TORONTO, ONTARIO--(Marketwired - Feb. 18, 2015) - Teranga Gold Corporation ("Teranga" or the "Company") (TSX:TGZ)(ASX:TGZ) is pleased to report its financial results for the fourth quarter and full year ended December 31, 2014. All financial information is in US dollars unless otherwise noted.
"During 2014 we made significant progress in executing against our key objectives, namely to maximize free cash flow and profitability, to strengthen our balance sheet and to grow organically," stated Richard Young, President and Chief Executive Officer of Teranga. "With the significant improvement in our costs and efficiencies, we generated free cash flow of $189 per ounce, which is in line with the top senior gold companies."
"Just as importantly, our balance sheet strengthened significantly over the last 12 months," stated Navin Dyal, Vice President and Chief Financial Officer of Teranga. "As of today we are now debt-free, a stand-out achievement in our sector particularly given the declining gold price environment."
Added Mr. Young, "Last year was a successful one for Teranga and 2015 is starting off on an equally positive note. Roadwork has begun on our new high-grade Gora deposit and we are focused on having this new mine up and running by the fourth quarter. With 6.1 million ounces of measured and indicated gold resources, together with the growth opportunities we see from our large mine license and regional land package, we believe we are just scratching the surface of our potential."
Key Highlights
Three months ended December 31 | Year ended December 31 | ||||||||||||
2014 | 2013 | Change | 2014 | 2013 | Change | ||||||||
Revenue | 76,553 | 58,302 | 31 | % | 260,588 | 297,927 | (13 | %) | |||||
Profit (loss) attributable to shareholders of Teranga | 27,693 | (2,420 | ) | n/a | 17,776 | 50,280 | (65 | %) | |||||
Per share | 0.08 | (0.01 | ) | n/a | 0.05 | 0.19 | (72 | %) | |||||
Operating cash flow | 30,677 | 13,137 | 134 | % | 49,009 | 74,307 | (34 | %) | |||||
Free cash flow1 | 26,572 | 20,412 | 30 | % | 39,096 | 16,251 | 141 | % | |||||
Gold production (ounces)2 | 71,278 | 52,368 | 36 | % | 211,823 | 207,204 | 2 | % | |||||
Total cash costs per ounce sold3 | 598 | 711 | (16 | %) | 710 | 641 | 11 | % | |||||
All-in sustaining costs per ounce sold3 | 711 | 850 | (16 | %) | 865 | 1,033 | (16 | %) |
For a full explanation of Financial, Operating, Exploration and Development results please see the Audited Consolidated Financial Statements and Management's Discussion & Analysis for 2014 at www.terangagold.com.
1Free cash flow is defined as operating cash flow (excluding one-time transaction costs related to the acquisition of the OJVG) less capital expenditures.
2This production guidance is based on existing proven and probable reserves only from both the Sabodala mining licence and OJVG mining license as disclosed in Table 2 on page 8 of this Report. The estimated ore reserves underpinning this production guidance have been prepared by a competent person in accordance with the requirements of the 2012 Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the "JORC Code"). Please refer to the Competent Persons Statement on pages 22-23 of this Report.
3Total cash costs per ounce and all-in sustaining costs per ounce of gold sold are non-IFRS measures which do not have standard meanings under IFRS. Please refer to Non-IFRS Performance Measures at the end of this Report.
Review of Financial Results
(US$000's, except where indicated) | Three months ended December 31 | Year ended December 31 | |||||||||
Financial Data | 2014 | 2013 | 2014 | 2013 | 2012 | ||||||
Revenue | 76,553 | 58,302 | 260,588 | 297,927 | 350,520 | ||||||
Profit (loss) attributable to shareholders of Teranga1 | 27,693 | (2,420 | ) | 17,776 | 50,280 | 93,655 | |||||
Per share1 | 0.08 | (0.01 | ) | 0.05 | 0.19 | 0.38 | |||||
Operating cash flow | 30,677 | 13,137 | 49,009 | 74,307 | 104,982 | ||||||
Capital expenditures | 4,105 | 3,725 | 18,913 | 69,056 | 115,785 | ||||||
Free cash flow2 | 26,572 | 20,412 | 39,096 | 16,251 | (10,803 | ) | |||||
Cash and cash equivalents (including bullion receivables and restricted cash) | 35,810 | 42,301 | 44,974 | ||||||||
Net cash (debt)3 | 31,864 | (32,068 | ) | (75,182 | ) | ||||||
Total assets1 | 726,323 | 628,643 | 565,715 | ||||||||
Total non-current liabilities | 128,112 | 29,241 | 68,505 | ||||||||
Note: Results include the consolidation of 100% of the OJVG's operating results, cash flows and net assets from January 15, 2014. | |||||||||||
1 The Company has reassessed the accounting for deferred stripping assets to include amortization of equipment directly related to deferred stripping activity. The impact of this adjustment has been applied retrospectively from January 1, 2012. | |||||||||||
2 Free cash flow is defined as operating cash flow (excluding one-time transaction costs related to the acquisition of the OJVG) less capital expenditures. | |||||||||||
3 Net cash (debt) is defined as total borrowings and financial derivative liabilities less cash and cash equivalents, bullion receivables and restricted cash. |
Review of Operating Results
Three months ended December 31 | Year ended December 31 | ||||||||
Operating Results | 2014 | 2013 | 2014 | 2013 | |||||
Ore mined | ('000t | ) | 2,666 | 1,993 | 6,174 | 4,540 | |||
Waste mined - operating | ('000t | ) | 5,594 | 6,655 | 21,178 | 15,172 | |||
Waste mined - capitalized | ('000t | ) | 490 | 420 | 1,969 | 15,066 | |||
Total mined | ('000t | ) | 8,750 | 9,068 | 29,321 | 34,778 | |||
Grade mined | (g/t | ) | 1.47 | 1.61 | 1.54 | 1.62 | |||
Ounces mined | (oz | ) | 126,334 | 103,340 | 305,192 | 236,718 | |||
