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Yamana Gold Announces Fourth Quarter and Full Year 2018 Results

Yamana Gold Announces Fourth Quarter and Full Year 2018 Results

TORONTO, Feb. 14, 2019 (GLOBE NEWSWIRE) -- YAMANA GOLD INC. (TSX:YRI; NYSE:AUY) (“Yamana” or “the Company”) is herein reporting its financial and operational results for the fourth quarter and full year 2018, and its Mineral Reserve and Mineral Resource estimates as at December 31, 2018.

FOURTH QUARTER HIGHLIGHTS

Gold equivalent ounce (“GEO”)(1) production from Yamana Mines(2) for the fourth quarter was 310,369, including 270,193 ounces of gold and 3.26 million ounces of silver.  Total Yamana gold production(3) was 292,484 ounces.  The Company also produced 39.0 million pounds of copper.  

Full year GEO production from Yamana Mines was 1,041,350, including 940,619 ounces of gold and 8.02 million ounces of silver.  Full year copper production was 129.2 million pounds.

Full year gold and copper production from Yamana Mines exceeded the higher guidance levels set in October of last year while full year silver production exceeded the lower guidance provided at that time. Original guidance set in February 2018 was for 900,000 ounces of gold, 120 million pounds of copper and 8.15 million ounces of silver.

Fourth quarter costs for Yamana Mines included all-in sustaining costs (“AISC”) on a by-product basis(4) of $656 per GEO; cash costs on a by-product basis(4) of $418 per GEO; and total cost of sales of $1,019 per GEO.  Full year costs for Yamana Mines included AISC on a by-product basis(4) of $699 per GEO; cash costs on a by-product basis(4) of $448 per GEO; and total cost of sales of $1,028 per GEO, which was in line with or better than guided ranges for the cost metrics.  Refer to page 18 of this press release for additional information on costs by metal on a co-product and by-product basis.  Going forward, reported cost metrics and cost guidance will reflect a change to the presentation methodology.  Specifically, the Company, as an active member of the World Gold Council, has adopted the updated version of the Guidance Note on AISC, among other changes, that are detailed in Section 2 of the Company’s fourth quarter 2018 Management’s Discussion & Analysis, which has been filed on SEDAR.  In the Company’s 2019-2021 Outlook press release, issued on February 14, 2019, cost metrics for 2018 have been restated for the updated methodology to facilitate direct comparisons.

(All amounts are expressed in United States dollars unless otherwise indicated.)

  1. Gold equivalent ounces include gold plus silver at a ratio of 81.3:1 for Q4 2018 and 79.6:1 for the full year 2018.
  2. Yamana Mines include Chapada, El Peñón, Canadian Malartic, Minera Florida, Jacobina and Cerro Moro.
  3. Total Yamana production includes production from Gualcamayo.
  4. Refers to a non-GAAP financial measure or an additional line item or subtotal in financial statements. Please see the discussion included at the end of this press release under the heading “Non-GAAP Financial Measures and Additional Line Items and Subtotals in Financial Statements”. Reconciliations for all non-GAAP financial measures are available at www.yamana.com/Q42018 and in Section 11 of the Company’s fourth quarter 2018 Management’s Discussion & Analysis, which has been filed on SEDAR.

Adjusted Earnings(4) for the three months ended December 31, 2018 excluding certain items (see below), were $26.2 million or $0.03 per share.  Net loss attributable to Yamana equity holders for the same period, was $61.4 million or $0.06 per share basic and diluted.  This includes certain non-cash and other items that may not be reflective of current and ongoing operations, which reduced the Company’s net income by $87.6 million, or $0.09 per share basic and diluted. 

Cash flows from operating activities for the fourth quarter were $114.7 million and cash flows from operating activities before net change in working capital(4) were $115.8 million.  Fourth quarter cash flows were net of amortization of deferred revenue, $33.3 million of which related to deferred revenue recognized attributable to deliveries under the Company’s copper advanced sales program during the quarter.  Deliveries under the Company's copper advanced sales program began during the third quarter 2018 and will continue until mid-2019.  If not for the timing difference of cash proceeds attributable to this transaction, the Company’s cash flows from operating activities before net change in working capital would have been higher by those amounts during the quarter as follows:

