TORONTO, ONTARIO--(Marketwire - Nov. 7, 2007) - YAMANA GOLD INC. (TSX:YRI)(NYSE:AUY)(LSE:YAU) is pleased to announce its financial and operating results for the quarter ended September 30, 2007. All dollar amounts are expressed in US dollars unless otherwise specified.
Third Quarter Highlights from the period of July 1, 2007 to September 30, 2007 include the following:
Operational
- Total production of 131,366 ounces of gold for the quarter an increase of 48% over the comparative quarter ended September 30, 2006 and an increase of 13% over the quarter ended June 30, 2007. Total production of 367,816 ounces on a year to date basis.
- Average cash costs of $(339) per ounce after by-product credits and on a co-product basis of $322 per ounce of gold (excluding the Fazenda Nova Mine) and $0.71 per pound of copper on a co-product basis.
- Chapada attained record production of gold and copper at 49,716 ounces and 33 million pounds respectively with mine operating earnings of $112.7 million.
- Total concentrate production from Chapada of 54,268 tonnes for the quarter up from 50,304 tonnes in the second quarter of 2007.
- Continued development plan at Jacobina focusing on the Canavieiras Mine development with two ramps to accelerate development.
- Received positive feasibility and scoping studies for the QDD and AIM deposits of Gualcamayo and the formal approval for its Gualcamayo Environmental Assessment report. Production is expected to begin in mid-2008.
Financial
- Record quarterly sales of $199.7 million, an increase of 297% over the comparative quarter ended September 30, 2006 and an increase of 9% over the preceding quarter ended June 30, 2007.
- Mine operating earnings of $124.9 million for the quarter, an increase of 1,216% over the comparative quarter ended September 30, 2006 and 17% over the preceding quarter ended June 30, 2007.
- Adjusted earnings for the quarter of $91.9 million before income tax and $71.5 million after income tax effects representing $0.20 per share.
- Net earnings for the quarter of $30.0 million or $0.08 per share (the primary difference between accounting net earnings and adjusted net earnings is non-cash mark-to-market copper hedge losses which assumes continued high prices for copper at the time of future settlement and which would have a meaningful positive impact on revenues and earnings for non-hedged copper at that time).
- Cash flow from operations of $105.0 million before changes in non-cash working capital, representing $0.30 per share.
- Cash balance of $66.9 million as at September 30, 2007. Accounts receivable of $129.8 million as at September 30, 2007 of which $78.8 million has been received subsequent to the quarter end and $18.2 million is collectable by mid-November and will further increase available cash.
- Declared further quarterly dividend of $0.01 per share.
Exploration
- Continued exploration efforts with significant exploration successes.
- Received a scoping study for the Amelia Ines and Magdalena (AIM) deposits with work to date indicating that the deposits are higher grade, larger than initially projected, remain open for expansion and are expected to provide a larger and more significant contribution to the Gualcamayo project than was originally contemplated.
- Resources expected to increase at Jacobina as exploration and development continues.
Other
- Closed on a definitive business combination agreement with Northern Orion Resources Inc. and Meridian Gold Inc. subsequent to quarter end. Details provided in section 4 "Business Acquisitions".
- Obtained credit facility of up to $700 million subsequent to the quarter end.
- Entered into copper forward contracts at a weighted average forward price of $2.97 per pound of copper on a total of 124.9 million pounds of copper for 2008, 2009 and 2010 and $2.37 per pound of copper on a total of 35 million pounds of copper for 2011.
"During this quarter we continued to grow production in an environment of extremely robust commodity prices and delivered positive earnings and cash flow results," said Peter Marrone, chairman and chief executive officer of Yamana Gold Inc. "With the recent acquisition of Northern Orion and Meridian Gold, we now have seven producing mines, including two major expansions, five development stage projects and what is probably the best exploration portfolio in all of Central and South America. This extensive pipeline underpins our recently announced strategic plan to organically grow production to a sustainable 2.2 million ounces of gold by 2012 while continuing to provide shareholders with superior leverage to the gold price and increased growth in cash flow and earnings."
