Silver Bear Announces 2009 Year-End Results
TORONTO, March 11 /CNW/ - Silver Bear Resources Inc. ("Silver Bear" or the "Company") (TSX:SBR) today announces financial results for the year ended December 31, 2009, prepared in accordance with Canadian generally accepted accounting principles ("GAAP"). All dollar amounts are stated in Canadian dollars unless otherwise indicated. Highlights of the year include:
- Increased and upgraded the silver resource on the Mangazeisky property
- Indicated mineral resource of 1.0 million tonnes averaging 558
grams per tonne of silver totaling approximately 18 million ounces
- Inferred mineral resource of 1.5 million tonnes averaging 596 grams
per tonne of silver totaling approximately 29 million ounces
- Exceeded 2009 drilling and trenching requirements per the license
- At December 31, 2009, Silver Bear had cash and cash equivalents of
$12.3 million with no debt
As the Company has, on a cumulative basis, fulfilled its drilling and trenching requirements for 2010 through work completed in prior years, Silver Bear's focus in 2010 will include reviewing strategic alternatives for the Company to enhance shareholder returns. This may include: continued exploration/development of the Mangazeisky Project, joint venture of the Project, or combination with another mineral focused company. With $12.3 million in cash and no debt, Silver Bear's financial liquidity is a significant asset. The Company's evaluation will aim to maximize the return to shareholders on this cash.
"From an exploration perspective, 2009 was another positive year for Silver Bear as we were able to successfully expand our total resource by 50%. However, the market continues to be challenging for junior resource companies, and we will now carefully review the alternatives that are available to our Company," said Randall Oliphant, President and Chief Executive Officer. "Our cash position of over $12 million, no debt, and our experienced management team provide us with a significant advantage when evaluating the many opportunities that lie before us."
Financial Results
-----------------
Net Loss
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Silver Bear incurred a net loss for the year ended December 31, 2009 of $13.3 million or $0.35 per share. This compares to a loss of $17.7 million or $0.48 per share for the year ended December 31, 2008. Exploration costs were $8.5 million in the year ended December 31, 2009 compared with $14.1 million in the year ended December 31, 2008, as the Company benefited from an efficient winter road resupply, fuel price savings and reduced overhead. In addition, certain geological studies completed in 2008 were not required in 2009. Despite the reduction in exploration expenses, the Company was able to complete 12,373 metres of drilling and 15,067 cubic metres of trenching during 2009 compared to 12,945 metres of drilling and 22,633 cubic metres of trenching during 2008. General and administrative expenses for the year ended December 31, 2009 were $2.4 million compared with $4.5 million in the prior year period as the Company incurred certain non-recurring legal expenses during 2008 and was further able to reduce corporate office and salary related costs during 2009. Non-cash items for the year ended December 31, 2009 were $2.5 million, unchanged from the prior year period. Interest income for the year ended December 31, 2009 was $0.1 million compared with $0.8 million in the prior period.
Silver Bear incurred a net loss for the three-month period ended December 31, 2009 of $1.8 million or $0.04 per share. This compares to a loss of $4.0 million or $0.11 per share for the three-month period ended December 31, 2008. Exploration costs were $0.4 million in the three-month period ended December 31, 2009 compared with $2.2 million in the three-month period ended December 31, 2008 with the reduction primarily driven by the value-added tax refund the Company was able to collect in the fourth quarter of 2009 and certain geological study costs not being repeated in the fourth quarter of 2009. General and administrative expenses for the three-month period ended December 31, 2009 were $0.5 million compared with $1.2 million in the three month-period ended December 31, 2008 with the decrease a result of reduced legal fees in 2009. Non-cash items for the three-month period ended December 31, 2009 was $0.9 million compared with $0.7 million in the three-month period ended December 31, 2008.
Liquidity and Capital Resources
-------------------------------
At December 31, 2009, Silver Bear had cash and cash equivalents of $12.3 million. The Company has no debt outstanding.
