ALIEN METALS LIMITED
Not for Distribution to U.S. Newswire services
nor for Distribution in the United States
Trading Symbols
AIM: AGQ
TSX-V: AGQ
FWB: I3A
28 May 2015
ARIAN SILVER'S MD&A AND FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED 31 MARCH 2015
Arian Silver Corporation ("Arian Silver" or the "Company"), a silver
exploration, development and production company with a focus on projects in the
silver belt of Zacatecas, Mexico, announces today the release of its
Management's Discussion and Analysis ("MD&A") and unaudited Financial
Statements ("Financials") for the three months ended 31 March 2015.
The MD&A and audited Financials will be available at SEDAR at www.sedar.com and
on the Company's website at www.ariansilver.com. These documents can also be
obtained on application to the Company. The following information has been
extracted from the MD&A and Financials. The financial information in this
announcement does not constitute full statutory accounts.
Arian Silver's Chief Executive Officer, Jim Williams, commented today, "Arian
Silver has continued to deliver on its objectives during 2015. The
refurbishment of our processing plant was completed successfully and it is now
in a commissioning phase with first silver-lead concentrates having been
produced. Looking ahead, I expect to report on exploration results and slightly
longer-term, on the ramp-up of production throughout the rest of the year and
into 2016. I especially look forward to Arian Silver being recognised by
investors as a producing mining company in due course."
The Strategy
The Company's strategy is to:
* establish a silver mining business capable of sustaining more than two
million ounces per annum, and
* build shareholder value by expanding silver resources on the Company's
mining concessions in Zacatecas, Mexico.
Overview of first quarter 2015
During the quarter, the Company commenced the phased commissioning programme of
La Tesorera processing plant (the "Plant"), which saw first concentrate
produced from the first of two flotation circuits.
Highlights
* Mechanical completion of the Plant
* Plant commissioning commenced
* First concentrate was produced from the Plant
* 5,000 metre exploration programme at Guanajuatillo section of the San José
mine
Overview of financial performance
Three Three
months months
ended ended Change
31 March 31 March
2015 2014
$000s $000s $000s
Gross loss - (13) 13
Net profit/(loss) for the period 1,898 (1,053) 2,951
As at As at
31 March 31 Dec
2015 2014 Change
$000s $000s $000s
Cash and cash equivalents 2,416 2,846 (430)
Total assets 39,360 35,865 3,495
During the period the Company drew down $4.1 million in accordance with the
terms of the Base Metals Purchase Agreement ("BMPA") with Quintana San Jose
Streaming Co. LLC ("Quintana Streaming").
The production and revenue received from first concentrate will be recognised
in the Company's second quarter results.
Total assets increased since 31 December 2014 as a result of the continued
investment in the mine and Plant and the capitalisation of interest for the
period. The movement in the Company's cash balance reflects the drawdown under
the BMPA, the continued investment in the mine and Plant together with general
corporate and administrative expenditures.
The increased net profit was primarily due to the fair value adjustment
relating to the derivative liability (this is explained further in note 7 to
the Financial Statements).
Overview of operational performance
Q1 2015 Q4 2014 Q3 2014 Q2 2014
Head grade - Ag grams per tonne (g/ - - - -
t)
Tonnes mined 5,719 (695) - 1,588
Tonnes milled - - - -
Silver concentrate tonnes produced - - - -
Recovery % - - - -
Silver ounces produced - - - -
Silver ounces per concentrate tonne - - - -
produced
Silver ounces sold - - - -
Silver concentrate tonnes sold - - - -
Quarter end inventory balances
Mined tonnes stockpile 39,366 33,647 34,342 34,342
Silver concentrate inventory tonnes - - - -
Silver ounces included in - - - -
concentrate inventory
Q1 2014 Q4 2013 Q3 2013 Q2 2013
Head grade - Ag grams per tonne (g/ - - - 191
t)
Tonnes mined 5,739 8,057 1,816 4,628
Tonnes milled - - - 3,221
Silver concentrate tonnes produced - - - 43
Recovery % - - - 41.42
Silver ounces produced - - - 8,180
Silver ounces per concentrate tonne - - - 190
produced
Silver ounces sold - - - 9,058
Silver concentrate tonnes sold - - - 37
Quarter end inventory balances
Mined tonnes stockpile 32,754 27,015 18,958 17,142
Silver concentrate inventory tonnes - - - 4
Silver ounces included in - - - 1,204
concentrate inventory
The refurbishment and installation of the Plant was completed during Q1 2015,
at which time the commissioning phase commenced, which was continuing at period
end.
