GOLDEN, Colo., May 02, 2019 (GLOBE NEWSWIRE) -- Golden Minerals Company (“Golden Minerals”, “Golden” or the “Company”) (NYSE American and TSX: AUMN) today announced financial results and a business summary for the quarter ending March 31, 2019.
First Quarter Summary Financial Results
- Revenue of (approximately US) $1.9 million and a net operating margin (oxide plant lease revenue less lease costs) of $1.3 million related to the lease of the Company’s oxide plant in the first quarter 2019, compared to a $1.1 million net operating margin realized in the first quarter 2018.
- Other operating income of $0.1 million compared to $1.2 million in the year ago period, with the latter including $1.0 million received for extending an option on a formerly-held Mexican property.
- Exploration expenses of $0.9 million, unchanged from the year ago period.
- Net loss of $2.4 million or $0.02 per share in the first quarter 2019, compared to a net loss of $0.7 million or $0.01 per share in the first quarter 2018.
- Cash and cash equivalents balance of $2.2 million as of March 31, 2019 compared to $3.3 million at year-end 2018.
- Debt balance of zero as of March 31, 2019.
First quarter Business Summary
- In March 2019, Golden began a 3,000-meter, approximately $0.6 million drilling program at its El Quevar silver project in Argentina, with the goal of further defining additional mineralized material in the Yaxtché deposit and surrounding area.
- The Company continues to advance the Yoquivo Au-Ag project in Chihuahua, Mexico and plans to begin drilling in Q2 2019.
Financial Results
The Company reported revenue of approximately $1.9 million in the first quarter 2019 related to the oxide plant lease and costs of approximately $0.6 million related to the services Golden provides under the terms of the lease, for a net margin of approximately $1.3 million. Golden received $0.4 million in proceeds from the sale of common stock under the existing Lincoln Park Capital Commitment Purchase Agreement (“LPC Program”) during the quarter. Exploration expenses were $0.9 million in the first quarter, reflecting work at the Yoquivo, Santa Maria and other properties primarily in Mexico, as well as property holding costs and allocated administrative expenses. El Quevar project expense was $0.3 million in the quarter and includes costs associated with the drilling program begun in March 2019 as well as project evaluation and property holding costs. Administrative expenses totaled $1.1 million in the first quarter 2019. These expenses, including costs associated with being a public company, are incurred primarily by the Company’s corporate activities in support of the Velardeña Properties, the El Quevar project and the Company’s exploration portfolio. Golden reported a net loss of $2.4 million or $0.02 per share in the first quarter 2019 compared to a net loss of $0.7 million or $0.01 per share in the year ago period.
Twelve Month Financial Outlook
The Company ended the first quarter 2019 with a cash balance of $2.2 million and expects to receive approximately $4.8 million in net operating margin from the lease of the oxide plant during the 12 months ending March 31, 2020. Additionally, the Company received $0.1 million from the sale of its common stock under the terms of the LPC Program since March 31, 2019. The Company’s currently budgeted expenditures during the 12 months ending March 31, 2020 are as follows:
- Approximately $2.0 million on exploration activities and property holding costs related to the Company’s portfolio of exploration properties located primarily in Mexico, including project assessment and evaluation costs related to Yoquivo and other properties;
- Approximately $1.5 million at the Velardeña Properties for care and maintenance;
- Approximately $1.0 million at the El Quevar project to fund ongoing exploration and evaluation activities, care and maintenance and property holding costs; and
- Approximately $3.0 million on general and administrative costs.
The Company’s currently budgeted expenditures are slightly greater than its resources noted above. Therefore, during 2019 the Company intends to take appropriate actions, which may include sales of certain of the Company’s nonstrategic exploration assets, reductions to the Company’s currently budgeted level of spending, and/or raising additional equity capital through sales under the ATM Program, LPC Program or otherwise.
Additional information regarding first quarter 2019 financial results may be found in the Company’s 10-Q Quarterly Report which is available on the Golden Minerals website at www.goldenminerals.com.
