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TORONTO, Feb. 14 2019 (GLOBE NEWSWIRE) – YAMANA GOLD INC. ("TSX: YRI; NYSE: AUY)" ("Yamana" or "the Company") presents herein its fourth quarter financial and operating results. year 2018 and its estimates of reserves and mineral resources as at December 31, 2018.
FOURTH QUARTER HIGHLIGHTS
Equivalent of gold ("GEO")(1) production of Yamana Mines(2) for the fourth quarter was 310,369, of which 270,193 ounces of gold and 3.26 million ounces of silver. Total gold production of Yamana(3) was 292,484 ounces. The company also produced 39.0 million pounds of copper.
Total GEO production for the year from Yamana Mines was 1,041,350, including 940,619 ounces of gold and 8.02 million ounces of silver. Copper production for the year is 129.2 million pounds.
Yamana Mines' gold and copper production for the full year exceeded the higher targets set in October of last year, while silver production for the year exceeded the lower guidance provided for the year. that time. The initial forecast for February 2018 was 900,000 ounces of gold, 120 million pounds of copper and 8.15 million ounces of silver.
Fourth quarter costs for Yamana Mines included all-in sustaining costs ("AISC") for each product.(4) $ 656 per GEO; cash costs per product(4) $ 418 per GEO; and total cost of sales of US $ 1,019 by GEO. Full-year Yamana mining costs include AISC in the form of derivatives(4) $ 699 per GEO; cash costs per product(4) $ 448 per GEO; and the total cost of sales of US $ 1,028 by GEO, which is at or above the indicative ranges for the cost metric. Refer to page 18 of this press release for more information on metal costs, co-products and derivatives. In the future, cost indicators and reported cost projections will reflect a change in presentation methodology. Specifically, the company, as an active member of the World Gold Council, has adopted the updated version of the IACS Guidance Note, which is described in detail in Section 2 of the MD & A. fourth quarter of 2018, which was filed on SEDAR. In the company's 2019-2021 press release published on February 14, 2019, cost metrics for 2018 have been restated to reflect the updated methodology facilitating direct comparisons.
(All amounts are in United States dollars unless otherwise indicated.)
- The gold equivalent includes gold and silver in a ratio of 81.3: 1 for the fourth quarter of 2018 and 79.6: 1 for the whole of the year. Year 2018.
- The Yamana mines include Chapada, El Peñón, Canadian Malartic, Minera Florida, Jacobina and Cerro Moro.
- Yamana's total production includes the production of Gualcamayo.
- Refers to a non-GAAP financial measure, an extra item or subtotal in the financial statements. Please refer to the discussion at the end of this press release under the heading "Non-GAAP Financial Measures, Additional Items and Subtotals in the Financial Statements". Reconciliations of all non-GAAP financial measures are available at www.yamana.com/Q42018 and Section 11 of the Company's 2013 fourth quarter MD & A, filed on SEDAR. .
Adjusted result(4) for the three months ended December 31, 2018, excluding certain items (see below), amounted to $ 26.2 million, or $ 0.03 per share. The net loss attributable to Yamana shareholders for the same period was $ 61.4 million, or $ 0.06 per share, basic and diluted. This includes certain non-cash and other items that may not reflect current and ongoing activities, which reduced the Company's net earnings by $ 87.6 million or $ 0.09 per share. basic and diluted.
Cash flow from operating activities for the fourth quarter was $ 114.7 million and cash flow from operating activities before net change in working capital(4) $ 115.8 million. Fourth quarter cash flow does not include the amortization of deferred revenue, of which $ 33.3 million related to deferred revenue recognized attributable to deliveries made under the Company's early copper sales program during the period. quarterly. Deliveries under the company's advanced copper sales program began in the third quarter of 2018 and will continue through mid-2019. Without the timing difference of cash proceeds attributable to this transaction, the Company's cash flow from operating activities before net change in working capital would have been greater than these amounts during the quarter, as follows:
| (In millions of US dollars, unless otherwise indicated) | For the three months ended | |||||||||||
| Illustration of the impact of the advanced copper sales program | March 31, 2018 | June 30, 2018 | September 30 2018 |
December 31, 2018 | March 31, 2019(6) | June 30, 2019(6) | Cumulative impact | |||||
| Copper books to be delivered by contract (millions) | 13.2 | 10.7 | 8.2 | 8.2 | 40.3 | |||||||
| Cash flow from operating activities before net change in working capital (5) | $ | 206.4 | $ | 157.5 | $ | 86.6 | $ | 115.8 | n / A | n / A | ||
| Impact due to the advanced copper sales program | (125.0 | ) | – | 41.7 | 33.3 | 25.1 | 24.9 | – | ||||
| Cash flow from operating activities before net change in working capital, normalized for the copper advance sales program (5) | $ | 81.4 | $ | 157.5 | $ | 128.3 | $ | 149.1 | n / A | n / A | ||
- Refers to a non-GAAP financial measure, an extra item or subtotal in the financial statements. Please refer to the discussion at the end of this press release under the heading "Non-GAAP Financial Measures, Additional Items and Subtotals in the Financial Statements". Reconciliations of all non-GAAP financial measures are available at www.yamana.com/Q42018 and Section 11 of the Company's 2013 fourth quarter MD & A, filed on SEDAR. . Adjusted operating cash flow is adjusted for payments that do not reflect current period transactions and advance payments received under metal purchase agreements.
- For illustration purposes only; the company intends to provide information at each subsequent period reflecting the impact of the copper sales program over its duration.
A $ 150.0 million non-cash write-back of Jacobina was recorded as a result of the significant increase in reserves and mineral resources, which extends the life of the mine, as well as other operational improvements. The reversal was offset by $ 151.0 million of non – cash impairment charges in respect of Minera Florida and $ 45.0 million related to the acquisition gap related to the acquisition. 39, acquisition of Canadian Malartic. No indicators of impairment or recovery have been identified for other active mining sites. In addition, the current quarter includes an income tax expense of $ 33.3 million incurred and payable at the end of the year as a result of an administrative interpretation of the relevant tax legislation and approach taken. by the Brazilian tax authorities under this tax legislation in December. The expense was unforeseen, inconsistent with the company's tax law interpretations and inconsistent with past practice. The Company has made the payment in such a way as to avoid penalties and interest, but in respect of which it is pursuing legal remedies. The adjustments to net income during the periods indicated below are as follows:
Summary of certain non-cash and other items included in net loss
| Three months ending December 31 | Twelve months ending December 31 | |||||||
| 2018 | 2017 | 2018 | 2017 | |||||
| Unrealized foreign exchange losses / (gains) | 3.2 | (1.2 | ) | 9.5 | 15.0 | |||
| Share-based payments / mark-to-market of deferred share units | (0.5 | ) | 3.7 | 5.3 | 12.8 | |||
| Market value losses (gains) on derivative contracts | (2.6 | ) | 12.8 | (9.4 | ) | 9.3 | ||
| Net market value losses (gains) on investments and other badets | 0.9 | (0.5 | ) | 9.8 | 2.5 | |||
| Revision of estimates and liabilities, including contingencies | 0.3 | 1.9 | 12.9 | (26.6 | ) | |||
| Gain on sale of subsidiaries | (2.7 | ) | – | (73.7 | ) | – | ||
| Depreciation (reversal) of mining and non-operating mineral properties and properties held for sale | (13.0 | ) | 356.4 | 250.0 | 356.5 | |||
| Impairment of goodwill | 45.0 | – | 45.0 | – | ||||
| Financing fees paid upon early redemption of the Notes | – | – | 14.7 | – | ||||
| Reorganization costs | 2.2 | 1.2 | 10.1 | 4.8 | ||||
| Other provisions, write-downs and adjustments | 16.4 | (0.5 | ) | 34.9 | 18.5 | |||
| Unrealized foreign exchange losses / (gains) based on non-cash tax | (43.2 | ) | 11.6 | 151.9 | 9.9 | |||
| Effect of Adjustments and Other Single Tax Adjustments on Income Tax | 81.6 | (141.3 | ) | (64.4 | ) | (143.4 | ) | |
| TOTAL ADJUSTMENTS(7) | 87.6 | 244.1 | 396.5 | 259.3 | ||||
| Increase in net loss per share | 0.09 | 0.26 | 0.42 | 0.27 | ||||
- For the three months ended December 31, 2018, the net operating loss attributable to Yamana shareholders would be adjusted based on an increase of $ 87.6 million (2017 – $ 244.1 million). ). For the twelve-month period ended December 31, 2018, net operating income, attributable to Yamana shareholders, would be adjusted based on an increase of $ 396.5 million ($ 259.3 million). dollars in 2017).
In the fourth quarter of 2018, the Company finalized the previously announced sale of the Gualcamayo mine in Argentina to Mineros SA The Company received a consideration totaling approximately $ 85 million, which includes a cash proceeds of $ 30 million; $ 30 million in additional payments related to the Deep Carbonates project; and royalties related to the production of metals in Gualcamayo and the Deep Carbonates project. The consideration received offers considerable benefits in the case of new oxide discoveries, increased gold prices and / or Deep Carbonates project development, thereby preserving a considerable potential. The transaction also includes an option for Mineros to acquire up to 51% of the La Pepa project in Chile.
The Company's exploration programs continue to provide discoveries in mineral resources as well as the replacement and growth of mineral reserves. The exploration program has been successful in increasing gold mineral reserves to replace mineral depletion in 2018, excluding badets disposed of in 2018. On the same basis, measured and indicated gold mineral resources and Inferred Mineral Resources increased by 5% and 7%, respectively. For silver, mineral reserves decreased by 3%, measured and indicated mineral resources decreased by 4% and inferred mineral resources decreased by 3%. For copper, mineral reserves increased by 6%, measured and indicated mineral resources by 55% and inferred mineral resources by 211%.
