VANCOUVER, BC, April 7, 2021 /CNW/ - Trilogy Metals Inc.
(TSX: TMQ) (NYSE American: TMQ) ("Trilogy Metals" or "the Company")
announces its financial results for the first quarter ended
February 28, 2021. Details of
the Company's financial results are contained in the interim
unaudited consolidated financial statements and Management's
Discussion and Analysis which will be available on the Company's
website at www.trilogymetals.com, on SEDAR at www.sedar.com and on
EDGAR at www.sec.gov. All amounts are in United States dollars unless otherwise
stated.
First Quarter 2021 Results and Events Highlights
- Q1 2021 comprehensive loss for the quarter of $4.5 million.
- Q1 2021 ending cash position of $9.6
million, a decrease of $1.5
million from the previous quarter.
- 2021 budget of $27 million for
the advancement of the Upper Kobuk Mineral Projects, funded
entirely by Ambler Metals LLC, with approximately $140 million dedicated to the advancement of the
projects.
- Ambler Access Project granted 50-year right-of-way on federal
lands.
Selected Results
The following selected financial information is prepared in
accordance with U.S. GAAP.
in thousands of
dollars, except for per share amounts
|
Three months
ended
|
Selected
expenses
|
February 28,
2021
$
|
February 29,
2020
$
|
Mineral properties
and feasibility study expenses
|
-
|
1,545
|
General and
administrative
|
401
|
651
|
Investor
relations
|
154
|
126
|
Professional
fees
|
229
|
668
|
Salaries
|
439
|
224
|
Salaries –
stock-based compensation
|
2,148
|
1,196
|
Gain on derecognition
of assets contributed to
joint venture
|
-
|
(175,770)
|
Share of loss on
equity investment
|
1,120
|
178
|
Comprehensive
earnings (loss) for the period
|
(4,516)
|
171,179
|
Basic earnings (loss)
per common share
|
(0.03)
|
1.22
|
Diluted earnings
(loss) per common share
|
(0.03)
|
1.16
|
For the three months ended February 28,
2021, the Company reported net loss of $4.5 million (or $0.03 basic and diluted loss per common share).
For the comparable period in 2020, we reported net earnings of
$171 million (or $1.22 basic and $1.16 diluted earnings per common share). This
first quarter difference is primarily due to the $176 million gain on derecognition of mineral
property assets contributed to Ambler Metals upon formation of the
joint venture on February 11, 2020.
This is offset by $1.5 million of
mineral property expenses incurred during the first quarter of
2020. Furthermore, our share of loss in equity in investment is
$0.94 million higher in the current
quarter as the comparative does not include a full quarter of costs
for the equity pick up; it reflects our pro rata 50% share of
Ambler Metals' net loss from the formation of the joint venture on
February 11, 2020 through to the end
of the quarter on February 29,
2020.
Other variances noted for the comparable period were: i) a
decrease in general and administrative expenses of $0.3 million, primarily due to $0.1 million in travel cost savings (due to
COVID-19 travel restrictions), additional regulatory fees of
$0.1 million included in the
comparative quarter as well as $0.1
million recruiting fees incurred in the comparative period
for which there is no current period cost; ii) a decrease of
$0.4 million in professional fees as
the comparative period includes charges for the research and
implementation of new accounting standards and legal and accounting
fees in relation to the formation and valuation of the joint
venture, all of which do not have a current period comparative;
iii) an increase of $0.2 million in
salaries is due to the addition of management during the second
half of the prior year, for which there is no prior year first
quarter comparative; iv) an increase of $1
million in stock-based compensation driven primarily by a
0.9 million increase in the number of stock options that were
granted and vested during the first quarter of 2021 versus the
comparative period.
Ambler Access Project ("AAP")
During the quarter ended February 28,
2021, the Alaska Industrial Development and Export Authority
("AIDEA"), the United States Bureau of Land Management and the
National Park Service signed Right-of-Way agreements giving AIDEA
the ability to cross federally owned and managed lands along the
route for the AAP (formerly, Ambler Mining District Industrial
Access Project or AMDIAP). The authorizing documents with the
two agencies are the final federal permits required for the
AAP.
