MONTREAL, QUEBEC--(Marketwire - March 12, 2013) - SEMAFO Inc. (SMF.TO)(SMF.ST) announced today that the Corporation will include a non-cash impairment charge of approximately $60 million in the fourth quarter of 2012. The impairment charge is related to the Samira Hill mine in Niger and was prompted by the re-assessment of future cash flows to be generated by the mine following the review of technical and economical parameters. The revision takes into consideration increases in sustaining capital expenditures, consumables and operating costs as well as escalating energy costs related to the poor reliability of the Niger power grid. This non-cash accounting charge will not impact the Corporation's cash balance or normal day-to-day operations.
As part of our strategy and on-going efforts to reduce costs, optimize cash flow, capital allocation and return on investments, we will focus on quality ounces. Accordingly, Samira Hill's 2013 capital expenditures budget has been reduced to $17.5 million from $27.5 million, mainly due to lower stripping costs.
Moving forward, in keeping with the goal of building shareholder value through the creation of future cash flow and sustained solid operational performance, SEMAFO will focus on the development of its flagship Mana project with particular emphasis on the new high-grade Siou Sector. The Siou Sector has one million ounces of initial in-pit inferred resources at an average grade of 4.6 g/t Au and a recovery rate of over 95%. The Corporation expects to add the Siou Sector to reserves during the third quarter 2013 and begin mining the area in late 2014 or early 2015.
Management will continue to review strategic alternatives for the Samira Hill and Kiniero assets. SEMAFO has a strong cash position of approximately $140 million as at December 31, 2012, is debt-free and unhedged.
The Corporation is scheduled to release its consolidated annual audited financial statements for the year at TSX market open on Thursday, March 21, 2013. The financial statements will be available on the Corporation's website at www.semafo.com or at www.sedar.com.
SEMAFO will host a conference call to discuss the financial and operational results, as well as to provide an update on the Corporation's activities.
|Date:||Thursday, March 21, 2013|
|Time:||10:00 AM (EDT)|
|Tel. local & overseas:||+1 (416) 641-6715|
|Tel. North America:||1 (800) 616-7436|
The conference call will be archived for replay until April 11, 2013. To access the archived conference call, please dial 1 (800) 558-5253 and enter pass code 21646110 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 30 days.
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 "will", "future", "to be", "strategy", "on-going", "moving forward", "goal", "expects", "add", "continue", "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 execute on our strategy, the ability to create future cash flow, the ability to add the Siou Sector to reserves during the third quarter of 2013 and begin mining the area in late 2014 or early 2015, 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 2011 Annual MD&A and 2011 Annual Information Form, as updated in SEMAFO's 2012 First Quarter MD&A, 2012 Second Quarter MD&A and 2012 Third Quarter 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.