(In millions of US Dollars, unless otherwise noted) For the three months ended  
Illustration of impact due to copper advanced sales program March 31, 2018 June 30, 2018 September 30,
2018
December 31, 2018 March 31, 2019(6) June 30, 2019(6) Cumulative impact
Copper pounds to be delivered per contract (millions)       13.2   10.7 8.2 8.2 40.3
Cash flows from operating activities before net change in working capital (5) $ 206.4   $ 157.5 $ 86.6 $ 115.8 n/a n/a  
Impact due to copper advanced sales program   (125.0 )     41.7   33.3 25.1 24.9
Cash flows from operating activities before net change in working capital, normalized for the copper advanced sales program (5) $ 81.4   $ 157.5 $ 128.3 $ 149.1 n/a n/a  
                         
  1. Refers to a non-GAAP financial measure or an additional line item or subtotal in financial statements.  Please see the discussion included at the end of this press release under the heading “Non-GAAP Financial Measures and Additional Line Items and Subtotals in Financial Statements”.   Reconciliations for all non-GAAP financial measures are available at www.yamana.com/Q42018 and in Section 11 of the Company’s fourth quarter 2018 Management’s Discussion & Analysis, which has been filed on SEDAR. Adjusted operating cash flows are adjusted for payments not reflective of current period operations and advance payments received pursuant to metal purchase agreements.
  2. For illustration purposes only; the Company intends to provide information each subsequent period reflecting the impact due to the copper advanced sales program over its term.

A non-cash impairment reversal of $150.0 million in respect of Jacobina was recognized following the significant increase in mineral reserves and mineral resources, which extends the life of the mine, and other operational improvements.  The reversal was offset by non-cash accounting impairments of $151.0 million in respect of Minera Florida and $45.0 million in respect of goodwill on the acquisition of Canadian Malartic.  No indicators of impairment or reversal were identified for the other operating mine sites.  In addition, the current quarter includes an income tax expense of $33.3 million incurred and payable at the end of the year, following an administrative interpretation of relevant tax legislation and approach by Brazilian tax authorities under that tax legislation in December. The expense was unexpected, not consistent with the Company's interpretations of the tax legislation and inconsistent with past practice. The Company has made the payment so as to avoid penalties and interest but in respect of which, the Company is pursuing legal recourse and remedies.  Adjustments to net earnings during the periods noted below are as follows:

Summary of Certain Non-Cash and Other Items Included in Net Loss

  Three Months Ending Dec 31st Twelve Months Ending Dec 31st
  2018   2017   2018   2017  
Non-cash unrealized foreign exchange losses/(gains) 3.2   (1.2 ) 9.5   15.0  
Share-based payments/mark-to-market of deferred share units (0.5 ) 3.7   5.3   12.8  
Mark-to-market (gains) losses on derivative contracts (2.6 ) 12.8   (9.4 ) 9.3  
Net mark-to-market losses (gains) on investment and other assets 0.9   (0.5 ) 9.8   2.5  
Revision in estimates and liabilities including contingencies 0.3   1.9   12.9   (26.6 )
Gain on sale of subsidiaries (2.7 )   (73.7 )  
Impairment (reversal) of mining and non-operational mineral properties, and properties held for sale (13.0 ) 356.4   250.0   356.5  
Impairment of goodwill 45.0   -   45.0     -  
Financing costs paid on early note redemption     14.7    
Reorganization costs 2.2   1.2   10.1   4.8  
Other provisions, write-downs and adjustments 16.4   (0.5 ) 34.9   18.5  
Non-cash tax unrealized foreign exchange losses/(gains) (43.2 ) 11.6   151.9   9.9  
Income tax effect of adjustments and other one-time tax adjustments 81.6   (141.3 ) (64.4 ) (143.4 )
TOTAL ADJUSTMENTS(7) 87.6   244.1   396.5   259.3  
Increase to net loss per share 0.09   0.26   0.42   0.27  
                 
  1. For the three months ended December 31, 2018, net loss from operations, attributable to Yamana equity holders, would be adjusted by an increase of $87.6 million (2017 - $244.1 million).  For the twelve months ended December 31, 2018, net earnings from operations, attributable to Yamana equity holders, would be adjusted by an increase of $396.5 million (2017 - $259.3 million).

In the fourth quarter of 2018, the Company completed the previously announced sale of the Gualcamayo mine in Argentina to Mineros S.A.  The Company received consideration with a total value of approximately $85 million, which includes cash proceeds of $30 million; $30 million in additional payments related to the advancement of the Deep Carbonates project; and royalties related to metal production at Gualcamayo and the Deep Carbonates project.  The consideration received offers significant upside in the case of new oxide discoveries, higher gold prices and/or development of the Deep Carbonates project, thereby preserving considerable optionality.  The transaction also includes an option for Mineros to acquire up to a 51% interest in the La Pepa project in Chile.

