VANCOUVER, Nov. 9 /CNW/ - Polaris Minerals Corporation (TSX:PLS) today reported financial results for the quarter ended September 30, 2009. All financial results are in US Dollars unless otherwise noted.
Revenue was $4.52 million in the quarter, a decrease of 50% over the third quarter of 2008. Revenue for the first nine months of 2009 was $13.66 million, a decrease of 38% over the comparable 2008 period. At September 30, 2009, the Company had working capital of $11.2 million, including cash of $5.9 million, and no long term debt. The cash position was enhanced by $2.7 million during the quarter through the sale of the Company's asset backed commercial paper investment.
The net loss for the quarter was $5.23 million ($0.10 loss per share) compared with a net loss of $3.24 million ($0.09 loss per share) for the quarter ending September 30, 2008. For the first nine months of 2009, the Company had a net loss of $9.96 million ($0.19 loss per share) compared with a net loss of $7.63 million ($0.20 loss per share) in the comparable 2008 period. Underlying prices for the Company's products, net of fuel cost adjustments, remain stable. Because of the potential for liabilities from failing to meet minimum annual volume shipping commitments, the loss in the quarter was impacted by a provision of $1 million and an inventory write down of $592,000. This matter is presently the subject of negotiation between the parties. Further impacting net loss in the quarter was deadfreight charges of $366,000.
Herb Wilson, President and CEO, said: "Construction demand in all served markets declined further in the quarter as a consequence of continuing economic problems in the public and private sectors. In particular, the expected boost in infrastructure activity through stimulus spending in California was either neutralized by state budget deficiencies or delayed until 2010. In common with the California construction aggregate industry, we have experienced a 40% reduction in the demand for our products during the first nine months of 2009. We have reacted to these adverse economic circumstances by reducing the number of employees at Orca Quarry by one third, by curtailing selling, general and administrative expenses by 42.2% in the quarter, and by restricting capital expenditure. We have also taken action to eliminate future deadfreight costs through improved inventory planning and revised ship scheduling. We are currently negotiating the issue of potential contract liabilities with our shipping partner and are confident that a mutually acceptable solution will be found."
Mr. Wilson continued: "The Polaris business model is based upon the long term demand for the supply of imported construction aggregates to augment declining local resources in major cities along the western seaboard of the USA. Despite the severity of the current economic conditions, we expect that a change in the present cycle will be apparent in 2010 and accelerate thereafter. As a consequence, we have continued to pursue terminal developments, and are pleased to note two recent milestones in southern California that will assist in achieving our business plan. In the Port of Long Beach, we have entered into a nine month option to lease an existing marine aggregates terminal in the Port and have commenced due diligence. This site, which is permitted for 3 million tons per year throughput, offers the potential for an early and low cost entry into the greater Los Angeles market. At the successful conclusion of due diligence, the Company intends to proceed with the sale of the Pier B land acquired in 2008. In the Port of San Diego, an Exclusive Negotiating Agreement was entered into with the Port, providing exclusivity while negotiations proceed for a long-term lease of a terminal site. In recent speeches Governor Schwarzenegger announced that over $2 billion in Recovery Act funding has been federally obligated, $13.1 billion bond money from Proposition 1B (2006) is committed to 1,492 projects for high-priority transportation improvements, and an anticipated $4.7 billion is to be spent on high-speed rail projects. As a consequence of these firm indications by the State of California that it intends to create jobs by infrastructure construction, our main sector of interest, coupled with the Company's progress in terminal development, we remain cautiously optimistic for the short-term future and strongly committed to our long-term objectives."
This financial summary should be read in conjunction with the Company's September 30, 2009 Consolidated Financial Statements and Management's Discussion and Analysis, both of which are available on www.sedar.com as well as the Company's website at www.polarmin.com
The Company will host a conference call at 8 am PT on Tuesday, November 10, 2009. Investors and other interested parties may access the teleconference live by calling 1 416 915 5761 or 1 877 974 0469 in North America or internationally.
A live webcast of the conference call will be available through the link below: http://www.newswire.ca/en/webcast/viewEvent.cgi?eventID=2882660
The webcast will be archived for 90 days following the call.
The conference call will be recorded and available for replay at 10 am PT and will be available until November 24, 2009. To access the replay, dial 1 416 640 1917 or 1 877 289 8525. The access code to hear the recording is 4182015 followed by the pound sign.
Polaris Minerals Corporation is exclusively focused on the development of construction aggregate quarries and marine receiving terminals on the west coast of North America to meet growing local supply deficits of construction aggregates in urban markets. In 2007, Polaris began shipping sand and gravel from the Orca Quarry to San Francisco Bay, Vancouver, and Hawaii.
This press release contains "forward-looking statements" and "forward-looking information" within the meaning of applicable securities laws. These statements and information appear in this document and include estimates, forecasts, information and statements as to management's expectations with respect to, among other things the future financial or operating performance of the Company, costs and timing of the development of the construction aggregate quarry, the timing and amount of estimated future production, costs of production, capital and operating expenditures, requirements for additional capital, government regulation of quarrying operations, environmental risks, reclamation expenses, and title disputes. Often, but not always, forward-looking statements and information can be identified by the use of words such as "may", "will", "should", "plans", "expects", "intends", "anticipates", "believes", "budget", and "scheduled" or the negative thereof or variations thereon or similar terminology. Forward-looking statements and information are necessarily based upon a number of estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties and contingencies. Readers are cautioned that any such forward-looking statements and information are not guarantees and there can be no assurance that such statements and information will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Company's expectations are disclosed under the heading "Risks and Uncertainties" in the Company's Annual Report and under the heading "Risk Factors" in the Company's Annual Information Form (AIF) in respect of its financial year-ended December 31, 2008, both of which are filed with Canadian regulators on SEDAR (www.sedar.com). The Company expressly disclaims any intention or obligation to update or revise any forward-looking statements and information whether as a result of new information, future events or otherwise. All written and oral forward-looking statements and information attributable to us or persons acting on our behalf are expressly qualified in their entirety by the foregoing cautionary statements.
SOURCE Polaris Minerals Corporation
For further information: For further information: Herb Wilson, President and CEO, Mike Westerlund, Director, Corporate Development, Polaris Minerals Corporation, Tel: (604) 915-5000, firstname.lastname@example.org