SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 6-K
Report of Foreign Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the Month of December, 1999 Commission File Number: 001-12003
MERIDIAN GOLD INC.
(Name of Registrant)
9670 Gateway Drive, Suite 200
Reno, Nevada 89511
(Address of Principal Executive Offices)
Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F.
Form 20-F [ ] Form 40-F [X]
Indicate by check mark whether the registrant by furnishing the information
contained in this form is also thereby furnishing the information to the SEC
pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes [X] No [ ]
Meridian Gold Inc. [LOGO OF MERIDIAN GOLD INC.
9670 Gateway Drive APPEARS HERE]
Reno, Nevada 89511
Phone: 775-850-3777
Fax: 775-850-3733
<PAGE>
MERIDIAN GOLD REPORTS FOURTH QUARTER AND FULL YEAR 1999 RESULTS
(All dollar amounts in U.S. currency)
Reno, Nevada, February 23, 1999 - Meridian Gold Inc. today reported fourth
quarter gold production of 70,086 ounces at a cash cost of $133 per ounce. For
the full year, the Company produced 241,661 ounces of gold at an average cash
cost of $163 per ounce, outperforming expectations as both Jerritt Canyon and
Beartrack improved their efficiency. For Beartrack, 1999's full-year production
level set records, both for the mine and for the State of Idaho. Cash costs at
Beartrack for the quarter and the year set mine records as well, at $102 and
$140 per ounce, respectively.
The Company recognized a fourth quarter loss of $1.3 million, or $0.03 per
share, which included a charge of approximately $5.7 million relating to an
increase in the Company's reclamation liability for the Royal Mountain King
mine. This compares to last year's fourth quarter loss of $20.7 million, or
$0.28 per share, which included a non-cash charge of $19.8 million taken as an
impairment of the Beartrack mine based on the depressed gold market.
At the end of the year, Meridian Gold's cash balance was $20.8 million. During
the year, the company drew only $30 million of its $50 million credit facility
with Standard Bank of London, for use in the construction of the El Penon mine
in northern Chile. The El Penon mine was completed on time and on budget with
pre-commercial startup occurring on September 1, 1999.
Fourth Quarter Results
Sales for the quarter were $24.9 million, versus $21.3 million in the fourth
quarter of 1998, due to increased production levels. Realized gold prices
averaged $336 per ounce in the fourth quarter, versus $340 per ounce in the
prior year's quarter. During the quarter, the Company recognized $2.9 million in
put option revenue. Cash production costs in the fourth quarter were $133 per
ounce, versus $210 per ounce in 1998.
At Beartrack, gold production in the fourth quarter was 38,667 ounces, with cash
costs of $102 per ounce. This compares to fourth quarter 1998 production of
31,594 ounces at a cash cost of $209 per ounce. The lower 1999 cash costs
reflect a significant improvement in mining efficiency and an increase in grades
and production. Mining will be completed at Beartrack in the first quarter of
2000. Processing of the heap leach pads will continue throughout 2000, with
anticipated production of approximately 60,000 ounces at a cash cost of about
$155 per ounce.
At Jerritt Canyon, the Company's share of production in the fourth quarter was
31,419 ounces of gold, versus 25,705 in the prior year's quarter. Cash costs
were lower, at $171 per ounce versus $211 per ounce, primarily as a result of
higher mill feed grades from the Dash open pit ore.
Exploration spending in the fourth quarter was $2.2 million, compared to $3.8
million in the fourth quarter of 1998.
<PAGE>
Results for the Full Year
For the full year 1999, the Company recorded a loss of $13.7 million, or $0.19
per share, compared to a loss of $39.2 million or $0.53 per share for the full
year 1998.
Sales for the full year, including put option revenues, were $71.2 million
versus $65.7 million in 1998. Gold production was higher, at 241,661 ounces
versus 214,640 ounces, while the average realized gold price fell to $295 per
ounce from $307 per ounce. Exploration spending for the full year decreased to
$10.2 million from $13.1 million in 1998.
El Penon Mine Update
El Penon met the targets of its startup period, which ran from September 1, 1999
to December 31, 1999. Gold production was 20,500 ounces, mostly obtained by
processing lower grade open pit ores. All operating costs and revenues during
this period were capitalized. Commercial production began on January 1, 2000 and
the mine was officially inaugurated on January 21, 2000 at a ceremony attended
by the President of the Republic of Chile, His Excellency Eduardo Frei Ruiz
Tagle.
