Ascendant Resources

Ascendant Resources Inc. (T.ASND) is a mining company focused on its producing zinc-lead-silver El Mochito mine. Since acquiring the mine, Ascendant has increased throughput by more than 60%, has had success with its restarted exploration activities and has achieved positive EBITDA continuously since July. With the price of zinc hitting 10-year highs, Ascendant is one of the few small cap pure play zinc producers benefitting from these improving zinc market fundamentals.

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Ascendant Resources Secures $5 Million Revolving Credit Facility

Ascendant Resources Inc. (TSX: ASND) (OTCQX: ASDRF; FRA: 2D9) (“Ascendant” or the “Company”) is pleased to announce its wholly owned subsidiary, American Pacific Honduras S.A. de C.V (“AMPAC”) closed a US$5 million short-term revolving credit facility (the “credit facility”) with Banco Financiera Comercial Hondurena S.A. (“Ficohsa”) based out of Tegucigalpa, Honduras.

The credit facility has a 12-month term from the closing date, bears interest at a rate of 8-13%, depending on currency drawn down, and is renewable on an annual basis. The facility will be used for working capital and other general corporate purposes. The credit facility is secured by a pledge of the Company’s real estate assets at the port of Puerto Cortés, Honduras as well as a corporate guarantee.

“This facility strongly supports Ascendant’s liquidity and greatly eases cash management and inventory control for the Company.” Stated Chris Buncic, President & CEO of Ascendant. He continued, “We look forward to a strong and fruitful relationship with our friends at Ficohsa as we continue to grow our operations.”

About Ascendant Resources Inc.

Ascendant is a Toronto-based mining company focused on its 100%-owned El Mochito Zinc-Lead-Silver Mine in north-western Honduras, which has been in production since 1948. After acquiring the mine in December 2016, Ascendant implemented a rigorous optimization program aimed at restoring the historic potential of the El Mochito mine. In 2017, the Company successfully completed the operational turnaround with sustained production reaching record levels and profitability restored. The Company remains focused on cost reduction and further operational improvements to drive robust free cash flow in 2018 and beyond. Ascendant is also focused on expanding and upgrading known resources through extensive exploration work for near-term growth. With a significant land package of 11,000 hectares and an abundance of historical data there are several regional targets providing longer term exploration upside which could lead to further Mineral Resource growth. The Company is also engaged in the evaluation of producing and development stage Mineral Resource opportunities, on an ongoing basis. The Company’s common shares are principally listed on the Toronto Stock Exchange under the symbol “ASND”. For more information on Ascendant Resources, please visit our website at www.ascendantresources.com.

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

For further information please contact:
Katherine Pryde
Director, Communications & Investor Relations
Tel: 888-723-7413
info@ascendantresources.com

Forward Looking Information

This news release contains “forward-looking statements” and “forward-looking information” (collectively, “forward-looking information”) within the meaning of applicable Canadian securities legislation. All information contained in this news release, other than statements of current and historical fact, is forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as “plans”, “expects”, “budget”, “guidance”, “scheduled”, “estimates”, “forecasts”, “strategy”, “target”, “intends”, “objective”, “goal”, “understands”, “anticipates” and “believes” (and variations of these or similar words) and statements that certain actions, events or results “may”, “could”, “would”, “should”, “might” “occur” or “be achieved” or “will be taken” (and variations of these or similar expressions). Forward-looking information is also identifiable in statements of currently occurring matters which may continue in the future, such as “providing the Company with”, “is currently”, “allows/allowing for”, “will advance” or “continues to” or other statements that may be stated in the present tense with future implications. All of the forward-looking information in this news release is qualified by this cautionary note.

Forward-looking information in this news release includes, but is not limited to, statements regarding the repayment of the credit facility and the ability of the credit facility to help with the Company’s working capital expenditures . The material factors or assumptions that Ascendant identified and were applied by Ascendant in drawing conclusions or making forecasts or projections set out in the forward-looking information include, but are not limited to, the ability of the Company repay the credit facility and the ability of the credit facility to help with the Company’s working capital expenditures.

The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, risks generally associated with the mining industry, such as economic factors (including future commodity prices, currency fluctuations, energy prices and general cost escalation), uncertainties related to the development and operation of Ascendant’s projects, dependence on key personnel and employee and union relations, risks related to political or social unrest or change, rights and title claims, operational risks and hazards, including unanticipated environmental, industrial and geological events and developments and the inability to insure against all risks, failure of plant, equipment, processes, transportation and other infrastructure to operate as anticipated, compliance with government and environmental regulations, including permitting requirements and anti-bribery legislation, volatile financial markets that may affect Ascendant’s ability to obtain additional financing on acceptable terms, the failure to obtain required approvals or clearances from government authorities on a timely basis, uncertainties related to the geology, continuity, grade and estimates of Mineral Reserves and Mineral Resources, and the potential for variations in grade and recovery rates, uncertain costs of reclamation activities, tax refunds, hedging transactions, the inability of the Company to meet its guidance, the inability of the Company to repay the line of credit, the inability of the line of credit to help with the Company’s working capital expenditures, as well as the risks discussed in Ascendant’s most recent Annual Information Form on file with the Canadian provincial securities regulatory authorities and available at www.sedar.com.

Should one or more risk, uncertainty, contingency, or other factor materialize, or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, the reader should not place undue reliance on forward-looking information. Ascendant does not assume any obligation to update or revise any forward-looking information after the date of this news release or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law.

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Ascendant Resources Announces Record Metal Production and EPS of $0.06 in Second Quarter 2018

Q2 2018 Highlights Include:

  • Net income of $4.58 million and earnings per share of $0.06
  • Adjusted EBITDA of $7.38 million; fourth consecutive quarter of positive adjusted EBITDA
  • Record contained metal production of 22.9 million ZnEq lbs; the sixth consecutive quarter of metal production growth
  • Direct operating costs of $76.61/t, a decrease of 3% year to date and 17% over Q2/17
  • ZnEq grade of 6.3%, an increase of 15% over Q2/17 and 3% over Q1/18
  • Updated Mineral Resource and Mineral Reserve Estimate increased mine life to seven years
  • Revised 2018 Operational Guidance to reflect the new mine plan
  • Option agreement to acquire up to 80% in the high-grade polymetallic Lagoa Salgada VMS project in Portugal

TORONTO, Aug. 08, 2018 (GLOBE NEWSWIRE) — Ascendant Resources Inc. (TSX: ASND) (OTCQX: ASDRF; FRA: 2D9) (“Ascendant” or the “Company”) reports second quarter 2018 results with net income of $4.58 million or earnings per share of $0.06 during the period from its El Mochito mine. Contained metal production for the quarter was 22.9 million zinc equivalent1 lbs at an average head grade of 6.3%, representing the Company’s strongest quarter of production since assuming operation of the mine. These results also exceeded the previous record set in Q1/2018 and demonstrate the Company’s continued delivery of improved efficiency in operations.

President and CEO Chris Buncic stated: “Over the course of the last eighteen months operating the El Mochito mine, the Company has delivered on continuous improvements with respect to mill throughput and grade. This is its sixth consecutive quarter of metal production increases at El Mochito. The Company’s commitment to investment in the development of its people and equipment has resulted in greater efficiencies and better mining dilution control. Despite a few challenges during the second quarter, the Company’s ability to respond adeptly, enabled it to increase both tonnes milled and contained metal production during the period.

He continued,Metal prices for zinc, lead and silver have declined over the course of the last few months, putting pressure on all producers to achieve targeted financial and operational objectives. While short-term prices remain under pressure due to weak market sentiment surrounding lingering global trade tensions and the potential impact on global demand, we continue to see the underlying fundamentals as highly supportive for the zinc market in the medium-term. Fundamentals continue to indicate significant structural supply deficits for zinc in the near-term due to global inventory depletion, supporting the Company’s positive view on prices. Weaker prices in the near- term are expected to defer new project development needed to bridge the demand gap. Nevertheless, the Company remains focused on long-term operational improvements aimed at lowering costs and improving profitability, to make El Mochito a robust and profitable mine in any metals price environment.”

____________
1 This figure was calculated on a spot metal price basis.

Summary of key operational and financial performance for the second quarter 2018 is provided in the tables below:

   Three Months EndedSix Months Ended
Key Operating Information June 30,June 30,
   2018201720182017
Total Tonnes Mined tonnes  189,690  151,028  376,944  282,353
 
Total Tonnes Milled tonnes  192,428  150,785  379,382  281,902
Average Head Grades 
Average Zn grade%4.3%3.4%4.2%3.4%
Average Pb grade%1.5%1.3%1.6%1.3%
Average Silver gradeg/t  48  49  47  50
ZnEq Head grade(1)%6.3%5.5%6.2%5.5%
Average Recoveries 
Zinc%89.7%88.9%89.9%89.3%
Lead%79.1%72.3%77.2%74.4%
Silver%79.4%79.3%79.0%79.1%
Contained Metal Production 
Zinc000’s lbs  16,343  9,933  31,644  18,821
Lead000’s lbs  5,109  3,216  10,235  6,174
Silverozs  229,043  188,245  444,642  361,286
ZnEq(1)000’s lbs  22,926  15,377  44,338  29,049
Payable Production 
Zinc000’s lbs  13,892  8,443  26,898  15,998
Lead000’s lbs  4,854  3,056  9,723  5,865
Silverozs  160,330  131,771  311,249  252,900
ZnEq(1)000’s lbs  19,487  13,071  37,687  24,692
Payable Metal Sold 
Zinc000’s lbs  14,054  9,890  29,340  14,581
Lead000’s lbs  5,331  –  11,654  1,982
Silverozs  181,372  24,062  350,537  126,768
ZnEq(1)000’s lbs  20,253  10,246  41,796  17,993
Average Realized Metal Price
Zinc$/lb$1.35$1.25$1.44$1.25
Lead$/lb$1.09$0.98$1.08$1.01
Silver$/oz$16.39$16.41$16.40$17.81
Cash operating cost per ZnEq payable lb sold(2)$/ZnEq lb$0.76$1.30$0.79$1.25
AISC per ZnEq payable lb sold(2)$/ZnEq lb$1.39$2.08$1.36$1.90
Direct operating cost per tonne milled (excl. CAPEX)(2)$/tonne$76.61$89.97$74.50$94.13
(1)Assumes average spot metal prices for the period.
(2)This is a non-IFRS performance measure, see Non-IFRS Performance Measures section of the MD&A.
Three Months EndedSix Months Ended
Financial June 30,June 30,
2018201720182017
Total revenue$000’s  22,657  9,942  50,695  17,866
Mine operating expenses$000’s  17,545  14,864  37,169  24,571
Income (loss) from mining operations$000’s  5,112  (4,922)  13,526  (6,705)
Net income (loss)$000’s  4,582  (8,553)  9,876  (11,449)
Adjusted EBITDA(2)$000’s  7,379  (5,514)  15,318  (7,205)
Operating cash flow before movements in working capital(2)$000’s  5,853  (5,959)  12,622  (8,510)
Operating cash flow$000’s  6,494  (3,076)  17,913  (11,412)
Cash and cash equivalents$000’s  11,322  9,702  11,322  9,702
Working capital$000’s  8,961  16,874  8,961  16,874
Capital Expenditures$000’s  8,002  4,212  14,118  5,818
(1)Assumes average spot metal prices for the period.
(2)This is a non-IFRS performance measure, see Non-IFRS Performance Measures section of the MD&A.
 

Second Quarter 2018 Operational Performance

Contained metal production for the second quarter 2018 (“Q2/18”) was 16.3 million lbs of zinc (“Zn”), 5.1 million lbs of lead (“Pb”) and 229,043 ounces of silver (“Ag”). Zinc equivalent (“ZnEq”) metal production was 22.9 million lbs using average realized metal prices for the quarter. This represents a 49% increase over second quarter 2017 (“Q2/17”) production of 15.4 million ZnEq lbs, a 7% increase over the first quarter 2018 (“Q1/18”) of 21.4 million ZnEq lbs, and the sixth consecutive quarter of metal production growth.

Milled production for the second quarter 2018 was 192,428 tonnes, representing a 28% increase against Q2/17 and a 3% increase against Q1/18. June’s performance was mildly impacted by four days of lost production caused by issues experienced with the shaft loading pocket, a failure of a main bearing on the primary screen in the plant, which both have been remedied, and inclement weather which resulted in short interruptions to power to the mine. Throughput rates and grades continue to improve quarter over quarter as the Company sees the benefits of the new truck fleet and remains focused on mining dilution control.

During Q2/18, recoveries averaged 89.7% for zinc, 79.1% for lead and 79.4% for silver which have been relatively stable over the six quarters the Company has owned and operated the mine. Average head grades were 4.3% zinc, 1.5% lead and 48 grams per tonne silver. Zinc equivalent head grade was 6.3% using average metal pricing for the period, a 15% increase over Q2/17 and a 3% increase over Q1/18. Contributions from the high-grade Imperial, Barbasco, Port Royal and San Juan “chimney” ore-bodies had a positive impact on grade for the quarter combined with better mining dilution controls in the mantos areas.

