Golden Minerals Company (NYSE-A: AUMN) (TSX: AUMN) has released financial results and a business summary for the quarter ending September 30, 2023. (All figures are in approximate U.S. dollars.)
Third Quarter Business Summary and Subsequent Events
Third Quarter Financial Summary
Cash Inflows and Expenditures
Cash expenditures during the nine months ended September 30, 2023 totaled $8.6 million and included:
The above expenditures were offset by cash inflows of $6.2 million from the following:
Capital Resources and 12-Month Financial Outlook
At September 30, 2023, the Company had current assets of approximately $5.9 million, including cash and cash equivalents of approximately $1.6 million. On the same date, it had accounts payable and other current liabilities of approximately $5.6 million. Because the Company has ceased mining at the Rodeo mine, its only near-term opportunity to generate cash flow from mining to support continued operations is the Velardeña mine.
On November 8, 2023, the Company closed the November 2023 Offering which raised gross proceeds of $4.2 million and net proceeds of approximately $3.8 million after expenses. These funds were anticipated in the Company’s forecast. The Company’s forecast for the twelve-month period ending September 30, 2024 also projects the receipt of additional capital inflows of $3.0 to $4.5 million. In order to commence and maintain production at Velardeña, the Company expects to spend approximately $3.0 to $3.5 over the first five months of production primarily for additional underground development, which is included in the capital forecast discussed above. The actual amount of additional capital required during the twelve-month period ending September 30, 2024 may vary significantly from the amounts specified above and will depend on a number of factors, including variations in the anticipated administrative costs, costs to restart Velardeña, costs at El Quevar, and costs for continued exploration, project assessment, and advancement of its other exploration properties. Assuming that the Company is successful in restarting production and that it meets its production objectives at the Velardeña Properties, cash flow from Velardeña is expected to be positive by the end of the second quarter of 2024. The additional capital required may take the form of non-core asset sales (such as the one described below), debt financing, production-based financing (such as streaming or royalty financing), collection of outstanding VAT receivable, or otherwise. After the November 2023 Offering, the Company’s available shares authorized but not issued or outstanding is approximately 2.2 million shares. Should the Company desire to make future stock offerings of more than 2.2 million shares, the number of authorized shares will need to be increased which will require shareholder approval.
With regards to the sale of non-core assets, Golden executed a non-binding letter of intent for the sale of its Santa Maria property for a total consideration consisting of (i) initial cash proceeds of $1.5 million (plus an additional $0.24 million in VAT payment that the Company can retain) and (2) a 1.5% net smelter return royalty on the Santa Maria concession up to a cap of $1.0 million (which may be purchased by the potential buyer from Golden for $0.5 million at any time prior to the commencement of commercial production on the Santa Maria property). If that transaction is consummated, the funds would likely be received in November 2023 or later.
Golden Minerals has also held discussions with various financing parties with regard to equity and/or debt financing as well as streaming or royalty arrangements involving future production at Velardeña.
Quarterly Report on Form 10-Q
The Company’s consolidated financial statements and management’s discussion and analysis, as well as other important disclosures, may be found in the Company’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2023. This Form 10-Q is available on the Company’s website at Golden Minerals Company – SEC Filings. It has also been filed with the U.S. Securities and Exchange Commission on EDGAR at www.sec.gov/edgar and with the Canadian securities regulatory authorities on SEDAR at www.sedar.com.
About Golden Minerals
Golden Minerals is a gold and silver producer based in Golden, Colorado. The Company is primarily focused on advancing its Velardeña and Yoquivo properties in Mexico and, through partner-funded exploration, its El Quevar silver property in Argentina, as well as acquiring and advancing selected mining properties in Mexico, Nevada and Argentina.
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