Silver Bear Provides Operational Update and Announces 2011 Third Quarter Results
TORONTO, ONTARIO -- (Marketwire) -- 11/14/11 -- Silver Bear Resources Inc. ('Silver Bear' or the 'Company') (TSX: SBR) today provides an operational update and announces its financial results for the third quarter ended September 30, 2011.
On September 28, 2011, Silver Bear announced a robust Preliminary Economic Analysis ('PEA') on its Mangazeisky project located 400 kilometres north of Yakutsk, Russia (see September 28, 2011 news release). Importantly, the total tonnes of ore projected to be mined over the 'life of mine' in the PEA was exclusive of any potential additional Silver mineral resources delineated during the 2011 drill program. Management believes the 2011 drill program has the potential to increase mineral resources and add to Silver Bear's already strong economic story to build a mine and processing facility at site. Silver Bear expects to release some of its assay results from this year's drilling program in the coming days. As well, Silver Bear expects to release an updated National Instrument 43-101 mineral resource statement, incorporating the 2011 drilling results, in Q1, 2012.
Silver Bear is continuing exploration work on its Mangazeisky project as well as working on its Russian Feasibility Study (the 'Russian TEO'). The Russian TEO is part of the initial process of obtaining a 'Certificate of First Discovery' on the property. Once the 'Certificate of First Discovery' is obtained, Silver Bear can then make application for a mining license within the Mangazeisky lease project. Silver Bear expects the Russian TEO to be submitted prior to year end 2011. Receipt of a 'Certificate of First Discovery' is expected in 2012 with immediate application for a mining license to follow. There are also ongoing discussions with Russian regulators regarding Silver Bear's request to extend its existing exploration license into 2012.
Silver Bear also announces today its financial results for the quarter ended September 30, 2011, prepared in accordance with International Financial Reporting Standards ('IFRS'). All dollar amounts are stated in Canadian dollars, unless otherwise indicated.
Financial Results
Silver Bear incurred a total loss for the three and nine months ended September 30, 2011 of $5.00 million, ($0.11 per share) and $7.01 million ($0.17 per share) respectively. This compares to a total income of $0.04 million ($Nil per share) and a loss of and $1.53 million ($0.04 per share) respectively for the three and nine months ended September 30, 2010. Exploration costs were $3.79 million and $4.57 million compared to $0.27 million and $1.15 million for the three and nine months ended September 30, 2011 and 2010 respectively. General and administrative expenses were $0.90 million and $1.65 million compared to $0.36 million and $1.23 million for the three and nine months ended September 30, 2011 and 2010 respectively. Non-cash items were $0.39 million and $0.93 million compared to $0.19 million and $0.55 million for the three and nine months ended September 30, 2011 and 2010 respectively. Interest income was $0.04 million and $0.10 million compared to $0.02 million and $0.04 million for the three and nine months ended September 30, 2011.
Liquidity and Capital Resources
At September 30, 2011, Silver Bear had cash and cash equivalents of $8.31 million. The Company has no debt outstanding. Silver Bear anticipates that it has a sufficient amount of cash and cash equivalents to meet its short term objectives. Additional funding may be required in the longer term. Silver Bear has budgeted and expects to complete a 5,000 cubic metre trenching program in 2011 at a cost of $1.60 million with an additional $1.40 million of corporate costs. Silver Bear has expanded its 2011 exploration program to include a drilling program. The planned drilling program of 15,000 meters will not be achieved this year. Current estimates of 8,000 to 9,000 meters are more likely. Variances between drill metres achieved and those budgeted were mainly due to later than expected commencement of drilling (late July vs late June 2011) resulting from delays in transporting drilling equipment to site. As well, problems with ground conditions and equipment breakdowns affected drilling performance. The revised estimated cost of the 2011 drill program is expected to be reduced from $7.5 million to approximately $5.5 to $6 million.
Silver Bear Resources Inc.
