Claude Resources Inc. Increases Net Profit 136% in Second Quarter
SASKATOON, Aug. 11, 2011 /CNW/ --
Trading Symbols
TSX - CRJ
NYSE Amex - CGR
SASKATOON, Aug. 11, 2011 /CNW/ - Claude Resources Inc. ('Claude' or the
'Company') today reported its second quarter financial and operating
results. For the quarter ended June 30, 2011, the Company recorded net
profit of $5.2 million, or $0.03 per share. This compares to a net
profit of $2.2 million for the comparable period in 2010, or $0.02 per
share. For the six months ended June 30, 2011, the Company recorded net
profit of $7.0 million, or $0.05 per share. This compares to a net
profit of $0.6 million, or $0.00 per share, for the comparable period
in 2010.
Speaking today in Saskatoon, President and Chief Executive Officer Neil
McMillan stated, 'The Seabee Operation continues to improve on both the
mining and exploration fronts. As Seabee provides positive free cash
flow, the Company is able to invest in more regional exploration, which
to date has been very successful. The two major capital projects at
Seabee, the shaft extension and mill expansion, are ongoing and are
expected to allow Seabee to decrease unit cash costs and increase
production. Exploration at Madsen has progressed as expected. In the
second quarter, a second drill rig was added on the 16th level in the
Madsen Mine to target the down plunge and strike extensions of the
known high grade 8 Zone. The Phase II exploration program at Madsen
will continue through the balance of this year and into 2012. The
Company balance sheet is excellent and allows the Company to
aggressively develop and explore at all three projects.'
Financials
On January 1, 2011, the Company transitioned to the International
Financial Reporting Standards ('IFRS'). The new accounting policies
under IFRS have been used in this quarter's information and related
quarterly information for comparative purposes. Further details
regarding IFRS can be found in the Company's Q2 2011 Management
Discussion &Analysis available on Sedar (www.sedar.com).
For the three months ended June 30, 2011, cash flow from operations (1)
before net changes in non-cash working capital improved 66 percent to
$8.3 million, or $0.05 per common share, from $5.0 million, or $0.04
per common share, in the second quarter of 2010. Year to date, cash
flow from operations before net changes in non-cash working capital
improved 103 percent to $12.2 million, or $0.08 per common share, from
$6.0 million, or $0.05 per common share, during the same period in
2010.
((1)) For an explanation of non-IFRS performance measures refer to 'Non-IFRS
Performance Measures' in the Company's MD&A filed on www.sedar.com.
Gold revenue from the Company's Seabee Gold Operation for the quarter
ended June 30, 2011 increased 20 percent to $18.2 million from $15.2
million reported in the second quarter of 2010. The increase in gold
revenue was attributable to a slight increase in gold sales volume (Q2
2011 - 12,418 ounces; Q2 2010 - 12,188 ounces) and an 18 percent
improvement in Canadian dollar gold prices realized (Q2 2011 - $1,469
(U.S. $1,518); Q2 2010 - $1,247 (U.S. $1,213)).
Gold revenue for the first six months of 2011 increased 24 percent to
$31.6 from $25.4 million reported in the first six months of 2010. This
increase was attributable to higher gold sales volume (2011 - 21,879
ounces; 2010 - 21,078 ounces) and a 20 percent improvement in Canadian
dollar gold prices realized: YTD 2011 - $1,443 (U.S. $1,477); YTD 2010
- $1,205 (U.S. $1,165).
Total Canadian dollar cash cost per ounce of gold (1) for the second
quarter increased two percent to CDN $717 (U.S. $741) per ounce from
CDN $704 (U.S. $685) in the second quarter of 2010. Year to date in
2011, total cash cost per ounce of CDN $807 (U.S. $826) per ounce was
relatively unchanged from per ounce costs reported in 2010. During the
first half, cash operating cost per ounce was negatively impacted by
the 6 day shut down during the first quarter of 2011.
((1)) For an explanation of non-IFRS performance measures refer to 'Non-IFRS
Performance Measures' in the Company's MD&A filed on www.sedar.com.