Strip ratio | waste/ore | 2.3 | 3.6 | 3.7 | 6.7 | ||||
Ore milled | ('000t | ) | 1,009 | 860 | 3,622 | 3,152 | |||
Head grade | (g/t | ) | 2.44 | 2.11 | 2.03 | 2.24 | |||
Recovery rate | % | 90.1 | 89.7 | 89.7 | 91.4 | ||||
Gold produced1 | (oz | ) | 71,278 | 52,368 | 211,823 | 207,204 | |||
Gold sold | (oz | ) | 63,711 | 46,561 | 206,336 | 208,406 | |||
Average realized price | $/oz | 1,199 | 1,249 | 1,259 | 1,246 | ||||
Total cash cost (incl. royalties)2 | $/oz sold | 598 | 711 | 710 | 641 | ||||
All-in sustaining costs2 | $/oz sold | 711 | 850 | 865 | 1,033 | ||||
Mining | ($/t mined | ) | 2.58 | 2.65 | 2.83 | 2.59 | |||
Milling | ($/t milled | ) | 13.91 | 17.96 | 17.15 | 20.15 | |||
G&A | ($/t milled | ) | 4.27 | 4.84 | 4.61 | 5.38 | |||
1 Gold produced represents change in gold in circuit inventory plus gold recovered during the period. | |||||||||
2 Total cash costs per ounce and all-in sustaining costs per ounce are prior to non-cash inventory write-downs to net realizable value and are non-IFRS financial measures that do not have a standard meaning under IFRS. Please refer to Non-IFRS Performance Measures at the end of this report. | |||||||||
Three months ended December 31, 2014 | Masato | Sabodala | Total | ||||
Ore mined | ('000t) | 1,788 | 878 | 2,666 | |||
Waste mined - operating | ('000t) | 3,789 | 1,805 | 5,594 | |||
Waste mined - capitalized | ('000t) | 490 | - | 490 | |||
Total mined | ('000t) | 6,067 | 2,683 | 8,750 | |||
Grade mined | (g/t) | 1.28 | 1.86 | 1.47 | |||
Ounces mined | (oz) | 73,875 | 52,459 | 126,334 |
Year ended December 31, 2014 | Masato | Sabodala | Total | ||||
Ore mined | ('000t) | 2,003 | 4,171 | 6,174 | |||
Waste mined - operating | ('000t) | 4,392 | 16,786 | 21,178 | |||
Waste mined - capitalized | ('000t) | 490 | 1,479 | 1,969 | |||
Total mined | ('000t) | 6,885 | 22,436 | 29,321 | |||
Grade mined | (g/t) | 1.27 | 1.66 | 1.54 | |||
Ounces mined | (oz) | 82,017 | 223,175 | 305,192 |
Review of Cost of Sales
(US$000's) | Three months ended December 31 | Year ended December 31 | ||||||
Cost of Sales | 2014 | 2013 | 2014 | 2013 | ||||
Mine production costs - gross | 41,123 | 43,555 | 162,410 | 170,752 | ||||
Capitalized deferred stripping | (1,266 | ) | (1,444 | ) | (5,976 | ) | (43,264 | ) |
Capitalized deferred stripping - non-cash1 | 189 | 137 | (658 | ) | (4,124 | ) | ||
40,046 | 42,248 | 155,776 | 123,364 | |||||
Depreciation and amortization - deferred stripping assets1 | 7,205 | 12,639 | 28,911 | 17,850 | ||||
Depreciation and amortization - property, plant & equipment and mine development expenditures | 11,988 | 15,263 | 40,605 | 60,683 | ||||
Royalties | 3,843 | 2,890 | 12,486 | 14,755 | ||||
Advanced royalty payment | 391 | - | 440 | - | ||||
Rehabilitation | - | - | - | 6 | ||||
Inventory movements | (5,802 | ) | (11,945 | ) | (22,145 | ) | (8,552 | ) |
Inventory movements - non-cash1 | (3,907 | ) | (12,569 | ) | (8,089 | ) | (14,672 | ) |
(9,709 | ) | (24,514 | ) | (30,234 | ) | (23,224 | ) | |
Total cost of sales before adjustments to net realizable value | 53,764 | 48,526 | 207,984 | 193,434 | ||||
Adjustments to net realizable value1 | (10,865 | ) | - | - | - | |||
Adjustments to net realizable value - depreciation1 | (5,161 | ) | - | - | - | |||
(16,026 | ) | - | - | - | ||||
Total cost of sales | 37,738 | 48,526 | 207,984 | 193,434 |
1 The Company has reassessed the accounting for deferred stripping assets to include amortization of equipment directly related to deferred stripping activity. The impact of this adjustment has been applied retrospectively from January 1, 2012. |
DECEMBER QUARTER FINANCIAL HIGHLIGHTS
DECEMBER QUARTER OPERATIONAL HIGHLIGHTS
FULL YEAR FINANCIAL HIGHLIGHTS
FULL YEAR OPERATIONAL HIGHLIGHTS
LIQUIDITY AND CAPITAL RESOURCES
ADDITIONAL MATTERS
OUTLOOK 2015 | |||||||
Year ended December 31 | |||||||
2014 Actuals | 2015 Guidance Range | ||||||
Operating Results | |||||||
Ore mined | ('000t | ) | 6,174 | 6,500 - 7,500 | |||
Waste mined - operating | ('000t | ) | 21,178 | ~19,500 | |||
Waste mined - capitalized | ('000t | ) | 1,969 | 2,500 - 3,500 | |||
Total mined | ('000t | ) | 29,321 | 28,500 - 30,500 | |||
Grade mined | (g/t | ) | 1.54 | 1.40 - 1.60 | |||
Strip ratio | (waste/ore | ) | 3.7 | 3.00 - 3.50 | |||
Ore milled | ('000t | ) | 3,622 | 3,600 - 3,800 | |||
Head grade | (g/t | ) | 2.03 | 2.00 - 2.20 | |||
Recovery rate | % | 89.7 | 90.0 - 91.0 | ||||
Gold produced1 | (oz | ) | 211,823 | 200,000 - 230,000 | |||
Total cash cost (incl. royalties)2 | $/oz sold | 710 | 650 - 700 | ||||
All-in sustaining costs2,3 | $/oz sold | 865 | 900 - 975 | ||||
Total depreciation and amortization2 | $/oz sold | 298 | 260 - 275 | ||||
Mining | ($/t mined | ) | 2.83 | 2.75 - 2.90 | |||
Mining long haul (cost/t hauled) | ($/t milled | ) | - | 5.00 - 6.00 | |||
Milling | ($/t milled | ) | 17.15 | 15.50 - 17.50 | |||
G&A | ($/t milled | ) | 4.61 | 5.25 - 5.75 | |||
Gold sold to Franco-Nevada1 | (oz | ) | 20,625 | 24,375 | |||
Exploration and evaluation expense (Regional Land Package) | ($ millions | ) | 2.8 | 1.0 - 2.0 | |||
Administration expenses and Social community costs (excluding depreciation) | ($ millions | ) | 14.8 | 15.0 - 16.0 | |||
Mine production costs | ($ millions | ) | 162.4 | 155.0 - 165.0 | |||
Capitalized deferred stripping | ($ millions | ) | 6.0 | 8.0 - 10.0 | |||
Net mine production costs | ($ millions | ) | 156.4 | 147.0 - 155.0 | |||
Capital expenditures | |||||||
Mine site sustaining | ($ millions | ) | 5.0 | 6.0 - 8.0 | |||
Capitalized reserve development (Mine License) | ($ millions | ) | 4.0 | 6.0 - 8.0 | |||
Project development costs (Gora/Kerekounda) | |||||||
Mill optimization | ($ millions | ) | - | 5.0 - 6.0 | |||
