Galane Gold Ltd. Releases Financial And Operating Results For Q2 2022
TORONTO, ONTARIO – August 23, 2022: Galane Gold Ltd. (“Galane Gold” or the Company”) (TSX-V: GG; OTCQB: GGGOF) is pleased to announce the release of its financial results for the three and six months ended June 30, 2022.
A copy of the unaudited condensed consolidated interim financial statements for the three and six months ended June 30, 2022 prepared in accordance with International Financial Reporting Standards and the corresponding Management’s Discussion and Analysis are available under the Company’s profile on www.sedar.com. All references to “$” in this press release refer to United States dollars.
Second Quarter 2022 Highlights (“Q2 2022”)
- During Q2 2022, the sale of our Mupane property was completed, removing $17.3 million of liabilities from the Company’s balance sheet.
- Release of updated PEA on the Summit Mine and Banner Mill, demonstrating a robust financial model and a short-term path to production.
- Galaxy produced 2,179 tonnes of concentrate containing 2,346 ounces of gold (Q2 2021 - 2,155 tonnes of concentrate containing 2,415 ounces of gold).
- Earnings from operations of $0.5 million (Q2 2021 - $1.0 million).
- Positive cash flows from operating activities of $0.3 million (Q2 2021 - $0.5 million operating cash outflow).
- 1,760 payable ounces of gold sold at an operating cash cost before royalties of $1,416 per ounce(1).
- Post quarter-end, the Company entered a new offtake agreement for its Galaxy operation, providing a higher payable percentage for gold content in its concentrate and an unsecured $3 million revolving finance facility.
Year to Date 2022 Highlights (“YTD 2022”)
- Galaxy produced 4,465 tonnes of concentrate containing 5,489 ounces of gold (YTD 2021 - 3,126 tonnes of concentrate containing 3,236 ounces of gold).
- Earnings from operations of $2.3 million (YTD 2021 - $0.7 million).
- 4,117 payable ounces of gold sold at an operating cash cost before royalties of $1,216 per ounce(1).
- Positive cash flows from operating activities of $1.3 million (YTD 2021 - $1.2 million operating cash outflow).
- $1.2 million of debt repaid (YTD 2021 - $1.6 million of debt repaid).
Galane Gold CEO, Nick Brodie commented: “Q2 2022 commenced with disruption to the Company’s revenue cycle caused by the severe flooding in Durban, despite this the Galaxy operation continued to generate positive operating cash flow during the quarter. Post quarter end, shipments of the flood-affected gold concentrate have recommenced from Durban, and it is expected that all the flood-affected gold concentrate will be fully paid during Q4 2022.(2)
The sale of Mupane has recharged our balance sheet with the removal of over $17 million in liabilities and, as a result at the end of Q2 2022, the Company had net debt of less than $1 million. Consequently, post quarter end, the Company was able to finalise a new revolving finance facility for Galaxy to enable continued investment to support the ramp-up of production. (2)”
About Galane Gold
Galane Gold is an un-hedged gold producer and explorer with mining operations and exploration tenements in South Africa and New Mexico. Galane Gold is a public company and its shares are quoted on the TSX Venture Exchange under the symbol “GG” and the OTCQB under the symbol “GGGOF”. Galane Gold’s management team is comprised of senior mining professionals with extensive experience in managing mining and processing operations and large-scale exploration programmes. Galane Gold is committed to operating at world-class standards and is focused on the safety of its employees, respecting the environment, and contributing to the communities in which it operates.
(1) Cash cost is a non-GAAP measure. Refer to “Supplemental Information to Management’s Discussion and Analysis” in the Company’s Management’s Discussion and Analysis for the three and six months ended June 30, 2022, for reconciliation to measures reported in the Company’s financial statements.
(2) This is forward-looking information and is based on a number of assumptions. See “Cautionary Notes”.
Certain statements contained in this press release constitute “forward-looking statements”. All statements other than statements of historical fact contained in this press release, including, without limitation, the Company’s ability to support the ramp-up of production with its new revolving finance facility, the Company’s future financial position and results of operations, strategy, proposed acquisitions, plans, objectives, goals and targets, and any statements preceded by, followed by or that include the words “believe”, “expect”, “aim”, “intend”, “plan”, “continue”, “will”, “may”, “would”, “anticipate”, “estimate”, “forecast”, “predict”, “project”, “seek”, “should” or similar expressions or the negative thereof, are forward-looking statements. These statements are not historical facts but instead represent only the Company’s expectations, estimates and projections regarding future events. These statements are not guarantees of future performance and involve assumptions, risks and uncertainties that are difficult to predict. Therefore, actual results may differ materially from what is expressed, implied or forecasted in such forward-looking statements.
Additional factors that could cause actual results, performance or achievements to differ materially include, but are not limited to: the Company’s dependence on two mineral projects; gold price volatility; risks associated with the conduct of the Company’s mining activities in South Africa and New Mexico; regulatory, consent or permitting delays; risks relating to the Company’s exploration, development and mining activities being situated in South Africa and New Mexico; risks relating to reliance on the Company’s management team and outside contractors; risks regarding mineral resources and reserves; the Company’s inability to obtain insurance to cover all risks, on a commercially reasonable basis or at all; currency fluctuations; risks regarding the failure to generate sufficient cash flow from operations; risks relating to project financing and equity issuances; risks arising from the Company’s fair value estimates with respect to the carrying amount of mineral interests; mining tax regimes; risks arising from holding derivative instruments; the Company’s need to replace reserves depleted by production; risks and unknowns inherent in all mining projects, including the inaccuracy of reserves and resources, metallurgical recoveries and capital and operating costs of such projects; contests over title to properties, particularly title to undeveloped properties; laws and regulations governing the environment, health and safety; the ability of the communities in which the Company operates to manage and cope with the implications of COVID-19; the economic and financial implications of COVID-19 to the Company; operating or technical difficulties in connection with mining or development activities; lack of infrastructure; employee relations, labour unrest or unavailability; health risks in Africa; the Company’s interactions with surrounding communities and artisanal miners; the Company’s ability to successfully integrate acquired assets; risks related to restarting production; the speculative nature of exploration and development, including the risks of diminishing quantities or grades of reserves; development of the Company’s exploration properties into commercially viable mines; stock market volatility; conflicts of interest among certain directors and officers; lack of liquidity for shareholders of the Company; risks related to the market perception of junior gold companies; and litigation risk. Management provides forward-looking statements because it believes they provide useful information to investors when considering their investment objectives and cautions investors not to place undue reliance on forward-looking information. Consequently, all of the forward-looking statements made in this press release are qualified by these cautionary statements and other cautionary statements or factors contained herein, and there can be no assurance that the actual results or developments will be realized or, even if substantially realized, that they will have the expected consequences to, or effects on, the Company. These forward-looking statements are made as of the date of this press release and the Company assumes no obligation to update or revise them to reflect subsequent information, events or circumstances or otherwise, except as required by law.
Neither the TSX Venture Exchange nor its regulation services provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information please contact:
CEO, Galane Gold Ltd.
+ 44 7905 089878