Mandalay Resources Delivers Strong Second Quarter 2024 Financial Results Leading To $63 Million Cash Balance
Rhea-AI Summary
Mandalay Resources (TSX: MND, OTCQB: MNDJF) reported strong financial results for Q2 2024, with consolidated revenue up 59% to $63.1 million compared to Q2 2023. The company achieved a cash balance of $62.9 million and a net cash position of $35.8 million. Key highlights include:
- Generated $24.1 million in operating cash flow and $15.6 million in free cash flow
- Consolidated net income of $15.9 million ($0.17 per share)
- Cash operating cost decreased 12% to $1,022 per gold equivalent ounce
- All-in sustaining cost decreased 17% to $1,419 per gold equivalent ounce
Björkdal recorded its highest quarterly revenue of $28.8 million, while Costerfield generated $34.3 million. The company fully repaid its $20 million Revolving Credit Facility balance, leaving it with no debt other than minor equipment leases.
Positive
- Consolidated revenue increased 59% year-over-year to $63.1 million
- Cash balance grew to $62.9 million with a net cash position of $35.8 million
- Generated $24.1 million in operating cash flow and $15.6 million in free cash flow
- Consolidated net income rose to $15.9 million ($0.17 per share) from $0.5 million in Q2 2023
- Cash operating cost decreased 12% to $1,022 per gold equivalent ounce
- All-in sustaining cost decreased 17% to $1,419 per gold equivalent ounce
- Björkdal achieved record quarterly revenue of $28.8 million
- Costerfield generated $34.3 million in quarterly revenue
- Fully repaid $20 million Revolving Credit Facility balance, leaving company debt-free
Negative
- None.
News Market Reaction 1 Alert
On the day this news was published, MNDJF gained 8.19%, reflecting a notable positive market reaction.
Data tracked by StockTitan Argus on the day of publication.
The Company's condensed and consolidated interim financial result for the quarter ended June 30, 2024, together with its Management's Discussion and Analysis ("MD&A") for the corresponding period, can be accessed under the Company's profile on www.sedar.com and on the Company's website at www.mandalayresources.com. All currency references in this press release are in
Second Quarter 2024 Highlights:
- Continued strengthening of balance sheet with cash balance of
$62.9 million $35.8 million - Generated
$24.1 million $15.6 million - Consolidated revenue up by
59% as compared to Q2 2023, at$63.1 million - Björkdal recorded its highest ever quarterly revenue of
$28.8 million - Costerfield generated
$34.3 million
- Björkdal recorded its highest ever quarterly revenue of
- Consolidated cash operating cost1 per gold equivalent ounce produced decreased by
12% to$1,022 $1,159 - All-in sustaining cost1 per gold equivalent ounce produced decreased by
17% to$1,419 $1,704 - Consolidated net income was
$15.9 million $0.17 C per share), compared to$0.23 $0.5 million
Subsequent to the quarter end, based on the Company's strong quarter-end cash position and ongoing cash flow expectations, Mandalay repaid the entire outstanding balance (
Frazer Bourchier, President, and CEO commented:
"In the second quarter, we again delivered revenue and earnings growth, driven by solid production results and a stable cost profile that met our internal plans. Based on our strong quarter-end cash position of approximately
____________________________ | |
1. | Gold equivalent production, adjusted EBITDA, free cash flow, net cash, cash operating costs and all-in sustaining costs are non-GAAP financial performance measures with no standard definition under IFRS. Refer to "Non-GAAP Financial Performance Measures" at the end of this press release for further information. |
Hashim Ahmed, CFO commented:
"On a consolidated basis, the Company generated
"Our consolidated cash and all-in sustaining costs per ounce of gold equivalent produced during Q2 2024 were
"Björkdal achieved its highest quarterly revenue, nearing
Mr. Bourchier concluded: "Mandalay made substantial progress in strengthening its balance sheet during the first half of the year. We are executing well on our operational strategic priorities and remain on track to achieve our annual production guidance, while continuing to take steps to further optimize our operations for better sustained cash flow generation, positioning the Company for long-term growth and increased shareholder value."
