Avion Gold Announces Second Quarter 2010 Financial Results / Continues to Achieve Positive Operating Cash Flow
TORONTO, ONTARIO -- (Marketwire) -- 08/26/10 -- Avion Gold Corporation (TSX VENTURE: AVR)(PINK SHEETS: AVGCF)(OTCQX: AVGCF) ("Avion" or the "Company") today announces its financial results for the 2nd quarter of 2010.
Complete interim financial statements and related Management's Discussion and Analysis are filed under the Company's profile on www.sedar.com. All amounts are in United States dollars unless otherwise indicated. The key facts are summarized below.
-- During the 2nd quarter, the Company produced 22,222 ounces at a cash
cost per ounce of US$ 596. The Company is forecasting costs of US$ 550
to US$ 600 per oz per quarter for the remaining two quarters in the
year.
-- During the 2nd quarter, the Company sold 21,654 ounces of gold at an
average realized price of US$ 1,197 per ounce, which was higher than the
average London fix of US$ 1,196 over the same period.
-- The Company reported a net loss of $208,350 ($0.00 per share) for the
quarter ended June 30, 2010 which includes a stock-based compensation
expense of $3,860,973 compared to a net loss of $580,694 ($0.00 per
share) for the quarter ended June 30, 2009 which includes a stock-based
compensation expense of $845,480.
-- Gold revenue for the second quarter ended June 30, 2010 was $25.9
million compared to $5.6 million for the comparable quarter last year.
-- Operating cash flow before the working capital adjustment for the second
quarter ended June 30, 2010 was $6.7 million.
-- Net working capital as at June 30, 2010 was $39.9 million (including
cash and cash equivalents of $ 31.2 million).
Commenting on the Q2 2010 results, Avion's President and CEO, Mr. John Begeman stated: "Second quarter production significantly increased over the previous quarter. The grade from Segala was as expected and was supplemented with some tonnage from the Tabakoto pit. Production in Q3 should be as expected and our guidance remains to produce between 75,000 and 85,000 ounces for 2010. Avion is cash flow positive and is in a strong financial position to proceed with our expansion plans."
Avion is a Canadian-based gold mining company focused in West Africa that holds 80% of the Tabakoto and Segala gold projects in Mali. Gold production commenced at these projects in 2009 with just over 51,000 ounces produced. 2010 production is estimated at 75,000 to 85,000 ounces of gold. Production sustainability is supported and enhanced by an aggressive 2010 drill program over an approximately 600 km2 exploration package that both surrounds and is near to the Company's existing mine infrastructure. Additionally, the 1,670 km2 Hounde exploration property in Burkina Faso, that Avion is in the process of acquiring (see News Release dated July 5, 2010) is returning good results from an ongoing exploration program. These properties are the subject of an approximate US$ 12 million dollar, 60,000 metre plus, drill-focused exploration program in 2010, which management expects, based on results to date, to add new resources and future opportunities for Avion. Avion continues to progress towards its longer term goal of 200,000 ounces of gold per year and is preparing to mine underground at the Segala and Tabakoto deposits. Avion has a highly skilled management team, with a focus on growth and consolidation within West Africa.
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