Avino Provides 2012 Year End Summary and Outlook for 2013

Avino Provides 2012 Year End Summary and Outlook for 2013 
VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 02/05/13 -- Avino
Silver & Gold Mines Ltd. (TSX VENTURE:ASM)(NYSE
MKT:ASM)(FRANKFURT:GV6) ("Avino" or the "Company") is pleased to
report the following summary of significant events from 2012 and
outlook for 2013. 
Avino Achieves Production 
On October 1st, 2012, the Company achieved production at the San
Gonzalo Mine. This is a significant milestone for the Company
reflecting 7 years of planning, determination and hard work from our
teams in Canada and Mexico.  
2012 Production Highlights 


 
--  Metal production increased for the year by 42% over 2011 to 253,451
    silver equivalent ounces (Calculated)(i) 
--  Silver production for the year increased by 44% over 2011 to 191,635
    silver ounces (Calculated) 
--  Gold production for the year increased by 80% over 2011 to 1,236 gold
    ounces (Calculated) 

 
Approximate production numbers from each quarter of 2012 are
presented below:(ii) 


 
                          Feed   Concen-                 Au oz              
                      Material     trate        Ag oz Produced      Ag Eq oz
          Source of  Processed  Produced     Produced  (calcu-   Produced(i)
Quarter   Mill Feed   (tonnes)  (tonnes) (calculated)   lated)  (calculated)
                                                                            
Q1         Historic                                                         
                 ET                                                         
         Stockpiles     14,600       176       17,875      220        28,875
Q2         Historic                                                         
                 ET                                                         
         Stockpiles     16,900       134       14,129      180        23,129
Q3         Historic                                                         
                 ET                                                         
         Stockpiles     20,015       323       31,024      381        50,074
Subtotal   Historic                                                         
                 ET                                                         
         Stockpiles     51,515       633       63,028      781  102,078(iii)
Q4              San                                                         
            Gonzalo                                                         
               Mine     19,538       538      128,607      455       151,373
Total                   71,053     1,171      191,635    1,236       253,451
                                                                            
(i) Silver equivalent ounces in 2011 and 2012 were calculated using prices  
 of US$1,700 per oz and US$34.00 per oz for gold and silver respectively and
 applied to the recovered metal content of the concentrates that were       
 produced from the ET stockpiles and San Gonzalo mine.                      
                                                                            
(ii) Approximate production numbers, have not been reconciled to shipped    
 tonnage.                                                                   
                                                                            
(iii) In Quarters 1 through 3 the Company produced and sold all of the bulk 
 concentrate generated from processing old ET stockpiles. During the first 3
 quarters of 2012, the Company was considered an exploration stage company, 
 therefore the proceeds from the sale of this concentrate was charged as a  
 reduction of mineral properties and exploration costs. On October 1, 2012, 
 the Company transitioned to commercial production with respect to the San  
 Gonzalo mine, therefore revenues and related costs will be reflected in the
 statement of comprehensive income and loss going forward. The revenues and 
 costs for Q4 will be reflected in the annual audited financial statements. 