Financial
and
Operating
Highlights
(unaudited):
Three
Three Months
Months June Six Months Six Months
June 30 30 June 30 June 30
2011 2010 2011 2010
Gold revenue
(CDN$
millions) 18.2 15.2 31.6 25.4
Cash flow
from
operations
(CDN$
millions)( )
((1)) 8.3 5.0 12.2 6.0
Net profit
(CDN$
millions) 5.2 2.2 7.0 0.6
Net profit
per share
($) 0.03 0.02 0.05 0.00
Average
realized
gold price
(CDN$ per oz 1,247
/ US$ per /
oz) 1,469/1,518 1,213 1,443/1,477 1,205/1,165
Cash costs
(CDN$ per oz
/ US$ per 704 /
oz)((1)) 717 / 741 685 807/826 806/779
EBITDA ($
millions)(
(1)) 7.7 6.0 11.0 6.0
Tonnes
Milled 65,502 46,071 116,003 84,561
Head Grade
(grams per
tonne) 6.26 8.44 6.23 8.14
Recovery (%) 95.8 95.3 95.4 95.4
Gold
Produced
(ounces) 12,624 11,902 22,163 21,123
Gold Sold
(ounces)( ) 12,418 12,188 21,879 21,078
Production
costs (CDN$
million) 8.9 8.6 17.7 17.0
( )((1)) For an explanation of non-IFRS performance measures refer to 'Non-IFRS
Performance Measures' in the Company's Q2 2011 MD&A filed on www.sedar.com.
During the second quarter, the Company completed the private placement
equity financing previously announced on April 6, 2011. The offering
consisted of the issuance of 20,000,000 common shares of the Company at
a price of $2.50 per common share; in addition, the underwriters of the
offering exercised their overallotment option for an additional
3,000,000 common shares at a price of $2.50 per common share. The
aggregate gross proceeds raised under the offering was $57.5 million.
Claude plans to use the net proceeds of the offering for the
exploration and development of the Company's projects and for general
corporate purposes.
Operations:
For the quarter ended June 30, 2011, Claude extracted and processed
65,502 tonnes of ore at its Seabee Gold Operation with a grade of 6.26
grams of gold per tonne (Q2 2010 - 46,071 tonnes at 8.44 grams of gold
per tonne). Sales volume for the quarter was 12,418 ounces of gold
compared to 12,188 ounces of gold in Q2 2010, an increase of two
percent period over period. Produced ounces for the period increased by
six percent to 12,624 ounces from 11,902 ounces in Q2 2010.
For the six months ending June 30, 2011, Claude milled 116,003 tonnes at
a grade of 6.23 grams of gold per tonne (YTD 2010 - 84,561 tonnes at
8.14 grams of gold per tonne). Produced ounces were 22,163 (YTD 2010 -
21,123) with mill recoveries of 95.4 percent (YTD 2010 - 95.4 percent).
These results are attributable to the increase of lower grade Santoy 8
ore being brought to the Seabee Mill. Gold sales volume for the first
half of the year improved four percent to 21,879 ounces from 21,078 in
the same period in the prior year.
Exploration:
Claude expanded its exploration and development strategy during the
second quarter of 2011. Exploration at the Seabee Gold Operation
focused on continued drill testing of the Neptune, Santoy Gap and
near-mine targets as well as reconnaissance geochemical surveys in the
Pine Lake area. At the Amisk Gold Project, exploration drilling
continued to expand and confirm the National Instrument 43-101 open-pit
resource estimate. Work during the quarter included drilling of 1,300
metres in seven holes, advancement of metallurgical and engineering
test work and baseline environmental studies.
Exploration at Madsen advanced shaft dewatering and rehabilitation with
a two rig, 19,500 metre Phase II underground drilling program was
initiated in the second quarter.
Outlook:
For 2011, the Company will continue to focus on the following:
i) Advancement of surface and underground exploration drill
programs at the Company's 100 percent owned Madsen Exploration
Project with commencement of Phase II of underground drilling
from the 16th level drill platform;
ii) Further development of satellite deposits and improvement of
operating margins at the Seabee Gold Operation;
iii) Continue exploration and development at the Seabee Gold
Operation to sustain or increase reserves and resources;
iv) Investment in capital projects and equipment to increase both
production and productivity at the Seabee Gold Operation; and
v) Expand the scope of the Amisk Gold Project and evaluate the
bulk mining potential of the system.
