Troy Resources NL

Troy Resources NL

August 27, 2009 00:01 ET

Troy Announces a Profit of A$16.7 Million and Builds the Foundation for Future Growth

PERTH, WESTERN AUSTRALIA--(Marketwire - Aug. 27, 2009) - Troy Resources NL (TSX:TRY)(ASX:TRY) -



- Net profit after tax of A$16.7 million

- Pays 10th consecutive fully-franked cash dividend. FY2009 4 cents per share

- 53% increase in gold production to 61,832 ounces

- Acquired the Casposo gold/silver deposit in Argentina

- 32% increase in the Casposo Mineral Resource

- Commenced production from the high grade Mamao underground mine at the Andorinhas operation in Brazil

- The Sandstone mine which was due to close in February 2009, will now continue production through at least July 2010 with the mining of additional ore (30,000oz) from a cut back to the pit at the Lord Nelson deposit

- Discovery of high-grade mineralisation at the Two Mile Hill prospect at Sandstone, Western Australia including an intercept of 13.7m at 25.98g/t Au

- 96% increase in gold Reserves to 539,500oz, a 60% increase in Measured and Indicated gold Resources to 893,400oz and a 240% increase in Indicated Resources to 648,400oz

- Maiden silver Reserves of 6.7 million ounces and silver Indicated Resources of 15.4 million ounces

- Cash reserves of over A$35 million

- Unhedged gold and silver position

- Debt free

Growing junior gold producer, Troy Resources NL today announced a profit of $16.7m for the financial year ended 30 June 2009. This result compares to a loss $17.6m in FY 2008.

The profit for the year came from gold production of 61,832 oz and gold sales revenue of $75.4 million (FY2008: 40,318 oz and $39.7m). The result included the first full year of production from the Company's new underground gold mine at Andorinhas in Brazil.

Commenting on the results Troy's CEO, Paul Benson, said: "This has been a very good year for Troy. Last year we said FY2008 had been a year of transition as we positioned the Company for growth. In FY2009 we have laid strong foundations and started delivering on that growth.

"We saw a 53% increase in gold production compared to last financial year and have reported a profit of A$16.7 million. We have rewarded shareholders with a 33% increase in our dividend to 4 Australian cents per share which represented a dividend yield of 2.3%. It is worth noting that this is Troy's 10th consecutive, fully-franked cash dividend.

"Although the results for the year were impressive, it's the foundation that we have laid for the Company's future growth which has been most pleasing. With the acquisition of the Casposo project in Argentina, Troy now has the longest forecast production profile in the Company's history. The Casposo acquisition and exploration at Sandstone have led to significant increases in gold Reserves and Resources, again giving us the largest gold and silver inventory in the Company's history.

"We have started development of the Casposo project and expect it to be in production in the September quarter of 2010. Casposo will be a low cost gold mine that will help lift the Company's production well above 100,000 ounces per year.

"We see the year ahead as just as exciting with excellent potential to add further to our Reserve and Resource base. The high grade discovery at the Two Mile Hill prospect at Sandstone will be tested before the end of the calendar year. Similarly we will be testing targets at Andorinhas in Brazil and surface targets at Casposo.

"Troy is excellently placed to achieve its vision of becoming a profitable mid-tier gold producer," Mr Benson said.


At the end of July 2009, Troy had cash reserves of over $35 million, with no debt and no forward sales in place.

Notably, Troy's profit result for FY2009 was achieved after allowing $7.2 million for exploration expenditure (FY2008: $11m) and $10.5 million for depreciation and amortization (FY2008: $5.1m). Troy has an aggressive exploration program aimed at increasing reserves and resources and generally this expenditure is expensed in the year it is incurred.


In recognition of the excellent potential to continue growing Troy's gold resources the Board increased the final annual fully-franked dividend by 33% to 4 Australian cents per share (FY2008: 3.0 cents). This represented a yield of 2.3% based on the share price on August 7, 2009. The record date for entitlement to the dividend was August 21 and it will be paid on September 4, 2009.