 
"2012 was a very exciting and productive year for Avino and we hope
to report even better news in 2013. We have made, and will continue
to make, improvements that we believe will have a positive impact
going forward. As we concentrate on improving efficiencies of the
operations, our focus in 2013 will be to reduce costs, increase
production at San Gonzalo and prepare for development and production
at Avino's main mine in 2014." - David Wolfin, President & CEO. 
During the first three quarters of 2012, Avino processed material
left over from past mining of the main Avino vein. The old ET
stockpiles had been left on the surface in various locations across
the property making delivery for processing easy and cost efficient.
The stockpiles provided Avino an opportunity to generate cash flow
while tuning the mill and continuing underground advancement and
mining at San Gonzalo. 
On October 1st, Avino began processing high-grade material from the
San Gonzalo Mine with plans to accommodate a sustained 250 tonne per
day ("tpd") operation. As expected, production numbers surged and in
the fourth quarter more silver equivalent was produced than in the
first three-quarters combined; results were also consistent with the
data from the 2010 bulk sample program. During the fourth quarter,
silver and gold feed grades from the San Gonzalo Mine averaged 258
g/t and 1.04 g/t respectively; recoveries averaged 79% for silver and
69% for gold. 
Avino expects grades and recoveries will improve at lower levels
because silver assay results from the 2007 drilling at levels 4 and 5
of the mine produced a number of core intercept samples (down hole)
greater than 1,000 g/t Ag, some reaching as high as 5,265 g/t Ag,
over 0.65 metres. In addition, independently verified metallurgical
test work on the deeper level core samples yielded recoveries of
89%-90% for silver and 92%-93% for gold.  
SG Underground Advancement 
After the completion of the bulk sample taken in the spring of 2011,
which was comprised of material from levels 1 and 2, mine advancement
at San Gonzalo has been ongoing. In 2012, the remaining material from
the stopes on level 2 was mined and brought to the surface. Level 3
was the main focus of mining activities with two stopes having been
developed and partially extracted by the end of the year. By the end
of July, a decline from level 3 to level 4 had been completed and
work on the ramp to level 5 had commenced. Subsequent drifting on
level 4 produced samples that assayed as high as 14,768 g/t Ag over
0.4 metres or 1,380 g/t over 2.22 metres. These assay results
represented the highest grade Avino has sampled at San Gonzalo in 6
years of exploration. By year-end, level 5 had nearly been reached
and stope development on level 4 was underway. Underground
advancement for 2012 totalled 2,558 metres. 
Main Avino Mine - Royalty Agreement  
In February 2012, a new long-term royalty agreement was signed to
grant Avino mining rights to the main Avino vein. Mining activities
were suspended on the Avino vein in 2001 due to low metals prices and
the closure of a key smelter. Avino plans to re-open the old Avino
mine once de-watering and all necessary modifications to the
processing plant have been completed. When operations resume, Avino
will use its existing 1,000 tpd circuit to process the material.
Between 1998 and 2000, leading up to the mines closure, annual output
averaged 933,240 oz/Ag, 7,537 oz/Au and 9,305,347 lbs/Cu. When the
mine re-opens in 2014, Avino expects to process similar material at a
similar rate as it did prior to closure in 2001 and expects similar
output levels.  
Exploration - Avino Mine 
Shortly after signing the new royalty agreement, the Company embarked
on an exploration program to further define remaining resources. The
2012 drill program, which totalled 3,263 metres through 9 holes was
intended to form the basis for a current mineral resource estimate
below level 12 to be included in a forthcoming NI 43-101 compliant
resource report. The results were consistent with results from
drilling conducted between 2006 and 2008 and demonstrated the
thickness and consistency of the vein. Full results from the drill
program can be viewed in Avino's third quarter MD&A on Avino's
website or on SEDAR. 
Preliminary Economic Assessment - Oxide Tailings Resource 
In July 2012, the Company filed an independent updated technical
report on the Avino property focused on the oxide tailings resource.
The report outlined a 1,370 tpd cyanide heap leach operation using
two metal price scenarios. Details of a preliminary economic
assessment are outlined below: 
Metal Production 


 
---------------------------------------------------
Total Tonnes to Mill                      2,340,000
---------------------------------------------------
Annual Tonnes to Mill                       500,000
---------------------------------------------------
Mine Life                                   5 years
---------------------------------------------------
Average Silver Grade (g/t)                91.30 g/t
---------------------------------------------------
Average Gold Grade (g/t)                   0.54 g/t
---------------------------------------------------
Total Silver Production (oz)              4,814,000
---------------------------------------------------
Total Gold Production (oz)                   31,000
---------------------------------------------------
Average Annual Silver Production (oz)     1,028,860
---------------------------------------------------
Average Annual Gold Production (oz)           6,580
---------------------------------------------------

