28th Aug 2009 07:00
Minera IRL Limited
("Minera" or "the Company")
Interim Results for the six month period ended 30 June 2009
London, 28 August, 2009 Minera IRL Ltd (AIM: MIRL), the South American mining company, is pleased to announce its interim results for the six months ended 30 June 2009.
Highlights in the year to date:
Gold produced to 30 June 2009 was14,903 ounces
Sales revenue US$13.3 million
Corihuarmi cash operating cost was $388 per ounce
EBITDA was $4.1 million
Profit before tax US$1.2 million, after tax US$0.5 million
Cash balance of US$5 million at 30 June 2009 after repayment of US$2.5 million of bank loans
New equity fund raising US$14.2 million increases cash to US$19 million at end of July 2009
New Life-of-Mine plan extended mine life at Corihuarmi
Drilling continued to define the new gold discovery at the Ollachea Project
New project at La Falda, Chile
Executive Chairman Courtney Chamberlain commented: "We are satisfied with the half yearly results and the progress we have made. Gold sales of US$13.3 million were on the back of a continuing strong gold price where our spot sales averaged US$917 per ounce for the period. Gross profit was US$4.2 million, EBITDA US$4.1 million, profit before tax US$1.2 million and profit after tax US$0.5 million.
A major fund raising, which netted us US$14.2 million was completed in July, bringing our cash balance to approximately $19 million. This places us in a strong position to grow through both our own projects and corporate opportunities.
Our Corihuarmi Gold Mine continues to perform well with cash operating costs below $400 per ounce providing the cash flow needed to support our basic corporate business plan. This was achieved in spite of the anticipated reduced production as mining moved to the lower grade Susan deposit.
I am very pleased with the progress that we continue to make and anticipate a number of new initiatives coming to fruition in coming months."
For more information contact:
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Minera IRL Courtney Chamberlain, Executive Chairman Trish Kent, Vice President, Corporate Relations |
+511 4181230 |
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Arbuthnot Securities (Nominated Adviser & Broker, London) |
+ 44 (0)20 7012 2000 |
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John Prior Edward Burbidge |
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Fox-Davies Capital |
+ 44 (0)20 7936 5200 |
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David Poraj-Wilczynski Jason Bahnsen |
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Bankside Consultants (Financial PR, London) |
+ 44 (0)20 7367 8888 |
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Simon Rothschild |
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Louise Mason |
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Synergy Asociados (Public Relations, Lima) |
+ 511 628 6300 |
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Magaly Villena |
+ 511 99855 2232 |
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Minera IRL Limited ("MIRL") is the AIM and Lima, Peru listed holding company of precious metals mining and exploration companies focused in Latin America. MIRL is led by an experienced senior management team with extensive industry experience, particularly in operating in South America. The Group operates the Corihuarmi Gold Mine and the emerging Ollachea Gold Project in Peru.
www.minera-irl.com
Chairman's Statement
The first half of 2009 has been another good period for Minera IRL with progress on many fronts placing your Company in an ever stronger position to grow and prosper.
The financial performance of Minera IRL for the first half was in line with our expectations. On the back of gold sales of US$13.3 million, we generated a gross profit of US$4.2 million, an EBITDA of US$4.1 million, a profit before tax of US$1.2 million and an after tax profit of US$0.5 million. Cash at 30 June 2009 was US$5.1 million despite the repayment of US$2.5 million of bank loans during the period.
Whilst Corihuarmi continues to admirably support our corporate business plan, production is not sufficient to fund our ambitious growth aspirations. Due to the growing importance of our Ollachea Project and upcoming demands of new projects, we undertook an equity raising which netted the Company US$14.2 million. This brought us to a very strong cash position of approximately US$19 million at the end of July.
Following an exceptional inaugural year, our Corihuarmi Gold Mine has settled into a consistent operation managed by an excellent team supported by a dedicated workforce. A major effort was the successful transition of mining to the Susan outcrop which included the difficult establishment of access and the removal of an overlying waste capping. As expected, grade was lower than from the Diana ore zone mined in 2008 but production of 14,903 ounces for the 6 months was on target for achieving over 30,000 ounces for the year. The average spot price obtained from sales was US$917 per ounce, a good margin over the cash operating cost of US$388 per ounce.
A new Corihuarmi Life-of-Mine Plan was completed during the period. The gold added to reserves more than offset depletion in 2008 resulting in the mine life being extended until mid 2013. The pending inclusion of other resources is expected to further add to mine life. The acquisition of a core exploration licence at Bethania, only 10km from Corihuarmi, provides immediate drill targets which has the potential to add further reserves to the mine.