Second Quarter 2018 Financial Performance

The Company reports financial results for the three months ended June 30, 2018 with 20.3 million zinc equivalent lbs sold in Q2/18 with income from mining operations of $5.11 million. Average realized metal prices, on a provisional basis, for the quarter were $1.35 per pound of zinc, $1.09 per pound of lead and $16.39 per ounce of silver.

Second Quarter 2018 Financial Highlights:

  • Net concentrate sales revenue of $22.66 million
  • Net income of $4.58 million and earnings per share of $0.06
  • Adjusted EBITDA2 of $7.38 million
  • Operating cash flow before changes in working capital of $5.85 million
  • Contained metal production of 22.9 million ZnEq lbs, and quarterly milled tonnes of 192,428
  • Direct operating cost of $76.61/t and Cash Operating Costs of $0.76/ZnEq lb
  • Quarterly payable zinc equivalent production increased 7% to 19.5 million lbs from Q1/18 with payable zinc, lead and silver production of 13.9 million lbs, 4.9 million lbs and 160,330 ozs produced respectively

The Company reported net income of $4.58 million, or $0.06 earnings per share, in the second quarter 2018. Adjusted EBITDA totalled $7.38 million, representing four consecutive quarters of positive adjusted EBITDA. This is a significant increase over second quarter 2017 adjusted EBITDA of negative $5.51 million and a slight decrease over first quarter 2018 of $7.95 million due to lower net selling prices realized in the quarter. The Company’s cash balance was US$11.3 million at June 30, 2018.

Direct operating costs per tonne milled for Q2/18 were $76.61, a 15% decrease versus $89.97 in Q2/17, a 6% increase against Q1/18 where the direct operating cost was $72.33 per tonne milled, but with an overall decrease of 3% year to date. These reductions are a result of cost optimization, operational efficiencies, and increased production achieved, however the cost increase against the first quarter was due to a 6% increase in the cost of power and slightly higher conventional mining costs which target smaller, higher grade ore bodies. Cost reduction on a per-pound payable metal produced basis is an ongoing focus for the Company. There are additional initiatives in place, aimed at further improving the Company’s cost structure.

Cash operating cost per zinc equivalent payable pound sold was $0.76 and All-In Sustaining Cost (“AISC”) was $1.39 per zinc equivalent payable pound sold for the first quarter. Capital expenditures are expected to decline in the second half of the year as payments for the new fleet are almost complete as well as reduced spending on the tailings dam raise that was completed in the first half of 2018. Last quarter the Company announced it adopted the AISC reporting metric as the Company believes it more fully defines the total costs associated with producing zinc and provides greater transparency for stakeholders when assessing operating performance and ability to generate free cash flow from operations.

Updated Mineral Resources and Mineral Reserves Declared in Q2/18

The Company filed an updated NI 43-101 Mineral Resource and Mineral Reserve Estimate and Technical Report for the El Mochito Mine in the second quarter (see press releases on May 28, 2018), highlighting the following:

Proven & Probable Mineral Reserves increase life of mine beyond seven years (at a rate of 820kt/yr):
Contained zinc increased 193% from 204 M lbs to 597 M lbs
Contained lead increased 109% from 100 M lbs to 209 M lbs
Contained silver increased 106% from 3.5 M oz to 7.2 M oz

Measured & Indicated Mineral Resources increase
50% to 869 M lbs contained zinc from 578 M lbs, and
28% to 1,216 M lbs contained zinc equivalent metal, up from 953 M lbs

Inferred Mineral Resources also increase by 14% to 739M lbs contained zinc equivalent metal, up from 648 M lbs.

____________
2 Adjusted EBITDA is a Non-IFRS measure and is calculated by considering the Company’s earnings before interest payments, tax, depreciation and amortization, share-based payments, adjusted for net foreign exchange expenses.

A summary of the Mineral Reserve Estimate is set out in Table 1 and the Mineral Resource Estimate can be found in Table 2 below:

Table 1: El Mochito Mineral Reserve Statement – Effective 01 January 2018
CategoryTonnesGradeContained Metal
 ZnPb Ag ZnEq.ZnPbAgZnEq.
(kt)(%)(%)(g/t)(%)MlbsMlbsMozMlbs
Proven Reserves785   4.7   2.1 54  7.2   81   35 1.4  124
Probable Reserves4,946   4.7   1.6 36  6.6   516   174 5.8  717
Proven & Probable Reserves5,731   4.7   1.7 39  6.7   597   209 7.2  841
Notes:         
(1)Metal price assumptions used were US$1.21/lb Zn, US$1.06/lb Pb and US$18/oz Ag
(2)Zinc equivalent metal grade (ZnEq %) was calculated as follows Zn% +(Pb % x 0.8175) +(Ag g/t x 0.0149) = ZnEq% and is based on 88.9% Zn, 74.3% Pb and 77.7% Ag metallurgical recoveries.
(3)A cut-off value of 4.76% ZnEq was used to estimate the Mineral Reserve which considered metal price assumptions, metal recoveries, refining charges, concentrate mass pulls, operating costs, royalties, concentrate treatment charges, payables, penalties and transportation/selling costs.
(4)Mineral Resources are stated inclusive of Mineral Reserves, tonnages, grades and contained metal values have been rounded, totals may vary due to rounding.
Table 2: El Mochito Mineral Resource Statement – Effective 01 January 2018
CategoryTonnesGradeContained Metal
 ZnPb Ag ZnEq.ZnPbAgZnEq.
(kt)(%)(%)(g/t)(%)MlbsMlbsMozMlbs
Measured Resources1,100   5.5   2.0 658.2  134   48 2.3  198
Indicated Resources6,452   5.2   1.7 417.2  735   241 8.4  1,019
Measured & Indicated Resources7,553   5.2   1.7 447.3  869   289 10.7  1,216
         
Inferred Resources4,972   5.1   1.4 336.7  556   156 5.4  739
Notes:
(1)Mineral Resources are stated inclusive of Mineral Reserves, Tonnage, grade and contained metal values have been rounded, totals may vary due to rounding.
(2)Price assumptions used were US$1.21/lb Zn, US$1.06/lb Pb and US$18/troy oz Ag. Zinc equivalent metal grade (ZnEq. %) was calculated as follows:  Zn% +(Pb % x 0.82) +(Ag g/t x 0.0149) = ZnEq%  and is based on 88.9% Zn recovery, 74.3% Pb recovery and 77.7% Ag recovery.
(3)A cut-off of 3.1% ZnEq. was used to estimate Mineral Resources and is based on fourth quarter 2017 marginal direct operating costs.
(4)Results of an interpolated bulk density deposit model have been applied, and contributing 5ft downhole assay composites were capped at 38% Zn, 36% Pb and 2000g/t Ag.
(5)Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.
(6)The Inferred Mineral Resource in this estimate has a lower level of confidence than that applied to an Indicated Mineral Resource and must not be converted to a Mineral Reserve. It is reasonably expected that the majority of the Inferred Mineral Resource could be upgraded to an Indicated Mineral Resource with continued exploration.

The Technical Report was prepared in accordance with National Instrument 43-101 (“NI 43-101”) and the CIM Standards by Mercator Geological Services Limited, with contributions made by P&E Mining Consultants Inc. with reference to the Mineral Reserve Estimate, mining and metallurgical engineering sections and was filed on SEDAR.

Mineral Reserve Estimate

The P&E Mining Consultants Inc. Mineral Reserve Estimate (Table 1) review strategy was based on a review and check for reasonableness of the percent zinc equivalent (“ZnEq%”) cut-off value. Subsequently, the internal dilution, external dilution, and mine extraction (mining recovery) was scrutinized for each of the four mining methods employed to ensure they fell within acceptable limits for Mineral Reserve Estimate reporting. In addition, the remaining Mineral Resource Estimate not converted to a Mineral Reserve Estimate was reviewed to ensure it balanced with the mine extraction data. The Mineral Reserve Estimate reviews were summarized into overall dilution and mine extraction percentile for a reasonable value comparison analysis. The average values are as follows: Internal Dilution = 1.3%, External Dilution = 14.3% and Mine Extraction = 90.9%.

Mineral Resource Estimate

The Mineral Resource Estimate, as set out in Table 2, was prepared by Mercator Geological Services Limited. The effective date of this Mineral Resource Estimate is January 1, 2018, and it is based on 26 contiguous areas of “manto” and/or “chimney” style skarn mineralization defined by 2,176 diamond drill holes up to December 31st, 2017. 3D solid models of skarn mineralization reflecting a minimum grade of 3% ZnEq. were depleted for previously mined areas to constrain Mineral Resource volumes. GEOVIA Surpac® 6.8.1 software was used to assign block grades for zinc (%), lead (%), silver (g/t) and density (g/cm3) for Measured, Indicated and Inferred Mineral Resources using inverse distance squared (ID2) interpolation methodology and capped 5 foot down hole assay composites. Up to four interpolation passes were applied using progressively increasing ellipsoid ranges to cover the range of 3D solid model sizes present. Block size is 10 feet (x) by 10 feet (y) by 10 feet (z) with two levels of sub-blocking allowed to a minimum block size of 2.5 feet (x) by 2.5 feet (y) by 2.5 feet (z). Mineral Resource categorization was applied using discrete solid models developed from contributing drill hole and assay composite parameters.

Exploration Activities

During the second quarter, the Company continued the advancement of its 40,000 metre 2018 drill program underground at El Mochito. This program is focused equally on definition drilling for the purpose of resource conversion to further enhance the new resource base supporting a long operating life and exploration drilling to define additional material near mine and regional exploration targets.

In June 2018, the Company announced results from 40 diamond drill holes or 12,015 metres. The drilling results were split between step-out (66%) and in-fill (34%) drill holes, targeting four ore bodies, namely Porvenir, Santa Elena, Port Royal Manto and Esperanza. (see press release issued on June 14, 2018) Results continue to demonstrate high-grade mineralization above current mining grades and support managements goal of identifying long-term Mineral Resource growth. As of the end of July 20,495 meters of the program had been completed with the next set of results expected during Q3.

Additionally, the Company is reviewing and prioritizing near-mine targets within the existing concessions including the anomalies named Manzanal, Soledad, Caliche and Nispero. Management has also identified a number of high-grade targets, which have not been properly explored at the El Mochito mine itself. Follow-up work on known “chimney” type ore bodies with historic grades well above current Mineral Reserve and Mineral Resource grade is underway in the historical upper levels of the mine, many of which is still in relatively good condition. There also remains the possibility of including various unmined blocks, pillars and remnants that could be categorized into Mineral Resources if they are confirmed accessible and accordingly sampled.

Lagoa Salgada Exploration Project

In June 2018, Ascendant entered into an agreement with TH Crestgate GmbH (“Crestgate”) to acquire an initial 25% interest in its Portuguese subsidiary Redcorp – Emprendimentos Mineiros, Lda (“Redcorp”), which holds an 85% interest in the polymetallic Lagoa Salgada volcanogenic massive sulphide (“VMS”) Project (“Lagoa” or the “Project”) located in Portugal, as well as an option to earn up to an 80% interest in Redcorp upon completion of certain milestones. (see press release issued on August 1, 2018 for transaction details).

Lagoa Salgada currently has a resource of 5.84 million tonnes of Indicated Mineral Resources at 8.88% ZnEq and 2.01 million tonnes of Inferred Mineral Resources at 7.82% ZnEq in the LS-1 Deposit and 2.22 million tonnes at 4.8% ZnEq in the LS-1 Central Deposit, prepared in accordance with NI 43-101. The Project covers 10,700 hectares with 17 gravimetric targets identified, with only the LS-1 and LS-1 Central zone having been significantly tested.

The Lagoa Salgada Project is located within the north-western section of the prolific Iberian Pyrite Belt in Portugal, approximately 80 km southeast of Lisbon and is accessible by national highways and roads. The Project is comprised of a single exploration permit covering an area of approximately 10,700 hectares. The Project represents an early-stage, potentially high-grade, polymetallic zinc-lead-copper exploration opportunity in a low risk, established and prolific jurisdiction.

The Iberian Pyrite Belt (IBP) is host to some of the world’s largest VMS deposits and mines such as Neves-Corvo (Lundin Mining Corporation), Aguas Tenidas (Trafigura Mining Group) and Aljustrel (private), and represents the largest concentration of massive sulphide deposits in the world, forming an arch through Portugal and Spain about 240 km long and 35 km wide and has produced more than 300 million tonnes of massive sulfide ore over the past hundred years.

Ascendant views Lagoa as immediately accretive to the Company’s ZnEq metal expose and offers the potential to be potentially high-grade, polymetallic zinc-lead-copper exploration opportunity in a low risk, established and prolific jurisdiction. Ascendant is finalizing an exploration program aimed at significantly accelerating exploration efforts on the project with the expectation of significantly expanding the known Mineral Resources at Lagoa.

