Golden Minerals Announces First Quarter 2013 Results

GOLDEN, Colo., May 8, 2013 /PRNewswire/ -- Golden Minerals Company ("Golden Minerals" or the "Company") (NYSE MKT: AUMN) (TSX: AUM) announces results for the quarter ending March 31, 2013.

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Financial Results

For the first quarter 2013, Golden Minerals recorded revenue of $5.8 million and a net loss of $6.3 million, as compared to revenue of $6.4 million and a net loss of $10.1 million in the first quarter 2012. The decrease in revenue was driven by lower realized silver and gold prices and lower metals sold.  Loss from operations in the first quarter 2013 decreased to $9.5 million from $12.7 million in the first quarter 2012, primarily attributable to decreases in exploration, project and administrative expenses, as well as an increase in other operating income due primarily to a gain on the sale of various exploration properties in Peru.

The Company's cash and cash equivalents balance on March 31, 2013 was $36.2 million as compared to $44.4 million on December 31, 2012.  The decrease is due primarily to $3.1 million in Velardena Operations capital and development expenditures, $3.0 million in operating losses at the Velardena Operations, $1.5 million in exploration expenditures, $1.9 million on general and administrative activities, $1.1 million on the El Quevar project, and $1.6 million in additional working capital primarily related to a decrease in accounts payable and an increase in the value added tax receivable, offset by total net proceeds of $3.8 million from the sale of non-strategic exploration property interests in Peru.

Operating Results

During the first quarter 2013 the Company produced products from the Velardena Operations in Mexico containing 150,992 payable ounces of silver, 1,309 payable ounces of gold and 216,417 payable ounces of silver equivalent, compared to products produced during the first quarter of 2012 containing 110,227 payable ounces of silver, 1,722 payable ounces of gold and 196,327 payable ounces of silver equivalent. Silver equivalent ounces are calculated at a ratio of 50:1 silver to gold.

First quarter 2013 production was in line with the Company's 2013 operating plan. Combined grades feeding both plants increased year over year by 10 percent for gold and 47 percent for silver. The decrease in gold production was primarily due to reduced gold recoveries from material mined from new areas with an apparent change to metallurgy and a decrease in the percentage of oxide ores which achieve favorable recoveries in the leach circuit. The Company continues with the testing of both short and longer term methods to improve gold recoveries and has engaged a well known expert to assist in these efforts.  

The table below sets forth the operating statistics of the Velardena Operations for the first quarter of 2013 and 2012:

Outlook

As previously communicated, the Company currently expects to produce between 900,000 and one million ounces of payable silver equivalent in 2013. The Company continues to expect completion of the San Mateo ramp in the third quarter 2013, and that production in the third and fourth quarters of 2013 will exceed first quarter production as broken material inventories are replenished in the mine and additional development work opens new stopes for production. Due to the depletion of broken ore resulting from the explosives permit suspension that ended April 10, 2013, the Company expects second quarter production and metals sold to be lower than the first quarter. Given the recent decline in prices for gold and silver the Company is now assuming prices for silver of $25 per ounce and for gold of $1,500 per ounce for the remainder of 2013. Taking into account lower forecast prices and the disruption in production caused by the temporary suspension of the explosives permit, the Company anticipates ending 2013 with a cash and cash equivalents balance of approximately $18.0 million.

Additional information regarding first quarter financial results may be found in the Company's 10-Q Quarterly Report which is available on the Golden Minerals website at www.goldenminerals.com.

About Golden Minerals

Golden Minerals is a Delaware corporation based in Golden, Colorado, primarily engaged in the ramp-up and expansion of existing production at the Velardena Operations in Mexico and advancement of the evaluation stage El Quevar project in Argentina.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, and applicable Canadian securities laws, including statements regarding of the timing of anticipated production ramp-up at the Velardena Operations and anticipated total silver equivalent production in 2013; expected lower production in the second quarter 2013; the timing of completion of the San Mateo ramp;  anticipated year-end 2013 cash and cash equivalents. These statements are subject to risks and uncertainties, including unexpected events at the Velardena Operations, including delays or problems in mine development and plant optimization; operational changes or problems; variations in ore grade and relative amounts, grades and metallurgical characteristics of oxide and sulfide ores; delays or failure in receiving required board or government approvals or permits; technical, permitting, mining, metallurgical or processing issues; failure to achieve anticipated production and improvements in head grades, recoveries and concentrate production and quality at the Velardena Operations; delays in or failure to realize anticipated benefits of plant optimization efforts; failure to realize anticipated production or increases in production from the anticipated increase in mine development and the commencement of mining in new stopes; loss of and inability to adequately replace skilled mining and management personnel; interpretations and changes in interpretations of geologic information; volatility or other changes in the U.S. and Canadian securities markets; availability and cost of materials, supplies and electrical power required for mining operations and exploration; fluctuations in silver, gold, zinc and lead prices, costs and general economic conditions; changes in political conditions, tax, environmental and other laws; and diminution of physical safety of employees in Mexico, and other conditions in the countries in which the Company operates.  Additional risks relating to Golden Minerals Company may be found in the periodic and current reports filed with the Securities Exchange Commission by Golden Minerals Company, including the Annual Report on Form 10-K for the year ended December 31, 2012.

Golden Minerals Company
Karen Winkler
Director of Investor Relations
(303) 839-5060
[email protected]

SOURCE Golden Minerals Company