Golden Minerals Reports Second Quarter 2022 Results
Golden Minerals Company (NYSE American: AUMN) reported its financial results for the second quarter of 2022, showing revenue of $5.9 million and a net operating margin of $1.3 million. This marks a decrease in net operating margin from $2.5 million in Q2 2021. The company recorded a net loss of $2.8 million or $0.02 per share, compared to a loss of $0.8 million in the previous year. Cash and equivalents totaled $9.5 million as of June 30, 2022. Ongoing mining activities at the Rodeo mine produced 3,004 gold ounces and 12,768 silver ounces, but cash costs rose to $1,426.1 per payable gold ounce due to lower grades.
- Rodeo mine continues to provide cash flow with production of 3,004 payable gold ounces and 12,768 payable silver ounces.
- Positive preliminary results from test mining activities at Velardeña support productivity advancements.
- Exploration programs at Yoquivo and Sarita Este show potential for economic mineralization.
- Net loss increased to $2.8 million in Q2 2022, up from $0.8 million in Q2 2021.
- Cash costs per payable gold ounce rose significantly to $1,426.1 from $1,164 in Q1 2022 due to lower ore grades and increased operational activity.
- Dilution issues in test mining at Velardeña did not meet expectations, potentially impacting future production plans.
Second Quarter Financial Results - Highlights
(All currency expressed in approximate USD)
-
Revenue of
$5.9 million $1.3 million $5.9 million $2.5 million Mexico . -
$9.5 million June 30, 2022 , compared to$12.2 million December 31, 2021 . -
Net loss of
$0.02 $2.8 million $0.00 $0.8 million
Second Quarter Business Summary
-
At the Rodeo mine, produced 3,004 payable gold ounces and 12,768 payable silver ounces (3,158 gold equivalent (“AuEq”) ounces) with total cash costs, net of silver by-product credits, per payable ounce of gold of
$1,426 $1,164 -
Sold 3,219 AuEq oz. in doré at average prices (before selling and refining costs) of
$1,865 $22.49 June 30, 2022 consisted of 323 payable oz. Au and 1,009 payable oz. Ag. - Continued limited scale test mining activities at the Velardeña Properties, conducted to complement final optimization of a bio-oxidation plant design and for use in additional flotation separation studies. Test results using the bio-oxidation pre-treatment oxidation process continue to support the use of the technology in future processing at Velardeña.
-
Conducted additional test mining at Velardeña beginning in
May 2022 using a new contractor to evaluate productivity and dilution of resue mining on the principal veins accessible from theSan Mateo decline. Results met expected productivity metrics but did not meet targeted dilution metrics for some of the veins mined. The Company is therefore continuing to evaluate modified mine plans and mining techniques to address dilution issues during the current downturn in gold and silver prices. -
In
July 2022 , completed a third drill program of 5,693 meters in 24 drill holes at theYoquivo gold-silver project located in Chihuahua State,Mexico . This drill program was conducted to further delineate previously encountered vein-hosted mineralized intervals. Complete assay results have not yet been received; however, the Company anticipates this round of drilling will provide sufficient information with which to estimate an initial gold-silver resource later in 2022. -
Completed a second drill program at the Sarita Este gold-copper project (
Salta Province ,Argentina ) inJune 2022 ; recently released assay results from the program point to a potentially economic shallow oxidized gold system. -
In
June 2022 , Barrick reported results of a 5-hole 1,300m initial drill program at our El Quevar property to the Company. Vuggy silica alteration, which is commonly associated with high sulfidation epithermal Au-Ag deposits, was noted in all holes. Final assay results are pending.
