Wescan Goldfields Inc. announces second quarter results



    Stock Symbol: WGF: TSX-V

    SASKATOON, Aug. 26 /CNW/ - Wescan Goldfields Inc. ("Wescan"or the
"Company") reports the unaudited results of Wescan's operations for the
quarter ended June 30, 2008 have been filed and may be viewed at
www.sedar.com. A summary of key financial and operating results for the
quarter follows:

    
    Highlights

    -   "Letters of Comfort" received from the Saskatchewan Ministry of
        Energy and Resources on an extensive package of coal dispositions
        applied for in east central Saskatchewan.
    -   Wescan and Alto Ventures Ltd. ("Alto) approve $300,000 exploration
        program and budget.
    -   Issued and outstanding shares of 63,045,892 at June 30, 2008.
    

    Applications for Coal Dispositions

    In the second quarter of 2008, Wescan applied for an extensive package of
coal dispositions in the east central area of Saskatchewan. Coal permit
applications covering approximately 253,000 hectares were submitted in
accordance with the Coal Disposition Act of Saskatchewan, immediately
following the announcement of a significant coal discovery in that region by
Goldsource Mines Inc. ("Goldsource") (see Goldsource news release dated April
22, 2008). The near surface intersections discovered by Goldsource were made
in two holes spaced 1.64 kilometres apart in an area 50 kilometres north of
Hudson Bay, Saskatchewan.
    In May of 2008, Wescan announced receipt of "Letters of Comfort" from the
Saskatchewan Ministry of Energy and Resources stating that the majority of all
coal permit applications made on behalf of the Company are "first in line" and
would be given priority sequence. At that time, Wescan's priority sequenced
coal permit applications totaled 253,000 hectares (2,530 square kilometres)
located adjacent to and partially surrounding the coal discovered by
Goldsource. The criteria for targeting the coal permit applications were:
proximity to the recent coal discovery made by Goldsource; regional extent of
the Cretaceous Mannville Group; and glacial overburden thickness.
    Subsequent to the end of the period, Wescan announced it had received an
initial package of 83 coal permit certificates from the Saskatchewan Ministry
of Energy and Resources. The area covered by these initial permits is
approximately 60,080 hectares (601 square kilometres) and is located west of
the major coal discovery previously announced by Goldsource (see Goldsource
news releases dated April 22 and April 28, 2008). These permits allow Wescan
to explore the area for coal and cover a period of one year with two possible
six-month extensions and convertible to a 15-year lease. The Company has a
balance of 268 priority sequenced ("first in line") coal applications listed
in Letters of Comfort in the Hudson Bay, Saskatchewan area from the
Saskatchewan Ministry of Energy and Resources, comprising 192,640 hectares
(1,936 square kilometres) remaining to be issued. Exploration permitting with
Saskatchewan Environment is in progress with an initial program proposal
submitted to that department. This primary drilling will focus on Wescan's
southeasterly permits, located adjacent to Goldsource and proximal to their
recent drilling activity.

    Mud Lake Option Agreement

    In the second quarter of 2008, Wescan and Alto announced that a $300,000
exploration program and budget was approved for the Wescan-Alto Mud Lake
project in the Beardmore-Geraldton Gold Belt of northern Ontario. The program
includes an airborne high-resolution magnetometer and XDS/VLF electromagnetic
surveys as well as surface work consisting of prospecting, mechanical
stripping and sampling. The geophysical work was completed in late June and
the survey report is still pending. The surface work commenced in early July
and will be followed by diamond drilling scheduled to start in late September.

    Quarter End Results

    As at June 30, 2008, Wescan's cash and cash equivalents balance totaled
$270,462. The Company recorded a net loss of $545,313 ($0.01 per share)
compared to a net loss of $325,564 ($0.01 per share) for the same period in
2008. The Company's major source of income is the result of investing excess
cash reserves in short-term deposits. For the quarter ending June 30, 2008,
the Company reported interest and other income of $16,280 as compared to
$52,733 for the quarter ending June 30, 2008.
    Total operating costs for the quarter ended June 30, 2008 equaled
$670,593 compared to $485,650 for the quarter ended June 30, 2007. This
represents an increase of $184,943 and is the result of increases in
administration expenses and amortization and decreases in consulting and
professional fees. Administration expense increased from $382,463 in the
second quarter of 2007 to $615,762 for the quarter ended June 30, 2008. The
$233,299 increase is predominately related to increases in personnel costs and
stock based compensation during the second quarter of 2008 compared to 2007.
Consulting fees were $6,027 during the second quarter of 2008 compared to
$21,818 for the same period in 2007. The higher amount in 2007 was a result of
costs incurred from an executive search company. Finally, professional fees
decreased from $56,703 for the second quarter of 2007 to $18,569 for the
corresponding quarter in 2008. The decrease in expense was primarily related
to professional fees associated with due diligence on a certain mineral
property opportunity.

