Revett Minerals Reports 2011 Financial Results
SPOKANE VALLEY, WASHINGTON -- (Marketwire) -- 03/28/12 -- Revett Minerals Inc. (NYSE Amex: RVM) (TSX: RVM) ("Revett" or the "Company") is pleased to announce its consolidated operating and financial results for the year ended December 31, 2011. The financial results are based on US GAAP unless otherwise indicated and all currencies are in United States dollars unless otherwise indicated.
Highlights for the year ended December 31, 2011 include:
-- Net cash from operations (1) was $28.2 million, an increase of 131% over
2010 net cash from operations of $12.2 million. Record net income for
the year was $13.5 million, or $0.36 per share.
-- Record silver production of 1.29 million ounces and copper production of
10.65 million pounds were 28% and 21% higher than in 2010. Also achieved
record mill throughput at the Troy Mine, averaging 3,957 tons per day.
-- Replaced reserves equivalent to 100% of Troy Mine annual production,
resulting in a seven year mine life at current production rates.
-- Strong safety performance. The 2011 MSHA calculated incidence rate for
the Troy Mine was 0.53 compared to the national underground hardrock
mine average rate of 2.22.
-- Established a $20 million revolving credit facility with Societe
Generale. The facility, if needed, will potentially be used for I Bed
development at the Troy Mine and/or Phase I development at Rock Creek.
-- Received an affirmative decision from the United States Court of Appeals
for the Ninth Circuit relating to the Rock Creek project. The Court
affirmed the US Fish and Wildlife Service's determination that the mine
would not adversely modify bull trout and grizzly bear critical habitat
and did not violate the Endangered Species Act (ESA).
-- Expanded our land position adjacent to and northwest of the Rock Creek
project's claims group through both the acquisition and staking of
unpatented claims. In total, approximately 4,100 acres were added to the
Company's property position at Rock Creek.
-- Completed a listing of the Company's shares on the NYSE Amex in May
2011; the combined average U.S. (Amex) and Canadian (TSX) daily trading
volume since the listing has been over 150,000 shares per day.
Consolidated Financial Results
Total revenue for 2011 increased by 49% to $70.1 million compared to $47.0 million during 2010. Net income for the year was $13.5 million or $0.36 per share, compared to a net loss of $0.6 million or $(0.02) per share for 2010. The increase in 2011 revenues was due to higher overall production along with significantly higher prices of silver and copper as compared to 2010.
Cost of sales increased in 2011 by 23% compared to 2010. This increase was primarily due to higher mill throughput along with increased labor costs, a 4% increase in treatment and refining costs, increased health and general insurance costs, and higher royalty and mining taxes due to significantly increased revenues.
At December 31, 2011, cash and short term investments were $25.2 million, compared to $8.8 million at December 31, 2010.
Selected Financial Highlights:
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2011 2010 Change
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Net Cash from Operations (1) $ 28.2m $ 12.2m 131%
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Revenue $ 70.1m $ 47.0m 49%
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Working Capital $ 28.0m $ 10.6m 164%
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Net Income (before deferred taxes) $ 17.5m $ (0.6m)
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Net Income $ 13.5m $ (0.6m)
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EPS (basic) 0.36 (0.02)
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EPS (fully diluted) 0.31 (0.02)
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Cash & short term investments $ 25.2m $ 8.8m 186%
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(1) Net cash from operations is before capital expenditures and exploration and was previously reported on January 23, 2012 to be $29.2 million. This is a non GAAP measure. The Company believes that net cash from operations is a benchmark for performance and is well understood and widely reported in the mining industry.
Troy Operating Summary
The Troy Mine achieved record mill throughput in 2011 of 1,416,572 tons which was approximately 4% higher than in 2010. Record silver production of 1.29 million ounces and copper production of 10.65 million pounds were 28% and 21% respectively higher than in 2010.
Selected Operating Highlights:
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2011 2010 Change
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Tons milled 1,416,572 1,362,890 4%
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Tons milled per day 3,957 3,807
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Copper Grade 0.46% 0.40% 15%
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Copper Recovery 82.02% 81.16%
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Copper Production (pounds) 10,651,494 8,794,445 21%
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Copper Sold (payable pounds) 10,157,018 8,499,831 19%
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Silver Grade (ounces per ton) 1.07 0.87 23%
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Silver Recovery 84.85% 85.05%
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Silver Production (ounces) 1,291,009 1,008,089 28%
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Silver Sold (payable ounces) 1,136,843 927,422 23%
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Troy Mine Operating Costs and Inventory
The table below summarizes final cash costs and concentrate inventory for the full year ended December 31, 2011.
