GOLD RESOURCE CORPORATION REPORTS SECOND QUARTER RESULTS

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Overig advies 05/08/2020 06:06
COLORADO SPRINGS – August 4, 2020 – Gold Resource Corporation (NYSE American: GORO) (the “Company” or “GRC”) reported consolidated production results for the second quarter ended June 30, 2020 of 7,649 ounces of gold and 191,232 ounces of silver. In addition to precious metals, the Company produced base metals resulting in consolidated net revenue of $21.1 million for the quarter. At the beginning of the second quarter, the Company’s Oaxaca Mining Unit was placed on care and maintenance as the Mexican government declared a country-wide health emergency and mandatory non-essential business suspension due to the novel coronavirus (COVID-19) global pandemic. The Company was granted approval to restart operations on May 27, 2020 after nearly eight weeks of being shut down during the second quarter. Operations were reinstated, along with a stringent employee illness protocol and screening process, and have gradually ramped up during the months of June and July. Gold Resource Corporation is a gold and silver producer, developer and explorer with operations in Oaxaca, Mexico and Nevada, USA. The Company has returned $114 million to its shareholders in consecutive monthly dividends since July 2010 and offers its shareholders the option to convert their cash dividends into physical gold and silver and take delivery.
Q2 2020 HIGHLIGHTS
• $21.1 million net sales;
• $13.3 million cash balance at June 30, 2020, an increase from the December 31, 2019 balance of $11.1 million;
• Working capital of $33.6 million, an increase of 48% from December 31, 2019;
• Maintained a strong balance sheet during Mexico operations suspension;
• Consolidated production of 7,649 gold ounces and 191,232 silver ounces;
• Successful restart of Mexican operations following nearly two-month suspension;
• Acquisition of the Golden Mile project in Nevada, an advanced exploration property in the highly prospective Walker Lane Trend;
• Isabella Pearl gold production increase of 41% over Q1 2020;
• $4.7 million gold and silver bullion inventory; and
• $0.01 per share dividend distribution for quarter.
Overview of Q2 2020 Results
Second quarter production from the Company’s Nevada Mining Unit (NMU) totaled 5,208 ounces of gold, an increase of 41% over Q1 2020. The Isabella Pearl project continues to be in its ramp up
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phase for the remainder of 2020 targeting 40,000 gold ounces in 2021. Production from the Company’s Oaxaca Mining Unit (OMU) was negatively impacted during the quarter by a nearly eight week government mandated shutdown in Mexico due to the COVID-19 global pandemic. OMU second quarter production totaled 2,441 ounces of gold, 185,330 ounces of silver, 246 tonnes of copper, 1,140 tonnes of lead and 3,004 tonnes of zinc. The Company withdrew its 2020 annual production outlook during the quarter due to the pandemic.
During the three months ended June 30, 2020, the Company sold 5,054 gold ounces from its Isabella Pearl mine at a total cash cost of $1,402 per ounce (after by-product credits) at an average realized price of $1,708 per gold ounce*. With limited production during the second quarter, the Company sold 4,333 precious metal gold equivalent ounces at a total cash cost of $1,379 per ounce (after by-product credits) at its OMU. OMU average realized metal prices during the quarter included $1,784 per ounce gold and $16.83 per ounce silver*. The Company recorded a net loss of $1.8 million, or $0.03 per share mainly due to the mandatory shutdown of operations in Mexico resulting in lower revenues. The Company paid $0.7 million to its shareholders in dividends, or $0.01 per share during the quarter. Cash and cash equivalents at quarter end totaled $13.3 million.
*Average realized metal prices include final settlement adjustments for previously unsettled provisional sales. Some provisional sales may remain unsettled from one period into the next. Realized prices will therefore vary from average spot metal market prices upon final settlement.
COVID-19
With both the NMU and OMU projects in current operation, the Company strives to mitigate the spread of COVID-19 and protect the health and safety of our employees, contractors, and communities in which we operate. The Company has taken precautionary measures including specialized training, social distancing, a work-from-home mandate where possible, and close monitoring of national and regional COVID-19 impacts and governmental guidelines. With the ever changing and fluid nature of the pandemic impact, Company management continues to analyze and prepare for various scenarios whereby a forced or prolonged suspension of one or both mining units may be sustained.
“While it is never positive to see a mandated business suspension at any point in time, I am optimistic the shutdown was positive for Mexico in its fight to combat the COVID-19 virus,” stated Mr. Jason Reid, President and CEO of Gold Resource Corporation. “The Company was granted approval to restart operations on May 27, 2020 after nearly eight weeks of being shut down during the second quarter and have gradually ramped up operations during the months of June and July. Company management both in Mexico and Nevada have implemented strong protocols and procedures to help mitigate any potential impact from the coronavirus. These continue to be challenging times for all business across the globe, including mining, and we will continue to focus on mitigating the spread of the virus within our Company, our contractors and the communities in which we operate.”
Mr. Reid continued, “We are pleased with the 41% increase in gold production over the previous quarter at Isabella Pearl. We were also pleased to have reached the first bench levels in the Pearl zone during the quarter. As we continue through the ramp up phase and expose more Pearl benches, we expect an increase in mineralized tonnes at higher grade coupled with less waste removal for this phase one of the Pearl mine plan sequence. Eighty percent of the of the ore in the Isabella Pearl deposit is located in the Pearl zone and it is great to have reached the top as we
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mine down. Both precious metal production and total cash costs are expected to improve the second half of 2020 as higher grade ore is accessed at the Pearl deposit.”
“Subsequent to quarter-end, we announced reaching Company milestones of a decade of production, over $1 billion generated in revenue and over $114 million in dividends distributed to shareholders. We are very proud to have reached these milestones,” commented Mr. Reid.
The following Production Statistics tables summarize certain information about our Oaxaca and Nevada Mining Unit operations for the three and six months ended June 30, 2020 and 2019:
Oaxaca Mining Unit
Three months ended June 30,
Six months ended June 30,
2020 2019 2020 2019
Arista Mine
Milled
Tonnes Milled 78,741 155,847 236,776 305,908

see & read more on
https://www.goldresourcecorp.com/releases/GRC-2020-08-04-1.pdf



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