China Gold International Resources Corp. Ltd.
TSX : CGG
HKSE : 2099

China Gold International Resources Corp. Ltd.

November 11, 2016 09:00 ET

China Gold International Reports 2016 Third Quarter Results

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Nov. 11, 2016) - China Gold International Resources Corp. Ltd. (TSX:CGG) (HKSE:2099) (the "Company" or "China Gold International Resources") reports its financial and operational results for the three months ("Q3", "quarter" or "third quarter 2016") ended September 30, 2016.

Selected Highlights: Q3 of 2016 Compared to Q3 of 2015

  • Consolidated revenues of US$109.6 million for the third quarter of 2016 increased by US$9.7 million or 10%, from US$99.9 million for the same time period in 2015.

  • Jiama Mine's revenues of US$31.2 million for the third quarter of 2016 compared to US$37.5 million for the same time period in 2015.

  • Copper production from the Jiama Mine increased by 23% to 4,836 tonnes from 3,934 tonnes for the same period in 2015.

  • CSH Mine experienced higher revenues of US$78.4 million for the third quarter of 2016 versus US$62.4 million for the same time period in 2015 due to a 5% increase in gold sales volume. Gold sold by the CSH Mine was 59,610 ounces for the third quarter of 2016, compared to 56,741 ounces for the same period in 2015.

  • Gold production at the CSH Mine decreased to 46,654 ounces for the third quarter of 2016 from 57,981 ounces for the same period in 2015. The decreased production volumes are attributed to lower grades of ore mined.

  • Consolidated mine operating earnings of US$23.9 million in Q3 of 2016 increased by 39% or US$6.7 million, from US$17.2 million for the same time period in 2015. The increase in mine operating earnings as a percentage of revenue can be attributed to a 20% increase in the realized average price of gold per ounce.

  • Consolidated general and administrative expenses of US$5.9 million in Q3 of 2016 increased by US$0.6 million, from US$5.3 million for the same time period in 2015.
  • Consolidated income from operations of US$17.9 million in Q3 of 2016 increased by US$6.1 million, from US$11.8 million for the same time period in 2015.

  • Foreign exchange loss decreased to a loss of US$2.5 million for the three months ended September 30, 2016 from a loss of US$8.6 million for the same 2015 period. The 2016 loss is related to the revaluation of monetary items held in Chinese RMB and Hong Kong Dollars, which was based on changes in the RMB/HKD/USD exchange rates.

  • Net income of the Company was US$7.7 million for the third quarter of 2016, compared to a net loss of US$5.2 million for the same time period in 2015.

  • At the CSH Mine, both the cash production cost and total production cost of gold for the three months ended September 30, 2016 increased compared with the same period in 2015 due to higher waste rock removal costs as a result of the higher stripping ratio during the current quarter and the lower grade of ore.

  • At the Jiama Mine, the cash production cost of copper per pound decreased by 15% and total production cost of copper per pound decreased by 9% for the three months ended September 30, 2016 compared to the same period in 2015. Cash production cost of copper per pound after by-products credits decreased by 41% due to higher copper grade and higher volume of by product gold sold in copper concentrate during the current period.
CSH Mine Three months ended
September 30,
2016 2015
US$ US$
Per ounce
US$ US$
Per ounce
Total Production costs 62,056,034 1,041 49,599,389 874
Adjustments (15,674,662) (263) (9,871,894) (174)
Total cash production costs 46,381,372 778 39,727,495 700
Jiama Mine Three months ended
September 30,
2016 2015
US$ US$
Per pound
US$ US$
Per pound
Total Production costs 27,840,757 2.45 38,116,793 2.69
Adjustments (4,531,109) (0.40) (3,873,060) (0.28)
Total cash production costs 23,309,648 2.05 34,243,733 2.41

Production costs above include expenditures incurred on the mine sites for activities related to production. The adjustments above include depreciation and depletion, amortization of intangible assets and selling expenses included in total production costs.

Recent Developments and Future Outlook

  • The Jiama Mine's Phase II expansion consists of two series, with each series having a mining and mineral processing capacity of 22,000 tpd. The Phase II series I construction is now completed. The commissioning will be started in December 2016. It is expected that the output of Series I will be ramped up to its full capacity to 22,000 tpd around July 2017. With Phase II series I in production, the total nameplate capacity will be increased from the current 6,000 tpd to 28,000 tpd.

  • Projected gold production of 235,000 ounces in 2016.

  • Projected copper production of approximately 38.6 million pounds in 2016.

  • 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.

For a detailed look at the complete set of the financial statements and MD&A analysts, investors, media and general public are encouraged to visit the Company's website at www.chinagoldintl.com/investors/financials, SEDAR at www.sedar.com or The Stock Exchange of Hong Kong Limited at www.hkex.com.hk 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 (HKSE:2099).

For further information on China Gold International Resources Corp. Ltd., please refer to its SEDAR profile at www.sedar.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.

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