Update - Mangazeisky Project
----------------------------
During the 2009 drilling season which began in May and ended in October, Silver Bear drilled a total of 12,373 metres over 74 holes. In addition, trenching activities resulted in 15,067 cubic metres being completed. Both the drilling and trenching significantly exceeded the 2009 license requirements of 3,000 metres and 10,000 metres of drilling and trenching, respectively. In November of 2009, Silver Bear announced an updated mineral resource estimate for the project which was completed by Wardrop Engineering, a Tetra Tech Company, ("Wardrop"). Wardrop estimated an indicated mineral resource of 1.0 million tonnes averaging 558 grams per tonne totaling approximately 18 million ounces of silver for the Vertikalny vein, with an additional inferred mineral resource of 1.5 million tonnes averaging 596 grams per tonne totaling approximately 29 million ounces of silver. The estimate, as of November 6, 2009, was based on a long term silver price of US$10.84 per ounce, a cut-off grade of 240 grams per tonne and anticipated that the mineralized zone would be mined by selective underground methods at a minimum mining width of 1.2 metres.
Silver Bear Resources Inc.
--------------------------
The primary business of the Company is the evaluation, acquisition, exploration and development of silver properties in the Russian Federation. The Company's principal asset is its 100% owned Mangazeisky Project, located approximately 400 kilometres north of Yakutsk in the Republic of Sakha, Yakutia in the Russian Federation. Silver Bear plans to spend approximately $2.0 million to complete assessment and reconnaissance work at Mangezeisky in 2010, in addition to approximately $1.9 million in corporate general and administrative costs.
Silver Bear is currently evaluating strategic alternatives available to the Company in an effort to maximize shareholder returns. This may include: continued exploration/development of the Mangazeisky Project, joint venture of the Project, or combination with another mineral focused company.
Silver Bear Resources Inc. is listed on the Toronto Stock Exchange and its common shares trade under the symbol "SBR". Silver Bear has 37,935,569 issued and outstanding common shares. Other information relating to Silver Bear is available on SEDAR at www.sedar.com as well as on the Company's web site at www.silverbearresources.com.
Silver Bear Resources Inc.
(an exploration stage enterprise)
Consolidated Balance Sheets
(Canadian dollars)
(unaudited)
December 31, December 31,
------------ ------------
2009 2008
Assets
Current assets
Cash and cash equivalents $ 12,320,095 $ 24,170,023
Other receivable 355,438 75,538
Inventories 1,226,195 1,142,408
Prepaid expenses 90,677 666,396
------------ ------------
13,992,405 26,054,365
Capital assets
Mineral properties 1,265,117 1,265,117
Property, plant and equipment 1,969,181 2,520,265
Asset held for sale - 944,150
------------ ------------
$ 17,226,703 $ 30,783,897
------------ ------------
------------ ------------
Liabilities
Current liabilities
Accounts payable and accrued liabilities $ 352,298 $ 1,013,888
Long-term liabilities
Asset retirement obligation 608,725 570,711
Shareholders' equity
Capital Stock 73,771,289 73,771,289
Contributed surplus 8,975,687 8,621,876
Deficit (66,481,296) (53,193,867)
------------ ------------
16,265,680 29,199,298
------------ ------------
------------ ------------
$ 17,226,703 $ 30,783,897
------------ ------------
------------ ------------
Silver Bear Resources Inc.
(an exploration stage enterprise)
Consolidated Statements of Operations and Comprehensive Loss and Deficit
(Canadian dollars)
(unaudited)
Three Months Ended Year Ended
December 31, December 31, December 31, December 31,
------------ ------------ ------------ ------------
2009 2008 2009 2008
Income
Interest income $ 11,119 $ 165,893 $ 99,759 $ 769,201
------------ ------------ ------------ ------------
Expenses
Exploration costs 396,126 2,278,641 8,545,160 14,129,938
General and
administrative 537,782 1,231,000 2,390,332 4,461,726
Stock option
compensation 28,776 491,457 353,811 1,513,216
Amortization 202,853 182,616 765,067 915,118
Accretion expense 9,500 8,529 38,014 19,905
Loss on disposal of
property, plant
and equipment 598,572 - 610,203 -
Foreign exchange
loss (gain) 84,565 12,300 684,601 (33,859)
------------ ------------ ------------ ------------
Expenses from
continued
operations 1,858,174 4,204,543 13,387,188 21,006,044
------------ ------------ ------------ ------------
Non-controlling
interest - - - (33,178)
Loss and Comprehensive
Loss for the year
from continued
operations (1,847,055) (4,038,650) (13,287,429) (20,203,665)
Discontinued
operations - - - 2,502,027
------------ ------------ ------------ ------------
Net Loss (1,847,055) (4,038,650) (13,287,429) (17,701,638)
------------ ------------ ------------ ------------
Deficit - Beginning
of the period (64,634,241) (49,155,217) (53,193,867) (35,492,229)
------------ ------------ ------------ ------------
Deficit - End of
the period $(66,481,296) $(53,193,867) $(66,481,296) $(53,193,867)
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
Weighted average
number of
common shares
outstanding 37,935,569 37,066,717 37,935,569 37,095,678
Income (loss)
per share from
continued
operations $ (0.04) $ (0.11) $ (0.35) $ (0.54)
Income (loss) per
share from
discontinued
operations - - - 0.07
------------ ------------ ------------ ------------
Loss per share $ (0.04) $ (0.11) $ (0.35) $ (0.48)
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
Silver Bear Resources Inc.
