Vancouver — Despite an 87% rise in revenues, Crystallex International (KRY-T) saw its earnings cut in half to $420,000, or 1 per share, in the first quarter of 2001.
Sales surged to $14.9 million, up from $7.9 million for the first quarter of 2000. Operating income doubled to $3.5 million from $1.7 million.
“As our revenues continue to build and as our balance sheet grows even stronger, we will explore other opportunities to further develop and improve our existing operations and to acquire high-potential gold mining properties which will increase the value of Crystallex for its shareholders,” says Marc Oppenheimer, the company’s CEO.
Gold production in the quarter ended March 31 tallied 25,882 oz. This was a 44% jump from the 18,006 oz. produced during last year’s first quarter. Cash costs to produce 1 oz. gold came in at US$236.
Driving both increased production and higher operating costs was the company’s launch of the open-pit La Victoria mine in Venezuela. Operating expenses in the recent quarter hit $11.4 million, compared with $6.2 million in the corresponding period last year. Upgrades to the Revemin mill and lower grades at the company’s San Gregorio operation also contributed to the increased costs.
During the quarter, Crystallex completed its takeover of the El Callao Gold Mining properties in Venezuela. In April, the company began operations at its La Victoria open pit. Ore at the new mine is being processed through Crystallex’s Revemin mill, which increased its capacity to 1,500 tonnes per day from the previous 1,150 tonnes.
La Victoria contains probable reserves of 3 million tonnes grading 3.03 grams gold per tonne, based on a cutoff grade of 1 gram per tonne and a gold price of $325 per oz. The deposit also hosts indicated resources of 5.1 million tonnes averaging 3.15 grams gold and inferred resources of 8.6 million tonnes grading 3.2 grams.
Crystallex plans to launch a 10,000-metre drill program aimed at converting the resources at La Victoria into reserves.
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