Strategic Plan and Outlook
The Company's strategic plan, previously announced on October 18, 2007, is focused on organic growth initially targeting production of 1.2 million ounces of gold in 2008 and progressively increasing to a sustainable level of 2.2 million ounces of gold starting in 2012. Production at these levels will be driven from enhancements, expansions, improvements and development of existing assets. Exploration successes from the Company's robust exploration portfolio will support and supplement these levels. Assuming positive feasibility studies for its advanced exploration stage projects, the Company expects capital investments over the next four years to be in the range of $1 to 1.3 billion.
The Company owns seven producing mines, two of which are undergoing expansion, five development stage projects and an extensive exploration portfolio in the Americas. The Company's mining approach is to target low cost of production both before and particularly after by-product credits.
Financial and Operating Summary
Net earnings for the quarter were $30.0 million compared to a loss for the comparative quarter ended September 30, 2006 of $12.1 million, representing an improvement of $42.1 million. Net earnings on a year to date basis were $110.1 million compared to a loss of $76.3 million for the nine months ended September 30, 2006, representing an improvement of $186.4 million. The increase in earnings is primarily due to commencement and ramp up of operations at the Chapada Mine since the beginning of this year.
Net earnings for the quarter and nine months ended September 30, 2007 included certain non-cash and non-recurring charges in respect of stock-based compensation, foreign exchange gains or losses, unrealized losses on derivatives, loss on impairment of the Fazenda Nova Mine, non-production costs during business interruption (sill pillar failure costs), a future income tax expense on foreign currency translation of inter corporate debt and a provision for losses on certain tax credits. The largest adjustment item is the mark-to-market on the copper derivatives which is a non-cash and non-realized loss. This assumes continued high prices for copper at the time of future settlement which would have a meaningful positive impact on revenues and earnings for the non-hedged copper at that time and is a result of the Company not being able to apply hedge accounting for its copper derivatives given that the copper is contained in concentrate.
Earnings adjusted for these non-cash and non-recurring items was $91.9 million before income tax effects and $71.5 million after income tax effects for the quarter ended September 30, 2007 compared to $4.7 million after tax for the comparative quarter representing an increase of $1,421%.
Both basic and diluted earnings per share were $0.08 for the quarter. Basic earnings per share was $0.31 and diluted earnings per share was $0.30 for the nine month period ended September 30, 2007. This compares to a basic and diluted loss per share of $0.04 and $0.30 for the comparative periods ended September 30, 2006, respectively.
Earnings per share for the quarter adjusted for certain non-cash and non-recurring items were $0.20 per share. This compares to adjusted earnings per share of $0.02 for the comparative quarter ended September 30, 2006, and $0.22 per share for the quarter ended June 30, 2007.
Revenue for the quarter was $199.7 million, an increase of 9% over the preceding quarter and an increase of 297% over the comparative quarter ended September 30, 2006. Revenue on a year to date basis was $528.5 million, an increase of 384% over the comparative nine month period ended September 30, 2006.
Revenue for the quarter included sales from 128,056 ounces of gold and 33.0 million pounds of copper. Revenue for the nine months includes sales of 370,777 ounces of gold and 88.6 million pounds of copper. Revenue for the comparative three and nine month period ended September 30, 2006 included sales from 82,602 and 180,702 ounces of gold, respectively.
The Company's average net realized gold price during the quarter was $686 per ounce, an increase of 12% from an average net realized price of $615 per ounce during the comparative quarter ended September 30, 2006. This compares to an average spot price for the quarter of $681 per ounce. On a year to date basis, the company has realized an average net gold sale price of $666 per ounce consistent with the average spot price for the period.
Mine operating earnings were $124.9 million and $308.0 million for the quarter and nine months ended September 30, 2007, respectively. Mine operating earnings for the nine months include earnings from all existing mines. Mine operating earnings for the comparative nine months were $26.2 million and included earnings from the Fazenda Brasileiro Mine, the Fazenda Nova Mine and the San Andres Mine and Jacobina Mines as of the date of acquisition and earnings for two months at Sao Francisco.
