Santa Fe Gold Reports 49% Increase in Revenues to $14.6 Million for 2013

Santa Fe Gold Reports 49% Increase in Revenues to $14.6 Million for 2013

ALBUQUERQUE, N.M.--(BUSINESS WIRE)-- Santa Fe Gold Corporation (OTCBB: SFEG) today announced financial results for its fiscal year ended June 30, 2013. Santa Fe Gold reported revenues of $14.6 million for the year ended June 30, 2013, which represents an increase of 49% over 2012. The Company's gross profit (or earnings from mining operations) decreased by 32% to $2.4 million in 2013. The full version of the financial statements and management's discussion and analysis can be viewed on the Company's website at www.santafegoldcorp.com or at www.sec.gov.

"We are pleased to be able to announce continued significant growth in revenues and continued positive earnings from mining operations despite lower metal prices," commented Pierce Carson, President and CEO. "We also are excited about our growth prospects for 2014. The recent developments at Summit are expected to contribute to higher grades and increased production in 2014."


2012 ANNUAL HIGHLIGHTS

  • 49% increase in revenues to a record $14.6 million.
  • 32% decrease in gross profit (earnings from mining operations) to $2.4 million.

OUTLOOK

For 2014, the Company expects to experience continued growth, in part due to the following positive developments:

  • Underground advancement has reached the upper part of the main Summit ore body. As a result, the Company is now in a position to access higher silver and gold grades.
  • Discussions are underway with mining contractors to increase tonnage production rates to 12,000 tons per month. Metal output in calendar 2014 is anticipated to increase substantially with increased tonnage production and higher grades from the main ore body.
  • An independent engineering assessment of the Ortiz gold project concludes the project could produce 874,000 ounces of gold from two open cut mines over an operating life ranging from 9 to 18 years depending on the development sequence employed. At a three-year moving average gold price of $1550 per ounce, revenues would total $1.35 billion and cash flows would approximate $350 million net of all costs including royalties, operating costs, taxes and capital expenses. Baseline environmental work is continuing in preparation for permit application.

About Santa Fe Gold

Santa Fe Gold is a U.S.-based mining enterprise with producing mining operations in Lordsburg, New Mexico, and exploration and development projects in southwestern New Mexico, north-central New Mexico and Arizona. Santa Fe controls: (i) the Summit mine and Lordsburg mill in southwestern New Mexico, which began commercial production in 2012; (ii) a substantial land position near the Lordsburg mill, comprising the core of the Lordsburg Mining District; (iii) the Mogollon gold-silver project, within trucking distance of the Lordsburg mill; (iv) the Ortiz gold property in north-central New Mexico; (v) the Black Canyon mica deposit near Phoenix, Arizona; and (vi) a deposit of micaceous iron oxide (MIO) in western Arizona. Santa Fe Gold intends to build a portfolio of high-quality, diversified mineral assets with an emphasis on precious metals.

To learn more about Santa Fe Gold, visit www.santafegoldcorp.com.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements and forward-looking information (collectively, "forward-looking statements") within the meaning of applicable US securities legislation. All statements, other than statements of historical fact, included herein are forward-looking statements. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Forward-looking statements are typically identified by words such as: believe, expect, anticipate, intend, estimate, postulate and similar expressions, or are those, which, by their nature, refer to future events. The Company cautions investors that any forward-looking statements by the Company are not guarantees of future results or performance, and that actual results may differ materially from those in forward-looking statements as a result of various factors, including, but not limited to, variations in the nature, quality and quantity of any mineral deposits that may be located, variations in the market price of any mineral products the Company may produce or plan to produce, the Company's inability to obtain any necessary permits, consents or authorizations required for its activities, the Company's inability to produce minerals from its properties successfully or profitably, to continue its projected growth, to raise the necessary capital or to be fully able to implement its business strategies, and other risks and uncertainties disclosed in the Company's Annual Report on Form 10-K for the year ended June 30, 2012 and its most recent quarterly reports filed with the United States Securities and Exchange Commission (the "SEC"), and other information released by the Company and filed with the appropriate regulatory agencies. All of the Company's US public disclosure filings may be accessed via www.sec.gov and readers are urged to review these materials.