Condensed Consolidated Interim Statement of Financial Position
(Canadian dollars)
(Unaudited)
September 30, December 31,
2011 2010
----------------------------------------------------------------------------
ASSETS
Current assets
Cash and cash equivalents 8,314,576 11,114,277
Receivable 656,535 24,117
Inventories 919,810 1,097,946
Prepaid expenses 1,187,047 37,697
----------------------------------------------------------------------------
Total current assets 11,077,968 12,274,037
----------------------------------------------------------------------------
Non-current assets
Mineral property 1,074,619 1,085,277
Property, plant and equipment 615,851 900,072
----------------------------------------------------------------------------
Total assets 12,768,438 14,259,386
----------------------------------------------------------------------------
----------------------------------------------------------------------------
LIABILITIES
Current liabilities
Accounts payable and accrued liabilities 457,085 301,535
Non-current liabilities
Asset retirement obligation 589,254 588,609
----------------------------------------------------------------------------
Total liabilities 1,046,339 890,144
----------------------------------------------------------------------------
SHAREHOLDERS' EQUITY
Capital Stock 78,730,574 73,771,289
Contributed surplus 9,784,065 9,166,433
Accumulated other comprehensive loss (424,650) (211,508)
Deficit (76,367,890) (69,356,972)
----------------------------------------------------------------------------
Total shareholders' equity 11,722,099 13,369,242
----------------------------------------------------------------------------
Silver Bear Resources Inc.
Condensed Consolidated Interim Statement of Comprehensive Loss
For the three and nine months ended September 30, 2011 and 2010
(Canadian dollars)
(Unaudited)
Three months ended Nine months ended
----------------------------------------------------------------------------
September September September September
30, 30, 30, 30,
2011 2010 2011 2010
----------------------------------------------------------------------------
Income
Interest income 39,424 17,449 96,547 44,851
Other income - 839,724 - 1,352,664
----------------------------------------------------------------------------
39,424 857,173 96,547 1,397,515
----------------------------------------------------------------------------
Expenses
Exploration costs 3,792,524 271,359 4,573,847 1,148,919
General and
administrative 897,726 357,556 1,645,227 1,234,182
Amortization 28,959 165,240 296,974 492,388
Share-based payment 357,845 12,779 622,558 44,771
Gain on disposal of
property, plant - 4,803 - 2,881
and equipment
Interest expense 2,230 2,223 6,766 6,721
Foreign exchange
loss (gain) (42,201) 2,201 (37,907) (1,116)
----------------------------------------------------------------------------
Expenses from
operations 5,037,083 816,161 7,107,465 2,928,746
----------------------------------------------------------------------------
Total Loss for the
period (4,997,659) 41,012 (7,010,918) (1,531,231)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Other comprehensive
income (loss)
Exchange
differences on
translating (348,512) 43,307 (213,142) 90,400
foreign operations
----------------------------------------------------------------------------
Total Comprehensive
Loss for the period (5,346,171) 84,319 (7,224,060) (1,440,831)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Deficit - Beginning
of the period (71,370,231) (68,636,676) (69,356,972) (67,064,433)
----------------------------------------------------------------------------
Deficit - End of the
period (76,367,890) (68,595,664) (76,367,890) (68,595,664)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Weighted average
number of common 44,203,214 37,935,569 40,552,736 37,935,569
shares outstanding
----------------------------------------------------------------------------
Basic and diluted
loss per share (0.11) 0.00 (0.17) (0.04)
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Silver Bear Resources Inc.
