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Anaconda Mining Generates $126,032 in Net Income for FY Q2

Anaconda Mining Generates $126,032 in Net Income for FY Q2 2013 
TORONTO, ONTARIO -- (Marketwire) -- 01/15/13 -- Anaconda Mining Inc.
("Anaconda" or the "Company") - (TSX:ANX) is pleased to report its
financial and operating results from the fiscal 2013 second quarter
ended November 30, 2012. The Company generated net income for the
three and six months ended November 30, 2012 of $126,032 and
$1,638,880 or $0.00 and $0.01 per basic and fully diluted share,
respectively. Earnings before interest, taxes, depreciation,
amortization and non-cash share-based compensation ("EBITDA") was
$849,173 and $3,256,657 for the three and six months ended November
30, 2012, respectively. 
During the second quarter, the Company sold 3,194 ounces of gold and
generated $5,395,563 in revenue at an average gold sales price of
$1,686 per ounce. Cash cost per ounce sold for the second quarter on
a consolidated basis and at Pine Cove were $1,423 per ounce and
$1,256 per ounce, respectively. For the first half of fiscal 2013,
the Company sold 7,411 ounces of gold and generated $12,255,862 in
revenue at an average gold sales price of $1,654 per ounce. Cash cost
per ounce sold for the first half of the fiscal year on a
consolidated basis and at Pine Cove were $1,214 per ounce and $1,081
per ounce, res
pectively. 
During the six months ended November 30, 2012 the Company incurred
certain one-time expenses, which contributed to the higher than
expected cash operating unit costs. In the mill, the Company had to
make unscheduled repairs to the foundation of the thickener for
$115,000. Additionally, in November, a portable crusher was utilized
at a cost of approximately $80,000 for a short period of time to
supplement production while Pine Cove's permanent crusher was
undergoing a detailed evaluation. Lastly, the removal of Pasture
Pond, an area at the north end of the ultimate pit that contained a
pond and considerable overburden, cost approximately $270,000. All of
these costs added roughly $63 per ounce to the operating expenses
over the first two quarters of fiscal 2013. 
Anaconda President and CEO, Dustin Angelo, stated, "The Company had a
profitable quarter despite a slow restart after Pine Cove's scheduled
maintenance shutdown at the end of August, lower than expected head
grade and some one-time expenses. Mill throughput improved from 856
tonnes per day in Q1 to 884 in Q2 with October and November both
averaging over 900 tonnes per day. The Company also continued to
advance its organic growth story around Pine Cove with two more
property option agreements during the second quarter. In addition, we
made progress with respect to our peninsula-wide exploration and
trenching program as well as the bulk sample at the Romeo and Juliet
prospect. More recently, we began drilling the down-dip area just
north of our pit." 
During the three months ended November 30, 2012, the gold sales
volume of 3,194 ounces represented a 47% increase over the same
period in 2011 (second quarter of fiscal 2012). Average sales price
for the second quarter of fiscal 2013 was $1,686 per ounce versus
$1,751 per ounce for the second quarter of fiscal 2012. As a result
of higher sales volume, gross revenue during the three months ended
November 30, 2012, which was $5,395,563, exceeded the same period in
the previous fiscal year by $1,603,519. 
All amounts are in Canadian dollars unless stated otherwise. The
financial results and Management's Discussion and Analysis of these
results may be found on Anaconda's website (www.anacondamining.com)
and on its SEDAR profile (www.sedar.com). 
Highlights for the three and six months ended November 30, 2012: 
BALANCE SHEET: 


 
--  As at November 30, 2012, the Company had cash and cash equivalents of
    $98,945 and a net working capital deficit of $2,127,821. The Company had
    $581,800 in outstanding accounts receivable related to gold sales, which
    were collected just after quarter end. The working capital deficit is
    primarily due to the loans and debentures becoming current. 
--  During the six months ended November 30, 2012, the Company made
    principal payments of $1,476,628 and reduced its overall debt to
    $2,840,436. Of the total principal paid, $1,298,000 went against its
    Series I, Series II and the Thorsen loans on a pro-rata basis. 