1 Gold equivalents are based on actual gold and silver prices realized during the second quarter 2022:
Golden’s President and Chief Executive Officer,
Second Quarter 2022 Financial Results
The Company reported revenue of
Twelve-Month Financial Outlook
The Company ended the second quarter of 2022 with a cash balance of
Currently forecasted expenditures during the 12 months ending
-
$5.1 million Mexico ,Argentina andNevada , including project assessment and evaluation costs relating to additional exploration at Rodeo andYoquivo , as well as costs associated with the potential restart of Velardeña; -
$1.0 million -
$0.4 million -
$3.9 million
Additional information regarding second quarter 2022 financial results can be found in the Company’s 10-Q Quarterly Report which is available on the
Quarterly Conference Call and Webcast
Management will be hosting a conference call and webcast on
The webcast will also be available for replay on the
About
Financial Statements
CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||||
(US Dollars, unaudited) |
||||||||
2021 |
||||||||
2022 |
(Restated)* | |||||||
| (in thousands, except share data) | ||||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 9,517 |
|
$ | 12,229 |
|
||
| Short-term investments | 53 |
|
67 |
|
||||
| Inventories, net | 1,785 |
|
1,608 |
|
||||
| Value added tax receivable, net | 1,670 |
|
1,290 |
|
||||
| Prepaid expenses and other assets | 1,168 |
|
1,145 |
|
||||
| Total current assets | 14,193 |
|
16,339 |
|
||||
| Property, plant and equipment, net | 6,479 |
|
6,627 |
|
||||
| Other long-term assets | 646 |
|
747 |
|
||||
| Total assets | $ | 21,318 |
|
$ | 23,713 |
|
||
| Liabilities and Equity | ||||||||
| Current liabilities | ||||||||
| Accounts payable and other accrued liabilities | $ | 4,097 |
|
$ | 3,509 |
|
||
| Deferred revenue | 719 |
|
1,469 |
|
||||
| Other current liabilities | 441 |
|
721 |
|
||||
| Total current liabilities | 5,257 |
|
5,699 |
|
||||
| Asset retirement and reclamation liabilities | 3,739 |
|
3,569 |
|
||||
| Other long-term liabilities | 189 |
|
353 |
|
||||
| Total liabilities | 9,185 |
|
9,621 |
|
||||
| Commitments and contingencies | ||||||||
| Equity | ||||||||
| Common stock, |
1,674 |
|
1,628 |
|
||||
| Additional paid in capital | 541,642 |
|
540,518 |
|
||||
| Accumulated deficit | (531,183 |
) |
(528,054 |
) |
||||
| Shareholders' equity | 12,133 |
|
14,092 |
|
||||
| Total liabilities and equity | $ | 21,318 |
|
$ | 23,713 |
|
||
* See Note 3, “Notes to the Condensed Consolidated Financial Statements” in the Form 10-Q.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||||||||||
(US dollars, unaudited) |
||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||
2022 |
|
2021 |
|
2022 |
|
2021 |
|
|||||||||
| (in thousands except per share data) | (in thousands, except per share data) | |||||||||||||||
| Revenue: | ||||||||||||||||
| Sale of metals | $ | 5,926 |
|
$ | 5,861 |
|
$ | 13,432 |
|
$ | 7,639 |
|
||||
| Total revenue | 5,926 |
|
5,861 |
|
13,432 |
|
7,639 |
|
||||||||
| Costs and expenses: | ||||||||||||||||
| Cost of metals sold (exclusive of depreciation shown below) | (4,639 |
) |
(3,328 |
) |
(8,961 |
) |
(4,864 |
) |
||||||||
| Exploration expense | (2,799 |
) |
(1,094 |
) |
(4,662 |
) |
(1,875 |
) |
||||||||
| El Quevar project expense | (177 |
) |
(53 |
) |
(294 |
) |
(159 |
) |
||||||||
| Velardeña care and maintenance costs | (134 |
) |
(141 |
) |
(473 |
) |
(340 |
) |
||||||||
| Administrative expense | (1,275 |
) |
(992 |
) |
(2,548 |
) |
(2,540 |
) |
||||||||
| Stock based compensation | (200 |
) |
(987 |
) |
(349 |
) |
(1,416 |
) |
||||||||
| Reclamation expense | (71 |
) |
(63 |
) |
(140 |
) |
(129 |
) |
||||||||
