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Re: News Release - Monday, March 09, 2009
Crowflight Announces Fourth Quarter And Year-End 2008 Financial
Results
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CROWFLIGHT MINERALS INC. (the "Company") (TSX: CML) today announced its
financial results for the fourth quarter and year-ended 2008. Complete
audited annual financial statements and related Management's Discussion
and Analysis have been filed under the Company's profile on
www.sedar.com. All amounts are in Canadian dollars unless otherwise
indicated.
Financial Highlights
- For the year ended December 31, 2008, Crowflight reported a net
income of $34.5 million or $0.13 per share compared to a net loss of
$4.5 million or ($0.02) per share for the year ended December 31, 2007.
The results for 2008 include a realized gain of $62.6 million on the
monetization of 89% of the nickel forward sales contracts. It also
includes a net unrealized gain on the change in value on the remaining
nickel forward sales and foreign exchange contracts of $8 million.
- Working capital was $7.6 million at December 31, 2008, including cash
and cash equivalents of $10.6 million, restricted cash of $3 million
and derivative assets of $8.7 million.
- The Company's total debt was reduced by $42.4 million in 2008 with a
restructured debt balance of $7.6 million as at December 31, 2008.
- Subsequent to year-end, the Company monetized all remaining nickel
forward sales and foreign exchange contracts for net proceeds of $10.1
million. Of this, $7.6 million was used to pay off the outstanding
balance of the debt facility plus accrued interest. As well, the
restriction on the debt reserve account was lifted, providing the
Company with cash of approximately $5.5 million. Crowflight is now
debt-free as a result of this transaction.
- In December, the Company completed a private placement financing
through the issuance of 23.6 million flow-through common shares at a
price of $0.18 per share for total gross proceeds of $4.4 million.
Operational Highlights for 2008
- Initial production was achieved at the Bucko Lake Nickel Mine (Bucko)
with a nickel concentrate being produced in December 2008. Subsequent
to year-end, the first nickel concentrate was shipped from Bucko and
completion of the Bucko Mine mill construction was announced in
February 2009
- The listing of Crowflight's common shares graduated to the Toronto
Stock Exchange (TSX) in December 2008.
- The Company secured a $55 million debt facility with favourable terms
required to complete development of Bucko in March, in addition to
raising $11 million in April and $4 million in December, despite
difficult financial markets.
- In March 2008, Crowflight was granted its license pursuant to the
Environment Act (Manitoba) from the province of Manitoba to commence
production at Bucko.
- The 2007 - 2008 winter drilling program resulted in expanded
resources for the satellite deposits near Bucko. Of particular note are
M11A, which saw a 197% increase in contained nickel, and Halfway Lake,
which increased by 46%. Two new zones of mineralization were also
discovered near the Manibridge property.
- Results from the Phase 1 underground delineation drilling at Bucko
are consistent with mine design tonnage and grade expectations.
Financial Results
For the three months ended December 31, 2008, the Company reported a
net income of $29 million or $0.11 per share, compared to a net loss of
$0.4 million or ($0.01) per share in the same period last year. The
results for 2008 include a realized gain of $62.6 million on the
monetization of 89% of the nickel forward sales contracts. It also
includes a net unrealized gain on the change in value on the remaining
nickel forward sales and foreign exchange contracts of $8.0 million.
For the year ended December 31, 2008 the Company reported a net income
of $34.5 million or $0.13 per share compared to a net loss of $4.5
million or ($0.02) per share for the year ended December 31, 2007.
Cash provided by operations for the quarter ended December 31, 2008 was
$61.8 million compared to cash provided by operations of $0.02 million
in the same period last year. The quarter ended December 31, 2008
includes predominantly general corporate and office charges and a
realized gain of $62.6 million on the monetization of derivative
contracts. For the year ended December 31, 2008, cash used by
operations was $59.2 million compared to $1.7 million last year.
The Company's total debt was reduced by $42.4 million in 2008 with a
restructured debt of $7.6 million as at December 31, 2008. Subsequent
to December 31, 2008, the Company monetized all remaining nickel
forward sales and foreign exchange contracts net proceeds of $10.1
million. Of this, $7.6 million was used to pay off the outstanding
balance of the debt facility plus accrued interest. As a result, the
Company has no outstanding debt.
Working capital was $7.6 million at December 31, 2008, including cash
and cash equivalents of $10.6 million and derivative assets of $8.7
million.
