`Avino Silver´(ASM.V) besser als `Mines Management´(MGN)? (Seite 43)

[nicolani]

http://web.tmxmoney.com/article.php?newsid=4811024013209373&…

[blue-moon]

Gute Nachrichten

Aktuell:

Avino fertigt neue Ressourcenschätzung für das Konzessionsgebiet Bralorne in British Columbia (Kanada) an!

- damit erhöht man den Wert der Mine und hat gleichzeitig die nötigen Daten um die Vorwärtsstrategie weiter auszubauen und umzusetzen.

Quelle: IRW-News / Comdirect vom 24.10.16

[blue-moon]

Antwort auf Beitrag Nr.: 53.075.715 von Fantomas96 am 17.08.16 09:13:03

Hallo - ist still um Dich - bist noch dabei?

[blue-moon]

Ohne Avino Silver fehlte was - bin seit Freitag wieder im Boot und setze mal darauf, dass Gold und Silber bis Ende des Jahres kräftig steigt.

[Der_Aktienfuchs]

Hier bleibe ich ganz entspannt. Habe einen Durchschnittkurs von 1,05 USD. Bei 2,50 USD die Hälfte verkauft, und wollte nun unter 2 USD wieder zurück kaufen. Die Chance gestern leider verpasst. Ging ja dann intraday wieder gut nach oben.

Und heute sind Silber und Gold auch im Plus. Muss also weiter warten

[blue-moon]

Antwort auf Beitrag Nr.: 53.075.715 von Fantomas96 am 17.08.16 09:13:03

Weg bin ich nicht - bin nur nicht dabei

Meine Kurs Ansage von 5 $ galt und gilt unter der Voraussetzung, dass Silber über mindestens 22,- $ steigt und auch dort bleibt. Dazu entsprechende positive Nachrichten vom MM.
Da beide Punkte nicht eingetroffen sind habe ich die Bühne verlassen.

Das ist doch legitim - wobei ich mir gut vorstellen kann wieder zu kommen sobald die Aktie die von mir vorgegebenen Parameter erfüllt. Ab und zu Gewinne sicher stellen hat noch nie geschadet.

[Fantomas96]

Antwort auf Beitrag Nr.: 53.075.715 von Fantomas96 am 17.08.16 09:13:03

Avino Q2 Earnings Conference Call

Avino Silver & Gold Mines Ltd. (NYSEMKT:ASM)

Q2 2016 Results Earnings Conference Call

August 16, 2016, 11:00 AM ET

Executives

Charles Daley - Corporate Communications

David Wolfin - President and Chief Executive Officer

Malcolm Davidson - Chief Financial Officer

Jasman Yee - Director

Analysts

Rob Chang - Cantor Fitzgerald

Bhakti Pavani - Euro Pacific Capital Inc.

Heiko Ihle - Rodman & Renshaw

Michael Heim - Noble Financial Group, Inc.

Todd Davis - Private Investor

David Sheridan - World Over Capital

Operator

Thank you for standing by. This is the conference operator. Welcome to the Avino Silver & Gold Mines Q2 2016 earnings conference call. As a reminder, all participants are in a listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. [Operator Instructions]

I would now like to turn the conference over to Charles Daley, Corporate Communications. Please go ahead.

Charles Daley

Thank you, operator. Good morning, everyone, and welcome to the Avino Silver & Gold Mines second quarter 2016 financial results conference call. On the call today, we have the company's President and CEO, David Wolfin, as well as our Chief Financial Officer, Malcolm Davidson, and one of our directors, Mr. Jasman Yee.

Before we get started, I'm required to remind you that certain statements on this call will include forward-looking information within the meaning of applicable securities laws. These may include statements regarding Avino’s anticipated performance in 2016 and future years including revenue and cost forecasts, silver and gold production, grades and recoveries, and the timing of expenditures required to develop new mines in mineralized zones. The company does not intend to, and does not assume any obligation to, update such forward-looking statements or information other than as required by applicable law.

Thank you. With that, I will now turn the call over to Avino’s President and CEO, Mr. David Wolfin.

David Wolfin

Thanks, Charles. And welcome everybody. I’d like to thank you all for joining us here today. During this call, I’ll cover the highlights of this morning's news release and our financial and operating performance during the second quarter of 2016 compared to 2015. I'll then open up the call for Q&A to address any questions you may have.

The second quarter of 2016 was a very significant period for the company, primarily because commercial production was declared at the Avino Mine. In past quarters, the sale of Avino Mine concentrate was classified as a recovery of exploration and evaluation expenses rather than revenue.

Accordingly, revenue from mining operations for the quarter was CAD 11.9 million compared to CAD 5.9 million during the comparative quarter last year. Although significantly higher than last year, the figure was somewhat lower due to required maintenance of the ball mill on Mill Circuit 3 as well as lower grade material from San Gonzalo stockpile being processed using Mill Circuit 2, which together contributed to a 23% decrease in silver equivalent production. We're expecting a stronger quarter of production in Q3, which should add further to our topline revenue figure.