Second Quarter 2024 Financial Summary
The following table summarizes the Company's consolidated financial results for the three and six months ended June 30, 2024 and 2023:
($ thousands, except where indicated) | Three months ended | Six months ended | ||
June 30, | June 30, | |||
2024 | 2023 | 2024 | 2023 | |
Revenue | 63,054 | 39,670 | 118,565 | 81,849 |
Cost of sales | 25,162 | 29,236 | 52,193 | 55,842 |
Adjusted EBITDA (1) | 35,862 | 8,890 | 62,597 | 21,835 |
Adjusted net income (loss) (1) | 16,802 | (3,229) | 28,954 | (2,711) |
Consolidated net income | 15,857 | 524 | 21,745 | 1,078 |
Capital expenditure | 8,791 | 14,095 | 21,937 | 22,872 |
Total assets | 323,272 | 271,324 | 323,272 | 271,324 |
Total liabilities | 109,244 | 91,001 | 109,244 | 91,001 |
Adjusted net income (loss) per share (1) | 0.18 | (0.03) | 0.31 | (0.03) |
Consolidated net income per share | 0.17 | 0.01 | 0.23 | 0.01 |
1. | Adjusted EBITDA, adjusted net income and adjusted net income per share are non-GAAP financial performance measures with no standard definition under IFRS. Refer to "Non-GAAP Financial Performance Measures" at the end of this press release for further information. |
In Q2 2024, Mandalay generated consolidated revenue of
Consolidated cash operating cost per ounce of gold equivalent produced decreased
Cost of sales including change in inventory during the second quarter of 2024 versus the second quarter of 2023 were
Mandalay generated adjusted EBITDA of
Consolidated net income was
Second Quarter Operational Summary
The table below summarizes the Company's operations, capital expenditures and operational unit costs for the three and six months ended June 30, 2024 and 2023:
Three months ended | Six months ended | |||
June 30, | June 30, | |||
2024 | 2023 | 2024 | 2023 | |
Costerfield | ||||
Gold produced (oz) | 11,027 | 7,296 | 23,003 | 14,664 |
Antimony produced (t) | 359 | 517 | 763 | 1,061 |
Gold equivalent produced (oz) | 13,773 | 10,453 | 28,339 | 21,470 |
Cash operating cost (1) per oz gold eq. produced ($) | 844 | 930 | 811 | 925 |
All-in sustaining cost (1) per oz gold eq. produced ($) | 1,142 | 1,268 | 1,072 | 1,190 |
Capital development | 1,023 | 983 | 1,877 | 1,848 |
Property, plant and equipment purchases | 1,291 | 1,089 | 2,144 | 1,597 |
Capitalized exploration | 2,281 | 1,968 | 4,228 | 4,120 |
Björkdal | ||||
Gold produced (oz) | 12,599 | 10,397 | 22,969 | 19,366 |
Cash operating cost (1) per oz gold produced ($) | 1,216 | 1,389 | 1,300 | 1,483 |
All-in sustaining cost (1,3) per oz gold produced ($) | 1,553 | 1,978 | 1,695 | 1,959 |
Capital development | 2,110 | 2,761 | 4,791 | 4,569 |
Property, plant and equipment purchases | 1,296 | 5,743 | 2,704 | 8,327 |
Capitalized exploration | 1,013 | 1,551 | 1,612 | 2,344 |
Consolidated | ||||
Gold equivalent produced (oz) | 26,372 | 20,850 | 51,308 | 40,836 |
Cash operating cost (1) per oz gold eq. produced ($) | 1,022 | 1,159 | 1,030 | 1,190 |
All-in sustaining cost (1,3) per oz gold eq. produced ($) | 1,419 | 1,704 | 1,427 | 1,663 |
Capital development | 3,133 | 3,744 | 6,668 | 6,417 |
Property, plant and equipment purchases (2) | 2,364 | 6,832 | 9,372 | 9,924 |
Capitalized exploration | 3,294 | 3,519 | 5,897 | 6,531 |
1. | Cash operating cost and all-in sustaining cost are non-GAAP financial performance measures with no standard definition under IFRS. Refer to "Non-GAAP Financial Performance Measures" at the end of this press release for further information. |
2. | includes equipments purchased for reclamation activities at non-operating site. |
3. | All-in sustaining costs in the current year includes tailings dam amortization, accordingly the 2023 comparative figures have been updated. |
Costerfield gold-antimony mine,
During Q2 2024, Costerfield produced 11,027 ounces of gold compared to 7,296 ounces in Q2 2023, an increase of
The cash operating cost per ounce of gold equivalent produced decreased by
Björkdal gold mine, Skellefteå,
During Q2 2024, Björkdal produced 12,599 ounces of gold compared to 10,397 ounces in Q2 2023, an increase of
The cash operating cost per ounce produced for Q2 2024 decreased by
Lupin,
Care and maintenance spending at Lupin was less than
La Quebrada,
No work was carried out on the La Quebrada development property during Q2 2024.
Conference Call
A conference call with Frazer Bourchier, President and Chief Executive Officer of Mandalay, for investors and analysts on August 8, 2024, at 8:00 AM (
Participant Number ( | 1-800-836-8184 |
Conference ID: | 94411 |
Alternatively, please register for the webcast here. A replay of the conference call will be available until 11:59 PM (Toronto time), August 15, 2024, and can be accessed using the following dial-in numbers:
Encore Number (Canada Toll free): | 1-888-660-6345 |
Encore Replay Code: | 94411# |
About Mandalay Resources Corporation
Mandalay Resources is a Canadian-based natural resource company with producing assets in
Mandalay's mission is to create shareholder value through the profitable operation and regional exploration programs, at both its Costerfield and Björkdal mines. Currently, the Company's main objectives are to continue mining the high-grade Youle and Shepherd veins at Costerfield, and to extend Mineral Reserves. At Björkdal, the Company will aim to increase production from the Eastern Extension area and other higher-grade areas in the coming years, in order to maximize profit margins from the mine.