Outlook
Having produced and shipped the first nickel concentrates from Bucko
subsequent to the year's end, management intends to focus on the
following strategic initiatives in 2009, including:
- Continuing to ramp up to full commercial production, which management
expects to achieve early in the second quarter of 2009
- Continued development of the main underground ramp to connect surface
with the 1,000 foot level
- Reaching production targets of 9.1 million pounds of payable nickel
at average operating cash cost of US$3.61 per pound nickel
- Sustaining capital of US$10 million
- Continue to explore value enhancement opportunities for Crowflight
shareholders
- Continue to optimize operational and economic aspects of the
operation
Qualified Person/Quality Control Procedures
The scientific and technical information in this press release has been
reviewed by Mr. Paul Keller, P.Eng. and COO of Crowflight and Mr. Greg
Collins, P.Geo. and VP Exploration of Crowflight, both of whom are
Qualified Persons under the National Instrument 43-101 guidelines.
Crowflight Minerals -- Canada's Newest Nickel Producer
Crowflight Minerals Inc. (TSX: CML) is a Canadian junior mining company
that is producing nickel at the Bucko Lake Nickel Mine near Wabowden,
Manitoba. Full commercial production is expected to be achieved at
Bucko early in the second quarter of 2009. The Company is also focused
on nickel, copper and Platinum Group Mineral (PGM) projects in the
Thompson Nickel Belt and Sudbury Basin.
Cautionary Note on Forward-Looking Information
Except for statements of historical fact relating to Crowflight,
certain information contained herein constitutes forward-looking
information. Forward-looking information includes, but is not limited
to, statements with respect to the development potential of the
Company's properties; the future price of nickel and other minerals;
the estimation of mineral reserves and mineral resources; conclusions
of economic evaluation; the realization of mineral reserve estimates;
the timing and amount of estimated future production; costs of
production; capital expenditures; success of exploration activities;
mining or processing issues; currency exchange rates; government
regulation of mining operations; and environmental risks. Generally,
forward-looking information can be identified by the use of
forward-looking terminology such as ''plans'', ''expects'' or ''does
not expect'', ''is expected'', ''budget'', ''scheduled'',
''estimates'', ''forecasts'', ''intends'', ''anticipates'' or ''does
not anticipate'', or ''believes'', or variations of such words and
phrases or statements that certain actions, events or results ''may'',
''could'', ''would'', ''might'' or ''will be taken'', ''occur'' or ''be
achieved''. Forward - looking information is based on the opinions and
estimates of management as of the date such statements are made.
Estimates regarding the anticipated timing, amount and cost of mining
at the Company's projects are based on assumptions underlying mineral
reserve and mineral resource estimates and the realization of such
estimates are set out herein. Capital and operating cost estimates are
based on extensive research of the Company, purchase orders placed by
the Company to date, recent estimates of construction and mining costs
and other factors that are set out herein. Production estimates are
based on mine plans and production schedules, which have been developed
by the Company's personnel and independent consultants. These estimates
are subject to known and unknown risks, uncertainties and other factors
that may cause the actual results, level of activity, performance or
achievements of Crowflight to be materially different from those
expressed or implied by such forward-looking information, including but
not limited to risks related to: unexpected events and delays during
construction, expansion and start-up; variations in mineral grade and
recovery rates; delay or failure to receive government approvals;
timing and availability of external financing on acceptable terms;
actual results of current exploration activities; changes in project
parameters as plans continue to be refined; future prices of gold and
other minerals; failure of plant, equipment or processes to operate as
anticipated; accidents, labour disputes and other risks of the mining
industry. Although management of the Company has attempted to identify
important factors that could cause actual results to differ materially
from those contained in forward-looking information, there may be other
factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such statements will prove to
be accurate, as actual results and future events could differ
materially from those anticipated in such statements. Accordingly,
readers should not place undue reliance on forward-looking information.