2000 Outlook
Meridian expects to produce approximately 410,000 ounces from its operations in
2000. Meridian expects to generate its first annual profit as an independent
entity in 2000. Exploration spending of $10.5 million has been budgeted for
2000, with approximately $3.1 million of this earmarked for El Penon and $3.5
million slated for Jerritt Canyon. Additionally, Barrick Gold Corporation plans
drilling and development expenditures of about $2.7 million at the Rossi
property as part of their earn-in requirement under the terms of the joint
venture agreement.
Date of Annual and Special Meeting
Meridian Gold's Annual and Special Meeting of Shareholders will be held at 4:00
p.m. on Tuesday, May 2, 2000 at the TSE Conference Centre located on street
level of The Exchange Tower, 130 King Street West (NE corner of King and York
Streets), Toronto, Canada (business attire required).
The Record Date has been set at March 14, 1999. The Company's 1999 Annual Report
and Proxy Circular will be mailed to shareholders on or about March 24, 1999.
Publication of Reserves and Resources
Meridian is planning to publish year-end 1999 reserves and resources later in
the first quarter.
Meridian Gold Inc. is a growth gold business with its common shares traded on
The Toronto Stock Exchange (MNG) and the New York Stock Exchange (MDG).
- -----------------------------------
Safe Harbor Statement under the United States Private Securities Litigation
Reform Act of 1995: Statements in this release that are forward-looking
statements are subject to various risks and uncertainties concerning the
specific factors identified above and in the corporation's periodic filings with
the Ontario Securities Commission and the U.S. Securities Exchange Commission.
Such information contained herein represents management's best judgment as of
the date hereof based on information currently available. The corporation does
not intend to update this information and disclaims any legal liability to the
contrary.
For further information, please visit our website at www.meridiangold.com, or
contact:
Wayne M. Hubert Tel: (775) 850-3730
Investor Relations Fax: (775) 850-3733
Meridian Gold Inc. E-mail: [email protected]
<PAGE>
Meridian Gold Inc.
Consolidated Condensed Statement of Operations
(in US$ millions, except per share data)
<TABLE>
Three Months
Ended December 31 Full Year
------------------ -------------------
1999 1998 1999 1998
<S> <C> <C> <C> <C>
Sales $ 24.9 $ 21.3 $ 71.2 $ 65.7
Costs and expenses
Cost of sales 18.3 15.4 53.0 49.0
Depreciation, depletion & amortization 5.4 4.7 18.9 22.1
Exploration costs 2.2 3.8 10.2 13.1
Selling, general and administrative
expenses 1.1 2.4 5.0 7.2
Other operating income (0.9) (3.6) (0.9) (3.6)
Impairment of mineral properties --- 19.8 --- 19.8
--- - ---- --- ----
Total costs and expenses 26.1 42.5 86.2 107.6
---- ---- ---- -----
Operating loss (1.2) (21.2) (15.0) (41.9)
Interest income 0.3 0.5 1.7 2.7
Gain (loss) on sale of assets (0.4) --- (0.4) ---
----- --- ----- ---
Net loss (1) $ (1.3) $ (20.7) $ (13.7) $ (39.2)
======= ======== ======== ========
Loss per common share $(0.03) $(0.28) $ (0.19) $ (0.53)
======= ======= ======== ========
Weighted average common shares outstanding 73.7 73.6 73.7 73.6
======= ======= ======== ========
</TABLE>
- -----------------------------------
(1)In the fourth quarter of 1998, the Company recognized a $19.8 million
non-cash charge relating to the Beartrack mine, reflecting the continued
depressed gold market.
<PAGE>
Meridian Gold Inc.
