Nanotech to Present at the 2017 Canaccord Genuity 37th Annual Growth Conference

VANCOUVER, BC—(Marketwired – August 01, 2017) – Nanotech Security Corp. (TSX VENTURE: NTS) (OTCQX: NTSFF), today announced that Troy Bullock, President and CFO, will be presenting at the 2017 Canaccord Genuity Growth Conference in Boston, Massachusetts on Wednesday August 9th at 4:30pm Eastern time.

About Nanotech Security

Nanotech designs, manufactures and markets advanced optical variable devices and colour shifting optical thin film products for branding and anti–counterfeiting purposes. The Company creates visual nano–optic images with colour shifting effects such as 3D, perceived movement, and can also display high–definition colours including skin tones, white, and black, which are not possible using traditional holographic technology. These unique products have brand protection and enhancement applications across a wide range of markets including banknotes, tax stamps, secure government documents, commercial branding, and the pharmaceutical industry. The Company is initially focusing its efforts on the banknote and tax stamp market due to its high margins and its recognizable customer base.

Additional information about Nanotech can be found at the Company's website www.nanosecurity.ca, the Canadian disclosure filings website www.sedar.com or the OTCMarkets disclosure filings website www.otcmarkets.com.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Brio Gold Reports Second Quarter 2017 Financial Results

TORONTO, ON—(Marketwired – August 01, 2017) – BRIO GOLD INC. (TSX: BRIO) (“BRIO GOLD” or the “Company”) announces its second quarter 2017 financial and operating results. All dollar figures are in U.S. dollars unless otherwise indicated.

Q2 2017 Financial and Operating Highlights

  • Production of 44,223 ounces of gold.
  • Total cost of sales of $1,139 per gold ounce sold.
  • Cash costs(1) of $859 per ounce of gold produced.
  • All–in sustaining costs (AISC)(1) of $1,085 per gold ounce produced.
  • Revenues of $52.9 million, on the sale of 42,691 ounces of gold.
  • Mine operating earnings of $4.2 million.
  • Net loss of $7.4 million, or $0.07 per share.
  • Adjusted net loss(1) of $3.6 million, or $0.03 per share.
  • Cash flow from operating activities before changes in working capital of $4.3 million.

(1) A non–GAAP financial measure. For a reconciliation of non–GAAP financial measures, please see the end of this press release.

Q2 2017 Summary Financial Results

     
  For the three months
ended June 30,
For the six months
ended June 30,
In thousands of U.S. Dollars 2017   2016 2017   2016
Revenues from mining operations $ 52,853   $ 65,154 $ 112,352   $ 112,287
Mine operating earnings   4,207     10,889   10,023     24,755
Net (loss)/earnings   (7,385 )   10,315   (4,994 )   20,790
Adjusted (loss)/earnings(1)   (3,559 )   2,315   (1,077 )   3,549
Adjusted EBITDA(1)   6,491     19,069   19,005     36,861
Cash flow from operating activities before changes in working capital   4,273     18,682   19,736     34,942
(1) A non–GAAP financial measure. For a reconciliation of non–GAAP measures, please see the end of this press release.
   

Revenues from mining operations were $52.9 million in the second quarter of 2017 on the sale of 42,691 ounces of gold compared to $65.2 million on the sale of 52,351 ounces of gold for the comparable period in 2016. For the first half of 2017, revenues from mining operations were $112.4 million on the sale of 92,306 ounces of gold compared to $112.3 million on the sale of 93,595 ounces of gold for the comparable period in 2016.

Mine operating earnings totaled $4.2 million for the second quarter of 2017 compared to $10.9 million for the same period in 2016. For the first half of 2017, mine operating earnings were $10.0 million compared to $24.8 million for the same period of 2016. Overall the decrease in mine operating earnings is due to lower gold ounces sold, largely a result of lower grade mined during the period, reduced production from the RDM mine and exchange rate differences.

Net loss in the second quarter of 2017 was $7.4 million or $0.07 per share, a decrease compared to net earnings of $10.3 million or $0.44 per share for the first quarter of 2016. For the first half of 2017, net loss was $5.0 million or $0.04 per share compared to net earnings of $20.8 million or $0.88 per share for the same period in 2016. Overall net earnings were lower due to the changes in mine operating earnings discussed above, and higher income tax expense as a result of non–cash effect on unrealized foreign exchange which is excluded for the calculation of adjusted earnings.

The adjusted loss in the second quarter of 2017 was $3.6 million, or $0.03 per share, compared to an adjusted income of $2.3 million, or $0.10 in the same period of 2016. For the first half of the year, the adjusted loss was $1.1 million, or $0.01 per share, compared to an adjusted income of $3.5 million, or $0.15 per share, in the same period of 2016.

The adjusted EBITDA in the second quarter of 2017 was $6.5 million compared to $19.1 million in the same period of 2016. For the first half of the year, the adjusted EBITDA was $19.0 million compared to $36.9 million in the same period of 2016.

Cash flow from operating activities after changes in working capital for the second quarter of 2017 was an outflow of $2.2 million, compared to an inflow of $16.1 million in the same period of 2016. The Company received an advance payment for $4.4 million in the first quarter of 2017, relating to gold sales delivered in the second quarter for $4.4 million, a transaction that was done in order to manage working capital. Cash flow from operating activities before changes in working capital of $4.3 million in the second quarter of 2017, compared to $18.7 million in the same period of 2016.

Q2 2017 Summary Operational Results

         
    For the three months ended June 30,   For the six months ended June 30,
    2017   2016   Change   2017   2016   Change
Gold production (oz)(1)   44,223   52,737   (16%)   94,763   93,109   2%
Gold sales (oz)(1)   42,691   52,351   (18%)   92,306   93,595   (1)%
Total cost of sales per gold ounce sold(1)   $1,139   $1,037   10%   $1,109   $936   18%
Cash cost per gold ounce produced(1,2)   $859   $726   18%   $842   $667   26%
Consolidated AISC per gold ounce produced(1,2)   $1,085   $969   12%   $1,070   $889   20%
Notes:
(1) Operating statistics only include RDM from the date that it was acquired on April 29, 2016.
(2) A non–GAAP financial measure. For a reconciliation of non–GAAP measures see the end of this press release.
   

Production during the second quarter of 2017 was 44,223 ounces of gold, compared to 52,737 ounces in the same period of 2016. The RDM mine was put on care and maintenance for 41 days during the quarter, as necessary adjustments were completed to meet the revised production plan. At Fazenda Brasileiro, scheduled mill liner replacements impacted production, however planned production at Fazenda Brasileiro for the year is back end weighted, with grade improvements expected in the second half of the year. For the first half of the year, production was 94,763 ounces of gold, compared to 93,109 ounces in the same period of 2016.

Cost of sales including depletion, depreciation and amortization per ounce of gold sold was $1,139 in the second quarter of 2017, compared to $1,037 in the same period of 2016. Cash cost per gold ounce during the second quarter was $859, compared to $726 in the same period of 2016. All–in sustaining cost per ounce of gold produced was $1,085 in the second quarter of 2017, compared to $969 in the same period of 2016.

For the first half of the year, cost of sales including depletion, depreciation and amortization per ounce of gold sold was $1,109 in the first half of 2017, compared to $936 in the same period of 2016. Cash cost per gold ounce was $842 for the first half of 2017, compared to $667 in the same period of 2016. All–in sustaining cost per ounce of gold produced was $1,070 in the first half of 2017, compared to $889 in the same period of 2016.

Overall, the increase in per ounce costs was due to a strengthening of the Brazilian Real against the US Dollar. Including the impact of the foreign exchange hedges, approximately 28% of the total increase in All–in sustaining costs per ounce is due to the strengthening of the Brazilian real against the US dollar when comparing the second quarter of 2017 to 2016, and approximately 41% when comparing the first half of 2017 to 2016. In addition, lower grades impacted production and hence per ounce costs, as a significant portion of operating costs are fixed. Higher corporate G&A from one–time costs associated with the transition to operating as an independent public company also impacted costs. Despite the increase from the comparable periods in 2016, All–in sustaining costs for the year 2017 are expected to achieve the 2017 guidance of $995–$1,015 per ounce.

Breakdown by Mine

         
    For the three months
ended June 30,
  For the six months
ended June 30,
Gold production (oz)   2017   2016   Change   2017   2016   Change
  Pilar   20,287   22,806   (11)%   40,771   44,654   (9)%
  Fazenda Brasileiro   14,092   16,873   (16)%   28,964   35,397   (18)%
  RDM(1)   9,844   13,058   (25)%   25,028   13,058   92%
Total Production   44,223   52,737   (16)%   94,763   93,109   2%
                         
                         
Total Cost of Sales ($ per oz sold)                        
  Pilar   $1,144   $1,023   12%   $1,083   $962   13%
  Fazenda Brasileiro   $1,145   $1,008   14%   $1,167   $856   36%
  RDM(1)   $1,125   $1,079   4%   $1,088   $1,079   1%
Total Cost of Sales per gold oz sold   $1,139   $1,037   10%   $1,109   $936   18%
                         
                         
Cash Costs ($ per oz produced)                        
  Pilar   $831   $679   22%   $809   $656   23%
  Fazenda Brasileiro   $892   $726   23%   $841   $627   34%
  RDM(1)   $869   $807   8%   $927   $807   15%
Total Cash Costs   $859   $726   18%   $842   $667   26%
                         
AISC ($ per oz produced)                        
  Pilar   $1,022   $856   19%   $1,011   $801   26%
  Fazenda Brasileiro   $956   $988   (3)%   $999   $808   24%
  RDM(1)   $872   $883   (1)%   $953   $882   8%
Total Mine AISC ($ per oz produced)   $968   $916   6%   $992   $821   21%
Total Consolidated AISC ($ per oz produced)   $1,085   $969   12%   $1,070   $889   20%
Notes:
(1) Operating statistics only include RDM from the date that it was acquired on April 29, 2016.
   

Pilar

Production at the Pilar Mine in the second quarter of 2017 was 20,287 ounces of gold in line with plan, but lower compared to 22,806 ounces in the same period of 2016. For the first half of the year, production was 40,771 ounces of gold compared to 44,654 in the same period of 2016. Overall the decrease in production is due to gold feed grades as a result of mine sequencing, partially offset by higher throughput and recovery. The Company maintains its production guidance for 2017 of 83,000 to 88,000 ounces of gold.

Cost of sales including depletion, depreciation and amortization was $1,144 per ounce, compared to a cost of sales including depletion, depreciation and amortization of $1,023 per ounce of gold sold in the same period of 2016. For the first half of 2017, cost of sales including depletion, depreciation and amortization was $1,083 compared to $962 in the same period of 2016. Cash costs were $831 per ounce of gold produced in the second quarter of 2017, compared to $679 per ounce of gold produced in the same quarter of 2016. For the first half of 2017, cash costs were $809 per ounce of gold produced, compared to $656 in the same period of 2016. All–in sustaining costs were $1,022 per ounce of gold produced in the second quarter of 2017, compared to $856 per ounce of gold produced in the same quarter of 2016. For the first half of 2017, All–in sustaining costs were $1,011 per ounce of gold produced, compared to $801 in the same period of 2016. Overall costs were higher mainly due to the strengthening of the Brazilian Real against the US dollar, and lower grades.