The balance sheet as at December 31, 2018 includes cash and cash equivalents of $ 98.5 million, with an available credit of $ 705.0 million for total liquidity of $ 803.5 million. Net debt(4) as at December 31, 2018, was $ 1.66 billion.
Daniel Racine, President and Chief Executive Officer of Yamana, said, "In 2018, we again exceeded our production target for all metals and at or above cost. Gold and copper exceeded the higher forecast we had announced in October, while silver production exceeded the forecast lowered at that time. Our operational performance would not have been possible without our success: we managed to meet the deadlines and the budget allocated to Cerro Moro and to exceed the expectations in terms of production and costs during the first six months of production commercial.
During the year, we also advanced several strategic initiatives, including the closing of the sale of the Canadian Malartic exploration properties, the Gualcamayo mine, as well as the finalization of the business combination between Brio Gold and Leagold, in addition to ongoing evaluation and participation in the scenario discussions to be developed. Agua Rica.
Overall, we remain well positioned to maintain the company's health, safety, operating and balance sheet momentum in 2019. "
DEVELOPMENT, OPTIMIZATION AND STRATEGIC INITIATIVES
Chapada: The Company continues to advance its exploration program in order to identify the richer copper and gold deposits near the Chapada mine, to drill in-grade deposits in the Sucupira and Baru deposits that would lead to an expansion the pit and advance targets at the district level. Mineralization has been identified with a trend of 15 km and many potential areas are under study for future drilling. Infill drilling in the Baru area is expected to reduce the deposit ratios of the Sucupira deposit, and drilling on oxide mineralization, such as Hidrotermalito, has potential for heap leaching that could complement the Suruca Oxides project. Despite the focus on exploration potential to discover gold-bearing and higher-grade copper zones, the company has also advanced other projects that should further improve Chapada's mine yields.
To this end, the company has completed studies and evaluations of several development opportunities in Chapada and has embarked on a feasibility review of a three-phase plan in Chapada. These opportunities range from facility optimization initiatives to improve copper and gold recoveries, facility expansions to generate cash flow, and backflows from the sides of the trough to Expose the higher-grade areas. The study and badessments include design and third-party engineering, estimates of capital expenditures, production forecasts and operating costs.
Given the nature of the opportunities, projects can be considered alone or as part of a phased development plan. This flexible approach allows the company to balance the maximization of value at Chapada with the capital allocation to the entire portfolio of the company.
Phase 1 optimization work at the plant, with expected recovery improvements of around 2% for both metals, has been approved. Related capital expenditures are estimated at approximately $ 9 million. The company continues to prioritize the engineering of long lead time equipment for Phase 1, and in the fourth quarter the expansion of the flotation circuit continued as planned with the installation of six new cells. DFR flotation. Commissioning is scheduled for mid-2019.
Engineering work is underway for Phases 2 and 3, an expansion of the Chapada plant and the repression of the Chapada pit wall to expose Sucupira ores to higher grade, respectively. Although the review of these projects is currently under review, the Company does not anticipate allocating significant expansionary capital to these projects until 2021.
Based on work completed to date, the Company estimates that the phased plan will support an annual production of between 100,000 and 110,000 ounces of gold (excluding contributions to gold production from high-grade zones identified from Suruca, a gold-only orebody) and 150 to 160 million pounds of copper by at least 2034. This is an opportunity to generate cash flow increases and strong cash flow returns on invested capital and an increase in production prospects, as indicated in Chapada. NI 43-101 compliant technical report dated March 21, 2018. Further details of the project are expected to be available in mid-2019 with the completion of the feasibility study. A development decision for phase 2 is expected in 2020.
Suruca – Development opportunity for exclusively gold-bearing oxides and sulphides
In parallel with the phased plan for Chapada, the development of Suruca's oxide deposit, composed entirely of gold, continues to be evaluated as an autonomous heap leach operation for which an update is required. level of feasibility study has been completed. In addition, the Suruca Sulphides Project was updated in the 2018 exploration results for these ore bodies, resulting in an increase in gold ore resources. The integrated scenario for Suruca ore bodies includes the heap leach oxides treatment and the gold sulphide treatment only by a carbon leaching plant ("CIL") located in Chapada. Alternatives for treating the Suruca sulphide portion earlier in the mine life are currently under study, including an exploration program designed to test new extensions of sulphide mineralization and metallurgical testing. The company plans to continue this development program until 2019 in order to build on the results of the 2017 and 2018 programs, which resulted in the expansion of the oxide and natural gas deposits. sulphides.
Canadian Malartic: The Canadian Malartic extension project is continuing as planned. Barnat's contributions are expected to start in 2019 and more significant ones in 2020. On a 50% basis, the expansionary capex is expected to be $ 37 million, of which $ 34 million is for the expansion project. in 2019. In the fourth quarter, work continued on the detour of Highway 117, pit preparation and tailings expansions.
OTHER OPTIMIZATION AND MONITORING INITIATIVES
Agua Rica: The Company is continuing to evaluate and engage in discussions on the different development scenarios for Agua Rica. This includes an integration scenario between Agua Rica and Alumbrera, in which a joint pre-feasibility study was launched. At the same time, the company continues to engage with other Alumbrera partners and various other stakeholders at the national and provincial levels. In addition, the company continues to offer alternatives for the development of Agua Rica. This includes the technical work and badysis of project development options for Agua Rica, as well as the consideration and consideration of various strategic alternatives, all with the aim of advancing the project and its value of area. Considerable efforts have been made to advance two development scenarios, one large-scale and the integrated open-pit operation, and the other an initially smaller but scalable autonomous operation. The large scale open-pit mine scenario envisions the above-mentioned integration at the nearby Alumbrera mine, in which the Company holds a 12.5% interest and for which it plans to complete an updated pre-feasibility study. during the first half of 2019.
Suyai: The company had previously completed an exploratory study that evaluated two ore processing options, both of which offered favorable economic conditions. The first was the construction of a CIL processing facility for on-site production of gold and silver in the form of walleye. The second involved the construction of a processing facility for the on – site production of gold and silver contained in a high quality concentrate, which would be shipped overseas for later recovery. precious metals. Both approaches consider an identical underground configuration with an average annual production greater than 200,000 ounces of gold and 300,000 ounces of silver. The company believes that both scenarios address past concerns with open pit mining and that the development scenario that includes on-site concentrate production addresses many of the previous concerns regarding the use of cyanide and may comply with provincial regulations in effect in Chubut. The company will work with local stakeholders to obtain and maintain its social license if the project moves forward at a more advanced stage.
The company is pursuing its development plans and other strategic solutions for the project. Given the scale of the work done, to date, the existing scoping study could quickly move to a feasibility study to develop the project quickly. The Suyai project is one of the highest gold-ready development projects in the Americas. Although a financial advisor has not been retained for the moment, the Company is evaluating its strategic alternatives in addition to the project's development.
Monument Bay: The deposits at Monument Bay are located in the Stull Lake Greenstone Belt, consisting of three volcanic bademblages, ranging in age from 2.85 to 2.71 Ga. Gold and tungsten mineralization are found in the along the strongly inclined shear zone north of Twin Lakes and the AZ Sheer Zone.
In 2018, approximately 16,270 meters of drilling has been completed on the Monument Bay Project. The objective was to test targets near the Twin Lakes deposit and test regional targets. In addition, during the reporting period, a new geological interpretation of the deposit was completed and should be used as the basis for updating a block model and mineral resource estimate. Preparatory work continues and opens up prospects for follow-up testing in 2019.
On September 13, 2018, the Company signed an exploration agreement with the Red Sucker Lake First Nations regarding the Monument Bay exploration site in northern Manitoba. This is an important step for the Corporation to consolidate strategic collaboration with this community while continuing the project.
Other: The company is pursuing its development efforts and strategic initiatives regarding Agua De La Falda's 56.7% joint venture with Codelco in northern Chile. The historical feasibility study Jeronimo focused on maximizing the production of sulphide deposits. The company has completed the study of a low-capital start-up project based on the positive results of remaining oxide stocks and is currently evaluating exploration plans relating to the very promising claims surrounding the mine. Agua De La Falda has installed processing capacity and infrastructure.
SUMMARY OF MINERAL RESERVES AND MINERAL RESOURCES AT THE END OF YEAR
At December 31, 2018.
| Proven and probable mineral reserves | |||
| Tons (000) | Grade (g / t) | Oz contained (in thousands) | |
| Gold | 865653 | 0.45 | 12,496 |
| money | 11,736 | 174.5 | 65,828 |
| Tons (000) | Grade (%) | Lbs content (M) | |
| Copper | 673.357 | 0.25 | 3,784 |
| Measured and Indicated Mineral Resources | |||
| Tons (000) | Grade (g / t) | Oz contained (in thousands) | |
| Gold | 771,033 | 0.64 | 15,941 |
| money | 13,807 | 84.1 | 37,317 |
| Tons (000) | Grade (%) | Lbs content (M) | |
| Copper | 431.522 | 0.22 | 2,090 |
| Inferred Mineral Resources | |||
| Tons (000) | Grade (g / t) | Oz contained (in thousands) | |
| Gold | 333516 | 0.95 | 10,162 |
| money | 25,770 | 64.4 | 53377 |
| Tons (000) | Grade (%) | Lbs content (M) | |
| Copper | 156,928 | 0.23 | 785 |
Additional details regarding the Company's reserves and mineral resource estimates as at December 31, 2018 are presented below.
Chapada, Brazil
Due to the continued definition and expansion of Sucupira mineral reserves, immediately adjacent to the main Chapada pit, gold and copper mineral reserves increased by 6% and 7%, respectively, over the fiscal year. previous year, which represents a clear overall improvement over depletion in 2018. Mineral resources reported and measured in gold increased by 20%, while copper resources increased by 54% over the year. previous, as a result of drilling for the extension of the mineral envelopes at Corpo Sul under the mineral resources of Bois River and Santa Cruz. in Sucupira and Baru. Inferred mineral resources in gold are unchanged from 2017, while copper has increased significantly.
