2010 Production Objectives Achieved; Production Growth Strategy Gains Momentum
Highlights
-
Metal Production Targets for 2010 Achieved as Strong Quarterly Earnings
and Cash Flows Were Generated From the Company's Operations in Northern
Manitoba
- Lalor Mine Construction Advancing Well With First
Production Still Expected in Q2 2012 and Optimization Study Expected by
Early Q3 2011
- Two High Grade Gold/Copper Drill Intercepts at Lalor Lengthen the Down Plunge Extension of the Copper-Gold Zone to 750 Meters
-
With Norsemont Mining Inc. ("Norsemont") Acquisition Complete,
Optimization of the Feasibility Study for the Constancia Copper Project
Is Underway With Construction Expected to Commence by Q1 2012
-
Further High Grade Gold Drill Intercepts at Depth at the Back Forty
Project Continue to Point to the Potential for a High Grade Underground
Mineral Resource to Supplement the Large Near Surface Mineral Resource.
TORONTO, ONTARIO -- (MARKET WIRE) -- 03/09/11 --
HudBay Minerals Inc. ("HudBay", the "company") (TSX: HBM)(NYSE: HBM) today released its fourth quarter and year-end 2010 financial results. Net earnings increased to $24.5 million or $0.16 per share in the fourth quarter of 2010, compared to $7.2 million, or $0.05
per share, during the fourth quarter of 2009. Included in the fourth
quarter 2010 earnings was a foreign currency translation loss of $4.2 million before taxes or approximately $0.02
per share after tax. Earnings grew during the quarter due to higher
metal prices, only partly offset by lower sales volumes, a stronger
Canadian dollar, higher exploration expenses and taxes.
"Consistent and predictable performance across our operations enabled us to meet our production targets in 2010," said David Garofalo,
HudBay's president and chief executive officer. "We are poised to
continue advancing our strategic plan on a number of fronts in 2011.
Lalor remains on track to be our next big mine in Manitoba and the Constancia copper project in Peru
provides us with another significant leg of growth in one of the
world's best mining jurisdictions. Our growth pipeline is further
enhanced with the high grade copper project at Reed Lake and the advanced stage gold/zinc deposit at the Back Forty project in northern Michigan.
In 2011, we will focus on execution with an eye toward optimizing our
projects with an aggressive exploration program and adding more early
stage development projects to further enhance our long term growth
profile."
Strong Earnings Growth Demonstrates Superior Metals Price Leverage
During the fourth quarter of 2010, the company generated net earnings of $24.5 million or $0.16
per share, an improvement of more than 240% over the same period in
2009 as stronger metals prices were only partly offset by a temporary
buildup in unsold metals inventory, a stronger Canadian dollar,
increased exploration and higher taxes. Co-product cost per unit sold
remained low at $1.39 per pound copper, $345 per ounce gold and $0.87 per pound zinc.(1)
For the full year 2010, HudBay's earnings were $73.0 million or $0.48
per share, an improvement of more than 475% over 2009 (after adjusting
for gains on the sale of available for sale investments) due to similar
factors.
Fully Financed Growth with Strong Cash Flows and Excellent Liquidity
An improvement in operating cash flows(1) of 78% to $59.9 million in the fourth quarter together with the release of $57.1 million of restricted cash more than offset capital and strategic investments of $66.1 million. Our cash and cash equivalents balance stood at $901.7 million at the end of the fourth quarter, an increase of $50 million during the quarter.
Together with our unutilized credit lines, HudBay has available liquidity of $1.1 billion
and no debt. While the company believes that the Lalor and Constancia
projects can be fully financed from existing resources and future cash
flows, it expects to arrange additional debt financing at either the
corporate or project level to maintain optimum financial flexibility.
Lalor Construction on Track, Next Phase of Feasibility Optimization Due by Q3 2011
Development and site construction at the Lalor project are proceeding on
schedule. HudBay continued to make significant progress on the planned
3,200 meter access ramp at the Lalor project, advancing it 1,750 meters
from the Chisel North mine as at February 28, 2011. The
ramp is intended to extend to the base of the ventilation shaft that is
currently under development. The ventilation shaft is expected to be
completed in time to allow for initial ore production in the second
quarter of 2012.
