Mayfair Mining and Minerals Inc.

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ISIN : 578091 100
US$ 0.020
06/29 10:48 -
Prev close Open Low High Volume
0.020 0.020 0.020 0.020 5,000
Year l/h YTD var. 52 week l/h 52 week var. 1 month var.
 -  - - -  0.020 33.33% 33.33%
Shares OustandingShares Fully Diluted
Mkt Cap OustandingMkt Cap Fully Diluted
Produces Diamonds
Explores for Copper - Diamonds - Gold
Profile Press
Management Annual
Projects & res.
Asset profile
Last updated on : 2/13/2010


Mayfair Mining minerals inc files sec form 10-k annual report






Annual Report


Cautionary Statement about Forward-Looking Statements

This Annual Report on Form 10-K includes certain statements that may be deemed to be "forward-looking statements". All statements, other than statements of historical fact, included in this form 10KSB that address activities, events or developments that our management expects, believes or anticipates will or may occur in the future are forward-looking statements. Such forward-looking statements include discussion of such matters as:

The amount and nature of future capital, development and exploration expenditures;

The timing of exploration activities; and

Business strategies and development of our business plan.

Forward-looking statements also typically include words such as "anticipate", "estimate", "expect", "potential", "could" or similar words suggesting future outcomes. These statements are based on certain assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions, expected future developments and other factors we believe are appropriate in the circumstances. Such statements are subject to a number of assumptions, risks and uncertainties, including such factors as the volatility and level of gemstone prices, currency exchange rate fluctuations, uncertainties in cash flow, expected acquisition benefits, exploration mining and operating risks, competition, litigation, environmental matters, the potential impact of government regulations, and other matters discussed under the caption "Risk Factors", many of which are beyond our control. You are cautioned that forward-looking statements are not guarantees of future performance and that actual results or developments may differ materially from those expressed or implied in the forward-looking statements.

The Company is under no duty to update any of these forward-looking statements after the date of this report. You should not place undue reliance on these forward-looking statements.

Going-Concern - Presentation of Financial Statements

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. Since its inception in August 2002, the Company has generated little revenue and has incurred a net loss of $7,965,768 from inception through to March 31, 2008. Accordingly, the Company has not generated cash flow from operations and has primarily relied upon private placement of its common stock to fund its operations. As of March 31, 2008, the Company has working capital deficit of $600,877. These conditions raise substantial doubt about the Company's ability to continue as a going concern. The financial statements do not include any adjustment to reflect the possible future effects on the recoverability and classification of assets, or the amounts or classification of liabilities that may result from the possible inability of the Company to continue as a going concern. Management's plans with regard to these conditions are described below.

Plan of Operations

The Company is an exploration stage company, formed under the laws of the state of Nevada on August 14, 2002, to engage in the business of mining. The Company currently owns 2 prospective mining projects in Zambia. The Company's objective is to define sufficient mineral reserves on the properties to justify a full-scale mining operation. The Company conducts its operations in Zambia through its wholly owned subsidiary, Mayfair Mining & Minerals (UK) Ltd.

To date, Mayfair Mining, through its wholly owned subsidiary, Mayfair Mining and Minerals (UK) Limited has incorporated a Zambian joint venture company, Mayfair Mining & Minerals (Zambia) Limited, whose principal activity is to explore for and mine gold, platinum, uranium, copper and gemstones, particularly amethyst.

Results of Operations

For the fiscal year ended March 31, 2008, the Company experienced a consolidated net loss of $1,678,842 or $0.08 per share, compared to a consolidated net loss of $4,476,930 or $0.29 per share during the comparable period last year. The $2,798,088 decrease in consolidated net loss is primarily due to a reduction in impairment amounting to $1,000,133 and a decrease of $1,956,289 in compensation. Although there were sales during the fiscal year, there was not enough progress made subsequently and production was halted in late 2008.

