Pasinex Resources Limited (CSE: PSE) (FSE: PNX) today reported net income for the second quarter of 2018 of $0.9 million compared to $0.5 million in Q2 2017. The Q2 2018 results reflect an equity gain from Horzum AS (the 50% owned joint venture that holds the Pinargozu mine) that is double that of Q2 2017 due to higher sales volumes and higher zinc prices. The drilling program at the Spur Zinc Project in Nevada (formerly named the Gunman Zinc Project) started in June at a cost of $0.3 million and is expected to be completed by the end of August.
Highlights – Q2 2018 and 2017
|(Canadian dollars)||Second Quarter|
|Pasinex financial results:|
|Equity gain from Horzum AS||$||1,805,685||$||931,355|
|Dividend received from Horzum AS||$||377,370||–|
|Consolidated net income||$||930,193||$||450,463|
|Basic net income per share||$||0.01||$||–|
|Horzum AS operational data (100% basis):|
|Zinc produced (wet) tonnes||13,080||14,381|
|Zinc sold (wet) tonnes||9,951||8,767|
|C$ cost per tonne mined||$||173||$||160|
|US$ cash cost per pound of zinc produced||$||0.20||$||0.16|
Refer to Note 1
Steve Williams, CEO of Pasinex commented, “Production at Pinargozu has been challenged by difficult ground conditions in 2018, but because we plan on producing higher grade material through the remainder of the year we expect zinc pounds produced to be consistent to our original guidance. The average LME zinc price for Q2 2018 was US$1.41 per pound which was a large contributor to the strong financial results from the mine in the quarter. We focused our exploration efforts in the quarter on the Spur Zinc Project and we are excited about the discovery of zinc sulphides at this deposit.”
Horzum AS Highlights (described on a 100% basis)
Please note that all dollar amounts in this news release are expressed in Canadian dollars unless otherwise indicated. Refer also to the interim unaudited condensed consolidated financial statements for the three and six months ended June 30, 2018 and the corresponding Management’s Discussion and Analysis (MD&A) found on SEDAR.com and Pasinex.com for more information. This news release includes non-GAAP measures, including gross margin, cost per tonne mined and US$ cash cost per pound of zinc produced. A reconciliation of these non-GAAP measures to the GAAP financial statements is included in the MD&A.
Pasinex Resources Limited is a Toronto-based mining company which owns 50% of the producing Pinargozu high grade zinc mine and, under a Direct Shipping Program, sells to zinc smelter / refiners from its mine site in Turkey. The Company also holds an option to acquire 80% of the Spur (formerly named Gunman) high-grade zinc exploration project in Nevada. Pasinex has a strong technical management team with many years of experience in mineral exploration and mining project development. The mission of Pasinex is to build a mid-tier zinc company based on its mining and exploration projects in Turkey and Nevada.
The Pinargozu mine is held in a separate entity, Horzum Maden Arama ve Isletme A.S. (Horzum AS), which is a corporate joint venture held equally between Pasinex and Turkish mining house, Akmetal Madencilik San ve Tic. AS (Akmetal AS). Akmetal AS is one of Turkey’s largest family-owned conglomerates which also owns the nearby past-producing Horzum zinc mine.
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