Ground conditions on the ramp have been good and water intersections have been minimal since the first quarter of 2010. In January 2011,
HudBay completed the temporary ventilation exhaust, a 435 meter bored
raise, and plans to construct the main fresh air fan and heater system
in the summer of 2011 in preparation for the next heating season.
(1) Operating cash flow (before changes in non-cash working capital) and
co-product cash costs are considered non-GAAP measures. See the
reconciliation of these measures to GAAP at the end of this release.
Surface site construction has proceeded on several fronts. The access
road to the site is complete, the main surface exhaust raise site has
been cleared, and construction on the 6.1 meter diameter ventilation
raise has been started with civil work proceeding on the temporary hoist
and head frame arrangement and development of the pre-sink for the
shaft sinker.
All power poles for the site have been installed and the line wiring is
ongoing, with the temporary substation becoming operational at the end
of February. Water lines for process water and discharge water are being
placed and civil work on the pump stations is underway.
On the main site, construction is proceeding with the excavation of the
polishing pond and water treatment plant. Temporary construction
trailers have been brought in and are currently being installed.
Procurement and tendering are ongoing. The main production hoist and man
hoist have been ordered with the man hoist delivery expected in the
first quarter of 2011. The production shaft-sinking contract is expected
to be awarded imminently with contractor site mobilization expected
immediately thereafter and shaft sinking to commence by Q3 2011. HudBay
is continuing with its Lalor optimization study through the
metallurgical testing of the Lalor ores, which is focusing on gold
optimization. This includes variable testing on the primary grind, with
and without a regrind circuit, as well as optimization of the reagent
used and projected consumption.
Tradeoff studies undertaken by the company indicate that the Lalor
orebody will support the construction of a new concentrator adjacent to
the production shaft. HudBay is continuing to evaluate options for the
capacity and flowsheet of a new concentrator, and expects to be in a
position to make a decision on whether to proceed with a new
concentrator and announce the results of its optimization efforts early
in the third quarter of 2011.
"We remain on track to meet our target of first ore production from
Lalor in the second quarter of 2012," said Mr. Garofalo. "The ongoing
next phase of project feasibility optimization work at Lalor has the
potential to bring additional mineral resources into the mine plan,
while the incremental investment associated with a new concentrator
adjacent to the production shaft could lead to higher daily production
levels along with other benefits including reduced operating costs,
higher gold recoveries in the plant and further production rate
scalability."
Lalor Drilling Further Extends Copper-Gold Zone
HudBay also announced additional exploration results from its Lalor
project, which confirm the continuity of mineralization at the
copper-gold zone (please refer to the map on HudBay's website). Hole
DUB270W03 intersected 3.4 meters of 3.5% copper, 8.9 g/t gold and 27.1
g/t silver and is located between previously reported intersections
DUB270W01 (previously released December 13, 2010) and DUB270 (previously released June 10, 2010).
Hole DUB274 intersected the copper-gold zone 100 meters northeast of the
DUB270W01 intersection. The total downward plunge of the zone is now
over 750 meters. Hole DUB274 intersected 5.1 meters of 4.4% copper, 13.7
g/t gold and 19.8 g/t silver. These grades and the thicker nature of
this intersection support the inference that the zone pinches and
swells. Down hole geophysics indicate that the zone may be swinging back
to the east and testing is currently underway on the copper-gold zone
further down plunge about 100 meters from DUB274.
Three drills remain active on site at Lalor. In addition to the drilling
noted above, two other drills are on site, with one testing a Surface
Deep EM target located between the Chisel North mine and the Lalor
deposit, and the other drill testing a peripheral geophysical target
southwest and west of the known Lalor deposit at depth.
Lalor Drill Hole Results table
----------------------------------------------------------------------------
Drill Hole Length (m) Au (g/t) Ag (g/t) Cu (%) Zn (%)
DUB270W03 3.41 8.89 27.06 3.52 0.08
DUB274 5.07 13.67 19.81 4.41 0.19
----------------------------------------------------------------------------
(1) For additional information regarding the Lalor project please refer to
the NI 43-101 compliant Technical Report entitled "Lalor Deposit, Snow
Lake, Manitoba, Canada" filed on November 20, 2009 and the most recent
press release announcing Lalor drill results on December 13, 2010, both
of which are available at http://www.sedar.com/.
