Nevsun Resources Ltd. (TSX:NSU / NYSE MKT:NSU) is pleased to report its financial and operating results for the three and six months ended June 30, 2016. Unless otherwise noted, with the exception of earnings per share and realized price and cost per pound figures, all financial results are in millions of US dollars.
Second quarter 2016 highlights:
- Continued first quartile safety performance at Bisha
- Completed the acquisition of Reservoir Minerals Inc. at a purchase price of $512.5 million
- Completed the acquisition of significant additional exploration licenses in the Bisha District
- Delivered the Bisha Zinc Expansion Project on time and under budget
- Produced 21.6 million pounds of copper at C1 cash costs(1) of $0.92 per payable pound sold
- Total 2016 supergene copper production of 55.8 million pounds at a C1 cash cost(1) of $1.04 per payable pound sold significantly better than guidance
- Sold 30,000 gold equivalent ounces from stockpiles for a YTD sales total of 50,000 gold equivalent ounces
- Generated earnings per share attributable to Nevsun shareholders of $0.04, and $34.9 million in operating income
- Ended period with working capital of $237.9 million, including $240.3 million of cash
- Paid quarterly dividend of $0.04 per share
“The Reservoir transaction is truly transformational and creates immediate diversification to our valuation. We now have two tremendous assets and a strong debt-free balance sheet. Nevsun is positioned as a leading mid-tier base metal company with production and growth. We have hit the ground running in Serbia with drilling already underway and ambitious plans to move the Timok Copper-Gold Project to pre-feasibility no later than the end of 2017,” commented Cliff Davis, CEO of Nevsun.
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Cliff Davis commented on Bisha,
“Bisha continues to produce cash for its shareholders. We exceeded our guidance on supergene production and cash cost expectations. Our cost-cutting efforts have been sustained. Strong gold and silver prices from our Direct Ship Ore stockpiled material also helped the bottom line. Pre-commercial production is underway with our first sale of zinc concentrate likely to occur in August. The zinc concentrate market remains very tight and we are very pleased to see zinc prices in excess of $1.00 per pound.”
Cliff Davis went on to say,
“Our confidence operating in Eritrea, supported by the positive exploration drill results, has lead us to make an additional investment in Eritrea. This twenty-fold increase in our exploration licensed areas, with more advantageous relinquishment terms, was acquired in exchange for a portion of the amount receivable from our partner, the Eritrean National Mining Corporation.”