TSX:
CGG
HKSE:
2099
last:
2.08 (+0.00)
last:
12.76 (+0.08)
vol:
884,674
vol:
1,398,000

China Gold International Reports 2016 Second Quarter and First Half Financial Results and 2016 Annual Outlook.

VANCOUVER, August 12, 2016 - China Gold International Resources Corp. Ltd. (TSX: CGG; HKEx: 2099) (the “Company” or “China Gold International Resources”) reports on the Company’s financial and operational results for the three months (“Q2”, “quarter” or “second quarter 2016) and six months (“first half” or “six months 2016) ended June 30, 2016.  This news release should be read in conjunction with the Company’s Financial Statements, Notes to the Financial Statements and Management’s Discussion and Analysis.

Selected Production and Financial Highlights: Q2 2016 Compared to Q2 2015

  • Revenue decreased by 16% to US$69.9 million from US$83.6 million for the same period in 2015.
  • Mine operating earnings decreased by 42% to US$11.7 million from US$20.3 million.
  • Net profit/loss after income taxes decreased to net loss of US$7.4 million from net profit of US$10.6 million for the same period in 2015, primarily due to foreign exchange loss of US$6.0 million during the current period.
  • Gold production from the CSH Mine decreased by 2% to 48,867 ounces from 49,783 ounces for the same period in 2015.  The decrease in gold production is attributed to lower volumes and grades of ore mined during the current quarter.
  • The cash production cost, and total production cost of gold for the three months ended June 30, 2016 both increased compared with the same period in 2015.  The increase is due to higher waste rock removal costs due to higher stripping ratio during the current period and lower grade of ore:
CSH Mine Three months ended June 30,
  2016 2015
Total production cost (US$ per ounce) 1,042 841
Cash production cost (US$ per ounce) 695 642
*   Non-IFRS measure.
  • Copper production from the Jiama Mine increased by 2% from 4,923 tonnes (approximately 10.85 million pounds) in 2015 compared to 5,014 tonnes (approximately 11.05 million pounds) for the same period in 2016. 
  • The cash production cost, and total production cost of copper for the three months ended June 30, 2016 both decreased compared with the same period in 2015.  The decreases are primarily due to a 24% increase in sales volumes of copper during the three months ended June 30, 2016: 
Jiama Mine Three months ended June 30,
  2016 2015
Total production cost* (US$) of copper per pound after by-products credits 1.36 1.99
Cash production cost** (US$) of copper per pound after by-products credits 0.94 1.43
*   Production costs include expenditures incurred at the mine sites for the activities related to production including mining,      processing, mine site G&A and royalties etc.
**  Non-IFRS measure.

Selected Production and Financial Highlights: First Half 2016 Compared to First Half 2015

  • Revenues decreased by 16% to US$135.5 million from US$161.0 million for the same period in 2015.
  • Net profit/loss after income taxes decreased to net loss of US$10.9 million from net profit of US$16.8 million for the same period in 2015, primarily due to foreign exchange loss of US$4.8 million in addition to US$3.8 million value impairment of Available-for-sale securities during the current six month period.
  • Gold production from the CSH Mine decreased by 6% to 85,570 ounces from 90,817 ounces for the same period in 2015.
  • Copper production from the Jiama Mine increased by 1% to 9,120 tonnes (approximately 20.1 million pounds) from 9,012 tonnes (approximately 19.9 million pounds) for the same period in 2015.

Mr. Bing Liu, the CEO and Executive Director of the Company, stated, "I am very pleased with the performance of our Company and our team. Despite challenging market conditions, the Company is undertaking a further detailed review of its existing projects to reduce costs.  Initiatives are being undertaken to continue the Company’s already taken steps to streamline its operations and will continue to do so.  It is the goal of our entire team to add value to our shareholders and to the communities where we operate."

2016 Outlook

  • Projected gold production of 235,000 ounces in 2016.
  • Projected copper production of approximately 38.6 million pounds in 2016.
  • The Jiama Mine’s processing plant Phase II expansion is being executed in two stages.  Stage I has been completed and is currently eliminating defects.  The commissioning (Start-Up) is scheduled for December 1, 2016. The throughput capacity will be 28,000 tpd, up from the previous capacity of 6,000 tpd after completing the commissioning process. Construction of Stage II of the project is under way and is expected to be completed in the second half of 2016. The total processing capacity will increase to 50,000 tpd upon completion of the two-stage expansion program.
  • The Company will continue to leverage the technical and operating experience of the Company’s controlling shareholder, China National Gold Group Corporation (“CNG”), to improve operations at its mines. In addition, the Company continues to focus its efforts on increasing production while minimizing costs at both mines.
  • To fulfill its growth strategy, the Company is continuously working with CNG and other interested parties to identify potential international mining acquisition opportunities, namely projects outside of China, which either are in production or can be readily and quickly brought into production with the possibility of further expansion through continued exploration.

Analysts, investors, media and general public are encouraged to visit the Company’s website at www.chinagoldintl.com, The Stock Exchange of Hong Kong Limited’s website at www.hkex.com.hk or SEDAR at www.sedar.com to view the complete set of the financial statements and MD&A or contact the Company with any questions.

About China Gold International Resources

China Gold International Resources Corp. Ltd. is based in Vancouver, BC, Canada and operates both profitable and growing mines, the CSH Gold Mine in Inner Mongolia, and the Jiama Copper-Polymetallic Mine in Tibet Autonomous Region of the People’s Republic of China. The Company’s objective is to continue to build shareholder value by growing production at its current mining operations, expanding its resource base, and aggressively acquiring and developing new projects internationally. The Company is listed on the Toronto Stock Exchange (TSX: CGG) and the Main Board of The Stock Exchange of Hong Kong Limited (HKEx: 2099).

For further information on China Gold International Resources Corp. Ltd., please refer to its SEDAR profile at www.sedar.com or contact Tel: 604-609-0598, Email: info@chinagoldintl.com, Website: www.chinagoldintl.com.

Cautionary Note About Forward-Looking Statements

Certain information regarding China Gold International Resources contained herein may constitute forward-looking statements within the meaning of applicable securities laws. Forward-looking statements may include estimates, plans, expectations, opinions, forecasts, projections, guidance or other statements that are not statements of fact. Although China Gold International Resources believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. China Gold International Resources cautions that actual performance will be affected by a number of factors, most of which are beyond its control, and that future events and results may vary substantially from what China Gold International Resources currently foresees. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration results, continued availability of capital and financing and general economic, market or business conditions. The forward-looking statements are expressly qualified in their entirety by this cautionary statement. The information contained herein is stated as of the current date and subject to change after that date.