2021 Operating Budget for the Upper Kobuk Mineral Projects
("UKMP")
During the quarter ended February 28,
2021, the Company announced the approval of the 2021 program
and budget of approximately $27
million for the advancement of the UKMP. The budget
will be funded by Ambler Metals LLC ("Ambler Metals"), the
Company's 50/50 joint venture with South32 Limited.
Activities during the 2021 field season will include 7,600 meters
of drilling at the Arctic project focused on extracting additional
material for metallurgical work and for the conversion of mineral
resources into the measured category, along with 7,000 meters of
regional exploration drilling at drill-ready targets. During
the 2021 field season, Ambler Metals will be adhering to strict
COVID safety protocols and to Government of Alaska guidelines. Additional
information on the summer field program will be provided when
available.
Liquidity and Capital Resources
At February 28, 2021, we had
$9.6 million in cash and cash
equivalents and working capital of $9.2
million, which is sufficient to fund our ongoing operations
for at least the next 12 months. The projects are fully funded by
Ambler Metals and we do not anticipate needing to fund our 50%
share of future expenditures to advance the projects until Ambler
Metals' $145 million is spent.
Qualified Persons
Richard Gosse, P.Geo., Vice
President Exploration for Trilogy Metals Inc., is a Qualified
Person as defined by National Instrument 43-101. Mr. Gosse
has reviewed the technical information in this news release and
approves the disclosure contained herein.
About Trilogy Metals
Trilogy Metals Inc. is a metals exploration and development
company which holds a 50 percent interest in Ambler Metals LLC
which has a 100 percent interest in the UKMP in northwestern
Alaska. The UKMP is located within
the Ambler Mining District which is one of the richest and
most-prospective known copper-dominant districts located in one of
the safest geopolitical jurisdictions in the world. It hosts
world-class polymetallic volcanogenic massive sulphide ("VMS")
deposits that contain copper, zinc, lead, gold and silver, and
carbonate replacement deposits which have been found to host
high-grade copper and cobalt mineralization. Exploration efforts
have been focused on two deposits in the Ambler mining district -
the Arctic VMS deposit and the Bornite carbonate replacement
deposit. Both deposits are located within land package that spans
approximately 172,636 hectares. The Company has an agreement with
NANA Regional Corporation, Inc., a Regional Alaska Native
Corporation that provides a framework for the exploration and
potential development of the Ambler mining district in cooperation
with local communities. Our vision is to develop the Ambler mining
district into a premier North American copper producer.
Cautionary Note Regarding Forward-Looking
Statements
This press release includes certain "forward-looking
information" and "forward-looking statements" (collectively
"forward-looking statements") within the meaning of applicable
Canadian and United States
securities legislation including the United States Private
Securities Litigation Reform Act of 1995. All statements, other
than statements of historical fact, included herein, including,
without limitation, statements relating to the planned expenditures
and the anticipated drilling, the Company's ability to fund its
operations, the requirement for additional funding at Ambler Metals
and the perceived merit of the Company's properties are
forward-looking statements. Forward-looking statements are
frequently, but not always, identified by words such as "expects",
"anticipates", "believes", "intends", "estimates", "potential",
"possible", and similar expressions, or statements that events,
conditions, or results "will", "may", "could", or "should" occur or
be achieved. Forward-looking statements involve various risks and
uncertainties. There can be no assurance that such statements 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 include the
uncertainties involving success of exploration activities,
permitting timelines, requirements for additional capital, risks
pertaining to the outbreak of the coronavirus (COVID-19),
government regulation of mining operations, environmental risks,
prices for energy inputs, labour, materials, supplies and services,
uncertainties involved in the interpretation of drilling results
and geological tests, unexpected cost increases and other risks and
uncertainties disclosed in the Company's Annual Report on Form 10-K
for the year ended November 30, 2020
filed with Canadian securities regulatory authorities and with the
United States Securities and Exchange Commission and in other
Company reports and documents filed with applicable securities
regulatory authorities from time to time. The Company's
forward-looking statements reflect the beliefs, opinions and
projections on the date the statements are made. The Company
assumes no obligation to update the forward-looking statements or
beliefs, opinions, projections, or other factors, should they
change, except as required by law.
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SOURCE Trilogy Metals Inc.