Forward-Looking Statements
This news release contains "forward-looking statements" within the meaning of applicable securities laws, including statements regarding the Company's anticipated performance in 2024. Readers are cautioned not to place undue reliance on forward-looking statements. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things, changes in commodity prices and general market and economic conditions. The factors identified above are not intended to represent a complete list of the factors that could affect Mandalay. A description of additional risks that could result in actual results and developments differing from those contemplated by forward-looking statements in this news release can be found under the heading "Risk Factors" in Mandalay's annual information form dated March 31, 2024, a copy of which is available under Mandalay's profile at www.sedar.com. In addition, there can be no assurance that any inferred resources that are discovered as a result of additional drilling will ever be upgraded to proven or probable reserves. Although Mandalay has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
Non-GAAP Performance Measures
This news release may contain references to adjusted EBITDA, adjusted net income, free cash flow, cash operating cost per ounce of gold equivalent produced and all-in sustaining cost all of which are non-GAAP performance measures and do not have standardized meanings under IFRS. Therefore, these measures may not be comparable to similar measures presented by other issuers.
Management uses adjusted EBITDA and free cash flow as measures of operating performance to assist in assessing the Company's ability to generate liquidity through operating cash flow to fund future working capital needs and to fund future capital expenditures, as well as to assist in comparing financial performance from period to period on a consistent basis. Management uses adjusted net income in order to facilitate an understanding of the Company's financial performance prior to the impact of non-recurring or special items. The Company believes that these measures are used by and are useful to investors and other users of the Company's financial statements in evaluating the Company's operating and cash performance because they allow for analysis of its financial results without regard to special, non-cash and other non-core items, which can vary substantially from company to company and over different periods.
The Company defines adjusted EBITDA as income from mine operations, net of administration costs, and before interest, taxes, non-cash charges/(income), intercompany charges and finance costs. The Company defines adjusted net income as net income before special items. Special items are items of income and expense that are presented separately due to their nature and, in some cases, expected infrequency of the events giving rise to them. A reconciliation between adjusted EBITDA and adjusted net income, on the one hand, and consolidated net income, on the other hand, is included in the MD&A.
The Company defines free cash flow as a measure of the Company's ability to generate and manage liquidity. It is calculated starting with the net cash flows from operating activities (as per IFRS) and then subtracting capital expenditures and lease payments. Refer to "Non-GAAP Financial Performance Measures" section of the MD&A for a reconciliation between free cash flow and net cash flows from operating activities.
For Costerfield, equivalent gold ounces produced is calculated by adding to gold ounces produced, the antimony tonnes produced times the average antimony price in the period divided by the average gold price in the period. The total cash operating cost associated with the production of these equivalent ounces produced in the period is then divided by the equivalent gold ounces produced to yield the cash operating cost per equivalent ounce produced. The cash operating cost excludes royalty expenses. Site all-in sustaining costs include total cash operating costs, sustaining mining capital, royalty expense, accretion of reclamation provision and tailings dam amortization. Sustaining capital reflects the capital required to maintain each site's current level of operations. The site's all-in sustaining cost per ounce of gold equivalent in a period equals the all-in sustaining cost divided by the equivalent gold ounces produced in the period.
For Björkdal, the total cash operating cost associated with the production of gold ounces produced in the period is then divided by the gold ounces produced to yield the cash operating cost per gold ounce produced. The cash operating cost excludes royalty expenses. Site all-in sustaining costs include total cash operating costs, sustaining mining capital, royalty expense, accretion of reclamation provision and tailings dam amortization. Sustaining capital reflects the capital required to maintain each site's current level of operations. The site's all-in sustaining cost per ounce of gold equivalent in a period equals the all-in sustaining cost divided by the equivalent gold ounces produced in the period.
For the Company as a whole, cash operating cost per gold equivalent ounce is calculated by summing the gold equivalent ounces produced by each site and dividing the total by the sum of cash operating costs at the sites. Consolidated cash operating cost excludes royalty and corporate level general and administrative expenses. This definition was updated in the third quarter of 2020 to exclude corporate general and administrative expenses to better align with industry standard. All-in sustaining cost per ounce gold equivalent in the period equals the sum of cash operating costs associated with the production of gold equivalent ounces at all operating sites in the period plus corporate overhead expense in the period plus sustaining mining capital, royalty expense, accretion of reclamation provision and tailings dam amortization, divided by the total gold equivalent ounces produced in the period. A reconciliation between cost of sales and cash operating costs, and also cash operating cost to all-in sustaining costs are included in the MD&A.
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SOURCE Mandalay Resources Corporation
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