Silver Bear Announces Second Quarter Results; Increases 2009 Drilling Program



    TORONTO, Aug. 13 /CNW/ - Silver Bear Resources Inc. ("Silver Bear" or the
"Company") (TSX:SBR) today announces financial results for the second quarter
ended June 30, 2009, prepared in accordance with Canadian generally accepted
accounting principles ("GAAP") and provides an update on the 2009 drilling
program. All dollar amounts are stated in Canadian dollars unless otherwise
indicated. Highlights of the second quarter include:

    
    -   At June 30, 2009, Silver Bear had cash and cash equivalents of
        $17.1 million, sufficient to meet drilling and trenching requirements
        under the License Agreement through 2010;

    -   The 2009 exploration drilling program commenced in May 2009 and is
        expected to be completed on October 1, 2009. The Company has already
        exceeded its target of 10,000 metres at less than budgeted costs and
        now plans to extend its 2009 drilling program to 12,000 metres;

    -   As of August 9, 2009, 65 holes covering 10,463 metres have been
        drilled and 4,772 cubic metres of trenching have been completed; and

    -   A total of 697 samples have been submitted for assay, with the first
        results expected in the third quarter of 2009.

    "Our 2009 exploration program is well under way, and we expect to update
our existing resource estimate during the first quarter of 2010," said Randall
Oliphant, President and Chief Executive Officer. "We are extremely pleased as
our team has exceeded our planned drilling target at less than budgeted costs,
thus allowing Silver Bear to increase our 2009 program."

    Financial Results
    -----------------

    Net Loss
    --------
    
    The Company is in the exploration stage and therefore did not generate
revenues from operations as at June 30, 2009. Silver Bear incurred a net loss
for the six-month period ended June 30, 2009 of $7.8 million, or $0.21 per
share. This compares to a loss of $5.3 million, or $0.15 per share, for the
period ended June 30, 2008. The 2008 loss for the period included a $2.5
million gain on the sale of the Company's Avlayakan property, partially
offsetting the operational losses. Exploration costs were $5.3 million in the
period ended June 30, 2009, compared with $4.6 million in the period ended
June 30, 2008, as the Company paid mobilization costs for drilling supplies
and equipment in the first quarter of 2009 that were not paid in 2008. Savings
in fuel prices and an efficient winter road supply have helped the Company
lower these costs in 2009. General and administrative expenses for the period
ended June 30, 2009 were $1.4 million, compared with $2.6 million in the prior
period. General and administrative costs are below prior year as the Company
has favourably settled previous litigation matters in the Russian Federation
as well as reduced travel in the first and second quarters of 2009 compared to
the same period of 2008.
    Silver Bear incurred a net loss for the three-month period ended June 30,
2009 of $3.8 million, or $0.10 per share. This compares to a loss of $2.4
million, or $0.07 per share, for the three-month period ended June 30, 2008.
The 2008 loss included a $2.5 million gain on the sale of the Company's
Avlayakan property. Exploration costs were $2.7 million in the three-month
period ended June 30, 2009 compared with $3.1 million in the three-month
period ended June 30, 2008, as savings on fuel and supplies purchased for the
drill season are now being realized. General and administrative expenses for
the three-month period ended June 30, 2009 were $0.7 million compared with
$1.4 million in the three-month period ended June 30, 2008. General and
administrative expenses for the three-month period decreased when compared to
the 2008 period for the same reasons as noted in the six-month explanation
above.

    
    Liquidity and Capital Resources
    -------------------------------
    At June 30, 2009, Silver Bear had cash and cash equivalents of $17.1
million, enough to meet drilling and trenching requirements under the License
Agreement through 2010. At December 31, 2008, cash and cash equivalents were
$24.2 million.