Fazenda Brasileiro

Production in the second quarter of 2017 was 14,092 ounces of gold, compared to 16,873 ounces in the same period of 2016. For the first half of 2017, production was 28,964 ounces of gold, compared to 35,397 in the same period of 2016. Overall, production was impacted by lower grades and mill liner replacement, partially offset by improved recovery. During the second quarter of 2017, ball mill one was down for two days and ball mill two was down for four days for liner replacement.

Planned production at Fazenda Brasileiro for the year is back end weighted and the mine is forecast to achieve annual guidance of 65,000 to 70,000 ounces.

Cost of sales including depletion, depreciation and amortization was $1,145 per ounce, compared to a cost of sales including depletion, depreciation and amortization of $1,008 per ounce of gold sold in the same period of 2016. For the first half of 2017, cost of sales including depletion, depreciation and amortization was $1,167 compared to $856 in the same period of 2016. Cash costs were $892 per ounce of gold produced in the second quarter of 2017, compared to $726 per ounce of gold produced in the same quarter of 2016. For the first half of 2017, cash costs were $841 per ounce of gold produced, compared to $627 per ounce in the same period of 2016. All–in sustaining costs for the second quarter of 2017 was $956, a decrease from $988 in the same period of 2016. For the first half of 2017, All–in sustaining costs were $999 per ounce of gold produced, compared to $808 in the same period of 2016.

Grade, as discussed above, was the main contributor to higher costs on a per ounce basis, since a large portion of operating costs are fixed. Expansionary capital increased in the second quarter of 2017 compared to the same period of 2016 as the Company focuses on developing the Canto deposit, which is expected to extend the mine life.

RDM

Production in the second quarter of 2017 was 9,844 ounces of gold, compared to 13,058 ounces in the same period of 2016. For the first half of 2017, production was 25,028 ounces of gold, compared to 13,058 in the same period of 2016. During the quarter, the mine was put on care and maintenance for 41 days, as the operations were re–organized to meet the new production plan that was announced last quarter. During this period, water was conserved while the existing small–scale mining contractor was demobilized and the Company reduced the operations manpower to conform with the revised life of mine plan. The newly built water dam and water pipeline was also successfully tested and made operational during this period. Operations were restarted under the new operating plan with the Company's currently owned larger scale equipment fleet mining ore.

The Company has completed its analysis regarding the stripping equipment fleet at the RDM mine and has selected a large–scale mining contractor to perform the stripping work at the mine. The Company does not anticipate any change to life of mine production plans or 2017 cost guidance. Brio Gold expects cash costs and AISC to increase by 4% and 6%, respectively, when compared to the previously announced average life of mine costs. As a result of choosing this option, the Company is eliminating the forecasted $43.9 million capital expenditure that it announced in its revised RDM forecast last quarter. Notably, this decision is slightly value accretive to RDM and removes the need for any upfront capital.

The Company maintains its revised production 2017 guidance at RDM of 50,000 to 65,000 ounces. This guidance range includes the expectation that the processing plant at RDM will be down for a total of three months in 2017 as a result of the unusual drought conditions experienced earlier this year after the completion of the construction of the water storage facility near the end of the rainy season. Continuous operations at RDM is expected for the life of mine commencing in the fourth quarter of this year.

Cost of sales including depletion, depreciation and amortization was $1,125, compared to a cost of sales including depletion, depreciation and amortization of $1,079 per ounce of gold sold in the same period of 2016. For the first half of 2017, cost of sales including depletion, depreciation and amortization was $1,088 compared to $1,079 in the same period of 2016. Cash costs were $869 per ounce of gold produced in the second quarter of 2017, compared to $807 per ounce of gold produced in the same quarter of 2016. For the first half of 2017, cash costs were $927 per ounce of gold produced, compared to $807 in the same period of 2016. All–in sustaining costs were $872 per ounce of gold produced in the second quarter of 2017, compared to $883 per ounce of gold produced in the same quarter of 2016. For the first half of 2017, All–in sustaining costs were $953 per ounce of gold produced, compared to $883 in the same period of 2016. Costs were impacted by lower grades due to mine sequencing, partially offset by improved recoveries as a result of plant optimization initiatives.

Development Update

Santa Luz

The Santa Luz mine is in the execution phase and the Company continues to advance the project toward its re–start planned for the second quarter of 2018. Capital expenditures for the project are forecast to remain below budget. Basic engineering was completed in May and detailed construction engineering started in June. The company has purchased major long lead items for the project and procurement is moving forward. The tailings liner contractor has been mobilized to site and the new tailing pond liners have been delivered. Village relocation construction was initiated in the quarter with completion expected next quarter.

The Company has been continuously running the pilot plant and testing ore samples of all lithological types at the mine since completion of the technical report in July last year. The results of this test work confirm the average gold recovery published last year. Consistent recovery results for both carbonaceous, dacitic and blended ores have been verified with a standard resin–in–leach circuit with a very high level of confidence.

In the first half of 2017, Brio Gold completed a 4,200 metre drill program that focused on detailing and expanding a northwest trending zone of high–grade gold mineralization in the northeastern portion of the main C1 open pit orebody as well as infill drilling in both the C1 and Antas 3 orebodies. The positive drill results are expected to be incorporated into an updated mineral reserve and resource estimate in August of 2017.

RDM

Planning and permitting for the power line and substations to connect RDM to the power grid continued on schedule during the quarter. Construction of the powerline is expected to commence at the beginning of the third quarter of 2017 and the Company is targeting to commission the new grid connected power line in Q2 2018. The powerline will replace the current lower capacity diesel power generators, which is expected to reduce costs, improve grind/recovery and expand mill throughput. The connection to low cost grid power will complete the plant expansion to an operating capacity of 9,000 tonnes per day from 7,000 tonnes per day.

Second Quarter 2017 Financial Results and Conference Call

Brio Gold will release its second quarter 2017 financial results after market close on August 1, 2017 followed by a conference call and webcast on August 2, 2017 at 10:00 a.m. ET.

Second Quarter 2017 Conference Call:
Toll Free (North America): 1–844–543–5236
International: 1–703–318–2218
Webcast: www.briogoldinc.com

Conference Call REPLAY:
Toll Free (North America): 1–855–859–2056
Toronto Local and International: 1–404–537–3406
Conference ID: 53274183

The conference call replay will be available from 1:00 p.m. ET on August 2, 2017 until 1:00 p.m. ET on August 9, 2017.

About Brio Gold

Brio Gold is a new Canadian mining company with significant gold producing, development and exploration stage properties in Brazil. Brio Gold's portfolio includes three operating gold mines and a fully–permitted, fully–constructed mine that was on care and maintenance and currently is in development to be re–started in 2018. Brio Gold produced approximately 190,000 ounces of gold in 2016 and at full run–rate expects annual production to be approximately 400,000 ounces of gold.

CAUTIONARY NOTE REGARDING FORWARD–LOOKING STATEMENTS: This news release contains or incorporates by reference “forward–looking statements” and “forward–looking information” under applicable Canadian securities legislation. Forward–looking information includes, but is not limited to information with respect to the Company's strategy, plans or future financial or operating performance, the outcome of the legal matters involving the damages assessments and any related enforcement proceedings. Forward–looking statements are characterized by words such as “plan,” “expect”, “budget”, “target”, “project”, “intend”, “believe”, “anticipate”, “estimate” and other similar words, or statements that certain events or conditions “may” or “will” occur. Forward–looking statements are based on the opinions, assumptions and estimates of management considered reasonable at the date the statements are made, and are inherently subject to a variety of risks and uncertainties and other known and unknown factors that could cause actual events or results to differ materially from those projected in the forward–looking statements. These factors include the Company's expectations in connection with the production and exploration, development and expansion plans at the Company's projects discussed herein being met, the impact of proposed optimizations at the Company's projects, the impact of the proposed new mining law in Brazil, and the impact of general business and economic conditions, global liquidity and credit availability on the timing of cash flows and the values of assets and liabilities based on projected future conditions, fluctuating metal prices (such as gold and silver), currency exchange rates (such as the Brazilian real versus the United States dollar), the impact of inflation, possible variations in ore grade or recovery rates, changes in the Company's hedging program, changes in accounting policies, changes in mineral resources and mineral reserves, risks related to asset disposition, risks related to metal purchase agreements, risks related to acquisitions, changes in project parameters as plans continue to be refined, changes in project development, construction, production and commissioning time frames, unanticipated costs and expenses, higher prices for fuel, steel, power, labour and other consumables contributing to higher costs and general risks of the mining industry, failure of plant, equipment or processes to operate as anticipated, unexpected changes in mine life, final pricing for concentrate sales, unanticipated results of future studies, seasonality and unanticipated weather changes, costs and timing of the development of new deposits, success of exploration activities, permitting timelines, government regulation and the risk of government expropriation or nationalization of mining operations, risks related to relying on local advisors and consultants in foreign jurisdictions, environmental risks, unanticipated reclamation expenses, risks relating to joint venture operations, title disputes or claims, limitations on insurance coverage and timing and possible outcome of pending and outstanding litigation and labour disputes, risks related to enforcing legal rights in foreign jurisdictions, as well as those risk factors discussed or referred to herein. Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward–looking statements, there may be other factors that cause actions, events or results not to be anticipated, estimated or intended. There can be no assurance that forward–looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. The Company undertakes no obligation to update forward–looking statements if circumstances or management's estimates, assumptions or opinions should change, except as required by applicable law. The reader is cautioned not to place undue reliance on forward–looking statements. The forward–looking information contained herein is presented for the purpose of assisting investors in understanding the Company's expected financial and operational performance and results as at and for the periods ended on the dates presented in the Company's plans and objectives and may not be appropriate for other purposes.

Non–GAAP Financial Measures

The Company has included certain non–GAAP financial measures including cash costs per ounce of gold produced, all–in sustaining costs per ounce of gold produced, adjusted earnings (loss), and adjusted EBITDA to supplement its consolidated financial statements, which are presented in accordance with IFRS.

The Company believes that these measures, together with measures determined in accordance with IFRS, provide investors with an improved ability to evaluate the underlying performance of the Company. Non–GAAP financial measures do not have any standardized meaning prescribed under IFRS, and therefore they may not be comparable to similar measures employed by other companies. The data is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.

Cash Costs

The Company uses the non–GAAP financial measure “cash costs” on a per ounce of gold produced basis because it believes this measure provides investors and analysts with useful information about the Company's underlying cash costs of operations and is a relevant metric used to understand the Company's operating profitability, and ability to generate cash flow. Cash costs figures are calculated based on the standard developed by The Gold Institute, which was a worldwide association of suppliers of gold and gold products and included leading North American gold producers. The Gold Institute ceased operations in 2002, but the standard remains the generally accepted standard of reporting cash costs of production in North America. Adoption of the standard is voluntary and the cost measures presented herein may not be comparable to other similarly titled measures of other companies.

Cash costs include mine site operating costs such as mining, processing, administration, production taxes and royalties, which are not based on sales or taxable income calculations, but are exclusive of amortization, reclamation, capital, development, and exploration costs. Cash costs per ounce of gold produced are calculated on a weighted average basis.

The term “cash costs” has no standard meaning and therefore, the Company's definitions are unlikely to be comparable to similar measures presented by other companies and should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS and is not necessarily indicative of operating costs, operating profit or cash flows presented under IFRS.