Development | ($ millions | ) | 3.9 | 16.5 - 17.5 | |||
Mobile equipment and other | ($ millions | ) | - | 7.5 - 8.5 | |||
Total project development costs | ($ millions | ) | 3.9 | 29.0 - 32.0 | |||
Capitalized deferred stripping | ($ millions | ) | 6.0 | 8.0 - 10.0 | |||
Total capital expenditures | ($ millions | ) | 18.9 | 49.0 - 58.0 | |||
1 22,500 ounces of production are to be sold to Franco Nevada at 20% of the spot gold price. Due to the timing of shipment schedules near year end, the delivery of 1,875 ounces of gold for the month of December was not received by Franco-Nevada until early January 2015. The transaction with Franco-Nevada permits for the delivery of payable gold for up to five business days following a month end. | |||||||
2 Total cash costs per ounce, all-in sustaining costs per ounce and total depreciation and amortization per ounce are non-IFRS financial measures and do not have a standard meaning under IFRS. Please refer to Non-IFRS Performance Measures at the end of this report. | |||||||
3 All-in sustaining costs per ounce sold include total cash costs per ounce, administration expenses (excluding Corporate depreciation expense and social community costs not related to current operations), capitalized deferred stripping, capitalized reserve development and mine site & development capital expenditures as defined by the World Gold Council. | |||||||
Key assumptions: Gold spot price/ounce - US$1,200, Light fuel oil - US$0.95/litre, Heavy fuel oil - US$0.76/litre, US/Euro exchange rate - $1.20, USD/CAD exchange rate - $0.85. | |||||||
Other important assumptions include: any political events are not expected to impact operations, including movement of people, supplies and gold shipments; grades and recoveries will remain consistent with the life-of-mine plan to achieve the forecast gold production; and no unplanned delays in or interruption of scheduled production. |
MANAGEMENT CHANGE
BUSINESS AND PROJECT DEVELOPMENT
Reserves and Resources
Masato Resource Model Update
Table 1: Mineral Resources Summary | |||||||||
Measured | Indicated | Measured and Indicated | |||||||
Tonnes | Grade | Au | Tonnes | Grade | Au | Tonnes | Grade | Au | |
Area | (Mt) | (g/t) | (Moz) | (Mt) | (g/t) | (Moz) | (Mt) | (g/t) | (Moz) |
Sabodala | 23.73 | 1.21 | 0.92 | 19.55 | 1.23 | 0.77 | 43.28 | 1.22 | 1.70 |
Gora | 0.49 | 5.27 | 0.08 | 1.84 | 4.93 | 0.29 | 2.32 | 5.00 | 0.37 |
Niakafiri | 0.30 | 1.74 | 0.02 | 10.50 | 1.10 | 0.37 | 10.70 | 1.12 | 0.39 |
ML Other | |||||||||
Subtotal Sabodala | 24.52 | 1.30 | 1.02 | 31.89 | 1.40 | 1.43 | 56.41 | 1.36 | 2.46 |
Masato | 1.55 | 0.96 | 0.05 | 50.26 | 1.04 | 1.67 | 51.81 | 1.03 | 1.72 |
Golouma | 12.04 | 2.69 | 1.04 | 12.04 | 2.69 | 1.04 | |||
Kerekounda | 2.20 | 3.77 | 0.27 | 2.20 | 3.77 | 0.27 | |||
Somigol Other | 18.72 | 0.93 | 0.56 | 18.72 | 0.93 | 0.56 | |||
Subtotal Somigol | 1.55 | 0.96 | 0.05 | 83.22 | 1.33 | 3.54 | 84.77 | 1.32 | 3.59 |
Total | 26.07 | 1.28 | 1.07 | 115.11 | 1.35 | 4.97 | 141.18 | 1.33 | 6.05 |
Inferred Resources | |||
Tonnes | Au | Au | |
Area | (Mt) | (g/t) | (Moz) |
Sabodala | 18.42 | 0.93 | 0.55 |
Gora | 0.21 | 3.38 | 0.02 |
Niakafiri | 7.20 | 0.88 | 0.21 |
ML Other | 10.60 | 0.97 | 0.33 |
Subtotal Sabodala | 36.43 | 0.94 | 1.11 |
Masato | 19.18 | 1.15 | 0.71 |
Golouma | 2.46 | 2.01 | 0.16 |
Kerekounda | 0.34 | 4.21 | 0.05 |
Somigol Other | 12.87 | 0.84 | 0.35 |
Subtotal Somigol | 34.86 | 1.13 | 1.26 |
Total | 71.29 | 1.03 | 2.37 |
1. | CIM definitions were followed for Mineral Resources. | |
2. | Mineral Resource cut-off grades for Sabodala, Masato, Golouma, Kerekounda and Somigol Other are 0.2 g/t Au for oxide and 0.35 g/t Au for fresh. | |
3. | Mineral Resource cut-off grades for Niakafiri are 0.3 g/t Au for oxide and 0.5 g/t Au for fresh. | |
4. | Mineral Resource cut-off grade for Gora is 0.5 g/t Au for oxide and fresh. | |
5. | Mineral Resource cut-off grade for Niakafiri West and Soukhoto is 0.3 g/t Au for oxide and fresh. | |
6. | Mineral Resource cut-off grade for Diadiako is 0.2 g/t Au for oxide and fresh. | |
7. | Measured Resources include stockpiles which total 11.30 Mt at 0.82 g/t Au for 0.30 Mozs. | |
8. | High grade assays were capped at grades ranging from 10 g/t to 30 g/t Au at Sabodala, 20 g/t to 70 g/t Au at Gora, from 4 g/t to 25 g/t Au at Masato, from 5 g/t to 70 g/t for Golouma, from 11 g/t to 50 g/t at Kerekounda, and from 0.8 g/t to 110 g/t at Somigol Other. | |
9. | The figures above are "Total" Mineral Resources and include Mineral Reserves. | |
10. | Neither underground Mineral Resources nor Mineral Reserves have been generated by the Company, therefore global Mineral Resources have been reported at the determined cut-off grades. A detailed underground analysis will be undertaken to follow-up on the underground resource potential; however, this is not a priority in the near term. | |
11. | Sum of individual amounts may not equal due to rounding. |
For clarity, the mineral Resource estimates disclosed above with respect to Niakafiri, Gora and ML Other (which includes Niakafiri, Niakafiri West, Soukhoto and Diadiako) were prepared and first disclosed under the JORC Code 2004. It has not been updated since to comply with JORC Code 2012 on the basis that the information has not materially changed since it was last reported. Refer to Teranga Gold Corporation's ASX Quarterly December 31, 2013 report filed on January 30, 2014 for further details. All material assumptions and technical parameters previously disclosed continue to be applicable and have not materially changed. See Competent Person Statements on pages 22 and 23 for further details.