Outlook & Growth

The rapid decline in prices for zinc, lead and silver during the past few months has placed immense pressure on all producers, including Ascendant, to achieve targeted objectives for the current year. As such, the Company has revised its expected operational and financial objectives for the balance of the year. Please see Revised 2018 Operational Guidance section below.

In conjunction with the completion of the NI 43-101 Technical Report for El Mochito, outlining a mine life of more than seven years as described above, Ascendant has engaged third party technical and engineering firms to assist with the further review of the El Mochito mine.

The focus of the analysis has been on increasing production and sustainably lowering operating and capital costs primarily through strategic improvements to the underground infrastructure, plant upgrades and water & tailings management systems. Management is confident that the optimization plans have the potential to deliver strong EBITDA and robust free cash flow at consensus long-term metal prices.

Revised 2018 Operational Guidance

Management is very pleased to have recorded six consecutive quarters of production growth at El Mochito while continuing to reduce costs dramatically over the same period. Following completion of the NI 43-101 Mineral Reserves and Mineral Resources Report and the associated mine plan in May 2018, the Company has been focused on strategically increasing development rates in the mine to accelerate access into higher-grade portions of the mine. This is expected to increase the average feed grade to the mill for the coming years.

The accelerated development program has increased our operational capital expenditure requirements for the 2018 fiscal year. Direct operating costs remain unchanged at this time as the Company has been successful at decreasing unit costs year to date with further improvements expected through the remainder of the year.

Commodity price weakness has also impacted the Company’s financial objectives which have been revised as a consequence as well.

Please see our revised Guidance for 2018 in the chart below:

GuidancePrevious1Revised2
Contained Metals in Concentrate 
Zinc equivalent metal93 – 109 million lbs85 – 95 million lbs
Zinc65 – 73 million lbs60 – 66 million lbs
Lead24 – 28 million lbs18 – 22 million lbs
Silver900,000 – 1,200,000 ozs800,000 – 950,000 ozs
Direct Operating Costs $70 – $80 / tonne$70 – $80 / tonne
Capital Expenditure$16 – $18 million$24 – $27 million
Financial Metrics 
Adjusted EBITDA$32 – $40 million$23 – $28 million
Free Cash Flow$14 – $20 million$2 – $5 million

1 Previous figures are based on the following metal price assumptions for full year 2018; $1.50/lb zinc, $1.10/lb lead and $18/oz silver.
2 Revised figures are based on the following metal price assumptions for the second half of 2018 $1.20/lb zinc, $0.95/lb lead and $16/oz silver.

Management is optimistic that the current depressed pricing for zinc is unlikely to be sustained, however we are providing our revised guidance using spot pricing of $1.20/lb Zn, $0.95/lb Pb and $16/oz Ag. A $0.10/lb improvement in zinc pricing would add over $3 million to EBITDA and Free Cash Flow for the balance of the year.

Management expects to exit the year with a strong cash position of approximately $10-12 million following all expenditures on programs at El Mochito and Lagoa Salgada.

Conference Call

A conference call will be held tomorrow, August 9, 2018, at 10:00am EDT to discuss second quarter 2018 operational and financial results.

Conference Call Details:
Date of Call: Thursday, August 9, 2018
Time of Call: 10:00am EDT
Conference ID: 3172066
Dial-In Numbers:
North American Toll-Free: 1-833-696-8362
International: 1-612-979-9908

A recorded playback of the conference call will be available until September 9, 2018 and can be accessed on the Company’s website at www.ascendantresources.com within the Investors section.

The information provided within this release should be read in conjunction with Ascendant’s unaudited condensed consolidated interim financial statements and management’s discussion and analysis for the three months ended June 30, 2018, which are available on Ascendant’s website and on SEDAR. As at January 1, 2017, the Company has changed its presentation currency to the U.S. dollar (US). All financial figures are in US dollars unless otherwise stated.

Technical Disclosure/Qualified Person

All technical information contained herein has been reviewed and approved by Patrick Toth, P.Geo and director of exploration of the Company. Mr. Toth is a “Qualified Person” within the meaning of NI 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”).

About Ascendant Resources Inc.

Ascendant is a Toronto-based mining company focused on its 100%-owned El Mochito Zinc-Lead-Silver Mine in north-western Honduras, which has been in production since 1948. After acquiring the mine in December 2016, Ascendant implemented a rigorous optimization program aimed at restoring the historic potential of the El Mochito mine. In 2017, the Company successfully completed the operational turnaround with sustained production reaching record levels and profitability restored. The Company remains focused on cost reduction and further operational improvements to drive robust free cash flow in 2018 and beyond. Ascendant is also focused on expanding and upgrading known resources through extensive exploration work for near-term growth. With a significant land package of 11,000 hectares and an abundance of historical data there are several regional targets providing longer term exploration upside which could lead to further Mineral Resource growth. The Company is also engaged in the evaluation of producing and development stage Mineral Resource opportunities, on an ongoing basis. The Company’s common shares are principally listed on the Toronto Stock Exchange under the symbol “ASND”. For more information on Ascendant Resources, please visit our website at www.ascendantresources.com.

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

For further information please contact:
Katherine Pryde
Director, Communications & Investor Relations
Tel: 888-723-7413
info@ascendantresources.com

Cautionary Notes to US Investors

The information concerning the Company’s mineral properties has been prepared in accordance with National Instrument 43-101 (“NI-43-101”) adopted by the Canadian Securities Administrators.  In accordance with NI-43-101, the terms “Mineral Reserves”, “Proven Mineral Reserve”, “Probable Mineral Reserve”, “Mineral Resource”, “Measured Mineral Resource”, “Indicated Mineral Resource” and “Inferred Mineral Resource” are defined in the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”) Definition Standards for Mineral Resources and Mineral Reserves adopted by the CIM Council on May 10, 2014.  While the terms “Mineral Resource”, “Measured Mineral Resource”, “Indicated Mineral Resource” and “Inferred Mineral Resource” are recognized and required by NI 43-101, the U.S. Securities Exchange Commission (“SEC”) does not recognize them.  The reader is cautioned that, except for that portion of Mineral Resources classified as Mineral Reserves, Mineral Resources do not have demonstrated economic value.  Inferred Mineral Resources have a lower level of confidence that that applied to an Indicated Mineral Resource and must not be converted to a Mineral Reserve. It is reasonably expected that the majority of the Inferred Mineral Resource could be upgraded to an Indicated Mineral Resource with continued exploration. Therefore, the reader is cautioned not to assume that all or any part of an Inferred Mineral Resource exists, that it can be economically or legally mined, or that it will ever be upgraded to a higher classification.  Likewise, you are cautioned not to assume that all or any part of a Measured or Indicated Mineral Resource will ever be upgraded to Mineral Reserves.

Readers should be aware that the Company’s financial statements (and information derived therefrom) have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board and are subject to Canadian auditing and auditor independence standards. IFRS differs in some respects from United States generally accepted accounting principles and thus the Company’s financial statements (and information derived therefrom) may not be comparable to those of United States companies.

Forward Looking Information
               
This news release contains “forward-looking statements” and “forward-looking information” (collectively, “forward-looking information”) within the meaning of applicable Canadian securities legislation. All information contained in this news release, other than statements of current and historical fact, is forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as “plans”, “expects”, “budget”, “guidance”, “scheduled”, “estimates”, “forecasts”, “strategy”, “target”, “intends”, “objective”, “goal”, “understands”, “anticipates” and “believes” (and variations of these or similar words) and statements that certain actions, events or results “may”, “could”, “would”, “should”, “might” “occur” or “be achieved” or “will be taken” (and variations of these or similar expressions). Forward-looking information is also identifiable in statements of currently occurring matters which may continue in the future, such as “providing the Company with”, “is currently”, “allows/allowing for”, “will advance” or “continues to” or other statements that may be stated in the present tense with future implications. All of the forward-looking information in this news release is qualified by this cautionary note.

Forward-looking information in this news release includes, but is not limited to, statements regarding the consistency of processing recovery levels, improvements of grades in 2018, deployment of new mining equipment, increase in contained metal production, maintenance of production rates, increase of mill feed grades, reduction of costs, monthly shipments of concentrate, the ability to fully fund planned development, exploration and capital expenditures, robust adjusted EBITDA, expectation of expanding the known Mineral Resources at Lagoa Salgada, the Company’s  guidance, and free cash flow generation in 2018 and the undertaking of various long-term optimization programs. Forward-looking information is not, and cannot be, a guarantee of future results or events. Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by Ascendant at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information. The material factors or assumptions that Ascendant identified and were applied by Ascendant in drawing conclusions or making forecasts or projections set out in the forward-looking information include, but are not limited to, the ability of the Company to maintain the consistency of processing recovery levels, to improve grades in 2018, to deploy new mining equipment, increase contained metal production, maintain production rates, increase mill feed grades, reduce costs, make monthly shipments of concentrate, fully fund planned development, exploration and capital expenditures, maintain robust adjusted EBITDA and free cash flow in 2018, the ability to expand known Mineral Resources at Lagoa Salgada, the ability to achieve guidance and undertake various long-term optimization programs and other events that may affect Ascendant’s ability to develop its project; and no significant and continuing adverse changes in general economic conditions or conditions in the financial markets.

The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, risks generally associated with the mining industry, such as economic factors (including future commodity prices, currency fluctuations, energy prices and general cost escalation), uncertainties related to the development and operation of Ascendant’s projects, dependence on key personnel and employee and union relations, risks related to political or social unrest or change, rights and title claims, operational risks and hazards, including unanticipated environmental, industrial and geological events and developments and the inability to insure against all risks, failure of plant, equipment, processes, transportation and other infrastructure to operate as anticipated, compliance with government and environmental regulations, including permitting requirements and anti-bribery legislation, volatile financial markets that may affect Ascendant’s ability to obtain additional financing on acceptable terms, the failure to obtain required approvals or clearances from government authorities on a timely basis, uncertainties related to the geology, continuity, grade and estimates of Mineral Reserves and Mineral Resources, and the potential for variations in grade and recovery rates, uncertain costs of reclamation activities, tax refunds, hedging transactions, the inability of the Company to meet its  guidance, as well as the risks discussed in Ascendant’s most recent Annual Information Form on file with the Canadian provincial securities regulatory authorities and available at www.sedar.com.

Should one or more risk, uncertainty, contingency, or other factor materialize, or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, the reader should not place undue reliance on forward-looking information. Ascendant does not assume any obligation to update or revise any forward-looking information after the date of this news release or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law.

Non-IFRS Performance Measures

The non-IFRS performance measures presented do not have any standardized meaning prescribed by IFRS and are therefore unlikely to be directly comparable to similar measures presented by other issuers.

Non-IFRS reconciliation of adjusted EBITDA

EBITDA is a non-IFRS measure that represents an indication of the Company’s continuing capacity to generate earnings from operations before taking into account management’s financing decisions and costs of consuming capital assets, and management’s estimate of their useful life. EBITDA comprises revenue less operating expenses before interest expense (income), property, plant and equipment amortization and depletion, and income taxes. Adjusted EBITDA has been included in this document. Under IFRS, entities must reflect in compensation expense the cost of share-based payments. In the Company’s circumstances, share-based payments involve a significant accrual of amounts that will not be settled in cash but are settled by the issuance of shares in exchange for cash. EBITDA and Adjusted EBITDA do not have any standardized meaning prescribed by IFRS and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. EBITDA and Adjusted EBITDA exclude the impact of cash costs of financing activities and taxes, and the effects of changes in operating working capital balances, and therefore are not necessarily indicative of operating profit or cash flow from operations as determined under IFRS. Other companies may calculate EBITDA and Adjusted EBITDA differently. As such, the Company has made an entity specific adjustment to EBITDA for these expenses. The Company has also made an entity-specific adjustment to the foreign currency exchange (gain)/loss.

The following table provides a reconciliation of net income (loss) to Adjusted EBITDA:

Three Months EndedSix Months Ended
Adjusted EBITDA June 30,June 30,
2018201720182017
Net income (loss)$000’s  4,582  (8,553)  9,876  (11,449)
Adjusted for: 
Depletion and depreciation$000’s  1,105  699  1,983  1,352
Interest income/expense$000’s  335  87  372  137
Accretion expense on rehabilitation liabilities$000’s  203  237  410  416
Financing charge on termination obligations$000’s  414  377  835  442
Share-based payments$000’s  352  1,117  704  1,118
Foreign currency exchange gain/loss$000’s  34  522  (62)  779
Income taxes$000’s  354  –  1,200  –
Adjusted EBITDA $000’s  7,379   (5,514)  15,318   (7,205)
   

Direct operating cost per tonne milled

The Company uses the non-IFRS measure of direct operating cost per tonne milled to manage and evaluate operating performance. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company’s performance and ability to generate cash flows. Accordingly, it 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. The Company considers cost of sales per tonne milled to be the most comparable IFRS measure to direct operating cost per tonne milled and has included calculations of this metric in the reconciliations within the applicable tables to follow.