Moving on, mine operating income was CAD 3.2 million compared to CAD 2.4 million last year. The increase was also due to revenue received from the sale of Avino Mine concentrate. Our realized silver price increased by 6% from US$16.10 to US$16.58 per ounce sold. Our realized gold price increased by 7% from US$1,179 to US$1,259 per ounce sold compared to the second quarter last year.

Earnings for the quarter before income taxes was CAD 1.5 million compared to CAD 1.2 million in Q2 last year. Net loss for the quarter after taxes was CAD 450,000 compared to net income of CAD 361,000 in Q2 last year, resulting in a loss of CAD 0.01 per share, down from a positive earnings of CAD 0.01 per share last year. The loss was due to ongoing development expenses at the Avino Mine, which drove down margins, the decreased production from San Gonzalo, as discussed earlier, as well as our income tax expense which we are working to reduce.

Our consolidated all-in sustaining cash cost for the quarter was CAD 14.51 or US$11.27 compared to CAD 11.72 or US$9.53 in Q2 2015. Costs were higher for the same operational reasons that brought down our net income.

Our cash and cash equivalents increased by 42% from December 31, 2015 to CAD 10.7 million. During and subsequent to the quarter, Avino has been strategically using its ATM through Cantor Fitzgerald to raise capital to advance its projects. We continue to maintain a strong balance sheet, which keeps us well positioned for expansion and new opportunities.

Now on to operations. As I mentioned earlier, this quarter, our silver equivalent production decreased by 23%. The decrease was a result of required maintenance on Mill Circuit 3 as well as lower grade development material from San Gonzalo stockpile being processed using Mill Circuit 2.

Broken down, our silver production was down by 16% to 381,000 ounces. Gold production was down by 20% to 1,509 ounces and our copper production was down 16% to 1.1 million pounds.

On a more positive note, our expansion plans are well underway. Last week, our contractor broke ground on a new tailings storage facility. Once completed, the current tailings storage facility will be decommissioned, allowing us to move forward with the recommendations made in the 2013 Tetra Tech PEA on the oxide tailings.

To get a head start on the recommendations, we recently completed drilling on the exposed oxide bench. Results from the drill program will be included in a new resource estimate to be released later this summer.

At Bralorne, we continued to develop a strategic operating plan for profitable production. Our new mine plan includes changing the mining method to long-haul mining, which is considered safer and less labor-intensive than previous trial mining methods and would support production levels up to 300 tonnes per day. New mining equipment is being acquired to replace older mining equipment and to further mechanize for long-haul mining. Engineering is in progress to expand the mill and to upgrade the surface infrastructure from 100 to 300 tonnes per day. Expansion work for the mill and infrastructure is expected to start in the latter part of 2016.

Now, let's move on to the outlook for the rest of 2016. Management remains focused on the following key objectives: Maintain and improve profitable mining operations, while managing operating costs and achieving efficiencies; advance the Bralorne project towards profitable production; explore regional targets on the Avino property, followed by other properties in our portfolio; assess the potential for processing the oxide tailings resource from previous milling operations; and identify and evaluate potential projects for acquisition.

We’d now like to move the call to question and answer portion.

Question-and-Answer Session

Operator

[Operator Instructions] Thank you. The first question comes from Rob Chang, Cantor Fitzgerald. Please go ahead.

Rob Chang

Good morning, gentlemen. A couple of questions. First off, with respect to the taxes, it seems quite high. Can you expand on how it got to that level and just more details on that please?

Malcolm Davidson

Hi, Rob. It’s Malcom here.

Rob Chang

Hi, guys.

Malcolm Davidson

So our total income taxes is, obviously, divided into current and deferred. So the current income taxes are just simply the tax that we’re paying on taxable income earned in Mexico. The deferred income tax is a little bit more complicated. A lot it’s driven by using the US dollar as our functional currency in Mexico, so we’re translating from pesos to US dollars and then to Canadian dollars. And, ultimately, what’s happening is we’re having a large – of the CAD 1 million deferred income tax expense in the current quarter, a large portion of it is driven by foreign exchange. So it is unusually high. It’s a non-cash number. With that being said, we’ve considered a few things to help mitigate this expense and one of them is reporting in US dollars as the reporting currency versus Canadian, although that can introduce other complications. But it’s really from translating from the peso through to the Canadian dollar of our Mexican subsidiary.

Rob Chang

Would that qualify as an adjusted – or something that you could list as an adjusted net earnings and have that netted out?

Malcolm Davidson

That’s a good question. I have to get back to you on that.

Rob Chang

Okay. Because it might be a cleaner if that was taken out – if that qualifies.

Malcolm Davidson

I can send an email on that.