 
OPERATING PERFORMANCE: 


 
--  For the three and six months ended November 30, 2012, the Company sold
    3,194 and 7,411 ounces of gold and generated $5,395,563 and $12,255,862
    in revenue at an average sales price of $1,686 and $1,654 per ounce,
    respectively. 
--  Cash operating cost per ounce sold at the Pine Cove project for the
    three and six months ended November 30, 2012 was $1,256 and $1,081 per
    ounce, respectively. 
--  At the Pine Cove project, EBITDA for the three and six months ended
    November 30, 2012 was $1,384,528 and $4,247,328, respectively. 
--  On a consolidated basis, EBITDA for the three and six months ended
    November 30, 2012 was $849,173 and $3,256,657. 
--  Net income for the three and six months ended November 30, 2012 was
    $126,032 and $1,638,880 or $
0.00 and $0.01 per basic and fully diluted
    share, respectively. 
--  Purchase of property, mill and equipment for the six months ended
    November 30, 2012 was $916,042. 
--  Approximately $395,000 was spent at the Pine Cove project on exploration
    for the six months ended November 30, 2012. 

 
STRATEGIC REVIEW: 


 
--  On July 19, 2012 the Company entered into a five-year property option
    agreement with Fair Haven Resources Inc. ("Fair Haven") to acquire a
    100% undivided interest in 11 exploration licenses (the "Fair Haven
    Property") totaling 71 claims or approximately 1,804 hectares. 
--  On August 2, 2012, the Company staked additional property near the Pine
    Cove project totaling 3 mining licenses and nearly 300 hectares. 
--  On November 13, 2012 the Company entered into a five-year property
    option agreement (the "Agreement") with Herb Froude ("Froude") to
    acquire a 100% undivided interest in one exploration license (the
    "Froude Property") totaling 11 claims or approximately 275 hectares. 
--  On November 19, 2012 the Company entered into a five-year property
    option agreement (the "Agreement") with Messieurs Duffitt and Strong
    ("Duffitt and Strong") to acquire a 100% undivided interest in 2
    exploration licenses (the "Duffitt and Strong Property") totaling 7
    claims or approximately 175 hectares. 
--  During the first and second quarters, the Company's exploration
    initiatives focused on prospecting the properties across the Pine Cove
    project and obtaining a bulk sample from the Romeo and Juliet prospect. 

 
OPERATIONAL OVERVIEW 
Pine Cove project, Baie Verte, Newfoundland: 
Mill operations: 
The Pine Cove mill operated for 86 days during the three months ended
November 30, 2012. Mill availability was 95% for the quarter. The
mill processed 76,292 dry tonnes of ore (884 tonnes per operating
day) at an average head grade of 1.75 grams per tonne ("g/t"),
slightly lower than the 1.83 g/t projected for the quarter. Overall
mill recovery averaged 83% for the quarter, which was on budget. The
following table summarizes the key mill operating statistics for the
three months ended November 30, 2012 and November 30, 2011. 


 
                                                                            
OPERATING STATISTICS:                                                       
                                              November 30       November 30 
Three months ended                                   2012              2011 
----------------------------------------------------------------------------
                                                                            
Availability                                           95%               72%
Dry tonnes processed                               76,292            55,369 
Tonnes per 24-hour period                                                   
(throughput)                                          884               837 
Grade (g/t)                                          1.75              2.04 
Overall mill recovery                                  83%               78%
                                                                            
