And market value of GobiMin's shareholding in Loco HK of $31.9 million
(Expressed in United States dollars except where otherwise indicated)
TSX-V: GMN
TORONTO , Aug. 28, 2014 /CNW/ - (GMN.V) GobiMin Inc.("GobiMin" or the "Company") reports its financial and operating results
for the second quarter of 2014. The unaudited interim consolidated
financial statements along with management's discussion and analysis
have been filed with SEDAR (www.sedar.com) and are also available at
the website of the Company (www.gobimin.com).
Financial Highlights
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3 months ended June 30
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12 months ended
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2014
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2013
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December 31, 2013
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$
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$
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$
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Revenue
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-
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-
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-
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Other revenue
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0.2 million
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0.2 million
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1.5 million
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Additional gain on disposal of an associate
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4.0 million
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-
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-
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Share of results of associates and a joint venture
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(0.2 million)
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0.1 million
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0.3 million
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Profit (loss) for the period
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2.3 million
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(0.8 million)
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(3.6 million)
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EBITDA (LBITDA) (1) |
2.8 million
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(0.8 million)
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(4.2 million)
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Basic and diluted earnings (losses) per share
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0.042
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(0.012)
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(0.05)
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EBITDA (LBITDA) per share(1) |
0.048
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(0.014)
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(0.07)
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Cash and cash equivalents
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39.3 million
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32.6 million
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54.5 million
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Cash and cash equivalents per share(1) |
0.68
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0.55
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0.94
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Working capital
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38.1 million
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37.9 million
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39.7 million
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Total non-current financial liabilities
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1.8 million
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2.0 million
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4.5 million
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Total liabilities
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8.8 million
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35.1 million
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34.6 million
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Total assets
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93.9 million
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120.8 million
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118.3 million
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Note:
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(1)
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As non-IFRS measurements, EBITDA (LBITDA) (earnings (losses) before interest income and expense, income taxes,
depreciation and amortisation), EBITDA (LBITDA) per share and Cash and cash equivalents per share do not comply with IFRS and, therefore, the amounts presented in the
above table may not be comparable to similar data presented by other
companies. The data is intended to provide additional information and
should not be considered in isolation or as a substitute for measures
of performance prepared in accordance with IFRS.
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Business Summary and Development
The Company owns a 70% equity interest in a company which is developing
and operating the Sawayaerdun Gold Project (the "Gold Project") in
Xinjiang. The 2014 drilling program has commenced as scheduled in June
2014 after the setup of the drilling equipments for the program were
completed. The drilling of approximately 237 meters has been completed
in June 2014 . In view of the current market situation, GobiMin plans to
reduce the drilling program to approximately 6,500 meters for 2014.
Along with this, GobiMin will continue to pursue the major design
and/or construction of mine development, tailing ponds, camp facilities
and access roads but in less extent as planned before.
GobiMin held an equity interest of 48.02% in an associate, China
Precision Material Limited ("China Precision") which engages in metal
trading and processing, predominantly in silver. To prepare for the
listing on the Growth Enterprise Market of the Stock Exchange of Hong
Kong Limited ("GEM") in August 2014 , China Precision completed a
capital reorganisation and all the shares held by the shareholders of
China Precision were swapped for the shares of a newly incorporated
Hong Kong company, Loco Hong Kong Holdings Limited ("Loco HK"). Loco HK
completed a placement at $0.05 (HK$0.36) per share and raised gross
proceeds of approximately $6.0 million ( HK$43.2 million ). Concurrently,
Loco HK capitalized an amount of approximately $3.6 million ( HK$27.7
million ) due to the Group from China Precision by issuing new shares of
Loco HK at a price of $0.03 (HK$0.25) per share to the Group. All the
remaining outstanding balance due from China Precision to the Group
were then fully settled in cash. Accordingly, GobiMin through a wholly
owned subsidiary holds 192,080,000 shares of Loco HK, which represents
approximately 48.02% of its total issued shares. The dealings in the
shares of Loco HK on the GEM commenced on August 5, 2014 under the
stock code "8162". The market value of the shares of Loco HK held by
GobiMin is approximately $31.9 million ( HK$247.8 million ) as at August
28, 2014 .
The Group owns 40% equity interests each in three exploration companies
incorporated in Xinjiang, China for nickel, copper, and gold. They are
treated as associates of the Group. The net cost of the investment in
these three exploration companies amounted to $1.0 million ( RMB6.3
million ). The carrying value of these companies as at June 30, 2014 was
$0.7 million ( RMB4.0 million ). Exploration programs of the three
exploration companies will continue in 2014.
GobiMin held 3.5% equity interest in Xinjiang Tongxing Minerals Limited,
which is the licence holding company of the Yanxi Copper Property. In
respect of an area adjacent to the Yanxi Copper Property (the "New
Area"), the Group and the two local shareholders were entitled to an
additional consideration of $10.8 million (HK$84,160,440) , of which
$5.4 million ( HK$42.1 million ) was received in 2012 and the remaining
$5.4 million ( HK$42.1 million ) was received on June 30, 2014 . After
netting off the related payments and expenses of approximately $6.8
million including drilling work and costs in relation to the
application of the mining licence of the New Area and amount payable to
the local shareholders, the Group recognised a gain of approximately
$4.0 million for the New Area.
Liquidity and Capital Resources
As at June 30, 2014 , the Group had a working capital of about $38.1
million ( December 31, 2013 : $39.7 million ), by netting off its current
assets of $45.1 million ( December 31, 2013 : $69.7 million ) with current
liabilities of $7.0 million ( December 31, 2013 : $30.0 million ).
The Group has no difficulties in meeting obligations associated with its
financial liabilities and commitment. The Group has determined that its
cash and cash equivalents will be more than sufficient to finance its
operation, including the current commitments of the Gold Project of
approximately $6.8 million and the commitment for the capital
contributions to the exploration company in Xinjiang of $0.5 million
( RMB3.2 million ).
Certain statements contained in this press release constitute
forward-looking information. Such statements are based on the current
expectations of management of GobiMin. You are cautioned that such
statements are subject to a multitude of risks and uncertainties that
could cause actual results, future circumstances or events to differ
materially from those projected in the forward-looking information.
Forward looking information includes without limitation, statements
regarding the size and quality of the Company's mineral resources,
progress in development of mineral properties, the prospective
mineralization of the properties, and planned exploration programs.
The reader should not place undue reliance on the forward-looking
information included in this press release given that (i) actual
results could differ materially from a conclusion, forecast or
projection in the forward-looking information, and (ii) certain
material factors or assumptions were applied in drawing a conclusion or
making a forecast or projection as reflected in the forward-looking
information could prove to be inaccurate. These statements speak only
as of the date they are made, and GobiMin assumes no obligation to
revise such statements as a result of any event, circumstance or
otherwise, except in accordance with law.
"Neither TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange)
accepts responsibility for the adequacy or accuracy of this release."
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SOURCE GobiMin Inc.