Rob Chang

Sure. Yeah, sounds good. Second question is – I’ve been looking for this. I’m not sure if I missed it. But do you have any hedging or some type of contracts in place? And the reason why I ask you is I tried to reconcile your sales based off of realized pricing and I couldn't quite get to the number you have in Canadian dollar terms. Because it ends up translating at probably a $0.89 US to Canadian exchange rate if I were to do it roughly. I’m just wondering if there are any hedges in place or anything that explains why it couldn't quite match up the numbers.

Malcolm Davidson

We don't have a hedging program in place at the moment. It’s something we’re looking at. The operation has grown significantly, having the Avino mine online. But as far as the reconciliation, Jasman, maybe you can comment on – just not too much on the dollar wise, but on our ounces sold because that’s what’s driving the difference in revenues as well?

Jasman Yee

Yeah. As far as revenues go, Rob, basically we get paid on the basis of our deliveries. So in our contract with Samsung, basically, our sales are based delivery and it's really the month of delivery plus three months down the road to finalize the pricing. And as far as I'm aware, all the revenues that we get based on the final invoicing is factored into the revenue side of things.

Rob Chang

Okay. But that price –

Jasman Yee

I hope that answers your question.

Rob Chang

It sort of does. What I'm driving at, though, is the realized pricing that you guys report, for example, $16.99 in silver in US dollar terms, if I were to just multiply that into your silver equivalent numbers, I'd get somewhere in the neighborhood of $10.6, let’s call it, US dollars. So if I throw in the exchange rate at the time, which I believe was better than $0.89, it gets to be a much higher number than CAD 11.9 million. So I was just trying to figure out how that reconciles. I’m not sure if that’s something you can answer over the phone or if we should do this offline, but I was just trying to get a sense of if there was an easy answer.

Malcolm Davidson

It’s Malcolm here again. You know what, let’s have a chat after the call. I actually have a – I do have a few other comments that I can go over with you.

Rob Chang

Great, thank you.

Malcolm Davidson

Thank you.

Operator

The next question comes from Bhakti Pavani from Euro Pacific Capital. Please go ahead.

Bhakti Pavani

Good morning, guys.

Malcolm Davidson

Good morning.

David Wolfin

Hi, Bhakti.

Bhakti Pavani

Just a quick question, what was the capital expenditure for the quarter and how should we be looking for the expense for the remaining year?

David Wolfin

So during the period, I think our capital additions was about CAD 1.5 million. So, now, when you’re looking at the statements just to clarify, you’re going to see a transfer of about CAD 8.6 million out of exploration and evaluation assets and about CAD 6 million going into property, plant and equipment. And that’s reflected in the adjustment to transfer the value of the Avino Mine from exploration and evaluation assets to property, plant and equipment. So that sort of is the movement within the balance sheet.

Going forward, we’ve acquired most of our equipment needed for our current operations. We’ll have a little bit for maintenance, but it won’t be significant. And we have budgeted about CAD 2.5 million for the completion of the new tailings facility, which is planned to be completed before the end of the year.

Bhakti Pavani

And how would that breakup or distribute between Q3 and Q4?

David Wolfin

I would say, 50/50. It might be a little bit more in Q4, but there are some upfront costs. But I would say 50/50 is reasonable between the two quarters.

Bhakti Pavani

Okay. Also the cash cost was slightly higher compared to your past. And I'm assuming that because of the Avino – declining commercial production at Avino Mine. Could you maybe provide some color on how you can reduce that cost further for the remainder of the year, if possible?

Malcolm Davidson

Sure. Just a few comments on cash cost. First of all, the margin on San Gonzalo was relatively the same, although we did sell – we did sell fewer ounces from San Gonzalo. So that brought the cash cost up at San Gonzalo a little bit. But with the Avino Mine, at the moment, we’ve got a combination of a production mining cost and development mining costs. And development mining costs are significantly more expensive. That being said, when we transitioned to production in April, a large portion of the inventory that was traded over and subsequently treated as cost of sale was much higher because it was development type mining that was used when that inventory was actually produced. Now, going forward, probably for the next nine months, we’ll be using a combination of development mining and production mining. We will see the cost go down. And I would say, 2017, we’ll see a significant reduction when we’re only production mining.

David Wolfin

We’re still ramping down to the bottom of the mine and putting in new levels, so that’s the development mining.

Bhakti Pavani

Fair enough. Fair enough. All right. Thank you very much, guys. That’s it from my side.

David Wolfin

Thank you.

Malcolm Davidson

Thanks, Bhakti.

Operator

The next question comes from Heiko Ihle from Rodman & Renshaw. Please go ahead.

Heiko Ihle

Hey, good morning, guys. Congrats on the quarter.

David Wolfin

Hi, Heiko.

Heiko Ihle

I’ll start with this one. Consolidate all-in sustaining cost was CAD 14.51 an ounce per silver equivalent ounce, a 247% increase compared to CAD 11.72. I take it that it is just a typo, given that if you do the math it gives you 23.8%. But I just want to make sure and I'm pretty sure I'm not missing something insanely obvious here.

Malcolm Davidson

No. Thanks for pointing that out, Heiko. Absolutely right. It did increase, but not by 247%.