    Update - Mangazeisky Project
    ----------------------------
    
    Silver Bear's objective for 2009 is to significantly increase the
Company's mineral resource estimate. Silver Bear originally planned to
complete 10,000 metres of exploration drilling and 10,000 cubic metres of
surface trenching during the year, leaving the Company with sufficient cash to
fund further exploration in 2010. As a result of increased drilling
efficiencies, the Company has already completed over 10,000 metres of drilling
at well below budgeted costs; as such Silver Bear is extending its planned
drilling for 2009 to 12,000 metres. Total estimated cost for the 2009 program
remains approximately $12.0 million, of which $5.3 million has been spent as
at June 30, 2009. A mineral resource estimate dated March 6, 2009, based on
intersections from 73 drill holes and 13 trenches, determined an inferred
silver resource of 31.3 million ounces (1.9 tonnes at 508 grams per tonne
silver).
    Drilling activities commenced in May 2009, and as of August 9, 2009,
10,463 metres were drilled in 65 holes. Trenching activities resulted in 4,772
cubic metres being completed. Work has primarily concentrated on expanding the
2008 resource estimate by down-dip and along-strike drilling within the
Central and Northwest zones. A minor portion of the drilling has been
committed to undercutting trench data to improve the quality of the resource,
and for infill drilling for a Russian C1 reserve estimate.
    Vivian Park, Director of Exploration, a "qualified person" employed by
the Company under NI 43-101, has reviewed the technical information contained
in this news release.

    
    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 is focused on further delineating the high-grade silver
mineralization discovered in the Vertikalny vein of the Mangazeisky Project
and the exploration of the other known silver mineralized zones on the
property. Based on the encouraging results from the drilling program concluded
to date, Silver Bear believes the Mangazeisky Project has the potential to
become a world-class silver deposit.
    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 Sheet
    (Canadian dollars)
    (unaudited)
                                                      June 30,   December 31,
                                                         2009           2008
                                                 -------------  -------------
    Assets

    Current assets
    Cash and cash equivalents                    $ 17,076,808   $ 24,170,023
    Related party receivable                            4,137         23,063
    Inventories                                     1,815,312      1,142,408
    Prepaid expenses                                  549,650        666,396
    Miscellaneous receivables                          13,264         52,475
                                                 -------------  -------------

                                                   19,459,171     26,054,365

    Capital assets
    Mineral properties                              1,265,117      1,265,117
    Property, plant and equipment                   2,364,606      2,520,265
    Asset held for sale                               944,150        944,150

                                                 -------------  -------------
                                                 $ 24,033,044   $ 30,783,897
                                                 -------------  -------------
                                                 -------------  -------------

    Liabilities

    Current liabilities
    Accounts payable and accrued liabilities     $  1,691,012   $  1,013,888

    Long-term liabilities
    Asset retirement obligation                       589,717        570,711

    Shareholders' equity

    Capital Stock                                  73,771,289     73,771,289

    Contributed surplus                             8,967,290      8,621,876

    Deficit                                       (60,986,264)   (53,193,867)

                                                 -------------  -------------
                                                   21,752,315     29,199,297
                                                 -------------  -------------

                                                 -------------  -------------
                                                 $ 24,033,044   $ 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             Six months Ended
                              June 30,                      June 30,
                        2009           2008           2009           2008

    Income
      Interest
       income      $     17,389   $    179,766   $     73,834   $    465,393
                   -------------  -------------  -------------  -------------

    Expenses
      Exploration
       costs          2,686,238      3,059,013      5,268,054      4,644,360
      General and
       administrative   687,342      1,406,358      1,418,341      2,627,557
      Stock option
       compensation     153,673        304,353        345,415        729,456
      Amortization      194,267        245,649        374,586        537,391
      Accretion
       expense            9,505          3,982         19,006          7,582
      Loss on
       disposal of
       property,
       plant and
       equipment         11,631              -         11,631              -
      Foreign
       exchange
       loss (gain)       81,261        102,098        429,197       (197,653)
                   -------------  -------------  -------------  -------------
    Expenses from
     continuing
     operations       3,823,917      5,121,453      7,866,230      8,348,693
                   -------------  -------------  -------------  -------------

      Non-controlling
       interest               -         (5,345)             -        (33,178)

    Loss and
     Comprehensive
     Loss for the
     period from
     continuing
     operations      (3,806,528)    (4,936,342)    (7,792,396)    (7,850,122)