Condensed Consolidated Interim Statement of Changes in Equity
For the nine months ended September 30, 2011 and 2010
(Canadian dollars)
(Unaudited)
Accum-
ulated
other
Contri- compre-
Share buted hensive Total
capital surplus income Deficit equity
----------------------------------------------------------------------------
Balance -
January 1,
2011 73,771,289 9,166,433 (211,508) (69,356,972) 13,369,242
Net loss for
the period - - - (7,010,918) (7,010,918)
Other
comprehensive
income (net of
tax):
Cumulative
translation
adjustment - - (213,142) - (213,142)
----------------------------------------------------------------------------
Other
comprehensive
income (loss)
for the period - - (213,142) (7,010,918) (7,224,060)
Share based
payment - 622,558 - - 622,558
Options
exercised 10,060 (4,926) 5,134
Net proceeds
from
issuance
shares in
private
placement 4,949,225 4,949,225
----------------------------------------------------------------------------
Balance -
September 30,
2011 78,730,574 9,784,065 (424,650) (76,367,890) 11,722,099
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Balance -
January 1,
2010 73,771,289 9,089,843 - (67,064,433) 15,796,699
Net loss for
the period - - - (1,531,231) (1,531,231)
Other
comprehensive
income (net of
tax):
Cumulative
translation
adjustment - - (90,400) - (90,400)
----------------------------------------------------------------------------
Comprehensive
income (loss)
for the period - - (90,400) (1,531,231) (1,621,631)
Share-based
payment - 44,771 - - 44,771
----------------------------------------------------------------------------
Balance -
September 30,
2010 73,771,289 9,134,614 (90,400) (68,595,664) 14,219,839
----------------------------------------------------------------------------
----------------------------------------------------------------------------
Mark Trevisiol P.Eng, President and CEO of the Company and a qualified person under National Instrument 43-101 has reviewed and approved the scientific and technical information in this press release.
Silver Bear Resources Inc.
The primary business of the Company is the evaluation, acquisition, exploration and development of silver properties in the Russian Federation. The Company's principal focus is the Mangazeisky exploration lease, over which Silver Bear has exclusive exploration rights. It is located approximately 400 kilometres north of Yakutsk in the Republic of Sakha, Yakutia in the Russian Federation.
Silver Bear Resources Inc. is listed on the Toronto Stock Exchange and its common shares trade under the ticker symbol 'SBR'. Silver Bear has 44,203,902 issued and outstanding common shares. Other information relating to Silver Bear is available on SEDAR at www.sedar.com as well as on the Company's website at www.silverbearresources.com.
Forward-Looking Information
The PEA is preliminary in nature and is based on a number of assumptions that may be changed in the future as additional information becomes available. Mineral resources that are not mineral reserves do not have demonstrated economic viability. The PEA includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the PEA will be realized.
This release and subsequent oral statements made by and on behalf of the Company may contain forward-looking statements, which reflect management's expectations. Wherever possible, words such as 'intends', 'expects', 'scheduled', 'estimates', 'anticipates', 'believes' and similar expressions or statements that certain actions, events or results 'may', 'could', 'would', 'might' or 'will' be taken, occur or be achieved, have been used to identify these forward-looking statements. Although the forward-looking statements contained in this release reflect management's current beliefs based upon information currently available to management and based upon what management believes to be reasonable assumptions, Silver Bear cannot be certain that actual results will be consistent with these forward-looking statements. A number of factors could cause events and achievements to differ materially from the results expressed or implied in the forward-looking statements. Such risks factors include but are not limited to risks factors identified by Silver Bear in its continuous disclosure filings filed from time to time on SEDAR. These factors should be considered carefully and prospective investors should not place undue reliance on the forward-looking statements. Forward-looking statements necessarily involve significant known and unknown risks, assumptions and uncertainties that may cause Silver Bear's actual results, events, prospects and opportunities to differ materially from those expressed or implied by such forward-looking statements. Although Silver Bear has attempted to identify important risks and factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors and risks that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, prospective investors should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date of this release, and Silver Bear assumes no obligation to update or revise them to reflect new events or circumstances, unless otherwise required by law.
Effective June 15, 2011, the head office of Silver Bear Resources has been relocated to:
65 Queen Street West
Suite 805, P.O. Box 71
Toronto, ON M5H 2M5
For further details, please visit www.silverbearresources.com.
Contacts:
Silver Bear Resources Inc.
Bulgan Orgilsaikhan
Manager, Investor Relations
416-309-2895
borgilsaikhan@silverbearresources.com
Silver Bear Resources Inc.
Mark Trevisiol
President and Chief Executive Officer
416-309-2131
mtrevisiol@silverbearresources.com
www.silverbearresources.com