Much progress has been made at our Ollachea Project which has emerged as a significant new gold discovery. At the time of writing over 19,000 meters has been drilled and 55 holes completed. The major focus has been to drill the Minapampa Zone, where the strike length has been extended to over 600 meters, in order to establish an Inferred Resource which will form the foundations for a Scoping Study which has recently been commissioned. The results of this study will be released later in the year. A third drill rig was added to the program in early August and this has commenced further exploration of the broader mineralized package of rocks.
In March, a Letter-of-Intent was signed with Catalina Resources on the La Falda Project in the Maricunga District of Chile. It is expected that this will be converted into a Definitive Agreement and Management Contract very soon. Minera IRL will have the right to earn a 75% equity. La Falda represents an early stage, but high quality, large gold porphyry exploration target supported by good surface samples and an excellent geophysical signature. Drilling with 2 rigs is planned as soon as the winter weather abates, probably in early October.
Gold price has continued strong in 2009, above US$900 per ounce, and, whilst somewhat volatile, has not shown the wide fluctuations of 2008. We are of the view that gold price will remain solid and have no plans to deviate from our policy of spot gold sales.
Peru remains a very attractive country for mining. The economy remains strong and Peru is the only country in Latin America that experienced a positive growth rate in the first half of 2009. The geology is excellent with the potential for many more discoveries. Peru has an excellent mining culture and sound mining law. We continue to build our reputation and cement our sound working relationship with the mining authorities. We greatly appreciate the assistance and support these government departments have given us.
Our success would not have been possible without our experienced Board of Directors and our excellent management team. Terry Streeter resigned from the Board on 15 July after 4 years of dedicated contributions as a Director as well as financial support, and I wish to extend my very special appreciation to Terry. I also wish to thank our ever growing list of shareholders for their ongoing support. I never lose sight of the fact that our shareholders are the owners of Minera IRL and all of our efforts in growing the Company are on their behalf.
Courtney Chamberlain
Executive Chairman
Minera IRL Limited
27 August 2009
Minera IRL Limited
Consolidated Income Statement
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6 months ended 30 June 2009 (unaudited) US$'000 |
6 months ended 30 June 2008 (unaudited) US$'000 |
Year ended
31 December
2008
(audited)
US$’000 |
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Revenue |
13,318 |
16,625 |
43,568 |
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Cost of sales |
(9,070) |
(5,905) |
(17,344) |
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Gross profit |
4,248 |
10,720 |
26,224 |
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Administration expenses |
(2,247) |
(2,350) |
(8,447) |
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Exploration costs written off |
(415) |
(489) |
(2,185) |
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Operating profit |
1,586 |
7,881 |
15,592 |
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Financial income |
19 |
29 |
151 |
|||
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Financial expenses |
(415) |
(120) |
(657) |
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Net financial income/(expense) |
(396) |
(91) |
(506) |
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Profit before tax |
1,190 |
7,790 |
15,086 |
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Income tax |
(663) |
- |
(2,563) |
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Profit for the period |
527 |
7,790 |
12,523 |
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Earnings per ordinary share (US cents) |
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Basic |
0.9 |
12.6 |
20.2 |
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Diluted |
0.9 |
10.8 |
18.0 |
Minera IRL Limited
Consolidated Balance Sheet
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As at 30 June 2009 (unaudited) US$'000 |
As at 30 June 2008 (unaudited) US$'000 |
As at 31 December 2008 (audited) US$'000 |
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Assets |
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Property, plant and equipment |
24,720 |
24,761 |
26,249 |
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Intangible assets |
14,710 |
7,227 |
10,504 |
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Trade and other receivables |
- |
5 |
- |
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Total non-current assets |
39,430 |
31,993 |
36,753 |
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Other receivables and prepayments |
4,965 |
8,964 |
8,170 |
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Inventory |
936 |
420 |
773 |
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Cash and cash equivalents |
5,141 |
6,590 |
8,992 |
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Total current assets |
11,042 |
15,974 |
17,935 |
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Total assets |
50,472 |
47,967 |
54,688 |
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Equity |
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Share capital |
41,459 |
41,459 |
41,459 |
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Foreign currency reserve |
129 |
129 |
129 |
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Share option reserve |
1,259 |
971 |
1,173 |
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Profit and loss account |
(5,844) |
(11,104) |
(6,371) |
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Total equity |
37,003 |
31,455 |
36,390 |
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Liabilities |
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Interest bearing loans |
- |
6,000 |
- |
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Provisions |
1,349 |
1,700 |
1,235 |
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Other long term liabilities |
3,212 |
3,780 |
3,081 |
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Total non-current liabilities |
4,561 |
11,480 |
4,316 |
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Interest bearing loans |
3,500 |
- |
6,000 |
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Trade and other payables |
5,408 |
5,032 |
7,982 |
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Total current liabilities |