Heiko Ihle

Because that will be very scary.

Malcolm Davidson

It would be.

Heiko Ihle

Okay, fair enough. So 23.8% is the number to use then [indiscernible]. So long-haul mining on Bralorne, you’ve said you’re getting the equipment. It sounds like a lot. The technical analysis stuff is done. Couple of things. Can you just sort of walk us through timeline cost savings, anticipated cost of getting that stuff? Just elaborate a little bit of what you’ve got listed in the release please.

Malcolm Davidson

For Bralorne or…?

Jasman Yee

Yeah, this is for Bralorne. Heiko, we’re still studying this. And basically, the old method of mining, which is the standard scope mining, basically, you could get only about a third of the tonnage as you’re developing the scope. And, normally, this is the swell that’s being taken off while you’re mining. With the long-haul, basically, whatever you mine, you'll be getting it out, which is why the larger throughput makes a lot of sense. At the same time, you’ve really got to factor in – there’s also a dilution problem that you may be faced with. So, basically, we want to do the actual test with numbers currently being generated by Entech, which is the engineering firm that has a lot of long-haul mining experience and they’re sort of helping us walk us through on this. But the first phase would be to do an actual test and see how this works out when we start out the Bralorne operation.

Bhakti Pavani

And how would that breakup or distribute between Q3 and Q4?

David Wolfin

I would say, 50/50. It might be a little bit more in Q4, but there are some upfront costs. But I would say 50/50 is reasonable between the two quarters.

Bhakti Pavani

Okay. Also the cash cost was slightly higher compared to your past. And I'm assuming that because of the Avino – declining commercial production at Avino Mine. Could you maybe provide some color on how you can reduce that cost further for the remainder of the year, if possible?

Malcolm Davidson

Sure. Just a few comments on cash cost. First of all, the margin on San Gonzalo was relatively the same, although we did sell – we did sell fewer ounces from San Gonzalo. So that brought the cash cost up at San Gonzalo a little bit. But with the Avino Mine, at the moment, we’ve got a combination of a production mining cost and development mining costs. And development mining costs are significantly more expensive. That being said, when we transitioned to production in April, a large portion of the inventory that was traded over and subsequently treated as cost of sale was much higher because it was development type mining that was used when that inventory was actually produced. Now, going forward, probably for the next nine months, we’ll be using a combination of development mining and production mining. We will see the cost go down. And I would say, 2017, we’ll see a significant reduction when we’re only production mining.

David Wolfin

We’re still ramping down to the bottom of the mine and putting in new levels, so that’s the development mining.

Bhakti Pavani

Fair enough. Fair enough. All right. Thank you very much, guys. That’s it from my side.

David Wolfin

Thank you.

Malcolm Davidson

Thanks, Bhakti.

Operator

The next question comes from Heiko Ihle from Rodman & Renshaw. Please go ahead.

Heiko Ihle

Hey, good morning, guys. Congrats on the quarter.

David Wolfin

Hi, Heiko.

Heiko Ihle

I’ll start with this one. Consolidate all-in sustaining cost was CAD 14.51 an ounce per silver equivalent ounce, a 247% increase compared to CAD 11.72. I take it that it is just a typo, given that if you do the math it gives you 23.8%. But I just want to make sure and I'm pretty sure I'm not missing something insanely obvious here.

Malcolm Davidson

No. Thanks for pointing that out, Heiko. Absolutely right. It did increase, but not by 247%.

Heiko Ihle

Because that will be very scary.

Malcolm Davidson

It would be.

Heiko Ihle

Okay, fair enough. So 23.8% is the number to use then [indiscernible]. So long-haul mining on Bralorne, you’ve said you’re getting the equipment. It sounds like a lot. The technical analysis stuff is done. Couple of things. Can you just sort of walk us through timeline cost savings, anticipated cost of getting that stuff? Just elaborate a little bit of what you’ve got listed in the release please.

Malcolm Davidson

For Bralorne or…?

Jasman Yee

Yeah, this is for Bralorne. Heiko, we’re still studying this. And basically, the old method of mining, which is the standard scope mining, basically, you could get only about a third of the tonnage as you’re developing the scope. And, normally, this is the swell that’s being taken off while you’re mining. With the long-haul, basically, whatever you mine, you'll be getting it out, which is why the larger throughput makes a lot of sense. At the same time, you’ve really got to factor in – there’s also a dilution problem that you may be faced with. So, basically, we want to do the actual test with numbers currently being generated by Entech, which is the engineering firm that has a lot of long-haul mining experience and they’re sort of helping us walk us through on this. But the first phase would be to do an actual test and see how this works out when we start out the Bralorne operation.

Michael Heim

And what was the tax expense?

Malcolm Davidson

The tax expense was CAD 1.9 million and that was made up of CAD 900,000 of current income tax expense, which is basically tax on our net income. And it was about CAD 1 million of deferred income tax expense, which I commented on a little bit earlier with Rob. And the biggest component of that CAD 1 million, again, was foreign exchange.