All–in Sustaining Costs

The Company uses the non–GAAP financial measure “all–in sustaining costs”, also referred to as “AISC”, on a per ounce of gold produced basis because it believes this measure provides investors with useful information about the Company's underlying cash costs of operations, after deducting certain non–discretionary items such as sustaining capital expenditures, exploration expenses and certain general and administrative costs and is a relevant metric used to understand the Company's ability to generate cash flow. All–in sustaining costs are based on cash costs, including cost components of mine sustaining capital expenditures and exploration and evaluation expense. All–in sustaining costs for a mine do not include capital expenditures attributable to projects or mine expansions, exploration and evaluation costs attributable to growth projects, Brio Gold corporate general and administrative expenses, Yamana general and administrative expenses allocated to Brio Gold or stock–based compensation, income tax payments, financing costs and dividend payments. Consequently, this measure is not representative of all of the Company's cash expenditures. In addition, the calculation of all–in sustaining costs does not include depletion, depreciation and amortization expense as it does not reflect the impact of expenditures incurred in prior periods. The term “all–in sustaining costs” has no standard meaning and therefore, the Company's definitions are unlikely to be comparable to similar measures presented by other companies and should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS and is not necessarily indicative of operating costs, operating profit or cash flows presented under IFRS.

Reconciliation of cost of sales including depletion, depreciation and amortization to cash costs and all–in sustaining costs, consolidated and per mine (Based on Condensed Consolidated Interim Financial Statements unless otherwise noted)

       
    For the three months ended June 30, 2017  
(In thousands of U.S. dollars)   Consolidated     Pilar Mine     Fazenda
Brasileiro
Mine
    RDM Mine  
Cost of sales including depletion, depreciation and amortization   48,646     22,635     14,624     11,387  
Depletion, depreciation and amortization   (11,541 )   (6,213 )   (3,189 )   (2,139 )
Adjustments:                        
Inventory movement and adjustments(1)   877     436     1,135     (694 )
Cash costs(2)   37,982     16,858     12,570     8,554  
General and administrative expenses attributable to all–in sustaining costs   6,458     142     22     6  
Stock based compensation   (2,002 )            
Sustaining capital expenditures   5,436     3,743     878     24  
Exploration and evaluation expense   149         2      
All–in sustaining costs(2)   48,023     20,743     13,472     8,584  
                         
Cost of sales including depletion, depreciation and amortization per gold ounce sold   1,139     1,144     1,145     1,125  
Cash cost per gold ounce produced(2)   859     831     892     869  
All–in sustaining costs per ounce produced(2)   1,085     1,022     956     872  
                         
Gold ounces produced during the period (oz.)   44,223     20,287     14,092     9,844  
Gold ounces sold during the period (oz.)   42,691     19,793     12,776     10,122  
                         
       
    For the three months ended June 30, 2016  
(In thousands of U.S. dollars)   Consolidated     Pilar Mine     Fazenda
Brasileiro
Mine
    RDM Mine  
Cost of sales including depletion, depreciation and amortization   54,265     22,554     17,784     13,659  
Depletion, depreciation and amortization   (15,752 )   (8,782 )   (5,484 )   (1,218 )
Adjustments:                        
Inventory movement and adjustments(1)   (226 )   1,713     (50 )   (1,903 )
Cash costs(2)   38,287     15,485     12,250     10,538  
General and administrative expenses attributable to all–in sustaining costs   5,665     452     71     4  
Stock based compensation   (1,742 )            
Sustaining capital expenditures   8,862     3,516     4,350     988  
Exploration and evaluation expense   30              
All–in sustaining costs(2)   51,102     19,453     16,671     11,530  
                         
Cost of sales including depletion, depreciation and amortization per gold ounce sold   1,037     1,023     1,008     1,079  
Cash cost per gold ounce produced(2)   726     679     726     807  
All–in sustaining costs per ounce produced(2)   969     856     988     883  
                         
Gold ounces produced during the period (oz.)   52,737     22,806     16,873     13,058  
Gold ounces sold during the period (oz.)   52,351     22,047     17,650     12,654  
                         
       
    For the six months ended June 30, 2017  
(In thousands of U.S. dollars)   Consolidated     Pilar Mine     Fazenda
Brasileiro
Mine
    RDM Mine  
Cost of sales including depletion, depreciation and amortization   102,329     43,587     31,076     27,666  
Depletion, depreciation and amortization   (24,906 )   (11,282 )   (9,780 )   (3,844 )
Adjustments:                        
Inventory movement and adjustments(1)   3,121     679     3,063     (621 )
Cash costs(2)   80,544     32,984     24,359     23,201  
General and administrative expenses attributable to all–in sustaining costs   11,548     716     498     328  
Stock based compensation   (3,744 )            
Sustaining capital expenditures   12,831     7,513     3,968     325  
Exploration and evaluation expense   239              
All–in sustaining costs(2)   101,418     41,213     28,825     23,854  
                         
Cost of sales including depletion, depreciation and amortization per gold ounce sold   1,109     1,083     1,167     1,088  
Cash cost per gold ounce produced(2)   842     809     841     927  
All–in sustaining costs per ounce produced(2)   1,070     1,011     999     953  
                         
Gold ounces produced during the period (oz.)   94,763     40,771     28,964     25,028  
Gold ounces sold during the period (oz.)   92,306     40,258     26,625     25,423  
                         
       
    For the six months ended June 30, 2016  
(In thousands of U.S. dollars)   Consolidated     Pilar Mine     Fazenda
Brasileiro
Mine
    RDM Mine  
Cost of sales including depletion, depreciation and amortization   87,532     41,950     31,923     13,659  
Depletion, depreciation and amortization   (26,558 )   (16,310 )   (9,030 )   (1,218 )
Adjustments:                        
Inventory movement and adjustments(1)   1,130     3,653     (699 )   (1,903 )
Cash costs(2)   62,104     29,293     22,194     10,538  
General and administrative expenses attributable to all–in sustaining costs   10,917     534     170     4  
Stock based compensation   (3,484 )            
Sustaining capital expenditures   13,186     5,941     6,237     988  
Exploration and evaluation expense   51              
All–in sustaining costs(2)   82,774     35,768     28,601     11,530  
                         
Cost of sales including depletion, depreciation and amortization per gold ounce sold   936     962     856     1,079  
Cash cost per gold ounce produced(2)   667     656     627     807  
All–in sustaining costs per ounce produced(2)   889     801     808     883  
                         
Gold ounces produced during the period (oz.)   93,109     44,654     35,397     13,058  
Gold ounces sold during the period (oz.)   93,595     43,633     37,308     12,654  
                         
Notes:
(1) Inventory movement and adjustment represent the difference between the costs of production (which are based on ounces produced) and the cost of sales (which is based on ounces sold). The timing difference between the units sold and the costs of those units requires an adjustment to reflect the nature of the underlying metric.
(2) A non–GAAP financial measure.
   

Quarterly trailing cost of sales including depletion, depreciation and amortization to cash costs consolidated and per mine (Based on Condensed Consolidated Interim Financial Statements unless otherwise noted)

                         
Brio Gold Consolidated                        
(In thousands of U.S. dollars)   Q2–17     Q1–17     Q4–16     Q3–16  
Cost of sales including depletion, depreciation and amortization   48,646     53,684     71,169     53,009  
Depletion, depreciation and amortization   (11,541 )   (13,366 )   (26,275 )   (13,936 )
Adjustments:                        
Inventory movement and adjustments(1)   877     2,254     (2,897 )   (1,614 )
Cash costs(2)   37,982     42,572     41,997     37,459  
                         
Cost of sales including depletion, depreciation and amortization per gold ounce sold   1,139     1,082     1,421     1,083  
Cash cost per gold ounce produced(2)   859     842     832     813  
                         
Gold ounces produced during the period (oz.)   44,223     50,540     50,477     46,075  
Gold ounces sold during the period (oz.)   42,691     49,615     50,092     48,837  
                         
                         
Brio Gold Consolidated                        
(In thousands of U.S. dollars)   Q2–16     Q1–16     Q4–15     Q3–15  
Cost of sales including depletion, depreciation and amortization   54,265     33,111     39,812     42,598  
Depletion, depreciation and amortization   (15,752 )   (10,855 )   (14,076 )   (16,752 )
Adjustments:                        
Inventory movement and adjustments(1)   (226 )   1,382     (1,850 )   (213 )
Cash costs(2)   38,287     23,638     23,886     25,633  
                         
Cost of sales including depletion, depreciation and amortization per gold ounce sold   1,037     803     1,016     1,104  
Cash cost per gold ounce produced(2)   726     590     610     667  
                         
Gold ounces produced during the period (oz.)   52,737     40,372     39,279     38,430  
Gold ounces sold during the period (oz.)   52,351     41,243     39,194     38,600  
                         
                         
Pilar Mine                        
(In thousands of U.S. dollars)   Q2–17     Q1–17     Q4–16     Q3–16  
Cost of sales including depletion, depreciation and amortization   22,635     20,953     36,843     23,787  
Depletion, depreciation and amortization   (6,213 )   (5,070 )   (17,919 )   (9,295 )
Adjustments:                        
Inventory movement and adjustments(1)   436     258     408     1,515  
Cash costs(2)   16,858     16,141     19,332     16,007  
                         
Cost of sales including depletion, depreciation and amortization per gold ounce sold   1,144     1,024     1,687     1,152  
Cash cost per gold ounce produced(2)   831     788     872     791  
                         
Gold ounces produced during the period (oz.)   20,287     20,484     22,170     20,237  
Gold ounces sold during the period (oz.)   19,793     20,465     21,837     20,656  
                         
                         
Pilar Mine                        
(In thousands of U.S. dollars)   Q2–16     Q1–16     Q4–15     Q3–15  
Cost of sales including depletion, depreciation and amortization   22,554     19,726     19,237     23,000  
Depletion, depreciation and amortization   (8,782 )   (7,577 )   (5,682 )   (8,636 )
Adjustments:                        
Inventory movement and adjustments(1)   1,713     1,626     (374 )   (367 )
Cash costs(2)   15,485     13,775     13,181     13,997  
                         
Cost of sales including depletion, depreciation and amortization per gold ounce sold   1,023     914     851     1,069  
Cash cost per gold ounce produced(2)   679     641     618     652  
                         
Gold ounces produced during the period (oz.)   22,806     21,848     21,326     21,468  
Gold ounces sold during the period (oz.)   22,047     21,586     22,617     21,510  
                         
                         
Fazenda Brasileiro Mine                        
(In thousands of U.S. dollars)   Q2–17     Q1–17     Q4–16     Q3–16  
Cost of sales including depletion, depreciation and amortization   14,624     16,452     20,530     17,072  
Depletion, depreciation and amortization   (3,189 )   (6,591 )   (5,870 )   (3,792 )
Adjustments:                        
Inventory movement and adjustments(1)   1,135     1,932     (896 )   (355 )
Cash costs(2)   12,570     11,793     13,764     12,925  
                         
Cost of sales including depletion, depreciation and amortization per gold ounce sold   1,145     1,188     1,074     998  
Cash cost per gold ounce produced(2)   892     793     753     751  
                         
Gold ounces produced during the period (oz.)   14,092     14,872     18,279     17,211  
Gold ounces sold during the period (oz.)   12,776     13,849     19,110     17,100  
                         