 
Economics 


 
----------------------------------------------------------------------------
                                              Base Case     Spot Price Case 
----------------------------------------------------------------------------
Gold Value (US$)                         $        1,256      $        1,622 
----------------------------------------------------------------------------
Silver Value (US$)                       $        20.38      $        28.36 
----------------------------------------------------------------------------
IRR                                                54.4%                 92%
----------------------------------------------------------------------------
Payback period                                1.6 years           1.1 years 
----------------------------------------------------------------------------
NPV (US$'000) 8% discount rate           $       38,647      $       74,186 
----------------------------------------------------------------------------

 
A preliminary economic assessment should not be considered a
prefeasibility or feasibility study, as the economics and technical
viability of the Project have not been demonstrated at this time. The
above preliminary economic assessment is preliminary in nature and
includes inferred mineral resources that are considered too
speculative geologically to apply economic considerations that would
allow for categorization as mineral reserves. Furthermore, there is
no certainty that the preliminary economic assessment will be
realized. Mineral resources that are not mineral reserves do not have
demonstrated economic viability. 
Data disclosed in July 25th, 2012 technical report by Tetra Tech: A
Technical Report on the Avino Property. Michael O'Brian, M.Sc.,
Pr.Sci.Nat, FGSSA, FAusIIM, FSAIIM, Hassan Ghaffari, P.Eng., Jacques
Ouellet, P.Eng., Ph.D., Monica Danon-Schaffer, Ph.D, P.Eng., Sabry
Abdel Hafex, Ph.D., P.Eng and Wayne Stoyko, P.Eng., are the Qualified
Persons, as defined under National Instrument 43-101, who supervised
and are responsible for the Techncial Report on the Avino Property. 
Management/Personnel 
In 2012, the operation at Avino grew considerably. Key appointments
were made including the promotions of Mr. Carlos Rodriguez, Mine
Manager to Chief Operating Officer and Mr. Malcolm Davidson, Senior
Accountant to Chief Financial Officer. Avino also re-hired Mr.
Gerardo Mejia as the mine superintendent. Mr. Mejia is very familiar
with the underground workings at the Avino Mine as he was
superintendent at Avino before the operation ceased in 2001. Two new
experienced field geologists were also added to help with both
surface and underground exploration. 
Property Option Agreements 
During the year, Avino entered into two separate option agreements.
Avino optioned its Laberinto property in Durango, Mexico to Endeavour
Silver Corp. (See news release dated July 31, 2012) and its Eagle
property located in the prolific Keno Hill Mining district in the
Yukon Territory, Canada to Benz Capital Corp. (see news release dated
January 6, 2012) Avino feels that both properties are of merit and
hold significant potential. 
Financing  
In December, the Company entered into a credit facility with
Caterpillar Finance for up to US $5 million. The financing will help
Avino advance its current operations at San Gonzalo and reopen the
old Avino Mine (for more information please see the news release
dated December 20, 2012). With the credit facility in place, the
Company has acquired several key pieces of mining equipment
including: a new Caterpillar 420F Backhoe loader, Caterpillar R1600
Scoop tram and an Oldenburg underground rock drill. This equipment
represents roughly one third of the credit facility.  
Outlook  
The focus for 2013 is to improve and strengthen operational
efficiency at the Avino operation and reconfigure the plant in
anticipation of higher throughput for 2014.  
Key objectives for 2013 include: 