Further information is available on the Company's website at
www.crowflight.com or contact:
Mike Hoffman
President and CEO
Crowflight Minerals
Tel: (416) 861-2964
Heather Colpitts
Manager, Investor and Public Relations
Crowflight Minerals
Tel: (416) 861-5803
info@crowflight.com
CONSOLIDATED BALANCE SHEETS
As at December 31,
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2008
2007
ASSETS
Current
Cash and cash equivalents $ 10,607,543 $
9,004,788
Restricted cash 2,999,998
-
Amounts receivable 607,125
1,281,466
Inventory 268,285
-
Prepaid expenses and deposits 138,463
276,164
Derivative asset 8,668,392
-
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23,289,806
10,562,418
Deposits and advances 536,709
952,263
Equipment 109,241
102,769
Exploration and development property, plant
and equipment and deferred expenditures 153,939,715
76,596,884
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$ 177,875,471 $
88,214,334
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LIABILITIES
Current
Accounts payable and accrued liabilities $ 14,950,385 $
8,465,682
Equipment leases 48,129
188,856
Derivative liability 624,223
-
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15,622,737
8,654,538
Equipment leases 107,286
Long term debt 7,600,000
-
Asset retirement obligations 359,000
331,000
Future income tax liability 24,139,000
2,490,000
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47,828,023
11,475,538
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SHAREHOLDERS' EQUITY
Common shares 99,289,864
86,671,512
Warrants 4,944,374
2,025,712
Contributed surplus 13,485,751
10,193,512
Retained Earnings/(Deficit) 12,327,459
(22,151,940)
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130,047,448
76,738,796
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$ 177,875,471 $
88,214,334
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These financials should be read in conjunction with the Notes and
Management's Discussion and Analysis, available online at www.sedar.com
and on the Company's website at www.crowflight.com
Consolidated Statements of Shareholders' Equity
Common Shares
Warrants
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No. $
$
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Balance, December 31, 2006 198,518,056 58,437,271
1,773,748
Private placement 28,125,000 25,000,000
-
Value of warrants granted on private
placement - (1,359,375)
1,359,375
Exercise of warrants and broker
warrants 20,192,931 8,372,749
-
Valuation allocation on exercise
of warrants - 1,548,505
(1,548,505)
Exercise of stock options 1,117,500 325,788
-
Valuation allocation on exercise
of stock options - 281,731
-
Shares issued for property acquisition 2,025,000 1,896,500
-
Expiry of warrants - -
(106,500)
Stock based compensation - -
-
Flow through share tax effect - (5,782,788)
-
Value of broker warrants - (547,594)
547,594
Share issue costs - (1,501,275)
-
Loss for the period - -
-
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Balance, December 31, 2007 249,978,487 86,671,512
2,025,712
Private placement 39,680,000 15,251,000
-
Value of warrants granted related
to debt facility - -
3,719,479
Value of warrants to be granted - -
849,709
Exercise of warrants and broker
warrants 1,115,836 446,334
-
Valuation allocation on exercise
of warrants - 118,742
(118,742)
Exercise of stock options 2,530,000 569,531
-
Valuation allocation on exercise
of stock options - 979,566
-
Stock based compensation - -
-
Flow through share tax effect - (3,563,000)
-
Value of broker warrants - (375,186)
375,186
Valuation allocation on expiry of
warrants and broker warrants - -
(1,906,970)
Share issue costs - (1,198,635)
-
Tax effect of cost of issue - 390,000
-
Income for the period - -
-
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Balance, December 31, 2008 293,304,323 99,289,864
4,944,374
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Contributed Accumulated
Shareholders'
Surplus Deficit
Equity
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$ $
$
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Balance, December 31, 2006 6,328,590 (17,686,671)
48,852,938
Private placement - -
25,000,000
Value of warrants granted on private
placement - -
-
Exercise of warrants and broker
warrants - -
8,372,749
Valuation allocation on exercise
of warrants - -
-
Exercise of stock options - -
325,788
Valuation allocation on exercise
of stock options (281,731) -
-
Shares issued for property
acquisition - -
1,896,500
Expiry of warrants 106,500 -
-
Stock based compensation 4,040,153 -
4,040,153
Flow through share tax effect - -
(5,782,788)
Value of broker warrants - -
-
Share issue costs - -
(1,501,275)
Loss for the period - (4,465,269)
(4,465,269)
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Balance, December 31, 2007 10,193,512 (22,151,940)
76,738,796
Private placement - -
15,251,000
Value of warrants granted related
to debt facility - -
3,719,479
Value of warrants to be granted - -
849,709
Exercise of warrants and broker
warrants - -
446,334
Valuation allocation on exercise
of warrants - -
-
Exercise of stock options - -
569,531
Valuation allocation on exercise
of stock options (979,566) -
-
Stock based compensation 2,364,835 -
2,364,835
Flow through share tax effect - -
(3,563,000)
Value of broker warrants - -
-
Valuation allocation on expiry
