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Atico Reports Consolidated Financial Results for Third Quarter of 2023

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Atico Reports Consolidated Financial Results for Third Quarter of 2023

 

 

 

 

 

Atico Mining Corporation  (TSX-V: ATY) (OTCQX: ATCMF) announced its financial results for the three months ended September 30, 2023, posting a net loss of $1.1 million. Production for the period at Atico’s El Roble mine totaled 3.8 million pounds of copper and 2,724 ounces of gold in concentrate at a cash cost(1) of $1.97 per payable pound of copper(2).

 

Fernando E. Ganoza, CEO and Director, commented, “During the quarter we saw a significant improvement in ore production and grades at El Roble when compared to previous quarters in the year. However, these operational gains were almost completely offset by strong appreciation of the Colombian peso along with weaker metal prices and macroeconomic inflation which have put pressure on our production costs and margins” said Fernando E. Ganoza, CEO. “For the remainder of the year we will continue looking for further gains in operational efficiency while at the same time capture revenue from produced concentrates carrier forward into the subsequent quarter.”

 

Third Quarter Financial Highlights

  • Net loss for the quarter amounted to $1.1 million, compared to net income of $0.3 million for the comparative quarter.
  • Sales for the quarter decreased 34% to $15.3 million when compared with $23.1 million in Q3-2022. Copper and gold accounted for 80% and 20% of the 8,325 (Q3-2022 – 14,219) dry metric tonnes of concentrate sold during Q3-2023.
  • The average realized price per metal was $3.87 per pound of copper and $1,936 per ounce of gold.
  • Ending working capital was $12.2 million and the Company had $15.9 million in long-term loans payable.
  • Cash costs (1) were $131.82 per tonne of processed ore (Q3-2022 – $134.52) and $1.97 per pound of payable copper produced (Q3-2022 – $1.35). The increase in cash cost per pound of payable copper produced compared to the comparative period is due to lower copper grade and lower gold (by-product) credits due to lower grade.
  • Cash margin was $1.90 (Q3-2022 – $2.05) per pound of payable copper produced, which was a decrease of 11% over Q3-2022 due to higher cash cost per pound more than offsetting higher realized copper price.
  • All-in sustaining cash cost per payable pound of copper produced(1)(2) was $2.64 (Q3-2022 – $2.12).

 

Third Quarter Summary of Financial Results

 

   
Q3

2023
 
Q3

2022
 
%

Change
 
Revenue   $ 15,279,950   $ 23,123,099   (34%)  
Cost of sales     (13,225,475)     (17,626,532)   (25%)  
Income from mining operations     2,054,475     5,496,567   (63%)  
As a % of revenue     13%     24%    
General and administrative expenses     1,476,254     1,484,734   (1%)  
Income from operations     468,178     3,832,094   (88%)  
As a % of revenue     3%     17%    
Income before income taxes     332,420     2,646,391   (87%)  
Net income (loss)     (1,063,401)     297,615   (457%)  
As a % of revenue     (7%)     1%    
Operating cash flow before changes in non-cash operating working capital items(1)   $ 2,655,490   $ 7,023,139   (62%)  
 

 

Third Quarter Operational Review

 

In Q3-2023, the Company produced 3.8 million lbs of copper, 2,724 oz of gold, and 10,193 oz of silver. When compared to the same period in 2022, production increased by 1% for copper and stayed at the same level for gold. Average copper head-grades decreased by 21% and gold head-grades decreased by 20% relative to the same period in 2022, offsetting the 25% increase in tonnes of processed ore.

 

Third Quarter Operational Details

 

   
Q3

2023
 
Q3

2022
 
%

Change
 
Production (Contained metals)(3)            
Copper (000s lbs)   3,762   3,753   1%  
Gold (oz)   2,724   2,724   0%  
Silver (oz)   10,193   9,501   7%  
Mine            
Tonnes of material mined   77,947   66,245   18%  
Mill            
Tonnes processed   74,580   59,689   25%  
Tonnes processed per day   888   786   13%  
Copper grade (%)   2.46   3.12   (21%)  
Gold grade (g/t)   1.83   2.28   (20%)  
Silver grade (g/t)   10.13   10.15   0%  
Recoveries            
Copper (%)   93.0   91.5   2%  
Gold (%)   61.9   62.0   0%  
Silver (%)   41.0   48.8   (16%)  
Concentrates            
Copper Concentrates (DMT)   9,340   9,048   3%  
Copper (%)   18.3   18.8   (3%)  
Gold (g/t)   9.0   9.4   (4%)  
Silver (g/t)   33.2   32.7   2%  
             
Payable copper produced (000s lbs)   3,537   3,565   (1%)  
Cash cost per pound of payable copper ($/lbs)(1)(2)   1.97   1.35   46%  
 

 

The financial statements and MD&A are available on SEDAR and have also been posted on the Company’s website at http://www.aticomining.com/s/FinancialStatements.asp

 

El Roble Mine

 

The El Roble mine is a high grade, underground copper and gold mine with nominal processing plant capacity of 1,000 tonnes per day, located in the Department of Choco in Colombia. Its commercial product is a copper-gold concentrate.

 

Since obtaining control of the mine on November 22, 2013, Atico has upgraded the operation from a historical nominal capacity of 400 tonnes per day.

 

El Roble has Proven and Probable reserves of 1.00 million tonnes grading 3.02% copper and 1.76 g/t gold, at a cut-off grade of 1.3% copper equivalent with an effective date of September 30, 2020. Mineralization is open at depth and along strike and the Company plans to further test the limits of the deposit. On the larger land package, the Company has identified a prospective stratigraphic contact between volcanic rocks and black and grey pelagic sediments and cherts that has been traced by Atico geologists for ten kilometers. This contact has been determined to be an important control on VMS mineralization on which Atico has identified numerous target areas prospective for VMS type mineralization occurrence, which is the focus of the current surface drill program at El Roble.

 

La Plata Overview

 

Atico’s wholly-owned La Plata project is a gold rich volcanogenic massive sulphide deposit that was the subject of small-scale mining from 1975-1981 by Outokumpu Finland. The project benefits from a modern drill and exploration database which was completed by Cambior Inc. from 1996-1999, Cornerstone Capital from 2006-2009 and Toachi from 2016-2019.

 

Toachi Mining completed a PEA estimating an inferred resource of 1.85 million tonnes grading 4.10 grams gold per tonne, 50.0 grams silver per tonne, 3.30% copper, 4.60% zinc and 0.60% lead per tonne.

 

The La Plata project consists two concessions covering a total area of 2,235 hectares along its 4-kilometer length, which contains known mineralization in two VMS lenses and nine priority exploration targets.

 

Qualified Person

 

Mr. Thomas Kelly (SME Registered Member 1696580), advisor to the Company and a qualified person under National Instrument 43-101 standards, is responsible for ensuring that the technical information contained in this news release is an accurate summary of the original reports and data provided to or developed by Atico.

 

About Atico Mining Corporation

 

Atico is a growth-oriented Company, focused on exploring, developing and mining copper and gold projects in Latin America. The Company generates significant cash flow through the operation of the El Roble mine and is developing it’s high-grade La Plata VMS project in Ecuador. The Company is also pursuing additional acquisition of advanced stage opportunities.

 

Posted November 15, 2023

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