Sprott Resource Corp. Announces First Quarter 2009 Results



    - Appoints New Chief Financial Officer -

    TORONTO, May 14 /CNW/ - (TSX: SCP) - Sprott Resource Corp. ("SRC" or the
"Company") today announced its financial results for the three month period
ended March 31, 2009. The consolidated financial statements and related
management's discussion and analysis can be found on SEDAR (www.sedar.com) and
www.sprottresource.com.
    "Our current conservative posture has enabled us to keep SRC's net asset
value stable in an extremely volatile stock market," said Kevin Bambrough,
President and CEO of Sprott Resource Corp. "We continue to focus on building
exposure to and long-term value in our three main investment themes -
agriculture, energy and precious metals."

    
    Business Highlights for Q1 2009:

    -   On March 4th, SRC announced its intention to form One Earth Farms
        with an initial investment of $27.5 million. Since then, SRC has
        assembled an experienced project team and commenced seeding
        operations of approximately 15,000 acres of farmland for 2009.

    -   Waseca continued its land acquisition program in the Lloydminster
        area of Saskatchewan. Total investment during the period was
        approximately $940,000, resulting in the leasing of approximately
        3,535 hectares of crown and freehold lands. Waseca's total land
        position now stands at 7,249 hectares. Waseca continues to actively
        evaluate potential opportunities to acquire additional prospective
        land and production.

    -   Stonegate Agricom remains focused on the agricultural nutrient
        sector, and continues to advance the Mantaro Phosphate Project
        through both local and regional geological study. In the quarter,
        Stonegate Agricom conducted community relations, environmental and
        administrative work in order to satisfy the requirements for a
        Category I exploration permit. The permit was granted in April 2009.
        Stonegate Agricom intends to complete its proposed exploration
        program by the third quarter of 2009.

    -   The Company's investment portfolio grew to $34.2 million as at
        March 31, 2009 from $28.6 million as at December 31, 2008. The
        portfolio is comprised of $18.3 million (53%) public securities and
        $15.9 million (47%) in private company investments. The growth in the
        public securities was the result of both net additional invested
        capital of $4.9 million and an increase of $736 thousand in the
        market value of the portfolio.

    -   The Company continues to hold 40,475 ounces of gold bullion and
        1.8 million ounces of silver bullion, which had a fair market value
        of $76.2 million as at March 31, 2009, an increase of $8.1 million
        from the fair market value as at December 31, 2008 and an increase of
        $14.2 million from its cost amount.


    Financial Highlights for Q1 2009:

    -------------------------------------------------------------------------
    Consolidated Income Statements          For the three months ended
    -------------------------------------------------------------------------
                                       Mar. 31,       Dec. 31,       Mar. 31,
                                          2009           2008           2008
    -------------------------------------------------------------------------
    Net earnings (loss)            ($1,170,706)   $60,389,329      ($276,208)
    EPS (basic)                         ($0.01)         $0.72         ($0.01)
    EPS (fully diluted)                 ($0.01)         $0.72         ($0.01)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
    Consolidated Balance Sheets                             As at
    -------------------------------------------------------------------------
                                                Mar. 31, 2009  Dec. 31, 2008
    -------------------------------------------------------------------------
    Cash, cash equivalents and short-term
     investments                                 $176,244,457   $203,546,586
    Gold & silver bullion (at cost)               $61,930,413    $61,930,413
    Portfolio investments                         $34,205,951    $28,564,256
    Total Assets                                 $295,930,310   $314,285,599
    Total Liabilities                             $11,568,560    $29,529,309
    Net assets (total assets minus total
     liabilities)                                $284,361,749   $284,756,290
    Net assets/share                                    $3.48          $3.48
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

    The net loss for the first quarter of 2009 was $1.17 million or ($0.01)
per basic share compared to a net loss of $0.28 million or ($0.01) per basic
share during the first quarter of 2008. The increase in net loss was primarily
due to an increase in general and administrative costs, which includes the
consolidation of Waseca's financial results, and the equity pick-up from
Stonegate Agricom's financial results.
    General and administrative ("G&A") expenses for Q1 2009 increased to $3.2
million from $673,509 in Q1 2008 and decreased from $20.9 million in Q4 2008.
The year over year the increase is related to the increased management fee
payable or accrued to Sprott Consulting LP ("SCLP") as a result of the
increase in the Company's net asset value and to professional fees in managing
its subsidiaries including auditing, accounting, legal and tax services. The
decrease in G&A expenses from Q4 2008 is attributable primarily to the $17.5
million in Incentive Fee payable to SCLP during Q4 2008.
    For Q1 2009, the Company's portfolio investments increased to $34.2
million compared to $28.6 million for Q4 2008. The growth is the result of an
unrealized gain of $735,981 and $4.9 million of net capital invested in the
public securities portfolio.
    Working capital decreased during the first quarter 2009 to $238.8 million
from $246.2 million as at December 31, 2008. The decrease in working capital
is the result of the net purchase of portfolio investments and the purchase of
oil and gas properties and equipment for the Company's subsidiary, Waseca.
    The Company's net assets remained relatively constant, with net assets of
$284.4 million or $3.48 per share at March 31, 2009 compared to $284.8 million
or $3.48 per share at December 31, 2008.
    As at March 31, 2009, the Company had 81,807,229 common shares issued and
outstanding.

    SRC Appoints New Chief Financial Officer

    The Company appointed Steve Yuzpe, CFA, MBA to the position of Chief
Financial Officer replacing Steve Austin effective immediately. Mr. Yuzpe has
over 13 years of financial experience, including seven years as the CFO of
Points International Ltd., a TSX listed company. The Company would like to
thank Mr. Austin for his contribution over the last year.

    About Sprott Resource Corp.

    SRC is a Canadian based company, the primary purpose of which is to
invest, directly and indirectly, in natural resources. Through acquisitions,
joint ventures and other investments, SRC seeks to provide its shareholders
with exposure to the natural resource sector for the purposes of capital
appreciation and real wealth preservation. SRC is well positioned to draw upon
the considerable experience and expertise of both its Board of Directors and
Sprott Consulting Limited Partnership ("SCLP"), of which Sprott Asset
Management Inc. is the sole limited partner. Pursuant to a management services
agreement between SCLP and SRC, SCLP provides day-to-day business management
for SRC as well as other management and administrative services.

    Forward Looking Statements

    Certain statements contained herein may constitute "forward-looking
statements" under applicable securities laws. Some of the forward-looking
statements may be identified by words such as "expects", "anticipates",
"should", "believes", "plans", and similar expressions. These statements are
based on current estimates, factors and assumptions, including expectations
regarding the SRC's future strategy and business and the execution of its
existing plans. These statements involve known and unknown risk. No assurance
can be given that any events anticipated by the forward-looking statements
will occur. Actual results and future events could differ materially from
those expressed in, or implied by, the forward-looking statements. As a
result, readers are cautioned not to place undue reliance on these
forward-looking statements. These forward-looking statements are made as at
the date of this news release. SRC does not undertake any obligation to
publicly update or revise any of these forward-looking statements, except as
required by applicable securities laws.





For further information:

For further information: Steve Yuzpe, Chief Financial Officer, (416)
977-7333, syuzpe@sprottresource.com

Organization Profile

Sprott Resource Corp.

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890