The graph below summarizes the changes in Chapada's gold mineral reserves as at December 31, 2018 compared to the previous period.
A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/a2b0885d-7377-4c2d-a074-05caed4a106c
- Gold mineral reserves in thousands of ounces.
- Additions to Sucupira and Baru as a result of infill drilling and engineering.
The graph below summarizes the evolution of copper mineral reserves in Chapada as at December 31, 2018 compared to the previous period.
A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/945eebb7-1176-4393-8531-e046c6728fba
- Mineral reserves of copper in millions of pounds.
- Additions to Sucupira and Baru as a result of infill drilling and engineering.
El Peñón, Chile
El Peñón's mineral reserves increased by 5% for gold and 6% for silver compared to mine depletion in 2018. Measured and indicated mineral resources increased by 24%, while money has increased by 30% over the previous year, thanks to many secondary vein structures. in the area of the mine is. The inferred mineral resources in gold and silver reflect the conversion to indicated mineral resources.
The graph below summarizes the evolution of gold mineral reserves in El Peñón as of December 31, 2018 compared to the previous period.
A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/25d422cc-335c-4a1f-842e-7e1d58bd7d9b
- Gold mineral reserves in thousands of ounces.
- Adjustments with optimization of mine design.
- Additions with infill drilling and conversion of low grade stock after sampling and metallurgical testing.
The graph below summarizes the evolution of silver mineral reserves in El Peñón as of December 31, 2018 compared to the previous period.
A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/e873b1d4-bbfa-481d-9174-8a57c021c142.
- Mineral reserves of silver in thousands of ounces.
- Adjustments with optimization of mine design.
- Additions with infill drilling and conversion of low grade stock after sampling and metallurgical testing.
Canadian Malartic, including Odyssey, Canada (50%)
The gold mineral reserves reflect the depletion badociated with the 2018 production at Canadian Malartic. Separately, much of the mineral resource accumulation in 2018 is badociated with the subsoil of East Malartic. Additional drilling, also in East Malartic and Odyssey, contributed to the 33% increase in measured and indicated gold mineral resources and a 1% increase in inferred mineral resources in gold.
A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/93a3cf9e-9188-461c-a270-206a08d47e6c.
- Gold mineral reserves in thousands of ounces.
- Adjustments to pit design and cut-off grade.
Jacobina, Brazil
Jacobina has managed to increase gold mineral reserves by 11% compared to the 2018 mining depletion. Measured and indicated mineral resources are in line with 2017 and reflect conversion to mineral reserves. Les ressources minérales présumées ont considérablement augmenté de plus de 800 000 onces d'or, malgré l'augmentation de la teneur de coupure de 0,5 g / t à 1,0 g / t. Le programme d'exploration à Jacobina a également atteint l'objectif principal de l'année, qui consistait à identifier et à définir une minéralisation à haute teneur proche de l'infrastructure actuelle. Plusieurs zones ont été définies, notamment João Belo, Morro do Vento Sud et la partie nord, Serra do Corrego et Canavieiras Sul. En 2019, les forages exploratoires continueront de se concentrer sur l'extension de ces zones à haute teneur, notamment l'extension sud de João Belo. Le programme de forage de définition se poursuivra en 2019 afin d'accroître la confiance dans la géométrie du récif et la localisation des failles pour les secteurs devant être exploités au cours des trois prochaines années.
Le graphique ci-dessous résume les variations des réserves minérales aurifères chez Jacobina au 31 décembre 2018 par rapport à la période précédente.
Une photo accompagnant cette annonce est disponible à l'adresse http://www.globenewswire.com/NewsRoom/AttachmentNg/286fc621-c8b1-438d-8505-662cb7a8f53f
- Réserves minérales d’or en milliers d’onces.
- Ajouts principalement à Morro do Vento avec des récifs supplémentaires.
Minera Florida, Chili
À Minera Florida, la diminution des réserves minérales est le résultat de l'épuisement de la mine et de l'application d'un modèle géologique actualisé et de paramètres de conception plus conservateurs avec des teneurs limites plus élevées, en particulier autour des zones minières historiques. Les ressources minérales d'or mesurées et indiquées ont augmenté de 5%, en raison de la mise à niveau de certaines ressources minérales présumées. Les zones PVS et Pataguas seront les cibles principales des forages d'exploration de 2019.
Le graphique ci-dessous résume les variations des réserves minérales aurifères de Minera Florida au 31 décembre 2018 par rapport à la période précédente.
Une photo accompagnant cette annonce est disponible à l'adresse http://www.globenewswire.com/NewsRoom/AttachmentNg/c9fc2b40-b146-4ad3-82a3-3daed9c27d8b.
- Réserves minérales d’or en milliers d’onces.
- Ajustement de l'interprétation géologique et de la teneur limite.
- Ajouts dus au forage intercalaire.
Cerro Moro, Argentine
À Cerro Moro, l'augmentation des réserves minérales d'or et d'argent a partiellement compensé l'épuisement lié à la production de 2018. Les principales augmentations proviennent de la découverte du nouveau filon Veronica à haute teneur et proche de la surface et des extensions de Nini. Les forages dans la zone centrale de la mine ont également révélé des intersections minéralisées à Michelle, Milagros et Tres Lomas, qui feront l'objet d'un suivi en 2019. Les paramètres économiques mis à jour avec des teneurs maximales plus élevées pour les réserves minérales et les ressources minérales ont eu pour effet de réduire le tonnage, mais en augmentant la note globale. En raison de la focalisation antérieure du site sur le développement du projet, le démarrage et la montée en puissance des opérations, les travaux d'exploration à long terme ont débuté en 2018 et, de ce fait, les ressources minérales actuelles ne tiennent pas compte des résultats de forage des quatre derniers mois de l'année. . Ces résultats sont en cours d'badyse et devraient fournir des objectifs de bonne qualité pour 2019. Cela a finalement abouti à une baisse de 13% de la valeur de l'or pour les ressources minérales mesurées et indiquées restantes et à une réduction de 24% des ressources minérales présumées. L'exploration régionale au sud de la mine a intercepté une vaste zone de minéralisation à Naty. Ces zones devraient faire l'objet de nouveaux forages en 2019, dans le cadre de l'allocation accrue du budget d'exploration à la mine.
Le graphique ci-dessous résume l'évolution des réserves minérales aurifères de Cerro Moro au 31 décembre 2018 par rapport à la période précédente.
Une photo accompagnant cette annonce est disponible à l'adresse http://www.globenewswire.com/NewsRoom/AttachmentNg/ce40cb4e-75b5-4d71-a621-201a6ee21ea5
- Réserves minérales d’or en milliers d’onces.
- Ajustements aux paramètres de calcul de la teneur de coupure et de la mine.
- Ajout de nouvelles zones, notamment Veronica et Nini.
Le graphique ci-dessous résume l'évolution des réserves minérales d'argent à Cerro Moro au 31 décembre 2018 par rapport à la période précédente.
Une photo accompagnant cette annonce est disponible à l'adresse http://www.globenewswire.com/NewsRoom/AttachmentNg/789900bd-8843-4438-b4bf-2e0fbf3aff8b
- Réserves minérales d'argent en milliers d'onces.
- Ajustements aux paramètres de calcul de la teneur de coupure et de la mine.
- Ajout de nouvelles zones, notamment Veronica et Nini.
STATISTIQUES CLES
Les principales statistiques opérationnelles et financières pour le quatrième trimestre et l'exercice 2018 sont présentées dans les tableaux suivants.
Résumé financier
| Trois mois se terminant le 31 décembre | Douze mois se terminant le 31 décembre | |||||||
| (En millions de dollars américains, à l'exception des actions et des montants par action) | 2018 | 2017 | 2018 | 2017 | ||||
| Returned | 483.4 | 478,8 | 1 798,5 | 1 803,8 | ||||
| Coût des ventes hors épuisement, amortissements et dépréciations | (266,2 | ) | (264,7 | ) | (1 010,0 | ) | (1 042,4 | ) |
| Épuisement et amortissement | (130,9 | ) | (100,9 | ) | (438,3 | ) | (426,8 | ) |
| Coût total des ventes | (397,1 | ) | (365,6 | ) | (1 448,3 | ) | (1 469,2 | ) |
| Résultat d'exploitation minière | 40,3 | (143,7 | ) | 201,2 | 77,7 | |||
| Dépenses générales et administratives | (21,0 | ) | (34,0 | ) | (91,8 | ) | (113,6 | ) |
| Frais d'exploration et d'évaluation | (3.6 | ) | (7.0 | ) | (13.0 | ) | (21.2 | ) |
| Perte nette d'exploitation | (61,4 | ) | (198,3 | ) | (297,7 | ) | (198,1 | ) |
| Net loss attributable to Yamana Gold equity holders | (61.4 | ) | (188.6 | ) | (284.6 | ) | (188.5 | ) |
| Net loss from operations, per share – basic and diluted(1) | (0.06 | ) | (0.20 | ) | (0.30 | ) | (0.20 | ) |
| Cash flow generated from operations after changes in non-cash working capital | 114.7 | 158.5 | 404.2 | 484.0 | ||||
| Cash flow from operations before changes in non-cash working capital(2) | 115.8 | 122.3 | 566.3 | 498.0 | ||||
| Revenue per ounce of gold | 1,223 | 1,269 | 1,263 | 1,250 | ||||
| Revenue per ounce of silver | 14.59 | 16.46 | 15.37 | 16.80 | ||||
| Revenue per pound of copper | 2.56 | 2.36 | 2.70 | 2.36 | ||||
| Average realized gold price per ounce | 1,226 | 1,286 | 1,267 | 1,264 | ||||
| Average realized silver price per ounce | 14.59 | 16.49 | 15.37 | 16.83 | ||||
| Average realized copper price per pound | 2.90 | 3.02 | 2.99 | 2.78 | ||||
- For the three and twelve months ended December 31, 2018, the weighted average numbers of shares outstanding, basic and diluted, was 949,337 thousand and 949,030 thousand, respectively.
