Q4, 2010 Financial and Operating
Results Earnings increased 31%; Cash flow increased 40%
(all figures in United States dollars, unless otherwise
noted)
VANCOUVER, BC - Paul N. Wright, President and Chief Executive Officer of
Eldorado Gold Corporation, ("Eldorado" the "Company" or
"we") is pleased to report on the Company's financial and operational
results for the fourth quarter ended December 31, 2010. The Company reported
net income of $43.6 million, or $0.08 per share, and cash flow from operations
of $83.0 million or $0.15 per share for the fourth quarter ended December 31,
2010.
"We have operated to plan and are extremely pleased with our strong
performance. Our earnings increased 31% and our cash flow increased 40%
compared to Q4, 2009 " stated Paul N. Wright, President and Chief
Executive Officer of Eldorado. "Construction at both Efem�ukuru
and Eastern Dragon are progressing and we look forward to production from both
mines during 2011".
Q4 2010 Highlights
- Produced 148,374 ounces of
gold, an increase of 15% over Q4, 2009 at an average cash operating cost
of $418 per ounce (Total cash cost $460 per ounce)
- Sold 149,022 ounces of gold at
an average realized price of $1,373 per ounce; which generated revenue 42%
higher than Q4, 2009
- Reported earnings of $43.6
million ($0.08 per share) an increase of 31% over Q4, 2009
- Generated $83.0 million of cash
($0.15 per share) from operating activities before changes in non-cash
working capital an increase of 40% over Q4, 2009
- Trial mining operations at Vila
Nova continued with two shipments of iron ore completed in the quarter
- Underground pre-production
development at Efem�ukuru reached the Middle Ore
Shoot ore zone with production anticipated to begin in Q2, 2011
- Construction activities at
Eastern Dragon resumed during the quarter
Financial Results
Eldorado's consolidated net income for the fourth quarter of 2010 was $43.6
million or $0.08 per share compared to $33.3 million or $0.08 in the fourth
quarter of 2009. Net income for the twelve month period ended December 31, 2010
was $205.7 million or $0.38 per share, compared to $102.4 million or $0.26 per
share in the comparable period from 2009.
During the fourth quarter, we sold 149,022 ounces of gold at an average price
of $1,373 per ounce compared to 131,068 ounces of gold at an average price of
$1,103 per ounce in the fourth quarter of 2009.
Operating Performance
Kisladag
During the quarter we produced 59,815 ounces of gold
at a cash operating cost of $382 per ounce. We placed 2,021,057 tonnes of ore on the leach pad at an average grade of 1.00
gram per tonne of gold. We sold 59,741 ounces of
gold.
We continued our work on expansion of the circuit this quarter and began the
installation of two tertiary crushers. The new circuit will be tied into the
existing process in late February.
Jinfeng
During the quarter we produced 37,560 ounces of gold at cash operating cost of
$486 per ounce and we milled 387,710 tonnes of ore at
a grade of 3.81 grams per tonne. Ore mined from the
open pit was 387,701 tonnes and ore from the
underground totalled 110,818 tonnes.
We sold 38,282 ounces of gold.
We mined from the bottom of the open pit this quarter, which reduced waste
removal and increased production. We have now completed the current phase of
open pit mining, and will begin waste stripping in 2011.
Tanjianshan
At Tanjianshan we produced 30,710 ounces of gold at
cash operating cost of $349 per ounce. We milled a total of 244,867 tonnes of ore at an average grade of 4.59 grams per tonnes. We sold 30,710 ounces of gold.
White Mountain
During the quarter we produced 20,289 ounces of gold at a
cash operating cost of $498 per ounce and we processed 169,669 tonnes of ore at a grade of 4.06 grams per tonnes. We sold 20,289 ounces of gold
Vila Nova Iron Ore
During the quarter as part of trial mining Vila Nova
mined 163,920 tonnes of ore. One shipment of lump ore
totalling 45,442 wet metric tonnes
and the other shipment of sinter fines totalling
47,702 wet metric tonnes were sold into the Chinese
spot market for an average of $93.0 per tonne.
