Vancouver, British Columbia – February 18, 2020 – Copper Mountain Mining Corporation (TSX: CMMC | ASX:C6C) (the “Company” or “Copper Mountain”) announces fourth quarter and full year 2019 financial and operating results. All currency is in Canadian dollars, unless otherwise stated. All results are reported on a 100% basis. The Company’s Financial Statements and Management Discussion & Analysis (“MD&A”) are available at www.CuMtn.com and www.sedar.com.
HIGHLIGHTS
• Production for Q4 2019 was 22.6 million pounds of copper equivalent (includes 18.6 million pounds of copper) and 87.2 million pounds of copper equivalent (includes 72.0 million pounds of copper) for 2019.
• Q4 2019 C1 cash cost was US$2.06, all-in sustaining cost (AISC) was US$2.27 and all-in cost (AIC) was US$2.31, all on a per pound of copper produced basis. 2019 C1 cash cost was US$1.92, AISC was US$2.06 and AIC was US$2.44, all on a per pound of copper produced basis.
• Q4 2019 revenue was $73.7 million and 2019 revenue was $288.5 million, net of pricing adjustments.
• Q4 2019 cash flow from operations was $4.4 million and $51.2 million for 2019.
• Cash and cash equivalents at the end of the fourth quarter were $32.1 million.
• Subsequent to year end, working capital improved by $101 million as a result of Mitsubishi Materials Corporation agreeing to extend the maturity of the annual rolling one year notes shown as a current liability to long-term debt due June 15, 2023. Mitsubishi retains the option of extending this debt at maturity to better match available cashflow of the mine at that point in time.
• In 2019, the Copper Mountain mine life was extended by 17 years to 31 years and Mineral Reserves increased by 127% to 477 million tonnes grading 0.23% Cu for 2.47 billion pounds of copper.
• Eva Copper Project Mineral Resource increased with Blackard Mineral Resource addition. Measured and Indicated Resource increased by 66% to 2.1 billion pounds of copper with the addition of 77 million tonnes grading 0.49% of copper containing 836 million pounds of copper. Inferred Resource increased 118% with the addition of 19 million tonnes grading 0.49% of copper containing 206 million pounds of copper.
“We finished the year in a solid position with strong production and grade improvements in the fourth quarter as a result of the significant development completed in 2019. We expect to see these improvements continue into 2020 and 2021 as we access high-grade zones in our main pit. Production is expected to increase 20 to 33% in 2020 compared to 2019. Our focus on containing costs was successful in 2019 with our C1 cash costs coming in at US$1.92. Further, we expect our C1 cash costs to significantly decline in 2020 by approximately 28% to between $1.30 and $1.45 per pound, with our all-in costs expected to be approximately US$2.00. We have set a good foundation in 2019 for a high growth year in 2020, where we plan on delivering higher grade, higher production and lower costs.”

Fourth Quarter 2019
In Q4 2019, revenue was $73.7 million, net of pricing adjustments and treatment charges, compared to $73.1 million in Q4 2018. Q4 2019 revenue is based on the sale of 17.6 million pounds of copper, 6,008 ounces of gold, and 76,847 ounces of silver and on an average realized copper price of US$2.67 per pound. This compares to 19.4 million pounds of copper, 7,475 ounces of gold and 69,761 ounces of silver sold in Q4 2018 and an average realized copper price of US$2.81 per pound. Revenue was slightly higher in Q4 2019 as a result of increased gold prices in Q4 2019 of US$1,481/oz as compared to US$1,229/oz in Q4 2018, and a positive mark-to-market adjustment of $6.5 million in Q4 2019 compared to a negative mark-to-market adjustment of $2.4 million in Q4 2018. A net difference of $8.9 million from the mark-to-market adjustments.
Cost of sales in Q4 2019 was $72.1 million as compared to $65.3 million for Q4 2018. The increase in cost of sales in Q4 2019 as compared to Q4 2018 is primarily the result of mining costs of $7.3 million being allocated to deferred stripping and the low-grade stockpile in Q4 2018 as compared to only $0.9 million in Q4 2019.
The Company reported a gross profit of $1.6 million and a net loss of $35.7 million for Q4 2019, compared to $7.9 million and $19.0 million, respectively, in Q4 2018. The variance in the net loss for Q4 2019, as compared to the net loss for Q4 2018, was a result of several items including:
1) A non-cash write down of $48.8 million on the carrying value of the low-grade stockpile at the end of the quarter. This adjustment is a result of the Company significantly increasing the reserves of the Copper Mountain mine during the year, which deferred the milling of the low-grade stockpile to 2038 on the increased mine life which impacted the discounted cash flow value.
2) Revenue in Q4 2019 included a positive mark-to-market adjustment on concentrate sales as compared to a negative mark-to-market adjustment for Q4 2018; and,

3) The inclusion of a non-cash unrealized foreign exchange gain of $5.4 million as compared to a non-cash unrealized foreign exchange loss of $14.7 million in Q4 2018, a differential of approximately $20 million, which was primarily related to the Company’s debt that is denominated in US dollars.
On an adjusted basis, the Company recorded net earnings of $1.3 million for Q4 2019 compared to a net loss of $1.4 million.

Full Year 2019
Full year 2019 revenue was $288 million, net of pricing adjustments and treatment charges, compared to $296 million in 2018. In 2019, the mine shipped and sold 72 million pounds of copper, 26,478 ounces of gold, and 254,541 ounces of silver on an average realized copper price of US$2.73 per pound, compared to 79 million pounds of copper, 26,799 ounces of gold and 284,086 ounces of silver in 2018 on an average realized copper price of US$2.98 per pound in 2018. Revenue was lower in 2019 as fewer pounds of copper were sold and at a lower realized price, as compared 2018.
Cost of sales for 2019 was $263 million as compared to $270 million for 2018. The decrease in cost of sales is a result of the deferral of stripping costs of $33 million for the 2019 year as compared to $20 million for 2018.
Gross profit for the year was $25.1 million as compared to $25.3 million in 2018. The Company reported a net loss of $25.9 million for the full year of 2019 as compared to a net loss of $26.9 million for year ended December 31, 2018. The loss for 2019 is attributable to a non-cash $48.8 million write-down of the low-grade stockpile, as previously mentioned. The discounting of future cash flows required to value the low-grade stockpile has resulted in the one-time non-cash write-down adjustment to the carrying value of the low-grade stockpile at the end of the year.
The loss for 2019 was offset by the inclusion of a non-cash unrealized foreign exchange gain of $14.2 million as compared to a non-cash unrealized foreign exchange loss of $23.8 million for 2018, a differential of approximately $38.0 million, which was primarily related to the Company’s debt that is denominated in US dollars. On an adjusted basis, the Company reported net earnings of $0.8 million in 2019 compared to $3.4 million in 2018.

SUMMARY OF OPERATING RESULTS

see & read more on

https://www.cumtn.com/site/assets/files/4302/02_18_2020_q4_and_fy_results_vfinal.pdf