Table 2: Mineral Reserves Summary | |||||||||
Proven | Probable | Proven and Probable | |||||||
Tonnes | Grade | Au | Tonnes | Grade | Au | Tonnes | Grade | Au | |
Area | (Mt) | (g/t) | (Moz) | (Mt) | (g/t) | (Moz) | (Mt) | (g/t) | (Moz) |
Sabodala | 1.98 | 1.52 | 0.10 | 2.48 | 1.48 | 0.12 | 4.45 | 1.50 | 0.21 |
Gora | 0.48 | 4.66 | 0.07 | 1.35 | 4.79 | 0.21 | 1.83 | 4.76 | 0.28 |
Niakafiri | 0.23 | 1.69 | 0.01 | 7.58 | 1.12 | 0.27 | 7.81 | 1.14 | 0.29 |
Stockpiles | 11.30 | 0.82 | 0.30 | 11.30 | 0.82 | 0.30 | |||
Subtotal Sabodala | 13.99 | 1.07 | 0.48 | 11.41 | 1.63 | 0.60 | 25.40 | 1.32 | 1.09 |
Masato | 26.93 | 1.13 | 0.98 | 26.93 | 1.13 | 0.98 | |||
Golouma | 6.47 | 2.24 | 0.46 | 6.47 | 2.24 | 0.46 | |||
Kerekounda | 0.88 | 3.26 | 0.09 | 0.88 | 3.26 | 0.09 | |||
Subtotal Somigol | 34.28 | 1.39 | 1.53 | 34.28 | 1.39 | 1.53 | |||
Total | 13.99 | 1.07 | 0.48 | 45.69 | 1.45 | 2.12 | 59.68 | 1.36 | 2.62 |
1. | CIM definitions were followed for Mineral Reserves. | |
2. | Mineral Reserve cut off grades for Sabodala are 0.40 g/t Au for oxide and 0.5 g/t Au for fresh based on a $1,250/oz gold price and metallurgical recoveries between 90 percent and 93 percent. | |
3. | Mineral Reserve cut off grades for Niakafiri are 0.35 g/t Au for oxide and 0.5 g/t Au for fresh based on a $1,350/oz gold price and metallurgical recoveries between 90 percent and 92 percent. | |
4. | Mineral Reserve cut off grade for Gora is 0.76 g/t Au for oxide and fresh based on $1,200/oz gold price and metallurgical recovery of 95 percent. | |
5. | Mineral Reserve cut off grades for Masato are 0.4 g/t Au for oxide and 0.5 g/t for fresh based on $1,200/oz gold price and metallurgical between 90 percent and 93 percent. | |
6. | Mineral reserve cut off grades for Golouma and Kerekounda are 0.4 g/t Au for oxide and 0.5 g/t for fresh based on $1,250/oz gold price and metallurgical between 90 percent and 93 percent. | |
7. | Sum of individual amounts may not equal due to rounding. | |
8. | The Niakafiri deposit is adjacent to the Sabodala village and relocation of at least some portion of the village will be required which will necessitate a negotiated resettlement program with the affected community members. | |
9. | The Gora deposit is intended to be merged into the Sabodala mining license which the State of Senegal has agreed to in principal subject to completion and receipt of an approved environmental and social impact assessment which is ongoing. | |
10. | There are no other known political, legal or environmental risks that could materially affect the potential development of the identified mineral resources or mineral reserves other than as already set out in the Company's Annual Information Form dated March 31, 2014 (revised April 24, 2014). Refer to RISK FACTORS beginning on page 60. |
For clarity, the mineral Reserve estimates disclosed above with respect to Niakafiri and Gora was prepared and first disclosed under the JORC Code 2004. It has not been updated since to comply with JORC Code 2012 on the basis that the information has not materially changed since it was last reported. Refer to Teranga Gold Corporation's ASX Quarterly December 31, 2013 report filed on January 30, 2014 for further details. All material assumptions and technical parameters previously disclosed continue to be applicable and have not materially changed. See Competent Person Statements on pages 22 and 23 for further details.
Masato Development and OJVG Integration
Base-Case Life of Mine
1This forecast financial information is based on the following material assumptions: Gold price: $1,200 per ounce; average annual gold production (2015-2017) of approximately 240,000 ounces; and total mine production costs assum ed for the 2015 Outlook. The production guidance is based on existing proven and probable reserves only from both the Sabodala mining license and OJVG mining license as disclosed in Table 2 on page 11 of this Report.
Mill Enhancements
Heap Leach Project
Gora Development
Sabodala Mine License Reserve Development
2 Analysis to determine underground potential for a portion of the reported resources is planned to be completed by the Company this year
Niakafiri
Masato
Golouma NW Extension
Masato Northeast
Kerekounda
Niakafiri SE and Maki Medina
Regional Exploration
Ninienko
Soreto
Gora Northeast Extension and Zone ABC
KD Prospect
KC Prospect
Renewal of Heremakono Exploration Permit
Non-IFRS Financial Measures
The Company provides some non-IFRS measures as supplementary information that management believes may be useful to investors to explain the Company's financial results. Refer to the Non-IFRS Financial Performance Measures at the end of this report for further details.