A total of 131,366 ounces were produced during the quarter up from 115,843 ounces for the quarter ended June 30, 2007. On a year to date basis, the Company produced 367,816 ounces of gold. A total of 88,781 ounces and 201,147 ounces of gold were produced by the Company's mines during the comparative quarter and nine month period ended September 30, 2006.
Additionally, production for the quarter and the nine months ended September 30, 2007 included 33.5 million pounds of copper within 54,628 tonnes of concentrate and 92.4 million pounds of copper within 149,362 tonnes of concentrate, respectively. For the quarter ended June 30, 2007 copper production amounted to 31.5 million pounds within 50,304 tonnes of concentrate.
Average cash costs for the quarter net of by-product credits were $(339) per ounce compared to $337 per ounce for the comparative quarter ended September 30, 2006. Average cash costs for the nine months ended September 30, 2007 were $(292) per ounce compared to $329 for the comparative nine months ended September 30, 2006. Cash costs for the three and nine month periods ended September 30, 2007 for the Fazenda Nova Mine are not reflective of ongoing operations as Fazenda Nova operations have been discontinued. Average cash costs for the quarter excluding Fazenda Nova were $(342) per ounce. On a co-product basis cash costs for the quarter were $0.71 per pound of copper and $322 per ounce of gold (excluding Fazenda Nova).
The Company recorded a non-recurring loss from non-production costs during business interruption of $13.2 million year-to-date as a result of sill pillar failures at its Jacobina Mine during the first quarter. The Company has filed an insurance claim with respect to these business interruption losses. Any insurance recovery will be credited to net earnings in the period that the claim is settled with the insurance company.
Inventory as at September 30, 2007 was $68.7 million and is comparable to that of the preceding quarter ended June 30, 2007 of $62.3 million. This compares to $51.3 million as at December 31, 2006.
Cash as at September 30, 2007 was $66.9 million compared to $89.0 million as at June 30, 2007 and $69.7 million as at December 31, 2006. The decrease in cash is due to capital investments in property, plant and equipment, mining interests and our construction projects. As at September 30 2007, the Company had accounts receivables in the amount of $129.8 million, compared to $72.1 million as at June 30, 2007 and $6.0 million as at December 31, 2006. The increase in accounts receivable is due to concentrate receivables as at the quarter end from Chapada Mine sales and is ordinary course as it is dependent on the timing of shipments and as production increases at the Chapada Mine and concentrate sales increase accordingly.
Working capital as at September 30, 2007 was $159.4 million compared $76.3 million as at December 31, 2006 and $120.6 million as at June 30, 2007. The increase in working capital is primarily related to the start up of operations at the Chapada Mine and the increase of sales accordingly.
Cash flow from operations before changes in non-cash working capital items was $105.0 million for the quarter compared to $14.6 million for the comparative quarter ended September 30, 2006 and $90.9 million for the second quarter of 2007. Cash flow from operations before changes in non-cash working capital items was $264.8 million for the nine month period ended September 30, 2007 compared to $37.5 million for the comparative nine month period ended September 30, 2006. The increase in cash flow from operations for the three and nine months is primarily due to start-up of operations at the Chapada Mine.
General and administrative expenses were $11.9 million and $30.8 million for the three and nine month periods, respectively. This compares to $5.1 million and $13.7 million for the comparative three and nine month periods ended September 30, 2006 and $10.7 million for the second quarter of 2007. The increase in general and administrative expenses reflects the Company's growth from operations and acquisitions and the growing infrastructure to support its production growth.
The Company recorded unrealized derivative losses of $50.8 million and $79.5 million for the three and nine months ended September 30, 2007, respectively. These unrealized losses consist principally of mark-to-market gains and losses on copper commodity contracts. The spot copper price has declined subsequent to the quarter, from $3.70 per pound as at September 30, 2007 to $3.42 as at November 2, 2007. A change of this magnitude would totally reverse the third quarter unrealized loss.