- Refers to a non-GAAP financial measure or an additional line item or subtotal in financial statements. Please see the discussion included at the end of this press release under the heading “Non-GAAP Financial Measures and Additional Line Items and Subtotals in Financial Statements”. Reconciliations for all non-GAAP financial measures are available at www.yamana.com/Q42018 and in Section 11 of the Company’s fourth quarter 2018 Management’s Discussion & Analysis, which has been filed on SEDAR.
Production, Financial and Operating Summary
| Three Months Ending Dec 31st | Twelve Months Ending Dec 31st | |||||||
| Gold | 2018 | 2017 | 2018 | 2017 | ||||
| Total cost of sales per ounce sold – Yamana Mines | $ | 999 | $ | 929 | $ | 1,008 | $ | 973 |
| Total cost of sales per ounce sold – Total Yamana | $ | 1,010 | $ | 966 | $ | 1,031 | $ | 1,023 |
| Total cost of sales per ounce sold – consolidated | $ | 1,010 | $ | 980 | $ | 1,042 | $ | 1,038 |
| Co-product cash costs per ounce produced – Yamana Mines(1) | $ | 570 | $ | 612 | $ | 614 | $ | 621 |
| Co-product cash costs per ounce produced – Total Yamana(1) | $ | 610 | $ | 660 | $ | 649 | $ | 672 |
| All-in sustaining co-product costs per ounce produced – Yamana Mines(1) | $ | 763 | $ | 884 | $ | 816 | $ | 869 |
| All-in sustaining co-product costs per ounce produced – Total Yamana(1) | $ | 801 | $ | 899 | $ | 843 | $ | 888 |
| Silver | 2018 | 2017 | 2018 | 2017 | ||||
| Total cost of sales per ounce sold | $ | 14.23 | $ | 13.26 | $ | 15.58 | $ | 13.63 |
| Co-product cash costs per ounce produced(1) | $ | 7.12 | $ | 8.86 | $ | 8.25 | $ | 10.01 |
| All-in sustaining co-product costs per ounce produced(1) | $ | 9.57 | $ | 11.90 | $ | 10.81 | $ | 13.48 |
| Copper | 2018 | 2017 | 2018 | 2017 | ||||
| Total cost of sales per copper pound sold | $ | 1.87 | $ | 1.68 | $ | 1.80 | $ | 1.74 |
| Co-product cash costs per pound of copper produced(1) | $ | 1.50 | $ | 1.51 | $ | 1.51 | $ | 1.54 |
| All-in sustaining co-product costs per pound of copper produced(1) | $ | 1.86 | $ | 1.85 | $ | 1.90 | $ | 1.89 |
| Three Months Ending Dec 31st | Twelve Months Ending Dec 31st | |||||||
| By-Product Costs | 2018 | 2017 | 2018 | 2017 | ||||
| By-product cash costs per gold ounce produced – Yamana Mines(1) | $ | 420 | $ | 476 | $ | 445 | $ | 490 |
| All-in sustaining by-product costs per gold ounce produced – Yamana Mines(1) | $ | 657 | $ | 800 | $ | 696 | $ | 788 |
| By-product cash costs per silver ounce produced(1) | $ | 4.99 | $ | 7.44 | $ | 5.90 | $ | 8.58 |
| All-in sustaining by-product costs per silver ounce produced(1) | $ | 7.99 | $ | 11.05 | $ | 9.11 | $ | 12.65 |
- Refers to a non-GAAP financial measure or an additional line item or subtotal in financial statements. Please see the discussion included at the end of this press release under the heading “Non-GAAP Financial Measures and Additional Line Items and Subtotals in Financial Statements”. Reconciliations for all non-GAAP financial measures are available at www.yamana.com/Q42018 and in Section 11 of the Company’s fourth quarter 2018 Management’s Discussion & Analysis, which has been filed on SEDAR.
| Three Months Ending Dec 31st | Twelve Months Ending Dec 31st | ||||
| Gold Ounces | 2018 | 2017 | 2018 | 2017 | |
| Chapada | 40,841 | 36,578 | 121,003 | 119,852 | |
| El Peñón | 37,956 | 39,401 | 151,893 | 160,509 | |
| Canadian Malartic (50%) | 84,732 | 80,743 | 348,600 | 316,731 | |
| Jacobina | 37,071 | 34,566 | 144,695 | 135,806 | |
| Cerro Moro | 45,066 | – | 92,793 | – | |
| Minera Florida | 24,526 | 23,540 | 81,635 | 90,366 | |
| Production – Yamana Mines | 270,193 | 214,828 | 940,619 | 823,263 | |
| Gualcamayo | 22,291 | 44,778 | 92,285 | 154,052 | |
| Production – Total Yamana | 292,484 | 259,606 | 1,032,903 | 977,315 | |
| Three Months Ending Dec 31st | Twelve Months Ending Dec 31st | ||||
| Silver Ounces | 2018 | 2017 | 2018 | 2017 | |
| El Peñón | 1,186,789 | 1,052,423 | 3,903,961 | 4,282,339 | |
| Cerro Moro | 2,077,906 | – | 4,119,085 | – | |
| TOTAL | 3,264,695 | 1,052,423 | 8,023,046 | 4,282,339 | |
For a full discussion of Yamana’s operational and financial results and Mineral Reserve and Mineral Resource estimates please refer to the Company’s fourth quarter 2018 Management’s Discussion & Analysis and Consolidated Financial Statements which have been filed on SEDAR and are also available on the Company’s website.
| MINERAL RESERVE AND MINERAL RESOURCE ESTIMATES | |||||||||
| Mineral Reserves (Proven and Probable) | |||||||||
| The following table sets forth the Mineral Reserve estimates for the Company’s mineral projects as at December 31, 2018. | |||||||||
| Proven Mineral Reserves | Probable Mineral Reserves |
Total Proven & Probable | |||||||
| Gold | Tonnes | Grade | Contained | Tonnes | Grade | Contained | Tonnes | Grade | Contained |
| (000's) | (g/t) | oz. (000's) | (000's) | (g/t) | oz. (000's) | (000's) | (g/t) | oz. (000's) | |
| Alumbrera (12.5%) | 8,435 | 0.39 | 106 | 294 | 0.37 | 4 | 8,728 | 0.39 | 109 |
| Canadian Malartic (50%) | 23,029 | 0.89 | 658 | 55,799 | 1.18 | 2,122 | 78,829 | 1.10 | 2,780 |
| Cerro Moro | 43 | 10.57 | 15 | 1,766 | 11.64 | 661 | 1,809 | 11.61 | 675 |
| Chapada Zones | 388,701 | 0.17 | 2,103 | 275,928 | 0.16 | 1,381 | 664,629 | 0.16 | 3,484 |
| Suruca Zones | 11,454 | 0.42 | 153 | 53,741 | 0.53 | 908 | 65,195 | 0.51 | 1,062 |
| Total Chapada | 400,155 | 0.18 | 2,256 | 329,669 | 0.22 | 2,289 | 729,824 | 0.19 | 4,546 |
| El Peñón Ore | 693 | 5.11 | 114 | 3,738 | 5.38 | 646 | 4,431 | 5.33 | 760 |
| El Peñón Stockpiles | 17 | 2.41 | 1 | 1,029 | 1.18 | 39 | 1,047 | 1.20 | 40 |
| Total El Peñón | 710 | 5.04 | 115 | 4,768 | 4.47 | 685 | 5,478 | 4.55 | 800 |
| Jacobina | 18,565 | 2.32 | 1,385 | 9,290 | 2.39 | 714 | 27,855 | 2.34 | 2,099 |
| Jeronimo (57%) | 6,350 | 3.91 | 798 | 2,331 | 3.79 | 284 | 8,681 | 3.88 | 1,082 |
| Minera Florida Ore | 690 | 3.61 | 80 | 2,512 | 3.54 | 286 | 3,202 | 3.56 | 366 |
| Minera Florida Tailings | 0 | 0.00 | 0 | 1,248 | 0.94 | 38 | 1,248 | 0.94 | 38 |
| Total Minera Florida | 690 | 3.61 | 80 | 3,760 | 2.68 | 324 | 4,449 | 2.82 | 404 |
| Total Gold Mineral Reserves | 457,977 | 0.37 | 5,413 | 407,677 | 0.54 | 7,083 | 865,653 | 0.45 | 12,496 |
| Agua Rica | 384,871 | 0.25 | 3,080 | 524,055 | 0.21 | 3,479 | 908,926 | 0.22 | 6,559 |
| Silver | Tonnes | Grade | Contained | Tonnes | Grade | Contained | Tonnes | Grade | Contained |
| (000's) | (g/t) | oz. (000's) | (000's) | (g/t) | oz. (000's) | (000's) | (g/t) | oz. (000's) | |
| Cerro Moro | 43 | 620.7 | 857 | 1,766 | 653.3 | 37,102 | 1,809 | 652.6 | 37,959 |
| El Peñón Ore | 693 | 166.1 | 3,700 | 3,738 | 171.7 | 20,630 | 4,431 | 170.8 | 24,330 |
| El Peñón Stockpiles | 17 | 107.2 | 60 | 1,029 | 15.2 | 502 | 1,046 | 16.7 | 562 |
| Total El Peñón | 710 | 164.7 | 3,760 | 4,768 | 137.9 | 21,133 | 5,478 | 141.3 | 24,893 |
| Minera Florida Ore | 690 | 28.1 | 623 | 2,512 | 21.9 | 1,770 | 3,202 | 23.2 | 2,393 |
| Minera Florida Tailings | 0 | 0.0 | 0 | 1,248 | 14.6 | 584 | 1,248 | 14.6 | 584 |
| Total Minera Florida | 690 | 28.1 | 623 | 3,760 | 19.5 | 2,353 | 4,449 | 20.8 | 2,976 |
| Total Silver Mineral Reserves | 1,443 | 112.9 | 5,240 | 10,294 | 183.1 | 60,588 | 11,736 | 174.5 | 65,828 |
| Agua Rica | 384,871 | 3.7 | 46,176 | 524,055 | 3.3 | 56,070 | 908,926 | 3.5 | 102,246 |
| Copper | Tonnes | Grade | Contained | Tonnes | Grade | Contained | Tonnes | Grade | Contained |
| (000's) | (%) | lbs (mm) | (000's) | (%) | lbs (mm) | (000's) | (%) | lbs (mm) | |