of warrants and broker warrants 1,906,970 -
-
Share issue costs - -
(1,198,635)
Tax effect of cost of issue - -
390,000
Income for the period - 34,479,399
34,479,399
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Balance, December 31, 2008 13,485,751 12,327,459
130,047,448
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These financials should be read in conjunction with the Notes and
Management's Discussion and Analysis, available online at www.sedar.com
and on the Company's website at www.crowflight.com
CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT
For the years ended December 31,
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2008
2007
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Expenses
Professional, consulting and management fees $ 3,194,231 $
5,263,846
Shareholder communications and investor
relations 439,525
349,519
General and office 410,509
265,345
Travel 169,088
151,667
Interest expenses and bank charges 11,495
162,799
Amortization 6,816
4,278
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4,231,664
6,197,454
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(Loss) before the undernoted (4,231,664)
(6,197,454)
Interest income 253,448
909,397
Interest and accretion on long term debt (2,317,355)
-
General exploration (106,921)
-
Write off of exploration property and
deferred expenditures (5,244,395)
(900,000)
Accretion expense (28,000)
-
Debt facility expenses (5,993,883)
-
Realized gain on monetization of derivative
instruments 62,580,000
-
Change in value of derivative instruments 8,044,169
-
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Income/(loss) before income taxes 52,955,399
(6,188,057)
Future income taxes (18,476,000)
1,722,788
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Income/(loss) for the year 34,479,399
(4,465,269)
DEFICIT, beginning of year (22,151,940)
(17,686,671)
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RETAINED EARNINGS/DEFICIT, end of year $ 12,327,459 $
(22,151,940)
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Earnings/(loss) per share - basic $ 0.13 $
(0.02)
Earnings/(loss) per share - diluted $ 0.13 $
(0.02)
Weighted average number of shares - basic 264,303,511
232,201,984
Weighted average number of shares - diluted 267,145,855
232,201,984
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These financials should be read in conjunction with the Notes and
Management's Discussion and Analysis, available online at www.sedar.com
and on the Company's website at www.crowflight.com.
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31,
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2008
2007
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OPERATING ACTIVITIES:
Net income/(loss) for the period $ 34,479,399 $
(4,465,269)
Charges not affecting cash:
Amortization 6,816
4,278
Stock-based compensation expense 2,364,835
4,040,153
Debt facility expense and accretion 7,175,683
-
Accretion expense 28,000
-
Change in value of derivative instruments (8,044,169)
-
Write down of exploration property and
deferred expenditures 5,244,395
900,000
Future income tax expense 18,476,000
(1,722,788)
Net change in non-cash working capital (498,933)
(460,904)
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59,232,026
(1,704,530)
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FINANCING ACTIVITIES:
Debt facility, net of transaction costs and
other fees 47,612,059
-
Retirement of debt facility (42,400,000)
-
Common shares issued through private
placements 14,052,365
21,411,350
Warrants issued through private placements -
1,359,375
Shares issued from exercise of warrants and
options 1,015,865
8,698,537
Payments on equipment leases (74,444)
-
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20,205,845
31,469,262
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INVESTING ACTIVITIES:
Exploration and development property, plant
and equipment, and deferred expenditures (82,559,511)
(39,898,563)
(Increase) decrease in deposits and advances 318,554
(205,768)
Increase in accounts payable attributable to
property development and exploration 7,405,839
5,613,649
Increase in restricted cash (2,999,998)
-
Equipment -
(70,182)
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(77,835,116)
(34,560,864)
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CHANGE IN CASH AND CASH EQUIVALENTS $ 1,602,755 $
(4,796,132)
CASH AND CASH EQUIVALENTS, beginning of year $ 9,004,788 $
13,800,920
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CASH AND CASH EQUIVALENTS, end of year $ 10,607,543 $
9,004,788
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These financials should be read in conjunction with the Notes and
Management's Discussion and Analysis, available online at www.sedar.com
and on the Company's website at www.crowflight.com
View News Release in PDF Format:
Associated File:
http://www.crowflight.com/i/pdf/2009-03-09_NR.pdf
259 KB in size, approx. 49 seconds to download at 56.6Kbps
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Copyright (c) 2009 CROWFLIGHT MINERALS INC. (CML) All rights reserved.
For more information visit our website at http://www.crowflight.com/
or send mailto:info@crowflight.com
Message sent on Tue Mar 10, 2009 at 6:59:53 AM Pacific Time
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