Bay Street News

Asanko Gold Reports Q3 2018 Results

VANCOUVER, British Columbia, Nov. 08, 2018 (GLOBE NEWSWIRE) — Asanko Gold Inc. (“Asanko” or the “Company”) (TSX, NYSE American: AKG) reports its third quarter (“Q3”) 2018 operating and financial results. On October 17, 2018 the Company released its Q3 2018 production and revenue results for the Asanko Gold Mine, (“AGM”), located in Ghana, West Africa.  The AGM is a 50:50 joint venture (“JV”) with Gold Fields Ltd (JSE, NYSE: GFI) which is managed and operated by Asanko. All amounts are in US dollars unless otherwise stated.

The Company will host a conference call and webcast today, Thursday, November 8th at 9am Eastern Time, further details below.

Q3 2018 Highlights of the JV (100% basis):

Q3 2018 Asanko Consolidated Highlights:

Commenting on the results Peter Breese, President and CEO, said: “At the end of July we completed our JV transaction with Gold Fields and transitioned to managers and operators of the Asanko Gold Mine.  The timing of the completion of the transaction is reflected in our financial statements where we changed to equity accounting from August 1, 2018 for our interest in the JV as joint owners. The proceeds from the JV transaction were used to repay the Red Kite debt in full and we are now a debt-free company.

The mine delivered its third consecutive quarter of strong operational results, with Nkran back at steady-state operations for the full quarter, following completion of the Eastern portion of the Cut 2 pushback, and the mill continuing to outperform against its throughput design of 5Mtpa.

AISC1 continued to decrease quarter on quarter to $971, which is towards the lower end of H2 2018 cost guidance, despite the impact of a recent change in Ghanaian VAT levies, equating to approximately $20/oz, that were implemented during the quarter. Although the average realized gold price was around $88/oz weaker than the prior quarter at $1,198/oz, all-in sustaining margins for the mine remained strong at $227/oz.

As we enter the final quarter of the year, with production of 163,329 ounces and AISC1 of $1,072 year to date, the mine is well positioned to meet the top end of 2018 guidance of 200,000-220,000 ounces at AISC1 of $1,050-$1,150.

The development of the Esaase mine is progressing to plan. We have commenced site operations with bush clearing and grade control drilling. As part of our pre-production risk mitigation strategy, we will mine a bulk sample of ore during Q4 2018 and commercially test the sample through the mill.  The JV partners are expected to make an investment decision during Q4 2018 on whether to proceed with a mining and trucking operation which, if approved, would commence in Q1 2019.”

This news release should be read in conjunction with Asanko’s Management Discussion and Analysis and the Unaudited Condensed Consolidated Interim Financial Statements for the three and nine months ended September 30, 2018, which are available at www.asanko.com and filed on SEDAR.

Key Operating and Financial Highlights

Asanko Gold Mine (100% Basis)   Q3 2018     Q2 2018     Q3 2017
Waste mined (‘000t)   9,084     9,814     7,339
Ore mined (‘000t)   1,730     945     1,181
Strip ratio (W:O)   5.3:1     10.4:1     6.2:1
Average gold grade mined (g/t)   1.4     1.5     1.8
Mining costs ($/t mined)   3.63     3.65     3.35
Ore treated (‘000t)   1,299     1,374     862
Gold feed grade (g/t)   1.6     1.4     1.9
Gold recovery (%)   94     94     94
Processing costs ($/t treated)   11.26     9.95     12.94
Gold production (oz)   61,599     53,501     49,293
Gold sales (oz)   65,267     51,785     50,241
Average realized gold price ($/oz)   1,198     1,286     1,265
Operating cash costs1 ($/oz)   743     582     485
Total cash costs1 ($/oz)   803     646     549
All-in sustaining costs1 ($/oz)   971     1,068     975
All-in sustaining margin1 ($/oz)   227     218     290
All-in sustaining margin1 ($m)   14.8     11.3     14.6
Revenue ($m)   78.4     66.8     63.7
Income from mine operations ($m)   0.6     16.1     17.9
Net income (loss) after tax ($m)   (128.8)     3.5     8.1
Adjusted net income (loss) after tax1 ($m)   (2.1)     3.5     8.1
Cash provided by operating activities   21.1     18.4     42.7
       
Consolidated Results for Asanko Gold Inc.      
Revenue ($m)   30.7     66.8     63.5
Production costs, including royalties ($m)   21.7     33.8     28.0
Income (loss) from mine operations ($m)   (2.7)     16.1     17.9
Share of net earnings related to JV ($m)   0.3        
Net income (loss) attributable to common shareholders ($m)   (0.3)     (142.3)     4.2
Net income (loss) per share attributable
to common shareholders
  ($0.00)     ($0.63)     $0.02
Adjusted net income (loss) attributable to common shareholders1 ($m)   (1.6)     2.3     4.2
Adjusted net income (loss) per share attributable to common shareholders1   ($0.01)     $0.01     $0.02
Adjusted EBITDA1 ($m)   13.3     28.1     31.8
Attributable all-in sustaining costs1 ($/oz)   997     1,068     975
Attributable all-in sustaining margin1 ($/oz)   201     218     290
Attributable all-in sustaining margin1 ($m)   8.7     11.3     14.6

Q3 2018 Operating Results of the AGM (100% basis)

Q3 2018 Financial Performance of the AGM (100% basis)

Q3 2018 Corporate Developments

Q3 Key Consolidated Financial Information for Asanko Gold Inc.