Development
Efem�ukuru
Construction of the tailings filtration and backfill plants continue on
schedule during the quarter. We are continuing with dry commissioning in the
main concentrator building and expect it to be complete in early 2011. We will
start wet commissioning when construction is complete and the power line is
energized (scheduled for early April). We finished the structures for the
administration building, the mine dry, the warehouse/maintenance shop and mine
canteen.
Preproduction development moved ahead on all three declines. The contractor's
advance rates have continued to improve as we gain experience with the
operation and ground conditions. The conveyor decline has now reached the level
of the crushing chamber and lateral development has begun. We have gained access
to the Middle Ore Shoot from the north ramp which allows us to evaluate the
ground conditions in the ore zone.
Eastern Dragon
We have made excellent progress at Eastern Dragon this
quarter as part of the winter work program. Despite severe weather civil
foundation and structural steel work continued on schedule.
Tocantinzinho
We will complete the prefeasibility study for Tocantinzinho
in the first quarter of 2011. We are evaluating capital and operating costs to
further identify opportunities to optimize the project. A significant portion
of the investment capital is for infrastructure, particularly for road access
and to install a dedicated power line. We have substantially increased the
level of detail for both engineering and estimating in these areas.
Perama Hill
There was no significant change in the status of the pre-environmental
assessment report which is currently being reviewed by the Ministry of
Environment. We continue to work with all levels of government to advance the
understanding of the project and its importance to the regional economy.
Exploration
Turkey
At Kisladag, 17 diamond drill holes were completed
during the quarter, focused on the western and southwestern margin of the
deposit. Significant gold values were intersected adjacent to a late-mineral
intrusion extending westward from the core of the deposit. The discovery of
ore-grade gold values in the basement schist here highlights the prospectively
of the relatively unexplored area west of the deposit. Adjacent to Kisladag at the Saya�ik prospect,
we completed five reverse circulation drill holes and two diamond drill holes,
targeting geophysical and geochemical anomalies.
Drilling programs were completed during the quarter at the Malatya-Hasancelebi (MH), Sizma, and AS
exploration projects. At the MH iron oxide copper gold prospect, six diamond
drill holes tested targets defined by soil and rock chip geochemistry,
alteration mapping, and geophysical survey data. At the Sizma
project (phyllite-hosted gold) we completed the 22 drillhole phase 1 exploration program this quarter. Several
drill holes intersected significant Au values over several tens of metres at shallow depths, which will be targeted at deeper
levels in 2011. At the AS porphyry prospect, we completed six drill holes on
new target areas defined by mapping, geochemical sampling and magnetic survey
programs. All intersected variable altered and mineralized rocks, including
zones of porphyry-style Cu, Mo, Au mineralization.
China
At Tanjianshan, we completed the final two drillholes of the 2010 resource drilling program on the 323
zone during the quarter. Geological modeling of the mineralized zones has
formed the basis for a preliminary resource estimate of approximately 160,000
ounces of inferred gold at an average grade of 2.75 g/t. The mineralized zone
remains open to the south, where one of the final drill holes of the season
intersected 11.6 g/t Au over 5.5 meters.
At Jinfeng, we continued our drilling programs at the
mine proper this quarter, at the Bannian prospect
located approximately 20 km southwest of the Jinfeng
mine, and at the Lintan prospect located immediately
north of the mine. Drilling programs at Bannian and Lintan targeted mineralized fault zones where previous
surface work identified structurally-controlled zones of high-grade gold. At
the Jinfeng mine, drilling focused on upgrading zones
of inferred resources.
Drilling this quarter at White Mountain we focused on the open down-dip and
along-strike extensions of the deposit, as well as early-stage targets at the
newly acquired Xiashiren Central exploration license
located 20km to the southeast. At White Mountain, high-grade mineralization was
intersected approximately 200 meters down-dip of the known deposit (24.7 meters
@ 8.7 g/t Au) possibly representing a second mineralized zone that is open
along strike and down dip. Seven diamond drill holes were completed at the Xiaoshiren prospect, testing for the source of the abundant
boulders of high-grade silicified breccia at the
prospect. Several drill holes intersected mineralized breccias zones, with the
most significant interval grading 7.8 g/t Au over 6.5 metres.
