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NEWS RELEASE TRANSMITTED BY CANADIAN CORPORATE NEWS
FOR: NORTH AMERICAN PALLADIUM LTD
TSE SYMBOL: PDL
AUGUST 20, 1998
North American Palladium Ltd. - Second Quarter Financial
Results
THUNDER BAY, ONTARIO--North American Palladium Ltd., today
released the financial results for the 2nd Quarter ended June 30,
1998. The Company reported a net loss for the quarter of
$7,835,000 or $0.65 CDN per share, which included depreciation and
amortization of $900,000 (1997 - loss of $5,590,000 or $0.47 CDN
per share including $1,612,000 depreciation and amortization).
For the year to date the Company reported a net loss of
$15,875,000 or $1.33 CDN per share which included $3,342,000
depreciation and amortization (1997 - loss of $11,459,000 or $0.97
CDN per share which included $3,195,000 depreciation and
amortization. Cash expended on operating activities for the
quarter totalled $3,696,000 with the year to date totalling
$10,043,000. This compares to $6,782,000 for the same quarter in
1997 with a year to date total of $11,839,000.
/T/
NORTH AMERICAN PALLADIUM LTD.
CORPORATE REPORT
(Canadian Funds in Thousands of Dollars Except
Share and Per Share Amounts)
Quarter Ended Year to Date
June 30, as at June 30,
1998 1997 1998 1997
Revenue from
metal sales 6,027 4,410 11,129 8,287
Income (loss) from
mining operations (4,108) (3,160) (8,322) (6,358)
Net Profit (Loss) (7,835) (5,590) (15,875) (11,459)
Average shares
outstanding 11,932,917 11,811,910 11,919,723 11,803,406
Net Profit (Loss)
per share (0.65) (0.47) (1.33) (0.97)
/T/
Las des Iles Mines Ltd., the Company's wholly owned subsidiary, is
currently operating a platinum group metals property northwest of
Thunder Bay, Ontario whose principal metal is palladium. Fixed
assets, mining leases and deferred expenditures, net of
depreciation and amortization, at June 30, 1998 totalled
$36,183,000, $11,604,000 and $4,698,000 respectively.
FORWARD SALE CONTRACTS
The Company is pleased to announce the completion of the forward
sale palladium contracts during the month of July. The Company is
currently investigating alternative marketing strategies to
optimize revenues and is now able to sell its product on the open
market.
OPERATIONS
Subsequent to period end, the Company introduced new equipment to
the existing open-pit fleet consisting of a Caterpillar 5130
hydraulic shovel, a Caterpillar 16G grader and a Caterpillar D10N
dozer. The new equipment replaced ineffective portions of the
fleet resulting in increased ore and waste production in July.
Further production increases are expected for the remainder of the
third quarter as equipment availability and productivity are
expected to improve.
Several maintenance and operational improvements have been
accomplished in the concentrator which have aided in increasing
the palladium recovery levels to 80.5 percent, an 8.3 percent
increase over the same period in 1997.
EXPLORATION
The exploration team have recently completed stripping the "C"
zone and have commenced a mapping and detailed sampling program
which will be compiled with previous drill results to develop a
geological model of the area between the "C" zone and the
operating Roby zone. The Company believes this area has the
potential for a low grade, high tonnage ore source.
The Company is also stripping an area east of the Roby Zone which
is a possible extension of the North Roby Zone. This zone is a
previously explored mineralization trend. However, further
information is needed to assess its size and value. Mr. Minty
stated that the Program is in its initial stages and further
drilling and assays are necessary before confirming an ore
reserve.
/T/
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PRODUCTION STATISTICS
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Second Quarter Percentage January 1 Percentage
Increase to June 30 Increase
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1998 1997 1998 1997
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Palladium
(troy oz) 19,870 13,538 46.8 37,899 25,717 47.3
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Platinum
(troy oz) 1,302 942 38.2 2,531 1,746 44.6
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Gold
(troy oz) 1,116 905 23.3 2,393 1,682 42.3
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Copper
(lbs) 248,365 218,515 13.7 598,592 418,016 43.2
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Nickel
(lbs) 195,764 182,588 7.2 481,214 354,820 35.6
---------------------------------------------------------------
Tons
Milled 233,312 160,652 45.2 467,447 332,481 40.6
---------------------------------------------------------------
/T/
SUMMARY
The Company reports a notable increase in the metals produced from
its concentrate. Palladium production during the first six months
totalled 37,899 troy ounces, an increase of 44.6 percent over the
same period in 1997.
Mr. Keith C. Minty, President and CEO, states that with continuing
increases in ore production and metal recovery levels, and
combined with the completion of the palladium hedging program as
well as the positive initial results of the exploration program,
the Company is on the road to recovery.
North American Palladium Limited, through its wholly owned
subsidiary Lac Des Iles Mines Ltd., operates Canada's only primary
PGM mine and is the world's largest open pit PGM producer.
-30-
FOR FURTHER INFORMATION PLEASE CONTACT:
North American Palladium Ltd.
Keith C. Minty
President and C.E.O.
(807) 345-4479
(807) 345-7796 (FAX)
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