An exploration drilling programme was undertaken within the Guanajuatillo
section of the San José vein. Guanajuatillo is located in the middle of the 2km
long vein structure with evidence of the vein to either side. The intention of
the drilling programme was to upgrade the inferred resource within that area to
measured or indicated, with a view to upgrading the Company's NI 43-101
compliant mineral resource estimate.
In preparation for increased mining rates in future, the construction of an
additional decline ramp close to Guanajuatillo commenced.
Comparison of quarter year-on-year
Q1 2015 Q1 2014 Change
Head grade - Ag grams per tonne - - -
Tonnes mined 5,719 5,739 -
Tonnes milled - - -
Silver concentrate tonnes produced - - -
Silver ounces produced - - -
Silver ounces per concentrate tonne - - -
produced
Subsequent events
Funding
Cash of $1.8 million was received in April 2015 pursuant to the terms of the
BMPA. The Company has now received $13.6 million of the $15.6 million committed
by Quintana Streaming.
Review of financial performance
Summary of quarterly results
The Company's focus during the quarter was the completion of refurbishment and
installation of the Plant, and the commencement of its commissioning. During
the quarter, two significant milestones were achieved, being the mechanical
completion of the Plant and the production of first silver-lead concentrate.
Revenues in respect of the first concentrate sales will be reported in Q2 2015.
Unaudited Q1 2015 Q4 2014 Q3 2014 Q2 2014
$'000 $'000 $'000 $'000
Revenue - - - -
Cost of sales - (65) (223) (140)
Gross loss - (65) (223) (140)
Net investment (loss)/income (6) 2 7 (2)
Net profit/(loss) for the period 1,898 (2,951) (1,211) (699)
Basic and diluted profit/(loss) per $0.06 ($0.09) ($0.04) ($0.02)
share
Total assets 39,360 35,865 30,352 30,687
Total current liabilities (6,398) (6,789) (17,606) (16,127)
Total non-current liabilities (20,471) (17,718) (195) (192)
Shareholders' equity (12,491) (11,358) (12,551) (14,368)
Unaudited Q1 2014 Q4 2013 Q3 2013 Q2 2013
$'000 $'000 $'000 $'000
Revenue - - - 129
Cost of sales (13) (49) (25) (413)
Gross loss (13) (49) (25) (284)
Net investment income/(loss) 2 1 44 (68)
Net profit/(loss) for the period (1,053) (583) 875 (947)
Basic and diluted profit/(loss) per ($0.03) ($0.02) $0.03 ($0.03)
share
Total assets 29,454 28,366 27,361 14,582
Total current liabilities (14,422) (12,395) (11,459) (986)
Total non-current liabilities (190) (187) (185) (182)
Shareholders' equity (14,842) (15,784) (15,717) (13,414)
Future outlook
The Company is currently commissioning its recently refurbished processing
plant. This, together with the planned ramp-up to maximum processing capacity
of 1,500 tonnes per day over the coming months, and achievement of consistent
production thereafter sees the Company firmly on the path to achieving its
long-term strategy.
The Plant is projected to deliver substantial cost savings against the
Company's previous toll milling operations. With reduced operating costs, the
Company should enjoy significantly higher operating margins than would have
been achieved in the past under the same conditions.
For further information please contact:
Arian Silver Corporation
Jim Williams, CEO
David Taylor, Company Secretary Northland Capital Partners Limited
Fuad Sillem, Head of Corporate Gerry Beaney / John Howes
Development (London) +44 (0)20 7382 1100
(London) +44 (0)20 7887 6599
fsillem@ariansilver.com
OR
OR
Grant Thornton UK LLP Yellow Jersey PR Limited
Philip Secrett / Richard Tonthat Dominic Barretto
(London) +44 (0)20 7383 5100 (London) +44 (0)7768 537 739
philip.j.secrett@uk.gt.com dominic@yellowjerseypr.com
Forward-Looking Information:
Certain information contained herein constitutes forward-looking statements.