                         
Fazenda Brasileiro Mine                        
(In thousands of U.S. dollars)   Q2–16     Q1–16     Q4–15     Q3–15  
Cost of sales including depletion, depreciation and amortization   17,784     14,368     20,054     19,598  
Depletion, depreciation and amortization   (5,484 )   (3,556 )   (8,394 )   (8,116 )
Adjustments:                        
Inventory movement and adjustments(1)   (50 )   (910 )   (914 )   155  
Cash costs(2)   12,250     9,902     10,746     11,637  
                         
Cost of sales including depletion, depreciation and amortization per gold ounce sold   1,008     731     1,210     1,147  
Cash cost per gold ounce produced(2)   726     536     599     686  
                         
Gold ounces produced during the period (oz.)   16,873     18,524     17,953     16,963  
Gold ounces sold during the period (oz.)   17,650     19,657     16,577     17,090  
                         
                               
RDM, Brazil                              
(In thousands of U.S. dollars)   Q2–17     Q1–17     Q4–16     Q3–16     Q2–16  
Cost of sales including depletion, depreciation and amortization   11,387     16,278     13,660     12,150     13,080  
Depletion, depreciation and amortization   (2,139 )   (1,705 )   (2,477 )   (849 )   (1,217 )
Adjustments:                              
Inventory movement and adjustments(1)   (694 )   64     (2,278 )   (2,794 )   (1,334 )
Cash costs(2)   8,554     14,637     8,905     8,507     10,529  
                               
Cost of sales including depletion, depreciation and amortization per gold ounce sold   1,125     1,064     1,494     1,096     1,079  
Cash cost per gold ounce produced(2)   869     964     888     986     807  
                               
Gold ounces produced during the period (oz.)   9,844     15,184     10,028     8,628     13,058  
Gold ounces sold during the period (oz.)   10,122     15,301     9,146     11,081     12,654  
                               
 
Notes:
(1) Inventory movement and adjustment represent the difference between the costs of production (which are based on ounces produced) and the cost of sales (which is based on ounces sold). The timing difference between the units sold and the costs of those units requires an adjustment to reflect the nature of the underlying metric.
(2) A non–GAAP financial measure.
(3) RDM was acquired during Q2, 2016, therefore Q3 2015 to Q1 2016 is not applicable
   

Adjusted EBITDA

The Company uses the non–GAAP financial measure “Adjusted EBITDA” because it believes it provides investors with useful information to evaluate its performance and understand its ability to service and/or incur indebtedness.

The Company defines Adjusted EBITDA as net loss, before income tax recovery (expense), depletion, depreciation and amortization, impairment and reversals of mining properties, interest expense, share–based compensation, and non–recurring provisions and other adjustments.

The term “Adjusted EBITDA” has no standard meaning and therefore, the Company's definitions are unlikely to be comparable to similar measures presented by other companies and should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS and is not necessarily indicative of operating costs, operating profit or cash flows presented under IFRS.

Reconciliation of Net Loss to Adjusted EBITDA (Based on Condensed Consolidated Interim Financial Statements unless otherwise noted)

         
  For the three months ended   For the six months ended  
(In thousands of U.S. dollars) Q2 2017   Q2 2016   Q2 2017   Q2 2016  
Net earnings   (7,385 )   10,315     (4,994 )   20,790  
Adjustments:                        
Income tax expense/(recoveries)   2,843     (14,432 )   (6,687 )   (22,122 )
Depletion, depreciation and amortization   11,541     15,752     24,906     26,558  
Foreign exchange (gain)/loss   (1,252 )   3,619     7     3,017  
Bank, financing fees, interest expense and other   1,606     449     2,624     737  
Provision/(recovery) on indirect tax credits   1,908     1,624     (1,123 )   4,397  
Stock based compensation   2,002     1,742     3,744     3,484  
Unrealized (gain)/loss on foreign exchange hedges   (4,772 )       528      
Adjusted EBITDA $ 6,491   $ 19,069   $ 19,005   $ 36,861  
                         

Adjusted Earnings or Loss

The Company uses the non–GAAP financial measure “Adjusted earnings or loss” because it believes this measure provides useful information to investors to evaluate the Company's performance by excluding certain cash and non–cash charges. The presentation of Adjusted earnings or loss is not meant to be a substitute for net earnings or loss or net earnings or loss per share presented in accordance with IFRS, but rather should be evaluated in conjunction with such IFRS measures. Adjusted earnings or loss is calculated as net earnings excluding (a) stock based compensation, (b) unrealized foreign exchange (gains) losses related to revaluation of deferred income tax asset and liability on non–monetary items, (c) unrealized foreign exchange (gains) losses related to other items, (d) impairment losses and reversals, (e) deferred income tax expense (recovery) on the translation of foreign currency inter corporate debt, (f) periodic tax adjustments to historical deferred income tax balances relating to changes in enacted tax rates and (g) non–cash provisions and any other non–recurring adjustments. Non–recurring adjustments from unusual events or circumstances are reviewed from time to time based on materiality and the nature of the event or circumstance. Earnings adjustments for the comparative period reflect continuing operations.

The terms “Adjusted earnings or loss” has no standardized meaning prescribed by IFRS and therefore the Company's definitions are unlikely to be comparable to similar measures presented by other companies.

For more information, see the Condensed Consolidated Interim Financial Statements and the related notes.

Reconciliation of Net Loss to Adjusted Earnings or Loss (Based on Condensed Consolidated Interim Financial Statements unless otherwise noted)

         
  For the three months ended
June 30,
  For the six months ended
June 30,
 
(In thousands of U.S. dollars) 2017   2016   2017   2016  
Net earnings $ (7,385 ) $ 10,315   $ (4,994 ) $ 20,790  
Adjustments:                        
Foreign exchange loss/(gain)   (1,252 )   3,619     7     3,017  
Unrealized (gain)/loss on foreign exchange hedges   (4,772 )       528      
Provision/(recovery) on indirect tax credits   1,908     1,624     (1,123 )   4,397  
Business transaction costs       1,613     848     3,823  
Stock based compensation   2,002     1,742     3,744     3,484  
Non–cash tax effect on unrealized foreign exchange losses/(gains)   6,074     (15,487 )   (3,262 )   (29,281 )
Tax impact of adjustments   1,202     330     3,093     809  
Other   (1,336 )   (1,441 )   82     (3,490 )
Adjusted (loss)/earnings $ (3,559 ) $ 2,315   $ (1,077 ) $ 3,549  
                         

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

         
  For the three months ended
June 30,
  For the six months ended
June 30,
 
(In thousands of United States Dollars), (unaudited) 2017   2016   2017   2016  
Revenue from mining operations $ 52,853   $ 65,154   $ 112,352   $ 112,287  
Cost of sales excluding depletion, depreciation and amortization   (37,105 )   (38,513 )   (77,423 )   (60,974 )
Gross margin excluding depletion, depreciation and amortization   15,748     26,641     34,929     51,313  
Depletion, depreciation and amortization   (11,541 )   (15,752 )   (24,906 )   (26,558 )
Mine operating earnings   4,207     10,889     10,023     24,755  
                         
Expenses                        
General and administrative   (6,458 )   (5,665 )   (11,548 )   (10,917 )
Other operating expense (Note 12)   (4,774 )   (4,525 )   (4,598 )   (10,263 )
Operating (loss)/earnings   (7,025 )   699     (6,123 )   3,575  
Foreign exchange gain/(loss)   1,252     (3,619 )   (7 )   (3,017 )
Unrealized foreign exchange hedges gain/(loss)   4,772         (528 )    
Finance expense (Note 13)   (3,541 )   (1,197 )   (5,023 )   (1,890 )
(Loss)/earnings before income taxes   (4,542 )   (4,117 )   (11,681 )   (1,332 )
Income tax (expense)/recoveries (Note 14)   (2,843 )   14,432     6,687     22,122  
Net (loss)/earnings   (7,385 )   10,315     (4,994 )   20,790  
                         
Other comprehensive (loss)/income                        
Items that may be reclassified subsequently to profit or loss:                        
  Change in fair value of hedging instruments, net of tax (Note 16)   (12,136 )       2,861      
Total comprehensive (loss)/income $ (19,521 ) $ 10,315   $ (2,133 ) $ 20,790  
                         
Net (loss)/earnings per share                        
  Net (loss)/earnings per share (basic) (Note 15) $ (0.07 ) $ 0.44   $ (0.04 ) $ 0.88  
  Net (loss)/earnings per share (diluted) (Note 15) $ (0.07 ) $ 0.41   $ (0.04 ) $ 0.83  
Weighted average number of shares outstanding (Note 15)                        
  Basic   112,527,429     23,500,000     112,527,429     23,500,000  
  Diluted   112,527,429     25,000,000     112,527,429     25,000,000  
                         

CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS

         
  For the three months ended
June 30,
  For the six months ended
June 30,
 
(In thousands of United States Dollars), (unaudited) 2017   2016   2017   2016  
Operating activities                
Loss before income tax expense $ (4,542 ) $ (4,117 ) $ (11,681 ) $ (1,332 )
Adjustments to reconcile loss before income taxes to operating cash flows:                        
  Depletion, depreciation and amortization   11,541     15,752     24,906     26,558  
  Unrealized foreign exchange (gain)/loss   (1,252 )   3,619     7     3,017  
  Unrealized foreign exchange hedge (gain)/loss   (4,772 )       528      
  Finance expense   3,541     1,197     5,023     1,890  
  Other non–cash operating expenses (Note 17 b)   4,719     3,506     1,982     7,877  
  Amortization of deferred revenue on advance of metal sales   (4,425 )       (4,425 )    
Advance metal sales           4,425      
Decommissioning, restoration and similar liabilities paid   (537 )   (567 )   (941 )   (652 )
Income taxes paid       (708 )   (88 )   (2,416 )
Cash flows from operating activities before net change in working capital $ 4,273   $ 18,682   $ 19,736   $ 34,942  
Net change in working capital (Note 17 a)   (6,465 )   (2,571 )   (25,970 )   (10,080 )
Cash flows (used in) from operating activities $ (2,192 ) $ 16,111   $ (6,234 ) $ 24,862  
Investing activities                        
Property, plant and equipment expenditures   (15,757 )   (15,419 )   (34,568 )   (24,126 )
Acquisition of Mineração Riacho dos Machados Ltda (Note 3)       (2,832 )       (50,225 )
Cash flows used in investing activities $ (15,757 ) $ (18,251 ) $ (34,568 ) $ (74,351 )
Financing activities                        
Proceeds from long–term debt (Note 11) $ 15,000   $   $ 50,000   $  
Related party financing       3,632         51,361  
Interest and other finance expenses paid   (1,867 )       (3,943 )    
Cash flows from financing activities $ 13,133   $ 3,632   $ 46,057   $ 51,361  
Effect of foreign exchange on cash   (281 )   380     (757 )   757  
(Decrease)/Increase in cash $ (5,097 ) $ 1,872   $ 4,498   $ 2,629  
Cash beginning of period $ 16,609   $ 4,723   $ 7,014   $ 3,966  
Cash end of period $ 11,512   $ 6,595   $ 11,512   $ 6,595  
                         

CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS

         
(In thousands of United States Dollars) As at June 30, 2017 (unaudited)   As at
December 31, 2016
 