Constancia Optimization Timeline and Exploration Update Expected March 2011
On March 1, 2011, HudBay acquired 104,635,351 common
shares of Norsemont through the issuance of approximately 20.5 million
HudBay common shares and the payment of $119 million in cash and extended its take-over bid to holders of Norsemont common shares until March 15, 2011.
As a result, the company owns approximately 91% of Norsemont's issued
and outstanding shares (calculated on a fully-diluted basis). HudBay
intends to proceed with a second-stage compulsory acquisition
transaction to acquire the remaining common shares of Norsemont that it
does not already own or subsequently acquire before the expiry of the
take-over bid.
Norsemont filed an optimized technical report on February 21, 2011,
which outlined an increase in reserves using new long-term metal
pricing and increasing and sustaining production throughput in the
processing plant in the later years of the project.
The feasibility study contemplates an open pit mine feeding a processing
plant at up to 70,000 tonnes per day for the estimated 15.3 year mine
life. The average yearly metal production for the life of mine is
expected to be 85,000 tonnes of copper, 1,400 tonnes of molybdenum and
69 tonnes of silver. The capital cost of the project is estimated to be US$920 million with a life of mine average copper cost of US$0.93/lb.
HudBay is currently reviewing the work required to make a construction
decision to optimize and advance the Constancia project. This review
process is expected to be complete and a feasibility optimization and
exploration program and budget will be provided by the end of March 2011.
Constancia Project Mineral Reserve Estimate February 21, 2010 (1), (2)
----------------------------------------------------------------------------
Tonnes
Category (Millions) Au (g/t) Ag (g/t) Cu (%) Mo (g/t)
Proven 195 0.04 3.5 0.42 120
Probable 177 0.05 3.7 0.40 92
----------------------------------------------------------------------------
Total Reserves 372 0.05 3.6 0.43 105
----------------------------------------------------------------------------
(1) The Mineral Reserve for the FSO study is based on Net Smelter Return
("NSR") cut-off since project revenue is derived from copper,
molybdenum, silver and gold. For NSR evaluation, metal prices assumed
were Cu $2.25/lb, Mo $14.50/lb, Ag $14/oz and Au $1,000/oz while average
metal recovery to concentrates was Cu 89%, Mo 40%, Ag 80% to Cu
concentrate and Au 60% to Cu concentrate.
(2) For additional information regarding Constancia please refer to the N1
43-101 Technical Report entitled "Norsemont Mining Constancia Project
Technical Report" dated February 21, 2011, filed by Norsemont and
available at http://www.sedar.com/.
Drilling at Back Forty Yields More High Grade Gold Intercepts at Depth
On March 3, 2011, Aquila Resources Inc.
("Aquila") announced additional drill results from the Back Forty
project, which included 12 meters of 15.29 g/t gold and 66.49 g/t silver
in drill hole LK-484.
The high grade gold intercept from LK-484 occurs approximately 250
meters down dip of the previously modeled resource and is located
approximately 32 meters northeast of a 6.23 meter, 6.39 g/t gold
intercept in LK-479 (see the HudBay news release dated October 15, 2010 for more details).
HudBay was scheduled to complete a pre-feasibility study on the Back
Forty project in the third quarter of 2011 in preparation for submitting
a permit application by year end. Continued future exploration success
at depth may modify the scope of the project and delay the proposed
milestones to enable full optimization of the mine plan. Because of the
nature of the permitting process in Michigan,
it is important for HudBay to understand what the mine plan entails and
its proposed footprint prior to submitting permit applications. Given
the current exploration focus to expand the underground resource at Back
Forty, HudBay will continue to focus on this in the immediate future to
develop a solid understanding of the optimal mine plan before beginning
the permitting process.
The Back Forty project in the Upper Peninsula of Michigan
is an advanced stage exploration project delineating a zinc and
gold-rich volcanogenic massive sulfide deposit under a joint venture
between HudBay and Aquila.