Direct operating cost per tonne milled includes mine direct operating production costs such as mining, processing, administration, indirect charges such as surface maintenance and camp expenses, and inventory sales adjustments but does not include, smelting, refining and freight costs, royalties, depreciation, depletion, amortization, reclamation, and capital costs.

Cash operating costs

Cash operating costs is a financial performance measure with no standard meaning under IFRS. Ascendant reports total production cash costs on a sales basis. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, such as sales, certain investors use this information to evaluate the Company’s performance and ability to generate operating earnings and cash flow from its mining operations. Management uses this metric as an important tool to monitor operating cost performance.

Total production cash costs include production costs, such as mining, processing charges divided by ZnEq payable pounds sold to arrive at total cash operating costs per ZnEq payable pound sold. The measure also includes other mine related costs incurred such as variation in inventory. Production costs are exclusive of depreciation. Other companies may calculate this measure differently.

The following table provides a reconciliation of direct operating costs and all-in sustaining costs to cost of sales, as reported in the Company’s consolidated statement of income (loss) for the three months ended June 30, 2018 and 2017:

Three Months EndedSix Months Ended
Direct operating cost per tonne milled June 30,June 30,
2018201720182017
Production expenses (from consolidated income statement)$000’s  17,545  14,864  37,169  24,571
Add: Termination Liability Payments$000’s  250  (369)  478  194
Deduct (Add): Variation in Finished Inventory$000’s  (624)  256  (4,802)  3,989
Deduct: Depreciation in production$000’s  (1,105)  (699)  (1,983)  (1,352)
Total cash costs (including royalties)$000’s  16,066   14,052   30,862   27,402
Deduct: Government taxes and royalties$000’s  (1,324)  (486)  (2,598)  (867)
Direct operating costs $000’s  14,742   13,566   28,264   26,535
Tonnes Milledtonnes  192,428  150,785  379,382  281,902
Direct operating cost per tonne milled $/tonne$76.61$89.97$74.50$94.13
    Three Months EndedSix Months Ended
AISC per ZnEq payable pound sold  June 30,June 30,
    2018201720182017
        
ZnEq payable pounds sold000’s lbs  20,253  10,246  41,796  17,993
Cash Operating Costs Reconciliation
Direct operating costs$000’s  14,742  13,566  28,264  26,535
Add (deduct): Variation in Finished Inventory$000’s  624  (256)  4,802  (3,989)
Cash operating costs  15,366   13,310   33,066   22,546
Cash operating cost per ZnEq payable pound sold$/ZnEq lb$0.76$1.30$0.79$1.25
        
All-in Sustaining Costs (AISC) Reconciliation      
 Total cash operating costs$000’s  15,366  13,310  33,066  22,546
 Add: Government taxes and royalties$000’s  1,324  486  2,598  867
Add: TC & RCs$000’s  3,331  2,324  7,051  3,808
Add: G&A, excluding depreciation and amortization$000’s  1,672  2,452  3,384  3,019
Add: Accretion expense on rehabilitation liabilities$000’s  203  237  410  416
Add: Sustaining capital expenditure$000’s  6,245  2,543  10,430  3,570
Total All-in sustaining costs$000’s  28,141   21,352   56,939   34,226
AISC per ZnEq payable pound sold$/ZnEq lb$1.39$2.08$1.36$1.90

Additional non-IFRS measures

The Company uses other financial measures, the presentation of which is not meant to be a substitute for other subtotals or totals presented in accordance with IFRS, but rather should be evaluated in conjunction with such IFRS measures. The following other financial measures are used:

  • Operating cash flows before movements in working capital – excludes the movement from period-to-period in working capital items including trade and other receivables, prepaid expenses, deposits, inventories, trade and other payables and the effects of foreign exchange rates on these items.

The terms described above do not have a standardized meaning prescribed by IFRS, and therefore the Company’s definitions are unlikely to be comparable to similar measures presented by other companies. The Company’s management believes that their presentation provides useful information to investors because cash flows generated from operations before changes in working capital excludes the movement in working capital items. This, in management’s view, provides useful information of the Company’s cash flows from operations and are considered to be meaningful in evaluating the Company’s past financial performance or its future prospects. The most comparable IFRS measure is cash flows from operating activities.

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Ascendant Resources Acquires Interest and Option in the Highly Prospective Lagoa Salgada VMS Project Located on the Prolific Iberian Pyrite Belt in Portugal

  • Low-cost entry to a significant high-grade VMS polymetallic deposit within reach of mineable scale in the Iberian Pyrite Belt along trend from the transformational Neves Corvo (Lundin) and Aguas Tenidas (Trafigura) mines and Aljustrel (private)
  • NI 43-101 Indicated Resource of 5.8 million tonnes at 8.88% ZnEq and 2.0 million tonnes of Inferred Resources at 7.82% ZnEq at the LS-1 Deposit and 2.2 million tonnes at 4.80% ZnEq at the LS-1 Central Deposit (see below)
  • Immediately accretive to Ascendant’s ZnEq metal exposure with significant and rapid expansion anticipated through the commencement of a low-cost drill program
  • Exemplifies Ascendant’s ability to identify unique high-impact mineral opportunities

TORONTO, Aug. 01, 2018 (GLOBE NEWSWIRE) — Ascendant Resources Inc. (TSX: ASND) (OTCQX: ASDRF; FRA: 2D9) (“Ascendant” or the “Company”) is pleased to announce that it has acquired from TH Crestgate GMBH  (“Crestgate”) a 25% interest in Redcorp – Empreendimentos Mineiros, Lda, (“Redcorp”), which holds an 85% interest in the polymetallic Lagoa Salgada volcanic massive sulphide (“VMS”) Project ( “Lagoa” of the “Project”)  located within the prolific Iberian Pyrite Belt in Portugal and has an additional option to earn up to an 80% interest in Redcorp upon completion of the milestones highlighted below.

Chris Buncic, President & CEO states: “While we are very cognizant of our responsibility to continue the strong progress and operational excellence that we have achieved at our El Mochito mine in the last 18 months, we are extremely pleased to work with Crestgate and Redcorp to develop a project that has the potential of becoming a mine of consequence in the prolific Iberian Pyrite Belt, a belt that has been transformative for Lundin Mining and for Trafigura’s mining operations.”

He continued, “Lagoa Salgada already has a good-sized resource which is very near the scale and grade necessary to be an operating mine. Leading VMS experts and geo statisticians engaged by Ascendant concur that a high impact, low-cost drilling program can be completed by year end that will have the potential to substantially increase current resources. It is our expectation that this program could have a material impact on net asset value for Ascendant shareholders.”

Mr. João Barros, P.Eng., Redcorp’s acting Country Manager, will lead the development of the Lagoa Salgada project under the supervision of Ascendant’s management team with the assistance of C. Tucker Barrie, Ph.D., P.Geo., a geologist with over twenty-five years of international experience in all aspects of VMS deposit exploration, development and research, and Mr. Chris Hale, Ph.D., P.Geo., an exploration geologist with over forty years of international experience.

After an initial review of the Project for the Company, C. Tucker Barrie states, “Lagoa Salgada has a relatively high grade massive sulfide zone to the north as well as significant bulk tonnage potential with an extensive disseminated sulfide zone to the south that is open in many directions. We are looking forward to the opportunity to explore the Project further.”

Lagoa Salgada currently has 5.84 million tonnes of Indicated Resources at 8.88% ZnEq and 2.01 million tonnes of Inferred Resources at 7.82% ZnEq in the LS-1 Deposit and 2.22 million tonnes at 4.8% ZnEq in the LS-1 Central Deposit (see below). Lagoa represents a potentially high-grade, polymetallic zinc-lead-copper exploration opportunity in a low risk, established and prolific jurisdiction. The Project covers 10,700 hectares with 17 gravimetric targets identified, with only the LS-1 and LS-1 Central zone having been significantly tested.

Lagoa Salgada has strong potential for discovery of further VMS deposits along the belt given the abundance of targets and anomalies already identified.

The Iberian Pyrite Belt is host to some of the world’s largest VMS deposits and mines such as Neves-Corvo (Lundin Mining Corporation), Aguas Tenidas (Trafigura Mining Group) and Aljustrel (private). It represents the largest concentration of massive sulphide deposits in the world, forming an arch through Portugal and Spain about 240 km long and 35 km wide. According to the Geological Society of Spain, this region has produced more than 300 million tonnes1 of massive sulphide ore over the past hundred years.

Highlights of the Lagoa Salgada Project

  • The Project is located within the north-western section of the Iberian Pyrite Belt approximately 120 kilometers southeast of Lisbon. The Iberian Pyrite Belt stretches from southern Spain into Portugal and has hosted approximately 60 mines in the last 100 years with exploitation dating back to Roman times. Most notably, it is home to world class copper-zinc VMS deposits including Neves-Corvo (Lundin Mining Corporation), Aguas Tenidas (Trafigura Mining Group) and Aljustrel (private).
  • The Iberian Pyrite Belt is a thrust faulted sedimentary sequence with local sub-aqueous volcanic centers that host VMS deposits. VMS deposits are generally interpreted to be syngenetic in origin; however, mineralization ranges from sulphide precipitates to re-worked sulphide/silicate sediments and local sulphide replacement mineralization located near felsic submarine volcanic centers. Within the Iberian Pyrite Belt, VMS deposits vary in size from a few hundred thousand tonnes to greater than 200 million tonnes and have been dated at Upper Devonian to Lower Carboniferous in age.
  • Over the past two years, Crestgate has completed various early stage geophysical studies and undertaken a drill program to firm up the current resource defined on site. The Project is ideally located in terms of infrastructure, community, and strong political support for development of future mining operations.
  • In July 2018, Crestgate updated a January 2018 Technical Report prepared in accordance with National Instrument 43-101 – Standards for Disclosure for Mineral Projects (“NI 43-101”) defining a preliminary Indicated Mineral Resource Estimate of 5.84 million tonnes grading 8.88% ZnEq and an Inferred Mineral Resources of 2.01 million tonnes grading 7.82% ZnEq, at a 3.5% ZnEq cut-off grade, at the LS-1 deposit with an additional Inferred Mineral Resource of 2.22 million tonnes grading 4.80% ZnEq, at a 3.5% ZnEq cut-off grade, outlined at the LS-1 Central deposit. Only 22 drill holes compose this Mineral Resource Estimate and both deposits remain open in multiple directions giving Ascendant confidence in the ability to rapidly expand the resource with a modest drill program over the next 12-month period. (Refer to Tables 1 and 2 below).

Table 1: Mineral Resources for the LS-1 Deposit at a 3.5% ZnEq cut-off grade – Effective date January 5, 2018

 

Classification

Tonnage
(‘000 t)
Zn
(%)
Pb
(%)
Cu
(%)
Ag
(gpt)
Au
(gpt)
ZnEq
(%)
Indicated5,8402.792.960.3253.540.788.88
Inferred2,0102.442.800.2447.370.657.82
(1)Block matrix is 10mx10mx10m
(2)Grades are estimated by ordinary kriging interpolation
(3)A cut-off grade of 3.5% ZnEq was used to report the Mineral Resource for the LS-1 Deposit
(4)Zinc equivalent metal grade (ZnEq%) was calculated as follows:
ZnEq% = ((Zn Grade * 25.35) + (Pb Grade * 23.15) + (Cu Grade * 67.24) + (Au Grade * 40.19) + (Ag Grade * 0.62)) / 25.35
Metal prices used: US$1.15/lb Zn, US$1.05/lb Pb, $3.05/lb Cu, US$19.40/oz Ag, and 1,250/oz Au
No recoveries were applied
(5)Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability
(6)Shown on a 100% basis. Ascendant holds a 25% interest in Redcorp, the operating subsidiary which holds an 85% interest in the Lagoa Salgada Project

Table 2: Mineral Resources for the LS-1 Central Deposit at a 3.5% ZnEq cut-off grade – Effective date January 5, 2018

 

Classification

Tonnage
(‘000 t)
Zn
(%)
Pb
(%)
Cu
(%)
Ag
(gpt)
Au
(gpt)
ZnEq
(%)
Inferred2,2201.911.110.5117.760.074.80
(1)Block Matrix is 10mx10mx10m
(2)Grades are estimated by ordinary kriging interpolation
(3)A cut-off grade of 3.5% ZnEq was used to report the Mineral Resource for the LS-1 Deposit
(4)Zinc equivalent metal grade (ZnEq%) was calculated as follows:
ZnEq% = ((Zn Grade * 25.35) + (Pb Grade * 23.15) + (Cu Grade * 67.24) + (Au Grade * 40.19) + (Ag Grade * 0.62)) / 25.35
Metal prices used: US$1.15/lb Zn, US$1.05/lb Pb, $3.05/lb Cu, US$19.40/oz Ag, and 1,250/oz Au
No recoveries were applied
(5)Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability
(6)Shown on a 100% basis. Ascendant holds a 25% interest in Redcorp, the operating subsidiary which holds an 85% interest in the Lagoa Salgada Project

Transaction Summary – Key Option Terms

(all amounts USD)

• Ascendant acquired an initial effective 25% interest for an upfront payment of $2.45 million composed of $0.8 million in cash ($400,000 on closing of the transaction and $400,000 on July 15, 2018) and $1.65 million in Ascendant shares, representing an approximate share dilution of 2.6% on a basic basis and 2.1% on a fully diluted basis.
• Ascendant has the right to earn a further effective 25% interest via staged payments and funding obligations as outlined below:
  • Investing a minimum of $9.0 million directly in the operating company, Redcorp within 48 months of the closing date, to fund exploration drilling, metallurgical test work, economic studies and other customary activities for exploration and development, and
  • Making payments totaling $3.5 million to Crestgate according to the following schedule or earlier:
  • 6 months after the closing date: $0.25 million
  • 12 months after the closing date: $0.25 million
  • 18 months after the closing date: $0.5 million
  • 24 months after the closing date: $0.5 million
  • 36 months after the closing date: $ 1.0 million
  • 48 months after the closing date: $ 1.0 million
The Company then has the option to earn an additional 30%, totaling an 80% interest in Redcorp, the operating subsidiary, by completing a Feasibility study within 54 months and making a further payment of $2.5 million to Crestgate.
The Company will fund all development and future construction costs and recoup Crestgate’s share of investment through cash flow until repaid.
Ascendant will retain a Right of First Offer on the remaining equity held by Crestgate.