The Company's exploration programs continue to deliver on mineral resources discovery and mineral reserve replacement and growth.  The exploration program successfully increased gold mineral reserves to replace 2018 mineral depletion, excluding assets that were disposed of in 2018.  On the same basis, measured and indicated gold mineral resources and inferred mineral resources increased by 5% and 7%, respectively.  For silver, mineral reserves decreased 3%, measured and indicated mineral resources decreased 4% and inferred mineral resources decreased 3%.  For copper, mineral reserves increased 6%, measured and indicated mineral resources increased 55% and inferred mineral resources increased 211%.

The balance sheet as at December 31, 2018 includes cash and cash equivalents of $98.5 million with available credit of $705.0 million for total liquidity of $803.5 million. Net debt(4) as at December 31, 2018, was $1.66 billion.

Daniel Racine, Yamana’s President and Chief Executive Officer, commented as follows: “In 2018 we achieved another year of exceeding our production guidance for all metals and at costs better than or in line with our guidance.  Gold and copper exceeded the increased guidance levels we announced in October, while silver production exceeded the guidance that was lowered at that time. Our operational performance would not have been possible without our success in delivering Cerro Moro on time and on budget and exceeding expectations on both production and costs through the first six months of commercial production.

Throughout the year we also advanced several strategic initiatives, including closing the sale of the Canadian Malartic exploration properties, the Gualcamayo mine and completion of the business combination between Brio Gold and Leagold in addition to the ongoing evaluation and engagement in discussions relating to scenarios to develop Agua Rica.

Overall, we remain in a strong position to carry the Company’s health and safety, operational, and balance sheet momentum into 2019.”

DEVELOPMENT, OPTIMIZATION, AND STRATEGIC INITIATIVES

Chapada: The Company continues to advance its exploration program with the objective of identifying higher-grade copper and gold opportunities that are near the Chapada mine, completing infill drilling of the Sucupira and Baru deposits which would lead to a pit expansion, and advancing district scale targets.  Mineralization has been identified along a 15-kilometre trend with numerous prospective areas under consideration for further drilling.  Infill drilling in the Baru area is expected to reduce stripping ratios for the Sucupira deposit and drilling on oxide mineralization, such as Hidrotermalito, brings the potential for heap leaching opportunities that could complement the Suruca Oxides Project.  Notwithstanding the focus on the exploration potential to discover higher-grade copper and gold areas, the Company has also advanced other projects that are expected to further enhance returns from the Chapada mine.

To this end, the Company has completed studies and evaluations on several of the development opportunities at Chapada and has embarked on a feasibility-level review of a three-phase plan at Chapada. These opportunities range in scope from plant optimization initiatives to enhance copper and gold recoveries, to plant expansions to bring forward cash flows, and pit wall pushbacks to expose higher-grade zones.  The study and evaluations include third party design and engineering, estimates of capital expenses, production and operating cost forecasts.

Given the nature of the opportunities, the projects can be considered on their own or as part of a phased development plan. This flexibility in approach allows the Company to balance the maximization of value at Chapada with the allocation of capital across the broader Company portfolio.

The Phase 1- Plant Optimization Work, with expected recovery improvements in the range of 2% for both metals, has been approved.  Associated capital expenditures are estimated to be approximately $9 million. The Company is continuing to prioritize engineering for long lead-time equipment for Phase 1 and, during the fourth quarter, the flotation circuit expansion continued as planned with the installation of six new DFR flotation cells.  Commissioning is scheduled for mid-2019.

Engineering is being advanced for Phases 2 and 3, an expansion of the Chapada mill, and pushback of the Chapada pit wall to expose higher grade Sucupira ores, respectively.  While review of these projects are in the evaluation process, the Company does not anticipate the allocation of significant expansionary capital for these projects before 2021.

Based on the work completed to date, the Company estimates the phased plan will provide the foundation to sustain annual production in the range of 100,000 to 110,000 ounces of gold (not including contributions to gold production from identified higher-grade areas of Suruca, which is a gold-only ore body) and 150 to 160 million pounds of copper until at least 2034. This represents an opportunity to deliver significant cash flow increases and cash flow returns on invested capital and an increase to the production outlook, as disclosed in the Chapada NI 43-101 Technical Report dated March 21, 2018.  Further project details are expected to be available in mid-2019 with the completion of the Feasibility Study.  A development decision for Phase 2 is expected to follow in 2020.

