Silvermet Announces Record Production and Sales in 2012
10 Avril 2013 - 11:11PM
Marketwired Canada
THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT
AUTHORIZED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED STATES.
Silvermet Inc. ("Silvermet" or the "Company") (TSX VENTURE:SYI) is pleased to
announce financial and operating results for 2012.
Highlights (in US$)
-- 2012 was the highest year of production and sales since the start of
operations in 2009.
-- Silvermet continues to generate positive cash flow with a strengthening
working capital balance, no debt, relatively stable zinc prices and
smelter treatment charges.
-- 2012 sales in Dry Metric Tonnes ("DMT") increased by 35% to 20,153 DMT
of zinc concentrate, containing 29.6 million pounds of zinc, compared to
the 21.9 million pounds of zinc sold in 2011.
-- 2012 revenues increased by 26% to $22.1 million (at 100%) compared to
$17.6 million in 2011.
-- Cash costs declined by 10% to $0.57 per pound in 2012 from $0.63 per
pound in 2011.
-- Zinc recovery rates increased to 75% in 2012 from 67% in 2011.
-- 2012 production increased by 29% to 19,706 DMT zinc concentrate
(containing 67% zinc) compared to 2011 production of 15,328 DMT.
-- 2012 EBITDA increased by 37% to $4.6 million (at 100%) compared to $3.4
million in 2011, reflecting primarily increased zinc concentrate
shipments.
-- During 2012, Silvermet repurchased and cancelled 4,918,000 common shares
under the TSX Venture Exchange approved Normal Course Issuer Bid at an
average price of C$0.075.
-- Silvermet is debt free, cash flow positive and profitable.
The following table summarizes comparative annual results and reconciles net
income, an IFRS measure, to EBITDA.
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For the year ended December 31,
2012 2012 2011 2011
(all amounts in US$) 100% 49% 100% 49%
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Revenue $ 22,106,236 $ 10,832,056 $ 17,576,278 $ 8,612,376
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EBITDA(1) $ 4,619,522 $ 2,010,865 $ 3,359,682 $ 1,553,949
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Depreciation 346,962 349,688
Stock option expense 313,954 80,067
Finance expense - 153,710
Finance income (208,100) (230,255)
Other expense (income) 204,781 (600,050)
Income tax 418,414 311,762
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Net income $ 934,854 $ 1,489,027
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(1) EBITDA is a non-IFRS measure, does not have a standardized meaning
prescribed by IFRS and may not be comparable to similar terms and
measures presented by other issuers. EBITDA comprises earnings before
income taxes, interest expense (income) and financing expense
(including accretion of liabilities), amortization expense, foreign
exchange loss (gain), other expenses including gain on dilution and
stock option expense. The Company believes it is appropriate to exclude
stock option expense, gain on dilution and accretion of liabilities
from EBITDA as a measure of operating performance that excludes non-
recurring items.
The previously announced expansion plans in the Adana and Izmir regions of
Turkey are progressing well. Each plant is planned to have annual EAFD
processing capacity of 110,000 DMT and is estimated to cost $70 million to
construct, for a total investment of $140 million. The two new facilities will
have significantly higher EBITDA margins than the existing Iskenderun plant,
with the use of improved technology. When all three facilities are in
production, the total EAFD processing capacity will increase from the current
60,000 DMT per annum to 280,000 DMT and annual zinc concentrate production will
increase to 100,000 DMT containing approximately 150 million pounds of zinc.
The US$49 million project finance loan from EBRD will provide 70% of the
estimated US$70 million cost for the new Adana zinc plant, with the joint
venture partners contributing the remaining US$21 million (Silvermet's 49% share
- US$10.3 million). Silvermet is presently evaluating various funding
alternatives, including the use of cash on hand for part of this funding.
Construction of each plant is estimated to require 18 months. At present, it is
anticipated that permitting approval for the first plant in Adana, Turkey will
be received in Q2, 2013 with construction to begin shortly thereafter pending
closing of the financing agreement with EBRD. Construction of the Izmir plant is
expected to follow six months later.
With various announced zinc mine closures, most zinc industry analysts are
forecasting a tightening of zinc concentrate supply in the coming years. The
resulting downward pressure on smelter charges and upward trend on zinc prices
is expected to coincide with the commissioning of the new plants.
About Silvermet:
Silvermet's principal business activity is the recycling of electric arc furnace
dust ("EAFD"), a waste product created by steel mills, through a Waelz kiln to
produce a zinc concentrate that is sold to smelters throughout the world. The
Company owns 49% of Befesa Silvermet Turkey ("BST"), which operates a Waelz kiln
facility located in Iskenderun, Turkey.
Additional Information:
Additional information can be accessed at the Company's website www.silvermet.ca
or through the Company's public filings at www.sedar.com.
Caution concerning forward-looking statements: The information in this release
may contain forward-looking information under applicable securities laws. This
forward-looking information is subject to known and unknown risks, uncertainties
and other factors that may cause actual results to differ materially from those
implied by the forward-looking information. Factors that may cause actual
results to vary include, but are not limited to, inaccurate assumptions
concerning the exploration for and development of mineral deposits, political
instability, currency fluctuations, unanticipated operational or technical
difficulties, changes in laws or regulations, the risks of obtaining necessary
licenses and permits, changes in general economic conditions or conditions in
the financial markets and the inability to raised additional financing. Readers
are cautioned not to place undue reliance on this forward-looking information.
The Company does not assume the obligation to revise or update this
forward-looking information after the date of this release or to revise such
information to reflect the occurrence of future unanticipated events except as
may be required under applicable securities laws. The TSX Venture Exchange does
not accept responsibility for the adequacy or accuracy of this release.
FOR FURTHER INFORMATION PLEASE CONTACT:
Silvermet Inc.
Stephen G. Roman
Chairman, President & CEO
1 (416) 203-8336
info@silvermet.ca
Silvermet Inc.
Ian D. Atacan
Chief Financial Officer
1 (416) 203-8336
iatacan@silvermet.ca
www.silvermet.ca
Silvermet Inc. (TSXV:SYI)
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