McEwen Mining’s operations in Mexico suffered as the consolidated production in 2017 lowered to 46,694 gold equivalent ounces in FY17 from 55,265 gold equivalent ounces in FY16. The 7 percent shortfall is attributed to a mechanical crusher failure last July and an increase in exploration spending in accordance to the operator’s growth plans.
The Canadian operator reported that its cash investments and precious metals increased in FY17 to US$68.1 million from US$58.8 million FY16, while working capital fell to US$49.2 million from US$58 million in FY16. The company experienced a consolidated net loss of US$10.6 million for FY17 compared to the US$21.1 million that was registered in FY16, amounting for a US$0.3 loss per share.
In 2017, US$5.6 million was invested in near-mine and district scale exploration while the budget for 2018 is US$1.1 million. Rob McEwen, Chairman and Founder of McEwen Mining explained the financial setback corresponded to the fact that “during 2017 we invested in our future growth.”
Nevertheless, to date the company has cash, investments and precious metals of US$60 million and no debt. The net cash flow for FY17 decreased to US$15.4 million compared to US$25.2 million in FY16. “We have stepped up our exploration, advanced our growth pipeline and funded the push for long lead time capital assets to ready ourselves for a timely started production at gold bar. As a result of these developments we are reporting a loss for the year,” explained McEwen. “Entering 2018, we remain debt free.”