Aquila owns a 49% interest in the project and HudBay owns a 51%
interest, which HudBay can increase to 65% by funding and completing a
feasibility study and permitting applications.
HudBay is the operator of the Back Forty Joint Venture and Aquila
continues to provide technical support. Currently, three drills remain
on site at the Back Forty Project. Two drills are focused on the exploration of the deep gold zone intersected in LK-484 referenced above.
A third drill has been mobilized to test some high ranking electromagnetic targets within a kilometer east of the deposit.
For additional detail on the Back Forty project, please refer to the NI 43-101 resource statement which was published on November 29, 2010 in "Technical Report, Back Forty Deposit, Menominee County, Michigan, USA" filed by Aquila and available on www.sedar.com.
Reed Lake Resource Estimate Expected to be Released in March 2011
HudBay recently completed an infill drilling program at its 70% owned Reed Lake project with an NI 43-101 resource estimate expected to be released in March 2011.
The results of the infill drilling program are generally in line with
the company's expectations. HudBay will then begin an economic
evaluation to determine the viability of the Reed Lake deposit. A production decision is expected by the fourth quarter of 2011. Given the near surface nature of the Reed Lake copper deposit, its advantageous location adjacent to a provincial highway and its proximity to the company's Flin Flon complex, production could commence by late 2012 or early 2013 with a relatively small capital investment.
Key Financial Results
----------------------------------------------------------------------------
($000s except per share Three Months Ended
amounts) December 31 Year Ended December 31
----------------------------------------------------
2010 2009 2010 2009
----------------------------------------------------------------------------
Revenue 183,280 166,673 778,818 720,722
----------------------------------------------------------------------------
Earnings before tax and
non controlling
interest 41,606 9,620 158,105 141,468
----------------------------------------------------------------------------
Net earnings
attributable to
shareholders 24,493 7,171 72,985 112,440
----------------------------------------------------------------------------
EBITDA(1),(2) 71,745 40,571 280,240 143,339
----------------------------------------------------------------------------
Operating cash
flow(1),(3) 59,927 33,624 199,850 124,512
----------------------------------------------------------------------------
Basic and diluted EPS(4) 0.16 0.05 0.48 0.73
----------------------------------------------------------------------------
Operating cash flow per
share(1),(3) $ 0.40 $ 0.22 $ 1.33 $ 0.81
----------------------------------------------------------------------------
Cash and cash
equivalents 901,693 886,814 901,693 886,814
----------------------------------------------------------------------------
Total assets 2,173,086 2,032,686 2,173,086 2,032,686
----------------------------------------------------------------------------
(1) EBITDA, operating cash flow and operating cash flow per share are
considered non-GAAP measures. See the reconciliation of these measures
to GAAP at the end of this release.
(2) EBITDA represents earnings before interest expense, taxes, depreciation
and amortization, gain/loss on derivative instruments, exploration and
interest and other income.
(3) Before changes in non-cash working capital.
(4) Earnings per share.
For additional information on HudBay's fourth quarter and Year-end 2010
financial results, please refer to the Fourth Quarter and Year-end 2010
Supplemental Disclosure document on the Investors section (Financial
Reports page) of HudBay's website at www.hudbayminerals.com.
Non-GAAP Measures
Detailed operating expenses, EBITDA, operating cash flow before changes
in non-cash working capital, operating cash flow per share, cash cost
per pound of zinc sold and co-product cash costs per unit sold are
included in this news release because these measures are performance
indicators that we use internally to monitor performance. We use these
measures to assess how well we are performing compared to plan and to
assess the overall effectiveness and efficiency of mining, processing
and refining operations. We believe that the inclusion of these measures
in the news release helps an investor to assess performance "through
the eyes of management" and that certain investors use these measures to
assess our performance. These measures do not have a meaning presented
by GAAP and should not be considered in isolation or as a substitute for
measures prepared in accordance with GAAP. These
measures are not necessarily indicative of operating profit or cash flow
from operations as determined under GAAP. Other companies may calculate
these measures differently.