Stock Based Compensation

Stock based compensation decreased $2,052,217 to $0. No further stock options have been granted to date. In accordance with ASC 718-10, the Company recognizes stock based compensation over the vesting period based upon the fair value of the options at date of grant. During 2006, the Company granted options to purchase 400,000 shares vesting immediately on grant at a price of $0.15 to employees and advisory board members. The Company recorded $376,000 of stock based compensation in 2006 relating to these options. During 2007, the Company granted options to purchase 200,000 shares vesting immediately on grant at a price of $0.15 and 2,000,000 shares vesting immediately on grant at a price of $0.50 to employees, advisory board members and consultants. The Company recorded stock based compensation of $2,052,217 during 2007 relating to these options.

Liquidity and Capital Resources

Cash Flows

During the fiscal year ended March 31, 2008, the Company utilized cash on hand and proceeds from share subscriptions received to fund its operations. As a result, cash and cash equivalents increased from $0 at March 31, 2007 to $59,977 at March 31, 2008.

Capital Resources

As of March 31, 2008, the Company had cash and cash equivalents of $59,977. Since inception, the company has relied primarily upon proceeds from private placement of its shares as its primary source of financing to fund its operations. We anticipate continuing to rely on sales of our common stock in order to continue to fund our business operations. Issuance of additional shares will result in dilution to our existing shareholders. There is no assurance that we will be able to complete any additional sales of our equity securities or that we will be able to arrange for other financing to fund our planned business activities.

Capital Requirements and Liquidity; Need for Subsequent Funding

As a result of the Company's limited capital resources, the Company has limited its exploration activities and administrative costs in Zambia to conserve capital while it tries to secure additional sources of capital to fund its operations and continue exploration in Zambia.

In addition, the Company's officers have agreed to defer a significant proportion of their cash compensation until sufficient capital has been raised to continue its operations. Effective October 1, 2008, the executive officers entered into salary deferral agreements for 40% of their compensation. Management plans to continue its efforts towards reducing administrative costs. However, without any additional funding, the Company may not be able to fund its operations through the end of its 2010 fiscal year.

Management is exploring various sources of additional capital including additional equity funding and joint venture participations. The weak US global economy combined with instability in global financial and capital markets has currently limited the availability of this funding. If the disruption in the global financial and capital markets continues, equity financing may not be available to us on acceptable terms, if at all. Equity financing, if available, may result in substantial dilution to existing stockholders. If we are unable to fund future operations by way of financing, including public or private offerings of equity, our business, financial condition and results of operations will be adversely impacted.

Recent Accounting Pronouncements

The Company does not expect the adoption of any recent accounting pronouncements to have a significant impact on its financial position or results of operations.

Critical Accounting Policies and Estimates

Our management routinely makes judgments and estimates about the effect of matters that are inherently uncertain. As the number of variables and assumptions affecting the future resolution of the uncertainties increase, these judgments become even more subjective and complex. Although we believe that our estimates and assumptions are reasonable, actual results may differ significantly from these estimates. Changes in estimates and assumptions based upon actual results may have a material impact on our results of operations and/or financial condition. We have identified certain accounting policies that we believe are most important to the portrayal of our current financial condition and results of operations.

Foreign Currency Translation

While the Company's functional currency is the US dollar, the local currency is the functional currency of the Company's subsidiary. The assets and liabilities are exposed to exchange rate fluctuations. The Company has adopted ASC 830 "Foreign Currency Translation". Assets and liabilities of the Company's foreign operations are translated into US dollars at the year-end exchange rates, and revenue and expenses are translated at the average exchange rates during the period. Exchange differences arising on translation are disclosed as a separate component of shareholders equity. Realized gains and losses from foreign currency transactions are reflected in the results of operations.

Accounting for Stock Options Granted to Employees and Non-Employees

For the fiscal year ended March 31, 2005, the company adopted FASB ASC 718, "Share-Based Payment" which requires the fair value of share-based payments, including grants of employee stock options to be recognized in the statement of operations based on their fair values.

The Company uses the Black-Scholes pricing model as a method for determining the estimated fair value for employee stock awards under ASC 718. The expected term of the options is based upon evaluation of historic and expected future exercise behavior. The risk-free interest rate is based upon US Treasury rates at the date of grant with maturity dates approximately equal to the expected life of the grant. Volatility is based upon historical volatility of the Company's stock. The Company has not historically issued any dividends and it does not expect to in the future.

Impairment of Long-Lived Assets

Since inception, the Company recorded impairment of $1,524,395. See Note 4 to the consolidated financial statements.