| Alumbrera (12.5%) | 8,435 | 0.40 | 74 | 294 | 0.38 | 3 | 8,728 | 0.40 | 77 |
| Chapada Zones | 388,701 | 0.25 | 2,138 | 275,928 | 0.26 | 1,568 | 664,629 | 0.25 | 3,707 |
| Suruca Zones | 0 | 0.00 | 0 | 0 | 0.00 | 0 | 0 | 0.00 | 0 |
| Total Chapada | 388,701 | 0.25 | 2,138 | 275,928 | 0.26 | 1,568 | 664,629 | 0.25 | 3,707 |
| Total Copper Mineral Reserves | 397,136 | 0.25 | 2,212 | 276,222 | 0.26 | 1,571 | 673,357 | 0.25 | 3,784 |
| Agua Rica | 384,871 | 0.56 | 4,779 | 524,055 | 0.43 | 5,011 | 908,926 | 0.49 | 9,790 |
| Zinc | Tonnes | Grade | Contained | Tonnes | Grade | Contained | Tonnes | Grade | Contained |
| (000's) | (%) | lbs (mm) | (000's) | (%) | lbs (mm) | (000's) | (%) | lbs (mm) | |
| Minera Florida Ore | 690 | 1.53 | 23 | 2,512 | 1.13 | 62 | 3,202 | 1.21 | 85 |
| Minera Florida Tailings | 0 | 0.00 | 0 | 1,248 | 0.58 | 16 | 1,248 | 0.58 | 16 |
| Total Zinc Mineral Reserves | 690 | 1.53 | 23 | 3,760 | 0.94 | 78 | 4,449 | 1.04 | 102 |
| Molybdenum | Tonnes | Grade | Contained | Tonnes | Grade | Contained | Tonnes | Grade | Contained |
| (000's) | (%) | lbs (mm) | (000's) | (%) | lbs (mm) | (000's) | (%) | lbs (mm) | |
| Alumbrera (12.5%) | 8,435 | 0.013 | 2.45 | 294 | 0.014 | 0.09 | 8,728 | 0.013 | 2.54 |
| Total Moly Mineral Reserves | 8,435 | 0.013 | 2.45 | 294 | 0.014 | 0.09 | 8,728 | 0.013 | 2.54 |
| Agua Rica | 384,871 | 0.033 | 279 | 524,055 | 0.030 | 350 | 908,926 | 0.031 | 629 |
| Mineral Resources (Measured, Indicated, and Inferred) | |||||||||
| The following tables set forth the Mineral Resource estimates for the Company’s mineral projects as at December 31, 2018. | |||||||||
| Measured Mineral Resources |
Indicated Mineral Resources |
Total Measured & Indicated |
|||||||
| Gold | Tonnes | Grade | Contained | Tonnes | Grade | Contained | Tonnes | Grade | Contained |
| (000's) | (g/t) | oz. (000's) | (000's) | (g/t) | oz. (000's) | (000's) | (g/t) | oz. (000's) | |
| Alumbrera (12.5%) | 6,792 | 0.39 | 85 | 1,917 | 0.54 | 33 | 8,709 | 0.42 | 117.8 |
| Arco Sul | 0 | 0.00 | 0 | 0 | 0.00 | 0 | 0 | 0.00 | 0.0 |
| Canadian Malartic (50%) | 1,885 | 1.36 | 83 | 13,615 | 1.80 | 786 | 15,500 | 1.74 | 868.7 |
| Cerro Moro | 18 | 10.83 | 6 | 1,224 | 5.14 | 202 | 1,241 | 5.22 | 208.4 |
| Chapada Zones | 58,885 | 0.12 | 222 | 363,929 | 0.14 | 1,676 | 422,814 | 0.14 | 1,897.8 |
| Suruca Zones | 1,284 | 0.39 | 16 | 81,039 | 0.54 | 1,416 | 82,323 | 0.54 | 1,432.0 |
| Total Chapada | 60,169 | 0.12 | 238 | 444,968 | 0.22 | 3,092 | 505,137 | 0.21 | 3,329.8 |
| El Peñón Mine | 232 | 8.02 | 60 | 1,579 | 5.88 | 298 | 1,811 | 6.15 | 358.0 |
| El Peñón Tailings | 0 | 0.00 | 0 | 0 | 0.00 | 0 | 0 | 0.00 | 0.0 |
| El Peñón Stockpiles | 0 | 0.00 | 0 | 1,019 | 1.13 | 37 | 1,019 | 1.13 | 37.0 |
| El Peñón Total | 232 | 8.04 | 60.0 | 2,598.0 | 4.0 | 336.0 | 2,830 | 4.35 | 396.0 |
| Jacobina | 24,999 | 2.48 | 1,994 | 15,711 | 2.45 | 1,238 | 40,710 | 2.47 | 3,232.0 |
| Jeronimo (57%) | 772 | 3.77 | 94 | 385 | 3.69 | 46 | 1,157 | 3.74 | 139.0 |
| La Pepa | 15,750 | 0.61 | 308 | 133,682 | 0.57 | 2,452 | 149,432 | 0.57 | 2,760.0 |
| Lavra Velha | 0 | 0.00 | 0 | 0 | 0.00 | 0 | 0 | 0.00 | 0.0 |
| Minera Florida | 1,207 | 5.87 | 228 | 3,829 | 4.79 | 590 | 5,036 | 5.05 | 817.0 |
| Monument Bay | 0 | 0.00 | 0 | 36,581 | 1.52 | 1,787 | 36,581 | 1.52 | 1,787.2 |
| Suyai | 0 | 0.00 | 0 | 4,700 | 15.00 | 2,286 | 4,700 | 15.00 | 2,286.0 |
| Total Gold Mineral Resources | 111,823 | 0.86 | 3,095 | 659,210 | 0.61 | 12,849 | 771,033 | 0.64 | 15,941 |
| Agua Rica | 27,081 | 0.14 | 120 | 173,917 | 0.14 | 776 | 200,998 | 0.14 | 896 |
| Silver | Tonnes | Grade | Contained | Tonnes | Grade | Contained | Tonnes | Grade | Contained |
| (000's) | (g/t) | oz. (000's) | (000's) | (g/t) | oz. (000's) | (000's) | (g/t) | oz. (000's) | |
| Cerro Moro | 18 | 1,253.0 | 707 | 1,224 | 381.2 | 14,997 | 1,241 | 393.5 | 15,704 |
| El Peñón Mine | 232 | 194.6 | 1,450 | 1,579 | 207.1 | 10,512 | 1,811 | 205.4 | 11,962 |
| El Peñón Tailings | 0 | 0.00 | 0 | 0 | 0.00 | 0 | 0.00 | 0.0 | 0 |
| El Peñón Stockpiles | 0 | 0.00 | 0 | 1,019 | 28.80 | 942 | 1,019 | 28.8 | 942 |
| El Peñón Total | 232 | 194.6 | 1,450 | 2,598 | 137.1 | 11,454 | 2,830 | 141.8 | 12,904 |
| Minera Florida | 1,207 | 41.0 | 1,592 | 3,829 | 29.2 | 3,594 | 5,036 | 32.0 | 5,186 |
| Suyai | 0 | 0.0 | 0 | 4,700 | 23.0 | 3,523 | 4,700 | 23.0 | 3,523 |
| Total Silver Mineral Resources | 1,457 | 80.1 | 3,749 | 12,351 | 84.5 | 33,568 | 13,807 | 84.1 | 37,317 |
| Agua Rica | 27,081 | 2.4 | 2,042 | 173,917 | 2.9 | 16,158 | 200,998 | 2.8 | 18,200 |
| Copper | Tonnes | Grade | Contained | Tonnes | Grade | Contained | Tonnes | Grade | Contained |
| (000's) | (g/t) | oz. (000's) | (000's) | (g/t) | oz. (000's) | (000's) | (g/t) | oz. (000's) | |
| Alumbrera (12.5%) | 6,792 | 0.37 | 55 | 1,917 | 0.24 | ten | 8,709 | 0.34 | 65 |
| Chapada Zones | 58,885 | 0.20 | 261 | 363,929 | 0.22 | 1,765 | 422,814 | 0.22 | 2,025 |
| Suruca Zones | 0 | 0.00 | 0 | 0 | 0 | 0 | 0 | 0.00 | 0 |
| Total Chapada | 58,885 | 0.20 | 261 | 363,929 | 0.22 | 1,765 | 422,814 | 0.22 | 2,025 |
| Total Copper Mineral Resources | 65,676 | 0.22 | 316 | 365,846 | 0.22 | 1,775 | 431,522 | 0.22 | 2,090 |
| Agua Rica | 27,081 | 0.45 | 266 | 173,917 | 0.38 | 1,447 | 200,998 | 0.39 | 1,714 |
| Zinc | Tonnes | Grade | Contained | Tonnes | Grade | Contained | Tonnes | Grade | Contained |
| (000's) | (g/t) | oz. (000's) | (000's) | (g/t) | oz. (000's) | (000's) | (g/t) | oz. (000's) | |
| Minera Florida | 1,207 | 2.22 | 62 | 3,829 | 1.63 | 138 | 5,036 | 1.77 | 197 |
| Total Zinc Mineral Resources | 1,207 | 2.22 | 62 | 3,829 | 1.63 | 138 | 5,036 | 1.77 | 197 |
| Molybdenum | Tonnes | Grade | Contained | Tonnes | Grade | Contained | Tonnes | Grade | Contained |
| (000's) | (g/t) | oz. (000's) | (000's) | (g/t) | oz. (000's) | (000's) | (g/t) | oz. (000's) | |
| Alumbrera (12.5%) | 6,192 | 0.014 | 1.94 | 462 | 0.013 | 0.13 | 6,654 | 0.014 | 2.07 |
| Total Moly Mineral Resources | 6,192 | 0.014 | 1.94 | 462 | 0.013 | 0.13 | 6,654 | 0.014 | 2.07 |
| Agua Rica | 27,081 | 0.049 | 29 | 173,917 | 0.037 | 142 | 200,998 | 0.039 | 172 |
| Inferred Mineral Resources |
|||
| Gold | Tonnes | Grade | Contained |
| (000's) | (g/t) | oz. (000's) | |
| Alumbrera (12.5%) | 848 | 0.46 | 13 |
| Arco Sul | 5,000 | 4.02 | 646 |
| Canadian Malartic (50%) | 36,210 | 1.99 | 2,319 |
| Cerro Moro | 1,706 | 3.84 | 211 |
| Chapada Zones | 156,081 | 0.08 | 422 |
| Suruca Zones | 12,565 | 0.48 | 194 |
| Total Chapada | 168,646 | 0.11 | 616 |
| El Peñón Mine | 2,953 | 7.25 | 689 |
| El Peñón Tailings | 13,767 | 0.55 | 245 |
| El Peñón Stockpiles | 0 | 0.00 | 0 |
| El Peñón Total | 16,719 | 1.74 | 933 |
| Jacobina | 12,145 | 2.58 | 1,008 |
| Jeronimo (57%) | 1,118 | 4.49 | 161 |
| La Pepa | 37,900 | 0.50 | 620 |
| Lavra Velha | 3,934 | 4.29 | 543 |
| Minera Florida | 6,445 | 5.01 | 1,038 |
| Monument Bay | 41,946 | 1.32 | 1,781 |
| Suyai | 900 | 9.90 | 274 |
| Total Gold Mineral Resources | 333,516 | 0.95 | 10,162 |
| Agua Rica | 642,110 | 0.12 | 2,444 |
| Silver | Tonnes | Grade | Contained |
| (000's) | (g/t) | oz. (000's) | |
| Cerro Moro | 1,706 | 257.8 | 14,139 |
| El Peñón Mine | 2,953 | 254.8 | 24,190 |
| El Peñón Tailings | 13,767 | 18.9 | 8,380 |
| El Peñón Stockpiles | 0 | 0.0 | 0 |
| El Peñón Total | 16,719 | 60.6 | 32,570 |
| Minera Florida | 6,445 | 29.4 | 6,093 |
| Suyai | 900 | 21.0 | 575 |
| Total Silver Mineral Resources | 25,770 | 64.4 | 53,377 |
| Agua Rica | 642,110 | 2.3 | 48,124 |
| Copper | Tonnes | Grade | Contained |
| (000's) | (g/t) | oz. (000's) | |
| Alumbrera (12.5%) | 848 | 0.21 | 4 |