(US$000's, except where indicated) | Three months ended December 31 | Year ended December 31 | ||||||
Cash costs per ounce sold | 2014 | 2013 | 2014 | 2013 | ||||
Gold produced1 | 71,278 | 52,368 | 211,823 | 207,204 | ||||
Gold sold | 63,711 | 46,561 | 206,336 | 208,406 | ||||
Cash costs per ounce sold | ||||||||
Cost of sales2 | 37,739 | 48,526 | 207,984 | 193,434 | ||||
Less: depreciation and amortization2 | (19,193 | ) | (27,902 | ) | (69,516 | ) | (78,533 | ) |
Less: realized oil hedge gain | - | - | - | (487 | ) | |||
Add: non-cash inventory movement2 | 3,907 | 12,569 | 8,089 | 14,672 | ||||
Add: non-cash capitalized deferred stripping2 | (188 | ) | (138 | ) | 658 | 4,124 | ||
Less: inventory reversal (write-down) to net realizable value2 | 16,026 | - | - | - | ||||
Less: other adjustments | (172 | ) | 41 | (763 | ) | 358 | ||
Total cash costs | 38,119 | 33,097 | 146,453 | 133,568 | ||||
Total cash costs per ounce sold | 598 | 711 | 710 | 641 | ||||
All-in sustaining costs | ||||||||
Total cash costs | 38,119 | 33,097 | 146,453 | 133,568 | ||||
Administration expenses3 | 3,094 | 2,753 | 13,165 | 12,650 | ||||
Capitalized deferred stripping | 1,266 | 1,444 | 5,977 | 43,264 | ||||
Capitalized reserve development | 1,496 | 529 | 4,020 | 3,524 | ||||
Mine site capital | 1,343 | 1,752 | 8,919 | 22,267 | ||||
All-in sustaining costs | 45,318 | 39,575 | 178,534 | 215,274 | ||||
All-in sustaining costs per ounce sold | 711 | 850 | 865 | 1,033 | ||||
All-in costs | ||||||||
All-in sustaining costs | 45,316 | 39,575 | 178,535 | 215,274 | ||||
Social community costs not related to current operations | 1,061 | 311 | 2,543 | 1,763 | ||||
Exploration and evaluation expenditures | 373 | 1,043 | 2,772 | 5,405 | ||||
All-in costs | 46,750 | 40,929 | 183,850 | 222,442 | ||||
All-in costs per ounce sold | 734 | 879 | 891 | 1,067 | ||||
Depreciation and amortization2 | 19,193 | 26,702 | 69,516 | 77,902 | ||||
Non - cash inventory movement2 | (3,907 | ) | (12,569 | ) | (8,089 | ) | (14,673 | ) |
Total depreciation and amortization | 15,286 | 15,333 | 61,427 | 63,860 | ||||
Total depreciation and amortization per ounce sold2 | 240 | 329 | 298 | 306 |
1 Gold produced represents change in gold in circuit inventory plus gold recovered during the period. |
2 The Company has reassessed the accounting for deferred stripping assets to include amortization of equipment directly related to deferred stripping activity. The impact of this adjustment has been applied retrospectively from January 1, 2012. |
3 Administration expenses include share based compensation and exclude Corporate depreciation expense and social community costs not related to current operations. |
TERANGA GOLD CORPORATION | ||||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME / LOSS | ||||||
(US$000's except per share amounts) | ||||||
For the years ended December 31 | ||||||
2014 | 2013 | |||||
(Restated) | ||||||
Revenue | 260,588 | 297,927 | ||||
Cost of sales | (207,984 | ) | (193,434 | ) | ||
Gross profit | 52,604 | 104,493 | ||||
Exploration and evaluation expenditures | (2,772 | ) | (5,405 | ) | ||
Administration and corporate social responsibility expenses | (15,621 | ) | (14,717 | ) | ||
Share-based compensation | (911 | ) | (813 | ) | ||
Finance costs | (9,484 | ) | (12,148 | ) | ||
Gains on gold hedge contracts | - | 5,308 | ||||
Gains on oil hedge contracts | - | 31 | ||||
Net foreign exchange gains/(losses) | 2,013 | (1,233 | ) | |||
Loss on available for sale financial asset | - | (4,003 | ) | |||
Other expense | (1,982 | ) | (11,843 | ) | ||
(28,757 | ) | (44,823 | ) | |||
Profit before income tax | 23,847 | 59,670 | ||||
Income tax expense | (1,536 | ) | - | |||
Net profit | 22,311 | 59,670 | ||||
Profit attributable to: | ||||||
Shareholders | 17,776 | 50,280 | ||||
Non-controlling interests | 4,535 | 9,390 | ||||
Net profit for the year | 22,311 | 59,670 | ||||
Other comprehensive income: | ||||||
Items that may be reclassified subsequently to profit/loss for the year | ||||||
Change in fair value of available for sale financial asset, net of tax | (1 | ) | (6,418 | ) | ||
Reclassification to income, net of tax | - | 962 | ||||
Other comprehensive loss for the year | (1 | ) | (5,456 | ) | ||
Total comprehensive income for the year | 22,310 | 54,214 | ||||
Total comprehensive income attributable to: | ||||||
Shareholders | 17,775 | 44,824 | ||||
Non-controlling interests | 4,535 | 9,390 | ||||
Total comprehensive income for the year | 22,310 | 54,214 | ||||
Earnings per share from operations attributable to the shareholders of the Company during the year | ||||||
- basic earnings per share | 0.05 | 0.19 | ||||
- diluted earnings per share | 0.05 | 0.19 |
TERANGA GOLD CORPORATION | ||||
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION | ||||
(US$000's) | ||||
As at December 31, 2014 | As at December 31, 2013 | |||
(Restated) | ||||
Current assets | ||||
Cash and cash equivalents | 35,810 | 14,961 | ||
Restricted cash | - | 20,000 | ||
Trade and other receivables | 1,562 | 7,999 | ||
Inventories | 66,639 | 67,121 | ||
Other assets | 8,995 | 5,762 | ||
Total current assets | 113,006 | 115,843 | ||
Non-current assets | ||||
Inventories | 91,057 | 63,081 | ||
Equity accounted investment | - | 47,627 | ||
Property, plant and equipment | 198,433 | 219,540 | ||
Mine development expenditures | 260,719 | 181,605 | ||
Other non-current assets | 7,917 | 947 | ||
Goodwill | 55,191 | - | ||
Total non-current assets | 613,317 | 512,800 | ||
Total assets | 726,323 | 628,643 | ||
Current liabilities | ||||
Trade and other payables | 53,909 | 56,891 | ||
Borrowings | 3,946 | 70,423 | ||
Deferred revenue | 21,814 | - | ||
Provisions | 2,647 | 1,751 | ||
Total current liabilities | 82,316 | 129,065 | ||
Non-current liabilities | ||||
Borrowings | - | 3,946 | ||
Deferred revenue | 92,184 | - | ||
Provisions | 15,993 | 14,336 | ||
Deferred income tax liabilities | 1,536 | - | ||