Conference Call A conference call and audio webcast has been scheduled for November 8, 2007 at 11:00 a.m. EST to discuss the third quarter results. Conference Call Information: ---------------------------- Toll Free (North America): 866-542-4236 International: 416-641-6125 Participant Audio Webcast: www.yamana.com Conference Call REPLAY: ----------------------- Replay Call: 416-695-5800 Passcode 3239999 # Replay Toll Free Call: 800-408-3053 Passcode 3239999 #
The conference call replay will be available from 1:20 p.m. EST on November 8, 2007 until 11:59 p.m. EST on November 15, 2007.
About Yamana
Yamana is a Canadian gold producer with significant gold production, gold development stage properties, exploration properties and land positions in Brazil, Argentina and Central America. With the purchase of Meridian Gold, the Company now also owns mines and properties in Chile, Mexico and the United States. Yamana is producing gold at intermediate company production levels in addition to significant copper production. Yamana's management plans to continue to build on this base through the advancement of its exploration properties and by targeting other gold consolidation opportunities in the Americas.
Yamana Gold Inc.
Summarized Quarterly Data
(thousands of United States dollars, except where noted, unaudited)
---------------------------------------------------------------------------
For the Three Months ended For the Nine Months ended
September 30, September 30, September 30, September 30,
2007 2006 2007 2006
---------------------------------------------------------------------------
Financial
Operating cash
flow before
changes in working
capital $104,978 $14,603 $264,817 $37,516
Operating cash
flow per share $0.30 $0.05 $0.75 $0.15
Adjusted earnings $471,461 $4,690 $195,169 $19,002
Adjusted earnings
per share $0.20 $0.02 $0.55 $0.07
Weighted average
number of
Common shares
(in thousands) $355,378 $293,272 $354,208 $256,201
Outstanding basic
(in thousands) 355,737 293,685 355,737 293,685
Net Earnings (loss) 29,950 (12,085) 110,136 (76,304)
Basic earnings per
share basic $0.08 ($0.04) $0.31 ($0.30)
Production Statistics
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Three months ended Nine months ended
September September September September
30, 2007 30, 2006 30, 2007 30, 2006
Cash Cash Cash Cash
costs costs costs costs
per per per per
oz. oz. oz. oz.
Pro- (a non- Pro- (a non- Pro- (a non- Pro- (a non-
duc- GAAP duc- GAAP duc- GAAP duc- GAAP
tion mea- tion mea- tion mea- tion mea-
(oz.) sure) (oz.) sure) (oz.) sure) (oz.) sure)
---------------------------------------------------------------------------
Gold
Produc-
tion
Brazil
Chapada 49,716 $ (1,560) - $ - 132,697 $ (1,494) - $ -
Sao
Fran-
cisco 27,271 $ 390 20,789 $ 314 83,520 $ 352 20,789 $ 314
Jacobina 17,289 $ 544 19,321 $ 317 35,812 $ 499 41,654 $ 325
Fazenda $ 18,569 $ 356 65,462 $ 363 55,970 $ 347
Brasil-
eiro 24,086 351
Fazenda
Nova 498 $ 368 6,548 $ 306 6,926 $ 551 21,990 $ 290
---------------------------------------------------------------------------
Total
Brazil 118,860 $ (411) 65,227 $ 326 324,417 $ (381) 140,403 $ 327
---------------------------------------------------------------------------
Central
Amer-
ica
San
An-
dres 12,506 $ 346 14,685 $ 386 43,399 $ (381) 38,494 $ 339
---------------------------------------------------------------------------
Com-
mer-
cial
Pro-
duc-
tion 131,366 $ (339) 79,912 $ 337 367,816 $ (292) 178,897 $ 329
---------------------------------------------------------------------------
Pre-com-
mer-
cial
Pro-
duc-
tion
Sao
Fran-
cisco - $ - 8,869 $ - - $ - 22,250 $ -
---------------------------------------------------------------------------