    Discontinued
     Operations               -      2,502,027              -      2,502,027

                   -------------  -------------  -------------  -------------
    Net Loss         (3,806,528)    (2,434,315)    (7,792,396)    (5,348,095)
                   -------------  -------------  -------------  -------------

    Deficit -
     Beginning of
     the period     (57,179,736)   (38,406,009)   (53,193,868)   (35,492,229)

                   -------------  -------------  -------------  -------------
    Deficit -
     End of the
     period        $(60,986,264)  $(40,840,324)  $(60,986,264)  $(40,840,324)
                   -------------  -------------  -------------  -------------
                   -------------  -------------  -------------  -------------


    Weighted average
     number of
     common shares
     outstanding     37,935,569     36,435,569     37,935,569     36,370,184

    Income (loss)
     per share from
     continuing
     operations    $      (0.10)  $      (0.14)  $      (0.21)  $      (0.22)
    Income (loss)
     per share from
     discontinued
     operations               -           0.07              -           0.07

                   -------------  -------------  -------------  -------------
    Income (loss)
     per share     $      (0.10)  $      (0.07)  $      (0.21)   $     (0.15)
                   -------------  -------------  -------------  -------------
                   -------------  -------------  -------------  -------------



    Silver Bear Resources Inc.
    (an exploration stage enterprise)
    Consolidated Statements of Cash Flows
    (Canadian dollars)
    (unaudited)

                        Three months Ended             Six months Ended
                              June 30,                      June 30,
                        2009           2008           2009           2008

    Cash provided by
     (used in)

    Operating
     activities
    Loss from
     Continuing
     operations    $ (3,806,528)  $ (4,936,342)  $ (7,792,396)  $ (7,850,122)


    Items not
     affecting
     cash:
      Amortization      194,267        245,649        374,586        537,391
      Accretion
       expense            9,505          3,982         19,006          7,582
      Stock option
       compensation     153,673        304,353        345,415        729,456
      Loss on disposal
       of property,
       plant and
       equipment         11,631                        11,631
    Net change in
     non-cash
     working
     capital          1,184,205      2,508,713        179,103      1,082,859

                   -------------  -------------  -------------  -------------
    Net cash from
     continuing
     operations      (2,253,247)    (1,873,645)    (6,862,655)    (5,492,834)
                   -------------  -------------  -------------  -------------

    Financing
     activities
    Issuance of
     common shares            -       (366,958)             -      1,560,013
    Deferred stock
     issuance costs           -       (214,456)             -       (214,456)
    Non-controlling
     interest                 -           (127)             -           (127)

                   -------------  -------------  -------------  -------------
                              -       (581,541)             -      1,345,430
                   -------------  -------------  -------------  -------------

    Investing
     activities
    Acquisition of
     property, plant
     and equipment      (17,093)    (1,686,319)      (230,560)    (2,248,113)

                   -------------  -------------  -------------  -------------
                        (17,093)    (1,686,319)      (230,560)    (2,248,113)
                   -------------  -------------  -------------  -------------

    Decrease in cash
     and cash
     equivalents
     during the
     period          (2,270,340)    (4,141,505)    (7,093,215)    (6,395,517)

    Decrease in cash
     and cash
     equivalents
     during the
     period from
     discontinued
     operations               -      8,368,058              -      8,186,979

    Cash and cash
     equivalents -
     beginning of
     the period      19,347,148     27,860,490     24,170,023     30,295,581

                   -------------  -------------  -------------  -------------
    Cash and cash
     equivalents -
     end of the
     period        $ 17,076,808   $ 32,087,043   $ 17,076,808   $ 32,087,043
                   -------------  -------------  -------------  -------------
                   -------------  -------------  -------------  -------------

    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.





For further information:

For further information: please visit www.silverbearresources.com, or
contact: Brian Penny, Chief Financial Officer, (416) 324-6002,
bpenny@silverbearresources.com; Hannes Portmann, Director, Corporate
Development and Investor Relations, (416) 324-6014,
hportmann@silverbearresources.com

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SILVER BEAR RESOURCES INC.

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