Suruca - Gold-Only Oxide and Sulphide Development Opportunity

Concurrent with the multi-phase plan for Chapada, development of the gold-only Suruca oxides deposit continues to be evaluated as a standalone heap leach operation for which a feasibility study level update has been completed.  Furthermore, the Suruca Sulphides project has been updated in the 2018 exploration results for these ore bodies resulting in an increase of gold mineral resources. The integrated scenario for Suruca ore bodies includes processing of the oxides through a heap leach and processing of the gold-only sulphides through a carbon-in-leach ("CIL") plant located at Chapada.  Alternatives to process the sulphide portion of Suruca earlier in the life of mine are currently being contemplated, including an exploration program designed to test further extensions of the sulphide mineralization and metallurgical test work. The Company expects to continue this development program through 2019 in order to build on the results from the 2017 and 2018 programs, which resulted in extensions of the oxide and sulphide deposits.

Canadian Malartic: The Canadian Malartic Extension Project is continuing according to plan, with contributions from Barnat expected to begin in 2019 with more meaningful contributions in 2020.  On a 50% basis, expansionary capex is expected to be $37 million, of which $34 million is earmarked for the extension project in 2019.  Work in the fourth quarter, continued to focus on the highway 117 road deviation, pit preparation and tailings expansion.

OTHER OPTIMIZATION AND MONETIZATION INITIATIVES

Agua Rica: The Company is continuing its evaluation of and engagement in discussions relating to various development scenarios for Agua Rica.  This includes an integration scenario between Agua Rica and Alumbrera pursuant to which a joint pre-feasibility study has started. Concurrently, the Company continues the engagement with the other partners of Alumbrera and with various other stakeholders at the national and provincial level.  Separately, the Company continues to advance alternatives for the development of Agua Rica.  This includes technical work and analysis for project development options for Agua Rica, as well as the review and consideration of various strategic alternatives, all in an effort to advance the project and surface value.  Considerable effort has been undertaken to advance two development scenarios, one a large-scale open pit integrated operation and the other an initially smaller scale but scalable standalone operation.  The large-scale open pit scenario contemplates the aforementioned integration with the neighboring Alumbrera mine in which the Company holds a 12.5% interest and for which it expects to complete an updated pre-feasibility study during the first half of 2019.

Suyai: The Company previously completed a scoping study that evaluated two options for ore processing, both of which provide favorable project economics.  The first considered the construction of a CIL processing facility for the on-site production of gold and silver in the form of doré. The second considered the construction of a processing facility for on-site production of gold and silver contained in a high-grade concentrate, which would be shipped abroad for subsequent precious metal recovery.  Both approaches considered an identical underground configuration with average annual production expected to be in excess of 200,000 ounces of gold and 300,000 ounces of silver. The Company believes both scenarios address past concerns regarding open pit mining, and the development scenario that includes production of an on-site concentrate addresses many of the past concerns regarding the use of cyanide, and would potentially meet provincial regulations currently in place in Chubut. The Company will work with local stakeholders to obtain and sustain its social license should the project progress to a more advanced stage.

The Company continues to pursue development plans and other strategic alternatives for the project. Given the extensive amount of work performed, to date the existing scoping study could rapidly progress to a feasibility study allowing for the project to be developed in a short time frame.  The Suyai project is one of the highest gold grade development-ready projects in the Americas.  While a financial adviser has not been retained at this time, the Company is evaluating its strategic alternatives in addition to development of the project.

Monument Bay: The Monument Bay deposits are hosted in the Stull Lake Greenstone Belt comprised by three volcanic assemblages, ranging in age from 2.85 to 2.71 Ga.  Gold and tungsten mineralization occurs along the steeply north dipping Twin Lakes Shear Zone and the AZ Sheer Zone.

In 2018 approximately 16,270 metres of drilling were completed on the Monument Bay project.  The focus was testing targets near the Twin Lakes deposit and testing regional targets.  In addition, during the period a new geological interpretation of the deposit was formed and is expected to form the basis for an updated block model and mineral resource estimate.  Groundwork is continuing and generating prospects for follow-up testing in 2019.

On September 13, 2018, the Company signed an Exploration Agreement with Red Sucker Lake First Nations in relation to the Monument Bay exploration site in Northern Manitoba.  This is an important step allowing the Company to solidify a strategic collaboration with this community, as it continues to advance the project.

Other: The Company continues to pursue development and strategic initiatives for the 56.7% held Agua De La Falda joint venture with Codelco, located in northern Chile.  The historical Jeronimo Feasibility Study focused on maximizing production from the sulfide deposits. The Company completed the study of a low capital start-up project based on the remaining oxide inventory with positive results and is evaluating exploration plans on the highly prospective claims surrounding the mine.  Agua De La Falda has installed processing capacity and infrastructure.