Michael Heim

Also on an unrelated note, are we getting closer to new reserve numbers?

David Wolfin

Yeah, there’s a new 43-101 expected out this summer.

Michael Heim

Okay. All right, thank you.

David Wolfin

Thank you.

Malcolm Davidson

Thanks, Mike.

Operator

[Operator Instructions] The next question comes from Todd Davis, a private investor. Please go ahead.

Todd Davis

Thank you, gentlemen. My question has been answered. I was just curious on your average silver selling price. It just seemed low for the quarter considering silver was above $17 an ounce rather than the first week of June. So I was just a little curious on that.

David Wolfin

Malcolm?

Malcolm Davidson

It’s a little low. My comment would be there is – simply different from about a month.

Jasman Yee

Yeah, it’s N plus 3. The fact that our silver pricing is based on the month of delivery –

Malcolm Davidson

Correct.

Jasman Yee

And three months after that. So, basically, we’re sort of lagging a little behind other the current price. It’s basically what –

Malcolm Davidson

Yeah. Some of the higher metal prices we’ve seen in the last few months, we will start to realize those in Q3.

Jasman Yee

Yeah, in Q3. Correct.

Todd Davis

Okay, gentlemen. Congratulations again on bringing Avino online. Thank you very much.

David Wolfin

Thank you.

Operator

The next question comes from Bernie Milask [ph], a private investor.

Unidentified Analyst

Yes. I have a fairly simple question. Your contract with Samsung, I guess, they take out treatment and refining charges. Now, do the treatment and refining charges and the shipping charges come out before income or are they counted as part of your income? In other words, is it pre-income or is it after income? And can I count that as a cost?

Malcolm Davidson

It’s pre-income.

Unidentified Analyst

Okay. So in other words, the revenue already includes those treatment and refining charges?

Malcolm Davidson

That’s correct. The revenue is on a net basis. And then we deduct our in-house production costs.

Unidentified Analyst

Okay. Now, the question on Avino is, you have production of 2,222 tonnes, but yet you shipped 2,665 tonnes or 2,663 tonnes. Where did the extra tonnage come from? If I'm reading your MD&A correctly.

David Wolfin

I think we always keep a surplus, so we may have delivered a little more that quarter.

Unidentified Analyst

Okay. It’s just timing of deliveries.

Malcolm Davidson

Correct.

Unidentified Analyst

Okay, thank you. That's all I have.

Malcolm Davidson

Thanks for the questions.

Operator

The next question comes from David Sheridan from World Over Capital. Please go ahead.

David Sheridan

Yeah. Hi, guys.

David Wolfin

Hello.

David Sheridan

Just coming back to this particular point everyone keeps talking about with respect to the price received versus the silver price that you state. It would appear to me, having gone back in history over the life of Avino, did you basically lose about 13% or 14% every quarter, which is basically the charge that you must be – now being charged by Samsung and previously being charged by someone else? Is that a fair comment?

Malcolm Davidson

Correct.

David Sheridan

Yeah. That’s what I thought. Okay, fine. Next thing, is the target for 2016 on production still to produce around 3 million equivalent ounces of silver?

David Wolfin

It's between 2.8 million and 3 million.

David Sheridan

2.8 million to 3 million, okay. And after the second quarter's results, how are you feeling about that as far as where you are likely to be in that range? Are you feeling that you’re more likely to be at the conservative end or are you more optimistic you can get towards the upper end?

David Wolfin

Jasman, you want to take that one?

Jasman Yee

Yeah, I think on the conservative side. I think we’re probably looking more like about 2.8 million ounces for the year.

David Sheridan

Yeah, fair enough.

Jasman Yee

I would say, and if we do hit 3 million, that’s really a bonus.

David Sheridan

Okay. Two more questions for you. There has been discussion – I know the CEO has mentioned at various time – that there is – once Avino Mine comes into production and that you establish your mining capability and you're more confident of your reserve position that you would contemplate an increase in mill capacity at the combined San Gonzalo and Avino Mines from 1,500 tonnes per day, which is where you are now, towards 2,500 tonnes per day at a cost of around $3 million. Is that still something that you're contemplating? And if you are contemplating, is the decision determined by the upcoming 43-101 statement, which will give you more conference as to how much ore you’ve got there or is it dependent on other factors?

David Wolfin

The additional circuit we’re looking at is estimated to cost between 2 million and 3 million. That’s not including the cost for more underground mining equipment. So we're studying this right now. And as we develop the rest of the mine and open up enough levels to see the larger mill, we will then plan towards that in the future. So it's currently in planning phase.

David Sheridan

Yeah. But is it determined more by the 43-101 that’s coming up?

David Wolfin

No.

David Sheridan

No, not determined?