TSX Approval

Ascendant has received approval of the Toronto Stock Exchange ahead of this announcement for the issuance of the Company’s shares distributed as part of the consideration for this transaction.

Qualified Persons

The technical content of this press release has been reviewed and approved by Paul Daigle, P.Geo., Senior Associate of AGP Mining Consultants Inc. Mr. Daigle is responsible for the Technical Report and Mineral Resource Estimate for the Lagoa Salgada Project, is independent of Ascendant and is a “Qualified Person” as defined by NI 43-101.

About TH Crestgate GMBH

TH Crestgate GmbH (Crestgate) is an investment company based in Basel, Switzerland. Crestgate is currently 49% owned by Mineral and Financial Investments Limited (M&FI), a Cayman Island registered, London Stock Exchange listed, Investment Company. M&FI’s business is to invest in, finance and advise mining companies.

About Redcorp – Empreendimentos Mineiros, Lda.

Redcorp is a private Portuguese exploration and development company, based in Braga, Portugal, and is focused on the development of the Lagoa Salgada Project. Redcorp is a 100% owned subsidiary of TH Crestgate GmbH, a Swiss based investment company.

About Ascendant Resources Inc.

Ascendant is a Toronto-based mining company focused on its 100%-owned producing El Mochito zinc, silver and lead mine in west-central Honduras, which has been in production since 1948. After acquiring the mine in December 2016, Ascendant implemented a rigorous optimization program aimed at restoring the historic potential of the El Mochito mine. In 2017, the Company successfully completed the operational turnaround it set out to achieve with sustained production at record levels and profitability restored. The Company now remains focused on cost reduction and further operational improvements to drive robust free cash flow in 2018 and beyond. Ascendant is also focused on expanding and upgrading known resources through extensive exploration work for near-term growth. With a significant land package of 11,000 hectares and an abundance of historical data there are several regional targets providing longer term exploration upside which could lead to further resource growth. The Company is also engaged in the evaluation of producing and development stage mineral resource opportunities, on an ongoing basis. The Company’s common shares are principally listed on the Toronto Stock Exchange under the symbol “ASND”. For more information on Ascendant Resources, please visit our website at www.ascendantresources.com.

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

For further information please contact:
Katherine Pryde
Director, Communications & Investor Relations
Tel: 888-723-7413
info@ascendantresources.com

Cautionary Notes to US Investors

The information concerning the Company’s mineral properties has been prepared in accordance with National Instrument 43-101 (“NI-43-101”) adopted by the Canadian Securities Administrators. In accordance with NI-43-101, the terms “mineral reserves”, “proven mineral reserve”, “probable mineral reserve”, “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” are defined in the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”) Definition Standards for Mineral Resources and Mineral Reserves adopted by the CIM Council on May 10, 2014. While the terms “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” are recognized and required by NI 43-101, the U.S. Securities Exchange Commission (“SEC”) does not recognize them. The reader is cautioned that, except for that portion of mineral resources classified as mineral reserves, mineral resources do not have demonstrated economic value. Inferred mineral resources have a high degree of uncertainty as to their existence and as to whether they can be economically or legally mined. It cannot be assumed that all or any part of any inferred mineral resource will ever be upgraded to a higher category. Therefore, the reader is cautioned not to assume that all or any part of an inferred mineral resource exists, that it can be economically or legally mined, or that it will ever be upgraded to a higher category. Likewise, you are cautioned not to assume that all or any part of a measured or indicated mineral resource will ever be upgraded into mineral reserves.

Readers should be aware that the Company’s financial statements (and information derived therefrom) have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board and are subject to Canadian auditing and auditor independence standards. IFRS differs in some respects from United States generally accepted accounting principles and thus the Company’s financial statements (and information derived therefrom) may not be comparable to those of United States companies.

Forward Looking Information
               
This news release contains “forward-looking statements” and “forward-looking information” (collectively, “forward-looking information”) within the meaning of applicable Canadian securities legislation. All information contained in this news release, other than statements of current and historical fact, is forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as “plans”, “expects”, “budget”, “guidance”, “scheduled”, “estimates”, “forecasts”, “strategy”, “target”, “intends”, “objective”, “goal”, “understands”, “anticipates” and “believes” (and variations of these or similar words) and statements that certain actions, events or results “may”, “could”, “would”, “should”, “might” “occur” or “be achieved” or “will be taken” (and variations of these or similar expressions). Forward-looking information is also identifiable in statements of currently occurring matters which may continue in the future, such as “providing the Company with”, “is currently”, “allows/allowing for”, “will advance” or “continues to” or other statements that may be stated in the present tense with future implications. All of the forward-looking information in this news release is qualified by this cautionary note.

Forward-looking information in this news release includes, but is not limited to, statements regarding the exercise of the option rights to increase the Company’s interest in the Lagoa Salgada Project, the acceleration of exploration activities at the Lagoa Salgada Project, the material growth of the Company’s exposure to the base metal market and the existence of significant exploration upside. Forward-looking information is not, and cannot be, a guarantee of future results or events. Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by Ascendant at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information. The material factors or assumptions that Ascendant identified and were applied by Ascendant in drawing conclusions or making forecasts or projections set out in the forward-looking information include, but are not limited to, the ability of the Company to carry on an extensive exploration program, the ability of the Company to fund the exploration activities and to make the required payments to earn its additional interest in Redcorp, the ability of the Lagoa Salgada Project to increase the Company’s exposure to the base metal market, and other events that may affect Ascendant’s ability to develop its project; and no significant and continuing adverse changes in general economic conditions or conditions in the financial markets.

The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, risks generally associated with the mining industry, such as economic factors (including future commodity prices, currency fluctuations, energy prices and general cost escalation), uncertainties related to the development and operation of Ascendant’s projects, exploration activities, dependence on key personnel and employee and union relations, risks related to political or social unrest or change, rights and title claims, operational risks and hazards, including unanticipated environmental, industrial and geological events and developments and the inability to insure against all risks, failure of plant, equipment, processes, transportation and other infrastructure to operate as anticipated, compliance with government and environmental regulations, including permitting requirements and anti-bribery legislation, volatile financial markets that may affect Ascendant’s ability to obtain additional financing on acceptable terms, the failure to obtain required approvals or clearances from government authorities on a timely basis, uncertainties related to the geology, continuity, grade and estimates of mineral reserves and resources, and the potential for variations in grade and recovery rates, uncertain costs of reclamation activities, tax refunds, hedging transactions, as well as the risks discussed in Ascendant’s most recent Annual Information Form on file with the Canadian provincial securities regulatory authorities and available at www.sedar.com.

Should one or more risk, uncertainty, contingency, or other factor materialize, or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, the reader should not place undue reliance on forward-looking information. Ascendant does not assume any obligation to update or revise any forward-looking information after the date of this news release or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law.

____________________________
1 Gibbons, Wes & Moreno, Teresa, Ph.D. & Geological Society of London (2002) The geology of Spain. Geological Society, London

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Ascendant Resources Announces Q2 2018 Production Results, Continues Growth For Sixth Consecutive Quarter

Q2 2018 Production Highlights:

  • Record contained metal production of 22.9 million ZnEq lbs, an increase of 7% over Q1 2018 and 49% over Q2 2017
  • ZnEq grade of 6.3%, representing an increase of 3% over 6.1% ZnEq in Q1 2018 and a 14% increase over 5.5% ZnEq in Q2 2017
  • Quarterly tonnes milled of 192,428 vs 186,955 tonnes in Q1 2018 and 150,785 in Q2 2017

TORONTO, July 12, 2018 (GLOBE NEWSWIRE) — Ascendant Resources Inc. (TSX:ASND) (OTCQX:ASDRF) (FRA:2D9) (“Ascendant” or the “Company”) announces production results from its El Mochito mine for the second quarter of 2018 demonstrating continued operational improvements highlighted by an average head grade of 6.3% ZnEq, and record contained metal production for the quarter of 22.9 million ZnEq lbs, an increase of 7% over the first quarter 2018 and 49% over the second quarter 2017.

Q2 2018 Operational Performance

During the second quarter of 2018, Ascendant produced yet another record of contained zinc equivalent metal production with production of 22.9 million ZnEq lbs, compared to 21.4 million ZnEq lbs in the first quarter of 2018 and 15.4 million lbs in the second quarter of 2017. This represents Ascendant’s sixth consecutive quarter of metal production growth. Zinc grades showed a further improvement through the quarter increasing by 2% from 4.2% zinc in Q1 2018 to 4.3% zinc in Q2 2017 (27% increase from 3.4% zinc in Q2 2017). Silver grades similarly showed a slight increase over the previous quarter. Lead grades were 5% lower at 1.5% in Q2 versus 1.6% in Q1 but were 15% higher than Q2 2017 when the lead head grade was 1.3%. Recovery rates have modestly improved over the previous quarter.

Increased conventional mining from the high-grade Imperial, Barbasco, Port Royal and San Juan “chimney” ore-bodies had a positive impact on grade for the quarter combined with better dilution controls in the mantos areas. The success experienced at the higher-grade Esperanza orebody in the first quarter slowed into the second quarter as the number of working faces increased but could not be accessed due to additional ventilation requirements. This has now been addressed.

Milled production for the quarter was up slightly (3%) at 192,428 tonnes compared to the first quarter 2018 production of 186,955 tonnes and up 28% versus Q2 2017 (150,785 tonnes). June’s performance was impacted by four days of lost production caused by issues experienced with the shaft loading pocket, a failure of a main bearing on the primary screen in the plant and inclement weather which affected power to the mine. These issues have since been remedied.

Overall, Ascendant continues to see higher throughput rates with increased grade as it continues to focus on dilution control and greater contribution from conventional mining in the higher-grade chimneys. Management expects tonnes processed and ore grades to continue trending higher over the course of the year. This quarter also saw the largest contribution from long-hole stoping since Ascendant gained control of the mine; the introduction of this lower cost mining methodology is well ahead of schedule at the mine and will continue to become a greater percentage of production. The Company’s cash balance was US$11.3 million at June 30, 2018.

Two remaining bolters arrived and were made operational during the quarter, setting the stage for increased development moving forward. The Company expects delivery of the final two trucks ordered early in Q3.

Operational performance for Q2 2018 relative to Q1 2018 and 2017 is provided in the table below:

 
 20182017 
UnitsQ2Q1Q4Q3Q2Q1 
Ore Milledtonnes  192,428  186,955  198,354  176,035  150,785  131,116
Average Head GradeZinc%4.3.%4.2%3.7%3.5%3.4%3.4%
Lead%1.5%1.6%1.4%1.5%1.3%1.3%
Silverg/t484634384952
Zinc equivalent grade*%6.3%6.1%5.3%5.4%5.5%5.6%
Average RecoveriesZinc%89.7%89.3%88.5%88.8%88.9%89.8%
Lead%79.1%76.7%74.6%73.7%72.3%76.9%
Silver%79.4%78.3%75.0%78.0%79.3%78.8%
Contained Metal ProductionZinc000’s lbs16,34315,30114,13312,1009,9338,888
Lead000’s lbs5,1095,1254,5564,1753,2162,957
Silverozs229,043215,599169,039168,181188,245173,041
Zinc equivalent metal*000’s lbs22,92621,41219,57617,49515,37713,672
*Calculated from average Q2 2018 metal prices of US$1.41/lb for zinc, US$1.08 for lead, and US$16.40 Ag for silver
 

President and CEO Chris Buncic stated: “We are pleased to demonstrate yet another strong operational quarter with record contained metal production exceeding the previous quarter’s record, while at the same time delivering improved zinc equivalent grades. The arrival of the remaining outstanding conventional mining equipment enabled us to increase conventional mining benefitting our volumes and grade profile. We will continue to focus on lower cost mining methods and improved grade control to improve our overall cost per tonne produced.”