    Year to Date Results

    For the six-month period ended June 30, 2008, the Company recorded a net
loss of $805,025 ($0.01 per share) compared to a net loss of $666,279
($0.01 per share) for the same period in 2007. The loss for the period ended
June 30, 2008 was reduced by non-cash income tax recoveries of $134,500
(2007 - $220,000). The income tax recovery is the result of the Company
recording certain tax pools to the extent a future income tax liability was
created upon the renunciation of flow-through expenditures. Without the income
tax recovery the loss for the six-month period would have been $939,525
(2007 - $886,279). The primary difference from 2007 to 2008 relates to
increased administration costs over the same period of 2007 predominately
resulting from the fair-value of stock options expensed during the period and
increased personnel costs.
    Total operating costs for the six-month period ended June 30, 2008
equaled $986,925 compared to $975,098 for the same period of 2007.
Administration expense increased $134,889 from $766,138 in the first six
months of 2007 to $901,027 for the first six months of 2008. The increase is
predominately related to an increase in personnel costs and stock based
compensation. Consulting fees decreased by $23,328 over the same period last
year and the decrease is the result of costs incurred to an executive search
company in 2007 that did not exist in 2008. Finally, professional fees
decreased from $119,509 for the period ended June 30, 2007 to $20,436 for the
corresponding period in 2008. The higher expense in the first two quarters of
2007 versus 2008 was primarily related to professional fees associated with
due diligence on a certain mineral property opportunity.

    
    Selected financial highlights include:
    -------------------------------------------------------------------------
                                                         As at         As at
                                                       June 30,  December 31,
    Consolidated Balance Sheets                           2008          2007
    -------------------------------------------------------------------------
    Current assets                                 $   937,210   $ 3,526,360
    -------------------------------------------------------------------------
    Capital and other assets                        10,611,829     8,440,082
    -------------------------------------------------------------------------
    Current liabilities                                720,122       528,085
    -------------------------------------------------------------------------
    Future income tax liability                        311,000        25,500
    -------------------------------------------------------------------------
    Share capital                                   12,320,662    12,698,522
    -------------------------------------------------------------------------
    Contributed surplus                              1,046,643       758,698
    -------------------------------------------------------------------------
    Deficit                                         (2,849,388)   (2,044,363)
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
                      Three months  Three months    Six months    Six months
    Consolidated             Ended         Ended         Ended         Ended
     Statements of         June 30,      June 30,      June 30,      June 30,
     Income (Loss)            2008          2007          2008          2007
    -------------------------------------------------------------------------
    Interest and
     Other Income      $    16,280   $    36,086   $    47,400   $    88,819
    -------------------------------------------------------------------------
    Operating Expenses     670,593       485,650       986,925       975,098
    -------------------------------------------------------------------------
    Loss for the period
     before other item    (654,313)     (449,564)     (939,525)     (886,279)
    -------------------------------------------------------------------------
    Net loss for the
     period               (545,313)     (325,564)     (805,025)     (666,279)
    -------------------------------------------------------------------------
    Loss per share           (0.01)        (0.01)        (0.01)        (0.01)
    -------------------------------------------------------------------------


