Belvedere Reports Financial and Operating Results for Third Quarter of 2012
November 30 2012 - 2:05PM
Marketwired Canada
Belvedere Resources Limited (TSX VENTURE:BEL) ("The Company") is pleased to
report financial and operating results for the quarter ending September 30,
2012.
David Pym (CEO) comments "Despite an extremely difficult nickel market impacting
our revenues, with the lowest prices seen in the industry since the 2008
financial crisis, our operations have remained profitable through a careful cost
management programme. We remain committed to developing our gold operations with
bulk metallurgical studies underway at our Kopsa gold copper project, and a
significant new grassroots discovery at our Antikanpera gold project. Both of
these projects are within a 50 km radius of our nickel mill."
Key Financial Points
-- Nickel price at lowest levels since 2008 financial crisis, despite this
the mine remained profitable
-- Revenues: EUR6.82 million/CDN$ 8.49 million (Q2 2012: EUR8.86
million/CDN$ 11.38 million)
-- Operating Income(i) : EUR0.82 million/CDN$ 1.02 million (Q2 2012:
EUR2.07 million/CDN$ 2.66 million)
-- Net income of EUR0.28 million/CDN$ 0.35 million (Q2 2012: EUR1.31
million/CDN$1.68 million)
(i)Operating Income is calculated here as sales less operating costs and
excludes depletion, depreciation and amortisation.
The condensed consolidated interim financial statements, and management's
discussion and analysis have been filed with the Canadian securities regulatory
authorities. Complete results will also be available on SEDAR and on the
Company's Website. All currency amounts are expressed in euros (EUR) unless
otherwise stated.
Key Operational Points
-- Production of 535.9 tonnes of nickel in concentrate
-- Jul 2012 - New parallel gold zone discovered at Hirsikangas (2.14m @
14.25 g/t Au)
-- Aug 2012 - First bedrock gold discovery at Kangaskyla, up-ice from high
grade boulder train
-- Sep 2012 - Multiple drill holes intersect significant gold
mineralisation at Antikanpera discovery
SELECTED FINANCIAL INFORMATION
The following selected financial information in the table that follows has been
derived from the condensed consolidated interim financial statements of the
Company for the periods indicated and should be read in conjunction with such
statements and notes thereto. Those financial statements have been prepared in
accordance with International Financial Reporting Standards.
The Company generated net income for the quarter ended September 30, 2012 of
EUR283,220, which compares with EUR549,884 or EURnil per share reported for the
same period of fiscal 2011. The principal causes of these quarterly and annual
variations are explained after the 'Financial Highlights' table following:
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Selected Financial Information
All amounts in EUR000's, except Quarter ended Quarter ended
shares and per share figures September 30 2012 September 30 2011
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Revenue 6,821 5,821
Operating Expenses 6,312 5,258
G&A Expenses (ii) 251 260
Other (income) and expenses(ii) 217 367
(Gain) loss on fair valuation
derivative liability (164) (521)
Income tax recovery (78) (93)
Net income (loss) 283 550
Earnings (loss) per share (basic
and diluted) - -
Cash Flow (used) from operating
activities 307 516
Cash Flow (used) from investing
activities (283) (156)
Cash Flow (used) from financing
activities (245) (525)
Effect of foreign exchange rate
changes on cash (221) (119)
Net increase (decrease) in cash (442) (284)
Cash at end of period 3,050 2,524
Total Assets 25,270 22,839
Total Liabilities 12,671 12,027
Shareholders' equity 12,967 9,554
Working Capital (iii) 21 382
Weighted average number of shares
outstanding 151,812,291 140,692,743
Dividends per Share - -
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(i) Includes stock based compensation
(ii) Includes interest received, interest paid and foreign exchange (gain) loss
(iii) Current assets less current liabilities
-- The Hitura mine produced 535.9 tonnes of nickel in concentrate, 98% of
planned production, and EUR6,820,832 in revenue.
-- Cash decreased by EUR441,746 over the previous quarter to EUR3,050,931
as a result of positive cash flows generated by Hitura operations offset
by mine investment, exploration and development costs and a payment made
to Jinchuan in respect of preference shares redeemed.
-- General and administrative expenses were largely in line with the
corresponding quarter in fiscal 2011 at EUR247,248 (Q3 2011:
EUR256,340).
-- Other expense in the quarter was EUR52,729 compared to income of
EUR154,263 in Q3 2011 as a consequence of foreign exchange losses and
lower fair value gain on the warrants derivative liability.
-- Accounts receivable of EUR1,567,811 compares to EUR1,160,621 in Q2.
Inventory decreased to EUR1,184,771 from EUR1,613,551 in Q2 as a result
of improved procurement procedures. The increase in prepaid expenses to
EUR234,959 from EUR81,173 in Q2 relates to an overpayment of preference
share dividends.
-- Capital assets increased to EUR16,608,195 (Q2: EUR16,588,078) as a
consequence of development work at the Hitura mine and on the Company's
gold properties.
-- Current and long term liabilities decreased to EUR12,966,691 (Q2:
EUR13,732,131) due to a reduction in accounts payable, mark-to-market of
electricity contracts, deferred tax liability and the expiry of the
warrants liability.
Operations Outlook
The results of the most recent quarter demonstrate the company's ability to
adapt to a very challenging nickel market. A focus on cost reduction has allowed
operations to remain profitable in a very low nickel price environment while
continuing to finance the company's move into gold production. For the fourth
quarter of 2012, nickel markets are expected to remain challenging, and
continuing to impact mine revenues. Nickel pricing is expected to improve from
current levels over the next six months as significant production has been
removed from the market due to project delays, mine closures and the loss of the
higher cost nickel pig-iron production. The forecast nickel surplus for 2013, in
management's opinion, will not materialise and the market will return to
balance, with a subsequent re-rating of the nickel price. Should this happen
Belvedere will be well positioned to exploit the price increases from a lower
cost base.
On the gold front the company continues to generate and explore new targets and
make new discoveries, such as the Antikanpera and Kangaskyla gold discoveries
announced this quarter and demonstrated new potential on its Hirsikangas gold
property with the discovery of a new high-grade parallel zone of mineralisation.
The Antikanpera discovery in particular is showing significant promise with five
out of five drill holes to date intersecting significant widths and grades of
mineralisation. The Kopsa development property is advancing through to
feasibility studies, with bulk metallurgical testing well underway. Subsequent
to the quarter end a NI 43-101 compliant resource has been published. The final
metallurgical results will determine the optimised process route and lead to the
Feasibility study to be completed in 2013.
Forward Looking Statement: Some of the statements contained herein may be
forward-looking statements, which involve known and unknown risks and
uncertainties. Without limitation, statements regarding future plans and
objectives of the Company (including statements relating to future cash flows
and operating costs) are forward-looking statements that involve various degrees
of risk. It is important to note that the Company's actual results could differ
materially from those in such forward-looking statements.
About Belvedere: Belvedere Resources Limited is a mining company incorporated in
British Columbia with a primary focus on nickel, gold, cobalt and copper in
Finland. The Company currently produces 2200t of nickel in concentrate/year from
the Hitura nickel mine in Central Finland. The Company has a number of advanced
gold projects in close proximity to the Hitura mine.
FOR FURTHER INFORMATION PLEASE CONTACT:
Belvedere Resources Ltd.
David Pym
CEO
Suite #404, Vancouver World Trade Centre
999 Canada Place, Vancouver. BC. V6C 3E2, Canada
www.belvedere-resources.com
Humbercrest Capital Inc.
Scott Findlay
+1 647 274 2536
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