Update on Long-Term Optimization Plans at El Mochito

Since acquiring the El Mochito mine in December 2016, Ascendant’s primary objective was to rehabilitate the El Mochito mine targeting increased production, reduced costs and returning the mine to profitability in a stronger zinc commodity price environment. During 2017, production grew by 81%, direct operating cost were decreased by 31% and by the third quarter of 2017 the mine had achieved positive EBITDA and by the fourth quarter positive Free Cash Flow. As can be seen by results above, during 2018 the El Mochito mine has continued to see growth in production volumes, costs have continued to decline, and the mine continues to show improvement in almost all metrics.

In January of 2018 Ascendant management engaged third party technical and engineering firms to assist with the objective of making the El Mochito mine robust and profitable in any reasonable zinc price environment. The recent completion of the NI 43-101 Mineral Reserves and Resources Estimate and Technical Report for El Mochito (see press release of April 10, 2018), outlining Proven and Probable Reserves providing for a mine life of more than 7 years, formed a solid foundation for this analysis.

Management is currently near the completion of its detailed engineering and technical analysis, and expects that once implemented, the optimization plans will position the mine to deliver strong EBITDA and robust Free Cash Flow at consensus long-term metal prices.

The focus of the analysis has been on lowering sustainable operating and capital costs through underground mine improvements, plant upgrades and improved long term water and tailings management systems.  A large part of the study is focused on materially shortening the long-term haul distances of the underground mining fleet as the new Reserves, Resources and expected future exploration discoveries continue to extend the ore body to the East of current mine infrastructure.

Full details are expected to be released during the third quarter.

President and CEO Chris Buncic continued, “During the second quarter, realized metal prices were lower than anticipated impacting our expected cash flow generation, and this remains so in the short-term due to global trade concerns and the perceived uncertainty from the demand-side. We remain positive on metal prices going forward but are cognizant of El Mochito’s sensitivity to metal prices. As such, we continue to press for further long-term operational improvements to drive our costs lower, improve profitability in the short-term and set the mine on a profitable path in any reasonable metals price environment. We expect to be in a position to provide more details on our long-term optimization plans shortly.”

Second Quarter 2018 Conference Call

Ascendant plans to release second quarter 2018 financial results after market close on August 8, 2018. A conference call will be held on August 9, 2018, at 10:00am EDT to discuss second quarter 2018 operational and financial results.

Conference Call Details:
Date of Call: Thursday, August 9, 2018
Time of Call: 10:00am EDT
Conference ID: 3172066
Dial-In Numbers:
North American Toll-Free: 1-833-696-8362
International: 1-612-979-9908

About Ascendant Resources Inc.

Ascendant is a Toronto-based mining company focused on its 100%-owned El Mochito zinc-lead-silver mine in north-western Honduras, which has been in production since 1948. After acquiring the mine in December 2016, Ascendant implemented a rigorous optimization program aimed at restoring the historic potential of the El Mochito mine. In 2017, the Company successfully completed the operational turnaround with sustained production reaching record levels and profitability restored. The Company remains focused on cost reduction and further operational improvements to drive robust free cash flow in 2018 and beyond. Ascendant is also focused on expanding and upgrading known resources through extensive exploration work for near-term growth. With a significant land package of 11,000 hectares and an abundance of historical data there are several regional targets providing longer term exploration upside which could lead to further resource growth. The Company is also engaged in the evaluation of producing and development stage mineral resource opportunities, on an ongoing basis. The Company’s common shares are principally listed on the Toronto Stock Exchange under the symbol “ASND”. For more information on Ascendant Resources, please visit our website at www.ascendantresources.com.

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

For further information please contact:
Katherine Pryde
Director, Communications & Investor Relations
Tel: 888-723-7413

info@ascendantresources.com

Cautionary Notes to US Investors

The information concerning the Company’s mineral properties has been prepared in accordance with National Instrument 43-101 (“NI-43-101”) adopted by the Canadian Securities Administrators. In accordance with NI-43-101, the terms “mineral reserves”, “proven mineral reserve”, “probable mineral reserve”, “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” are defined in the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”) Definition Standards for Mineral Resources and Mineral Reserves adopted by the CIM Council on May 10, 2014. While the terms “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” are recognized and required by NI 43-101, the U.S. Securities Exchange Commission (“SEC”) does not recognize them. The reader is cautioned that, except for that portion of mineral resources classified as mineral reserves, mineral resources do not have demonstrated economic value. Inferred mineral resources have a high degree of uncertainty as to their existence and as to whether they can be economically or legally mined. It cannot be assumed that all or any part of any inferred mineral resource will ever be upgraded to a higher category. Therefore, the reader is cautioned not to assume that all or any part of an inferred mineral resource exists, that it can be economically or legally mined, or that it will ever be upgraded to a higher category. Likewise, you are cautioned not to assume that all or any part of a measured or indicated mineral resource will ever be upgraded into mineral reserves.

Readers should be aware that the Company’s financial statements (and information derived therefrom) have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board and are subject to Canadian auditing and auditor independence standards. IFRS differs in some respects from United States generally accepted accounting principles and thus the Company’s financial statements (and information derived therefrom) may not be comparable to those of United States companies.

Forward Looking Information
               
This news release contains “forward-looking statements” and “forward-looking information” (collectively, “forward-looking information”) within the meaning of applicable Canadian securities legislation. All information contained in this news release, other than statements of current and historical fact, is forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as “plans”, “expects”, “budget”, “guidance”, “scheduled”, “estimates”, “forecasts”, “strategy”, “target”, “intends”, “objective”, “goal”, “understands”, “anticipates” and “believes” (and variations of these or similar words) and statements that certain actions, events or results “may”, “could”, “would”, “should”, “might” “occur” or “be achieved” or “will be taken” (and variations of these or similar expressions). Forward-looking information is also identifiable in statements of currently occurring matters which may continue in the future, such as “providing the Company with”, “is currently”, “allows/allowing for”, “will advance” or “continues to” or other statements that may be stated in the present tense with future implications. All of the forward-looking information in this news release is qualified by this cautionary note.

Forward-looking information in this news release includes, but is not limited to, statements regarding the consistency of processing recovery levels, improvements of grades in 2018, deployment of new mining equipment, increase in contained metal production, maintenance of production rates, increase of mill feed grades, reduction of costs, the ability to fully fund planned development, exploration expenditures and the undertaking of various long-term optimization programs. Forward-looking information is not, and cannot be, a guarantee of future results or events. Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by Ascendant at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information. The material factors or assumptions that Ascendant identified and were applied by Ascendant in drawing conclusions or making forecasts or projections set out in the forward-looking information include, but are not limited to, the ability of the Company to maintain the consistency of processing recovery levels, to improve grades in 2018, to deploy new mining equipment, increase contained metal production, maintain production rates, increase mill feed grades, reduce costs, fully fund planned development, exploration and capital expenditures  and undertake various long-term optimization programs and other events that may affect Ascendant’s ability to develop its project; and no significant and continuing adverse changes in general economic conditions or conditions in the financial markets.

The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, risks generally associated with the mining industry, such as economic factors (including future commodity prices, currency fluctuations, energy prices and general cost escalation), uncertainties related to the development and operation of Ascendant’s projects, dependence on key personnel and employee and union relations, risks related to political or social unrest or change, rights and title claims, operational risks and hazards, including unanticipated environmental, industrial and geological events and developments and the inability to insure against all risks, failure of plant, equipment, processes, transportation and other infrastructure to operate as anticipated, compliance with government and environmental regulations, including permitting requirements and anti-bribery legislation, volatile financial markets that may affect Ascendant’s ability to obtain additional financing on acceptable terms, the failure to obtain required approvals or clearances from government authorities on a timely basis, uncertainties related to the geology, continuity, grade and estimates of mineral reserves and resources, and the potential for variations in grade and recovery rates, uncertain costs of reclamation activities, tax refunds, hedging transactions, as well as the risks discussed in Ascendant’s most recent Annual Information Form on file with the Canadian provincial securities regulatory authorities and available at www.sedar.com.

Should one or more risk, uncertainty, contingency, or other factor materialize, or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, the reader should not place undue reliance on forward-looking information. Ascendant does not assume any obligation to update or revise any forward-looking information after the date of this news release or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law.

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El Mochito Delivers High-Grade Intercepts Including 8.6 Metres at 9.6% Zinc Equivalent in Drilling Subsequent to Recent Resource Update

Ascendant Resources Inc. (TSX:ASND) (OTCQX:ASDRF) (FRA:2D9) (“Ascendant” or the “Company”) is pleased to announce results from 40 diamond drill holes (12,015 metres) as part of the 2018 exploration and definition drilling program at its El Mochito mine in Honduras. These results come after the release of the Company’s newly reported Mineral Resources and Reserves Estimate and National Instrument 43-101 Technical Report (see press release dated May 28th, 2018), which almost tripled contained zinc in Mineral Reserves and extended its life of mine to more than 7 years. The drilling is split between step-out (66%) and in-fill (34%) drill holes, and targets extensions of four ore bodies, namely Porvenir, Santa Elena, Port Royal Manto and Esperanza (See Figure 1 and Tables 1 & 2 below). These results continue to support the Company’s goals of increasing tonnage for further Mineral Reserve and Resource growth and identifying higher-grade ore at El Mochito that can quickly be brought into the mine plan.

Key Highlights (true/apparent widths1) Include:

Step-out Drilling

  • DDH 10956 – 1.4m at 35.8% ZnEq2, 20.1% Zn, 13.4% Pb and 318 g/t Ag (Porvenir)
  • DDH 10958 – 6.3m at 12.6% ZnEq, 6.2% Zn, 5.6% Pb and 125.2 g/t Ag (Santa Elena)
  • DDH 10949 – 8.6m at 9.6% ZnEq, 5.7% Zn, 3.4% Pb and 75.8 g/t Ag (Esperanza)
  •            and – 7.5m at 8.9% ZnEq, 5.5% Zn, 3.3% Pb and 41.4 g/t Ag

Infill Drilling

  • DDH 10957 – 17.7m at 9.1% ZnEq, 5.9% Zn, 2.9% Pb and 59.9 g/t Ag (Esperanza)
  • DDH 10959 – 14.6m at 9.5% ZnEq, 7.0% Zn, 1.8% Pb and 64.9 g/t Ag (Esperanza)
  • DDH 10950 – 4.1m at 15.3% ZnEq, 15.1% Zn, 0.1% Pb and 6.4 g/t Ag (Santa Elena)
  • DDH 10902 – 3.9m at 9.9% ZnEq, 8.0% Zn, 0.6% Pb and 101.6 g/t Ag (Port Royal Manto)

_________________________________
1
Please refer to tables for true/apparent widths which are estimated from actual drilled lengths.
2 ZnEq grades in % represents zinc grade together with the lead and silver grades (zinc equivalent) in terms of zinc using certain metal price, payable metal, and processing recoveries assumptions: Metal prices – Zn$1.21/lb, Pb$1.06/lb, Ag$18.00/oz; processing recoveries – Zn 88.9%, Pb 74.3%, Ag 77.7%.

The newly developed Esperanza Orebody has already contributed significantly towards first and second quarter 2018 production and is expected to continue to do so for at least the next two years without the addition of these new results. The Santa Elena Orebody forms part of the El Mochito production plan in 2019 and beyond, which before these results represented approximately 18% of the Measured and Indicated Mineral Resources. The Porvenir Orebody is newly defined and is part of the Inferred Mineral Resource, and this drilling will form part of its further definition and delineation.

A total of 40,000 metres of exploration & definition drilling is planned at El Mochito for 2018. All orebodies remain open along strike and at depth.

Chris Buncic, President and CEO of Ascendant commented: “We are extremely pleased with these results as the intercepts reported herein continue to demonstrate high-grade mineralization above current mining grades and the newly defined reserve and resource grades. This provides management with even greater confidence in identifying further opportunities for reserve and resource conversion and growth as we continue our aggressive 40,000 metre exploration program in 2018 and remain focused on our long-term goal of increasing head grade to the mill and the value per tonne mined.”