EBITDA
The following table presents our calculation of EBITDA for the three months and year ended December 31, 2010 and December 31, 2009.
----------------------------------------------------------------------------
Three Months Ended Year Ended
-----------------------------------------------
Dec 31 Dec 31 Dec 31 Dec 31
($000s) 2010 2009 2010 2009
----------------------------------------------------------------------------
Earnings before tax and non-
controlling interest 41,606 9,620 158,105 141,468
Adjustments:
Depreciation and amortization 20,781 27,653 103,399 100,731
Exploration 10,954 3,994 29,822 7,609
Interest and other income (2,206) (1,151) (8,323) (107,386)
Loss (gain) on derivative
instruments 610 455 (2,763) 917
-----------------------------------------------
EBITDA 71,745 40,571 280,240 143,339
----------------------------------------------------------------------------
Operating cash flow before changes in non-cash working capital and operating cash flow per share
The following table presents our calculations of operating cash flow
before changes in non-cash working capital and operating cash flow per
share for the three months and year ended December 31, 2010 and December 31, 2009.
----------------------------------------------------------------------------
Three Months Ended Year Ended
-------------------------------------------------------
($000s except share
and per share Dec 31 Dec 31 Dec 31 Dec 31
amounts) 2010 2009 2010 2009
----------------------------------------------------------------------------
Cash provided by
operating
activities, per
financial statements 64,864 39,632 255,590 106,194
Adjustments:
Changes in non-cash
working capital (4,937) (6,008) (55,740) 18,318
----------------------------------------------------------------------------
Operating cash flow
before changes in
non-cash working
capital 59,927 33,624 199,850 124,512
Weighted average
shares outstanding 149,219,230 153,973,547 150,636,835 153,460,823
----------------------------------------------------------------------------
Operating cash flow
per share $ 0.40 $ 0.22 $ 1.33 $ 0.81
----------------------------------------------------------------------------
Cash cost per pound of zinc sold
HudBay's cash cost per pound of zinc sold, net of by-product credits, for the fourth quarter of 2010 was negative US$0.42
per pound, excluding costs and sales related to Balmat, HMI Nickel and
corporate activities, as calculated in the following table.
----------------------------------------------------------------------------
Three Months Ended Year Ended
---------------------------------------------------
Dec 31 Dec 31 Dec 31 Dec 31
($000s except as noted) 2010 2009 2010 2009
----------------------------------------------------------------------------
Operating expenses 95,301 105,939 451,106 506,275
General and
administrative
expenses(1) 2,019 1,914 8,139 6,501
---------------------------------------------------
97,320 107,853 459,245 512,776
Exclude amounts related
to Balmat and HMI Nickel (4,772) (5,071) (18,592) (15,318)
---------------------------------------------------
92,548 102,782 440,653 497,458
Less by-product
credits(2) (117,767) (96,398) (533,398) (505,938)
---------------------------------------------------
Cash cost net of by-
products (25,219) 6,384 (92,745) (8,480)
Exchange rate (US $1 to
C$)(3) 1.013 1.056 1.030 1.142
---------------------------------------------------
Cash cost net of by-
products US (24,895) US 6,045 US (90,044) US (7,426)
Zinc sales (000's lbs.) 59,966 64,593 231,355 240,897
---------------------------------------------------
Cash cost per pound of
zinc sold, net of by-
product credits in US
$/lb. US (0.42) US 0.09 US (0.39) US (0.03)
----------------------------------------------------------------------------
(1) General and administrative expenses relate to HBMS entity only.
(2) By-product credits include revenues from sale of copper, gold, silver,
the value added by converting zinc to zinc oxide, and by-product sales.
(3) Weighted average exchange rate for sales during the period.
Cash costs net of by-product credits have been restated to exclude
corporate activities in order to be better comparable with costs
disclosed by comparable mining companies. For the fourth quarter of
2010, HudBay's cash cost per pound of zinc sold was negative US$0.42, a net decrease of US$0.51 from the same period in 2009, and for the 2010 year was negative US$0.39, a net decrease of US$0.36
from 2009. The decrease in cost per pound was due primarily to higher
by-product copper, gold and silver credits arising from higher prices.