YEAR END MINERAL RESERVES AND MINERAL RESOURCES SUMMARY

As at December 31, 2018.

Proven and Probable Mineral Reserves    
  Tonnes (000s) Grade (g/t) Contained oz. (000s)
Gold 865,653 0.45 12,496
Silver 11,736 174.5 65,828
  Tonnes (000s) Grade (%) Contained lbs (M)
Copper 673,357 0.25 3,784
       
Measured and Indicated Mineral Resources    
  Tonnes (000s) Grade (g/t) Contained oz. (000s)
Gold 771,033 0.64 15,941
Silver 13,807 84.1 37,317
  Tonnes (000s) Grade (%) Contained lbs (M)
Copper 431,522 0.22 2,090
       
Inferred Mineral Resources    
  Tonnes (000s) Grade (g/t) Contained oz. (000s)
Gold 333,516 0.95 10,162
Silver 25,770 64.4 53,377
  Tonnes (000s) Grade (%) Contained lbs (M)
Copper 156,928 0.23 785

Additional details relating to the Company’s mineral reserve and mineral resource estimates as at December 31, 2018 are presented below. 

Chapada, Brazil

As the result of the continued definition and expansion of the Sucupira mineral reserve, immediately adjacent to the main Chapada pit, gold and copper mineral reserves increased by 6% and 7%, respectively, over the prior year, representing a significant overall improvement over depletion in 2018. Gold measured and indicated mineral resources increased by 20%, while copper increased by 54% compared to the prior year, following the drilling for extensions of the mineral envelopes at Corpo Sul under the Bois River and Santa Cruz mineral resources, in addition to Sucupira and Baru.  Gold inferred mineral resources are unchanged from 2017, while copper increased significantly.

The following chart summarizes the changes in gold mineral reserves at Chapada as at December 31, 2018 compared to the prior period.

A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/a2b0885d-7377-4c2d-a074-05caed4a106c

  1. Gold mineral reserves in thousands of ounces.
  2. Additions at Sucupira and Baru as a result of infill drilling and engineering studies.

The following chart summarizes the changes in copper mineral reserves at Chapada as at December 31, 2018 compared to the prior period.

A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/945eebb7-1176-4393-8531-e046c6728fba

  1. Copper mineral reserves in millions of pounds.
  2. Additions at Sucupira and Baru as a result of infill drilling and engineering studies.

El Peñón, Chile

El Peñón's mineral reserves increased by 5% for gold and 6% for silver over mining depletion in 2018. Gold measured and indicated mineral resources increased by 24%, while silver increased by 30% compared to the prior year, continuing from numerous secondary vein structures in the east mine area. Lower gold and silver inferred mineral resources reflect conversion to indicated mineral resources.

The following chart summarizes the changes in gold mineral reserves at El Peñón as at December 31, 2018 compared to the prior period.

A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/25d422cc-335c-4a1f-842e-7e1d58bd7d9b

  1. Gold mineral reserves in thousands of ounces.
  2. Adjustments with optimization of mine design.
  3. Additions with infill drilling and conversion of the low grade stockpile after sampling and metallurgical testing.

The following chart summarizes the changes in silver mineral reserves at El Peñón as at December 31, 2018 compared to the prior period.

A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/e873b1d4-bbfa-481d-9174-8a57c021c142

  1. Silver mineral reserves in thousands of ounces.
  2. Adjustments with optimization of mine design.
  3. Additions with infill drilling and conversion of the low grade stockpile after sampling and metallurgical testing.

Canadian Malartic including Odyssey, Canada (50%)

Gold mineral reserves reflect depletion associated with 2018 production at Canadian Malartic. Separately, much of the mineral resource accretion in 2018 is associated with the East Malartic underground. Additional drilling, also at East Malartic and Odyssey, contributed to the 33% increase in gold measured and indicated mineral resources and the 1% increase in gold inferred mineral resources.