Gold sales volume (troy oz.)                        3,194             2,166 

 
Year over year mill performance for the second quarter improved
substantially, primarily due to increases in mill availability,
throughput, and recovery. The disparity in availability and
throughput is because the mill underwent a scheduled shutdown in Q2
FY 2012 to replace the drum filters and perform routine maintenance.
For the current fiscal year, the scheduled maintenance already
occurred in the first quarter. The new filtration equipment combined
with a new coagulant provided a significant boost in both recovery
and availability in the drum filter circuit beginning after the
second quarter of fiscal 2012. Capital improvements in the leaching
circuit, consisting of modifications to the down-comers, improved
leach recovery as well. Mill operations also benefited from finer
graduation of feed to the grinding circuit and through the regrind
mill after the filtration circuit was no longer impeded by filter
blinding, which was solved by the introduction of the aforementioned
new coagulant. Head grade in the mill was 1.75 g/t in the period
versus 2.04 g/t for the same period in the prior fiscal year. 
Mining operations: 
During the three months ended November 30, 2012, mining activities
operated for a total of 64 days and excavated a total of 556,028
tonnes of ore and waste. Ore production totaled approximately 61,000
tonnes while waste production was approximately 495,000 tonnes for a
strip ratio of 8.1:1. The following table summarizes the mining
p
roduction for the three months ended November 30, 2012 and November
30, 2011: 


 
                                                                            
OPERATING STATISTICS:                                                       
Three months ending                             November 30      November 30
                                                       2012             2011
----------------------------------------------------------------------------
                                                                            
Operating days                                           64               53
                                                                            
Ore production (tonnes)                              61,172           46,276
Waste production (tonnes)                           494,856          178,271
Total production (tonnes)                           556,028          224,547
Waste to ore ratio (strip ratio)                        8.1              3.9

 
The removal of Pasture Pond from the north side of the pit, which
started in the first quarter of fiscal 2013, continued through
September, the first of month of the second quarter. To complete the
removal of the pond, the Company employed a second mining crew to
remove organic and waste surface material at Pasture Pond and extend
the pit on the north side to its ultimate limit. As of the end of the
second quarter, the Pasture Pond stripping project was complete. 
Year-to-date November 30, 2012, because of the Pasture Pond project,
the Company budgeted to have a strip ratio of approximately 6.2 : 1
while the actual strip ratio was slightly higher at approximately 6.8
: 1. Excluding the Pasture Pond project, the actual strip ratio in
the pit was approximately 5.4 : 1. The budgeted strip ratio for the
balance of fiscal 2013 is under review, due to potential changes in
pit design and pending results from the drilling activity down-dip of
the pit, which is currently underway. 
Exploration update: 
During the first half of fiscal 2013, the Company focused on the
regional exploration potential across the 4,785 hectares it controls
on the Ming's Bight Peninsula and the Romeo and Juliet bulk sample,
as described below. 


 
   1. Regional Exploration: Past mineral exploration activities in the      
      Ming's Bight area on the Baie Verte Peninsula, dating mainly from the 
      period 1985-1990, resulted in an extensive collection of archived data
      that includes more than 30,000 gold-in-soil geochemical analyses. Much
      of this data has never been adequately followed up and many anomalies 
      have not been explained. Compilation and digitizing of this historic  
      geophysical and soil geochemical data was initiated by Tenacity Gold  
      Mining Company Ltd. and completed by Anaconda. Prospecting teams have 
      followed up much of the historic soil data and completed infill       
      sampling in some areas.                                               
                                                                            
      As a result of the positive sampling results, trenching targets have  
      been identified in the Ming's Bight and Goldenville areas. Trenching  
      permits have been approved for the Ming's Bight targets and trenching 
      will get under way after spring breakup. Because of positive sampling 
      results from the Goldenville area, Anaconda optioned three mineral    
      licenses from local prospectors (Press Release dated December 11,     
      2012) and now controls a 4-kilometer strike length of the Goldenville 
      iron formation.                                                       
                                                                            
      Trenching has also been completed in the Pine Cove North area. Three  
      trenches exposed shear-related, strongly silicified and iron-         
      carbonitized mafic volcanic rocks locally containing disseminated     
      pyrite. These altered zones are anomalous in gold over exposed trench 
      lengths of greater than 30 meters with assay values up to 430 ppb over
      one meter channel intervals.                                          
                                                                            
