KOPY GOLDFIELDS AB Q1 JANUARY –
- Revenue up 32% to TUSD 25,654 driven by 23% higher sales volumes and 8% higher gold price
- Gross profit up 92% to TUSD 13,960. Gross margin increased to 54% (38% in Q1 2021)
- EBITDA increased by 55% to TUSD 11,142. EBITDA margin increased to 43% (37% in Q1 2021)
- Net financial items decreased to TUSD – 7,073 (TUSD 5,312) due to non-cash unrealized losses from gold hedges of TUSD -6,350 (gain of TUSD 6,167 in Q1 2021), which affects the comparability between the quarters by TUSD -12,518.
- Profit for the period amounted to TUSD 3,700 (TUSD 7,870 in Q1 2021)
- The Company confirms 2022 gold production guidance of 52-57 koz (unchanged)
Significant events after the reporting period
- In
April 2022 ,Kopy Goldfields completed a directed new share issue, raising proceeds of MSEK 8.1 before issue costs (equivalent of approximately TUSD 860 at the date of the transaction) to secure the parent company's liquidity.
SUMMARY OF FINANCIAL INFORMATION
| Q1 2022 | Q1 2021 | Δ % | FY 2021 | |
| Gold production (gold equivalent), koz | 7.24 | 7.69 | -6% | 51.61 |
| Gold sales (gold equivalent), koz | 13.49 | 10.99 | 23% | 49.81 |
| Average realized gold price, USD/oz | 1,887 | 1,754 | 8% | 1,783 |
| Revenue, TUSD | 25,654 | 19,362 | 32% | 89,578 |
| Gross profit, TUSD | 13,960 | 7,284 | 92% | 24,421 |
| Gross margin, % | 54% | 38% | 27% | |
| EBITDA, TUSD | 11,142 | 7,181 | 55% | 36,899 |
| EBITDA margin, % | 43% | 37% | 41% | |
| Profit for the period, TUSD | 3,700 | 7,870 | -53% | 7,715 |
| Earnings per share before dilution, USD | 0.00 | 0.01 | 0.01 | |
| Cash flow from operating activities before changes in working capital, TUSD | 11,120 | 7,179 | 55% | 36,636 |
| Total investments, TUSD | 9,953 | 9,428 | 6% | 28,376 |
| Cash & cash equivalents at the end of the period, TUSD | 3,563 | 792 | 350% | 6,145 |
| Net debt, TUSD | 61,509 | 50,890 | 21% | 60,637 |
| Net debt/LTM EBITDA, x | 1,51 | 1.17 | 44% | 1.64 |
| Equity per share, USD | 0.11 | 0.11 | 0.12 |
Comments from the CEO
Solid financial performance from stable operations and supportive gold market
Since
Increased monetary restrictions and regulations affect and complicate cross-border transactions and transfers. To secure gold sales channels, Kopy has increased the number of Russian banks to use for domestical gold sales, and to have more options and flexibility to get the best price, we have received an export license for selling gold outside
Production
Kopy Goldfields’ gold equivalent production in the first quarter 2022 decreased by 6% compared to the same quarter last year, totaling 7.24 koz compared to 7.69 koz. The decrease is a result of the expected production decrease at Perevalnoe project following depletion of the open pit mine. This decrease was partially offset by a 66% increase in production at the Yubileyniy plant which is picking up production following the upgrade in Q4 2021. During Q1, Yubileyniy has gradually been increasing production towards the full extended processing capacity of 250 ktpa, which was reached in
Financial performance
Higher volumes of gold sales in combination with increased gold price, increased our revenue by 32% compared to the first quarter 2021 and amounted to TUSD 25,654. Sales volumes increased to 13.49 koz of gold following sales of gold from stock in order to capitalize on the favorable gold price environment. Our average achieved gold price during the quarter amounted to
Investments
Our main development focus in 2022 is the Malyutka project. The commissioning of this major growth driver will be next milestone in reaching our production target of 100 koz of gold in 2025. Maluytka, located in 230 km away from Yubileyniy by straight line, is an open pit deposit where we expect to add significant gold production in coming years. The developments on site began in 2020. By the end of Q1, we are on track with the construction schedule and expect to commence production at Malyutka in the second part of 2023 with full capacity to be reached in 2024. As always, we took advantage of the winter roads and completed this year’s winter procurement campaign by mid April. The main development activities in 2022 include construction of an accommodation camp with dormitories, offices, canteen, workshop, fuel storage and other supporting facilities. The foundation for hydrometallurgy processing plant will be prepared and an assay tests lab and storage facilities will be built. During 2022, six sections of heap leach pads are planned to be constructed, as well as installation of ore crashers. Open pit mine development has already commenced in April this year.
ESG
In beginning of May, we published our first sustainability report. Kopy Goldfields’ mission is to be a responsible gold miner that creates value and benefits for all stakeholders and contributes to a sustainable future. You find the report on our web site.
During 2022, we will proceed with improving the health and safety operational practices, developing a new tailing storage, enhancing waste utilization, and increasing efficiency of energy consumption.
Outlook
We expect to be able to increase gold production during the second quarter. The Yubileyniy plant currently operates at full capacity. With the arrival of the warm season, we launch alluvial and heap leach operations. While heap leaching at the Yubileyniy site was commenced two years ago, 2022 is the first year for the new heap leach plant at Perevalnoe. In summary, we remain on track towards our short and long term production targets.
Mikhail Damrin
CEO
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