2018 Guidance and Outlook

The Asanko Gold Mine is on track to meet the top end of its 2018 guidance of 200,000 – 220,000 ounces at AISC1 of $1,050-$1,150 for 2018, with production of 163,329 ounces at AISC1 of $1,072 for the year to date.

In H2 2018, with the Nkran Cut 2 pushback yielding steady-state levels of ore production, the AGM is expected to achieve production and cost guidance of 110,000-120,000 ounces at AISC1 $950-$1,050.

Development of a fourth deposit at the Asanko Gold Mine, the large greenfields deposit Esaase, has started with a pre-production program underway in preparation of commencing mining operations. This program includes an extensive core relogging and infill drilling exercise to refine the Mineral Resource Estimate and update the life of mine plan, which is expected to be published in H1 2019.  In addition, a bulk sample will be mined in Q4 2018 to confirm previous co-leaching test work results and will feed into updated Esaase pit designs and performance expectations. The JV partners are expected to make an investment decision in Q4 2018 regarding a mining and trucking operation at the greenfield Esaase deposit, part of the AGM, with mining operations expected to commence in Q1 2019.

The JV partners continue to review the longer-term ore transportation and development options for Esaase and expect to update the market in H1 2019.

Notes:
1 Non-GAAP Performance Measures
The Company has included certain non-GAAP performance measures in this press release, including working capital, operating cash costs, total cash costs, all-in sustaining costs per ounce of gold produced, all-in sustaining margin, adjusted net income attributable to common shareholders, adjusted net income per common share and adjusted EBITDA. These non-GAAP performance measures do not have any standardized meaning. Accordingly, these performance measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. Refer to the Non-GAAP Measures section of Asanko’s Management Discussion and Analysis for an explanation of these measures and reconciliations to the Company’s reported financial results in accordance with IFRS.

Qualified Person Statement
Frederik Fourie, Asanko Senior Mining Engineer (Pr.Eng) is the Asanko Qualified Person, as defined by Canadian National Instrument 43-101 (Standards of Mineral Disclosure), who has approved the preparation of the technical contents of this news release.

Q3 2018 Operating & Financial Results Conference Call & Webcast – 9am ET on November 8, 2018

US/Canada Toll Free:   800 771 6781

UK Toll Free:   0800 496 0830

International:   +1 212 231 2913

Webcast:

Please click on the link:  https://cc.callinfo.com/r/1olxigpk29h4v&eom

Replay:

A recorded playback will be available approximately two hours after the call until December 8, 2018:

US/Canada Toll Free:   800 558 5253

UK Toll Free:   0800 692 0831

International:   +1 416 626 4100

Passcode:  21895203

Enquiries:
For further information please visit: www.asanko.com, email: info@asanko.com or contact:

Alex Buck – Manager, Investor and Media Relations
Toll-Free (N.America): 1-855-246-7341
Telephone: +44-7932-740-452
Email: alex.buck@asanko.com

Andrew J. Ramcharan – SVP, Corporate Development and Investor Relations
Toll-Free (N.America): 1-855-246-7341
Telephone: +1 647 309 5130
Email: andrew.ramcharan@asanko.com

About Asanko Gold Inc.
Asanko’s vision is to become a mid-tier gold mining company that maximizes value for all its stakeholders. The Company’s flagship project, located in Ghana, West Africa, is the jointly owned Asanko Gold Mine with Gold Fields Ltd, which Asanko manages and operates. Asanko is managed by highly skilled and successful technical, operational and financial professionals. The Company is strongly committed to the highest standards for environmental management, social responsibility, and health and safety for its employees and neighbouring communities.

Forward-Looking and other Cautionary Information
This release includes certain statements that may be deemed “forward-looking statements”. All statements in this release, other than statements of historical facts, that address estimated resource quantities, grades and contained metals, possible future mining, exploration and development activities, are forward-looking statements. Although the Company believes the forward-looking statements are based on reasonable assumptions, such statements should not be in any way construed as guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices for metals, the conclusions of detailed feasibility and technical analyses, the timely renewal of key permits, lower than expected grades and quantities of resources, mining rates and recovery rates and the lack of availability of necessary capital, which may not be available to the Company on terms acceptable to it or at all. The Company is subject to the specific risks inherent in the mining business as well as general economic and business conditions. For more information on the Company, investors should review the Company’s most recent AIF and 40-F filings, available under the Company’s profile on SEDAR at www.sedar.com and EDGAR at www.sec.gov.

Neither Toronto Stock Exchange nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this release.