    -------------------------------------------------------------------------
                      Three months  Three months    Six months    Six months
    Consolidated             Ended         Ended         Ended         Ended
     Statements of         June 30,      June 30,      June 30,      June 30,
     Cash Flows               2008          2007          2008          2007
    -------------------------------------------------------------------------
    Cash flows from
     operating
     activities        $  (413,115)  $  (363,152)  $  (533,130)  $  (634,544)
    -------------------------------------------------------------------------
    Cash flows from
     investing
     activities           (940,061)     (261,002)   (2,614,473)     (668,112)
    -------------------------------------------------------------------------
    Cash flows from
     financing
     activities              4,790             -         4,790             -
    -------------------------------------------------------------------------
    Decrease in cash
     and cash
     equivalents        (1,348,386)     (624,154)   (3,142,813)   (1,302,656)
    -------------------------------------------------------------------------
    Cash and cash
     equivalents-
     beginning of
     period              1,618,848     4,545,772     3,413,275     5,224,274
    -------------------------------------------------------------------------
    Cash and cash
     equivalents-
     end of period         270,462     3,921,618       270,462     3,921,618
    -------------------------------------------------------------------------
    

    Outlook

    As at August 22, 2008, the Company has $ 116,500 in cash and cash
equivalents that will partially be used to continue exploration programs on
the Jojay, Fork Lake and Mud Lake properties as well as the potential coal
dispositions, fund its 50% share of future exploration programs on the
Company's uranium property interests, and evaluate the potential for
acquisition of more mineral properties in Canada and internationally.
Management has determined that the Company will require additional financing
and believes it will have sufficient access to financial markets to continue
its planned objectives.

    Caution Regarding Forward-looking Information

    From time to time, Wescan makes written or oral forward-looking
statements within the meaning of certain securities laws, including the "safe
harbour" provisions of the Ontario Securities Act. Wescan may make such
statements in this MD&A, in other filings with Canadian regulators, in reports
to shareholders or in other communications. These forward-looking statements
include, among others, statements with respect to Wescan's objectives for the
ensuing year, our medium and long-term goals, and strategies to achieve those
objectives and goals, as well as statements with respect to our beliefs,
plans, objectives, expectations, anticipations, estimates and intentions. The
words "may," "could," "should," "would," "suspect," "outlook," "believe,"
"plan," "anticipate," "estimate," "expect," "intend," and words and
expressions of similar import are intended to identify forward-looking
statements. In particular, statements regarding Wescan's future operations,
future exploration and development activities or other development plans
contain forward-looking statements.
    All forward-looking statements and information are based on Wescan's
current beliefs as well as assumptions made by and information currently
available to Wescan concerning anticipated financial performance, business
prospects, strategies, regulatory developments, development plans,
exploration, development and mining activities and commitments. Although
management considers these assumptions to be reasonable based on information
currently available to it, they may prove to be incorrect.
    By their very nature, forward-looking statements involve inherent risks
and uncertainties, both general and specific, and risks exist that
predictions, forecasts, projections and other forward-looking statements will
not be achieved. We caution readers not to place undue reliance on these
statements as a number of important factors could cause the actual results to
differ materially from the beliefs, plans, objectives, expectations,
anticipations, estimates and intentions expressed in such forward-looking
statements. These factors include, but are not limited to, developments in
world gold markets, risks relating to fluctuations in the Canadian dollar and
other currencies relative to the US dollar, changes in exploration,
development or mining plans due to exploration results and changing budget
priorities of Wescan or its joint venture partners; the effects of competition
in the markets in which Wescan operates; the impact of changes in the laws and
regulations regulating mining exploration and development; judicial or
regulatory judgments and legal proceedings; operational and infrastructure
risks and the additional risks described in Wescan's most recently filed
annual and interim MD&A and Wescan's anticipation of and success in managing
the foregoing risks.
    Wescan cautions that the foregoing list of factors that may affect future
results is not exhaustive. When relying on our forward-looking statements to
make decisions with respect to Wescan, investors and others should carefully
consider the foregoing factors and other uncertainties and potential events.
Unless otherwise required by applicable securities laws, Wescan does not
undertake to update any written forward-looking statement that may be made
from time to time by Wescan or on our behalf.

    %SEDAR: 00021049E




For further information:

For further information: Mrs. Judy Stoeterau, President, 600 - 224 4th
Avenue South, Saskatoon, SK, S7K 5M5, PH: (306) 664-2422, FAX: (306) 667-3557;
OR Mr. Todd M. Grychowski, Chief Financial Officer, 600 - 224 4th Avenue
South, Saskatoon, SK, S7K 5M5, PH: (306) 664-2422, FAX: (306) 667-3557

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Wescan Goldfields Inc.

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