Pre-acqui-
sition
Pro-
duc-
tion
Jaco-
bina - - - - - - 18,974 -
San
Andres - - - - - - 13,987 -
Post
acqui-
sition
produc-
tion
from
opera-
tions -
La
Liber-
tad - - - - - - 12,721 -
---------------------------------------------------------------------------
TOTAL
GOLD
PRO-
DUC-
TION 131,366 $ - 88,781 $ - 367,816 $ - 246,829 $ -
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Concentrate
(tonnes)
Chapada 54,628 149,362
Copper
contained
in Con-
cen-
trate
(mill-
ions
lbs)
Chapada 5.5 - - - 92.4 - - -
Con-
cen-
trate
(ton-
nes)
Chap-
ada 54,628 - - - 149,362 - - -
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(i) Chapada cash costs on a co-product basis for the periods ended
September 30, 2007
Three Months Nine Months
Gold $188 $194
Copper $0.71 $0.70
Operating Statistics
For the three months ended For the nine months ended
September September September September
30, 30, 30, 30,
2007 2006 2007 2006
CHAPADA
---------------------------------------------------------------------------
Production
Ore mined (tonnes) 4,174,786 - 12,900,704 -
Ore milled (tonnes) 3,256,283 - 9,956,108 -
Ore grade Gold 0.64g/t - 0.59g/t -
Ore grade Copper 0.52% - 0.50% -
Concentrate (tonnes) 54,628 - 149,362 -
Gold contained in
concentrate (ounces) 49,716 - 132,697 -
Copper contained
in concentrate 33.5 million - 92.4 million -
(pounds)
Concentrate grade
- gold 28.3g/t - 27.6g/t -
Concentrate grade
- copper 27.8% - 28.1% -
Gold contained in
concentrate recovery
rate 73.7% - 73.1% -
Copper contained in
concentrate
recovery rate 89.0% - 87.2% -
Sales
Concentrate (tonnes) 55,773 - 152,571 -
Payable gold
contained in
concentrate
(ounces) 48,133 - 129,283 -
Payable copper
contained in
concentrate 33.0 million - 88.6 million -
Cash costs per
ounce produced $ (1,560) - $ (1,494) -
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SAO FRANCISCO MINE
---------------------------------------------------------------------------
Gold production -
pre-commercial
(ounces) - 8,869 - 22,250
Gold production -
commercial (ounces) 27,271 20,789 83,520 20,789
---------------------------------------------------------------------------
Total gold production
(ounces) 27,271 29,658 83,520 43,039
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Gold sales (ounces) 23,114 21,828 83,616 21,828
Cash costs per ounce
produced $ 390 $ 314 $ 352 $ 314
Ore Grade 0.61g/t 0.58g/t 0.55g/t 0.58g/t
Full recovery rate (ii) - - 77% -
Ore Recovery rate (i) 61.0% (i) 69.1% (i)
Ore mined (tonnes) 2,072,564 1,892,474 5,807,938 3,665,089
(i) Recovery cycle not complete
(ii) Full recovery rate represents the recovery rate over the leaching
cycle
(iii) Sao Francisco commenced commercial production August 1, 2006
---------------------------------------------------------------------------
JACOBINA
---------------------------------------------------------------------------
Gold production (ounces) 17,289 19,321 35,812 41,654
Gold sales (ounces) 15,335 20,221 34,462 44,235
Cash costs per ounce
produced $ 544 $ 317 $ 499 $ 325
Ore Grade 1.79g/t 1.72g/t 1.71g/t 1.88g/t
Ore Recovery rate 94.7% 93.6% 94.8% 93.6%
Ore mined (tonnes) 321,058 333,649 689,142 638,291
Ore milled (tonnes) 317,430 372,790 685,514 737,728
(i) At September 30, 2006 production statistics from the date of
acquisition of April 15, 2006
---------------------------------------------------------------------------
SAN ANDRES
---------------------------------------------------------------------------
Gold production (ounces) 12,506 14,685 43,399 38,494
Gold sales (ounces) 12,798 14,578 45,973 38,224
Cash costs per ounce
produced $ 346 $ 386 $ 365 $ 339
Ore Grade 0.69g/t 0.63g/t 0.59g/t 0.70g/t
Ore Recovery rate 152.1% 89.3% 104.1% 88.5%