| Other operating income (expense), net | 502 |
|
135 |
|
890 |
|
334 |
|
||||||||
| Depreciation and amortization | (87 |
) |
(168 |
) |
(152 |
) |
(323 |
) |
||||||||
| Total costs and expenses | (8,880 |
) |
(6,691 |
) |
(16,689 |
) |
(11,312 |
) |
||||||||
| Loss from operations | (2,954 |
) |
(830 |
) |
(3,257 |
) |
(3,673 |
) |
||||||||
| Other income (expense): | ||||||||||||||||
| Interest and other expense, net | (36 |
) |
(15 |
) |
(14 |
) |
(323 |
) |
||||||||
| Gain (loss) on foreign currency transactions | 48 |
|
102 |
|
98 |
|
23 |
|
||||||||
| Total other income (loss) | 12 |
|
87 |
|
84 |
|
(300 |
) |
||||||||
| Loss from operations before income taxes | (2,942 |
) |
(743 |
) |
(3,173 |
) |
(3,973 |
) |
||||||||
| Income taxes | 129 |
|
(67 |
) |
44 |
|
(15 |
) |
||||||||
| Net Loss | $ | (2,813 |
) |
$ | (810 |
) |
$ | (3,129 |
) |
$ | (3,988 |
) |
||||
| Net income (loss) per common share — basic | ||||||||||||||||
| Loss | $ | (0.02 |
) |
$ | - |
|
$ | (0.02 |
) |
$ | (0.02 |
) |
||||
| Weighted average Common Stock outstanding - basic (1) | 165,109,309 |
|
162,365,584 |
|
163,817,471 |
|
161,382,645 |
|
||||||||
Non-GAAP Financial Measures
“Total cash costs, net of by-product credits, per payable gold ounce,” is a non-GAAP measure, and includes all direct and indirect operating cash costs associated with the physical activities that would generate doré products for sale to customers, including mining to gain access to mineralized materials, mining of mineralized materials and waste, milling, third-party related treatment, refining and transportation costs, on-site administrative costs and royalties. Total cash costs do not include depreciation, depletion, amortization, exploration expenditures, reclamation and remediation costs, sustaining capital, financing costs, income taxes, or corporate general and administrative costs not directly or indirectly related to the Rodeo project. By-product credits include revenues from silver contained in the products sold to customers during the period. “Total cash costs, net of by-product credits”, are divided by the number of payable gold ounces generated by the plant for the period to arrive at “Total cash costs, net of by-product credits, per payable gold ounce.”
“Cost of metals sold”, reported as a separate line item in the Company’s Condensed Consolidated Statements of Operations for the three months and six months ended
| Reconciliation of Costs of Metals Sold (GAAP) to Total Cash Costs, net of By-product Credits (Non-GAAP) |
||||
| (in thousands) | ||||
| Three Months Ended |
||||
| Total cash costs, net of by-product credits | $ | 4,284 |
|
|
| Reconciliation to GAAP measure: | ||||
| Treatment and refining costs | $ | (83 |
) |
|
| Silver by-product credits | 296 |
|
||
| Write down of inventories to net realizable value | — |
|
||
| Change in inventory (excluding depreciation, depletion and amortization) | 142 |
|
||
| Cost of metals sold | $ | 4,639 |
|
|
| Six Months Ended |
||||
| Total cash costs, net of by-product credits | $ | 8,485 |
|
|
| Reconciliation to GAAP measure: | ||||
| Treatment and refining costs | $ | (212 |
) |
|
| Silver by-product credits | 647 |
|
||
| Write down of inventories to net realizable value | — |
|
||
| Change in inventory (excluding depreciation, depletion and amortization) | 41 |
|
||
| Cost of metals sold | $ | 8,961 |
|
|
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended, and applicable Canadian securities legislation, including statements regarding the possibility of estimating an initial gold-silver resource in 2022 at the
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FAQ
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