He continued: “Much of the 2017 exploration program was focused on near mine reserve and resource conversion and growth supporting our recent NI 43-101 resource estimate update and the theory new near-mine material can be brought into production quickly, which we were very successful in achieving. These results today also incorporate step-out drilling on regional target Porvenir and have successfully identified significant mineralization warranting further follow up on this target and other regional targets like this with the goal of identifying long-term resource growth opportunities positioning El Mochito well into the future.”

Figure 1: Drill Hole Location Map

http://www.globenewswire.com/NewsRoom/AttachmentNg/52a59039-0c13-468e-8069-dc2c213418da

Table 1: Significant Assays
Drill Hole
Category
DDH No.From
(m)
To
(m)
Length
(m)
True /
Apparent
Width (m)*
Ag (g/t)Pb (%)Zn (%)ZnEq
(%)**
Area
Step Out1095611.612.81.21.21264.52.97.128.3Porvenir
including11.612.50.90.9601.02.62.413.5
including12.512.80.30.33255.03.621.272.6
and19.823.53.73.7121.02.42.36.1
including19.820.60.80.8229.06.77.016.0
including20.622.41.81.824.00.00.00.4
including22.423.51.11.1210.03.52.88.8
and79.681.31.71.7165.07.28.416.7
Step Out10961100.0101.01.10.9456.00.30.37.3Porvenir
and128.8130.51.71.4318.013.420.135.8
Step Out1096343.044.21.21.285.07.711.118.7Porvenir
Step Out1097722.324.42.12.121.02.23.35.4Porvenir
and38.439.71.31.348.03.75.28.9
and207.6209.72.12.123.01.92.34.2
Step Out10952298.4300.42.02.0106.66.17.714.3Santa Elena
including298.4299.61.21.2138.09.911.121.3
including299.6300.40.80.860.00.52.74.0
and398.7404.05.35.027.11.54.96.6
including398.7399.91.21.139.03.45.48.8
including399.9401.01.11.03.00.10.70.9
including401.0404.03.02.931.01.36.27.7
and412.6415.42.82.890.26.38.214.7
including412.6414.21.61.6156.011.011.622.9
including414.2415.41.21.23.00.03.83.8
and422.3423.81.51.48.00.06.26.4
Step Out10954314.1315.21.00.938.00.126.427.0Santa Elena
and530.5537.16.65.935.01.42.74.4
including530.5533.42.92.655.01.72.85.0
including533.4535.21.81.611.00.11.61.8
including535.2537.11.81.627.02.23.75.9
and542.5545.02.42.251.50.88.610.0
including542.5543.81.21.188.00.714.716.6
including543.8545.01.21.115.00.82.53.4
Step Out10958582.9589.06.15.172.25.35.310.7Santa Elena
including582.9584.31.41.145.04.93.78.4
including584.3585.20.90.814.01.71.73.3
including585.2589.03.83.295.96.26.713.2
and591.9599.57.66.3125.25.66.212.6
including591.9592.80.90.884.04.85.610.9
including592.8595.62.72.3253.610.110.922.9
including595.6597.11.51.373.04.44.28.9
including597.1599.52.42.028.91.52.44.1
and606.2609.63.42.781.43.94.89.2
including606.2608.11.81.4110.05.76.212.5
including608.1609.61.51.247.01.73.15.1
Step Out10947560.2561.41.20.929.01.52.94.6Santa Elena
and562.4565.43.02.54.00.04.24.2
including562.4563.91.51.24.15.00.04.2
including563.9565.41.51.24.13.00.04.1
and580.9582.31.41.145.00.44.25.2
Step Out10962486.5489.53.02.666.06.07.213.1Santa Elena
Step Out10964468.7470.11.51.434.01.37.48.9Santa Elena
and544.4546.52.11.989.30.35.77.3
Step Out10966460.6464.03.42.97.80.39.710.0Santa Elena
including460.6462.11.51.310.00.46.97.4
including462.1464.01.91.66.00.111.912.1
Step Out10949360.2370.810.78.675.83.45.79.6Esperanza
including360.2362.92.72.298.23.95.710.3
including362.9363.91.10.925.00.55.56.3
including363.9367.33.42.794.14.36.911.9
including367.3369.42.11.757.02.73.76.7
including369.4370.81.41.156.03.66.310.1
and371.8381.09.27.541.43.35.58.9
including371.8372.91.10.923.02.42.64.9
including372.9374.11.21.054.03.57.110.7
including374.1375.21.10.931.02.44.77.1
including375.2378.02.72.254.74.17.711.9
including378.0381.03.02.535.03.24.47.6
Step Out10944No significant InterceptsEsperanza
Step Out10946No significant InterceptsEsperanza
Step Out10948382.0385.33.22.773.20.25.26.5Esperanza
including382.0383.71.71.476.00.46.78.1
including383.7385.31.51.370.00.03.64.7
and390.8392.01.21.06.00.07.47.5
Step Out10951354.8356.61.81.418.00.33.64.1Esperanza
and360.2362.92.72.314.51.42.84.1
and374.6375.91.21.056.02.62.95.8
Step Out10960429.0437.18.16.424.80.55.66.4Esperanza
including429.0434.05.04.013.50.06.97.1
including434.0437.13.02.443.61.43.45.2
Infill10950353.7354.81.11.077.00.79.811.5Santa Elena
and504.7509.04.33.936.90.77.08.2
including504.7506.31.51.419.01.87.29.0
including506.3507.81.51.437.00.14.14.8
including507.8509.01.21.159.00.110.511.4
and513.3517.74.44.16.40.115.115.3
including513.3515.11.81.75.00.17.57.6
including515.1517.72.62.47.40.220.420.7
Infill1096891.693.31.71.237.01.64.56.4Port Royal Mto
and117.8128.310.56.9116.10.73.76.0
including117.8118.91.10.750.03.25.58.8
including118.9121.93.02.01.60.00.10.2
including121.9123.41.61.0113.00.48.810.8
including123.4125.01.51.064.00.20.81.9
including125.0126.51.51.026.00.24.75.2
including126.5128.31.81.2463.01.35.613.6
and130.9136.65.73.9101.60.68.09.9
including130.9132.61.71.137.00.14.04.6
including132.6136.64.12.8128.30.89.612.2
Infill1097273.674.91.21.023.01.72.84.5Port Royal Mto
and82.183.21.11.028.00.18.18.6
and85.389.34.03.427.30.23.64.2
Infill1097462.864.01.21.228.00.112.713.2Port Royal Mto
Infill10978No significant InterceptsPort Royal Mto
Infill10980No significant InterceptsPort Royal Mto
Infill10983107.3111.34.02.069.52.26.89.6Port Royal Mto
including107.3109.72.41.293.02.29.412.6
including109.7111.31.50.832.02.42.54.9
Infill10953297.8298.91.11.061.03.64.88.6Esperanza
and306.3314.98.57.474.55.46.412.0
including306.3307.51.21.193.01.14.06.3
including307.5311.23.73.275.85.67.112.8
including311.2312.71.51.355.06.04.810.6
including312.7314.92.11.975.67.27.814.8
and321.3324.53.22.85.90.13.94.1
and327.1328.61.51.46.00.14.54.7
and331.0333.82.72.528.10.65.96.8
including331.0332.21.21.117.00.54.14.7
including332.2333.81.51.437.00.67.38.4
Infill10955374.1375.31.21.143.00.83.54.7Esperanza
and381.1388.67.56.251.02.16.28.7
including381.1384.43.32.7100.84.58.113.2
including384.4388.64.33.513.00.44.85.3
Infill10957359.7381.021.317.759.92.95.99.1Esperanza
including359.7362.73.02.572.02.87.510.8
including362.7364.21.51.322.00.56.97.6
including364.2365.81.51.3130.04.79.014.8
including365.8370.34.63.879.93.14.48.2
including370.3371.61.21.069.03.66.210.2
including371.6372.50.90.85.00.00.20.3
including372.5373.71.21.025.02.32.95.2
including373.7381.07.36.146.93.36.49.8
Infill10959357.7375.217.514.664.91.87.09.5Esperanza
including357.7358.40.60.528.02.22.85.0
including358.4365.57.15.9138.64.19.014.4
including365.5366.71.21.03.00.21.41.6
including366.7375.28.57.115.10.26.46.8
and378.4379.61.21.12.00.04.24.2
Infill1096547.559.411.911.349.74.34.38.5Esperanza
including47.551.84.34.150.74.54.38.7
including51.856.44.64.363.35.65.110.7
including56.457.91.51.423.01.51.73.3
including57.959.41.51.433.02.44.16.5
Infill10967No significant InterceptsEsperanza
Infill1096949.654.95.25.259.42.96.710.0Esperanza
including49.650.61.01.051.04.34.99.2
including50.653.32.72.766.42.88.711.9
including53.354.91.51.552.02.24.36.9
and57.558.71.21.126.02.62.75.2
Infill1097059.660.81.20.950.03.54.48.0Esperanza
Infill1097111.915.23.33.318.00.411.111.8Esperanza
and39.844.24.44.212.10.47.98.4
including39.841.11.31.317.01.24.55.7
including41.144.23.02.910.00.09.49.5
and47.284.136.98.252.02.96.09.2
including47.251.84.61.0115.34.06.911.9
including51.853.61.80.448.01.61.33.3
including53.657.03.40.761.23.09.012.3
including57.062.45.41.240.63.94.28.0
including62.470.78.31.814.80.57.88.4
including70.772.21.50.334.01.13.55.0
including72.273.81.50.368.04.36.010.5
including73.874.91.10.315.00.40.61.1
including74.976.21.30.346.02.43.05.6
including76.284.17.91.865.74.96.411.4
Infill1097553.278.225.024.157.54.15.39.6Esperanza
including53.260.06.96.687.67.07.514.5
including60.065.55.55.351.74.74.59.1
including65.567.21.71.621.01.81.53.3
including67.273.86.66.241.22.96.49.4
including73.875.61.81.741.00.52.03.0
including75.678.22.62.568.02.93.66.9
Infill1097611.619.17.66.1105.06.77.414.5Esperanza
including11.618.16.55.3114.17.18.015.5
including18.119.11.00.848.04.33.98.1
and40.451.811.47.129.81.96.38.3
including40.441.81.40.942.02.84.27.1
including41.842.70.90.613.01.12.13.2
including42.743.60.90.675.06.511.417.9
including43.645.41.81.125.02.23.05.2
including45.451.86.44.024.51.07.78.8
and62.564.31.81.248.00.63.44.6
Infill1097911.021.310.49.634.92.13.25.4Esperanza
including11.013.42.42.346.53.33.56.9
including13.415.21.81.710.00.80.31.1
including15.221.36.15.637.82.04.06.2
and27.432.04.63.634.01.06.07.4
and39.047.28.27.626.90.45.15.9
including39.040.21.21.127.00.35.15.8
including40.241.61.41.311.00.51.31.9
including41.643.01.41.332.00.311.312.0
including43.044.21.21.115.00.12.12.4
including44.245.71.51.454.01.12.64.3
including45.747.21.51.419.00.28.08.4
Infill1098115.824.48.68.2119.76.67.214.4Esperanza
including15.816.81.01.082.03.24.58.3
including16.823.26.46.1137.87.47.916.0
including23.224.41.21.256.05.05.510.5
and26.828.71.91.831.02.82.65.4
and36.843.97.12.951.84.24.08.2
including36.838.41.60.656.05.35.811.0
including38.440.21.80.751.01.92.04.4
including40.243.93.71.550.44.84.39.0
and46.051.75.72.141.70.19.510.2
including46.047.21.20.527.00.07.78.1
including47.248.81.50.673.00.12.43.5
including48.851.72.91.131.60.113.914.5
and84.189.35.22.112.90.78.69.4
including84.188.44.31.712.50.79.710.4
including88.489.30.90.415.01.03.44.4
Infill1098411.915.23.43.459.34.74.39.1Esperanza
and18.325.97.67.655.02.28.711.3
including18.321.63.43.471.14.87.812.8
including21.622.91.21.252.00.24.95.8
including22.924.41.51.539.00.115.916.6
including24.425.91.51.538.00.26.67.3
and28.329.91.51.417.00.15.25.5
and40.245.14.94.921.30.310.010.5
including40.241.51.21.225.00.38.89.4
including41.543.92.42.417.50.213.614.0
including43.945.11.21.225.00.44.04.7
Infill1098515.223.58.27.935.22.62.85.5Esperanza
including15.218.12.92.838.73.23.26.3
including18.118.90.80.710.00.60.61.2
including18.923.54.64.437.12.53.05.6
and26.828.71.81.811.00.04.34.5
and41.844.22.42.311.00.28.89.2
including41.843.01.21.15.00.417.718.3
including43.044.21.21.117.00.411.011.6
Infill1098919.227.78.53.739.02.93.06.0Esperanza
including19.221.01.80.857.04.23.67.8
including21.022.91.90.817.00.50.51.2
including22.926.23.41.533.82.72.85.6
including26.227.71.50.757.04.85.910.6
and35.147.212.26.050.41.25.67.3
including35.140.55.52.739.02.07.810.0
including40.542.72.11.037.00.43.03.9
including42.747.24.62.270.30.64.15.6
* True Thickness and apparent widths are estimates.
** Price assumptions used were US$1.21/lb Zn, US$1.06/lb Pb and US$18/troy oz Ag. Zinc equivalent metal grade (ZnEq. %) was calculated as follows:  Zn% +(Pb x 0.82) +(Ag g/t x 0.0149) = ZnEq%  and is based on 88.9% Zn recovery, 74.3% Pb recovery and 77.7% Ag
Table 2: Collar Table
UTM Coordinates  (WGS84Z16N)
AreaDrill Hole
Category
Mine
Level
(ft)
DDH No.Easting
(m)
Northing
(m)
Elev.
(m)
Azi.Incl.Length
(m)
Year
EsperanzaStep out181410944381,7501,643,09540916-38533.42017
EsperanzaStep out181410946381,7491,643,09540916-43486.22017
EsperanzaStep out181410948381,7491,643,0954092-46414.22017
EsperanzaStep out181410949381,7491,643,0964092-50401.72017
EsperanzaStep out181410951381,7491,643,096409355-51396.22017
EsperanzaStep out181410960381,7501,643,09641010.5-40.4457.22017
PorvenirStep out279010956384,2901,642,3571133580627.32017
PorvenirStep out279010961384,2901,642,35711435936269.42017
PorvenirStep out279010963384,3811,642,35011316.21.7489.82017
PorvenirStep out279010976381,7811,643,195170310-3591.42018
Santa ElenaStep out268010947383,3771,643,00812528-53600.52017
Santa ElenaStep out268010952383,3781,643,00612557-59448.12017
Santa ElenaStep out268010954383,3781,643,00712558-50556.32017
Santa ElenaStep out268010958383,3771,643,00712529.5-50.5630.92017
Santa ElenaStep out268010962383,3791,643,00612579.8-53.2498.02017
Santa ElenaStep out268010964383,3781,643,00712560.5-55.4573.02017
Santa ElenaStep out268010966383,3781,643,00612581.262.1474.92017
EsperanzaInfill181410953381,7491,643,095409360-56356.62017
EsperanzaInfill181410955381,7501,643,09540920-47429.82017
EsperanzaInfill181410957381,7491,643,0954096-48390.12017
EsperanzaInfill181410959381,7501,643,09540920-51396.22017
EsperanzaInfill260510965381,7801,643,1931712702167.12017
EsperanzaInfill260510967381,7801,643,19317227436.879.22017
EsperanzaInfill260510968382,3101,642,558192360-38.6157.02017
EsperanzaInfill260510969381,7811,643,1941702851102.42017
EsperanzaInfill260510970381,7811,643,195170305067.12017
EsperanzaInfill260510974382,3101,642,557192360-8067.12018
EsperanzaInfill260510975381,7811,643,195170320-16.5104.52018
EsperanzaInfill260510978382,3091,642,558192344.2-50117.32018
EsperanzaInfill260510980382,3091,642,558192347-35.7188.72018
EsperanzaInfill260510983382,3091,642,557192328-50.8128.02018
EsperanzaInfill260510984381,7811,643,193169270-59.555.22018
EsperanzaInfill260510985381,7811,643,192169250-6562.52018
EsperanzaInfill260510989381,7801,643,192170257-2559.42018
Port Royal MtoInfill245010971381,7811,643,194170286.5-14.5112.82017
Port Royal MtoInfill245010972382,3101,642,557192358.7-55.4112.82018
Port Royal MtoInfill240510977384,3821,642,35111116-40.5323.72018
Port Royal MtoInfill245010979381,7811,643,195169294-6553.32018
Port Royal MtoInfill245010981381,7801,643,193170270-19.297.82018
Santa ElenaInfill268010950383,3771,643,00712540-48537.42017

