VANCOUVER, March 31, 2014 /CNW/ - Yellowhead Mining Inc. ("Yellowhead" or the "Company") (TSX: YMI) reports its results of operations for the financial year ended December 31, 2013.
For the full audited consolidated financial statements and management discussion & analysis for the financial year ended December 31, 2013, please see SEDAR at www.sedar.com or the Company's website at www.yellowheadmining.com.
Highlights for the financial year ended December 31, 2013 include:
- In April 2013, the Company submitted an application for an environmental assessment certificate ("EA Application") for the Harper Creek Project ("Harper Creek") to the British Columbia Environmental Assessment Office ("EAO")
- In May 2013, the EAO identified a number of deficiencies with, and provided a number of comments on, the EA Application, and requested the Company to address such deficiencies and comments
- In May 2013, the Company completed a 35 hole, 11,969m in-fill drilling program on Harper Creek
- Frank D. Wheatley was appointed as CEO and a member of the Board of Directors on July 1, 2013
- On November 19, 2013, the Company issued an $8.0 million convertible debenture to Matco Investments Ltd.
- On December 30, 2013, the Company's shareholders approved the full automatic conversion of the $8.0 million convertible debenture into 35,555,556 common shares of the Company at a conversion price of $0.225 per share, representing approximately 35.91% of the total issued and outstanding common shares of the Company
- Undertook a reduction in general and administrative expenses, including staffing levels, in order to position the Company to execute on its strategy for 2014
Strategy for 2014
The Company's strategy for 2014 includes:
- Updating the feasibility study for Harper Creek, including updating the resource and reserve estimates, initial capital costs, sustaining capital costs and operating costs, with a target for completion by the end of the second quarter of 2014
- Updating and revising the EA Application for Harper Creek
- Re-submitting the EA Application to the EAO by the end of the third quarter of 2014
- Continuing public consultation with all stakeholders, including local communities and local First Nations, to address any potential environmental and socio-economic impacts of Harper Creek and the Company's mitigation strategies
- Continuing negotiations with local First Nations with respect to an impact benefits agreement
Summary of Financial Results
(Amounts are expressed in thousands of Canadian dollars, except per-share amounts)
|Administrative expenses||$ 920||$ 1,881||$ 3,679||$ 5,613|
|Exploration and evaluation expenses||194||2,845||2,865||9,593|
|Net loss and comprehensive loss for the period||1,220||4,715||6,516||15,150|
|Basic and diluted loss per share for the period||$ 0.02||$ 0.08||$ 0.10||$ 0.28|
Yellowhead has no revenue from operations. Results can fluctuate significantly from period to period due to the level of engineering and environmental study effort and resource drilling.
Review of Quarterly Results
The loss in Q4 2013 was $1.22M compared to $4.72M in Q4 2012. This decrease in loss of $3.50M was primarily due to a decrease in Administrative expenses of $961K and a decrease in Exploration and evaluation expenses of $2.65M. The decrease in Administrative expenses was primarily due to lower consulting fees, lower wages and benefits and lower professional fees in Q4 2013 compared to Q4 2012. The decrease in Exploration and evaluation expenses was due to three main factors. First, the Company spent approximately $717K in Q4 2012 related to an in-fill drilling program which was announced and started in Q4 2012, and there were no costs associated with this program in Q4 2013. Second, the Company incurred approximately $836K less in environmental assessment costs as the Company filed its EA Application into the screening process in April 2013. Third, the Company recognized an adjustment of approximately $652K in Q4 2012 as a result of an audit by the Canada Revenue Agency ("CRA") related to the Province of British Columbia's Mineral Exploration Tax Credit ("METC").
Review of Annual Results
The loss in FY 2013 was $6.52M as compared to $15.15M in FY 2012. This decrease in loss of $8.63M was primarily due to a decrease in Administrative expenses of $1.93M and a decrease in Exploration and evaluation expenses of $6.73M. The decrease in Administrative expenses was primarily due to lower consulting fees, lower wages and benefits and lower investor relations costs in FY 2013 as compared to FY 2012. The decrease in Exploration and evaluation expenses was due to three main factors. First, the Company incurred $2.60M less in EA costs in FY 2013 versus FY 2012 as the Company submitted its EA Application in April 2013. Second, the Company incurred $1.55M less in engineering costs in FY 2013 versus FY 2012 as in FY 2012 the Company conducted additional engineering to support the permitting process and these costs were not incurred in FY 2013. Third, the Company recognized an adjustment of approximately $652K in FY 2012 as a result of an audit by the Canada Revenue Agency ("CRA") related to the Province of British Columbia's Mineral Exploration Tax Credit ("METC") program and no such credit was recognized in FY 2013.
Cash and Cash Equivalents
The Company had cash and cash equivalents of $10.00M as at December 31, 2013, as compared to cash and cash equivalents of $7.06M as at December 31, 2012. As at December 31, 2013, the Company had working capital of $9.70M, as compared to working capital of $7.75M as at December 31, 2012.
The Company's focus going forward, is expediting the development of the Harper Creek project. Major activities include completing the Environmental Assessment process, advancing the Mine Permitting process and pursuing funding activities to increase its working capital and develop the Harper Creek project. The Company believes its current working capital is sufficient for the next twelve months of general and administrative activities, however, additional funding will be required by the Company to complete its strategic objectives and to continue as a going concern.
About Yellowhead Mining Inc.
Yellowhead Mining Inc. is a development stage company with a 100% interest in the Harper Creek copper-gold-silver project located in the North Thompson region of British Columbia, Canada. The proposed Harper Creek mine will be a large scale, long life, low cost open pit copper mine, has a NI 43-101 compliant feasibility study, and is currently in the environmental permitting phase of development.
For more information on Yellowhead and the Harper Creek Project, please visit Yellowhead's website at www.yellowheadmining.com.
Forward Looking Statements
Except for statements of historical fact, this news release contains certain "forward-looking information" within the meaning of applicable securities laws. Forward-looking information is frequently characterized by words such as "plan", "expect", "project", "intend", "believe", "anticipate", "estimate" and other similar words, or statements that certain events or conditions "may" or "will" occur. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking statements, including, among others, the accuracy of mineral grades and related assumptions, inherent operating risks, planned expenditures, proposed exploration and development at the Harper Creek Project, operating and economic aspects of the Harper Creek Project, as well as those risk factors identified in the Company's Annual Information Form filed under the Company's SEDAR profile. Yellowhead undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change except as required by law. The reader is cautioned not to place undue reliance on forward-looking statements. More detailed information about potential factors that could affect projected results is included in the documents filed from time to time with the Canadian securities regulatory authorities by Yellowhead.
SOURCE: Yellowhead Mining Inc.
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