Production during the second quarter was below plan due to a shortage of
skilled miners and long hole stopes. On August 1, a lightning strike
hit Seabee's Central Milling Facility's head-frame, damaging the
electric motors on two of our three ball mills. As a result, mill
processing capacity was reduced and gold output for the third quarter
is now expected to be approximately 12,000 ounces. Based on the above,
Management now expects to produce between 50,000 to 52,000 ounces for
the year ending December 31, 2011. Unit cash costs for 2011 are
estimated to be similar to 2010.
Conference Call
We invite you to join our conference call on August 11, 2011 at 11:00 am
EST.
To participate in the conference call please dial 1-647-427-7450 or
1-888-231-8191. A replay will be available until August 19, 2011 at
11:59 PM ET by calling 1-416-849-0833 or 1-800-642-1687 and entering
the passcode 67513072.
To view and listen to the webcast please use the following URL in your
web browser: http://event.on24.com/r.htm?e=343206&s=1&k=B08E60702F27F8C457206BD10D3C176C
Claude Resources Inc. is a gold producer with shares listed on both the
Toronto Stock Exchange (TSX-CRJ) and the NYSE Amex (NYSE Amex-CGR). The
Company is also engaged in the exploration and development of gold
mineral reserves and mineral resources. The Company's entire asset base
is located in Canada. Its main revenue generating asset is the 100
percent owned Seabee gold operation, located in northern Saskatchewan.
Since 1991, Claude has produced over 950,000 ounces of gold from its
Seabee Operations. Claude also owns 100 percent of the 10,000 acre
Madsen Property in the prolific Red Lake gold camp of northwestern
Ontario and has a 65 percent working interest in the Amisk Gold
Property in northeastern Saskatchewan.
Philip Ng, P.Eng, Senior Vice President, Mining Operations and Brian
Skanderbeg, P.Geo., Vice President, Exploration, Qualified Persons,
have reviewed the contents of this news release for accuracy.
CAUTION REGARDING FORWARD-LOOKING STATEMENTS
This Press Release may contain statements which constitute
'forward-looking' statements, including statements regarding the plans,
intentions, beliefs and current expectations of the Company, its
directors, or its officers with respect to the future business
activities and operating performance of the Company. The words 'may',
'would', 'could', 'will', 'intend', 'plan', 'anticipate', 'believe',
'estimate', 'expect' and similar expressions, as they relate to the
Company, or its management, are intended to identify such
forward-looking statements. Investors are cautioned that any such
forward-looking statements are not guarantees of future business
activities or performance and involve risks and uncertainties, and that
the Company's future business activities may differ materially from
those in the forward-looking statements as a result of various factors.
Such risks, uncertainties and factors are described in the periodic
filings with the Canadian securities regulatory authorities, including
the Company's Annual Information Form and quarterly and annual
Management's Discussion and Analysis, which may be viewed on SEDAR at
www.sedar.com. Should one or more of these risks or uncertainties
materialize, or should assumptions underlying the forward-looking
statements prove incorrect, actual results may vary materially from
those described herein as intended, planned, anticipated, believed,
estimated or expected. Although the Company has attempted to identify
important risks, uncertainties and factors which could cause actual
results to differ materially, there may be others that cause results
not to be as anticipated, estimated or intended. The Company does not
intend, and does not assume any obligation, to update these
forward-looking statements.
A copy of Claude's interim Management's Discussion and Analysis as well
as Claude's Q2 2011 financial statements and notes (unaudited) can be
viewed at www.clauderesources.com. Further information relating to Claude Resources Inc. has been filed
on SEDAR and may be viewed at www.sedar.com.
To view this news release in HTML formatting, please use the following URL: http://www.newswire.ca/en/releases/archive/August2011/11/c3106.html
Neil McMillan, President & CEO
Phone: (306) 668-7505
or
Marc Lepage, Manager, Investor Relations
Phone: (306) 668-7505
Email: ir@clauderesources.com
Website: www.clauderesources.com