Quality Assurance and Quality Control

Analytical work was carried out by Bureau Veritas Commodities Canada Ltd. (ACME), Vancouver, Canada.  Drill core samples were prepared in Bureau Veritas’s laboratory in Guatemala City, Guatemala. Pulp samples were then sent to their analytical Laboratory in Vancouver, Canada. All samples were analyzed for zinc, Lead, copper, iron and silver values determined by method code AR402 atomic absorption spectrometry, and any over limit values were determined using method code FA410. Bureau Veritas has routine quality control procedures which ensure that every batch of 40 prepared samples includes three sample repeats, two commercial standards and blanks. Bureau Veritas is independent from Ascendant. Ascendant used standard QA/QC procedures, when inserting blanks, for the drilling program.

Qualified Persons

The scientific and technical information in this press release has been reviewed and approved by Patrick E. Toth, P.Geo., Director Exploration to Ascendant and a Qualified Person as defined by National Instrument 43-101.

About Ascendant Resources Inc.

Ascendant is a Toronto-based mining company focused on its 100%-owned producing El Mochito zinc, silver and lead mine in west-central Honduras, which has been in production since 1948. After acquiring the mine in December 2016, Ascendant implemented a rigorous optimization program aimed at restoring the historic potential of the El Mochito mine. In 2017, the Company successfully completed the operational turnaround it set out to achieve with sustained production at record levels and profitability restored. The Company now remains focused on cost reduction and further operational improvements to drive robust free cash flow in 2018 and beyond. Ascendant is also focused on expanding and upgrading known resources through extensive exploration work for near-term growth. With a significant land package of 11,000 hectares and an abundance of historical data there are several regional targets providing longer term exploration upside which could lead to further resource growth. The Company is also engaged in the evaluation of producing and development stage mineral resource opportunities, on an ongoing basis. The Company’s common shares are principally listed on the Toronto Stock Exchange under the symbol “ASND”. For more information on Ascendant Resources, please visit our website at www.ascendantresources.com.

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

For further information please contact:

Katherine Pryde
Director, Communications & Investor Relations
Tel: 888-723-7413
info@ascendantresources.com

Cautionary Notes to US Investors

The information concerning the Company’s mineral properties has been prepared in accordance with National Instrument 43-101 (“NI-43-101”) adopted by the Canadian Securities Administrators. In accordance with NI-43-101, the terms “mineral reserves”, “proven mineral reserve”, “probable mineral reserve”, “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” are defined in the Canadian Institute of Mining, Metallurgy and Petroleum (the “CIM”) Definition Standards for Mineral Resources and Mineral Reserves adopted by the CIM Council on May 10, 2014. While the terms “mineral resource”, “measured mineral resource”, “indicated mineral resource” and “inferred mineral resource” are recognized and required by NI 43-101, the U.S. Securities Exchange Commission (“SEC”) does not recognize them. The reader is cautioned that, except for that portion of mineral resources classified as mineral reserves, mineral resources do not have demonstrated economic value. Inferred mineral resources have a high degree of uncertainty as to their existence and as to whether they can be economically or legally mined. It cannot be assumed that all or any part of any inferred mineral resource will ever be upgraded to a higher category. Therefore, the reader is cautioned not to assume that all or any part of an inferred mineral resource exists, that it can be economically or legally mined, or that it will ever be upgraded to a higher category. Likewise, you are cautioned not to assume that all or any part of a measured or indicated mineral resource will ever be upgraded into mineral reserves.

Readers should be aware that the Company’s financial statements (and information derived therefrom) have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board and are subject to Canadian auditing and auditor independence standards. IFRS differs in some respects from United States generally accepted accounting principles and thus the Company’s financial statements (and information derived therefrom) may not be comparable to those of United States companies.

Forward Looking Information
           
This news release contains “forward-looking statements” and “forward-looking information” (collectively, “forward-looking information”) within the meaning of applicable Canadian securities legislation. All information contained in this news release, other than statements of current and historical fact, is forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as “plans”, “expects”, “budget”, “guidance”, “scheduled”, “estimates”, “forecasts”, “strategy”, “target”, “intends”, “objective”, “goal”, “understands”, “anticipates” and “believes” (and variations of these or similar words) and statements that certain actions, events or results “may”, “could”, “would”, “should”, “might” “occur” or “be achieved” or “will be taken” (and variations of these or similar expressions). Forward-looking information is also identifiable in statements of currently occurring matters which may continue in the future, such as “providing the Company with”, “is currently”, “allows/allowing for”, “will advance” or “continues to” or other statements that may be stated in the present tense with future implications. All of the forward-looking information in this news release is qualified by this cautionary note.

Forward-looking information in this news release includes, but is not limited to, statements regarding the improvements of grades in 2018, the potential for ore bodies to be significantly larger than anticipated, the potential for larger source of feed and the potential to expand resources and grades. Forward-looking information is not, and cannot be, a guarantee of future results or events. Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by Ascendant at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information. The material factors or assumptions that Ascendant identified and were applied by Ascendant in drawing conclusions or making forecasts or projections set out in the forward-looking information include, but are not limited to, the size of the ore bodies, the ability to increase the feed and the ability to expand resources and grades at the Mine, and other events that may affect Ascendant’s ability to develop its project; and no significant and continuing adverse changes in general economic conditions or conditions in the financial markets.

The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, risks generally associated with the mining industry, such as economic factors (including future commodity prices, currency fluctuations, energy prices and general cost escalation), uncertainties related to the development and operation of Ascendant’s projects, dependence on key personnel and employee and union relations, risks related to political or social unrest or change, rights and title claims, operational risks and hazards, including unanticipated environmental, industrial and geological events and developments and the inability to insure against all risks, failure of plant, equipment, processes, transportation and other infrastructure to operate as anticipated, compliance with government and environmental regulations, including permitting requirements and anti-bribery legislation, volatile financial markets that may affect Ascendant’s ability to obtain additional financing on acceptable terms, the failure to obtain required approvals or clearances from government authorities on a timely basis, uncertainties related to the geology, continuity, grade and estimates of mineral reserves and resources, and the potential for variations in grade and recovery rates, uncertain costs of reclamation activities, tax refunds, hedging transactions, as well as the risks discussed in Ascendant’s most recent Annual Information Form on file with the Canadian provincial securities regulatory authorities and available at www.sedar.com.

Should one or more risk, uncertainty, contingency, or other factor materialize, or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, the reader should not place undue reliance on forward-looking information. Ascendant does not assume any obligation to update or revise any forward-looking information after the date of this news release or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law.

 

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Ascendant Resources Announces Free Cash Flow of $5.3 Million and Earnings of $0.07 Per Share in First Quarter 2018

Q1 2018 Highlights Include:

  • Net income of $5.29 million and earnings per share of $0.07
  • Adjusted EBITDA of $7.95 million; third consecutive quarter of positive adjusted EBITDA
  • Free cash flow of $5.30 million resulting in a cash balance of $13.26 million at March 31, 2018
  • Direct operating costs of $72.33/t, a decrease of 27% from Q1 2017 and 10% from Q4 2017
  • $28.04 million in revenue, a 254% increase over Q1 2017 and 17% increase over Q4 2017
  • ZnEq grade of 6.1%, an increase of 9% over Q1 2017 and 15% over Q4 2017
  • Record contained metal production of 21.4 million ZnEq lbs, an increase of 57% over Q1 2017 and 9% over Q4 2017

Ascendant Resources Inc. (TSX:ASND) (OTCQX:ASDRF) (FRA:2D9) (“Ascendant” or the “Company”) is pleased to report solid first quarter 2018 results from its El Mochito mine with $5.30 million in free cash flow and the Company’s first quarter of material net income of $5.29 million or earnings per share of $0.07. Contained metal production for the quarter was 21.4 million zinc equivalent1 lbs at an average head grade of 6.1%, representing the Company’s strongest quarter of production since assuming operation of the mine. These results demonstrate the Company’s continued delivery of improved efficiency in operations.

President and CEO Chris Buncic stated: “We are very pleased with the overall performance of the Company during the first quarter of this year. Our ability to deliver significant cost reductions over the previous quarter and to generate significant net income and free cash flow illustrates the true potential of the El Mochito mine. We will continue to push towards improving operating margins and sustainable long-term profitability. As we exit the quarter with a cash balance of over $13 million, free cash flow generation remains a key focus.”

He continued, “Operationally we are pleased with the increased throughput and higher head grades achieved this quarter. We look forward to improving these trends and continue to examine initiatives that will seek to make further structural improvements to our operational efficiency. We continue to make excellent progress on our 2018 exploration program and we look forward to providing an exploration update in the second quarter.”

____________________________
1 This figure was calculated on a spot metal price basis.

Summary of key operational and financial performance for the first quarter 2018 is provided in the tables below:

   Q1Q4Q1
Key Operating Information March 31,December 31,March 31,
   201820172017
Total Tonnes Mined tonnes  187,255  197,303  131,325
 
Total Tonnes Milled tonnes  186,955  198,354  131,116
Average Head Grades 
Average Zn grade%4.2%3.7%3.4%
Average Pb grade%