HudBay's calculation of cash cost per pound of zinc sold is
significantly influenced by by-product metal prices, which may fluctuate
going forward.
Co-product cash costs per unit sold
Commencing in the third quarter of 2010, we introduced co-product cash
costs as a new non GAAP measure. We believe that these costs serve as
meaningful indicators for investors to evaluate our operations.
Costs for 2009 have not been included for comparability because they
included substantial purchased copper concentrate volumes together with
the cost of the smelter and refinery, which were shut down in 2010.
Whereas cash costs net of by-product credits present the cash costs of a
single metal, assuming that all other metals are by-products of the
given metal, co-product cash costs present a cost of producing each of
our primary metals, copper, zinc and gold, based on an allocation of
costs among the metals. Costs that can be readily associated with a
specific metal are allocated to that metal. Mining and milling costs for
our Trout Lake
and 777 mines are allocated proportionately based on the value of the
contained metals at prevailing metals prices. Operating overhead
expenses and general and administrative expenses (in both cases,
excluding costs not related to our HBMS operations) are generally
allocated equally between zinc and copper with some further cost
allocation to gold. In order to present a cost per finished unit
sold, we also add to these costs third party treatment and refining
costs, which are deducted from revenue in our financial statements.
Zinc oxide production is treated as a by-product of zinc production, so
the costs of our Zochem operation are allocated to zinc operating
expenses and zinc oxide revenues are deducted from total zinc cash
costs. Similarly, silver production is treated as a by-product of gold
production. Other miscellaneous revenues are allocated among zinc,
copper and gold in the same manner as general and administrative costs.
While the impact of fluctuating metals prices is expected to be less
significant on co-product cash costs than it is on by-product cash
costs, changes in relative metals prices may cause our reported cash
costs to vary substantially over time, irrespective of our operational
results. Significant management judgement is also required in
determining how costs should be allocated among metals. Caution should
also be exercised in using co-product cash costs to evaluate the
profitability of a particular metal, as the profitability of our
polymetallic mines is dependent on the production of all of our
principal metals.
Our future co-product cash costs may change significantly from those reported for the three months and year ended December 31, 2010 as we complete the transition from copper smelting and refining to copper concentrate sales.
Three Months Ended December 31, 2010
----------------------------------------------------------------------------
Non-
($000s except as allocated
noted) Copper Zinc Gold costs Total
----------------------------------------------------------------------------
Operating expenses 21,776 59,308 9,402 4,815 95,301
General and
administrative(1) 807 807 404 7,000 9,018
Treatment and
refining costs(2) 4,549 - 1,121 - 5,670
-------------------------------------------------------
27,132 60,115 10,927 11,815
Zinc oxide and by-
product revenues (756) (7,655) (4,796)
------------------------------------
Co-product costs 26,376 52,460 6,131
Sales volume(3) 18,943 59,965 17,779
------------------------------------
Co-product cash costs
per unit(4) sold $ 1.39 $ 0.87 $ 345
----------------------------------------------------------------------------
(1) Allocation of general and administrative costs to copper, zinc and gold
production excluding corporate and other non-production related costs.
(2) Treatment and refining costs are deducted from revenue.
(3) Copper and zinc sales volumes denoted in 000's pounds, and gold sales
volumes denoted in troy oz.
(4) Copper and zinc costs are per pound and the gold cost is per troy oz.
Year Ended December 31, 2010
----------------------------------------------------------------------------
Non-
($000s except as allocated
noted) Copper Zinc Gold costs Total
----------------------------------------------------------------------------
Operating expenses 141,458 240,605 50,409 18,634 451,106
General and
administrative(1) 3,255 3,255 1,628 19,994 28,132
Treatment and
refining costs(2) 10,854 - 2,041 - 12,895
-------------------------------------------------------
155,567 243,860 54,078 38,628
Zinc oxide and by-
product revenues (3,403) (36,282) (22,130)
------------------------------------
Co-product costs 152,164 207,578 31,948
Sales volume(3) 104,062 231,356 83,481
------------------------------------
Co-product cash costs
per unit(4)sold $ 1.46 $ 0.90 $ 383
----------------------------------------------------------------------------
(1) Allocation of general and administrative costs to copper, zinc and gold
production excluding corporate and other non-production related costs.