Financial Statements
| CONDENSED CONSOLIDATED BALANCE SHEETS (US Dollars, unaudited) | ||||||||
| March 31, | December 31, | |||||||
| 2019 | 2018 | |||||||
| (in thousands, except share data) | ||||||||
| Assets | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 2,237 | $ | 3,293 | ||||
| Short-term investments | 225 | 330 | ||||||
| Lease receivables | 490 | 481 | ||||||
| Inventories, net | 231 | 229 | ||||||
| Value added tax receivable, net | 12 | 14 | ||||||
| Prepaid expenses and other assets | 1,249 | 1,188 | ||||||
| Total current assets | 4,444 | 5,535 | ||||||
| Property, plant and equipment, net | 6,844 | 7,109 | ||||||
| Total assets | $ | 11,288 | $ | 12,644 | ||||
| Liabilities and Equity | ||||||||
| Current liabilities | ||||||||
| Accounts payable and other accrued liabilities | $ | 1,493 | $ | 1,702 | ||||
| Deferred revenue, current | 293 | 293 | ||||||
| Other current liabilities | 50 | 12 | ||||||
| Total current liabilities | 1,836 | 2,007 | ||||||
| Asset retirement and reclamation liabilities | 2,675 | 2,683 | ||||||
| Deferred revenue, non-current | 234 | 307 | ||||||
| Other long term liabilities | — | 10 | ||||||
| Total liabilities | 4,745 | 5,007 | ||||||
| Commitments and contingencies | ||||||||
| Equity | ||||||||
| Common stock, $.01 par value, 200,000,000 shares authorized; 96,868,433 and 95,620,796 shares issued and outstanding respectively | 968 | 955 | ||||||
| Additional paid in capital | 519,050 | 517,806 | ||||||
| Accumulated deficit | (513,475 | ) | (511,124 | ) | ||||
| Shareholders' equity | 6,543 | 7,637 | ||||||
| Total liabilities and equity | $ | 11,288 | $ | 12,644 | ||||
| CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (US dollars, unaudited) | ||||||||
| Three Months Ended | ||||||||
| March 31, | ||||||||
| 2019 | 2018 | |||||||
| (in thousands except per share data) | ||||||||
| Revenue: | ||||||||
| Oxide plant lease | $ | 1,932 | $ | 1,637 | ||||
| Costs and expenses: | ||||||||
| Oxide plant lease costs | (597 | ) | (503 | ) | ||||
| Exploration expense | (855 | ) | (899 | ) | ||||
| El Quevar project expense | (315 | ) | (272 | ) | ||||
| Velardeña shutdown and care and maintenance costs | (517 | ) | (489 | ) | ||||
| Administrative expense | (1,074 | ) | (1,061 | ) | ||||
| Stock based compensation | (564 | ) | (15 | ) | ||||
| Reclamation expense | (59 | ) | (51 | ) | ||||
| Other operating income, net | 108 | 1,226 | ||||||
| Depreciation and amortization | (274 | ) | (296 | ) | ||||
| Total costs and expenses | (4,147 | ) | (2,360 | ) | ||||
| Income (loss) from operations | (2,215 | ) | (723 | ) | ||||
| Other income and (expense): | ||||||||
| Interest and other (expense) income, net | (98 | ) | 3 | |||||
| Loss on foreign currency | (38 | ) | (15 | ) | ||||
| Total other income (loss) | (136 | ) | (12 | ) | ||||
| Income (loss) from operations before income taxes | (2,351 | ) | (735 | ) | ||||
| Income tax | — | — | ||||||
| Net income (loss) | $ | (2,351 | ) | $ | (735 | ) | ||
| Net income (loss) per common share — basic | ||||||||
| Loss | $ | (0.02 | ) | $ | (0.01 | ) | ||
| Weighted average Common Stock outstanding - basic (1) | 95,755,304 | 91,726,375 | ||||||
(1) Potentially dilutive shares have not been included because to do so would be anti-dilutive.
About Golden Minerals
Golden Minerals is a Delaware corporation based in Golden, Colorado. The Company is primarily focused on advancing its El Quevar silver property in Argentina and on acquiring and advancing mining properties in Mexico with emphasis on areas near its Velardeña processing plants.
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 relating to plans to continue a drilling program at El Quevar and productivity projections from the El Quevar project; future drilling plans and exploration activities at Yoquivo and other properties; financial projections, including budgeted expenditures and the anticipated net operating margin from the Velardeña oxide plant lease; potential sales of certain non-strategic exploration assets of the Company; projected cash balances and anticipated spending during the 12 months ended March 31, 2020; and assumptions regarding raising additional equity capital through sales under the Company’s ATM or LPC programs or otherwise. These statements are subject to risks and uncertainties, including changes in interpretations of geological, geostatistical, metallurgical, mining or processing information and interpretations of the information resulting from future exploration, analysis or mining and processing experience, new information from exploration or analysis; unexpected variations in mineral grades, types and metallurgy, fluctuations in silver and gold metal prices; failure of mined material or veins mined to meet expectations; lower than anticipated revenue from the oxide plant lease as a result of delays or problems at the third party’s mine or the oxide plant or earlier than expected termination of the oxide plant lease; increases in costs and declines in general economic conditions; and changes in political conditions, in tax, royalty, environmental and other laws in Mexico and Argentina, and financial market conditions. Golden Minerals assumes no obligation to update this information. Additional risks relating to Golden Minerals may be found in the periodic and current reports filed with the Securities and Exchange Commission by Golden Minerals, including the Company’s Annual Report on Form 10‐K for the year ended December 31, 2018.