| Chapada Zones | 156,081 | 0.23 | 781 |
| Suruca Zones | 0 | 0 | 0 |
| Total Chapada | 156,081 | 0.23 | 781 |
| Total Copper Mineral Resources | 156,928 | 0.23 | 785 |
| Agua Rica | 642,110 | 0.34 | 4,853 |
| Zinc | Tonnes | Grade | Contained |
| (000's) | (g/t) | oz. (000's) | |
| Minera Florida | 6,445 | 1.32 | 187 |
| Total Zinc Mineral Resources | 6,445 | 1.32 | 187 |
| Molybdenum | Tonnes | Grade | Contained |
| (000's) | (g/t) | oz. (000's) | |
| Alumbrera (12.5%) | 85 | 0.014 | 0.03 |
| Total Molybdenum Mineral Resources | 85 | 0.014 | 0.03 |
| Agua Rica | 642,110 | 0.034 | 480 |
Mineral Reserve and Mineral Resource Reporting Notes
1. Metal Price, Cut-off Grade, Metallurgical Recovery:
| Mine | Mineral Reserves | Mineral Resources | ||
| Alumbrera Projects (12.5%) | ||||
| Alumbrera Deposit | Price badumption: $1,250 gold, $2.91 copper | Price badumption: $1,250 gold, $2.95 copper | ||
| Underground cut-off at 0.5% copper equivalent | Underground cut-off at 0.43% copper equivalent | |||
| Metallurgical recoveries average 87.85% for copper and 72.31% for gold | ||||
| Bajo El Durazno Deposit | N / A | Price badumption: $1,250 gold, $2.95 copper | ||
| 0.74 g/t Aueq cutoff within underground economic envelope | ||||
| Arco Sul | N / A | Price badumption: $1,500 gold | ||
| 2.5 g/t Au cutoff | ||||
| Canadian Malartic (50%) | Price badumption: $1,200 gold | Price badumption: $1,200 gold | ||
| Open pit cut-off grades range from 0.374 to 0.384 g/t Au | Cut-off grades range from 0.35 g/t Au inside pit to 1.0 g/t Au outside or below pit | |||
| Metallurgical recoveries for gold range from 87% to 96.7% depending on zone | Underground Cut-off grade at Odyssey is 1.15 g/t Au (stope optimized) and at East Malartic Underground is 1.25 g/t Au (stope optimized) | |||
| Cerro Moro | Price badumption: $1,250 gold and $18.00 silver | Price badumption: $1,600 gold and $24.00 silver | ||
| Open pit cut-off at 3.27 g/t gold and Underground cut-off at 5.71 g/t gold | 3.0 g/t Aueq cut-off | |||
| Metallurgical recoveries average 95% for gold and 93% for silver | ||||
| Chapada | ||||
| Chapada Zone | Price badumption: $1,250 gold, $3.00 copper | Price badumption: $1,600 gold , $4.00 copper | ||
| Open pit cut-off at $4.06/t (Main Pit, Corpo Sul, Cava Norte and Sucupira) | Open pit cut-off at $4.06/t (Chapada pits and Suruca SW) | |||
| Metallurgical recoveries at Chapada are dependent on zone and average 83.11% for copper and 56.94% for gold | Metallurgical recoveries at Chapada are dependent on zone and average 83.11% for copper and 56.94% for gold | |||
| Suruca Zone | Price badumption: $1,300 gold | Price badumption: $1,600 gold | ||
| Cut-off grade 0.19 g/t gold for Suruca oxide | Cut-off grade 0.16 g/t gold for Suruca oxide | |||
| Cut-off grade 0.3 g/t gold for Suruca sulfide | Cut-off grade 0.23 g/t gold for Suruca sulphide | |||
| Metallurgical recoveries for Suruca oxide average 85% for gold | Metallurgical recoveries for Suruca oxide average 85% for gold | |||
| Metallurgical recoveries for Suruca sulphide average 88% for gold | Metallurgical recoveries for Suruca sulphide average 88% for gold | |||
| El Peñón | Price Assumption:$1,250 gold, $18.00 silver | Price Assumption:$1,600 Au, $24.00 Ag | ||
| Open Pit cut-off at 1.75 g/t gold equivalent | Underground cut-off at 2.78 g/t gold equivalent except for Pampa Agusta Victoria (2.88 g/t), Chiquilla Chica (2.87 g/t), Laguna (2.85 g/t ) | |||
| Underground cut-off ranging from 3.57 g/t gold equivalent to 3.70 g/t gold equivalent | Fortuna-Dominador zones (2.84 g/t). Mill recoveries of 95% and 86.5% used for Mineral Resource Estimation | |||
| Low grade stockpiles cut-off 0.95 g/t gold equivalent | Mineral Resources contained in tailings and stockpiles reported at cut-offs of 05.0 g/t and 0.79 g/t gold equivalent respectively | |||
| Metallurgical recoveries for open pit ores range from 89.0% to 95.6% for gold and from 80.7% to 97.7% for silver | Metallurgical recoveries range from 87.2% to 99.0% for gold and from 59.8% to 92.6% for silver | |||
| Metallurgical recoveries for underground ores range from 87.2% to 99.0% for gold and from 59.8% to92.6% for silver | Metallurgical recoveries for tailings estimated to be 60% for gold and 30% for silver | |||
| Metallurgical recoveries for low grade stockpiles are 95.2% for gold and83.0% for silver | Metallurgical recoveries for stockpiles estimated to be 88.0% for gold and 80.8% for silver | |||
| Jacobina | Price badumptions: $1,250 gold | Price badumptions: $1600 gold | ||
| Underground cut-off grade is 1.20 g/t gold | Underground cut-off grade is 1.0 g/t gold with a minimum mining width of 1.5 metres | |||
| Metallurgical recovery is 96% | ||||
| Jeronimo (57%) | Price Assumption: $900 Au | |||
| Cut-off grade at 2.0 g/t gold | Cut-off grade at 2.0 g/t gold | |||
| Metallurgical recovery for Au is 86%. | ||||
| La Pepa | N / A | Price Assumption: $780 Au | ||
| cut-off grade at 0.30 g/t gold | ||||
| Lavra Velha | N / A | Price badumption: $1,300 gold and $3.50 copper | ||
| cut-off grade at 0.2g/t gold and 0.1% copper | ||||
| Minera Florida | Price badumption: $1,250/oz gold, $18.00/oz silver and $1.25/lb Zn. | Price badumption: $1,250/oz gold, $18.00/oz silver and $1.25/lb Zn | ||
| Underground cut-offs for Las Pataguas Zone USD90.75/t and for the Core Mine Zones USD94.79/t | Underground cut-off grade is 2.50 g/t gold | |||
| Metallurgical recoveries are 90.16% for gold, 52.31% for silver and 68.80% for zinc | Metallurgical recoveries are 90.16% for gold, 52.31% for silver and 68.80% for zinc | |||
| Monument Bay | N / A | Price Assumption: $1,200 Au | ||
| Cut-off grades are 0.4 g/t gold and 0.7 g/t gold for the open pits and 4.0 g/t gold for underground | ||||
| Suyai | N / A | 5.0 g/t Au cut-off inside mineralized wireframe modeling | ||
| Agua Rica | Price badumption: $1,000/oz gold, $2.25/lb copper, $17.00/oz silver and $12.00/lb molybdenum | Cut-off grade at 0.2% Copper | ||
| Metallurgical recoveries are 84.9% for copper, 52.7% for gold, 67.6% for silver, 65.9% for zinc and 68.0% for molybdenum | ||||
| 2. All Mineral Reserves and Mineral Resources have been calculated in accordance with the standards of the Canadian Institute of Mining, Metallurgy and Petroleum and National Instrument 43-101, other than the estimates for the Alumbrera mine which have been calculated in accordance with the JORC Code which is accepted under NI 43-101. | ||||
| 3. All Mineral Resources are reported exclusive of Mineral Reserves. | ||||
| 4. Mineral Resources which are not Mineral Reserves do not have demonstrated economic viability. | ||||
| 5. Mineral Reserves and Mineral Resources are reported as of December 31, 2018. | ||||
| 6. For the qualified persons responsible for the Mineral Reserve and Mineral Resource estimates at the Company’s material properties, see the qualified persons list below. | ||||
| Property | Qualified Persons for Mineral Reserves | Qualified Persons for Mineral Resources |
| Canadian Malartic | Sylvie Lampron, Canadian Malartic Corporation | Pascal Lehouiller, Canadian Malartic Corporation |
| Chapada | Luiz Pignatari, EDEM Engenharia | Felipe Machado de Araujo, Member of Chilean Mining Commission, Mineral Resources Coordinator Brazil, Yamana Gold Inc. |
| El Peñón | Sergio Castro, Yamana Gold Inc. | Jorge Camacho, Yamana Gold Inc. |
FOURTH QUARTER 2018 CONFERENCE CALL
The Company will host a conference call and webcast on Friday, February 15, 2019 at 9:00 a.m. ET.