Assets            
Current assets:            
Cash $ 11,512   $ 7,014  
Trade and other receivables   653     154  
Inventories (Note 5)   36,136     29,620  
Derivative related assets (Note 7)   4,716     1,328  
Income taxes recoverable   1,499      
Other current assets (Note 6)   12,894     12,777  
    67,410     50,893  
Non–current assets:            
Property, plant and equipment (Note 8)   483,132     481,746  
Deferred tax assets   9,670     6,167  
Other non–current asset (Note 6)   14,168     2,893  
Total assets $ 574,380   $ 541,699  
             
Liabilities            
Current liabilities:            
Trade and other payables (Note 9) $ 38,538   $ 56,066  
Income taxes payable   5,820     2,998  
Other financial liabilities   1,841     1,414  
Other provisions and liabilities (Note 10)   3,533     5,243  
    49,732     65,721  
Non–current liabilities:            
Long–term debt (Note 11)   47,704      
Decommissioning, restoration and similar liabilities   38,621     36,871  
Deferred income tax liabilities   7,249     11,413  
Other non–current provisions and liabilities (Note 10)   6,671     4,902  
Total liabilities   149,977     118,907  
             
Equity            
Share capital   427,858     427,858  
Reserves   77,280     70,675  
Deficit   (80,735 )   (75,741 )
Total equity   424,403     422,792  
Total equity and liabilities $ 574,380   $ 541,699  
             

Cyberinc included in “Cool Vendor” list by Gartner in Endpoint, Mobile, Network and Gateway Security, 2017

SAN RAMON, CA—(Marketwired – August 01, 2017) – Cyberinc, a global leader in cybersecurity, today announced that it has been included as a Cool Vendor in the Endpoint, Mobile, Network and Gateway Security, 2017 report published by Gartner, Inc. This report by Gartner, mentions a select list of emerging security technology companies that lead the charter in mobile security and operational technology (OT) security with their innovative and interesting product & services portfolio.

This is a continuing testimony to Cyberinc's Isla malware isolation system — that uses an innovative Isolation approach to defeating web–based malware. The report aims to advocate security and risk management leaders to consider new vendors with innovative and impactful security technologies that support secure endpoint, mobile, network and gateway technologies.

As per the 2017 study, “Security and risk management leaders overseeing endpoint and mobile security should evaluate the isolation of browser sessions from the rest of the employee's desktop and the enterprise internal network and systems to reduce the ability of attackers to compromise enterprise systems,” Cyberinc has been positioned as a Cool Vendor in the report owing to Isla's innovative and intriguing premise that helps build secure digital enterprises by preventing all web–based malware from entering their IT perimeter, while ensuring a similar end–user experience by:

  • assuming that all web content is bad, and therefore all of it must be isolated
  • transforming content into harmless pixels ensuring malware can't attack the endpoint

As per leading industry reports*, with over 80% of malware being delivered through the browsers, Isla's 'isolation' approach ensures complete freedom from malware, as against the traditional 'detect and respond' methodology. Organizations spend large sums on traditional defenses like AV and firewalls but still suffer from successful malware attacks and their associated costs on a regular basis. CIOs and CISOs recognize the need for a different approach, and the Isolation approach made real by Isla addresses their problem in a simple, effective and unique way. Isla effectively addresses all malicious web threats, stopping zero–day attacks, malvertising attacks, transparent drive–by downloads and other complex web threats.

“We are delighted to be included in the list of Cool Vendors by Gartner. With enterprises adopting new technologies and the emergence of a complex threat landscape, there is a clear need to redirect focus from malware detection — which can never be 100% accurate — to malware isolation to ensure web freedom. Buoyed by a slew of sophisticated attacks on one side, and the need for building a proactive security stance by enterprises on the other, we are seeing some great traction across the globe for Isla.” said Samir Shah, CEO, Cyberinc. “This recognition by Gartner is a testament of our innovation and technology leadership, commitment to building secure digital businesses through Isolation and particularly Isla.”

About the Gartner Report
The Gartner report, Cool Vendors in Endpoint, Mobile, Network and Gateway Security, 2017, co–authored by Analyst(s): John Girard, Lawrence Orans, Ruggero Contu, Manjunath Bhat, Dionisio Zumerle was published on June 08, 2017.

Gartner Disclaimer
Gartner does not endorse any vendor, product or service depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner research publications consist of the opinions of Gartner's research organization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.

Note: Erstwhile Spikes Security (now part of Cyberinc, An Aurionpro Company) had been originally featured in The Gartner “Cool Vendors in Security Infrastructure Protection, 2015″

About Cyberinc
Cyberinc is a subsidiary of Aurionpro and delivers advanced security solutions for enterprises. Its offerings include secure, scalable, high performance security products that protect from cyber–attacks, and services that help enterprises transition to next generation access management systems.

For more information, please visit: www.cyberinc.com.

*Sources: 81% delivered through browsers – Ponemon Institute 2015

TriStar Discovers Significant New Gold Reefs at Castelo de Sonhos

SCOTTSDALE, AZ—(Marketwired – August 01, 2017) – Assay results from reverse circulation (RC) drilling at the Castelo de Sonhos (CDS) gold project of TriStar Gold Inc. (the “Company” or “TriStar”) (TSX VENTURE: TSG) continue to show significant intervals in new holes. “We're glad that the new drilling is consistent with our exploration target concept,” says Nick Appleyard, TriStar's President and CEO. “We've known since last year that we've got considerable potential for growing the resources along the strike of the mineralized conglomerate. But the July results from in–fill holes in the heart of Esperança South now demonstrate significant upside potential even in areas where indicated resources were previously reported. Thick intervals running well above the deposit average point to potential additional resources beyond the pit shell that constrained the 2014 resource.”

Drilling will continue through August into early September, reaching a planned 120 to 150 RC holes, at which time a new mineral resource will be estimated, followed by the completion of an initial scoping study (PEA). The PEA is scheduled to be completed before year end.

New reefs identified in heart of the deposit

Figure 1 shows a cross–section through an area where indicated resources were reported in 2014. On this section only one drill hole (CSH–12–083) was previously available for resource estimation; one thick mineralized interval in this hole controlled the location of the pit shell within which resources were reported. New holes within ±50m of this section now make it apparent that the pit shell used for the next resource update will be larger, and will include thick reefs (with true thickness >10m) that lie outside the previous pit shell, with gold grades above the project average. In particular, CSH–17–191 encountered 14m running at an average of 3.2 g/t, with several shorter intervals above 5 g/t.

Grades and thicknesses remain strong in extensions

Figure 2 shows the location of the 93 RC holes that have been completed in the Esperança South and Center regions of the project. All RC holes are vertical, and drilled to a target depth of 120m. A few holes were terminated short of their 120m target due to local conditions; any hole that reaches less than half of its target length is deemed to be abandoned prematurely, and will be redrilled. Table 1 summarizes the significant intervals (using a 0.4 g/t cutoff) not previously reported in holes for which assays were available for more than half of the sample intervals.

Several individual intervals in these new holes run above 10 g/t, with CSH–17–188 reaching 27.8 g/t. Some of the individual reefs in these new holes are considerably thicker than the deposit average, which has historically been approximately 4m. With all of the new drilling being vertical, to a target depth of 120m, all of the reported significant intervals are within reach of an open pit. Although diamond drilling has identified strong mineralization below 120m, the upcoming PEA will focus only on a stand–alone open pit mine, and will not address possible longer term potential from underground mining.

 
Table 1. Significant intervals for RC holes not previously reported.
                 
Hole       From   To   Length1 and Au grade
SC17–177       No significant intervals        
RC17–178       23   25   2m @ 1.3 g/t
RC17–179       59   60   1m @ 0.4 g/t
        78   79   1m @ 0.7 g/t
RC17–1802       21   24   3m @ 1.8 g/t
        45   46   1m @ 0.5 g/t
        110   111   1m @ 0.6 g/t
        115   116   1m @ 0.5 g/t
        118   120   2m @ 0.5 g/t
RC17–182       32   34   2m @ 0.4 g/t
RC17–183       45   46   1m @ 1.2 g/t
        98   100   2m @ 2.8 g/t
RC17–184   No significant intervals
RC17–185       28   30   2m @ 2.0 g/t
        66   68   2m @ 10.6 g/t
    Including   66   67   1m @ 18.1 g/t
        109   110   1m @ 9.1 g/t
RC17–186       42   43   1m @ 6.5 g/t
RC17–187       31   35   4m @ 1.5 g/t
RC17–188       27   31   4m @ 8.3 g/t
    Including   30   31   1m @ 27.8 g/t
RC17–190       47   52   5m @ 3.4 g/t
    Including   47   48   1m @ 7.6 g/t
    Including   51   52   1m @ 5.1 g/t
        114   115   1m @ 2.5 g/t
RC17–191       20   21   1m @ 0.5 g/t
        27   29   2m @ 2.4 g/t
        35   38   3m @ 1.2 g/t
        50   64   14m @ 3.2 g/t
    Including   50   51   1m @ 5.3 g/t
    Including   54   55   1m @ 5.5 g/t
    Including   58   59   1m @ 14.6 g/t
    Including   62   63   1m @ 5.1 g/t
RC17–192       24   25   1m @ 1.4 g/t
        98   99   1m @ 1.5 g/t
        105   107   2m @ 4.1 g/t
    Including   106   107   1m @ 7.1 g/t
RC17–193   <50% of assays available
RC17–195   No significant intervals (53% of assays available)
RC17–196       80   84   4m @ 0.6 g/t
        98   100   2m @ 2.2 g/t
RC17–202       60   67   7m @ 4.8 g/t
    Including   65   67   2m @ 11.0 g/t
1All new holes are vertical, through reefs that dip at 25–30°, making the down–hole thicknesses reported here 10–15% longer than true thickness. 
2Assays were previously available for the bottom half of Hole 180, where significant intervals were previously reported. The 21–24m and 45–46m intervals in this hole are reported here for the first time.
 

Sample analysis procedures and QA/QC protocols

Sample preparation and analytical work for all of the results reported here were carried out by ALS laboratories, with sample preparation done at its lab in Goiania, Goias and 1Kg Leachwell assays at its lab in Lima, Peru; both of these ALS facilities are ISO 9001:2008 and 14001:2004 certified. ALS uses industry–standard analytical methods and have internal QA/QC programs to monitor the reliability of their work. Independently of the labs, TriStar runs its own external QA/QC program, using standards, blanks and duplicates inserted into the sample processing stream at a rate of one per 10 samples.

Update on new Brazilian mining law

On July 25, 2017, Brazilian President Michel Temer signed into law three provisional measures, referred to as MP 789, MP 790 and MP 791, that affect mining projects throughout the country. They take effect immediately, with Congress being allowed a reasonable period of time to review and amend them.

MP 789 addresses taxation and royalty issues; its principal effect on the Castelo de Sonhos project is to increase the government royalty on gold production from 1% to 2%.

MP 790 modernized the country's mining code, parts of which had become inconsistent with other regulations since it was last updated, more than 20 years ago. These changes include: an initiative to align Brazil's reporting codes with international reporting codes such as NI 43–101; the ability to extend the period during which geology and engineering studies can be done; ending the possibility of a mineral concession being claimed if the holder of the rights is late in filing certain reports; specific guidance on mine closure; and changes to the schedule of reporting deadlines. All of these are helpful to TriStar as it works to advance the Castelo de Sonhos project.