(2) Treatment and refining costs are deducted from revenue.
(3) Copper and zinc sales volumes denoted in 000's pounds, and gold sales
volumes denoted in troy oz.
(4) Copper and zinc costs are per pound and the gold cost is per troy oz.
Please also see HudBay's consolidated financial statements and related
notes together with Management's Discussion and Analysis of Operations
and Financial Condition for the year ended December 31, 2010, which are available under HudBay's SEDAR profile at www.sedar.com and HudBay's website at www.hudbayminerals.com. All amounts are in thousands of Canadian dollars unless otherwise noted.
Qualified Person
The technical and scientific information included in this news release was prepared under the supervision of Cashel Meagher, Vice President, Exploration of HudBay, a "qualified person" for the purposes of National Instrument 43-101.
Lalor Drill Hole Location
----------------------------------------------------------------------------
LENGTH
DRILL HOLE FROM TO (m) EAST NORTH
----------------------------------------------------------------------------
DUB270W03 1308.84 1312.25 3.41 426,686 6,081,822
DUB274 1389.69 1394.76 5.07 426,764 6,081,954
----------------------------------------------------------------------------
Website Links
HudBay Minerals Inc.:
www.HudBayminerals.com
Management's Discussion and Analysis:
http://media3.marketwire.com/docs/Q410MDA.pdf
Financial Statements:
http://media3.marketwire.com/docs/Q410FS.pdf
Fourth Quarter and Year-end 2010 Supplemental Disclosure
http://media3.marketwire.com/docs/Q410SUPP.pdf
Conference Call and Webcast
Date: Thursday, March 10, 2011
Time: 10 a.m. ET
Webcast: www.hudbayminerals.com
Dial in: 416-644-3415 or 877-974-0445
Replay: 416-640-1917 or 877-289-8525
Replay Passcode: 4411868#
The conference call replay will be available until midnight (Eastern Time) on March 17, 2011. An archived audio webcast of the call also will be available on HudBay's website.
HudBay Minerals Inc.
HudBay Minerals Inc. (TSX: HBM)(NYSE: HBM) is a Canadian integrated mining company with assets in North, Central and South America
principally focused on the discovery, production and marketing of
metals. The company's objective is to maximize shareholder value through
efficient operations, organic growth and accretive acquisitions, while
maintaining its financial strength. A member of the S&P/TSX Composite Index and the S&P/TSX Global Mining Index, HudBay is committed to high standards of corporate governance and sustainability.
Forward-Looking Information
This news release contains "forward-looking information" within the meaning of applicable Canadian and United States
securities legislation. Forward-looking information includes, but is
not limited to, information with respect to the Company's intentions
respecting Norsemont and its Constancia project, the Company's ability
to develop its Lalor project and the Back Forty project, the ability of
management to execute on key strategic and operational objectives and
meet production forecasts, exploration expenditures and activities and
the possible success of such exploration activities, the estimation of
mineral reserves and resources, the realization of mineral estimates,
the timing and amount of estimated future production, costs of
production, capital expenditures, estimate of salvage value, costs and
timing of the development of new
deposits, mineral pricing, reclamation costs, economic outlook,
government regulation of mining operations, mine life projections, the
ability to maintain a regular dividend on its common shares, the
availability of third party concentrate for processing in HudBay's
facilities and the availability of third party processing facilities for
HudBay's concentrate, business and acquisition strategies and the
timing and possible outcome of pending litigation. Often, but not
always, forward-looking information can be identified by the use of
forward-looking words like "plans", "expects", or "does not expect", "is
expected", "budget", "scheduled", "estimates", "forecasts", "intends",
"understands", "anticipates", or "does not anticipate", or "believes" 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 information is based on the opinions and estimates of
management as of the date such information is provided and is subject to
known and unknown risks, uncertainties and other factors that may cause
the actual results, level of activity, performance or achievements of
HudBay to be materially different from those expressed or implied by
such forward-looking information, including the ability to develop and
operate the Lalor, Constancia and Fenix projects on an economic basis
and in accordance with applicable timelines, geological and technical
conditions at Lalor differing from areas successfully mined by us in the
past, the ability to meet required solvency tests to support a dividend
