has now reached the 70% completion stage, should be finished
at the beginning of the second quarter of 2017. At year-end 2016,
$17 million of the $219 million capital expenditures budget had
been spent.
2017
Exploration
Initial exploration expenditure
for 2017 has been set at $23 million, $15 million of which will be
spent at Natougou, $5 million at the Mana Project and the remaining
balance at other properties. At Mana, $1 million of the initial
budget will be used to test the underground potential at Siou.
The 2017 budget for Natougou
includes a provision of $8.5 million for an infill drill program
designed to convert current inferred resources on the West Flank
Zone into the indicated category and $1.3 million, which has been
earmarked for completing studies in order to evaluate a potential
underground operation. The remainder of the Natougou program
involves exploration drilling on both proximal and contiguous
permits to the Natougou deposit.
Fourth Quarter
and 2016 Conference Call
The 2016 fourth-quarter and
year-end financial results will be released before market-open on
March 8, 2017. Interested parties are invited to join the
conference call and webcast at 10.00 a.m. EST.
Tel. local & overseas: +1 (647) 788
4922
Tel. North America: 1 (877) 223 4471
Webcast: www.semafo.com
Replay number: 1 (800) 585 8367 or 1 (416) 621
4642
Replay pass code: 60539531
Replay expiration: March 29, 2017
About SEMAFO
SEMAFO is a Canadian-based mining company with gold production and
exploration activities in West Africa. The Corporation
operates the Mana Mine in Burkina Faso, which includes the
high-grade satellite deposits of Siou and Fofina, and is developing
the advanced gold deposit of Natougou. SEMAFO's strategic focus is
to maximize shareholder value by effectively managing its existing
assets as well as pursuing organic and strategic growth
opportunities.
CAUTION
CONCERNING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements.
Forward-looking statements involve known and unknown risks,
uncertainties and assumptions and accordingly, actual results and
future events could differ materially from those expressed or
implied in such statements. You are hence cautioned not to place
undue reliance on forward-looking statements. Forward-looking
statements include words or expressions such as "guidance",
"outlook", "continues, "on track", "scheduled", "preliminary",
"final adjustment", "forecast", "assumptions", "should", "will",
"expected", "initial", "designed to"," earmarked for", "in order
to", "potential", "pursuing", "growth", "opportunities" and other
similar words or expressions. Factors that could cause future
results or events to differ materially from current expectations
expressed or implied by the forward-looking statements include the
ability to achieve first gold pour at Natougou in the second half
of 2018, the ability to meet our 2017 production guidance of
between 215,000 and 235,000 ounces of gold at a total cash cost of
between $585 and $615 per ounce and all-in sustaining cost of
between $795 and $835 per ounce, the ability to incur $46 million
of capital expenditures at Mana in 2017, the ability to invest $23
million in our initial exploration program in 2017, the ability to
keep our general and administrative expenditures at $14 million,
the accuracy of our assumptions, the ability of the Mana mill to
process approximately 2.4 million tonnes at an average grade of
3.21 g/t Au with an average gold recovery rate of 91%, the ability
to extract a total of 1.9 million tonnes of ore from the Siou,
Fofina and Wona North pits at an average grade of 3.82 g/t Au, the
ability to finish Natougou's detailed design and engineering at the
beginning of the second quarter of 2017, the ability to convert
current inferred resources on Natougou's West Flank Zone into the
indicated category, the ability to execute on our strategic focus,
fluctuation in the price of currencies, gold or operating costs,
mining industry risks, uncertainty as to calculation of mineral
reserves and resources, delays, political and social stability in
Africa (including our ability to maintain or renew licenses and
permits) and other risks described in SEMAFO's documents filed with
Canadian securities regulatory authorities. You can find further
information with respect to these and other risks in SEMAFO's
2015 Annual MD&A, as updated in SEMAFO's 2016 First Quarter
MD&A, 2016 Second Quarter MD&A and 2016 Third Quarter
MD&A, and other filings made with Canadian securities
regulatory authorities and available at www.sedar.com. These
documents are also available on our website at www.semafo.com.
SEMAFO disclaims any obligation to update or revise these
forward-looking statements, except as required by applicable
law.
The information in this release is
subject to the disclosure requirements of SEMAFO under the
Swedish Securities Market Act and/or the
Swedish Financial Instruments Trading Act.
This information was publicly communicated on February 1, 2017 at
7:00 a.m., Eastern Standard Time.
For more information, contact
SEMAFO
Robert LaVallière
Vice-President, Corporate Affairs & Investor
Relations
Cell: +1 (514) 240 2780
Email: Robert.Lavalliere@semafo.com
Ruth Hanna
Analyst, Investor Relations
Email: Ruth.Hanna@semafo.com
Tel. local & overseas: +1 (514) 744 4408
North America Toll-Free: 1 (888) 744 4408
Website: www.semafo.com |
|
Press release (PDF)
This
announcement is distributed by Nasdaq Corporate Solutions on behalf
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The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: SEMAFO Inc. via Globenewswire
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