“We welcome all of these changes,” says Nick Appleyard. “They improve transparency in the regulatory framework, and are designed to relieve companies and the regulators from political pressure. All of this should make it easier and quicker for us to bring Castelo de Sonhos through the feasibility and permitting process, and to construct a successful and profitable mine.”

TriStar's Vice–President, R. Mohan Srivastava (P.Geo.), is the QP for this press release and has prepared or supervised the preparation of the scientific or technical information in this press release.

About TriStar:

TriStar Gold is an exploration and development company focused on precious metals properties in the Americas that have potential to become significant producing mines. The Company's current flagship property is Castelo de Sonhos in Pará State, Brazil. The Company's shares are listed on the TSX Venture Exchange under the symbol TSG. Further information is available at www.tristargold.com.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release. No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.

Forward–Looking Statements

Certain statements contained in this press release may constitute forward–looking statements under Canadian securities legislation which are not historical facts and are made pursuant to the “safe harbour” provisions under the United States Private Securities Litigation Reform Act of 1995. Generally, forward–looking information can be identified by the use of forward–looking terminology such as “expects” or “it is expected”, or variations of such words and phrases or statements that certain actions, events or results “will” occur. Forward looking statements in this press release include, the scope and success of the planned exploration program at the Castelo de Sonhos project and the Company's opinion that it has clear title to the Castelo de Sonhos property Such forward–looking statements are based upon the Company's reasonable expectations and business plan at the date hereof, which are subject to change depending on economic, political and competitive circumstances and contingencies. Readers are cautioned that such forward–looking statements involve known and unknown risks, uncertainties and other factors that may cause a change in such assumptions and the actual outcomes and estimates to be materially different from those estimated or anticipated future results, achievements or position expressed or implied by those forward–looking statements. Risks, uncertainties and other factors that could cause the Company's plans to change include changes in demand for and price of gold and other commodities (such as fuel and electricity) and currencies; changes or disruptions in the securities markets; legislative, political or economic developments in Brazil; the need to obtain permits and comply with laws and regulations and other regulatory requirements; the possibility that actual results of work may differ from projections/expectations or may not realize the perceived potential of the Company's projects; risks of accidents, equipment breakdowns and labour disputes or other unanticipated difficulties or interruptions; the possibility of cost overruns or unanticipated expenses in development programs; operating or technical difficulties in connection with exploration, mining or development activities; the speculative nature of gold exploration and development, including the risks of diminishing quantities of grades of reserves and resources; and the risks involved in the exploration, development and mining business. Although management of the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward–looking statements or forward–looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. The Company disclaims any intention or obligation to update or revise any forward–looking statements whether as a result of new information, future events or otherwise, except as required by applicable securities laws.

Image Available: http://www.marketwire.com/library/MwGo/2017/8/1/11G143567/Images/PR_Aug2017_Fig01–689ef741ccccb649a19ecedbfe55725e.jpg
Image Available: http://www.marketwire.com/library/MwGo/2017/8/1/11G143567/Images/PR_Aug2017_Fig02–05b60bd9847d9cbd8d0284a2eb3afc7c.jpg

NMI Holdings, Inc. Reports Second Quarter 2017 Financial Results

EMERYVILLE, CA—(Marketwired – August 01, 2017) – NMI Holdings, Inc. (NASDAQ: NMIH) today reported net income of $6.0 million, or $0.10 per share, for the second quarter ended June 30, 2017. Results for the quarter include previously disclosed fees and expenses of approximately $3.1 million related to the May 2017 issuance of Insurance–Linked Notes (ILN). The company reported net income of $2.0 million, or $0.03 per share, in the second quarter of 2016.

Bradley Shuster, chairman and CEO of National MI, said, “In the second quarter, National MI again delivered solid financial results, including record pre–tax income, and continued to advance the key metrics that will drive realization of our mid–teens return objectives. We made significant strides in customer development, activating 36 new customers in the second quarter and 73 new customers for the year–to–date. We also continued to build a high–quality portfolio of insurance–in–force at a growth rate that leads our industry, while maintaining our focus on prudently and proactively managing risk, expenses, and capital.”

  • As of June 30, 2017, the company had primary insurance–in–force of $38.6 billion, up 11% from $34.8 billion at the prior quarter end and up 64% over $23.6 billion as of June 30, 2016.
  • Premiums earned for the quarter were $37.9 million, including $3.8 million attributable to cancellation of single premium policies, which compares with $33.2 million, including $2.5 million related to cancellations, in the prior quarter. Premiums earned in the second quarter of 2017 were up 46% over premium revenue of $26.0 million in the same quarter a year ago, which included $3.5 million related to cancellations.
  • NIW mix was 81% monthly premium product, which compares with 81% in the prior quarter and 63% in the second quarter of 2016.
  • Total underwriting and operating expenses in the second quarter were $28.0 million and include approximately $3.1 million of transaction costs related to the previously disclosed ILN issuance. This compares with total underwriting and operating expenses of $26.0 million, including financing–related transaction costs of $1.6 million in the prior quarter, and $23.2 million in the same quarter a year ago.
  • Claims expense for the quarter was $1.4 million, resulting in a loss ratio of 3.6%.
  • At quarter–end, cash and investments were $694 million, including $57 million at the holding company, and book equity was $495 million, equal to $8.27 per share.
  • At quarter–end, the company had total PMIERs available assets of $485 million, which compares with risk– based required assets under PMIERs of $298 million.
 
    Quarter   Quarter   Quarter        
    Ended   Ended   Ended   Change   Change
    6/30/2017   3/31/2017   6/30/2016   Q/Q   Y/Y
Primary Insurance–in–Force ($billions)   38.63   34.78   23.62   11%   64%
New Insurance Written – NIW ($billions)                    
    Monthly premium   4.10   2.89   3.70   42%   11%
    Single premium   0.94   0.67   2.14   40%   –56%
    Total   5.04   3.56   5.84   42%   –14%
 
Premiums Earned ($millions)   37.92   33.23   26.04   14%   46%
Underwriting & Operating Expense ($millions)   28.05   25.99   23.23   8%   21%
Claims Expense ($millions)   1.37   0.64   0.47   114%   191%
Loss Ratio   3.6%   1.9%   1.8%        
Cash & Investments ($millions)   694   671   654   3%   6%
Book Equity ($millions)   495   484   422   2%   17%
Book Value per Share   8.27   8.09   7.14   2%   16%
                     

Conference Call and Webcast Details

The company will hold a conference call and live webcast at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time. The webcast will be available on the company's website, www.nationalmi.com, in the “Investor Relations” section. The call also can be accessed by dialing (888) 734–0328 in the U.S., or (914) 495–8578 for international callers using Conference ID: 47660998, or by referencing NMI Holdings, Inc.

About National MI

National Mortgage Insurance Corporation (National MI), a subsidiary of NMI Holdings, Inc. (NASDAQ: NMIH), is a U.S.–based, private mortgage insurance company enabling low down payment borrowers to realize home ownership while protecting lenders and investors against losses related to a borrower's default. To learn more, please visit www.nationalmi.com.

Cautionary Note Regarding Forward–Looking Statements

Certain statements contained in this press release or any other written or oral statements made by or on behalf of the Company in connection therewith may constitute forward–looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (Securities Act), Section 21E of the Securities Exchange Act of 1934, as amended (Exchange Act), and the U.S. Private Securities Litigation Reform Act of 1995 (PSLRA). The PSLRA provides a “safe harbor” for any forward–looking statements. All statements other than statements of historical fact included in or incorporated by reference in this release are forward–looking statements, including any statements about our expectations, outlook, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believe,” “can,” “could,” “may,” “predict,” “assume,” “potential,” “should,” “will,” “estimate,” “plan,” “project,” “continuing,” “ongoing,” “expect,” “intend” and similar words or phrases. All forward–looking statements are only predictions and involve estimates, known and unknown risks, assumptions and uncertainties that may turn out to be inaccurate and could cause actual results to differ materially from those expressed in them. Many risks and uncertainties are inherent in our industry and markets. Others are more specific to our business and operations. Important factors that could cause actual events or results to differ materially from those indicated in such statements include, but are not limited to: changes in the business practices of the GSEs that may impact the use of private mortgage insurance as credit enhancement; our ability to remain an eligible mortgage insurer under the PMIERs, including the financial requirements, and other requirements of the GSEs, which they may change at any time; retention of our existing certificates of authority in each state and the District of Columbia (D.C.) and our ability to remain a mortgage insurer in good standing in each state and D.C.; our future profitability, liquidity and capital resources; actions of existing competitors, including governmental agencies like the Federal Housing Administration (FHA) and the Veterans Administration (VA), and potential market entry by new competitors or consolidation of existing competitors; developments in the world's financial and capital markets and our access to such markets, including reinsurance; adoption of new or changes to existing laws and regulations that impact our business or financial condition directly or the mortgage insurance industry generally or their enforcement and implementation by regulators; changes to the GSEs' role in the secondary mortgage market or other changes that could affect the residential mortgage industry generally or mortgage insurance in particular; potential future lawsuits, investigations or inquiries or resolution of current lawsuits or inquiries; changes in general economic, market and political conditions and policies, interest rates, inflation and investment results or other conditions that affect the housing market or the markets for home mortgages or mortgage insurance; our ability to successfully execute and implement our capital plans, including our ability to access the reinsurance market and to enter into, and receive approval of, reinsurance arrangements on terms and conditions that are acceptable to us, the GSEs and our regulators; our ability to implement our business strategy, including our ability to write mortgage insurance on high quality low down payment residential mortgage loans, implement successfully and on a timely basis, complex infrastructure, systems, procedures, and internal controls to support our business and regulatory and reporting requirements of the insurance industry; our ability to attract and retain a diverse customer base, including the largest mortgage originators; failure of risk management or pricing or investment strategies; emergence of unexpected claims and coverage issues, including claims exceeding our reserves or amounts we expected to experience; the inability of our counter–parties, including third party reinsurers, to meet their obligations to us; our ability to utilize our net operating loss carryforwards, which could be limited or eliminated in various ways, including if we experience an ownership change as defined in Section 382 of the Internal Revenue Code; failure to maintain, improve and continue to develop necessary information technology systems or the failure of technology providers to perform; ability to recruit, train and retain key personnel; and general economic downturns and volatility. These risks and uncertainties also include, but are not limited to, those set forth under the heading “Risk Factors” detailed in Item 1A of Part I of our Annual Report on Form 10–K for the year ended December 31, 2016, as subsequently updated through other reports we file with the SEC. All subsequent written and oral forward–looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these cautionary statements. We caution you not to place undue reliance on any forward–looking statement, which speaks only as of the date on which it is made, and we undertake no obligation to publicly update or revise any forward–looking statement to reflect new information, future events or circumstances that occur after the date on which the statement is made or to reflect the occurrence of unanticipated events except as required by law.

