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Revett Minerals Reports on 2005 Full Year Results
April 7, 2006April 7, 2006; Revett Minerals Inc (“Revett” or the “Company”, Spokane Valley, Washington (“TSX-RVM”) is pleased to report the operating and financial results for the fourth quarter and the year ending December 31, 2005. All currency in this release is in United States dollars unless otherwise indicated.
Overall Performance
In summarizing the performance of the Company during its first year of operations, Mr. William Orchow, President and CEO of Revett Minerals, stated “We are pleased with the successful first year of our history and achieved a number of notable accomplishments including:
- a successful IPO raising (Cdn) $34.5 million;
- the resumption of mining operations at Troy with revenue in excess of $21 million;
- an increase in the Troy Mine (“Troy”) reserves of approximately 40%; and
- Troy received the National Mining Association Sentinels of Safety Award.”
Consolidated Results
For the year ended December 31, 2005, the Company recorded revenues of $21.1 million. The direct operating costs to produce that revenue was $19.3 million and depreciation and depletion expense was $1.4 million implying a profit from mining operations (a non-GAAP measure) of $0.4 million. Other expenses included the non-cash accrual for reclamation and remediation liability of $0.6 million, general and administrative costs of $2.6 million, exploration and development expenditures at Troy and Rock Creek of $1.3 million and interest expense of $1.7 million, which was offset by interest and other income of $0.6 million. This resulted in a loss before income taxes and non-controlling interest of $5.2 million and for the year a loss after non-controlling interest of $2.3 million or $0.05 per share. Metal sales for the first twelve months of 2005 were 7.8 million pounds of copper and 953,982 ounces of silver. During the twelve month period ending December 31, 2005, the Company used a net of approximately $1.6 million in cash for its operating activities. Overall, the Company experienced difficulty in ramping up production to the levels originally forecast, although steady improvements are now being made. This issue is discussed in more detail further in this release.
Revenues for the fourth quarter of 2005 were $6.5 million. During the fourth quarter, the mine shipped and received provisional payment for 1.9 million pounds of copper and 244,627 ounces of silver. The direct costs of production for the fourth quarter were $5.6 million and depreciation and depletion expense was $0.6 million implying a profit from mining operations of $0.30 million, representing 71% of the total profit from mining operations for the year. Other expenses during the fourth quarter included exploration and development costs of $0.5 million, general and administrative costs of $1.0 million, interest expense of $0.9 million, which was offset by interest and other income of $0.2 million, and the reclamation and remediation liability of $0.2 million. The loss for the fourth quarter before income taxes and non-controlling interest was $2.1 million and the loss for the quarter after non-controlling interest was $0.01 million or $0.00 per share.
The following is a summary of the production, sales and shipment results from the Troy Mine (100% basis) for the fourth quarter and the twelve month period ending December 31, 2005.
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Fourth Quarter 2005
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2005 Fiscal Year
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Tons milled
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222,888
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782,972
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Tons milled per day
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2,423
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2,145
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Copper grade (pct)
|
0.58
|
0.69
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|
Silver grade (opt)
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1.42
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1.65
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Copper recovery (pct)
|
81.7
|
81.1
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|
Silver recovery (pct)
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85.2
|
84.6
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Copper produced (pounds)
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2,103,121
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8,772,802
|
|
Silver produced (ounces)
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270,614
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1,094,725
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Copper sold (pounds)
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1,932,801
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7,771,100
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|
Silver sold (ounces)
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244,627
|
953,982
|
During the quarter ending December 31, 2005, the mill processed ore at the rate of approximately 2,423 tons per day. This compares with an average of 1,852 tons milled per day during the third quarter. For the year mill throughput was at an average of 2,145 tons per day. While improvements are being made in increasing mill throughput, the Company is still operating at levels below it early 2005 forecast. This is due to poor availability of the jumbo drills and operator inexperience operating the jumbo drills. Both grades and recoveries as noted above are essentially in line with expectations.
The Company has completed the initial phase of the 2005 diamond drill exploration program. This phase included three surface holes totaling 4,505 feet and two underground holes totaling 447 feet. No results are available for the underground holes as of the date of this release. Partial results from the three surface holes together with assays from the underground mine development program indicate an increase in the resource for the East Ore Body middle quartzite. The mineralized zone has been extended 250 feet to the east by mine development and its continuity has been confirmed between the northern and southern blocks of the East Ore Body by surface drilling. As at December 31, 2005, the total proven and probable reserves at the Troy Mine were estimated at 12.06 million tons grading 1.41 ounces per ton silver and 0.60% copper compared to proven and probable reserves as at December 31, 2004 of 8.66 million tons grading 1.57 ounces per ton silver and 0.65% copper. The reserves in 2005 were calculated by using a cut-off grade of $12.00 net smelter return per ton. These reserves were calculated by Mr. Larry Erickson, P. Eng, a Qualified Person in accordance with National Instrument 43-101
Rock Creek
At Rock Creek, the Company continues its efforts to advance the project. The work initiated since March 2005 includes the commissioning of numerous engineering project scoping studies, some base line water quality and hydrology studies, and an application to the Montana Department of Environmental Quality to commence with the Rock Creek evaluation adit. Revett completed the acquisition of the mitigation lands required during the evaluation stage of the Rock Creek Project. The acquisition of these lands will assist the USFWS in strengthening its Biological Opinion. In addition to the above, the Company has initiated an extensive public relations campaign to educate the local stakeholders and state regulators about the significant benefits which would accrue to Montana and Idaho with the development of the Rock Creek Project.
About Revett
Revett Minerals, through its subsidiaries, owns both the Rock Creek Project and the Troy Mine located in northwest Montana. Based on the drilling to date, Rock Creek contains an estimated inferred resource of 136.6 million tons grading 1.67 ounces silver per ton and 0.72% copper, containing approximately 229 million ounces of silver and over 2 billion pounds of copper using a cut off grade of US $10.00 per ton. Further information on both the Troy Mine and the Rock Creek Project may be found in the National Instrument 43-101 reports at www.sedar.com. These reports were prepared on behalf of the Company by Jean-Francois Couture, P.Geo. and Ken Reipas, P.Eng. of SRK Consulting (Canada). Both Mr. Couture and Reipas are Qualified Persons in accordance with National Instrument 43-101. All of these issues are discussed in greater detail in the Company’s official filings at
www.sedar.com.
William Orchow
President & CEO
For more information, please contact:
Scott Brunsdon, CFO or Doug Ward, VP Corporate Development at (509) 921-2294 or visit our website at www.revettminerals.com.
Forward Looking Statements
Except for the statements of historical fact contained herein, the information presented in this MD&A may contain “forward–looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements, including but not limited to those with respect to the price of silver and copper, the estimation of mineral reserves and resources, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production, involve known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, risks relating to environmental laws and regulations, the actual results of exploration activities, actual results of current reclamation activities, conclusions of economic evaluations, changes in project parameters as plans continue to be refined, future metal prices, as well as those factors discussed in the section entitled “Risk Factors” in the annual information form filed on sedar at www.sedar.com Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements.
© Copyright 2010, Revett Minerals, Inc.