David Wolfin

No, it’s determined by a number of factors. It’s determined by having the mine fully developed, having enough haulage trucks to bring it out, to feed the larger circuit and timing it all, so when the mill is ready, we can feed it. So we’re looking at larger trucks for the underground and availability of getting the larger trucks. So it’s a lot that we’re – we don’t have a timeline on it just yet.

David Sheridan

Right, okay. Which brings me to the next point which is that the new tailings dam that you are putting in place now at a cost of around 2.5 million, I'm assuming all of these costs that you talk about are in Canadian dollars because I'm not really sure. You didn’t measure at one point, but now it’s slightly different exchange rate, I guess, it matters a bit more. So are they Canadian dollars you talk about or US dollars?

Malcolm Davidson

No, it’s usually US dollars.

David Sheridan

US dollars, okay.

Malcolm Davidson

Most of our capital items and significant expenditures are in US.

David Sheridan

Okay, fair enough. So it brings me to the point, you’re going to put in a new tailings dam, which should take out six months, take you to the end of the year, and then you’re contemplating at some point, basically, processing what is left in the old tailings dam.

David Wolfin

How it works is that we have a PEA and then the recommendation we must drill off the entire tailings dam. And we want to test – metallurgically test the upper sulfides. There’s about 3.5 million tonnes of sulfide sitting on top of about 2 to 3 million tonnes of oxides. So in order for us to proceed and make a construction or production decision, we need to do more testing. So the PEA – it’s just a PEA. It’s not a pre-feas or a feas. So it recommends extensive drilling of the tailings and metallurgical test work to see if the upper sulfide leach. If so, that’s going to improve the economics and then we can – we’ll have a reserve and we can make a construction decision at that time. So to get a head start on all this, we pre-drilled over Sweden predrilled the exposed oxide bench because it wasn't damp, it wasn't dangerous to put a drill rig on it. So we've completed that. And that portion of the oxides is going to be included in the new resource estimate. So once we decommission the tailings dam, we’re going to drill some wells, so we can pump out the water that’s saturated through it and then it will be safer to put a drill rig up on the top.

David Sheridan

Okay. So is there any timeline with respect to what you – when you think you’ve got to finish the drilling and get an idea of what you're –

David Wolfin

Well, as soon as we finish building the new tailings facility, then we’ll decommission. We’ll stop dropping new tailings on it and carry on immediately. So we’ll put in those water wells, dry it out. And as soon as it’s safe to put a rig on top, we’ll do that. So that will be next year. Then we’ll do metallurgical test work and Jasman can tell you what’s involved in that and how long that takes. Jasman, do you want to comment on that?

Jasman Yee

Yeah, basically, the drilling and the test work will take place next year once the tailings dam has been decommissioned – the old tailings dam has been decommissioned. According to the Tetra Tech schedule, when they did the PEA, they were looking at it from the time they start to the time the study is completed is around about eight months, the construction and everything. So that’s more or less the timeline that we’re sort of working with.

David Sheridan

Right. So just to give me a rough idea, would that indicate that you’re drilling metallurgical work, it’s finished in 2017, eight months for construction, potentially you are going to be producing from there somewhere at the back end of 2018. Is that fair enough?

Jasman Yee

If all goes well.

David Wolfin

Yeah.

Jasman Yee

Yeah.

David Sheridan

Okay. And is there any sort of relationship between that and the expansion – or potential expansion of production from Avino? In other words, does the two sort of some stage come together, you have to make a decision as to which one you opt for first or can they be run concurrently?

David Wolfin

They can be run concurrently.

David Sheridan

But, of course, the mill is going to be the factor – is the mill going to be a factor as far as --?

David Wolfin

We have three independent circuits, so we wouldn't be shutting down anything. So we could just build –

David Sheridan

I know you’re not shutting down anything. But you can’t just keep – you can’t expand Avino and stop production at the tailings without –

David Wolfin

The tailings is a separate operation. It’s right beside. It’s a heap leach operation. The mill is the flotation plant.

David Sheridan

Okay, yeah. Okay. Yeah, yeah, of course, you’re on it. So there’s no overlap between increasing production at Avino and in heap leach operation at the tailings. You can do them the same and they’re not using the same equipment.

Jasman Yee

Correct.

David Wolfin

Absolutely.

David Sheridan

Okay, all right. And when you’re doing your drilling in metallurgical work next year, you’d be also assessing the cost – the final cost of doing – of trading the tailings because –

David Wolfin

Absolutely.

David Sheridan

Yeah. Your PEA said about 22 million, if I remember.

David Wolfin

29 million on a standalone basis. We have 490 people there. So it won’t be a standalone operation.

David Sheridan

All right, okay.

David Wolfin

All the infrastructure is there.

David Sheridan

Yeah. No, I understand that.

David Wolfin

So 43-101 requires economic studies to be priced out on a standalone basis.

David Sheridan

Yeah, okay. Well, that’s the end of my questions.

David Wolfin

Thank you very much.

Operator

The next question comes from Mare Kas [ph], a private investor. Please go ahead.

Unidentified Analyst

I’m sorry, operator. Can’t respond.