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Cash Cost(2) Q1 Q2 Q3 Q4 2011
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Direct Operating Cost
(US$/st) $ 33.23 $ 30.21 $ 29.02 $ 29.89 $ 30.41
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By-Product Basis
(payable)(3)
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- Silver (US$/oz) or, $ 12.26 $ 3.34 $ 4.34 $ 2.37 $ 5.14
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- Copper (US$/lb) $ 2.05 $ 0.73 $ 0.71 $ 0.71 $ 0.97
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Co-Product Basis
(payable)(3)
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- Silver (US$/oz) and, $ 19.80 $ 16.25 $ 15.19 $ 19.92 $ 17.49
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- Copper (US$/lb) $ 2.76 $ 1.93 $ 1.87 $ 2.61 $ 2.21
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Concentrate Inventory
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- Dry Short Tons 495 1,042 1,662 457 457
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Net Cash from
Operations(1) $ 3.4m $ 7.3m $ 8.3m $ 9.2m $ 28.2m
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1. Net cash from operations is before capital expenditures and exploration
and is a non GAAP measure. The Company believes that net cash from
operations is a benchmark for performance and is well understood and widely
reported in the mining industry.
2. All cash costs include direct mine site costs and smelting, refining and
transport costs. Average commodity prices used to off-set (by-product
credit basis) or allocate (co-product basis) cash costs are the monthly
weighted average realized prices based on invoiced shipments. Cash costs
per payable ounce of silver or payable pound of copper is a non GAAP
measure. The Company believes that, in addition to cost of sales, cash
costs per ounce and per pound are a useful and complementary benchmark for
performance and is well understood and widely reported in the mining
industry. However, cash costs per ounce or per pound does not have a
standardized meaning prescribed by US GAAP. Investors are cautioned that
cash costs per ounce or per pound should not be construed as an alternative
to cost of sales determined in accordance with US GAAP as an indicator of
performance. The Company's method of calculating cash costs per ounce or
per pound may differ from the methods used by other entities and,
accordingly, the Company's cash costs per ounce or per pound may not be
comparable to similarly titled measures used by other entities.
3. Average commodity prices used to off-set (by-product credit basis) or
allocate (co-product basis) cash costs are the quarterly weighted averages
from the London Metals Exchange for copper or the London Daily Fix for
silver.
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Rock Creek
We are working to complete a Supplemental EIS on the Rock Creek Project to address some NEPA related issues as directed by the Federal District Court in May 2010. On November 16, 2011, we received a critical decision from the Ninth Circuit Court of Appeals affirming the prior District Court's favorable ruling regarding challenges brought under the Endangered Species Act (ESA).
In March 2011, the Company purchased a 2% net smelter royalty on future Rock Creek production that was previously owned by Kennecott. The Company issued 275,000 common shares at a fair market value of approximately $1.2 million to acquire this royalty interest.
We also significantly expanded our property position at Rock Creek by about 4,100 acres through the acquisition of 8 unpatented claims (the JE claims) and staking of an additional 200 lode claims (the Lost Girl claims) providing an enhanced strategic land position. These claims are located to the northwest of our existing project land position. Prior exploration core drilling conducted on the JE claims indicated copper and silver mineralization adjacent to Rock Creek prompting our acquisition of these claims.
John Shanahan, President and CEO noted, "2011 was a very, very successful year. We once again made steady progress towards our long term objective of becoming a significant producer of silver and copper in the USA. Operating cash flow at Troy, which was in excess of $28 million, is a remarkable accomplishment, as was our safety record and overall operating performance. The Troy Mine provides an all important bridge to Rock Creek and we remain thankful for the wonderful efforts of our employees and management team."
As previously announced, a conference call to discuss 2011 financial results is scheduled for Thursday, March 29, 2010 at 11:30 am (Eastern Daylight Time). To participate in the call, please dial 1 (888) 231-8191 or 1 (647) 427-7450, approximately five to ten minutes prior to the scheduled start time of the call. The conference call and all questions and answers will be recorded and made available until April 5, 2012. To listen to the recording, call toll free 1 (855) 859-2056 or 1 (416) 849-0833 and enter the access code 60599312#.
About Revett
Revett, through its subsidiaries, owns and operates the currently producing Troy Mine in Lincoln County, Montana and development-stage Rock Creek Project located in Sanders County, Montana, USA. The proven reserves at the Troy Mine and significant resources at the Rock Creek project form the basis of our plan to become a premier mid-tier base and precious metals producer. Revett plans on expanding production through exploration in and around its current properties, as well as through targeted business combinations of advanced stage projects.
John Shanahan, President & CEO
Except for the statements of historical fact contained herein, the information presented in this press release may contain "forward-looking information" within the meaning of applicable Canadian securities legislation and "forward-looking statements" within the meaning of The Private Securities Litigation Reform Act of 1995. Generally, these forward looking statements can be identified by the use of forward-looking terminology such as "expects", or "does not expect", "is expected", "is not expected", "budget", "plans", "schedule", "estimates", "forecasts", "intends", "anticipates", "or does not anticipate" or "believes" or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will", "occur" or "be achieved". Forward-looking statements contained in this press release include but are not limited to statements with respect to estimated mine life, potential uses of the revolving credit facility for development work and long term objectives. Actual results and developments could be affected by development risks and production risks at the Troy Mine, additional legal challenges and permitting for the Rock Creek project as well as those factors discussed in the section entitled "Risk Factors" in the Form 10-K filed on SEDAR at www.sedar.com and with the SEC on EDGAR. Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements. Revett does not undertake to update any forward-looking statements except as required under applicable securities laws.
Contacts:
Revett Minerals Inc.
Monique Hayes
Corporate Secretary/Director Investor Relations
(509) 921-2294
www.revettminerals.com
