Silver Bear Announces 2010 First Quarter Results
TORONTO, May 4 /CNW/ - Silver Bear Resources Inc. ("Silver Bear" or the "Company") (TSX:SBR) today announces financial results for the quarter ended March 31, 2010, prepared in accordance with Canadian generally accepted accounting principles ("GAAP"). All dollar amounts are stated in Canadian dollars unless otherwise indicated.
As Silver Bear continues its review of strategic alternatives, the Company is focused on maintaining the Mangazeisky license in good standing and preserving its cash balance, both of which are viewed as significant assets of the Company. In accordance with the terms of its exploration license, Silver Bear has fulfilled its drilling and trenching requirements for 2010 on a cumulative basis through work completed in 2009. Through the end of 2009 and into the first quarter of 2010, Silver Bear has successfully reduced exploration as well as general and administrative expenditures when compared to prior quarters. As a result, the Company's cash balance at March 31, 2010 was $11.7 million compared to $12.3 million at December 31, 2009.
"The combined value of our Mangazeisky property, our cash balance and our experienced management team position us well as we carefully evaluate the next step for Silver Bear," said Randall Oliphant, President and Chief Executive Officer. "Our focus continues to be on maximizing the value of each of these assets in order to provide a meaningful return for our shareholders."
Financial Results
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Net Loss
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Silver Bear incurred a net loss for the period ended March 31, 2010 of $1.2 million, or $0.03 per share. This compares to a loss of $4.0 million or $0.11 per share for the period ended March 31, 2009. Exploration costs were $0.6 million in the period ended March 31, 2010 compared with $2.6 million in the period ended March 31, 2009, as the Company's focus in 2010 is on assessing and establishing targets for future exploration programs. General and administrative expenses for the period ended March 31, 2010 were $0.4 million compared with $0.7 million in the prior period as the Company reduced corporate office and salary related costs. Non-cash items for the period ended March 31, 2010 were $0.2 million compared with $0.7 million in the period ended March 31, 2009. Interest income for the period ended March 31, 2010 was $nil compared with $0.1 million in the prior period.
Liquidity and Capital Resources
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At March 31, 2010, Silver Bear had cash and cash equivalents of $11.7 million. The Company has no debt outstanding.
Mangazeisky Project
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During 2009, Silver Bear drilled a total of 12,373 metres over 74 holes. In addition, trenching activities resulted in 15,067 cubic metres being completed. Including these 2009 drilling and trenching results, on a cumulative basis, the Company has exceeded its license requirements through the end of 2010. 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 anticipates that the mineralized zone would be mined by selective underground methods at a minimum mining width of 1.2 metres.
Silver Bear Resources Inc.
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The primary business of the Company is the evaluation, acquisition, exploration and development of precious metal properties. 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 Mangazeisky 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. These may include: continued exploration/development of the Mangazeisky Project, joint venture of the Project, sale 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)
March 31, December 31,
2010 2009
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Assets
Current assets
Cash and cash equivalents 11,691,153 12,320,095
Other receivable 63,037 355,438
Inventories 1,212,613 1,226,195
Prepaid expenses 71,554 90,677
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13,038,357 13,992,405
Capital assets
Mineral property 1,265,117 1,265,117
Property, plant and equipment 1,780,857 1,969,181
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16,084,331 17,226,703
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Liabilities
Current liabilities
Accounts payable and accrued liabilities 322,257 352,298
Long-term liabilities
Asset retirement obligation 618,229 608,725
Shareholders' equity
Capital Stock 73,771,289 73,771,289
Contributed surplus 9,028,537 8,975,687
Deficit (67,655,981) (66,481,296)
------------ ------------
15,143,845 16,265,680
------------ ------------
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16,084,331 17,226,703
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Silver Bear Resources Inc.
(an exploration stage enterprise)
Consolidated Statements of Operations and Comprehensive Loss and Deficit
(Canadian dollars)
(unaudited)
Three-month periods ended
March 31, March 31,
------------ ------------
2010 2009
Income
Interest income 10,357 $ 56,445
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Expenses
Exploration costs 553,798 2,581,816
General and administrative 383,331 730,999
Stock option compensation 52,850 191,742
Amortization 188,324 180,319
Accretion expense 9,504 9,504
Gain on disposal of property, plant
and equipment (1,922) -
Foreign exchange loss (gain) (843) 347,931
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Expenses from operations 1,185,042 4,042,311
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Loss and Comprehensive Loss for the period (1,174,685) (3,985,866)
------------ ------------
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Deficit - Beginning of the period (66,481,296) (53,193,867)
------------ ------------
Deficit - End of the period (67,655,981) (57,179,733)
------------ ------------
------------ ------------
Weighted average number of common shares
outstanding 37,935,569 37,935,569
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Loss per share $ (0.03) $ (0.11)
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Silver Bear Resources Inc.
(an exploration stage enterprise)
Consolidated Statements of Cash Flows
(Canadian dollars)
(unaudited)
Three-month periods ended
March 31, March 31,
------------ ------------
2010 2009
Cash provided by (used in)
Operating activities
Loss from operations (1,174,685) (3,985,866)
Items not affecting cash:
Amortization 188,324 180,319
Accretion expense 9,504 9,504
Stock option compensation 52,850 191,742
Loss on disposal of property, plant and
equipment (1,922) -
Net change in non-cash working capital 295,065 (1,005,102)
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Net cash used in operations (630,864) (4,609,403)
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Investing activities
Acquisition of property, plant and equipment - (213,470)
Proceeds from sale of property, plant and
equipment 1,922 -
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1,922 (213,470)
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Decrease in cash and cash equivalents during
the period (628,942) (4,822,873)
Cash and cash equivalents - beginning of the
period 12,320,095 24,170,023
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Cash and cash equivalents - end of the period 11,691,153 19,347,150
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Forward-Looking Information
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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.
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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