Ore mined (tonnes) 347,875 900,727 2,180,581 2,630,583
---------------------------------------------------------------------------
FAZENDA BRASILEIRO MINE
---------------------------------------------------------------------------
Gold production (ounces) 24,086 18,569 65,462 55,970
Gold sales (ounces) 26,940 19,835 68,731 54,747
Cash costs per ounce
produced $ 351 $ 356 $ 363 $ 347
Ore Grade 3.01g/t 2.54g/t 2.80g/t 2.57g/t
Ore Recovery rate 95.1% 93.0% 94.3% 91.5%
Ore mined (tonnes) 259,780 247,518 779,868 737,285
Ore milled (tonnes) 261,960 244,038 769,979 740,788
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FAZENDA NOVA MINE
---------------------------------------------------------------------------
Gold production (ounces) 498 6,548 6,926 21,990
Gold sales (ounces) 1,736 6,140 8,712 21,668
Cash costs per ounce
produced $ 368 $ 306 $ 551 $ 290
Ore Grade (i) 0.63g/t 0.48g/t 0.67g/t
Ore Recovery rate (i) 70.0% 98.3% 72.4%
Ore mined (tonnes) (i) 477,211 424,396 1,399,451
(i) Fazenda Nova ceased mining in May 2007
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YAMANA GOLD INC.
Consolidated Balance Sheets
As at
(In thousands of US Dollars; unaudited)
September 30, December 31,
2007 2006
---------------------------------------------------------------------------
Assets
Current
Cash and cash equivalents $ 66,944 $ 69,680
Accounts receivable 129,780 6,036
Advances and deposits 39,729 24,244
Inventory 68,659 51,252
Income taxes recoverable 14,013 2,248
Current portion of derivative related assets 9,110 -
---------------------------------------------------------------------------
328,235 153,460
Capital
Property, plant and equipment 380,629 134,792
Assets under construction 16,698 224,650
Mineral properties 1,578,971 1,496,732
---------------------------------------------------------------------------
1,976,298 1,856,174
Other
Available-for-sale securities 23,354 28,009
Share purchase warrants held 254 313
Derivative related assets 8,434 -
Other assets 51,239 34,452
Future income tax assets 74,181 53,784
Goodwill 55,000 55,000
---------------------------------------------------------------------------
212,462 171,558
$ 2,516,995 $ 2,181,192
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Liabilities
Current
Accounts payable $ 55,953 $ 39,467
Accrued liabilities 21,689 10,722
Income taxes payable 28,685 3,922
Current portion of derivative related
liabilities 62,143 21,163
Current portion of long term liabilities 341 1,927
---------------------------------------------------------------------------
168,811 77,201
Long term
Asset retirement obligation 26,373 18,720
Derivative related liabilities 59,882 23,260
Future income tax liabilities 384,009 328,372
Long term liabilities 19,321 17,049
---------------------------------------------------------------------------
489,585 387,401
---------------------------------------------------------------------------
658,396 464,602
---------------------------------------------------------------------------
Shareholders' Equity
Capital Stock
Issued and outstanding 355,737,057
common shares
(December 31, 2006 - 344,595,212 shares) 1,720,997 1,619,850
Shares to be issued - 42,492
Share purchase warrants 72,902 73,004
Contributed surplus 40,266 61,578
Accumulated other comprehensive income 5,014 -
Retained earnings (deficit) 19,420 (80,334)
---------------------------------------------------------------------------
1,858,599 1,716,590
---------------------------------------------------------------------------
$ 2,516,995 $ 2,181,192
---------------------------------------------------------------------------
---------------------------------------------------------------------------
YAMANA GOLD INC.