Investor Contact
John M. Swenson
Vice President, Investor Relations and Treasury
john.swenson@nationalmi.com
(510) 788–8417

Press Contact
Mary McGarity
Strategic Vantage Mortgage Public Relations
(203) 513–2721
MaryMcGarity@StrategicVantage.com

 
Consolidated statements of operations and comprehensive                          
income   For the three months ended June 30,     For the six months ended June 30,  
      2017     2016     2017     2016  
Revenues   (In Thousands, except for share data)  
  Net premiums earned   $ 37,917      $ 26,041      $ 71,142     $ 45,848    
  Net investment income     3,908       3,342       7,715       6,573    
  Net realized investment gains (losses)     188       61       130       (824 )  
  Other revenues     185       37       265       69    
Total revenues     42,198       29,481       79,252       51,666    
Expenses                                  
  Insurance claims and claims expenses     1,373       470       2,008       928    
  Underwriting and operating expenses     28,048       23,234       54,037       45,906    
Total expenses     29,421       23,704       56,045       46,834    
Other (expense) income                                  
  Gain (loss) from change in fair value of warrant liability     19       (59 )     (177 )     611    
  Interest expense     (3,300 )     (3,707 )     (6,794 )     (7,339 )  
Total other expense     (3,281 )     (3,766 )     (6,971 )     (6,728 )  
 
Income (loss) before income taxes     9,496       2,011       16,236       (1,896 )  
  Income tax expense     3,484             4,732          
Net income (loss)   $ 6,012     $ 2,011     $ 11,504     $ (1,896 )  
 
Earnings (loss) per share                                  
  Basic   $ 0.10     $ 0.03     $ 0.19     $ (0.03 )  
  Diluted   $ 0.10      $ 0.03     $ 0.18     $ (0.03 )  
 
Weighted average common shares outstanding                                  
Basic     59,823,396       59,105,613       59,576,747       59,005,983    
Diluted     63,010,362       59,830,899       62,688,563       59,005,983    
Loss Ratio(1)     3.6 %     1.8 %     2.8 %     2.0 %  
Expense Ratio(2)     74.0       89.2       76.0       100.1    
Combined ratio     77.6 %     91.0 %     78.8 %     102.1 %  
 
Net income (loss)   $ 6,012      $ 2,011     $ 11,504     $ (1,896 )  
Other comprehensive income, net of tax:                                  
  Net unrealized gains in accumulated other comprehensive income, net of tax expense of $1,388 and $0 for the three months ended June 30, 2017 and 2016, respectively, and $2,073 and $0 for the six months ended June 30, 2017 and 2016     2,822       8,670       4,017       17,771    
  Reclassification adjustment for losses (gains) included in net income, net of tax expense of $66 and $0 for the three months ended June 30, 2017 and 2016, respectively, and $45 and $0 for the six months ended June 30, 2017 and 2016     (122 )     (61 )     (84 )     824    
Other comprehensive income, net of tax     2,700       8,609       3,933       18,595    
Comprehensive income   $ 8,712     $ 10,620     $ 15,437     $ 16,699    
                                   
(1) Loss ratio is calculated by dividing the provision for insurance claims and claims expenses by net premiums earned.
(2) Expense ratio is calculated by dividing other underwriting and operating expenses by net premiums earned.
                                   
   
Consolidated balance sheets     June 30, 2017     December 31, 2016 (1)  
Assets     (In Thousands, except for share data)  
  Fixed maturities, available–for–sale, at fair value (amortized cost of $669,363 and $630,688 as of June 30, 2017 and December 31, 2016, respectively)   $ 673,695     $ 628,969  
  Cash and cash equivalents     20,035       47,746  
  Premiums receivable     17,795       13,728  
  Accrued investment income     3,867       3,421  
  Prepaid expenses     2,072       1,991  
  Deferred policy acquisition costs, net     34,206       30,109  
  Software and equipment, net     21,530       20,402  
  Intangible assets and goodwill     3,634       3,634  
  Prepaid reinsurance premiums     38,919       37,921  
  Deferred tax asset, net     45,771       51,434  
  Other assets     1,471       542  
Total assets   $ 862,995     $ 839,897  
   
Liabilities                
  Term loan   $ 143,990     $ 144,353  
  Unearned premiums     157,152       152,906  
  Accounts payable and accrued expenses     21,349       25,297  
  Reserve for insurance claims and claim expenses     5,048       3,001  
  Reinsurance funds withheld     32,042       30,633  
  Deferred ceding commission     4,830       4,831  
  Warrant liability, at fair value     3,544       3,367  
  Deferred tax liability, net            
Total liabilities     367,955       364,388  
Commitments and contingencies                
   
Shareholders' equity                
  Common stock – class A shares, $0.01 par value; 59,858,418 and 59,145,161 shares issued and outstanding as of June 30, 2017 and December 31, 2016, respectively (250,000,000 shares authorized)     598       591  
  Additional paid–in capital     580,499       576,927  
  Accumulated other comprehensive loss, net of tax     (1,354 )     (5,287 )
  Accumulated deficit     (84,703 )     (96,722 )
Total shareholders' equity     495,040       475,509  
Total liabilities and shareholders' equity   $ 862,995     $ 839,897  
                 
                 
(1)The 2016 prior period balance sheet has been revised. Please refer to our Form 10–Q for the quarter ended June 30, 2017 for further details.
 
   
Historical Quarterly Data   2017   2016
                    December     September              
      June 30       March 31       31(4)       30      June 30       March 31  
Revenues   (In Thousands, except for share data)
  Net premiums earned   $ 37,917     $ 33,225     $ 32,825     $ 31,808     $ 26,041     $ 19,807  
  Net investment income     3,908       3,807       3,634       3,544       3,342       3,231  
   
  Net realized investment (losses) gains     188       (58 )     65       66       61       (885 )
  Other revenues     185       80       105       102       37       32  
Total revenues     42,198       37,054       36,629       35,520       29,481       22,185  
Expenses                                                
  Insurance claims and claims expenses     1,373       635       800       664       470       458  
  Underwriting and operating expenses     28,048       25,989       23,281       24,037       23,234       22,672  
Total expenses     29,421       26,624       24,081       24,701       23,704       23,130  
   
Other expense     (3,281 )     (3,690 )     (5,490 )     (4,530 )     (3,766 )     (2,962 )
   
Income (loss) before income taxes     9,496       6,740       7,058       6,289       2,011       (3,907 )
  Income tax expense (benefit)     3,484       1,248       (52,664 )     114              
Net income (loss)   $ 6,012     $ 5,492     $ 59,722     $ 6,175     $ 2,011     $ (3,907 )
   
Earnings (loss) per share                                                
  Basic   $ 0.10     $ 0.09     $ 1.01     $ 0.10     $ 0.03     $ (0.07 )
  Diluted   $ 0.10     $ 0.09     $ 0.98     $ 0.10     $ 0.03     $ (0.07 )
   
Weighted average common shares                                                
outstanding                                                
Basic     59,823,396       59,183,973       59,140,011       59,130,401       59,105,613       58,936,694  
Diluted     63,010,362       62,338,856       61,229,338       60,284,746       59,830,899       58,936,694  
   
Other data                                                
Loss Ratio (2)     3.6 %     1.9 %     2.4 %     2.1 %     1.8 %     2.3 %
Expense Ratio (3)     74.0 %     78.2 %     70.9 %     75.6 %     89.2 %     114.5 %
Combined ratio     77.6 %     80.1 %     73.3 %     77.7 %     91.0 %     116.8 %
                                                 
(1) Other expense includes the gain from change in fair value of warrant liability, gain from settlement of warrants, and interest expense.
(2) Loss ratio is calculated by dividing the provision for insurance claims and claims expenses by net premiums earned.
(3) Expense ratio is calculated by dividing other underwriting and operating expenses by net premiums earned.
(4) The Q4 2016 quarterly data has been revised. Please refer to our Form 10–Q for the quarter ended June 30, 2017 for further details.
                                                 
 
New Insurance Written (NIW), Insurance in Force (IIF) and Premiums
The tables below present primary and pool NIW and IIF, as of the dates and for the periods indicated.
 
Primary NIW   Three months ended
    June 30, 2017   March 31,
2017
  December 31,
2016
  September
30, 2016
  June 30, 2016   March 31,
2016
    (In Millions)
Monthly   $ 4,099   $ 2,892   $ 3,904   $ 4,162   $ 3,700   $ 2,492
Single     938     667     1,336     1,695     2,138     1,762
Primary   $ 5,037   $ 3,559   $ 5,240   $ 5,857   $ 5,838   $ 4,254
                                     
 
Primary and pool IIF   As of
    June 30, 2017   March 31,
2017
  December 31,
2016
  September
30, 2016
  June 30, 2016   March 31,
2016
   
    (In Millions)
Monthly   $ 24,865   $ 21,551   $ 19,205   $ 16,038   $ 12,529   $ 9,210
Single     13,764     13,268     12,963     12,190     11,095     9,354
Primary     38,629     34,779     32,168     28,228     23,624     18,564
 
Pool     3,447     3,545     3,650     3,826     3,999     4,136
Total   $ 42,076   $ 38,324   $ 35,818   $ 32,054   $ 27,623   $ 22,700
                                     

The following table presents the amounts related to the 2016 QSR transaction, for the last four quarters.

                                 
  For the three months ended  
    June 30, 2017     March 31, 2017     December 31, 2016     September 30, 2016  
  In Thousands  
Ceded risk–in–force   $ 2,403,027     $ 2,167,745     $ 2,008,385     $ 1,778,235  
Ceded premiums written     (12,034 )     (10,292 )     (11,576 )     (38,977 )
Ceded premiums earned     (11,463 )     (9,865 )     (9,746 )     (2,885 )
Ceded claims and claims expenses     342       268       206       90  
Ceding commission written     2,407       2,058       2,316       7,795  
Ceding commission earned     2,275       2,065       1,752       551  
Profit commission     6,536       5,651       5,642       1,641  
                                 
   
Portfolio Statistics
The table below highlights trends in our primary portfolio as of the date and for the periods indicated.
   
Primary portfolio trends As of and for the three months ended  
    June 30, 2017     March 31,
2017
    December 31,
2016
    September 30,
2016
  June 30, 2016     March 31,
2016
 
 
    ($ Values In Millions)
New insurance written   $ 5,037     $ 3,559     $ 5,240     $ 5,857     $ 5,838     $ 4,254  
New risk written     1,242       868       1,244       1,415       1,411       1,016  
Insurance in force (1)     38,629       34,779       32,168       28,228       23,624       18,564  
Risk in force (1)     9,417       8,444       7,790       6,847       5,721       4,487  
Policies in force (count) (1)     161,195       145,632       134,662       119,002       100,547       79,700  
Weighted–average coverage (2)     24.4 %     24.3 %     24.2 %     24.3 %     24.2 %     24.2 %
Loans in default (count)     249       207       179       115       79       55  
Percentage of loans in default     0.2 %     0.1 %     0.1 %     0.1 %     0.1 %     0.1 %
Risk in force on defaulted loans   $ 14     $ 12     $ 10     $ 6     $ 4     $ 3  
Average premium yield (3)     0.41 %     0.40 %     0.44 %     0.48 %     0.47 %     0.45 %
Earnings from cancellations   $ 3.8     $ 2.5     $ 5.1     $ 5.8     $ 3.5       2.3 %
Annual persistency     83.1 %     81.3 %     80.7 %     81.8 %     83.3 %     82.7 %
Quarterly run–off (4)     3.4 %     2.9 %     4.6 %     5.3 %     4.2 %     3.5 %
                                                 
(1) Reported as of the end of the period.
(2) Calculated as end of period risk in force (RIF) divided by IIF.
(3) Calculated as net primary and pool premiums earned, net of reinsurance, divided by average gross IIF for the period, annualized.
(4) Defined as the percentage of IIF that remains on our books after any 12–month period.
(5) Defined as the percentage of IIF that are no longer on our books after any 3–month period
                                                 

The tables below reflect our total primary NIW by FICO, loan–to–value (LTV) ratio, and purchase/refinance mix for the periods indicated.