      Additional work is planned for both the Pine Cove North and           
      Goldenville areas. A regional airborne magnetic survey is planned and 
      it is anticipated that the magnetic data will outline structural      
      breaks (faults) that when combined with the soil geochemical data will
      help identify trenching and diamond-drilling targets.                 
                                                                            
   2. Romeo and Juliet Bulk Sample: The Romeo and Juliet prospect is a gold-
      bearing quartz vein system located 1.5 kilometers northwest of the    
      Pine Cove mine. The veins were discovered in 1988 and have been       
      trenched and tested by 18 shallow diamond-drill holes. The veins      
      contain very fine, free gold making sampling a challenge ("nugget     
      effect") as historic chip and channel samples returned quite variable 
      assay values including 1.15 grams per tonne gold over 6 metres from   
      the Romeo zone up to 23 grams per tonne over 1.0 metre from the Juliet
      zone. In 1993, a 10-tonne "mini" bulk sample was collected from the   
      Juliet zone and 3,035 kilograms were processed returning a head grade 
      of 36.68 grams per tonne gold (this data is historic in nature and has
      not been verified by the Company). In August 2012, 24 grab samples    
      were collected from the Juliet zone and assay results ranged from a   
      low of 10 parts-per-billion gold up to 130.7 grams per tonne gold. In 
      the late fall of 2012 Anaconda extracted a 1,000-tonne bulk sample    
      from the Juliet zone and stockpiled the broken quartz vein material at
      the Pine Cove mine whe
re it was crushed. Samples have been selected   
      from the stockpile and submitted for assaying followed by             
      metallurgical testing.                                                

 
All Company generated samples were submitted by Anaconda personnel to
Eastern Analytical Laboratory in Springdale, Newfoundland for assay. 
The information in this press release has been reviewed and approved
by David Evans, P. Geo., with Silvertip Exploration Consultants Inc.,
a "Qualified Person" under National Instrument 43-101. 
ABOUT ANACONDA 
Headquartered in Toronto, Canada, Anaconda is a growth-oriented, gold
mining and exploration company with a producing asset located on the
Baie Verte Peninsula in Newfoundland, Canada called the Pine Cove
mine. 
FORWARD-LOOKING STATEMENTS 
This document contains or refers to forward-looking information. Such
forward-looking information includes, among other things, statements
regarding targets, estimates and/or assumptions in respect of future
production, mine development costs, unit costs, capital costs, timing
of commencement of operations and future economic, market and other
conditions, and is based on current expectations that involve a
number of business risks and uncertainties. Factors that could cause
actual results to differ materially from any forward-looking
statement include, but are not limited to: the final approval of the
private placement by the Toronto Stock Exchange; the grade and
recovery of ore which is mined varying from estimates; capital and
operating costs varying significantly from estimates; inflation;
changes in exchange rates; fluctuations in commodity prices; delays
in the development of the any project caused by unavailability of
equipment, labour or supplies, climatic conditions or otherwise;
termination or revision of any debt financing; failure to raise
additional funds required to finance the completion of a project; and
other factors. Additionally, forward-looking statements look into the
future and provide an opinion as to the effect of certain events and
trends on the business. Forward-looking statements may include words
such as "plans", "may", "estimates", "expects", "indicates",
"targeting", "potential" and similar expressions. These
forward-looking statements, including statements regarding Anaconda's
beliefs in the potential mineralization, are based on current
expectations and entail various risks and uncertainties.
Forward-looking statements are subject to significant risks and
uncertainties and other factors that could cause actual results to
differ materially from expected results. Readers should not place
undue reliance on forward-looking statements. These forward-looking
statements are made as of the date hereof and we assume no
responsibility to update them or revise them to reflect new events or
circumstances, except as required by law.
Contacts:
Anaconda Mining Inc.
Dustin Angelo
President and CEO
(647) 260-1248
dangelo@anacondamining.com
www.anacondamining.com 
ProConsul Capital Ltd.
Andreas Curkovic
Investor Relations
(416) 577-9927
acurkovic@proconsulcapital.com
 
 
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