A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/93a3cf9e-9188-461c-a270-206a08d47e6c

  1. Gold mineral reserves in thousands of ounces.
  2. Adjustments to pit design and cut-off grade.

Jacobina, Brazil

Jacobina successfully increased gold mineral reserves by 11% over 2018 mining depletion.  Measured and indicated mineral resources are in line with 2017 and reflect the conversion to mineral reserves. Inferred mineral resources increased significantly by over 800,000 ounces of gold, despite increasing the cut-off grade from 0.5 g/t to 1.0 g/t.  The exploration program at Jacobina also achieved the main goal for the year which was to identify and define high-grade mineralization close to current infrastructure.  Several zones were defined including down dip of João Belo, Morro do Vento South and the northern portion, Serra do Corrego and Canavieiras Sul.  In 2019, the exploratory drilling will continue focusing on the extension of these high-grade zones, including the south extension of João Belo.  The definition drilling program will continue in 2019 to increase confidence in reef geometry and fault locations for sectors planned to be mined within the next three years.

The following chart summarizes the changes in gold mineral reserves at Jacobina as at December 31, 2018 compared to the prior period.

A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/286fc621-c8b1-438d-8505-662cb7a8f53f

  1. Gold mineral reserves in thousands of ounces.
  2. Additions mostly at Morro do Vento with additional reefs.

Minera Florida, Chile

At Minera Florida, the decrease in mineral reserves is a result of mine depletion and the application of an updated geological model and more conservative design parameters with higher cut-off grades, especially around the historic mining areas.  Gold measured and indicated mineral resources increased by 5%, resulting from an upgrade of certain inferred mineral resources. The PVS and Pataguas zones will be the main targets of 2019 exploration drilling.

The following chart summarizes the changes in gold mineral reserves at Minera Florida as at December 31, 2018 compared to the prior period.

A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/c9fc2b40-b146-4ad3-82a3-3daed9c27d8b

  1. Gold mineral reserves in thousands of ounces.
  2. Adjustment to geological interpretation and cut-off grade.
  3. Additions due to infill drilling.

Cerro Moro, Argentina

At Cerro Moro, increases in gold and silver mineral reserves partially offset depletion associated with 2018 production.  The main increases came from the discovery of new high grade, near surface vein Veronica and the extensions of Nini.  Also drilling in the core mine area returned mineralized intercepts at Michelle, Milagros and Tres Lomas which will be followed-up upon in 2019.  Updated economical parameters with higher cut-off grades for both mineral reserves and mineral resources had the impact of reducing tonnage, but increasing the overall grade.  Due to the previous focus of the site on project development, start-up and ramp-up of operations, long-term exploration effort began in 2018 and as result the current mineral resources do not consider drilling results for the last four months of the year. These results are in the process of being analyzed and are expected to provide good quality targets for 2019.  This ultimately resulted in 13% lower gold for remaining measured and indicated mineral resources and 24% lower inferred mineral resources. Regional exploration south of the mine area intercepted a wide zone of mineralization at Naty. These zones are expected to undergo further drilling in 2019, as part of the increased exploration budget allocation to the mine.

The following chart summarizes the changes in gold mineral reserves at Cerro Moro as at December 31, 2018 compared to the prior period.

A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/ce40cb4e-75b5-4d71-a621-201a6ee21ea5

  1. Gold mineral reserves in thousands of ounces.
  2. Adjustments to cut-off grade and mine design parameters.
  3. Additions of new zones, especially Veronica and Nini.

The following chart summarizes the changes in silver mineral reserves at Cerro Moro as at December 31, 2018 compared to the prior period.

A photo accompanying this announcement is available at http://www.globenewswire.com/NewsRoom/AttachmentNg/789900bd-8843-4438-b4bf-2e0fbf3aff8b

  1. Silver mineral reserves in thousands of ounces.
  2. Adjustments to cut-off grade and mine design parameters.
  3. Additions of new zones, especially Veronica and Nini.

KEY STATISTICS
Key operating and financial statistics for the fourth quarter and full year 2018 are outlined in the following tables.

Financial Summary

  Three Months Ending Dec 31st Twelve Months Ending Dec 31st
(In millions of US Dollars except for shares and per share amounts) 2018   2017   2018   2017  
Revenue 483.4   478.8   1,798.5   1,803.8  
Cost of sales excluding depletion, depreciation and amortization (266.2 ) (264.7 ) (1,010.0 ) (1,042.4 )
Depletion, depreciation and amortization (130.9 ) (100.9 ) (438.3 ) (426.8 )
Total cost of sales (397.1 ) (365.6 ) (1,448.3 ) (1,469.2 )
Mine operating earnings (loss) 40.3   (143.7 ) 201.2   77.7  
General and administrative expenses (21.0 ) (34.0 ) (91.8 ) (113.6 )
Exploration and evaluation expenses (3.6 ) (7.0 ) (13.0 ) (21.2 )
Net loss from operations (61.4 ) (198.3 ) (297.7 ) (198.1 )
Net loss attributable to Yamana Gold equity holders (61.4 ) (188.6 ) (284.6 ) (188.5 )
Net loss from operations, per share - basic and diluted(1) (0.06 ) (0.20 ) (0.30 ) (0.20 )
Cash flow generated from operations after changes in non-cash working capital 114.7   158.5   404.2   484.0  
Cash flow from operations before changes in non-cash working capital(2) 115.8   122.3   566.3   498.0  
Revenue per ounce of gold 1,223   1,269   1,263   1,250  
Revenue per ounce of silver 14.59   16.46   15.37   16.80  
Revenue per pound of copper 2.56   2.36   2.70   2.36  
Average realized gold price per ounce 1,226   1,286   1,267   1,264  
Average realized silver price per ounce 14.59   16.49   15.37   16.83  
Average realized copper price per pound 2.90   3.02   2.99   2.78  
                 
