Silvermet Inc.
TSX VENTURE : SYI

Silvermet Inc.

May 29, 2013 16:50 ET

Silvermet Reports 2013 Q1 Results

TORONTO, ONTARIO--(Marketwired - May 29, 2013) -

THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT AUTHORIZED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES.

Silvermet Inc. ("Silvermet" or the "Company") (TSX VENTURE:SYI) is pleased to announce financial and operating results for Q1, 2013.

Highlights (in US$)

Corporate

  • In Q1, 2013 Silvermet adopted IFRS 11 and as a result changed the accounting for its interest in the Befesa Silvermet Turkey, S.L. ("BST") joint venture from proportionate consolidation to the equity method.
  • At March 31, 2013, cash on hand at the corporate level was $1.6 million.
  • During Q1, 2013, Silvermet repurchased and cancelled 373,000 common shares under its normal course issuer bid at an average price of C$0.09 per share for a total cost of C$34,209.

Joint Venture (expressed at 100%):

  • Sales volume in Dry Metric Tonnes ("DMT") in Q1, 2013 decreased by 32% to 2,919 DMT of zinc concentrate, containing 4.3 million pounds of zinc, compared to the 6.4 million pounds of zinc sold in Q1, 2012, mainly due to higher opening inventory levels in Q1, 2012 and a 32 day shutdown related to kiln refractory brick replacement during Q1, 2013.
  • Production in Q1, 2013 decreased by only 6% to 3,431 DMT zinc concentrate (containing 67% zinc) compared to Q1, 2012 production of 3,657 DMT due to much higher daily productivity rates, despite the 32 day shutdown during Q1, 2013.
  • The cash cost per pound (treatment & transportation costs + direct operating costs / pounds zinc sold) in Q1, 2013 has remained stable at $0.61/lb.
  • EBITDA1 in Q1, 2013 decreased by 37% to $0.68 million compared to $1.08 million in Q1, 2012, reflecting primarily the decrease in sales volume.
  • At March 31, 2013, cash on hand at BST was $5.3 million.
1 EBITDA is a non-IFRS measure, does not have a standardized meaning prescribed by IFRS and may not be comparable to similar terms and measures presented by other issuers. EBITDA comprises earnings before income taxes, interest expense (income) and financing expense (including accretion of liabilities), amortization expense, foreign exchange loss (gain), other expenses including gain on dilution and stock option expense. The Company believes it is appropriate to exclude stock option expense, gain on dilution and accretion of liabilities from EBITDA as a measure of operating performance that excludes non-recurring items.

Expansion:

Progress continues to be made in the Turkish expansion plans:

  • Environmental permits have been received for the planned Adana and Izmir plants.
  • $49 million European Bank for Reconstruction and Development ("EBRD") project financing for the Adana plant (out of a total cost of $70 million) is pending completion of documentation.
  • Various operating and construction agreements are under negotiation; construction of the Adana plant is scheduled to begin in Q3, 2013.
  • Silvermet is in discussions with investors on funding its $10 million share of the equity component of Adana project costs.

About Silvermet:

Silvermet's principal business activity is the recycling of electric arc furnace dust ("EAFD"), a waste product created by steel mills, through a Waelz kiln to produce a zinc concentrate that is sold to smelters throughout the world. The Company owns 49% of Befesa Silvermet Turkey ("BST"), which operates a Waelz kiln facility located in Iskenderun, Turkey.

Additional Information:

Additional information can be accessed at the Company's website www.silvermet.ca or through the Company's public filings at www.sedar.com.

Caution concerning forward-looking statements: The information in this release may contain forward-looking information under applicable securities laws. This forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those implied by the forward-looking information. Factors that may cause actual results to vary include, but are not limited to, inaccurate assumptions concerning the exploration for and development of mineral deposits, political instability, currency fluctuations, unanticipated operational or technical difficulties, changes in laws or regulations, the risks of obtaining necessary licenses and permits, changes in general economic conditions or conditions in the financial markets and the inability to raised additional financing. Readers are cautioned not to place undue reliance on this forward-looking information. The Company does not assume the obligation to revise or update this forward-looking information after the date of this release or to revise such information to reflect the occurrence of future unanticipated events except as may be required under applicable securities laws. The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

"Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release."

Contact Information

  • Silvermet Inc.
    Stephen G. Roman
    Chairman, President & CEO
    1 (416) 203-8336
    info@silvermet.ca

    Silvermet Inc.
    Ian D. Atacan
    Chief Financial Officer
    1 (416) 203-8336
    iatacan@silvermet.ca

    Silvermet Inc.
    8 King St. East, Suite 1700
    Toronto, ON, M5C 1B5, Canada
    1 (416) 203-8336
    www.silvermet.ca