Other non-current liabilities | 18,399 | 10,959 | ||
Total non-current liabilities | 128,112 | 29,241 | ||
Total liabilities | 210,428 | 158,306 | ||
Equity | ||||
Issued capital | 367,837 | 342,470 | ||
Foreign currency translation reserve | (998 | ) | (998 | ) |
Other components of equity | 16,255 | 15,776 | ||
Retained earnings | 118,337 | 100,561 | ||
Equity attributable to shareholders | 501,431 | 457,809 | ||
Non-controlling interests | 14,464 | 12,528 | ||
Total equity | 515,895 | 470,337 | ||
Total equity and liabilities | 726,323 | 628,643 |
TERANGA GOLD CORPORATION | |||||
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY | |||||
(US$000's) | |||||
For the years ended December 31 | |||||
2014 | 2013 | ||||
(Restated) | |||||
Issued capital | |||||
Beginning of year | 342,470 | 305,412 | |||
Shares issued from public and private offerings | 27,274 | 37,264 | |||
Less: Share issue costs | (1,907 | ) | (206 | ) | |
End of year | 367,837 | 342,470 | |||
Foreign currency translation reserve | |||||
Beginning of year | (998 | ) | (998 | ) | |
End of year | (998 | ) | (998 | ) | |
Other components of equity | |||||
Beginning of year | 15,776 | 21,814 | |||
Equity-settled share-based compensation reserve | 480 | 1,605 | |||
Investment revaluation reserve on change in fair value of available for sale financial asset, net of tax | (1 | ) | (5,456 | ) | |
Stock options to Oromin Explorations Ltd. ("Oromin") employees | - | 585 | |||
Acquisition of non-controlling interest in Oromin | - | (2,772 | ) | ||
End of year | 16,255 | 15,776 | |||
Retained earnings | |||||
Beginning of year | 100,561 | 50,281 | |||
Profit attributable to shareholders | 17,776 | 50,280 | |||
End of year | 118,337 | 100,561 | |||
Non-controlling interest | |||||
Beginning of year | 12,528 | 11,974 | |||
Non-controlling interest - portion of profit for the period | 4,535 | 9,390 | |||
Dividends accrued | (2,599 | ) | (8,836 | ) | |
End of year | 14,464 | 12,528 | |||
Total shareholders' equity as at December 31 | 515,895 | 470,337 |
TERANGA GOLD CORPORATION | ||||
CONSOLIDATED STATEMENTS OF CASH FLOW | ||||
(US$000's) | ||||
For the years ended December 31 | ||||
2014 | 2013 | |||
(Restated) | ||||
Cash flows related to operating activities | ||||
Profit for the year | 22,311 | 59,670 | ||
Depreciation of property, plant and equipment | 25,806 | 48,185 | ||
Depreciation of capitalized mine development costs | 44,062 | 30,722 | ||
Inventory movements - non-cash | (8,089 | ) | (14,672 | ) |
Capitalized deferred stripping - non-cash | (658 | ) | (4,124 | ) |
Amortization of intangibles | 714 | 1,021 | ||
Amortization of deferred financing costs | 3,275 | 3,120 | ||
Unwinding of discounts | 1,132 | 156 | ||
Share-based compensation | 911 | 813 | ||
Deferred gold revenue recognized | (21,002 | ) | - | |
Net change in gains on gold forward sales contracts | - | (42,955 | ) | |
Net change in losses on oil contracts | - | 456 | ||
Buyback of gold forward sales contracts | - | (8,593 | ) | |
Loss on available for sale financial asset | - | 4,003 | ||
Loss on disposal of property, plant and equipment | 1 | 102 | ||
Increase in inventories | (19,693 | ) | (8,409 | ) |
Changes in working capital other than inventory | 239 | 4,812 | ||
Net cash provided by operating activities | 49,009 | 74,307 | ||
Cash flows related to investing activities | ||||
Decrease/(increase) in restricted cash | 20,000 | (20,000 | ) | |
Acquisition of Oromin Joint Venture Group ("OJVG") | (112,500 | ) | - | |
Expenditures for property, plant and equipment | (3,567 | ) | (17,344 | ) |
Expenditures for mine development | (15,346 | ) | (51,603 | ) |
Acquisition of intangibles | - | (109 | ) | |
Proceeds on disposal of property, plant and equipment | - | 38 | ||
Net cash used in investing activities | (111,413 | ) | (89,018 | ) |
Cash flows related to financing activities | ||||
Net proceeds from equity offering | 25,367 | - | ||
Proceeds from Franco-Nevada gold stream | 135,000 | - | ||
Repayment of borrowings | (72,775 | ) | (12,282 | ) |
Drawdown from equipment finance facility, net of financing costs paid | - | 12,755 | ||
Financing costs paid | (1,000 | ) | (1,200 | ) |
Interest paid on borrowings | (3,340 | ) | (7,054 | ) |
Dividend payment to government of Senegal | - | (2,700 | ) | |
Net cash provided by / (used in) financing activities | 83,252 | (10,481 | ) | |
Effect of exchange rates on cash holdings in foreign currencies | 1 | 431 | ||
Net increase / (decrease) in cash and cash equivalents | 20,849 | (24,761 | ) | |
Cash and cash equivalents at the beginning of year | 14,961 | 39,722 | ||
Cash and cash equivalents at the end of year | 35,810 | 14,961 | ||
CORPORATE DIRECTORY
Directors
Alan Hill, Chairman
Richard Young, President and CEO
Jendayi Frazer, Non-Executive Director
Edward Goldenberg, Non-Executive Director
Christopher Lattanzi, Non-Executive Director
Alan Thomas, Non-Executive Director
Frank Wheatley, Non-Executive Director
Senior Management
Richard Young, President and CEO
Mark English, Vice President, Sabodala Operations
Paul Chawrun, Vice President, Technical Services
Navin Dyal, Vice President and CFO
David Savarie, Vice President, General Counsel & Corporate Secretary
Aziz Sy, General Manager, SGO & Vice President, Development Senegal
Registered Office
121 King Street West, Suite 2600
Toronto, Ontario, M5H 3T9, Canada
T: +1 416 594 0000
F: +1 416 594 0088
E: investor@terangagold.com
W: www.terangagold.com
Senegal Office
2K Plaza
Suite B4, 1er Etage
sis la Route due Meridien President
Dakar Almadies
T: +221 338 693 181
F: +221 338 603 683
Auditor
Ernst & Young LLP
Share Registries
Canada: Computershare Trust Company of Canada
T: +1 800 564 6253
Australia: Computershare Investor Services Pty Ltd
T: +1 300 850 505
Stock Exchange Listings
Toronto Stock Exchange, TSX symbol: TGZ
Australian Securities Exchange, ASX symbol: TGZ
