QMX GOLD CORPORATION (TSX:QMX)(OTCQX:QMXGF) ("QMX Gold" or the
"Company") is announcing its third quarter financial and
operational results for the period ending September 30, 2012. All
figures are reported in Canadian dollars, unless noted
otherwise.
Third Quarter Financial Summary:
-- The Aurbel Gold Mill produced 5,235 ounces and realized an average
recovery rate of 93.5%.
-- Revenue on mining operations was $8.30 million for the quarter on the
sale of 5,287 ounces of gold at an average realized price of $1,651 per
ounce.
-- Cash cost of sales per ounce of gold production from Lac Herbin was
$1,366 per ounce (see non-GAAP measures).
-- The Company reported net income of $4.5 million which includes $277,000
from mine operations and a $4.6 million reversal of impairment charges
on mineral properties.
-- QMX Gold sold to Falco Pacific Resources Group Ltd. (formerly Druk
Capital Partners) interest in the Rouyn-Noranda Base Metal and Gold
Camp. QMX Gold received $5,000,000 in gross proceeds and 7,000,000
shares of Falco Pacific Resources at a deemed price of $0.25 in
consideration of this property.
-- The company also implemented a 20:1 share consolidation.
Third Quarter Financial Results
QMX Gold sold 5,287 ounces of gold to generate $8.30 million in
revenue from mining operations during the third quarter of 2012
with an average gold sale price of $1,651 (USD $1,644) per ounce.
Mine operating expenses were $7.2 million and depreciation and
depletion amounted to approximately $800,000 generating a gross
profit of $277,000. The cost of sales per ounce sold during the
current quarter, excluding depreciation and depletion, was $1,366
per ounce (see non-GAAP Measures). Cash costs continue to decrease
with improved efficiencies at the Lac Herbin Mine and the Aurbel
Mill.
QMX Gold recorded a net profit for the quarter of $4.47 million
or $0.15 per share. This includes a reversal to an impairment
charge of $4.6 million on the properties at Lac Herbin, Quebec and
gains on investments of $1.75 million, which includes the recently
acquired Falco Pacific shares (see press release of September 24,
2012). General and administrative expenses were $0.6 million.
Commenting on the results, Francois Perron, President and CEO
commented: "I am very pleased to see operational profitability at
the Lac Herbin Mine. These results are directly attributable to the
commitment of the team in Val d'Or. Our third quarter production is
in line with current forecasts and the Company is on track to
achieving its 2012 operational targets. For the Snow Lake project,
the Company continues to focus on securing additional project
financing by evaluating a number of opportunities that will fit
with the Credit Suisse financing agreement."
Financial Results for Nine Months Ending September 30, 2012
In the nine months ending September 30, 2012, QMX Gold sold a
total of 15,528 ounces of gold generating $24.55 million in revenue
for the company. The average sale price was $1,655 per ounce. In
this same period, mine operating expenses totaled $22.44 million
and depreciation amounted to $4.34 million for a gross loss of
$2.23 million. The net loss for the nine months ending September
30, 2012 was $16.63 million including an impairment charge of
$10.26 million on the Rouyn-Noranda properties and a $4.6 million
reversal of impairment charges to the Lac Herbin Properties. The
average cost of sales per ounce is $1,440 compared to $2,278 in the
same period in 2011.
Exploration Update
Exploration at Lac Herbin has been focused on infill drilling at
the FL, Apex and Bonanza Zones with the goal of increasing the mine
life. In July, the Company reported on the Bonanza Zone, where
recent drilling suggests that the zone is larger than initially
believed. Highlights from this drill program included:
-- 7.63 g/t Au over 10.50 metres (true width) from Hole LH03-316
-- 19.24 g/t Au over 2.80 meters (true width) from Hole LH03-390
Drilling was also completed at the FL Zone where mineralization
was confirmed within the inferred resource envelope. Results were
reported in September and contained the following highlights:
-- 25.9 g/t Au over 1.5 metres from hole AMAR-226
-- 22.2 g/t Au over 1.6 metres from hole AMAR-220
-- 21.5 g/t Au over 1.5 metres from hole AMAR-176
The S1 Zone will be the next zone to be reported and the Company
is aiming to have a mineral resource estimate prepared as part of
the year end activities to be released in the first quarter of
2013.
Complete interim financial statements and related Management's
Discussion and Analysis documents will be available under the
Company's profile on www.sedar.com and at the Company's website
www.qmxgold.ca
Non-GAAP Measures
The Company has included certain non-GAAP performance measures,
namely, cash costs per gold ounce sold throughout this document. In
the gold mining industry, these are common performance measures but
do not have any standardized meaning, and are non-GAAP measures. In
addition to conventional measures prepared in accordance with GAAP,
the Company and certain investors use this information to evaluate
the Company's performance and ability to generate cash, profits and
meet financial commitments. These non-GAAP measures are intended to
provide additional information and should not be considered in
isolation or as a substitute for measures of performance prepared
in accordance with GAAP. The following tables provide a
reconciliation of cash costs per gold ounce sold for the nine
months ended September 30, 2011 and 2010.
Cash cost per ounces sold:
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Three Three
months months
ending ending Nine months Nine months
September September ending June ending June
Period ending 30, 2012 30, 2011 30, 2012 30, 2011
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Revenue
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From commercial production
ounces (CAD 000's) $ 8,297 $ 2,221 $ 24,549 $ 7,907
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Ounces sold 5,287 1,477 15,582 5,723
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Mine operating expenses (CAD
000's) $ 7,221 $ 4,151 $ 22,440 $ 13,038
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Cash cost per ounce sold
(CAD) $ 1,366 $ 2,810 $ 1,440 $ 2,278
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(mining operating expenses
divided by ounces sold)
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Qualified Person
Technical programs and information included in this release have
been supervised, compiled, reviewed and approved by David Rigg,
P.Geo., the Chairman of the Company and a Qualified Person as
defined under NI 43-101.
About QMX Gold
QMX Gold Corporation is a Canadian publicly traded mining
company focusing on mine development and exploration in Quebec and
Manitoba. The Company is listed on the Toronto Stock Exchange and
effective July 5, 2012, began trading under the symbol "QMX", and
trades in the United States on the Over the Counter QX
International platform under the symbol "QMXGF". QMX Gold operates
in: Val-d'Or, Quebec and Snow Lake, Manitoba. QMX Gold continues to
operate in the Val-d'Or area with production estimated at
18,000-20,000 ounces of gold per year. The Company has also begun
to ramp-up pre-production activities at its property at the Snow
Lake Mining Camp which has a Measured and Indicated Mineral
Resources of over 720,000 oz gold and is expected to produce 80,000
ounces of gold per year as identified in the Technical Report of
the Company dated of December 10, 2010 titled "Snow Lake Mine
Re-activation Project" prepared by: Andre Roy (Eng.) Jamie Lavigne
(P.Geo), David West (P.Eng), Ian Ward (P.Eng), Matthew Parfitt
(P.Eng), Mark Bednarz (P.Geo) and available on the SEDAR profile of
the Company at www.sedar.com.
Forward-looking information:
This press release contains "forward-looking information" within
the meaning of applicable Canadian securities legislation.
Forward-looking information includes, but is not limited to,
statements with respect to the impact of these financial results
and operational developments on the timing and amount of future
exploration and development of the property, the timing and amount
of future production, and the future financial or operating
performance of Alexis and its projects. Generally, forward-looking
information can be identified by the use of forward-looking
terminology such as "plans", "expects" or "does not expect", "is
expected", "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates" or "does not anticipate", or "believes",
or variations of such words and phrases or state that certain
actions, events or results "may", "could", "would", "might" or
"will be taken", "occur" or "be achieved". Forward looking
information is subject to known and unknown risks, uncertainties
and other factors that may cause the actual results, level of
activity, performance or achievements of the Company to be
materially different from those expressed or implied by such
forward-looking information, including but not limited to those
risks described in the annual information form of the Company,
which is available under the profile of the Company on SEDAR.
Although the Company has attempted to identify important factors
that could cause actual results to differ materially from those
contained in forward-looking information, there may be other
factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such information will
prove to be accurate, as actual results and future events could
differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on
forward-looking information. The Company does not undertake to
update any forward-looking information, except in accordance with
applicable securities laws.
Contacts: QMX Gold Corporation Francois Perron President and CEO
(416) 309-2952 QMX Gold Corporation Louis Baribeau Public Relations
(514) 667-2304 QMX Gold Corporation Rob Hopkins Investor Relations
(416) 861-5899 QMX Gold Corporation Toll free: 1
877-717-3027info@qmxgold.ca www.qmxgold.ca