8,908 |
5,032 |
13,982 |
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Total liabilities |
13,469 |
16,512 |
18,298 |
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Total equity and liabilities |
50,472 |
47,967 |
54,688 |
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Minera IRL Limited
Consolidated Statement of Changes in Equity
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Share capital US$'000 |
Foreign currency reserve US$'000 |
Share Option reserve US$'000 |
Profit and loss account US$'000 |
Total US$'000 |
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Balance 1 January 2008 |
41,423 |
129 |
543 |
(18,894) |
23,201 |
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Issue of share capital |
36 |
- |
- |
- |
36 |
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Profit for the period to 30 June 2008 |
- |
- |
- |
7,790 |
7,790 |
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Reserve for share option costs |
- |
- |
428 |
- |
428 |
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Balance 30 June 2008 |
41,459 |
129 |
971 |
(11,104) |
31,455 |
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Balance 1 July 2008 |
41,459 |
129 |
971 |
(11,104) |
31,455 |
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Profit for the period to 31 December 2008 |
- |
- |
- |
4,733 |
4,733 |
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Reserve for share option costs |
- |
- |
202 |
- |
202 |
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Balance 31 December 2008 |
41,459 |
129 |
1,173 |
(6,371) |
36,390 |
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Balance 1 January 2009 |
41,459 |
129 |
1,173 |
(6,371) |
36,390 |
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Profit for the period to 30 June 2009 |
- |
- |
- |
527 |
527 |
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Reserve for share option Costs |
- |
- |
86 |
- |
86 |
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Balance 30 June 2009 |
41,459 |
129 |
1,259 |
(5,844) |
37,003 |
Minera IRL Limited
Consolidated Cash Flow Statement
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6 months ended 30 June 2009 (unaudited) US$'000 |
6 months ended 30 June 2008 (unaudited) US$'000 |
Year Ended 31 December 2008 (audited) US$'000 |
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Cash flows from operating activities |
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Operating profit |
1,586 |
7,881 |
15,592 |
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Depreciation |
2,504 |
2,162 |
5,394 |
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Impairment of exploration assets |
112 |
- |
51 |
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Provision for share option costs |
86 |
428 |
630 |
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Provision for mine closure costs |
114 |
- |
233 |
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Loss on disposals of assets |
- |
- |
64 |
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Increase in inventory |
(163) |
(392) |
(745) |
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Decrease/(increase) in other receivables and prepayments |
3,205 |
(5,419) |
(4,620) |
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(Decrease)/increase in trade and other payables |
(1,037) |
1,034 |
1,289 |
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Corporation tax paid |
(2,200) |
- |
(887) |
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Net cash flow from operations |
4,207 |
5,694 |
17,001 |
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Interest received |
19 |
29 |
151 |
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Interest paid |
(284) |
(120) |
(337) |
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Net cash flow from operating activities |
3,942 |
5,603 |
16,815 |
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Cash flows from investing activities |
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Acquisition of property, plant and equipment |
(975) |
(6,106) |
(11,588) |
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Acquisition of intangible assets (exploration expenditure) |
(4,318) |
(1,184) |
(4,512) |
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Net cash outflow from investing activities |
(5,293) |
(7,290) |
(16,100) |
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Cash flows from financing activities |
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Proceeds from the issue of ordinary share capital |
- |
36 |
36 |
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Receipt/(repayment) of loans |
(2,500) |
3,000 |
3,000 |
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Net cash inflow/(outflow) from financing activities |
(2,500) |
3,036 |
3,036 |
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Net increase/(decrease) in cash and cash equivalents |
(3,851) |
1,349 |
3,751 |
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Cash and cash equivalents at beginning of the period |
8,992 |
5,241 |
5,241 |
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Cash and cash equivalents at end of the period |
5,141 |
6,590 |
8,992 |
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Notes to the Interim Report |
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The financial information contained in this Interim Report does not constitute statutory accounts as defined by the Companies (Jersey) Law 1991. No statutory accounts for the period have been delivered to the Jersey Registrar of Companies. The financial information contained in this Interim Report has neither been audited nor reviewed by the auditors. |
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The statutory accounts for the year ended 31 December 2008 have been filed with the Jersey Registrar of Companies. The auditors' report on these accounts was unqualified. The consolidated financial information contained in this Interim Report has been presented and prepared in a form consistent with the annual accounts and in accordance with accounting policies and standards applicable to those annual accounts. |
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This Interim Report has been approved for issue by the Board of Directors on 27 August 2009 |
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Profit per share |
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The profit per share has been calculated using the profit attributable to ordinary shareholders of US$527,000 (2008: US$ 7,790,000) and the weighted average number of ordinary shares in issue during the period to 30 June 2009 of 61,883,422 (2008: 61,857,086). |
Related Shares:
MIRL.L