David Wolfin

We can hear you.

Unidentified Analyst

Okay, good. Okay, sorry. I’m talking to you via Skype from Europe. That’s why I thought that – my telecommunications here wasn’t adequate.

David Wolfin

We hear you loud and clear. Please proceed.

Unidentified Analyst

Yes. My questions, the ATM of Cantor Fitzgerald, any indication as to when you might be using it or what point in the drop in your working capital because you have – based on the answers to some of other questions, that’s a question we think you have a fairly ambitious cash requirement over the next two years.

Malcolm Davidson

As David – this is Malcom here. As David mentioned earlier, we’ve strategically used the ATM when it’s – it always works best for raising capital for some of the expansion, but we’ll continue to use it strategically. We may use it for some of our expansion plans or we may look at other financing opportunities with some of our current partners. But, no, we’ve managed it well and we’ve been very careful that we haven’t overused it.

Unidentified Analyst

Okay. And also, just based on – pulling all the questions together from the analysts and from investors, I just see that there’s a lot of difficulty in understanding your financial statements because of the currency translations that you’d have to go through, which inadvertently seems to kick up some income tax liabilities. Maybe you can devote some time to peering it up, so we can easier time of understanding what you’re doing. You’re doing well, pardon me. You’re doing it well, except – so that we can understand it easier.

Malcolm Davidson

It’s a really good comment and the finance team has looked a few alternatives and one of them is reporting in US dollars, which makes a lot of sense in many ways. But it also will depend on how we proceed with Bralorne. Not that that makes all the difference in the world, but most of the expenditures at Bralorne are in Canadian dollars. But it’s a good question and obviously we want to mitigate the impact of foreign exchange, certainly negative ones, on our financial statements. So it is certainly a priority for us. And this ATM will have some updates in the next quarter or two.

Unidentified Analyst

All right. And just a very quick question. I know that you have in the past negotiated some good deals with Sandvik and Caterpillar. Are you noticing any tendency for price increases, which is basically what happened in the period from 2008 to 2013 where all the precious metal price increases were eaten up in the prior – I'm not referring to your particular case, but in general, in the mining industry, were pretty well eaten up by increased expenses on equipment raises and so on.

Malcolm Davidson

It’s a good point. As I mentioned earlier, we’ve already acquired most of the capital equipment we need for our current operations. So we haven’t been buying a lot of new equipment. Obviously, we do keep a close eye on costs. But we do have a lot of sources that we can continue to utilize our current credit facilities at Caterpillar and Sandvik. We also may look at – there’s a lot of good used equipment on the market right now.

Unidentified Analyst

Okay.

Malcolm Davidson

So it really depends. But we certainly have low-cost access to it.

Unidentified Analyst

And a quick question on the Samsung. Do they really – when they were doing due diligence on you and, obviously, they must have spent a lot of time with you, did you get the impression that they felt somewhat exposed or fragile that they couldn’t have a secure silver source?

Jasman Yee

We didn’t sense that at all when we were negotiating with them.

David Wolfin

They had told us that Apple and Intel were promoting that they know where the source of their raw materials are coming from and that they weren’t coming from slave labor type operations. And they just wanted a secure source. They have ethical funds that own shares in their company and they don’t want them to be boycotting Samsung for any bad press or anything like that. So they just – they are trying something different and new and it seems to be working out well.

Unidentified Analyst

Okay. So it’s sort of an ethical – from an ethics perspective rather than a supply shortage or securing a supply.

David Wolfin

It’s probably both.

Unidentified Analyst

Okay. Eric Sprott is saying that – eventually, there’s going to be a silver shortage. [indiscernible] also. So I'm just questioning whether you’re actually – whether it’s actually – whether it’s actual or whether this is something that’s being only predicted at this point?

David Wolfin

Well, I think there's an imbalance of supply and demand. It’s being consumed. So at some point, yeah, there could be a squeeze that takes the value up higher. Nobody knows when that's going to happen because you’ve got the ETFs and the paper – the securities out there that kind of skew the figures and people's perception. So there's $1 billion worth of ETFs that change a day and there's only probably a billion ounces of silver produced annually.

Unidentified Analyst

Thank you. That’s all for now.

David Wolfin

Thank you.

Operator

The next question comes from Grant Marcat [ph], a private investor. Please go ahead.

Unidentified Analyst

Hello. How are you guys?

David Wolfin

Hi, Grant.