(an exploration stage enterprise)
Consolidated Statements of Cash Flows
(Canadian dollars)
(unaudited)
Three Months Ended Year Ended
December 31, December 31, December 31, December 31,
------------ ------------ ------------ ------------
2009 2008 2009 2008
Cash provided by
(used in)
Operating activities
Loss from Continuing
operations $ (1,847,055) $ (4,038,651) $(13,287,429) $(20,203,665)
Items not affecting
cash:
Amortization 202,853 182,616 765,067 915,118
Accretion expense 9,500 8,529 38,014 19,905
Stock option
compensation 28,776 491,457 353,811 1,513,216
Loss on disposal
of property,
plant and
equipment 598,572 - 610,203 -
Net change in
non-cash working
capital (169,032) (693,399) (414,500) 1,168,424
------------ ------------ ------------ ------------
Net cash from
continuing
operations (1,176,386) (4,049,448) (11,934,834) (16,587,002)
------------ ------------ ------------ ------------
Financing activities
Issuance of common
shares - - - 5,779,977
Non-controlling
interest - - - (127)
------------ ------------ ------------ ------------
- - - 5,779,850
------------ ------------ ------------ ------------
Investing
activities
Acquisition of
property, plant
and equipment (28,539) (449,900) (260,672) (3,505,387)
Proceeds of sale
of property,
plant and
equipment 345,578 - 345,578 -
------------ ------------ ------------ ------------
317,039 (449,900) 84,906 (3,505,387)
------------ ------------ ------------ ------------
Decrease in cash
and cash equivalents
during the period (859,347) (4,499,348) (11,849,928) (14,312,539)
Increase in cash
and cash equivalents
during the period
discontinued
operations - - - 8,186,981
Cash and cash
equivalents -
beginning of the
period 13,179,442 28,669,371 24,170,023 30,295,581
------------ ------------ ------------ ------------
Cash and cash
equivalents - end
of the period $ 12,320,095 $ 24,170,023 $ 12,320,095 $ 24,170,023
------------ ------------ ------------ ------------
------------ ------------ ------------ ------------
Forward-Looking Information
---------------------------
This release and subsequent oral statements made by and on behalf of the Company may contain forward-looking statements, which reflect management's expectations with respect to the proposed transaction. Wherever possible, words such as "intends", "expects", "scheduled", "estimates", "anticipates", "believes" and similar expressions or statements that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved, have been used to identify these forward-looking statements. Although the forward-looking statements contained in this release reflect management's current beliefs based upon information currently available to management and based upon what management believes to be reasonable assumptions, Silver Bear cannot be certain that actual results will be consistent with these forward-looking statements. A number of factors could cause events and achievements to differ materially from the results expressed or implied in the forward-looking statements. Such risks factors include but are not limited to risks factors identified by Silver Bear in its continuous disclosure filings filed from time to time on SEDAR. These factors should be considered carefully and prospective investors should not place undue reliance on the forward-looking statements. Forward-looking statements necessarily involve significant known and unknown risks, assumptions and uncertainties that may cause Silver Bear's actual results, events, prospects and opportunities to differ materially from those expressed or implied by such forward-looking statements. Although Silver Bear has attempted to identify important risks and factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors and risks that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, prospective investors should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date of this release, and Silver Bear assumes no obligation to update or revise them to reflect new events or circumstances, unless otherwise required by law.
Mr. P. Gribble, FIMMM C.Eng, Wardrop Engineering is the independent qualified person who estimated the mineral resource disclosed herein.
For further information: please visit www.silverbearresources.com, or contact: Brian Penny, Chief Financial Officer, (416) 324-6002, [email protected]; Hannes Portmann, Director, Corporate Development and Investor Relations, (416) 324-6014, [email protected]
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