payment, risks associated with the mining industry such as economic
factors (including future commodity prices, currency fluctuations and
energy prices), failure of plant, equipment,
processes and transportation services to operate as anticipated,
dependence on key personnel and employee relations, environmental risks,
government regulation, actual results of current exploration
activities, possible variations in ore grade or recovery rates,
permitting timelines, capital expenditures, reclamation activities, land
titles, and social and political developments and other risks of the
mining industry as well as those risk factors discussed or referred to
in HudBay's AIF under the heading "Risk Factors". Although HudBay has
attempted to identify important factors that could cause actual results
to differ materially from those contained in forward-looking
information, there may be other factors that cause results not to be as
anticipated, estimated or intended. In addition, certain forward-looking
information in this MD&A relate to prospective results of
operations,
financial position or cash flows based on assumptions about future
economic conditions or courses of action. Such information is provided
in attempt to assist the reader in identifying trends and anticipated
events that may affect HudBay's business, results of operations and
financial position and may not be appropriate for other purposes.
There can be no assurance that forward-looking information will prove to
be accurate, as actual results and future events could differ
materially from those anticipated in such information. Accordingly,
readers should not place undue reliance on forward-looking information.
HudBay does not undertake to update any forward-looking information,
except as required by applicable securities laws, or to comment on
analyses, expectations or statements made by third parties in respect of
HudBay, its financial or operating results or its securities.
Note to United States Investors
Information concerning our mineral properties has been prepared in
accordance with the requirements of Canadian securities laws, which
differ in material respects from the requirements of SEC Industry Guide
7. Under Securities and Exchange Commission (the "SEC")
Industry Guide 7, mineralization may not be classified as a "reserve"
unless the determination has been made that the mineralization could be
economically and legally produced or extracted at the time of the
reserve determination, and the SEC does not recognize the
reporting of mineral deposits which do not meet the United States
Industry Guide 7 definition of "Reserve". In accordance with National
Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI
43-101") of the Canadian Securities Administrators, the terms "mineral
reserve", "proven mineral reserve", "probable mineral reserve", "mineral
resource", "measured mineral resource", "indicated mineral resource" and
"inferred mineral resource" are defined in the Canadian Institute of Mining, Metallurgy and Petroleum (the "CIM") Definition Standards for Mineral Resources and Mineral Reserves adopted by the CIM Council on December 11, 2005.
While the terms "mineral resource", "measured mineral resource",
"indicated mineral resource" and "inferred mineral resource" are
recognized and required by NI 43-101, the SEC does not
recognize them. You are cautioned that, except for that portion of
mineral resources classified as mineral reserves, mineral resources do
not have demonstrated economic value. Inferred mineral resources have a
high degree of uncertainty as to their existence and as to whether they
can be economically or legally mined. Under Canadian securities laws,
estimates of
inferred mineral resources may not form the basis of an economic
analysis. It cannot be assumed that all or any part of an inferred
mineral resource will ever be upgraded to a higher category. Therefore,
you are cautioned not to assume that all or any part of an inferred
mineral resource exists, that it can be economically or legally mined,
or that it will ever be upgraded to a higher category. Likewise, you are
cautioned not to assume that all or any part of measured or indicated
mineral resources will ever be upgraded into mineral reserves. You are
urged to consider closely the disclosure on the technical terms in
Schedule A "Glossary of Mining Terms" of HudBay's annual information
form for the fiscal year ended December 31, 2009, available on SEDAR at www.sedar.com and incorporated by reference as Exhibit 99.8 in the Offeror's Form
40-F filed on October 19, 2010 (File No. 001-34244).
(F)
Contacts:
HudBay Minerals Inc.
John Vincic, Vice President,
Investor Relations and Corporate Communications
(416) 362 0615
john.vincic@hudbayminerals.com
www.hudbayminerals.com
Source: HudBay Minerals Inc.
News Provided by Acquire Media