See Accompanying Tables

The following information summarizes the financial condition of Santa Fe Gold Corporation at June 30, 2013, including its balance sheets for the twelve months ended June 30, 2013 and 2012, respectively, and its results of operations and cash flows for the twelve months ended June 30, 2013, 2012 and 2011, respectively. The summary data are taken from our audited financial statements contained in our annual reports on Form 10-K for the financial years ended June 30, 2013, 2012 and 2011 but do not include the footnotes and other information that is included in the complete financial statements. Readers are urged to review the Company's Form 10-K in its entirety, which can be found on the SEC's website atwww.sec.gov.

   

SANTA FE GOLD CORPORATION

CONSOLIDATED BALANCE SHEETS

 
 June 30, 
ASSETS 2013    2012 
CURRENT ASSETS:  
Cash and cash equivalents$115,094$614,385
Accounts receivable273,7972,442,399
Inventory241,214951,458
Marketable securities-48,776
Prepaid expenses and other current assets 457,377    329,466 
Total Current Assets 1,087,482    4,386,484 
MINERAL PROPERTIES 599,897    579,000 
PROPERTY, EQUIPMENT AND MINE DEVELOPMENT, net 21,726,196    24,139,166 
OTHER ASSETS:
Idle equipment, net1,223,5281,223,528
Restricted cash231,716231,716
Mogollon option costs761,914-
Deferred financing costs, net 323,348    1,102,070 
Total Other Assets 2,540,506    2,557,314 
Total Assets$25,954,081   $31,661,964 
 
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable$2,748,549$2,199,026
Accrued liabilities4,606,4092,505,785
Derivative instrument liabilities496,9201,026,765
Current portion, notes payable7,185,8779,931,468

Current portion, Senior subordinated convertible notes payable, net of
discount of $-0- and $5,564, respectively

-444,436
Current portion, capital leases-41,487
Completion guarantee payable 3,359,873    3,359,873 
Total Current Liabilities18,397,62819,508,840
LONG TERM LIABILITIES:
Convertible notes payable, net of discount of $60,482 and $-0-, respectively3,951,310-
Notes payable, net of current portion330,192936,996
Capital leases, net of current portion-3,545
Asset retirement obligation 167,746    159,048 
Total Liabilities 22,846,876    20,608,429 
STOCKHOLDERS' EQUITY:

Common stock, $.002 par value, 300,000,000 shares authorized; 117,599,598
and 111,143,684 shares issued and outstanding, respectively

235,199222,287
Additional paid in capital77,210,64974,846,754
Accumulated (deficit)(74,338,643)(63,966,224)
Accumulated other comprehensive (loss) -    (49,282)
Total Stockholders' Equity 3,107,205    11,053,535 
Total Liabilities and Equity$25,954,081   $31,661,964 
 
 
   

SANTA FE GOLD CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE (LOSS)

 
 For the Years Ended June 30, 
 2013    2012    2011 
    
SALES, Net$14,571,973   $9,762,054   $5,904,640 
 
OPERATING COSTS AND EXPENSES:
Costs applicable to sales12,185,2446,274,0333,180,105
Exploration and mine related costs2,012,785371,584309,399
General and administrative3,998,3923,710,9213,002,955
Depreciation and amortization4,149,0344,039,8752,322,736
Accretion of asset retirement obligation 8,698    9,812    - 
 22,354,153    14,406,225    8,815,195 
 
LOSS FROM OPERATIONS (7,782,180)   (4,644,171)   (2,910,555)
 
OTHER INCOME (EXPENSE):
Interest income-9,10811,645
Foreign currency translation440,449--
Miscellaneous income23,6085,328-
Other expense-(1,245,694)-
Gain on derivative instrument liabilities1,617,9876,568,5331,652,961
Accretion of discounts on notes payable(21,918)(1,066,843)(1,275,811)
Financing costs - commodity supply agreements(2,008,730)(1,709,472)(1,260,257)
Interest expense (2,641,635)   (2,136,470)   (835,076)
 (2,590,239)   424,490    (1,706,538)
 
LOSS BEFORE PROVISION FOR INCOME TAXES(10,372,419)(4,219,681)(4,617,093)
PROVISION FOR INCOME TAXES -    -    - 
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