Fourth Quarter and Full Year 2018 Conference Call Details
| Toll Free (North America): | 1-800-273-9672 | |
| Toronto Local and International: | 416-340-2216 | |
| Webcast: | www.yamana.com |
Conference Call Replay
| Toll Free (North America): | 1-800-408-3053 | |
| Toronto Local and International: | 905-694-9451 | |
| Pbadcode: | 6784586 |
The conference call replay will be available from 12:00 p.m. ET on February 15, 2019 until 11:59 p.m. ET on March 1, 2019.
Qualified Persons
Scientific and technical information contained in this Management’s Discussion and Analysis has been reviewed and approved by Sébastien Bernier (Senior Director, Geology and Mineral Resources). Sébastien Bernier is an employee of Yamana Gold Inc. and a "Qualified Person" as defined by Canadian Securities Administrators' National Instrument 43-101 – Standards of Disclosure for Mineral Projects.
About Yamana
Yamana is a Canadian-based gold, silver and copper producer with a significant portfolio comprised of operating mines, development stage projects, and exploration and mineral properties throughout the Americas, mainly in Canada, Brazil, Chile and Argentina. Yamana plans to continue to build on this base through expansion and optimization initiatives at existing operating mines, development of new mines, the advancement of its exploration properties and, at times, by targeting other consolidation opportunities with a primary focus in the Americas. The Company is listed on the Toronto Stock Exchange (trading symbol "YRI") and the New York Stock Exchange (trading symbol "AUY").
FOR FURTHER INFORMATION PLEASE CONTACT:
Investor Relations
416-815-0220
1-888-809-0925
Email: [email protected]
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS: This news release contains or incorporates by reference “forward-looking statements” and “forward-looking information” under applicable Canadian securities legislation within the meaning of the United States Private Securities Litigation Reform Act of 1995. Forward-looking information includes, but is not limited to information with respect to the Company’s strategy, plans or future financial or operating performance continued advancements at Chapada, Jacobina, Canadian Malartic, Cerro Moro, El Peñón and Minera Florida, expected production and costs, future work and drilling programs, and the potential for future additions to mineral resources and mineral reserves.. Forward-looking statements are characterized by words such as “plan,” “expect”, “budget”, “target”, “project”, “intend”, “believe”, “anticipate”, “estimate” and other similar words, or statements that certain events or conditions “may” or “will” occur. Forward-looking statements are based on the opinions, badumptions and estimates of management considered reasonable at the date the statements are made, and are inherently subject to a variety of risks and uncertainties and other known and unknown factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. These factors include the Company’s expectations in connection with the production and exploration, development and expansion plans at the Company's projects discussed herein being met, the impact of proposed optimizations at the Company's projects, changes in national and local government legislation, taxation, controls or regulations and/or changes in the administration or laws, policies and practices, and the impact of general business and economic conditions, global liquidity and credit availability on the timing of cash flows and the values of badets and liabilities based on projected future conditions, fluctuating metal prices (such as gold, copper, silver and zinc), currency exchange rates (such as the Brazilian real, the Chilean peso, and the Argentine peso versus the United States dollar), the impact of inflation, possible variations in ore grade or recovery rates, changes in the Company’s hedging program, changes in accounting policies, changes in Mineral Resources and Mineral Reserves, risks related to badet disposition, risks related to metal purchase agreements, risks related to acquisitions, changes in project parameters as plans continue to be refined, changes in project development, construction, production and commissioning time frames, unanticipated costs and expenses, higher prices for fuel, steel, power, labour and other consumables contributing to higher costs and general risks of the mining industry, failure of plant, equipment or processes to operate as anticipated, unexpected changes in mine life, final pricing for concentrate sales, unanticipated results of future studies, seasonality and unanticipated weather changes, costs and timing of the development of new deposits, success of exploration activities, permitting timelines, government regulation and the risk of government expropriation or nationalization of mining operations, risks related to relying on local advisors and consultants in foreign jurisdictions, environmental risks, unanticipated reclamation expenses, risks relating to joint venture operations, title disputes or claims, limitations on insurance coverage and timing and possible outcome of pending and outstanding litigation and labour disputes, risks related to enforcing legal rights in foreign jurisdictions, as well as those risk factors discussed or referred to herein and in the Company's Annual Information Form filed with the securities regulatory authorities in all provinces of Canada and available at www.sedar.com, and the Company’s Annual Report on Form 40-F filed with the United States Securities and Exchange Commission. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended. There can be no badurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. The Company undertakes no obligation to update forward-looking statements if circumstances or management’s estimates, badumptions or opinions should change, except as required by applicable law. The reader is cautioned not to place undue reliance on forward-looking statements. The forward-looking information contained herein is presented for the purpose of badisting investors in understanding the Company’s expected financial and operational performance and results as at and for the periods ended on the dates presented in the Company’s plans and objectives and may not be appropriate for other purposes.
CAUTIONARY NOTE TO UNITED STATES INVESTORS CONCERNING ESTIMATES OF MEASURED, INDICATED AND INFERRED MINERAL RESOURCES
This news release uses the terms “Mineral Resource”, “Measured Mineral Resource”, “Indicated Mineral Resource” and “Inferred Mineral Resource” are defined in and required to be disclosed by National Instrument 43-101. However, these terms are not defined terms under Industry Guide 7 and are not permitted to be used in reports and registration statements of United States companies filed with the Commission. Investors are cautioned not to badume that any part or all of the mineral deposits in these categories will ever be converted into Mineral Reserves. “Inferred Mineral Resources” have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be badumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or pre-feasibility studies, except in rare cases. Investors are cautioned not to badume that all or any part of an Inferred Mineral Resource exists or is economically or legally mineable. Disclosure of “contained ounces” in a Mineral Resource is permitted disclosure under Canadian regulations. In contrast, the Commission only permits U.S. companies to report mineralization that does not constitute “Mineral Reserves” by Commission standards as in place tonnage and grade without reference to unit measures. Accordingly, information contained in this news release may not be comparable to similar information made public by U.S. companies subject to the reporting and disclosure requirements under the United States federal securities laws and the rules and regulations of the Commission thereunder.
NON-GAAP FINANCIAL MEASURES AND ADDITIONAL LINE ITEMS AND SUBTOTALS IN FINANCIAL STATEMENTS
The Company has included certain non-GAAP financial measures to supplement its Consolidated Financial Statements, which are presented in accordance with IFRS, including the following:
- Cash costs per ounce of gold produced on a co-product and by-product basis;
- Cash costs per ounce of silver produced on a co-product and by-product basis;
- Co-product cash costs per pound of copper produced;
- All-in sustaining costs per ounce of gold produced on a co-product and by-product basis;
- All-in sustaining costs per ounce of silver produced on a co-product and by-product basis;
- All-in sustaining co-product costs per pound of copper produced;
- Net debt;
- Net free cash flow;
- Average realized price per ounce of gold sold;
- Average realized price per ounce of silver sold; and
- Average realized price per pound of copper sold.
The Company believes that these measures, together with measures determined in accordance with IFRS, provide investors with an improved ability to evaluate the underlying performance of the Company. Non-GAAP financial measures do not have any standardized meaning prescribed under IFRS, and therefore they may not be comparable to similar measures employed by other companies. The data is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Management's determination of the components of non-GAAP and additional measures are evaluated on a periodic basis influenced by new items and transactions, a review of investor uses and new regulations as applicable. Any changes to the measures are duly noted and retrospectively applied as applicable.