         
Primary NIW by FICO    For the three months ended 
      June 30, 2017     March 31, 2017     June 30, 2016
        ($ In Millions)   
  >= 760   $ 2,376 $ 1,683 $ 3,160
  740–759     793     551     961
  720–739     626     456     672
  700–719     568     396     541
  680–699     368     264     308
  <=679     306     209     196
Total   $ 5,037   $ 3,559   $ 5,838
Weighted average FICO     749     749     756
                   
   
Primary NIW by LTV   For the three months ended  
      June 30, 2017       March 31, 2017       June 30, 2016  
    (In Millions)  
  95.01% and above   $ 474     $ 274     $ 362  
  90.01% to 95.00%     2,297       1,612       2,633  
  85.01% to 90.00%     1,506       1,101       1,732  
  85.00% and below     760       572       1,111  
Total   $ 5,037     $ 3,559     $ 5,838  
Weighted average LTV     92.18 %     92.00 %     91.73 %
   
   
Primary NIW by purchase/refinance mix     For the three months ended  
      June 30, 2017       March 31, 2017       June 30, 2016  
      (In Millions)  
  Purchase   $ 4,518     $ 2,984     $ 4,199  
  Refinance     519       575       1,639  
Total   $ 5,037     $ 3,559     $ 5,838  
                         

The table below reflects a summary of our primary IIF and RIF by book year as of the dates indicated.

Primary IIF and RIF As of June 30, 2017 
  IIF   RIF
   (In Millions)
June 30, 2017 $ 8,460   $ 2,078
2016 19,288   4,650
2015 9,243   2,284
2014 1,596   395
2013 42   10
Total $ 38,629   $ 9,417

The tables below reflect our total primary IIF and RIF by FICO and LTV and total primary RIF by loan type as of the dates indicated.

     
Primary IIF by FICO   As of
      June 30, 2017     March 31, 2017     June 30, 2016
    (In Millions)
  >= 760   $ 19,224   $ 17,408   $ 11,929
  740–759     6,269     5,658     3,876
  720–739     4,927     4,460     3,082
  700–719     3,973     3,533     2,341
  680–699     2,615     2,336     1,561
  <=679     1,621     1,384     835
Total   $ 38,629   $ 34,779   $ 23,624
                   
 
Primary RIF by FICO   As of
      June 30, 2017     March 31, 2017     June 30, 2016
    (In Millions)
  >= 760   $ 4,720   $ 4,253   $ 2,895
  740–759     1,535     1,383     951
  720–739     1,198     1,081     750
  700–719     960     851     566
  680–699     627     556     369
  <=679     377     320     190
Total   $ 9,417   $ 8,444   $ 5,721
 
 
Primary IIF by LTV     As of
      June 30, 2017     March 31, 2017     June 30, 2016
      (In Millions)
  95.01% and above   $ 2,367   $ 1,931   $ 1,049
  90.01% to 95.00%     17,441     15,601     10,574
  85.01% to 90.00%     12,157     11,058     7,754
  85.00% and below     6,664     6,189     4,247
Total   $ 38,629   $ 34,779   $ 23,624
 
 
Primary RIF by LTV     As of
      June 30, 2017     March 31, 2017     June 30, 2016
      (In Millions)
  95.01% and above   $ 648   $ 533   $ 293
  90.01% to 95.00%     5,120     4,585     3,116
  85.01% to 90.00%     2,893     2,626     1,838
  85.00% and below     756     700     474
Total   $ 9,417   $ 8,444   $ 5,721
 
 
Primary RIF by Loan Type     As of
      June 30, 2017     March 31, 2017     June 30, 2016
 
Fixed     98%     99%     98%
Adjustable rate mortgages:                  
  Five years and longer     2     1     2
Total     100%     100%     100%
                   

The table below reflects a summary of the change in total primary IIF during the periods indicated.

   
Primary IIF   For the three months ended  
     June 30, 2017      March 31, 2017      June 30, 2016  
    (In Millions)  
IIF, beginning of period   $ 34,779     $ 32,168     $ 18,564  
  NIW     5,037       3,559       5,838  
  Cancellations and other reductions     (1,187 )     (948 )     (778 )
IIF, end of period   $ 38,629     $ 34,779     $ 23,624  
                         
   
Geographic Dispersion  
The following table shows the distribution by state of our primary RIF as of the periods indicated.  
   
   
Top 10 primary RIF by state   As of  
    June 30, 2017     March 31, 2017     June 30, 2016  
California   13.8 %   13.8 %   13.0 %
Texas   7.5     7.2     6.8  
Virginia   6.0     6.3     6.4  
Florida   4.4     4.4     5.0  
Arizona   4.2     4.1     3.8  
Colorado   3.9     3.9     4.1  
Maryland   3.7     3.7     3.4  
Utah   3.7     3.6     3.4  
Pennsylvania   3.6     3.6     3.5  
Michigan   3.6     3.7     4.1  
Total   54.4 %   54.3 %   53.5 %
                   

The following table shows portfolio data by book year, as of June 30, 2017.

   
    As of June 30, 2017  
    Original
Insurance
Written
  Remaining
Insurance in
Force
  %
Remaining
of Original
Insurance
    Policies
Ever in
Force
  Number of
Policies in
Force
  Number
of Loans
in Default
  # of
Claims
Paid
  Incurred
Loss Ratio
(Inception to
Date) (1)
   

Cumulative
default rate (2)

 
   
   
Book year  
    ($ Values in Millions)  
2013   $ 162   $ 42   26 %   655   212   1   1   0.2 %   0.3 %
2014     3,451     1,596   46 %   14,786   7,963   53   7   3.5 %   0.4 %
2015     12,422     9,243   74 %   52,548   41,747   128   13   2.7 %   0.3 %
2016     21,187     19,288   91 %   83,626   78,111   67   2   1.3 %   0.1 %
2017   $ 8,596   $ 8,460   98 %   33,593   33,162       %   %
Total   $ 45,818   $ 38,629         185,208   161,195   249   23            
                                               
(1) The ratio of claims incurred (paid and reserved) divided by cumulative premiums earned, net of reinsurance.  
(2) The sum of claims paid ever to date and notices of default as of the end of the period divided by policies ever in force.  
                                               

The following table provides a reconciliation of the beginning and ending reserve balances for primary insurance claims and claims expenses:

                 
    For the three months ended     For the six months ended  
    June 30, 2017     June 30, 2016     June 30, 2017     June 30, 2016  
   
    (In Thousands)  
Beginning balance   $ 3,761     $ 1,137     $ 3,001     $ 679  
Less reinsurance recoverables (1)     (564 )           (297 )      
Beginning balance, net of reinsurance recoverables     3,197       1,137       2,704       679  
   
Add claims incurred:                                
  Claims and claim expenses incurred:                                
    Current year (2)     1,376       560       2,331       1,113  
    Prior years     (3 )     (90 )     (323 )     (185 )
Total claims and claims expenses incurred     1,373       470       2,008       928  
   
Less claims paid:                                
  Claims and claim expenses paid:                                
    Current year (2)                        
    Prior years (3)     421       132       563       132  
Total claims and claim expenses paid     421       132       563       132  
   
Reserve at end of period, net of reinsurance                                
recoverables     4,149       1,475       4,149       1,475  
Add reinsurance recoverables (1)     899             899        
Balance, June 30   $ 5,048     $ 1,475     $ 5,048     $ 1,475  
                                 
(1) Related to ceded losses recoverable on our 2016 quota–share reinsurance transaction, included in “Other Assets” on the Condensed Consolidated Balance Sheet.  
(2) Related to insured loans with their most recent defaults occurring in the current year. For example, if a loan had defaulted in a prior year and subsequently cured and later re–defaulted in the current year, that default would be included in the current year.  
(3) Related to insured loans with defaults occurring in prior years, which have been continuously in default since that time.  
                                 

The following table provides a reconciliation of the beginning and ending count of loans in default for the periods indicated.

             
    Three months ended     Six months ended  
   
    June 30, 2017     June 30, 2016     June 30, 2017     June 30, 2016  
Beginning default inventory   207     55     179     36  
Plus: new defaults   147     50     271     89  
Less: cures   (97 )   (23 )   (189 )   (43 )
Less: claims paid   (8 )   (3 )   (12 )   (3 )
Ending default inventory   249     79     249     79  
                         

The following tables provide details of our claims and reserves for the periods indicated.

   
   
    For the three months ended     For the six months ended  
   
      June 30, 2017       June 30, 2016     June 30, 2017       June 30, 2016  
    ($ Values In Thousands)  
Number of claims paid     8       3       12       3  
Total amount paid for claims   $ 429     $ 132     $ 571     $ 132  
Average amount paid per claim   $ 54     $ 44     $ 48     $ 44  
Severity     86 %     71 %     87 %     71 %
   
   
Average reserve per default:                     As of June 30, 2017       As of June 30, 2016  
                      (In Thousands)  
Case                   $ 19     $ 17  
IBNR                     1       1  
Total                   $ 20     $ 18  
                                 

The following table provides a comparison of the PMIERs financial requirements as reported by National MI as of the dates indicated.

                   
    As of
    June 30, 2017   March 31, 2017   June 30, 2016
    (In thousands)
Available assets   $ 485,019   $ 466,982   $ 432,074
Risk–based required assets     298,091     398,859     377,468
                   

Green Brick Partners, Inc. Announces Dates for 10-Q Filing and Earnings Call

PLANO, TX—(Marketwired – August 01, 2017) – Green Brick Partners, Inc. (NASDAQ: GRBK) (the “Company” or “Green Brick”) announced that the Company will release its financial results for the second quarter ended June 30, 2017, after the market closes on Monday, August 7, 2017. Jim Brickman, Green Brick's CEO, will host an earnings conference call to discuss its second quarter results at 12:00 p.m. Eastern Time on Tuesday, August 8, 2017. The call can be accessed via the following dial–in:

     
  Live participant toll free dial–in (domestic):  800–374–0137
   
  Live participant dial–in (international):  904–685–8013
   
  Participants must use this conference ID code to join the call:  58946666
     

A replay of the call will be available from approximately 3:00 p.m. Eastern Time on August 8, 2017 through 11:59 p.m. Eastern Time on August 15, 2017. The replay can be accessed via the following dial–in:

     
  Replay participant toll free dial–in (domestic):  855–859–2056
   
  Replay participant dial–in (international):  404–537–3406
   
  Participants must use this conference ID code to join the call:  58946666
     

Green Brick is a uniquely structured company that combines residential land development and homebuilding. The Company acquires and develops land, provides land and construction financing to its controlled builders, and participates in the profits of its controlled builders. The Company owns a controlling interest in four homebuilding companies in Dallas, Texas (CB JENI Homes DFW LLC, Normandy Homes (a division of CB JENI), Southgate Homes DFW LLC, and Centre Living Homes, LLC), as well as a leading homebuilder in Atlanta, Georgia (The Providence Group of Georgia, L.L.C.). The Company is engaged in all aspects of the homebuilding process, including land acquisition and the development, entitlements, design, construction, marketing and sales and the creation of brand images at its residential neighborhoods and master planned communities. For more information about the Company and its new home developments please visit the Company's website at www.greenbrickpartners.com.