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Mangazeya Mining Announces Filing of 3Q 2020 Financial Statements, MD&A Quarterly Highlights
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December 3, 2020 - 9:28 am
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Mangazeya Mining Announces Filing of 3Q 2020 Financial Statements, MD&A Quarterly Highlights

 

Publish date: 30.11.2020
TORONTO, ONTARIO, November 30, 2020 – Mangazeya Mining Ltd. (“Mangazeya” or the “Company”) (NEX: MGZ.H) announced the filing of its unaudited interim condensed financial statements (“Financial Statements”) and the interim management’s discussion and analysis (“MD&A”) – quarterly highlights (“QH”) for the third quarter and nine months ended September 30, 2020. All figures are quoted in Canadian dollars unless otherwise indicated.

Third quarter and nine months 2020 highlights:

 

  3Q 2020 3Q 2019 Change % 9M 2020 9M 2019 Change %
Operational highlights
Gold production, ounces 20,088 17,643 2,445 13.9% 34,234 26,728 7,506 28,1%
Refining gold, ounces 17,690 19,521 (1,831) (9.4%) 29,663 26,315 3,348 12,7%
Gold sales, ounces 17,482 16,360 1,122 6.9% 31,004 22,386 8,618 38,5%
Ore mined, tones 379,187 493,584 (114,397) (23.2%) 1,041,176 1,031,815 9,361 0,9%
Stripping ratio, m3/t 2.03 1.41 0.62 43.9% 1.93 1.65 0,28 17,2%
Ore processed, tones 561,177 393,025 168,152 42.8% 1,014,033 804,76 209,270 26,0%
Ore grade in ore processed, g/t 1.45 1.95 (0,50) (25.7%) 1.47 1.78 (0.31) (17,4%)
Financial highlights
Revenue 45,746 32,191 13,555 42,1% 75,274 42,782 32,492 75,9%
Adjusted EBITDA 22,411 13,895 8,516 61,3% 33,464 10,394 23,070 222,0%
Total cash cost per ounce Savkino (TCC), CAD 1,283 1,597 (314) (19,6%) 1,452 1,520 (68) (4,5%)
Total cash cost per ounce Savkino (TCC), CAD 1,283 1,597 (314) (19,6%) 1,452 1,520 (68) (4,5%)
Total cash cost per ounce Nasedkino (TCC), CAD 1,229 1,229 1,229 1,229
Average gold price, CAD 2,617 1,968 649 33,0% 2,428 1,911 517 27,0%
Cash balance 30,834 7,445 23,389 314,2% 30,834 7,445 (23,389) 314,2%
Cash flow from operating activities before changes in working capital 21,230 (58,287) 79,517 (136,4%) 30,903 (66,185) (97,088) (146,7%)
Cash flow from investing activities (15,908) (8,736) (7,172) 82,1% (39,288) (40,823) 1,535 (3,8%)
Cash flow from financing activities 6,144 78,940 (72,796) (92,2%) 51,690 132,156 (80,466) (60,9%)

 

  • The revenue for the 3Q and 9 months of 2020 increased by 42% and 76% respectively compared to 3Q and 9 months 2019 due to higher sales price as well as increase in sales volumes as a result of the start of sales of gold produced at Nasedkino deposit and the increase in sales at Kochkovskoye deposit.
  • Gold production in 3Q of 2020 increased from 17.6k ounces to 20.1k ounces YoY, and in 9 months 2020 from 26.7k ounces to 34.2k ounces YoY due to start of production at Nasedkino deposit.
    Savkinskoye deposit
    The production volume for 9 months 2020 was 4.8k ounces, which is 45% less than in the same period of the preceding year. In 3Q of 2020 1.7k ounces of gold were produced, which is 60% less than in the same period of the preceding year. The decrease is related to the completion of the deposit development.
    The sales volumes for 9 months 2020 decreased by 21% YoY. In 3Q 2020 the sales volumes decreased by 83%YoY. The decrease is attributed to the reduction in amount produced.
    TCC for 3Q 2020 decreased by 19.6% in comparison with 3Q 2019, mainly due to depreciation of ruble. TCC for 9M 2020 decreased by 4.5% in comparison with 9M 2019.
    Kochkovskoye deposit
    Gold production increased by 28% from 18.0k ounces in 9M 2019 to 23.2k ounces in 9M 2020, due to higher volumes of ore mined and stacked. In the 3Q 2020 and 3Q 2019 12.1 and 13.2k ounces of gold were produced respectively.
    Sales in 9 months 2020 increased by 39% in comparison with the same period of 2019, to the amount of 21.5k ounces. In 3Q 2020 and 3Q 2019 the sales were 12.7 and 12.2 k ounces respectively.
    TCC for 3Q and 9 months of 2020 decreased by 18.1% and 30.9% respectively in comparison with 2019 mainly due to decrease of fixed cost share in the cost of sales structure and depreciation of ruble.
    Nasedkino deposit
    In 3Q 2020 6.2k ounces of gold were produced and 4.0k ounces of gold were sold.
     
  •  
  • The gross profit increased twice from $17.2 million in 3Q 2019 to $23.9 million in 3Q 2020 and from $20.0 million in 9 months 2019 to $40.0 million in 9 months 2020 due to higher revenue and decrease in TСC. The gross profit margin in 3Q and 9M 2020 is 52% and 53% respectively. The gross profit margin in 3Q and 9M 2019 were 54% and 47% respectively.
  • Administrative expenses in 3Q 2020 decreased by 33% compared to 3Q 2019, and by 12% in 9M 2020 YoY.
  • The company had a positive adjusted EBITDA of $22.4 million and $33.5 million in 3Q and 9 months of 2020. The adjusted EBITDA margin in 3Q and 9 months of 2020 was 49% and 44% respectively, mainly driven by higher sales.
  • The finance expenses in 9 months of 2020 increased by $54 million compared to 9 months of 2019, mainly because of the loss on repayment of the loan in gold, bank commissions on early debt repayment to VTB Bank (PJSC), as well as fair value measurement of the derivative financial instrument within the agreement with PJSC Bank “Finance Corporation “Otkrytie” (PJSC).
  • The loss on foreign exchange for 3Q and 9M of 2020 amounted to $35 and $43 million respectively due to depreciation of the ruble on revaluation of a foreign currency loan.
  • The company had a net loss for 3Q 2020 in the amount of $11.7 million compared to the net loss of $3.8 million for 3Q 2019, and a net loss for the 9 months of 2020 of $68.7 million compared to net loss for the 9 months of 2019 in the amount of $7.2 million.

Cash flow and capital resources:

 

  • For 3Q and 9 months 2020 the company had a positive cash flow received from operating activities before changes in working capital of $21.2 million and $30.9 million respectively.
  • The Company invested $15.9 million in 3Q 2020 and $39.2 million in 9 months of 2020 in property, plant and equipment and exploration and evaluation assets.
  • In 3Q and 9 months of 2020 the company had a net positive cash flow from financing activities in the amount of $6.1 and $51.6 million, representing settlement and receipt of funds under bank loan agreements.

The Financial Statement and MD&A are available on Mangazeya’s website at http://mangazeyamining.ru/ and have been filed on SEDAR at http://www.sedar.com.

About Mangazeya Mining Ltd.
Mangazeya Mining Ltd. is a NEX-listed mining and exploration company, focused on the development of mineral resources in the Russian Federation.

Contact:
Anton Grigoryev
Corporate Secretary
Mangazeya Mining Ltd.
a.grigoryev@mangazeya.ru

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