Unidentified Analyst

Hi. Perfect timing. This tails right on what you were seeing and about the current silver shortage, the imbalance of supply and demand. And as a shareholder, that's kind of the elephant in the room for me on investing in companies like yours. Really, the current mechanism that sets the price, anywhere from 4 to 12 players that set what 80% of the spot price. So I’m just kind of looking for comments, maybe more comments than you already touched on on things involving the gold to silver ratio that are way out of whack, just getting to the realization of the true supply and demand? And maybe you can touch a little bit on what happened in 2011. Why did the price jump up to $48? Why are we out where we’re at now? What's changed? We’re looking at something in 1980 that, as we all know, the Hunt brothers, two wealthy brothers bought too much of it and the raised the price to $50. So it’s a very interesting commodity and I’m just seeing if you can touch on some of –

David Wolfin

Yes. I think supply and demand is what helped – that drove it up in the mid-2000s. And then, in 2011, it was the COMEX that raised the margin requirements about five times in two weeks because the warehouses in Chicago couldn't keep up with the delivery and they wanted to stop the speculators from driving it up too fast. So that's what capped the ascent. But I think it’s just all a sign. I think that demand is growing. They’re using it in solar, they’re using it in electronics. All of that is growing. And they say it’s the poor man’s silver. So a lot of people are buying coins and putting them away. So I just don't see the demand slowing down anytime in the future. A lot of people are concerned about what’s going on in the world and they are loading up. There’s going to be like a squeeze, like it’s going higher. But I just can’t tell you within a year or two, but in the long-term it's going up.

Unidentified Analyst

Would you guess it would be more driven on industrial usage? Silver is something – now we really can’t live without it, with the way we use it now in our life. And we’re talking about a monetary metal that a lot of people forget. The financiers think so much about gold, but pre-1933 is when we have to go back to see gold as a currency. We can go all the way up to 1970 to see silver used as money. So, to me, silver is a much more monetary –

David Wolfin

Absolutely. And I think a lot of people agree with you. That’s why they buy the coins because if they had to use it for money, it’s a lot easier to sell them because they’re in smaller denominations than gold.

Unidentified Analyst

So you think investment demand in the future could be just a stronger of a driver than industrial –

David Wolfin

Absolutely. The US mint can't even keep up with demand on printing – making the coins.

Unidentified Analyst

Or I hear. Well, some of the largest players setting the price are buying it.

David Wolfin

[indiscernible] anyone’s interested.

Unidentified Analyst

But one last question, guys, if you don’t mind.

David Wolfin

Sure.

Unidentified Analyst

I know one of the largest players in the industry has spoken recently of – suggesting a hold back of silver to help fight back against the silver fix.

David Wolfin

Sure, sure.

Unidentified Analyst

Any comment on that?

David Wolfin

We’d love to be able to do that, but we’re using all our cash to finish our expansions and grow operation. So at some point, we'd like to be able to do that. But we’re just not at that stage just yet. But it's a good idea.

Unidentified Analyst

And one of those easier said than done things for [indiscernible].

David Wolfin

First Majestic is holding back some of their production, but they're issuing equity. So which is better for the investor in the long run, I'm not sure.

Unidentified Analyst

I wish the best to you guys. I'm really liking your company. I’m liking the future of silver, as we spoke about. So keep going.

David Wolfin

Thank you very much.

Malcolm Davidson

Thanks, Grant.

Unidentified Analyst

You bet. Thanks, guys. Have a good day.

David Wolfin

Yeah.

Operator

This concludes today's question-and-answer session. I would like to turn the conference back over to David Wolfin for any closing remarks.

David Wolfin

Well, I just want to thank you all very much for your time and interest in the company. Those questions were fantastic. Stay tuned. We have a lot of good news coming, more expansions coming. So keep an eye on us. And thanks again. Take care.

Operator

This concludes today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.

[Fantomas96]

Antwort auf Beitrag Nr.: 53.070.840 von blue-moon am 16.08.16 15:51:14

Was, Du gehst schon wieder ?
Dabei haben wir die CAD 5,00 ja noch nicht mal ansatzweise erreicht.

[blue-moon]

Soros ist aus Gold raus und hat seine Minenanteile verkauft - ich bin dann auch mal weg!
Zumal die Zahlen hier nicht gut waren.
Aber die Aktie ist eine Perle und ich komme wieder, wenn der Kurs tiefer steht.
Viel Glück denen die das aussitzen.

[Streberleiche]

Antwort auf Beitrag Nr.: 53.066.319 von Fantomas96 am 16.08.16 06:20:24

Der Produktionsrückgang, die Erhöhung der AISC und der kleine Nettoverlust sind natürlich nicht so schön. Aber wenn dies, wie der CEO erwähnt, die kurzfristige Folge der Wartungsarbeiten an der Bralorne Mine im Q2 lag, und die Produktion im 2 HJ. wieder steigt, werden somit auch die AISC wieder etwas sinken. Dazu der i.V. zu Q2 weitaus höhere POS, und schon sieht es auf der Income-Seite wieder ganz anders aus...

Zumindest wird jetzt auch klar, weshalb die Aktie i.V. zu vielen anderen Silvberminen nur "verhalten" gestiegen ist, und im dritten Quartal sogar eher stagniert hat.

Ich lasse meine verhältnismäßig kleine Portion mal im Depot, kaufe aber auch nicht mehr zu. Es sei denn, der POS zieht weiter an und die Aktie verweilt auf diesem Niveau...

Gruß
SL