Operating Data
<TABLE>
Three Months
Ended December 31 Full Year
--------------------- ----------------------
1999 1998 1999 1998
<S> <C> <C> <C> <C>
Beartrack Mine
Gold production - heap leach (ounces) 38,667 31,594 132,726 110,289
Tonnes mined (thousands)
Ore 1,089 996 4,671 4,088
Waste 755 1,679 3,511 7,163
------ ------ ------ ------
Total 1,844 2,675 8,182 11,251
Average heap leach grade (grams / tonne) 1.10 0.86 1.10 0.80
Cash cost of production / ounce $ 102 $ 209 $ 140 $ 220
Jerritt Canyon Joint Venture
Gold production (Meridian Gold's 30% share, ounces)
Milling 31,419 25,705 108,935 104,351
Tonnes mined (100%, thousands)
Ore 358 303 1,238 897
Waste 667 3,270 7,777 13,954
------ ------ ------ ------
Total 1,025 3,573 9,015 14,851
Mill tonnes processed (100%, thousands) 382 352 1,461 1,348
Average mill ore grade (grams / tonne) 9.43 7.95 8.60 8.71
Mill recoveries 90.8% 94.1% 91.0% 90.9%
Cash cost of production / ounce $ 171 $ 211 $ 191 $ 187
Totals
Ounces of gold produced 70,086 57,299 241,661 214,640
Ounces of gold sold 74,344 62,203 242,413 212,947
Average realized price / ounce $ 336 $ 340 $ 295 $ 307
Cash cost of production / ounce $ 133 $ 210 $ 163 $ 204
</TABLE>
The calculation of cash costs of production conforms to the standards
recommended by the Gold Institute.
<PAGE>
Meridian Gold Inc.
Consolidated Condensed Balance Sheets
(in US$ millions)
<TABLE>
December 31 December 31
1999 1998
<S> <C> <C>
Assets
Current Assets
Cash and cash equivalents $ 20.8 $ 34.1
Trade and other receivables 5.1 8.1
Inventories 8.7 6.3
Other current assets 0.9 1.5
----- -----
Total current assets 35.6 50.0
----- -----
Property, plant and equipment, net 102.9 57.5
Other assets 3.0 2.6
----- -----
Total assets $ 141.5 $ 110.1
======= =======
Liabilities and Shareholders' Equity
Current Liabilities
Current portion of long-term debt $ 12.0 $ ---
Accounts payable, trade and other 5.4 3.9
Accrued and other liabilities 17.1 9.6
----- -----
Total current liabilities 34.6 13.5
----- -----
Long-term debt, net of current portion 18.0 ---
Other long-term liabilities 28.5 23.1
Shareholders' equity 60.4 73.5
----- -----
Total liabilities and shareholders' equity $ 141.5 $ 110.1
======= =======
</TABLE>
<PAGE>
Meridian Gold Inc.
Consolidated Condensed Statement of Cash Flows
(in US$ millions)
<TABLE>
Three Months
Ended December 31 Full Year
-------------------- ------------------
1999 1998 1999 1998
<S> <C> <C> <C> <C>
Net loss $ (1.3) $ (20.7) $ (13.7) $ (39.2)
Provision for depreciation, depletion and
amortization 5.4 4.8 18.9 22.2
Gain (loss) on sale of assets (0.4) --- 0.5 ---
Impairment of mineral properties --- 19.8 --- 19.8
Provision for reclamation, net of costs incurred
6.0 --- 6.8 1.0
Accrued pension cost 0.4 --- 0.3 ---
Changes in assets and liabilities, net (10.5) (5.9) 8.3 ---
------ ------ ------ ------
Net cash provided by (used in) operating
activities (0.4) (2.0) 21.1 3.8
------ ------ ------ ------
Cash flows from investing activities
Capital spending (6.8) (14.9) (64.9) (23.7)
Disposal of PP&E 0.2 0.1 0.3 0.1
------ ------ ------ ------
Net cash used in investing activities (6.6) (14.8) (64.6) (23.6)
------ ------ ------ ------
Cash flows from financing activities
Proceeds from long-term borrowings 2.1 30.0 0.1
Proceeds from sale of common stock 0.6 0.1 0.8 (0.5)
Repayment of long-term debt --- --- (0.5) ---
Redemption of preferred stock --- --- (0.1) ---
------ ------ ------ ------
Net cash provided by (used in) financing
activities 2.7 0.1 30.2 (0.4)
------ ------ ------ ------
Increase (decrease) in cash and cash
equivalents (4.3) (16.7) (13.3) (20.2)
Cash and cash equivalents, beginning
of period 25.1 50.8 34.1 54.3
------ ------ ------ ------
Cash and cash equivalents, end of period $ 20.8 $ 34.1 $ 20.8 $ 34.1
======= ======= ======= =======
</TABLE>
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Date: December 31, 1999 MERIDIAN GOLD INC.
By: /s/ Brian J. Kennedy
--------------------
Brian J. Kennedy
President and Chief Executive Officer