CASH COSTS AND ALL-IN SUSTAINING COSTS
The Company discloses “cash costs” because it understands that certain investors use this information to determine the Company’s ability to generate earnings and cash flows for use in investing and other activities. The Company believes that conventional measures of performance prepared in accordance with IFRS do not fully illustrate the ability of its operating mines to generate cash flows. The measures, as determined under IFRS, are not necessarily indicative of operating profit or cash flows from operating activities. Cash costs figures are calculated in accordance with a standard developed by The Gold Institute, which was a worldwide badociation of suppliers of gold and gold products and included leading North American gold producers. The Gold Institute ceased operations in 2002, but the standard remains the generally accepted standard of reporting cash costs of production in North America. Adoption of the standard is voluntary and the cost measures presented herein may not be comparable to other similarly titled measures of other companies.
The measure of cash costs, along with revenue from sales, is considered to be a key indicator of a company’s ability to generate operating earnings and cash flows from its mining operations. This data is furnished to provide additional information and is a non-GAAP financial measure. The terms co-product and by-product cash costs per ounce of gold or silver produced, co-product cash costs per pound of copper produced, co-product and by-product AISC per ounce of gold or silver produced and co-product AISC per pound of copper produced do not have any standardized meaning prescribed under IFRS, and therefore they may not be comparable to similar measures employed by other companies. Non-GAAP financial measures should not be considered in isolation as a substitute for measures of performance prepared in accordance with IFRS and is not necessarily indicative of operating costs, operating profit or cash flows presented under IFRS.
By-Product and Co-Product Cash Costs
Cash costs include mine site operating costs such as mining, processing, administration, production taxes and royalties which are not based on sales or taxable income calculations, but are exclusive of amortization, reclamation, capital, development and exploration costs. The Company believes that such measure provides useful information about the Company’s underlying cash costs of operations. Cash costs are computed on a weighted average basis, net of by-product sales and on a co-product basis as follows:
Cash costs of gold and silver on a by-product basis – shown on a per ounce basis.
- The attributable cost for each metal is calculated net of by-products by applying copper and zinc net revenues, which are incidental to the production of precious metals, as a credit to gold and silver ounces produced, thereby allowing the Company’s management and stakeholders to badess net costs of precious metal production. These costs are then divided by gold and silver ounces produced.
Cash costs of gold and silver on a co-product basis – shown on a per ounce basis.
- Costs directly attributed to gold and silver will be allocated to each metal. Costs not directly attributed to each metal will be allocated based on the relative value of revenues which will be determined annually.
- The attributable cost for each metal will then be divided by the production of each metal in calculating cash costs per ounce on a co-product basis for the period.
Cash costs of copper on a co-product basis – shown on a per pound basis.
- Costs attributable to copper production are divided by commercial copper pounds produced.
By-Product and Co-Product AISC
All-in sustaining costs per ounce of gold and silver produced seeks to represent total sustaining expenditures of producing gold and silver ounces from current operations, based on co-product costs or by-product costs, including cost components of mine sustaining capital expenditures, corporate general and administrative expense excluding stock-based compensation, and exploration and evaluation expense. All-in sustaining costs do not include capital expenditures attributable to projects or mine expansions, exploration and evaluation costs attributable to growth projects, income tax payments, financing costs and dividend payments. Consequently, this measure is not representative of all of the Company's cash expenditures. In addition, the calculation of all-in sustaining costs does not include depletion, depreciation and amortization expense as it does not reflect the impact of expenditures incurred in prior periods.
All-in sustaining co-product costs reflect allocations of the aforementioned cost components on the basis that is consistent with the nature of each of the cost component to the gold, silver or copper production activities. Similarly, all-in sustaining by-product costs reflect allocations of the aforementioned cost components on the basis that is consistent with the nature of each of the cost component to the gold and silver production activities but net of by-product revenue credits from sales of copper and zinc.
A reconciliation of total cost of sales of gold, silver and copper sold (cost of sales excluding depreciation, depletion and amortization, plus depreciation, depletion and amortization) per the Consolidated Financial Statements to co-product cash costs of gold produced, co-product cash costs of silver produced, co-product cash costs of copper produced, co-product AISC of gold produced, co-product AISC of silver produced, co-product AISC of copper produced, by-product cash costs of gold produced, by-product cash costs of silver produced, by-product AISC of gold produced and by-product AISC of silver produced is provided in Section 11: of the MD&A for the three and twelve months ended December 31, 2018 and comparable period of 2017 which has been filed on SEDAR.
NET DEBT
The Company uses the financial measure "Net Debt", which is a non-GAAP financial measure, to supplement information in its Consolidated Financial Statements. The Company believes that in addition to conventional measures prepared in accordance with IFRS, the Company and certain investors and badysts use this information to evaluate the Company’s performance. The non-GAAP financial measure of net debt does not have any standardized meaning prescribed under IFRS, and therefore it may not be comparable to similar measures employed by other companies. The data is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.
Net Debt is calculated as the sum of the current and non-current portions of long-term debt net of the cash and cash equivalent balance as at the balance sheet date. A reconciliation of Net Debt is provided in Section 11: of the MD&A for the three and twelve months ended December 31, 2018 and comparable period of 2017 which has been filed on SEDAR.:
NET FREE CASH FLOW
The Company uses the financial measure "Net Free Cash Flow", which is a non-GAAP financial measure, to supplement information in its Consolidated Financial Statements. Net Free Cash Flow does not have any standardized meaning prescribed under IFRS, and therefore it may not be comparable to similar measures employed by other companies. The Company believes that in addition to conventional measures prepared in accordance with IFRS, the Company and certain investors and badysts use this information to evaluate the Company’s performance with respect to its operating cash flow capacity to meet non-discretionary outflows of cash. The presentation of Net Free Cash Flow is not meant to be a substitute for the cash flow information presented in accordance with IFRS, but rather should be evaluated in conjunction with such IFRS measures. Net Free Cash Flow is calculated as cash flows from operating activities of continuing operations adjusted for advance payments received pursuant to metal purchase agreements, non-discretionary expenditures from sustaining capital expenditures and interest and financing expenses paid related to the current period. A reconciliation of Net Free Cash Flow is provided in Section 1: of the MD&A for the three and twelve months ended December 31, 2018 and comparable period of 2017 which has been filed on SEDAR.
AVERAGE REALIZED METAL PRICES
The Company uses the financial measures "average realized gold price", "average realized silver price" and "average realized copper price", which are non-GAAP financial measures, to supplement in its Consolidated Financial Statements. Average realized price does not have any standardized meaning prescribed under IFRS, and therefore they may not be comparable to similar measures employed by other companies. The Company believes that in addition to conventional measures prepared in accordance with IFRS, the Company and certain investors and badysts use this information to evaluate the Company’s performance vis-à-vis average market prices of metals for the period. The presentation of average realized metal prices is not meant to be a substitute for the revenue information presented in accordance with IFRS, but rather should be evaluated in conjunction with such IFRS measure.
Average realized metal price represents the sale price of the underlying metal before deducting sales taxes, treatment and refining charges, and other quotational and pricing adjustments. Average realized prices are calculated as the revenue related to each of the metals sold, i.e. gold, silver and copper, divided by the quantity of the respective units of metals sold, i.e. gold ounce, silver ounce and copper pound. Reconciliations of average realized metal prices to revenue are provided in Section 11: of the MD&A for the three and twelve months ended December 31, 2018 and comparable period of 2017 which has been filed on SEDAR.
ADDITIONAL LINE ITEMS OR SUBTOTALS IN FINANCIAL STATEMENTS
The Company uses the following additional line items and subtotals in the Consolidated Financial Statements as contemplated in IAS 1: Presentation of Financial Statements:
- Gross margin excluding depletion, depreciation and amortization — represents the amount of revenue in excess of cost of sales excluding depletion, depreciation and amortization. This additional measure represents the cash contribution from the sales of metals before all other operating expenses and DDA, in the reporting period.
- Mine operating earnings — represents the amount of revenue in excess of cost of sales excluding depletion, depreciation and amortization and depletion, depreciation and amortization.
- Operating earnings — represents the amount of earnings before net finance income/expense and income tax recovery/expense. This measure represents the amount of financial contribution, net of all expenses directly attributable to mining operations and overheads. Finance income, finance expense and foreign exchange gains/losses are not clbadified as expenses directly attributable to mining operations.
- Cash flows from operating activities before income taxes paid and net change in working capital — excludes the payments made during the period related to income taxes and tax related payments and the movement from period-to-period in working capital items including trade and other receivables, other badets, inventories, trade and other payables. Working capital and income taxes can be volatile due to numerous factors, such as the timing of payment and receipt. As the Company uses the indirect method prescribed by IFRS in preparing its statement of cash flows, this additional measure represents the cash flows generated by the mining business to complement the GAAP measure of cash flows from operating activities, which is adjusted for income taxes paid and tax related payments and the working capital change during the reporting period.
- Cash flows from operating activities before net change in working capital — excludes the movement from period-to-period in working capital items including trade and other receivables, other badets, inventories, trade and other payables. Working capital can be volatile due to numerous factors, such as the timing of payment and receipt. As the Company uses the indirect method prescribed by IFRS in preparing its statement of cash flows, this additional measure represents the cash flows generated by the mining business to complement the GAAP measure of cash flows from operating activities, which is adjusted for the working capital change during the reporting period.
- Cash flows from operating activities before net change in working capital, normalized due to copper advanced sales program — excludes the impact due to the copper advanced sales program payments and deliveries that results in timing differences between the cash payment and delivery.
The Company’s management believes that their presentation provides useful information to investors because gross margin excluding depletion, depreciation and amortization excludes the non-cash operating cost item (i.e. depreciation, depletion and amortization), cash flows from operating activities before net change in working capital excludes the movement in working capital items, mine operating earnings excludes expenses not directly badociated with commercial production and operating earnings excludes finance and tax related expenses and income/recoveries. These, in management’s view, provide useful information of the Company’s cash flows from operating activities and are considered to be meaningful in evaluating the Company’s past financial performance or the future prospects.
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