Issued Capital | |
As of December 31, 2014 | |
Issued shares | 352,801,091 |
Stock options | 21,470,489 |
Exercise Prices (C$) | Options |
$3.00 | 13,723,889 |
$1.09 - $2.171 | 7,746,600 |
1Options expired on February 6, 2015. |
FORWARD LOOKING STATEMENTS
This news release contains certain statements that constitute forward-looking information within the meaning of applicable securities laws ("forward-looking statements"). Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Teranga, or developments in Teranga's business or in its industry, to differ materially from the anticipated results, performance, achievements or developments expressed or implied by such forward-looking statements. Forward-looking statements include, without limitation, all disclosure regarding possible events, conditions or results of operations, future economic conditions and courses of action, the proposed plans with respect to mine plan, anticipated 2015 results and consolidation of the Sabodala Gold Project and OJVG Golouma Gold Project, mineral reserve and mineral resource estimates, anticipated life of mine operating and financial results, the approval of the Gora ESIA and permitting and the completion of construction related thereto. Such statements are based upon assumptions, opinions and analysis made by management in light of its experience, current conditions and its expectations of future developments that management believe to be reasonable and relevant. These assumptions include, among other things, the ability to obtain any requisite Senegalese governmental approvals, the accuracy of mineral reserve and mineral resource estimates, gold price, exchange rates, fuel and energy costs, future economic conditions and courses of action. Teranga cautions you not to place undue reliance upon any such forward-looking statements, which speak only as of the date they are made. The risks and uncertainties that may affect forward-looking statements include, among others: the inherent risks involved in exploration and development of mineral properties, including government approvals and permitting, changes in economic conditions, changes in the worldwide price of gold and other key inputs, changes in mine plans and other factors, such as project execution delays, many of which are beyond the control of Teranga, as well as other risks and uncertainties which are more fully described in the Company's Annual Information Form dated March 31, 2014 (as revised April 24, 2014), and in other company filings with securities and regulatory authorities which are available at www.sedar.com. Teranga does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change. Nothing in this report should be construed as either an offer to sell or a solicitation to buy or sell Teranga securities.
COMPETENT PERSONS STATEMENT
The technical information contained in this document relating to the mineral reserve estimates for Sabodala, the ore stockpiles, Masato, Golouma and Kerekounda is based on, and fairly represents, information compiled by Mr. William Paul Chawrun, P. Eng who is a member of the Professional Engineers Ontario, which is currently included as a "Recognized Overseas Professional Organization" in a list promulgated by the ASX from time to time. Mr. Chawrun is a full-time employee of Teranga and is a "qualified person" as defined in NI 43-101 and a "competent person" as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr. Chawrun has sufficient experience relevant to the style of mineralization and type of deposit under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr. Chawrun has consented to the inclusion in this Report of the matters based on his compiled information in the form and context in which it appears in this Report.
The technical information contained in this document relating to the mineral reserve estimates for Gora and Niakafiri is based on, and fairly represents, information and supporting documentation prepared by Julia Martin, P.Eng. who is a member of the Professional Engineers of Ontario and a Member of AusIMM (CP). Ms. Martin is a full time employee with AMC Mining Consultants (Canada) Ltd., is independent of Teranga, is a "qualified person" as defined in NI 43-101 and a "competent person" as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Ms. Martin has sufficient experience relevant to the style of mineralization and type of deposit under consideration and to the activity she is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Ms. Martin is a "Qualified Person" under National Instrument 43-101 Standards of Disclosure for Mineral Projects. Ms. Martin has reviewed and accepts responsibility for the Mineral Reserve estimates for Gora and Niakafiri disclosed in this document and has consented to the inclusion of the matters based on her information in the form and context in which it appears in this Report
The technical information contained in this Report relating to mineral resource estimates for Niakafiri, Gora, Niakafiri West, Soukhoto, and Diadiako is based on, and fairly represents, information compiled by Ms. Patti Nakai-Lajoie. Ms. Nakai-Lajoie, P. Geo., is a Member of the Association of Professional Geoscientists of Ontario, which is currently included as a "Recognized Overseas Professional Organization" in a list promulgated by the ASX from time to time. Ms. Nakai-Lajoie is a full time employee of Teranga and is not "independent" within the meaning of National Instrument 43-101. Ms. Nakai-Lajoie has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and to the activity which she is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Ms. Nakai-Lajoie is a "Qualified Person" under National Instrument 43-101 Standards of Disclosure for Mineral Projects. Ms. Nakai-Lajoie has consented to the inclusion in this Report of the matters based on her compiled information in the form and context in which it appears in this Report.