During the year mining was completed in the Lagoa Seca open pit at Andorinhas with production now coming from the higher grade Mamao underground mine.

At Sandstone low grade stockpiles were processed for the majority of the year. A new cut back in the Lord Nelson pit will provide mill feed through the 2010 financial year. Drilling of the Two Mile Hill prospect led to the discovery of high grade mineralisation which will be drill tested before the end of the 2009 calendar year.

In May 2009 Troy acquired the Casposo deposit in Argentina from Intrepid Mines paying US$20 million from cash reserves. An additional US$2 million is payable on the 6th month anniversary of first production. Construction will commence in the September quarter of 2009 and first production is expected in the September quarter of 2010.

To view a full copy of the Appendix 4E - Preliminary Financial Statements for the year ended 30 June 2009, please click on the following link:


Information of a scientific or technical nature in this news release was prepared under the supervision of Peter J. Doyle, Vice President Exploration and Business Development of Troy, a "qualified person" under National Instrument 43-101 - "Standards of Disclosure for Mineral Projects", a member of the Australasian Institute of Mining and Metallurgy. Mr. Doyle has sufficient experience, which is relevant to the style of mineralization and type of deposit under consideration, and to the activity he is undertaking, to qualify as a "competent person" as defined in the 2004 edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr. Doyle has reviewed and approved the information contained in this report. For further information regarding the Company's projects in Brazil, Australia and Argentina, including a description of Troy's quality assurance program, quality control measures, the geology, samples collection and testing procedures in respect of the Company's projects please refer to the technical reports filed which are available under the Company's profile at or on the company's website.

This news release contains "forward-looking statements" and "forward-looking information", based on assumptions and judgements of management regarding future events and results. Such "forward-looking statements" and "forward-looking information which may include, but are not limited to statements with respect to the expected development of the Casposo and Two Mile Hill projects. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects", "is expected", "is expecting", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "believes", or variations (including negative variations) of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might", or "will" be taken, occur or be achieved. The purpose of forward-looking information is to provide the reader with information about management's expectations and plans. Readers are cautioned that forward-looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Troy and/or its subsidiaries to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. Such factors include, among others, future prices of gold and silver, the actual results of current production, development and/or exploration activities, changes in project parameters as plans continue to be refined, variations in ore grade or recovery rates, plant and/or equipment failure, delays in obtaining governmental approvals or in the commencement of operations, the possibility of cost overruns, as well as those factors disclosed in the Company's filed documents. There can be no assurance that the development of the Casposo and Two Mile Hill projects will proceed as planned or that they will be successfully completed within expected time limits and budgets or that, when completed, the mines will operate as anticipated or that expected production levels will be achieved.


Troy Resources (TSX:TRY)(ASX:TRY) is a dividend-paying junior gold producer, with a clear growth strategy. The Company has two producing gold operations; at Sandstone in Western Australia and the Andorinhas Mine in Para State, Brazil and a gold silver development project, Casposo, in San Juan province, Argentina.

Troy has an experienced Board and management team with a portfolio of successful, fast-track mine development and low-cost operations.

Troy has an annual exploration budget of $5 million and a proven track record in exploration discoveries and strategic acquisitions.

Troy is currently focused on developing its Casposo Project, which it acquired in May 2009. With the acquisition and development of Casposo, Troy is entering a renewed growth phase which will again lift the Company's annual gold production above 100,000 ounces of gold per annum.

The Company maintains a robust balance sheet, and its current assets are forecast to continue to generate strong cash flow. Troy's gold production is unhedged; allowing its shareholders access to the full benefit of current and future gold price upside.

With the recent Casposo acquisition, Troy is positioned to continue its path of strong growth and profitable operations and is well on track to achieve its vision of becoming a highly profitable mid-tier gold producer with a portfolio of quality long-life assets.

Troy is a responsible corporate citizen, committed to the best practice of health and safety, environmental stewardship and social responsibility.

To view the Project Locations maps please click on the following link:

ABN 33 006 243 750

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