Revett Minerals Inc. (NYSE MKT:RVM / TSX:RVM) is pleased to announce its consolidated operating and financial results for the third quarter and first nine months of 2012. The financial results are based on US GAAP unless otherwise indicated and all currencies are in United States dollars unless otherwise indicated.
Highlights for the third quarter and first nine months of 2012 include:
- For the third quarter ended September 30, 2012 the Company recorded net income of $4.4 million or $0.13 per share (basic). Net income for the first nine months of 2012 was $5.9 million or $0.17 per share (basic).
- Net cash from operations(1) for the third quarter ended September 30, 2012 was $7.5 million. Net cash from operations(1) for the first nine months of 2012 was $18.5 million.
- Cash and short term investments on hand increased to $32.6 million, a 29% year to date increase over cash on hand of $25.2 million as of December 31, 2011.
- The Company’s working capital increased to $33.1 million, a 19% year to date increase over working capital of $27.8 million as of December 31, 2011.
- Adjusted EBITDA(2) for the third quarter ended September 30, 2012 was $5.5 million. Adjusted EBITDA(2) for the first nine months of 2012 was $11.2 million.
- Silver production for the first nine months of 2012 was 950,956 ounces, 4% below the first nine months of 2011. Third quarter silver production totaled 348,194 ounces averaging throughput grades of 1.18 oz/ton. Copper production for the first nine months of 2012 was 6,547,233 pounds, a 21% decrease compared to first nine months of 2011. Copper production for the third quarter was 2,361,915 pounds averaging throughput grades of 0.42%.
Consolidated Financial Results
Total revenue for the third quarter ended September 30, 2012 was $19.4 million compared to $16.7 million in the third quarter of 2011. For the first nine months of 2012 revenue was $52.0 million compared to $48.2 million for the first nine months of 2011. Higher revenues for the third quarter of 2012 was due primarily to higher silver and copper sales resulting in lower concentrate inventories on hand at quarter end.
Cost of sales increased 20% overall in the first nine months of 2012 compared to 2011. This increase is a result of higher overall metal sales combined with higher labor costs, higher freight, treatment and refining charges, along with higher consumable and bio-diesel fuel costs.
Our exploration and development costs also increased by $2.1 million in the first nine months of 2012 compared to 2011 due to increased emphasis on exploration in and around the Troy Mine and costs related to the ongoing Supplemental EIS and other permitting activities for Rock Creek.
Troy Operating Summary
Mill throughput for the first nine months of 2012 averaged 3,680 tpd, compared to the first nine months of 2011 of 3,873. Third quarter 2012 throughput was 340,893 tons processed, averaging 3,788 tpd for the period.
Troy Mine Permitting Update
On September 20, 2012, the U.S. Forest Service (the “Forest Service”) and the Montana Department of Environmental Quality (“DEQ”) issued a joint Record of Decision approving a revised reclamation plan for the Troy Mine. Although the Record of Decision is very similar to the current reclamation plan for the mine, it contains some additional closure requirements such as converting a portion of existing paved roads to gravel and, adding additional organic soil and mulch amendments to reclaim the tailings impoundment area. Most significantly, the new Record of Decision makes clear that an active water treatment facility to perpetually treat water from the Troy Mine following closure is not required. The Montana DEQ has not yet provided an estimate of the bonding requirements for the revised reclamation plan. We expect to have those estimates by year end.
On October 15, 2012, the Cabinet Resource Group, a regional environmental advocacy group, voluntarily dismissed, with prejudice, its pending lawsuit against DEQ, the Company, and Troy Mine, Inc. in Montana state court. The lawsuit, which was filed in 2007, had specified various issues related to the former reclamation plan.
Rock Creek Project Permitting Update
The Company is required to obtain a number of state and federal permits prior to commencing Phase 1 development at Rock Creek. Among these are a State MPDES permit for storm water discharges and issuance of a Supplemental Environmental Impact Statement (EIS) for the project.
In July 2011, the Montana State District Court ruled that the Company was required to obtain an “individual MPDES discharge permit” rather than the issued “general discharge permit” for road upgrades and storm water management during Phase 1 of the project. The Company subsequently appealed this decision to the Montana Supreme Court. On October 29, 2012, the Montana Supreme Court upheld the lower state court decision in a 4–2 ruling. The Company does not consider the decision a setback and has been working for several months with the DEQ on an application for an individual MPDES permit which is expected to be issued and effective by mid 2013.
In addition, the U.S. Forest Service, as lead agency, continues to work toward completion of a Supplemental EIS that addresses the matters raised in the Federal district court’s May 2010 ruling. When issued, the Supplemental EIS, together with the Biological Opinion that was upheld by the Ninth Circuit Court of Appeals in November 2011, will form the basis of a re-issued Record of Decision. We expect that a draft of the Supplemental EIS will be delivered to the Forest Service by the agency’s contractor during the first quarter of 2013.
The Company is pleased to report that as of the date of this release there is no current or pending environmental litigation against the Company at either the Troy Mine or Rock Creek properties.
John Shanahan, President and CEO stated, “We remain focused on seeing Rock Creek through to development and production. Just as we do at our Troy Mine, we believe that we can develop Rock Creek to the highest level of environmental compliance and this project will be a source of pride for the communities of northwest Montana. We remain extremely grateful to both the state and federal agencies that guide us, along with the communities and local businesses that strongly support the development of the Rock Creek project"
Quarterly Financial Results Conference Call
Revett has scheduled a conference call to discuss its third quarter 2012 financial results on Friday, November 9, 2012, at 11:30 am (EST).
To participate in the call, North American callers can call 1-888-231-8191 and International callers can call (647) 427-7450. Please dial in to the call approximately five to ten minutes prior to the scheduled start time of the call.
The conference call and all questions and answers will be recorded and made available until November 16, 2012. To listen to the recording, call toll free (855) 859-2056 or (416) 849-0833 and enter the access code 42815190#