VANCOUVER, BRITISH COLUMBIA (OTCBB: RCTFF)(FRANKFURT: R5I):
Rochester Resources Ltd. is pleased to announce financial results
for the quarter ended February 29th, 2008. The Company realized net
revenue of $2,507,487 on 3,302 ounces of gold equivalent shipped
during the three months ended Feb. 29, 2008 (the 2008 third
quarter), and generated an operating profit of $213,538 after
non-cash charges for depletion and amortization of $248,301. During
the 2008 third quarter, head grades averaged approximately 6 g/t
gold and 140 g/t silver. Recovery rates for gold surpassed 90 per
cent, and silver recovery remained in the 50 per cent range.
"We expect an improvement in net revenues and profitability as
we reduce operating costs, improve recovery rates and increase head
grades over the coming months. This will all coincide with our
increase in throughput production to 300 tpd and implementation of
our improved silver recovery circuit planned for the 3rd quarter of
calendar 2008." commented Dr. Parra.
The Company recognized net revenue during the nine month period
ended February 29th, 2008 of $7,262,014 generated on the sale of
9,693 ounces of gold equivalents, for an average of $749 net
revenue per ounce (net of royalty and treatment charges).
Revenues in the 3rd quarter were below plan as a result of
several factors, including poor recovery of free gold and silver in
the circuit as well as higher dilution during mining. In January
when working on alternatives for increasing silver recovery it was
found that the amount of free gold and silver in the circuit had
increased and was not being recovered during the cyanidation
process. By Q3 2008 we will have a gravimetric circuit in place to
address this problem and increase silver recoveries up to 70 to
80%. Production from the mine has also been negatively impacted by
the failure to achieve targeted development workings. This was
caused in part by mine equipment maintenance challenges,
specifically the lack of availability of spare parts and qualified
mechanics, resulting in overall availability of scoop trams of
approximately 30%. The original mine plan called for the mine
development to continue in conjunction with production. In order to
maintain throughput to the mill with grade control, a minimum of
500 metres of drift development is required each month. If
development of 500 metres is not achieved, the consequence is that
there are fewer locations from which to produce and less
flexibility to maintain optimum grade. With scoop tram availability
of approximately 30% actual mine development has been proceeding at
a rate of 300 metres per month and consequently the development of
an insufficient number of workings from which to mine higher grade
ore. During the quarter an order was placed for two new scoop trams
and when both are in service availability will increase
significantly. The first scoop tram arrived and was placed into
service in March with the second due in the next two weeks.
Furthermore, the decision has been made to establish a service
center in the city of Tepic, located just under two hours from the
mine to address spare parts and maintenance issues in a timely
manner.
The immediate priority is to carry out sufficient development
work to ensure that the ore required to feed the mill at 300 tonnes
per day is available with a head grade of 8.5 grams of gold and 150
grams of silver per tonne. Florida NW, where exploration efforts
have recently identified seven new veins, will be the focus of
development work in the coming months. We are projecting that the
plant expansion will be complete and running at 300 tonnes per day
in the 3rd quarter of calendar 2008. Once this priority project is
completed we plan to resume the exploration programs at Tajos
Cuates and Santa Fe.
During the nine months ended February 29, 2008 (the "2008
period") the Company reported an operating profit of $1,045,562 and
a net loss of $1.501 million of which $1.4 million was stock based
compensation, compared to a net loss of $3,083,491 for the nine
months ended February 28, 2007 (the "2007 period"), a decrease in
loss of $1,582,491. The periods are not comparable as the Company
was not in commercial production prior to June 1, 2007 and had no
production in the corresponding 2007 period. As a result, no
depletion on mineral property interests or amortization on
property, plant and equipment was taken until the 2008 period.
As of Feb. 29, 2008, the company had working capital of
$2,215,461. "We are in the position of having a strong balance
sheet supported by the ability to generate meaningful cash flow
from our mining and milling activities. We expect a substantial
increase in sales and revenue once we implement the planned
increase to 300 tpd. These revenues will enable us to increase our
exploration and development programs, as well as provide adequate
working capital for ongoing operations," stated Dr. Parra.
Webcast Event:
Rochester Resources Ltd. will host a teleconference call/webcast
to provide an overview of the company's developments and the
strategic plan for 2008. This will be followed up by a question and
answer session.
Event Time: Wednesday, April 30, 2008 @ 4:30pm Eastern Standard
Time (EST, GMT-5 hours).
Event Title: Rochester Resources Ltd Webcast Conference Call
Teleconference Information:
If you would like to participate and have any questions for Dr.
Parra please call:
Live Participant Dial In (Toll Free): 877-407-0778
Live Participant Dial In (International): 201-689-8565
To access the event on the web please click on the following URL
at:
http://www.investorcalendar.com/IC/CEPage.asp?ID=129071.
Investors can also access the webcast at
http://www.investorcalendar.com/.
An audio replay of the conference call will be available on
Rochester's website at www.rochesterresources.com following the
conference call.
Dr. Parra is currently the Company's in-house Qualified Person
and QP Member of the Mining and Metallurgical Society of America
with special expertise in Mining.
ON BEHALF OF THE BOARD
Dr. Alfredo Parra, President and CEO
About Rochester Resources Ltd.:
Rochester represents a pure-play in the exploration and
development of high-grade gold and silver properties located in
Nayarit, Mexico. The Company is a niche player in Mexico which has
assembled an attractive portfolio of properties in the Sierra Madre
Occidental Range. This is the largest epithermal precious metal
region in the world, hosting the majority of Mexico's large tonnage
gold and silver deposits. Current production generates growing cash
flow and helps fund our ongoing exploration and development with
minimum share dilution.
We have identified 37 vein structures on our two Projects (Mina
Real and Santa Fe) and recently embarked on an aggressive follow-up
exploration program including a 7000m drill program and a 2000m
drift development program that will determine the next steps for
mine development and production levels. Little follow-up work has
been completed to date on the vein structures identified across
both Projects.
Rochester is well positioned to advance its Projects and can
very quickly become a significant player in Mexico. Rochester has a
strong senior management team based in Mexico, a workforce in place
to advance its projects through to mine development, and strong
financial backing to implement and advance our work programs.
Forward Looking Statements
This Company Press Release contains certain "forward-looking"
statements and information relating to the Company that are based
on the beliefs of the Company's management as well as assumptions
made by and information currently available to the Company's
management. Such statements reflect the current risks,
uncertainties and assumptions related to certain factors including,
without limitations, competitive factors, general economic
conditions, customer relations, relationships with vendors and
strategic partners, the interest rate environment, governmental
regulation and supervision, seasonality, technological change,
changes in industry practices, and one-time events. In addition,
the Company has not conducted an independent feasibility study on
the Mina Real project which may increase the risk that the planned
operations are not economically viable. Should any one or more of
these risks or uncertainties materialize, or should any underlying
assumptions prove incorrect, actual results may vary materially
from those described herein.
The TSX Venture Exchange has not reviewed and does not accept
responsibility for the adequacy or the accuracy of this
release.
Contacts: Empire Communications Inc. Investor Information
Contact 1-866-841-0068 Email: info@rochesterresources.com Website:
www.rochesterresources.com
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