Consolidated Statements of Operations
For the Periods Ended
(In thousands of US Dollars except for share and per share amounts;
unaudited)
For the three months ended For the nine months ended
September September September September
30, 2007 30, 2006 30, 2007 30, 2006
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Revenues $ 199,693 $ 50,299 $ 528,493 $ 109,256
Cost of sales (58,800) (31,752) (179,755) (63,811)
Depreciation,
amortization
and depletion (15,435) (8,888) (39,539) (18,802)
Accretion of asset
retirement
obligations (522) (167) (1,229) (490)
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Mine operating
earnings 124,936 9,492 307,970 26,153
Expenses
General and
administrative (11,924) (5,057) (30,833) (13,740)
Foreign exchange
(loss) gain (331) 540 (7,026) 6,133
Stock-based
compensation (137) (761) (698) (38,301)
Other losses (5,305) - (17,997) -
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Operating earnings
(loss) 107,239 4,214 251,416 (19,755)
Investment and other
business income 1,003 1,200 6,019 4,251
Interest and
financing expense (3,929) (1,650) (9,548) (27,376)
Realized loss on
derivatives (9,061) - (9,061) -
Unrealized loss on
derivatives (50,786) (16,716) (79,485) (37,002)
Loss on assets held
for sale - - - (2,186)
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Earnings (loss) before
income taxes 44,466 (12,952) 159,341 (82,068)
Income tax (expense)
recovery (14,516) 867 (49,205) 5,764
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Net earnings (loss) $ 29,950 $ (12,085) $ 110,136 $ (76,304)
Basic earnings
(loss) per share $ 0.08 $ (0.04) $ 0.31 $ (0.30)
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Diluted earnings
(loss) per share $ 0.08 $ (0.04) $ 0.30 $ (0.30)
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Basic weighted
average number of
shares outstanding
(in thousands) 355,378 293,272 354,208 256,201
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Diluted weighted
average number of
shares outstanding
(in thousands) 365,519 293,272 366,554 256,201
---------------------------------------------------------------------------
---------------------------------------------------------------------------
YAMANA GOLD INC.
Consolidated Statements of Cash Flows
For the Periods Ended
(In thousands of US Dollars; unaudited)
For the three months ended For the nine months ended
September September September September
30, 2007 30, 2006 30, 2007 30, 2006
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Operating
Activities
Net earnings for
the period $ 29,950 $ (12,085) $ 110,136 $ (76,303)
Asset retirement
obligations
realized (281) (41) (1,141) (259)
Non-operating
financing fee - - - 5,000
Items not involving
cash
Depreciation,
amortization
and depletion 15,435 8,888 39,539 19,729
Stock-based
compensation 137 761 698 38,300
Future income taxes 2,261 (451) 12,937 (8,107)
Accretion of
asset retirement
obligations 522 167 1,229 504
Unrealized foreign
exchange 4,960 - 14,119 -
Unrealized loss
on derivatives 50,786 16,716 79,485 37,002
Impairment of the
Fazenda Nova Mine
and other asset
write-offs - - 1,821 -
(Recovery) provision
for losses
on inventory (467) 1,553 3,871 1,543
Financing charge - - - 19,744
Other 1,675 (905) 2,123 363
---------------------------------------------------------------------------
---------------------------------------------------------------------------
104,978 14,603 264,817 37,516
Net change in
non-cash
working capital (49,624) (36,922) (116,745) (44,631)
---------------------------------------------------------------------------
---------------------------------------------------------------------------
55,354 (22,319) 148,072 (7,115)
Financing Activities
Issue of common
shares, options and
warrants for cash
(net of issue costs) 2,348 2,384 25,567 213,835
Dividends paid (3,301) - (10,519) -
Settlement of
derivatives (4,177) - (8,639) -
Deferred financing
charges 486 - (48) (224)
Repayment of notes
payable and long
term liabilities (806) (1,016) (2,090) (119,151)
(5,450) 1,368 4,271 94,460
Investing Activities
Expenditures on
mineral properties (26,819) (16,992) (67,737) (36,365)
Acquisition of
property, plant
and equipment (21,818) (6,905) (53,152) (14,855)
Expenditures on
assets under
