VANCOUVER, BRITISH COLUMBIA -- (Marketwire) -- 04/01/13 -- MAG Silver Corp. (TSX: MAG)(NYSE MKT: MVG)(NYSE Amex: MVG) ("MAG" or the "Company") announces the Company's audited consolidated financial results for the year ended December 31, 2012. For complete details of the annual financial statements and related Management's Discussion and Analysis, please see the Company's filings on SEDAR (www.sedar.com) or on EDGAR (www.sec.gov). All amounts herein are reported in United States dollars unless otherwise specified.
2012 FINANCIAL PERFORMANCE
At December 31, 2012, the Company had working capital of $40,492,095 (December 31, 2011: $25,779,667), including cash on hand of $40,621,158 (December 31, 2011: $26,217,409). The primary use of cash during the year ended December 31, 2012 was for exploration and evaluation expenditures in Mexico totaling $11,981,221 (December 31, 2011: $9,014,714). The Company also advanced to Minera Juanicipio, S.A. de C.V. ("Minera Juanicipio") and expended on its own account a further $4,577,611 (December 31, 2011: $2,583,367) for work conducted on the Juanicipio property.
The Company's net loss amounted to $12,109,761 (or $0.22 per share) for the year ended December 31, 2012 as compared to $8,250,743 (or $0.15 per share) in 2011. The increased net loss in 2012 is due to increased exploration and evaluation cost write-downs (Esperanza - $2,468,379 and a claim under the Lagartos properties - $896,099, compared to $531,515 in 2011 for the San Ramone property) and costs incurred in 2012 dealing and negotiating with a dissident group of MAG shareholders. The 2011 comparable loss was also reduced by the receipt of a $1.86 million arbitration award recognized as income in the prior year.
Shareholders may receive, upon request and free of charge, a hard copy of the Audited Financial Statements. The Company's 40-F has also been filed with the United States Securities and Exchange Commission.
An updated Preliminary Economic Assessment for the Juanicipio Project, commissioned by Minera Juanicipio and carried out by AMC Mining Consultants (Canada) Ltd. (the "AMC Study") was announced on June 14, 2012 and filed on SEDAR on July 16, 2012 (see press release dated June 14, 2012). With the completion of the AMC Study, MAG and Fresnillo Plc ("Fresnillo") now have a framework on which the Minera Juanicipio Technical Committee can build upon for the continued advancement of the project. On August 15, 2012, the Company announced that Minera Juanicipio had approved an 18 month mine permitting and underground development budget of $25 million. The majority of this budget has been rolled over into 2013 and the early part of 2014 because of development permitting delays resulting from the Mexican government changeover late in 2012. The budgeted program covers mine permitting, surface preparation and the commencement of the first 2,500 metres of underground decline development.
A hydrogeology (water management) study has been commenced. A geotechnical study has been completed with the assistance of Penoles' (a related party of Fresnillo) Geotechnical & Construction Group, which has included a visit to the nearby Fresnillo Saucito operation in order to analyze rock quality in anticipation of stope preparation and development at Juanicipio. As well, a division of Penoles (CIDT) has been contracted to run the recommended metallurgical tests, with almost 254 kilograms of ore bearing material collected systematically along the deposit for metallurgical studies to be carried out. Originally expected in the first quarter of 2013, the operator Fresnillo now reports that it expects the underground decline ground breaking to commence in the second quarter of 2013. Five different contractors from North and South America have been asked to tender for the decline construction and a decision is pending.
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