  1. For the three and twelve months ended December 31, 2018, the weighted average numbers of shares outstanding, basic and diluted, was 949,337 thousand and 949,030 thousand, respectively.
  2. Refers to a non-GAAP financial measure or an additional line item or subtotal in financial statements.  Please see the discussion included at the end of this press release under the heading “Non-GAAP Financial Measures and Additional Line Items and Subtotals in Financial Statements”.   Reconciliations for all non-GAAP financial measures are available at www.yamana.com/Q42018 and in Section 11 of the Company’s fourth quarter 2018 Management’s Discussion & Analysis, which has been filed on SEDAR.

Production, Financial and Operating Summary

  Three Months Ending Dec 31st Twelve Months Ending Dec 31st
Gold   2018   2017   2018   2017
Total cost of sales per ounce sold - Yamana Mines $ 999 $ 929 $ 1,008 $ 973
Total cost of sales per ounce sold - Total Yamana $ 1,010 $ 966 $ 1,031 $ 1,023
Total cost of sales per ounce sold – consolidated $ 1,010 $ 980 $ 1,042 $ 1,038
Co-product cash costs per ounce produced - Yamana Mines(1) $ 570 $ 612 $ 614 $ 621
Co-product cash costs per ounce produced - Total Yamana(1) $ 610 $ 660 $ 649 $ 672
All-in sustaining co-product costs per ounce produced - Yamana Mines(1) $ 763 $ 884 $ 816 $ 869
All-in sustaining co-product costs per ounce produced - Total Yamana(1) $ 801 $ 899 $ 843 $ 888
Silver   2018   2017   2018   2017
Total cost of sales per ounce sold $ 14.23 $ 13.26 $ 15.58 $ 13.63
Co-product cash costs per ounce produced(1) $ 7.12 $ 8.86 $ 8.25 $ 10.01
All-in sustaining co-product costs per ounce produced(1) $ 9.57 $ 11.90 $ 10.81 $ 13.48
Copper   2018   2017   2018   2017
Total cost of sales per copper pound sold $ 1.87 $ 1.68 $ 1.80 $ 1.74
Co-product cash costs per pound of copper produced(1) $ 1.50 $ 1.51 $ 1.51 $ 1.54
All-in sustaining co-product costs per pound of copper produced(1) $ 1.86 $ 1.85 $ 1.90 $ 1.89
                 


  Three Months Ending Dec 31st Twelve Months Ending Dec 31st
By-Product Costs   2018   2017   2018   2017
By-product cash costs per gold ounce produced - Yamana Mines(1) $ 420 $ 476 $ 445 $ 490
All-in sustaining by-product costs per gold ounce produced - Yamana Mines(1) $ 657 $ 800 $ 696 $ 788
By-product cash costs per silver ounce produced(1) $ 4.99 $ 7.44 $ 5.90 $ 8.58
All-in sustaining by-product costs per silver ounce produced(1) $ 7.99 $ 11.05 $ 9.11 $ 12.65
                 
  1. Refers to a non-GAAP financial measure or an additional line item or subtotal in financial statements.  Please see the discussion included at the end of this press release under the heading “Non-GAAP Financial Measures and Additional Line Items and Subtotals in Financial Statements”.   Reconciliations for all non-GAAP financial measures are available at www.yamana.com/Q42018 and in Section 11 of the Company’s fourth quarter 2018 Management’s Discussion & Analysis, which has been filed on SEDAR.
  Three Months Ending Dec 31st Twelve Months Ending Dec 31st
Gold Ounces 2018 2017 2018 2017
Chapada 40,841 36,578 121,003 119,852
El Peñón 37,956 39,401 151,893 160,509
Canadian Malartic (50%) 84,732 80,743 348,600 316,731
Jacobina 37,071 34,566 144,695 135,806
Cerro Moro 45,066 92,793
Minera Florida 24,526 23,540 81,635 90,366
Production - Yamana Mines 270,193 214,828 940,619 823,263
Gualcamayo 22,291 44,778 92,285 154,052
Production - Total Yamana 292,484 259,606 1,032,903 977,315
         
