Vancouver, British Columbia, November 12, 2013 – Elgin Mining Inc. (“Elgin Mining” or the “Company”) (TSX: ELG and ELG.WT) reports its financial and operational results for the three and nine months ended September 30, 2013. Elgin Mining owns and operates the Björkdal gold mine (“Björkdal”) in Sweden, and holds the past-producing Lupin gold mine (“Lupin”) and the Ulu gold property in Nunavut, Canada. All figures are in Canadian dollars ($ or CAD) unless otherwise indicated.
A copy of the Company’s financial statements and Management’s Discussion and Analysis can be viewed on the Company’s website at www.elginmining.com or on SEDAR at www.sedar.com.
Third Quarter 2013 Highlights
Gold production of 10,751 gold ounces;
Cash cost per gold ounce sold1 of US$1,119;
Cash cost per gold ounce produced of US$1,127;
Cash used in operating activities was $0.4 million;
Net loss of $3.1 million which included $0.6 million in Lupin care and maintenance and $0.6 million in impairment charges recognized in the quarter;
Basic and diluted loss per share of $0.02;
Completed a private placement on September 13, 2013 for gross proceeds of $2.95 million by issuing 24.6 million units at $0.12 per unit. Each unit consisted of one common share of the Company and one-half of a warrant with each whole warrant exercisable into one common share at a price of $0.20 for a period of two years;
Finalized an 18-month bridge loan facility for $5.0 million (“Bridge Loan”) on September 25, 2013 with Sprott Resource Lending Partnership. The Bridge Loan bears interest at 10% per annum payable monthly with principal due at maturity on March 25, 2015;
Further progress on the transition from contractor to owner mining in the underground at the Björkdal mine with the receipt of all remaining equipment deliveries, and the on-going orientation and training of the new underground mining crews. The current mining contractor remained on-site to the end of October 2013 to ensure an orderly transition and as of November 1, all mining and development are being executed by Björkdal employees;
Commenced procedures in the open pit to reduce cost per tonne moved and ore tonne costs which had been negatively affected by a change in drill and blast patterns. This transition commenced in late July and costs were reduced during the quarter and we fully expect to be at or close to historical operating costs per tonne moved by mid-November;
Completed a preliminary 2014 mine plan for the Björkdal mine based on a mix of ore from the open pit, underground and stockpiles that will maintain all-in cash costs below US$1,200 per ounce during this current period of lower gold prices; and
Implemented further cost cutting measures at head office and at Lupin where site support activities have been reduced to minimum levels and all site expenditures have been deferred into later years wherever possible.