construction (13,896) (17,567) (16,461) (111,201)
Deferred business
development expenses (6,294) - (6,294) -
Proceeds on
disposition
of assets 737 - 737 -
Cash acquired on
business
combinations
(net of costs) - 423 (848) 13,037
Other assets (3,282) (9,622) (14,333) (18,861)
(71,372) (50,663) (158,088) (168,245)
Effect of foreign
exchange on non-US
dollar denominated
cash and cash
equivalents (544) - 3,009 -
Decrease in cash
and cash equivalents (21,468) (71,614) (5,745) (80,900)
Cash and cash
equivalents,
beginning of period 88,956 142,347 69,680 151,633
Cash and cash
equivalents,
end of period $ 66,944 $ 70,733 $ 66,944 $ 70,733
Cash and cash
equivalents are
comprised of
the following:
Cash at bank $ 49,639 $ 33,700 $ 49,639 $ 33,700
Bank term deposits 17,305 37,033 17,305 37,033
$ 66,944 $ 70,733 $ 66,944 $ 70,733
FORWARD-LOOKING STATEMENTS: This news release contains certain "forward-looking statements" within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended and "forward-looking information" under applicable Canadian securities laws. Except for statements of historical fact relating to the company, certain information contained herein constitutes forward-looking statements. Forward-looking statements are frequently characterized by words such as "plan," "expect," "project," "intend," "believe," "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. These factors include possible variations in ore grade or recovery rates, fluctuating metal prices, prices for sulphiric acid and currency exchange rates, changes in project parameters, the possibility of project cost overruns or unanticipated costs and expenses and general risks of the mining industry, failure of plant, equipment or processes to operate as anticipated, unexpected changes in mine life of Chapada, availability of a local market for the sale of sulphiric acid, as well as those risk factors discussed or referred to in the Company's annual Management's Discussion and Analysis and Annual Information Form filed with the securities regulatory authorities in all provinces of Canada and available at www.sedar.com, and the Company's Annual Report on Form 40-F filed with the United States Securities and Exchange Commission. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. The Company undertakes no obligation to update forward-looking statements if circumstances or management's estimates or opinions should change. The reader is cautioned not to place undue reliance on forward-looking statements.
CAUTIONARY NOTE TO U.S. INVESTORS CONCERNING ESTIMATES OF MEASURED, INDICATED AND INFERRED RESOURCES
This news release uses the terms "Measured", "Indicated" and "Inferred" Resources. United States investors are advised that while such terms are recognized and required by Canadian regulations, the United States Securities and Exchange Commission does not recognize them. "Inferred Mineral Resources" have a great amount of uncertainty as to their existence, and as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or other economic studies. United States investors are cautioned not to assume that all or any part of Measured or Indicated Mineral Resources will ever be converted into Mineral Reserves. United States investors are also cautioned not to assume that all or any part of an Inferred Mineral Resource exists, or is economically or legally mineable.
CAUTIONARY LANGUAGE REGARDING RESERVES AND RESOURCES
Readers are advised that National Instrument 43-101 of the Canadian Securities Administrators requires that each category of mineral reserves and mineral resources be reported separately. Mineral resources are not mineral reserves and have not demonstrated economic viability. Other than as disclosed, the effective date, details of key assumptions, parameters and methods used in the foregoing estimates and other information is disclosed in the Annual Information Form of Yamana for the year ended December 31, 2006 available under Yamana's profile at www.sedar.com, for this detailed information, which is subject to the qualifications and notes set forth therein.
FOR FURTHER INFORMATION PLEASE CONTACT:
Yamana Gold Inc.
Jodi Peake
Vice President, Public & Investor Relations
(416) 815-0220
Email: investor@yamana.com
Website: www.yamana.com
