Wednesday, April 7, 2010

Risin' Aurizon Mines

We continue our series on promising junior precious metals companies with Aurizon Mines Ltd.

Aurizon Mines Ltd. (TSX:ARZ; NYSE Amex:AZK) is a Canadian based gold producer, exploration and development company.  The Company is focused on becoming an intermediate gold producer by exploring
and developing large land positions on favorable geological trends, close to infrastructure, in politically stable, pro-mining jurisdictions.

Aurizon's key property is Casa Berardi, which began commercial gold production in the second quarter of 2007 and is expected to produce approximately 150,000 - 155,000 gold ounces in 2009.

In addition to Casa Berardi, Aurizon owns the Joanna Gold Project and the Kipawa Exploration Property.  Aurizon's combined property holdings cover in excess of 300 square miles of prospective geology in the Abitibi area of Quebec.  The Abitibi region, as discussed in yesterday's piece on Explor Resources, is one of the most historically prolific mining areas in Canada.

Aurizon reported magnificent results for the fourth quarter of 2009 and the full year.

For the fourth quarter, the Company had cash flow from operations of $12.0 million and net earnings of $9.9 million, or 6 cents per share.  Gold production was 36,459 ounces at a cash cost of $459 per ounce.

For the full year, Aurizon achieved record revenues of $175.6 million, 22% higher than 2008.  Net earnings were also a record of $36.7 million, or $0.23 per share.  Cash flow from operating activities were $71.8 million, 19% higher than 2008.  Total cash costs per ounce were $401 per ounce.  The company was able to repay debt of $29.2 million out of operating cash flow.

As at December 31, 2009, cash and cash equivalents increased to $113.1 million, compared to $55.6 million in 2008.  Included in the 2008 cash balances are restricted cash amounts in respect of the Casa Berardi debt facility totalling $21.2 million.

Aurizon has 150 million shares outstanding and has recently traded at $5.00 per share. The company trades at about 10 times trailing 12-month cash flow.  Given the Company's low cost structure and the prospect for higher Gold prices, AZK has plenty of upside for investors.

Here's to hoping for achieving great profits on the (H)"orizon"!

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