Forward-looking statements are frequently characterised by words such as
"planned", "expected", "forecast", "projected", "intended", "believe",
"anticipate", "budget", "scheduled", "outlook" and other similar words or
statements that certain events or conditions may or will occur.
Forward-looking statements are based on the opinions and estimates of
management at the dates the statements are made, and are subject to a variety
of risks and uncertainties and other factors that could cause actual events or
results to differ materially from those projected in the forward-looking
statements.
These factors include the inherent risks involved in exploration and
development, and mining of mineral properties, the uncertainties involved in
interpreting drilling results and other geological data, fluctuating metal
prices, the possibility of project cost overruns or unanticipated operating
costs and expenses, uncertainties related to the necessity of financing, the
availability of and costs of financing needed in the future, and other factors
described in the Company's MD&A under the heading "Risk Factors and
Uncertainties".
The Company undertakes no obligation to update forward-looking statements if
circumstances or management's estimates or opinions should change, other than
as required by securities laws. The reader is cautioned not to place undue
reliance on forward-looking statements (including, without limitation,
statements relating to the mineral resource estimates, statements regarding the
San José Project, the ability of the Company to achieve, maintain and possibly
increase planned levels of production, and the ability of the Company to
generate positive cash flow from the San José Project, the ability to continue
or implement proposed drilling programmes on the San José vein system and the
Company's exploration, development and production plans and objectives), or the
ability of the Company to raise additional funds should they be required.
These forward-looking statements reflect the current expectations or beliefs of
the Company based on information currently available to the Company.
Forward-looking statements are subject to a number of risks and uncertainties
that may cause the actual results of the Company to differ materially from
those discussed in the forward-looking statements, and even if such actual
results are realised or substantially realised, there can be no assurance that
they will have the expected consequences to, or effects on the Company. Factors
that could cause actual results or events to differ materially from current
expectations include, among other things, the performance of contractors and
plant and equipment, and failure to achieve anticipated production levels and
mineral grades for ore from the San José Project, failure to establish
estimated mineral reserves, the possibility that future exploration results
will not be consistent with the Company's expectations, uncertainties relating
to the availability and costs of financing needed in the future, changes in the
silver commodity price, changes in equity markets, political developments in
Mexico, changes to regulations affecting the Company's activities, delays in
obtaining or failures to obtain required regulatory approvals, the
uncertainties involved in interpreting exploration results and other geological
data, and the other risks involved in the mineral exploration and development
industry.
Any forward-looking statement speaks only as of the date on which it is made
and, except as may be required by applicable securities laws, the Company
disclaims any intent or obligation to update any forward-looking statement,
whether as a result of new information, future events or results or otherwise.
Although the Company believes that the assumptions inherent in the
forward-looking statements are reasonable, forward-looking statements are not
guarantees of future performance and accordingly undue reliance should not be
put on such statements due to the inherent uncertainty therein.
Any mineral resource figures disclosed are estimates and no assurances can be
given that the indicated levels of minerals will be produced. Such estimates
are expressions of judgement based on knowledge, mining experience, analysis of
drilling results and industry practices. Valid estimates made at a given time
may significantly change when new information becomes available. While the
Company believes that the resource estimates are well established, by their
nature resource estimates are imprecise and depend, to a certain extent, upon
statistical inferences, which may ultimately prove unreliable. If such
estimates are inaccurate or are reduced in the future, this could have a
material adverse impact on the Company.
Mineral resources are not mineral reserves and do not have demonstrated
economic viability. There is no certainty that mineral resources can be
upgraded to mineral reserves through continued exploration.
This press release does not constitute an offer to sell or a solicitation of an
offer to buy any of the securities of the Company in the United Sates. The
securities of the Company have not been and will not be registered under the
United States Securities Act of 1933, as amended (the "U.S. Securities Act") or
any state securities laws and may not be offered or sold within the United
States or to U.S. persons unless registered under the U.S. Securities Act and
applicable state securities laws or an exemption from such registration is
available.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that
term is defined in the policies of the TSX Venture Exchange) and no stock
exchange, securities commission or other regulatory authority accepts
responsibility for the adequacy or accuracy of this release nor approved or
disapproved of the information contained herein.
Arian Silver : MD&A and Results for the 3 Months Ended 31 March 2015
May 28, 2015 at 02:01 am EDT
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