The technical information contained in this Report relating to mineral resource estimates for Sabodala, Masato, Golouma, Kerekounda, and Somigol Other are based on, and fairly represents, information compiled by Ms. Patti Nakai-Lajoie. Ms. Nakai-Lajoie, P. Geo., is a Member of the Association of Professional Geoscientists of Ontario, which is currently included as a "Recognized Overseas Professional Organization" in a list promulgated by the ASX from time to time. Ms. Nakai-Lajoie is a full time employee of Teranga and is not "independent" within the meaning of National Instrument 43-101. Ms. Nakai-Lajoie has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and to the activity which she is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Ms. Nakai-Lajoie is a "Qualified Person" under National Instrument 43-101 Standards of Disclosure for Mineral Projects. Ms. Nakai-Lajoie has consented to the inclusion in this Report of the matters based on her compiled information in the form and context in which it appears in this Report.
Teranga's exploration programs are being managed by Peter Mann, FAusIMM. Mr. Mann is a full time employee of Teranga and is not "independent" within the meaning of National Instrument 43-101. Mr. Mann has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr. Mann is a "Qualified Person" under National Instrument 43-101 Standards of Disclosure for Mineral Projects. The technical information contained in this news release relating exploration results are based on, and fairly represents, information compiled by Mr. Mann. Mr. Mann has verified and approved the data disclosed in this release, including the sampling, analytical and test data underlying the information. The RC samples are prepared at site and assayed in the SGS laboratory located at the site. Analysis for diamond drilling is sent for fire assay analysis at ALS Johannesburg, South Africa. Mr. Mann has consented to the inclusion in this news release of the matters based on his compiled information in the form and context in which it appears herein.
Teranga's disclosure of mineral reserve and mineral resource information is governed by NI 43-101 under the guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum (the "CIM") Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as may be amended from time to time by the CIM ("CIM Standards"). CIM definitions of the terms "mineral reserve", "proven mineral reserve", "probable mineral reserve", "mineral resource", "measured mineral resource", "indicated mineral resource" and "inferred mineral resource", are substantially similar to the JORC Code corresponding definitions of the terms "ore reserve", "proved ore reserve", "probable ore reserve", "mineral resource", "measured mineral resource", "indicated mineral resource" and "inferred mineral resource", respectively. Estimates of mineral resources and mineral reserves prepared in accordance with the JORC Code would not be materially different if prepared in accordance with the CIM definitions applicable under NI 43-101. There can be no assurance that those portions of mineral resources that are not mineral reserves will ultimately be converted into mineral reserves.
NON-IFRS FINANCIAL PERFORMANCE MEASURES
The Company provides some non-IFRS measures as supplementary information that management believes may be useful to investors to explain the Company's financial results.
Beginning in the second quarter of 2013, we adopted an "all-in sustaining costs" measure and an "all-in costs" measure consistent with the guidance issued by the World Gold Council ("WGC") on June 27, 2013. The Company believes that the use of all-in sustaining costs and all-in costs will be helpful to analysts, investors and other stakeholders of the Company in assessing its operating performance, its ability to generate free cash flow from current operations and its overall value. These new measures will also be helpful to governments and local communities in understanding the economics of gold mining. The "all-in sustaining costs" is an extension of existing "cash cost" metrics and incorporate costs related to sustaining production. The "all-in costs" includes additional costs which reflect the varying costs of producing gold over the life-cycle of a mine.
"Total cash cost per ounce sold" is a common financial performance measure in the gold mining industry but has no standard meaning under IFRS. The Company reports total cash costs on a sales basis. We believe that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company's performance and ability to generate cash flow. Accordingly, it is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. The measure, along with sales, is considered to be a key indicator of a Company's ability to generate operating earnings and cash flow from its mining operations.
Total cash costs figures are calculated in accordance with a standard developed by The Gold Institute, which was a worldwide association of suppliers of gold and gold products and included leading North American gold producers. The Gold Institute ceased operations in 2002, but the standard is considered the accepted standard of reporting cash cost of production in North America. Adoption of the standard is voluntary and the cost measures presented may not be comparable to other similarly titled measure of other companies.
The WGC definition of all-in sustaining costs seeks to extend the definition of total cash costs by adding corporate general and administrative costs, reclamation and remediation costs (including accretion and amortization), exploration and study costs (capital and expensed), capitalized stripping costs and sustaining capital expenditures and represents the total costs of producing gold from current operations. The WGC definition of all-in costs adds to all-in sustaining costs including capital expenditures attributable to projects or mine expansions, exploration and study costs attributable to growth projects, and community and permitting costs not related to current operations. Both all-in sustaining and all- in costs exclude income tax payments, interest costs, costs related to business acquisitions and items needed to normalize earnings. Consequently, this measure is not representative of all of the Company's cash expenditures. In addition, the calculation of all-in sustaining costs and all-in costs does not include depreciation expense as it does not reflect the impact of expenditures incurred in prior periods. Therefore, it is not indicative of the Company's overall profitability.
"Total cash costs", "all-in sustaining costs" and "all-in costs" are intended to provide additional information only and do not have any standardized definition under IFRS and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. The measures are not necessarily indicative of operating profit or cash flow from operations as determined under IFRS. Other companies may calculate these measures differently. The following tables reconcile these non-GAAP measures to the most directly comparable IFRS measure.
"Average realized price" is a financial measure with no standard meaning under IFRS. Management uses this measure to better understand the price realized in each reporting period for gold and silver sales. Average realized price excludes from revenues unrealized gains and losses on non-hedge derivative contracts. The average realized price is intended to provide additional information only and does not have any standardized definition under IFRS; it should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. Other companies may calculate this measure differently.
"Total depreciation and amortization per ounce sold" is a common financial performance measure in the gold mining industry but has no standard meaning under IFRS. It is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.
ABOUT TERANGA
Teranga is a Canadian-based gold company listed on the Toronto Stock Exchange (TSX:TGZ) and Australian Securities Exchange (ASX:TGZ). Teranga is principally engaged in the production and sale of gold, as well as related activities such as exploration and mine development in Senegal, West Africa.
Teranga's mission is to create value for all of its stakeholders through responsible mining. Its vision is to explore, discover and develop gold mines in Senegal, in accordance with the highest international standards, and to be a catalyst for sustainable economic, environmental and community development. All of its actions from exploration, through development, operations and closure will be based on the best available techniques.
Senegal, which is located in West Africa, has a stable democracy, a progressive mining code and is a member of the West African Economic and Monetary Union. The Senegalese government views mining as a pillar of growth and supports mining companies by offering attractive royalty and ownership structures. Teranga operates the only gold mine and mill in Senegal.
Contact Information: