SEMAFO Reports 2012 Cash Flow from Operations of $155.4 Million

Marketwired

MONTREAL--(Marketwire - Mar 21, 2013) - SEMAFO (SMF.TO)(SMF.ST) today reported its financial and operational results for the fourth quarter and year ended December 31, 2012. All amounts are in US dollars unless otherwise stated.

2012 - The Year in Review

  • Gold production of 236,100 ounces
  • Gold sales of $388.5 million, a 2% decrease compared to 2011
  • Operating income of $34.6 million compared to $154.2 million in 2011
  • Net loss attributable to equity shareholders of $6.6 million or $(0.02) per share compared to net income attributable to equity shareholders of $111.8 million or $0.41 per share in 2011
  • Cash flow from operating activities(1) of $155.4 million or $0.57 per share
  • Discovery of the high-grade Siou Sector at Mana, with one-million ounces of initial in-pit inferred resources at an average grade of 4.62 g/t Au
  • Decision to move from an underground mining project to an improved overall economic super pit scenario resulted in a non-recurring loss of $17.0 million
  • Non-cash impairment charge of $60.0 million on the Samira Hill Mine
  • Sale of current investment resulted in a non-recurring loss of $24.3 million
  • Declaration of C$0.04 per share dividends to equity shareholders
  • Completed 60-kilometer water pipeline to accommodate Mana processing plant at a cost of $5.8 million less than the originally budgeted $30.2 million
  • Record throughput at Mana following the commissioning of Phase IV of the plant expansion
  • SEMAFO''s Board of Directors appointed Benoit Desormeaux, formerly Executive Vice-President and Chief Operating Officer to the position of President and Chief Executive Officer of the Corporation

Fourth Quarter Review

  • Gold production of 62,400 ounces, a decrease of 4% compared to the same period in 2011
  • Gold sales of $110.3 million, a 3% decrease compared to the same period in 2011
  • Non-cash impairment charge of $60.0 million on the Samira Hill Mine
  • Net loss of $25.2 million compared to net income of $33.3 million for the same period in 2011
  • Cash flow from operating activities(1) of $48.6 million or $0.18 per share compared to $54.3 million or $0.20 per share for the same period in 2011

(1) Cash flow from operating activities excludes changes in non-cash working capital items.

A Word from the CEO

For SEMAFO, 2012 was a year of transition on many levels. Although disappointing in terms of shareholder value, it nevertheless gave rise to numerous positive aspects with regard to our core business, from both strategic and operational perspectives. We achieved production and cost guidance for a fifth consecutive year. Our production totalled 236,100 gold ounces, just slightly below our 2011 results. Our annual revenues from gold sales posted only a 2% decrease from 2011 to stand at $388.5 million.

The highlight of the year from our standpoint was the discovery of the new high-grade Siou Sector at Mana. This vastly prospective area located approximately 15 kilometers east of our processing plant holds one million ounces of initial in-pit inferred resources at an average 4.62 g/t Au and a gold recovery rate of over 95%. Based on results to date, the Siou Sector where ongoing exploration work is being carried out has already become SEMAFO''s most important find ever.

Another important event was the conversion of the Mana underground project to a super-pit. This decision, although it led to a $17 million write-off, was purely an economic decision based on the best return on investment as capital expenditures are spread out over the life of mine.

SEMAFO''s reserves and resources decreased slightly to 6.6 million ounces in 2012. This is due to the removal of refractory sulphides from the south sector at Mana and the revision of Samira Hill''s reserves and resources that became uneconomic following the review of technical and economic parameters. The revision at Samira Hill resulted in a non-cash impairment of $60 million in the fourth quarter of 2012. At Mana, the inferred category grade, however, almost doubled to 3.18 g/t Au as we included the high-grade Siou Sector in this category.

A comprehensive strategic review of the Corporation conducted during the latter part of the year facilitated the establishment of a realistic plan to move forward. We validated our top ensuing long-standing priority: to create value by generating future cash flow, while maintaining our solid operational performance. As the world economy continues to change shape, we will continue to focus on quality ounces as part of our strategy and ongoing efforts to reduce costs and optimize cash flow.

Our short-term priorities are to bring the Siou Sector to reserves by the third quarter of 2013, initiate the permitting process and begin mining by the end of 2014 or early 2015. We also intend to focus exploration activities within the 20-kilometer radius of the Mana processing plant and carry out exploration on the 30-kilometer Kokoi Trend, host to the high-grade Siou Sector.

Today, with ore sourced almost exclusively from the super pit, we can sustain operations at the plant at full capacity for the next eight to ten years. Owing to the Siou''s high-grade mineralization, however, development of the sector could represent an opportunity to reduce our operating cost, boost production and ultimately increase cash flow within the next 18 to 24 months. Moreover, the south sector has yet to be added to the scenario. We believe that the Corporation''s fundamentals and potential for creating shareholder value are as strong as ever.

We believe that SEMAFO represents an undeniable investment opportunity. Today, our Corporation''s share price is significantly undervalued and far from indicative of the numerous opportunities on the horizon. We are cognizant that our Mana property will serve as the cornerstone of our Corporation''s evolution and approach to intelligently grow our business.

SEMAFO is financially sound, has a solid cash position, is debt-free and completely unhedged. Since November 2011, our Corporation has paid out three dividends. We continue to strive for excellence in health and safety and lead the way in corporate responsibility. Our dedicated team continues to pull together in the pursuit of excellence and an overall commitment to simply doing more. We are determined to optimize operations at all levels, improve efficiencies and contain costs.

We are optimistic for 2013. We have established a clear strategy to identify new quality ounces, expand reserves and resources, and build future cash flow. The task at hand is to create value and, moving forward, we are confident that we have the assets, the talent and the ability to do just that.

2012 Mineral Reserves and Resources

SEMAFO''s 2012 year-end mineral reserves totalled 36.7 million tonnes at an average grade of 2.08 g/t Au for 2.5 million ounces compared to 37.9 million tonnes at 2.18 g/t Au for 2.7 million ounces in 2011. The decrease in reserves is mainly due to 2012 production and the reduction in Samira Hill''s reserves.

The 2012 measured and indicated resources average grade increased by 15% to 1.89 g/t Au for a total 4.2 million ounces as compared to 4.7 million ounces in 2011. The decrease in resources is due to the Samira Hill revision as well as the removal of most of the refractory sulphide material from the south sector deposits (Yaho, Fofina and Fobiri), which was uneconomical according to various metallurgical tests conducted during the year. The 2012 measured, indicated and inferred resources in Mana''s south sector are mainly composed of oxide and transitional mineralization and are not refractory. 

Total inferred resources amounted to 36.3 million tonnes at an average grade of 2.57 g/t Au for 3.0 million ounces as compared to 61.4 million tonnes at 1.51 g/t Au for 3.0 million ounces in 2011. A slight gain in inferred resource ounces and the 89% increase in grade, despite the removal of the majority of the refractory sulphide material from the 2012 inferred resources are due to the inclusion of the initial in-pit inferred resources from the high-grade Siou Zone. Discovered in August 2012, Siou hosts 6.7 million tonnes at 4.62 g/t Au for close to one million ounces.

Our Flagship Mana Mine, Burkina Faso

Highlights:

  • Mana''s reserves totalled 1.9 million ounces
  • Mana''s measured and indicated resources increased by 8% to 3.0 million ounces and the average grade increased by 14% to 1.93 g/t Au
  • The Wona-Kona super pit reserves stand at 1.6 million ounces at an average grade of 2.21 g/t Au
  • Mana''s inferred resources'' average grade increased by 89% to 3.18 g/t Au resulting from the addition of the Siou Zone initial in-pit inferred resources of 999,200 ounces, bringing total inferred resources to 18.3 million tonnes at an average grade of 3.18 g/t Au for 1.9 million ounces.

Mana''s mineral reserves total 25.1 million tonnes at an average grade of 2.31 g/t Au at year-end 2012 compared to 25.7 million tonnes at an average grade of 2.40 g/t Au in 2011.

Total measured and indicated mineral resources at Mana increased by 8% in 2012 to 48.6 million tonnes at an average grade of 1.93 g/t Au, representing 3.0 million ounces. This compares to 51.4 million tonnes at an average grade of 1.69 g/t Au for 2.8 million ounces at the end of 2011. The slight increase in ounces, despite the removal of the majority of the refractory sulphide material in the south sector is due to the higher grade material at Kona at depth and the inclusion of the high-grade mineralization from the Fofina Zone.

Mana''s 2012 inferred resources totalled 18.3 million tonnes at a grade of 3.18 g/t Au, representing 1.9 million ounces as at December 31, 2012. The higher grade is due to the inclusion of the initial in-pit resources of our high-grade Siou Sector discovered in August 2012, representing 6.7 million tonnes at a grade of 4.62 g/t Au. The decrease of the overall inferred tonnage, despite of a higher resource grade is due to the removal of most of the inferred refractory sulphide resources from the south sector deposits (Yaho, Fofina and Fobiri).

Metallurgical Tests

In 2012, metallurgical tests showed that the sulphide portions for the Fofina, Fobiri and Yaho deposits had low recoveries (20% to 48%) with CIL treatment. Consequently, SEMAFO decided to investigate other process routes such as sulphide flotation, sulphide concentrate regrinding and ultimately oxidation to seek better gold recoveries. Although a combination of ultrafine grinding followed by oxidation at Fofina significantly improved recoveries to 88%, the tests also indicate that the capital expenditures and consumable costs required to achieve optimal results are not justified at current gold prices.

The Corporation, however, is currently conducting heap leaching tests on the oxide portion of the Yaho deposit to seek better economics for the south sector. The results should be available during the third quarter of 2013.

SEMAFO''s Consolidated Financial Statements and Management''s Discussion and Analysis and other relevant financial materials are available in the Investor Relations section of the Corporation''s website at www.semafo.com. These and other corporate reports are also available on the website maintained by the Canadian Securities regulators at www.sedar.com.

2012 Fourth Quarter and Year-End Conference Call

SEMAFO will host a conference call today, Thursday March 21, 2013 at 10:00 EDT to discuss this press release. Investors are invited to call the following telephone numbers to participate in the conference:

Tel. local & overseas: +1 (416) 641-6715

Tel. North America: 1 (800) 616-7436

The conference call will be archived for replay until April 10, 2013. To access the archived conference call, please dial 1 (800) 558-5253 and enter pass code 216461101 followed by the number sign (#).

A live audio webcast of the conference can be accessed through SEMAFO''s website at www.semafo.com. The webcast will be available for replay for a period of 90 days.

Annual Shareholders Meeting

SEMAFO''s Annual General Shareholders Meeting will be held on Monday, May 13, 2013 at 4:00 p.m. (EDT) at Le Centre Sheraton Montréal, Salle Drummond, 1201 René-Lévesque Boulevard West, in Montreal, Quebec. Attendees will have the opportunity to ask questions and meet the management team and members of the Board of Directors.

About SEMAFO

SEMAFO is a Canadian-based mining company with gold production and exploration activities in West Africa. The Corporation currently operates three gold mines: the Mana Mine in Burkina Faso, the Samira Hill Mine in Niger and the Kiniero Mine in Guinea. SEMAFO is committed to evolve in a conscientious manner to become a major player in its geographical area of interest. SEMAFO''s strategic focus is to maximize shareholder value by effectively managing its existing assets as well as pursuing organic and strategic growth opportunities.

CAUTION CONCERNING FORWARD-LOOKING STATEMENTS

This press release contains forward-looking statements. Forward-looking statements involve known and unknown risks, uncertainties and assumptions and accordingly, actual results and future events could differ materially from those expressed or implied in such statements. You are hence cautioned not to place undue reliance on forward-looking statements. Forward-looking statements include words or expressions such as "ongoing", "being carried out", "move forward", "priority", "create", "generating", "future", "will", "strategy", "increase", "added", "potential", "optimistic", "expand", "committed", "evolve", "become", "pursuing", "growth", "opportunities" and other similar words or expressions. Factors that could cause future results or events to differ materially from current expectations expressed or implied by the forward-looking statements include the ability to generate future cash flow, the ability to deliver on our strategy, the ability to bring the Siou Sector to reserves by the third quarter of 2013, initiate the permitting process and begin mining by the end of 2014 or early 2015, the ability to sustain operations at the Mana plant at full capacity for the next eight to ten years, the ability of the Siou Sector to reduce our operating cost, boost production and ultimately increase cash flow within the next 18 to 24 months, the ability to expand reserves and resources and build future cash flow, the ability to execute on our strategic focus, fluctuation in the price of currencies, gold or operating costs, mining industry risks, uncertainty as to calculation of mineral reserves and resources, delays, political and social stability in Africa (including our ability to maintain or renew licenses and permits) and other risks described in SEMAFO''s documents filed with Canadian securities regulatory authorities. You can find further information with respect to these and other risks in SEMAFO''s 2012 Annual MD&A and other filings made with Canadian securities regulatory authorities and available at www.sedar.com. These documents are also available on our website at www.semafo.com. SEMAFO disclaims any obligation to update or revise these forward-looking statements, except as required by applicable law.

The above information has been made public in accordance with the Swedish Securities Market Act and/or the Financial Instruments Trading Act.

Table 1

MINERAL RESERVES AND RESOURCES (As at December 31, 2012)

MINERAL RESERVES
Mines
Mana(1)(2) Burkina Faso
 
Samira Hill(2)(3) Niger
 
Kiniero(2)(4)Guinea
Total
Proven Mineral Reserves
Tonnes 12,561,600   5,237,600   1,082,300 18,881,500
Grade (g/t Au) 2.41   1.33   2.37 2.11
Ounces(5) 974,400   223,700   82,500 1,280,600
Probable Mineral Reserves
Tonnes 12,510,800   2,661,400   2,628,100 17,800,300
Grade (g/t Au) 2.20   1.10   2.23 2.04
Ounces(5) 886,300   94,200   188,800 1,169,300
TOTAL MINERAL RESERVES
Tonnes 25,072,400   7,899,000   3,710,400 36,681,800
Grade (g/t Au) 2.31   1.25   2.27 2.08
Ounces(5) 1,860,700   317,900   271,300 2,449,900

 

MINERAL RESOURCES
Mines Mana
Burkina Faso
Samira Hill
Niger
Kiniero
Guinea
Total
Measured
Tonnes 10,022,300 6,772,100 1,660,100 18,454,500
Grade (g/t Au) 1.54 1.58 2.38 1.63
Ounces(5) 496,100 344,000 126,800 966,900
Indicated
Tonnes 38,579,900 4,937,400 6,834,800 50,352,100
Grade (g/t Au) 2.03 1.23 2.31 1.99
Ounces(5) 2,521,300 195,400 507,100 3,223,800
TOTAL MINERAL RESOURCES
Tonnes 48,602,200 11,709,500 8,494,900 68,806,600
Grade (g/t Au) 1.93 1.43 2.32 1.89
Ounces(5) 3,017,400 539,400 633,900 4,190,700

 

TOTAL MINERAL RESERVES AND RESOURCES
Tonnes 73,674,600 19,608,500 12,205,300 105,488,400
Grade (g/t Au) 2.06 1.36 2.31 1.96
Ounces(5) 4,878,100 857,300 905,200 6,640,600
INFERRED MINERAL RESOURCES
Tonnes 18,252,800 10,161,600 7,929,400 36,343,800
Grade (g/t Au) 3.18 1.49 2.55 2.57
Ounces(5) 1,867,400 487,600 649,400 3,004,400
         
         
(1) The Corporation indirectly owns 90% of SEMAFO Burkina, which directly holds the interest in the Mana Mine reserves and resources.
   
(2) Mineral reserves and resources were estimated using a gold price of US$1,300 and US$1,600 per ounce respectively.
   
(3) Mineral reserves and resources at the Samira Hill Mine represent the combined reserves and resources of SML and AGMDC. The Corporation indirectly owns 80% of SML.
   
(4) The Corporation indirectly owns 85% of SEMAFO Guinée, which directly holds the interest in the Kiniero Mine reserves and resources.
   
(5) Rounding of numbers to the nearest hundreds of tonnes may present slight differences in the figures representing the ounces contained.

Table 2

MANA PROPERTY - MINERAL RESERVES AND RESOURCES (As at December 31, 2012)
DEPOSITS DECEMBER 31, 2012
PROVEN RESERVES PROBABLE RESERVES TOTAL RESERVES

Tonnes
Grade
(g/t Au)

Ounces

Tonnes
Grade
(g/t Au)

Ounces

Tonnes
Grade
(g/t Au)

Ounces
WONA-KONA 10,525,800 2.29 774,800 11,552,500 2.13 790,700 22,078,300 2.21 1,565,500
NYAFÉ 270,300 5.71 49,600 4,600 4.67 700 274,900 5.69 50,300
FOFINA 1,684,500 2.64 143,100 953,700 3.10 94,900 2,638,200 2.81 238,000
ROMPAD 81,000 2.64 6,900 0 0.00 0 81,000 2.64 6,900
TOTAL MANA 12,561,600 2.41 974,400 12,510,800 2.20 886,300 25,072,400 2.31 1,860,700

 

DEPOSITS DECEMBER 31, 2012
MEASURED RESOURCES INDICATED RESOURCES TOTAL RESOURCES

Tonnes
Grade (g/t Au)
Ounces

Tonnes
Grade (g/t Au)
Ounces

Tonnes
Grade (g/t Au)
Ounces
WONA-KONA 1,903,600 1.86 113,700 23,925,200 2.45 1,884,300 25,828,800 2.41 1,998,000
NYAFÉ 589,800 4.36 82,700 586,900 4.30 81,100 1,176,700 4.33 163,800
FOFINA 958,400 2.00 61,500 1,346,500 3.32 143,900 2,304,900 2.77 205,400
YAHO 5,832,500 0.98 183,500 12,544,800 0.99 399,700 18,377,300 0.99 583,200
FILON 67 58,100 3.61 6,700 23,900 3.79 2,900 82,000 3.66 9,600
FOBIRI 679,900 2.20 48,000 152,600 1.91 9,400 832,500 2.14 57,400
TOTAL MANA 10,022,300 1.54 496,100 38,579,900 2.03 2,521,300 48,602,200 1.93 3,017,400

 

DEPOSITS DECEMBER 31, 2012
INFERRED

Tonnes
Grade
(g/t Au)

Ounces
WONA-KONA 6,714,000 2.44 526,900
NYAFÉ 365,600 4.26 50,000
FOFINA 713,200 3.60 82,600
YAHO 1,430,100 1.64 75,500
FILON 67 27,400 3.79 3,300
FOBIRI 1,182,400 2.16 81,900
MAOULA 1,089,400 1.37 48,000
SIOU 6,730,700 4.62 999,200
TOTAL MANA 18,252,800 3.18 1,867,400

We are presenting 100% of the reserves and resources of the mines in the above table. Regarding open pit reserves, cut-off grades are established with the Ultimate Pit software in consideration of the rock type and haulage distance.

The mineral reserves and resources were estimated as at December 31, 2012 in accordance with the definitions adopted by the Canadian Institute of Mining, Metallurgy and Petroleum and incorporated into National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101"). Mineral reserves and resources estimates for the Mana Mine were carried out internally under the guidance of Michel Crevier P.Geo MScA, Vice-President Exploration and Mine Geology and SEMAFO''s Qualified Person who has reviewed this press release for accuracy and compliance.

Consolidated Results and Mining Operations

  2012   2011 Variation  
Operating Highlights          
           
Gold ounces produced 236,100   250,100 (6 %)
Gold ounces sold 231,500   249,600 (7 %)
           
(in thousands of dollars, except amounts per ounce, per tonne and per share)          
Revenues - Gold sales 388,501   395,916 (2 %)
Mining operating expenses (excluding government royalties) 164,393   150,535 9 %
Government royalties 19,979   19,857 1 %
Write-off of property, plant and equipment 16,998   - -  
Impairment of property, plant and equipment 60,000   - -  
Operating income 34,626   154,164 (78 %)
Loss on sale of current investment 24,297   - -  
Income tax expense 18,392   29,869 (38 %)
Net income (loss) attributable to equity shareholders (6,604 ) 111,759 (94 %)
           
Cash flow from operating activities(1) 155,406   171,875 (10 %)
Basic earnings (loss) per share (0.02 ) 0.41 (105 %)
Diluted earnings (loss) per share (0.02 ) 0.40 (105 %)
Operating cash flow per share(2) 0.57   0.63 (10 %)
           
Adjusted operating income(3) 111,624   154,164 (28 %)
Adjusted net income attributable to equity shareholders(3) 75,314   111,759 (33 %)
Adjusted basic earnings per share(3) 0.28   0.41 (32 %)
           
Average realized selling price (per ounce) 1,678   1,586 6 %
Cash operating cost (per ounce produced)(4) 704   591 19 %
Cash operating cost (per tonne processed)(4) 35   35 -  
Total cash cost (per ounce sold)(5) 793   677 17 %
Total cash margin (per ounce sold)(6) 885   909 (3 %)
           
(1) Cash flow from operating activities excludes changes in non-cash working capital items.
   
(2) Operating cash flow per share is a non-IFRS financial performance measure with no standard definition under IFRS. See the "Non-IFRS financial performance measures" section of the Corporation''s MD&A.
   
(3) Adjusted operating income, adjusted net income attributable to equity shareholders and adjusted basic earnings per share are non-IFRS financial performance measures with no standard definition under IFRS. In 2012, the adjusted operating income excludes the write-off of property, plant and equipment of $16,998,000 related to the underground project and $60,000,000 related to the impairment of non-financial assets of the Samira Hill Mine, while the adjusted net income attributable to equity shareholders and the adjusted basic earnings per share also exclude the loss on the sale of a current investment totalling $24,297,000, as well as the income tax expense and the non-controlling interest impact totalling $7,377,000 related to these non-recurring transactions.
   
(4) Cash operating cost is a non-IFRS financial performance measure with no standard definition under IFRS and is calculated using ounces produced and tonnes processed. See the "Non-IFRS financial performance measures" section of the Corporation''s MD&A.
   
(5) Total cash cost is a non-IFRS financial performance measure with no standard definition under IFRS and represents the mining operation expenses and the government royalties per ounce sold.
   
(6) Total cash margin is a non-IFRS financial performance measure with no standard definition under IFRS and is calculated using the average realized selling price and the total cash cost.

Fourth Quarter Financial and Operating Highlights

  Three-month period    
  ended December 31,    
  2012   2011 Variation  
           
Gold ounces produced 62,400   64,800 (4 %)
Gold ounces sold 64,200   67,200 (4 %)
           
(in thousands of dollars, except amounts per ounce, per tonne and per share)          
Revenues - Gold sales 110,305   113,854 (3 %)
Operating income (loss) (28,055 ) 47,448 (159 %)
Net income (loss) attributable to equity shareholders (25,156 ) 33,277 (176 %)
Basic earnings (loss) per share (0.09 ) 0.12 (175 %)
Diluted earnings (loss) per share (0.09 ) 0.12 (175 %)
Adjusted operating income(1) 31,945   47,448 (33 %)
Adjusted net income attributable to equity shareholders(1) 22,339   33,277 (33 %)
Adjusted basic earnings per share(1) 0.08   0.12 (33 %)
           
Cash flow from operating activities(2) 48,564   54,325 (11 %)
Operating cash flow per share(3) 0.18   0.20 (10 %)
           
Average realized selling price (per ounce) 1,718   1,694 1 %
Cash operating cost (per ounce produced)(4) 695   559 24 %
Cash operating cost (per tonne processed)(4) 34   35 (3 %)
Total cash cost (per ounce sold)(5) 788   665 18 %
Total cash margin (per ounce sold)(6) 930   1,029 (10 %)
           
(1) Adjusted operating income, adjusted net income attributable to equity shareholders and adjusted basic earnings per share are non-IFRS financial performance measures with no standard definition under IFRS. In 2012, the adjusted operating income excludes the write-off of property, plant and equipment of $60,000,000 related to the impairment of non-financial assets of the Samira Hill Mine, while the adjusted net income attributable to equity shareholders and the adjusted basic earnings per share also exclude the income tax recovery expense and the non-controlling interest impact totalling $12,505,000 related to this non-recurring transaction.
   
(2) Cash flow from operating activities excludes changes in non-cash working capital items
   
(3) Operating cash flow per share is a non-IFRS financial performance measure with no standard definition under IFRS. See the "Non-IFRS financial performance measures" section of this MD&A.
   
(4) Cash operating cost is a non-IFRS financial performance measure with no standard definition under IFRS and is calculated using ounces produced and tonnes processed. See the "Non-IFRS financial performance measures" section of this MD&A.
   
(5) Total cash cost is a non-IFRS financial performance measure with no standard definition under IFRS and represents the mining operation expenses and the government royalties per ounce sold.
   
(6) Total cash margin is a non-IFRS financial performance measure with no standard definition under IFRS and is calculated using the average realized selling price and the total cash cost.
   
   
Consolidated Statement of Financial Position
(Expressed in thousands of US dollars)
  As at As at
  December 31, December 31,
  2012 2011
  $ $
Assets    
     
Current assets    
Cash and cash equivalents 139,451 178,713
Trade and other receivables 30,395 43,022
Investment - 22,307
Inventories 96,829 81,639
Other current assets 6,432 5,517
  273,107 331,198
Non-current assets    
Restricted cash 923 1,226
Property, plant and equipment 406,030 362,187
Investment 19,600 29,400
Deferred income tax asset 3,000 -
  429,553 392,813
Total assets 702,660 724,011
     
Liabilities    
     
Current liabilities    
Trade payables and accrued liabilities 67,020 58,010
Provisions 2,588 -
Advance payable 915 -
Income tax payable 8,276 15,509
Dividends payable 5,492 5,348
  84,291 78,867
Non-current liabilities    
Restricted share unit liabilities 2,001 1,090
Advance payable - 2,102
Provisions 12,487 8,505
Deferred income tax liabilities 2,040 6,954
Total liabilities 100,819 97,518
     
Equity    
     
Equity Shareholders    
Share capital 455,179 454,746
Contributed surplus 12,232 10,935
Accumulated other comprehensive income - 5,686
Retained earnings 120,152 138,467
  587,563 609,834
Non-controlling interests 14,278 16,659
     
Total equity 601,841 626,493
Total liabilities and equity 702,660 724,011
     
     
     
Consolidated Statement of Income (Loss)
For the Years Ended December 31, 2012 and 2011
(Expressed in thousands of US dollars, except per share amounts)
  2012   2011  
  $   $  
         
         
Revenue - Gold sales 388,501   395,916  
         
Costs of operations        
Mining operation expenses 184,372   170,392  
Depreciation of property, plant and equipment 59,248   41,210  
General and administrative 24,834   22,224  
Corporate social responsibility expenses 5,377   3,393  
Share-based compensation 3,046   4,533  
Write-off of property, plant and equipment 16,998   -  
Impairment of property, plant and equipment 60,000   -  
         
Operating income 34,626   154,164  
         
         
Other expenses (income)        
Finance income (295 ) (439 )
Finance costs 2,023   1,728  
Foreign exchange loss (gain) (735 ) 247  
Loss on the sale of current investment 24,297   -  
         
         
Income before income taxes 9,336   152,628  
         
         
Income tax expense (recovery)        
Current 24,883   25,858  
Deferred (6,491 ) 4,011  
  18,392   29,869  
         
Net income (loss) for the year (9,056 ) 122,759  
         
Attributable to:        
Equity shareholders (6,604 ) 111,759  
Non-controlling interests (2,452 ) 11,000  
  (9,056 ) 122,759  
         
Earnings (loss) per share        
Basic (0.02 ) 0.41  
Diluted (0.02 ) 0.40  
         
         
         
Consolidated Statement of Income (Loss)
For the Years Ended December 31, 2012 and 2011
(Expressed in thousands of US dollars, except per share amounts)
  2012   2011  
  $   $  
         
         
Net income (loss) for the year (9,056 ) 122,759  
         
Other comprehensive loss        
Changes in fair value of investment in GoviEx (net of tax impact of $1,320) (8,480 ) -  
Changes in fair value of current investment (net tax impact of nil) (21,503 ) (2,794 )
Reclassification of accumulated other comprehensive loss to net loss related to current investment sold (net of tax impact of nil) 24,297   -  
         
Other comprehensive loss for the year, net of tax (5,686 ) (2,794 )
         
Total comprehensive income (loss) for the year (14,742 ) 119,965  
Attribuable to:        
Equity shareholders (12,290 ) 108,965  
Non-controlling interests (2,452 ) 11,000  
  (14,742 ) 119,965  
         
         
         
Consolidated Statements of Cash Flows
For the Years Ended December 31, 2012 and 2011
(Expressed in thousands of US dollars)
  2012   2011  
  $   $  
         
Cash flows from (used in):        
         
Operating activities        
Net income (loss) for the year (9,056 ) 122,759  
Adjustments for:        
  Depreciation of property, plant and equipment 59,248   41,210  
  Share-based compensation 3,046   4,533  
  Non-cash finance costs 1,409   874  
  Unrealized foreign exchange loss (gain) 1,975   (1,512 )
  Write-off of property, plant and equipment 16,998   -  
  Loss on the sale of current investment 24,297   -  
  Impairment of property, plant and equipment 60,000   -  
  Deferred income taxes expense (recovery) (6,491 ) 4,011  
  Provisions 3,980   -  
  155,406   171,875  
Changes in non-cash working capital items (750 ) (33,828 )
         
  154,656   138,047  
Financing activities        
Reimbursement of long-term debt -   (15,000 )
Proceeds on issuance of share capital 315   1,643  
Reimbursement of advance payable (2,000 ) -  
Payment of dividends to non-controlling interest (787 ) -  
Payment of dividends to equity shareholders (10,709 ) -  
         
  (13,181 ) (13,357 )
Investing activities        
Current investment (4,813 ) (25,101 )
Proceeds from the sale of current investment 5,617   -  
Acquisitions of property, plant and equipment (180,766 ) (145,634 )
Decrease in restricted cash 303   3,181  
         
  (179,659 ) (167,554 )
         
Effect of exchange rate changes on cash and cash equivalents (1,078 ) 1,138  
         
Change in cash and cash equivalents during the year (39,262 ) (41,726 )
Cash and cash equivalents - beginning of year 178,713   220,439  
         
Cash and cash equivalents - end of year 139,451   178,713  
         
Interest paid -   724  
Interest received 295   439  
Income tax paid 29,377   29,694  
         
         
Contact:
SEMAFO
Robert LaValliere
Vice-President, Investor Relations
Cell: +1 (514) 240 2780
robert.lavalliere@semafo.com
Sofia St Laurent
Communications & Investor Relations
Tel. local & overseas: +1 (514) 744 4408
North America Toll-Free: 1 (888) 744 4408
sofia.stlaurent@semafo.com
www.semafo.com
Maria Bang
Brunswick Group Stockholm
+46 (8) 410 32 189
mbang@brunswickgroup.com

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