 
1.  Increase cash flow from mine operations by reducing costs and improving
    operational efficiency; 
    
2.  Aggressively drive the development of the main Avino Mine with the goal
    of production in 2014; 
    
3.  Resume exploration drilling across the property; 
    
4.  Review acquisition opportunities; and 
    
5.  Publish a new NI 43-101 complaint resource estimate covering the San
    Gonzalo and Avino Mines. 

 
Qualified Person(s) 
Avino's projects are under the supervision of Chris Sampson, P.Eng,
BSc, ARSM Avino consultant and Mr. Jasman Yee, P.Eng, Avino director,
who are both qualified persons within the context of National
Instrument 43-101. Both have reviewed and approved the technical data
in this news release. 
ON BEHALF OF THE BOARD 
David Wolfin, President & CEO 
Safe Harbor Statement - This news release contains "forward-looking
information" and "forward-looking statements" (together, the
"forward-looking statements") within the meaning of applicable
securities laws and the United States Private Securities Litigation
Reform Act of 1995, including our belief as to the extent and timing
of various studies including the PEA, and exploration results, the
potential tonnage, grades and content of deposits, timing and
establishment and extent of resources estimates. These
forward-looking statements are made as of the date of this news
release and the dates of technical reports, as applicable. Readers
are cautioned not to place undue reliance on forward-looking
statements, as there can be no assurance that the future
circumstances, outcomes or results anticipated in or implied by such
forward-looking statements will occur or that plans, intentions or
expectations upon which the forward-looking statements are based will
occur. While we have based these forward-looking statements on our
expectations about future events as at the date that such statements
were prepared, the statements are not a guarantee that such future
events will occur and are subject to risks, uncertainties,
assumptions and other factors which could cause events or outcomes to
differ materially from those expressed or implied by such
forward-looking statements. 
Such factors and assumptions include, among others, the effects of
general economic conditions, the price of gold, silver and copper,
changing foreign exchange rates and actions by government
authorities, uncertainties associated with legal proceedings and
negotiations and misjudgments in the course of preparing
forward-looking information. In addition, there are known and unknown
risk factors which could cause our actual results, performance or
achievements to differ materially from any future results,
performance or achievements expressed or implied by the
forward-looking statements. Known risk factors include risks
associated with project development; the need for additional
financing; operational risks associated with mining and mineral
processing; fluctuations in metal prices; title matters;
uncertainties and risks related to carrying on business in foreign
countries; environmental liability claims and insurance; reliance on
key personnel; the potential for conflicts of interest among certain
of our officers, directors or promoters of with certain other
projects; the absence of dividends; currency fluctuations;
competition; dilution; the volatility of the our common share price
and volume; tax consequences to U.S. investors; and other risks and
uncertainties. Although we have attempted to identify important
factors that could cause actual actions, events or results to differ
materially from those described in forward-looking statements, there
may be other factors that cause actions, events or results not to be
as anticipated, estimated or intended. There can be no assurance that
forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not place
undue reliance on forward-looking statements. We are under no
obligation to update or alter any forward-looking statements except
as required under applicable securities laws. 
Cautionary Note to United States Investors - The information
contained herein and incorporated by reference herein has been
prepared in accordance with the requirements of Canadian securities
laws, which differ from the requirements of United States securities
laws. In particular, the term "resource" does not equate to the term
"reserve". The Securities Exchange Commission's (the "SEC")
disclosure standards normally do not permit the inclusion of
information concerning "measured mineral resources", "indicated
mineral resources" or "inferred mineral resources" or other
descriptions of the amount of mineralization in mineral deposits that
do not constitute "reserves" by SEC standards, unless such
information is required to be disclosed by the law of the Company's
jurisdiction of incorporation or of a jurisdiction in which its
securities are traded. U.S. investors should also understand that
"inferred mineral resources" have a great amount of uncertainty as to
their existence and great uncertainty as to their economic and legal
feasibility. Disclosure of "contained ounces" is permitted disclosure
under Canadian regulations; however, the SEC normally only permits
issuers to report mineralization that does not constitute "reserves"
by SEC standards as in place tonnage and grade without reference to
unit measures. 
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. 
Contacts:
Avino Silver & Gold Mines Ltd.
David Wolfin
President & CEO
604.682.3701
604.682.3600 (FAX)
ir@avino.com
www.avino.com
 
 
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