Great Panther Mining Limited (TSE:GPR) (NYSEAMERICAN:GPL) saw a substantial growth in revenue during its first quarter of 2020 thanks to production from its newest Tucano gold mine in Brazil.
For its first quarter ended March 31, 2020, the Vancouver-based miner generated US$48.1 million in revenue, a 188% increase over the same quarter a year earlier .
Tucano clocked US$38 million in revenue in the first quarter driven by higher sales volume from Great Panther’s Mexican operations and higher realized gold and silver prices, according to the company.
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Great Panther added Tucano to its portfolio in March 2019 as part of its US$105 million acquistion of Beadell Resources. In addition to Tucano, Great Panther operates the Topia mine and the Guanajuanto Mine Complex in Mexico.
Mine operating earnings and operating cash flow also grew as a result of the Tucano acquisition, coming in at US$14.2 million or US$0.05 per share and US$11.8 million or US$0.04 per share respectively.
“We delivered significant growth in revenue, mine operating earnings and operating cash flow in the first quarter of 2020 as a result of the acquisition of Tucano last year,” CEO Rob Henderson said in a statement Friday.
“The team achieved a significant advance in stripping at Tucano completing a 36% increase in waste movement over the prior quarter which is strongly supportive of our guidance for 2020 and positions us well for 2021.”
The miner recently launched a US$6.6 million, 55,000 metre exploration drill program at Tucano focused on the addition of new near-mine mineralized zones and extension of the mine life.
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The company ended the quarter with US$38.8 million cash and equivalents. Net loss for the quarter was US$40.5 million or $0.13 per share, which included US$26 million in mark-to-market adjustments on the company’s derivative instruments and a foreign exchange loss of $10.8 million reflecting a weakening of the Brazilian real against the US dollar.
All in sustaining costs at Tucano increased to US$1,752 due to the high volume of stripping, Great Panther said in a statement. Tucano completed a “significantly higher proportion” of planned stripping for the operation in the first quarter of 2020, which is expected to benefit production for the remainder of 2020 and 2021, according to the company. Lower stripping in subsequent quarters will also translate to a cost reduction, it said.
Great Panther’s Mexican operations are currently suspended as a result of the Mexican government’s decision to put a stop to all non-essential business in light of the coronavirus pandemic.
“While our Mexican operations are temporarily suspended due to federal COVID-19 restrictions, Tucano in Brazil has not been impacted by any government restrictions and we continue to proactively and collaboratively work with authorities to ensure we have the appropriate protocols and safeguards to manage the risks of COVID-19 for our employees and communities,” CEO Henderson said.
The firm said its guidance for Tucano and the Guanajuanto Mine Complex remains unchanged. It plans to provide Topia’s guidance by the end of the second quarter.
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Published at Fri, 08 May 2020 13:30:00 +0000-Great Panther Mining sees significant revenue growth in 1Q as Tucano acquisition pays off