Primero Mining Incurs Net Loss of $106.9 Million for 2015

Primero Mining Corp. (TSX:P,NYSE:PPP) released its financial results for Q4 2015, as well as 2015 as a whole, commenting that its annual revenue came in at $291.3 million, up 6 percent from 2014. As a result, its operating cash flow before changes in working capital rose by 13 percent from 2014, hitting $83.2 million.
Other highlights are as follows:

• Costs Controlled: All-in sustaining costs³ of $972 per ounce decreased by 20% from 2014 and were well below the Company’s 2015 guidance range of $1,030 to $1,060 per ounce. All-in sustaining costs are expected to drop a further 10% in 2016, to between $850 to $900 per gold ounce.

• Convertible Debentures to be Repaid in Cash: Primero ended 2015 with $120.6 million of total liquidity, which included $45.6 million in cash and $75.0 million available in an undrawn line of credit, significantly increased from the December 31, 2014 total liquidity position of $62.4 million. The Company announced on February 10, 2016⁴ its intention to repay in cash the outstanding $48.1 million of its 6.5% convertible debentures plus $1.6 million of associated interest on their maturity date of March 31, 2016.

• Earnings Impacted by Impairment: The Company incurred a net loss of $106.9 million ($0.66 per share) including $104.0 million in impairment charges in 2015, compared to a net loss of $224.4 million ($1.48 per share) including $209.0 million in impairment charges in 2014. Adjusted net income was $6.6 million ($0.04 per share) for 2015, compared to adjusted net income of $5.4 million ($0.04 per share) for 2014.

• Capital Expenditures Reduced But Not Restrictive in 2016: Primero has narrowed its 2016 focus to core capital expenditures related to advancing the existing underground mining operations at San Dimas and Black Fox, and as a result the Company expects capital expenditures in 2016 of $82.3 million including capitalized exploration costs of $18.4 million.

Ernest Mast, president and CEO of Primero, commented:

Primero’s strong focus on reducing costs, while continuing to invest in profitable operations is evident in our 2015 results. We achieved industry low all-in sustaining costs of $680 per ounce at our platform San Dimas mine while significantly reducing the all-in sustaining costs at the Black Fox mine by 19% from 2014, to $1,163 per ounce. We were also successful at reducing our corporate G&A expense with the closure of two satellite offices. Though Primero has had a volatile start to 2016 in the equity markets, our mines in Mexico and Canada continue to operate uninterrupted with anticipated further efficiency gains anticipated in 2016. We are aggressively defending the claim initiated by the Mexican tax authority seeking to nullify the APA. We look forward to demonstrating strong returns for our shareholders in 2016 by delivering production increases and maintaining a low cost structure with a focus on disciplined capital allocation and generating strong cash flow.

Click here to read the full Primero Mining Corp. (TSX:P,NYSE:PPP) press release.