  Three Months Ending Dec 31st Twelve Months Ending Dec 31st
Silver Ounces 2018 2017 2018 2017
El Peñón 1,186,789 1,052,423 3,903,961 4,282,339
Cerro Moro 2,077,906 4,119,085
TOTAL 3,264,695 1,052,423 8,023,046 4,282,339
         

For a full discussion of Yamana’s operational and financial results and Mineral Reserve and Mineral Resource estimates please refer to the Company’s fourth quarter 2018 Management’s Discussion & Analysis and Consolidated Financial Statements which have been filed on SEDAR and are also available on the Company’s website.

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MINERAL RESERVE AND MINERAL RESOURCE ESTIMATES
 
Mineral Reserves (Proven and Probable)
The following table sets forth the Mineral Reserve estimates for the Company’s mineral projects as at December 31, 2018.
  Proven Mineral Reserves Probable Mineral
Reserves
Total Proven & Probable
 Gold Tonnes Grade Contained Tonnes Grade Contained Tonnes Grade Contained
  (000's) (g/t) oz. (000's) (000's) (g/t) oz. (000's) (000's) (g/t) oz. (000's)
Alumbrera (12.5%) 8,435 0.39 106 294 0.37 4 8,728 0.39 109
Canadian Malartic (50%) 23,029 0.89 658 55,799 1.18 2,122 78,829 1.10 2,780
Cerro Moro 43 10.57 15 1,766 11.64 661 1,809 11.61 675
Chapada Zones 388,701 0.17 2,103 275,928 0.16 1,381 664,629 0.16 3,484
Suruca Zones 11,454 0.42 153 53,741 0.53 908 65,195 0.51 1,062
Total Chapada 400,155 0.18 2,256 329,669 0.22 2,289 729,824 0.19 4,546
El Peñón Ore 693 5.11 114 3,738 5.38 646 4,431 5.33 760
El Peñón Stockpiles 17 2.41 1 1,029 1.18 39 1,047 1.20 40
Total El Peñón 710 5.04 115 4,768 4.47 685 5,478 4.55 800
Jacobina 18,565 2.32 1,385 9,290 2.39 714 27,855 2.34 2,099
Jeronimo (57%) 6,350 3.91 798 2,331 3.79 284 8,681 3.88 1,082
Minera Florida Ore 690 3.61 80 2,512 3.54 286 3,202 3.56 366
Minera Florida Tailings 0 0.00 0 1,248 0.94 38 1,248 0.94 38
Total Minera Florida 690 3.61 80 3,760 2.68 324 4,449 2.82 404
Total Gold Mineral Reserves 457,977 0.37 5,413 407,677 0.54 7,083 865,653 0.45 12,496
Agua Rica 384,871 0.25 3,080 524,055 0.21 3,479 908,926 0.22 6,559
                   
 Silver Tonnes Grade Contained Tonnes Grade Contained Tonnes Grade Contained
  (000's) (g/t) oz. (000's) (000's) (g/t) oz. (000's) (000's) (g/t) oz. (000's)
Cerro Moro 43 620.7 857 1,766 653.3 37,102 1,809 652.6 37,959
El Peñón Ore 693 166.1 3,700 3,738 171.7 20,630 4,431 170.8 24,330
El Peñón Stockpiles 17 107.2 60 1,029 15.2 502 1,046 16.7 562
Total El Peñón 710 164.7 3,760 4,768 137.9 21,133 5,478 141.3 24,893
Minera Florida Ore 690 28.1 623 2,512 21.9 1,770 3,202 23.2 2,393
Minera Florida Tailings 0 0.0 0 1,248 14.6 584 1,248 14.6 584
Total Minera Florida 690 28.1 623 3,760 19.5 2,353 4,449 20.8 2,976
Total Silver Mineral Reserves 1,443 112.9 5,240 10,294 183.1 60,588 11,736 174.5 65,828
Agua Rica 384,871 3.7 46,176 524,055 3.3 56,070 908,926 3.5 102,246
                   
Copper Tonnes Grade Contained Tonnes Grade Contained Tonnes Grade Contained
  (000's) (%) lbs (mm) (000's)