Sprott Resource Corp. Announces Second Quarter 2009 Results



    TORONTO, Aug. 13 /CNW/ - (TSX: SCP) - Sprott Resource Corp. ("SRC" or the
"Company") today announced its financial results for the three-and six-month
periods ended June 30, 2009. The consolidated financial statements and related
management's discussion and analysis can be found on SEDAR (www.sedar.com) and
www.sprottresource.com.

    
    Financial Highlights for Q2 2009 and Year to Date ("YTD") 2009:

    Consolidated Income Statements
    -------------------------------------------------------------------------
                       Three Month   Three Month     Six Month     Six Month
                      Period Ended  Period Ended  Period Ended  Period Ended
                     June 30, 2009 June 30, 2008 June 30, 2009 June 30, 2008
    -------------------------------------------------------------------------
    Net earnings
     (loss) ($000's)           490         6,959          (681)        6,683
    Earnings (loss)
     per share - basic        0.01          0.13         (0.01)         0.13
    Earnings (loss)
     per share - diluted      0.01          0.11         (0.01)         0.12
    -------------------------------------------------------------------------


    Consolidated Balance Sheets
    -------------------------------------------------------------------------
                                                              As at
                                                       June 30,      Dec. 31,
                                                          2009          2008
                                                        $000's        $000's
    -------------------------------------------------------------------------
    Cash, cash equivalents and short-term
     investments                                      $172,008      $203,547
    Gold & silver bullion (at cost)                    $61,930       $61,930
    Portfolio investments                              $40,665       $28,564
    Total Assets                                      $301,547      $314,286

    Current liabilities                                 $3,189       $21,946
    Total Liabilities                                  $10,199       $29,530
    Net assets (total assets minus total
     liabilities)                                     $291,348      $284,756
    Net assets/share                                     $3.55         $3.48
    -------------------------------------------------------------------------


    Operational Highlights for Q2 2009 and YTD:

    -   Investment portfolio grew to $40.7 million compared to $28.6 million
        at December 31, 2008. Growth was the result of net invested capital
        of $5.5 million and $6.6 million unrealized gains in the market value
        of the investments.
    -   One Earth Farms seeded 12,000 acres of crops at three First Nations
        farms in Saskatchewan, consisting of 2/3 canola and 1/3 wheat and
        barley. The fall harvest should begin in September and grain sales
        thereafter.
    -   Waseca Energy's oil revenues (net of royalties) grew by 154% to
        $753 thousand from $296 thousand in the first quarter of 2009.
    

    "We believe that the global economy will deteriorate further but will
also be subject to extreme volatility. The Company's strong cash balance
securely positions us to take advantage of this period of prolonged economic
weakness. As well, we aim to build value for our shareholders by focusing on
long-term supply/demand trends within the resource sector and on building,
financing and supporting our current subsidiaries," said Kevin Bambrough,
President and CEO of Sprott Resource Corp. "Since our overall economic outlook
remains bearish, we will continue to maintain a conservative investment
approach and seek to capitalize on pockets of strength."

    
    Financial Review

    Working Capital
    

    As at June 30, 2009, the Company had current assets of $240.8 million,
consisting primarily of cash and cash equivalents ($73.5 million), Government
of Canada T-bills ($98.5 million) and gold and silver bullion ($61.9 million).
Current liabilities of $3.2 million consist of accounts payable and accrued
liabilities ($3.0 million) and capital tax payable ($230 thousand).
    Working capital decreased to $237.6 million from $246.2 million at
December 31, 2008. The decrease in working capital is a result of net
purchases of public securities, the purchase of property, plant and equipment
and operating losses at One Earth Farms and Waseca.

    Net Assets

    As at the end of Q2 2009, net assets increased to $291.3 million from
$139.1 million at the end of Q2 2008 and from $284.8 million at the end of
December 31, 2008. Net assets per share were $3.55 at June 30, 2009.

    Net Revenue

    Waseca's oil sales are currently the Company's only operating revenue.
Net revenue for Q2 2009 was $753 thousand compared to nil in Q2 2008. 2009 YTD
net revenue was $1.0 million compared to nil for the same period in the prior
year.

    Operating Expenses

    Operating expenses, including general and administrative expenses,
management fees, and incentive fees, for Q2 2009 increased to $4.0 million
from $1.7 million in Q2 2008. Operating expenses increased to $7.2 million for
the 2009 YTD period from $2.4 million in the prior year period. The increase
in operating expenses is primarily related to the consolidation of Waseca and
One Earth Farms and their expanding operations.
    As at June 30, 2009, the Company had 82,007,224 common shares issued and
outstanding.

    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, info@sprottresource.com

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Sprott Resource Corp.

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