Brazil
At Tocantinzinho, drilling during the quarter was
divided between infill resource holes and condemnation holes. None of the condemnation
drill holes intersected significant mineralization. The infill drilling
constrained positions of lithologic and
mineralization boundaries in areas with low drillhole
density, and will allow us to convert inferred resources to indicated
resources. At the nearby Aqua Branca and Piranhas
projects, both held under option, fieldwork this quarter focused on geochemical
sampling programs aimed at defining auger and diamond drilling targets for
2011.
Eldorado is a gold producing, exploration and development company actively
growing businesses in Turkey, China, Brazil and Greece. We are one of the
lowest cost pure gold producers. With our international expertise in mining,
finance and project development, together with highly skilled and dedicated
staff, we believe that Eldorado is well positioned to grow in value as we
create and pursue new opportunities.
ON BEHALF OF
ELDORADO GOLD CORPORATION
"Paul N.
Wright"
Paul N. Wright
President and Chief Executive Officer
Eldorado will host a
conference call Friday, February 18, 2011 to discuss the 2010 Fourth Quarter
Financial and Operating Results at 11:30 a.m. ET (8:30 a.m. PT). You may
participate in the conference call by dialling
416-340-2216 in Toronto or 1-866-226-1792 toll free in North America and asking
for the Eldorado Conference Call with Chairperson: Paul Wright, President and
CEO of Eldorado Gold. The call will be available on Eldorado's website www.eldoradogold.com. A replay of the call will be
available until February 25, 2011 by dialling
416-695-5800 in Toronto or 1-800-408-3053 toll free in North America and
entering the Pass code 2583817.
Cautionary
Note Concerning Forward-Looking Statements
Certain of the statements
made herein may contain forward-looking statements or information within the
meaning of the United States Private Securities Litigation Reform Act of 1995
and applicable Canadian securities laws. Often, but not always, forward-looking
statements and forward-looking information can be identified by the use of
words such as "plans", "expects", "is expected",
"budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates", or
"believes" or the negatives thereof or variations of such words and phrases
or statements that certain actions, events or results "may",
"could", "would", "might" or "will" be
taken, occur or be achieved. Forward-looking statements or
information herein include, but are not limited to statements with respect to
the Company's Fourth Quarter Financial and Operating results and its
development and exploration projects.
Forward-looking statements
and forward-looking information by their nature are based on assumptions and
involve known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the Company to be
materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements or information. We have
made certain assumptions about the forward-looking statements and information
and even though our management believes that the assumptions made and the
expectations represented by such statements or information are reasonable,
there can be no assurance that the forward-looking statement or information
will prove to be accurate. Furthermore, should one or more of the risks,
uncertainties or other factors materialize, or should underlying assumptions
prove incorrect, actual results may vary materially from those described in
forward-looking statements or information. These risks, uncertainties and other
factors include, among others, the following: gold price volatility;
discrepancies between actual and estimated production, mineral reserves and
resources and metallurgical recoveries; mining operational and development
risk; litigation risks; regulatory restrictions, including environmental
regulatory restrictions and liability; risks of sovereign investment; currency
fluctuations; speculative nature of gold exploration; global economic climate;
dilution; share price volatility; competition; loss of key employees;
additional funding requirements; and defective title to mineral claims or
property, as well as those factors discussed in the sections entitled
"Forward-Looking Statements" and "Risk Factors" in the
Company's Annual Information Form & Form 40-F dated March 31, 2010.
There can be no assurance
that forward-looking statements or information will prove to be accurate, as
actual results and future events could differ materially from those anticipated
in such statements. Accordingly, you should not place undue reliance on the
forward-looking statements or information contained herein. Except as required
by law, we do not expect to update forward-looking statements and information
continually as conditions change and you are referred to the full discussion of
the Company's business contained in the Company's reports filed with the
securities regulatory authorities in Canada and the U.S.
Eldorado Gold Corporation's common shares trade on the Toronto Stock Exchange
(TSX: ELD) and the NYSE (NYSE: EGO). Eldorado's CDI trade on the Australian
Securities Exchange (ASX: EAU).
