GobiMin Announces Results of 2008 and Declares $0.07 (CAD$0.08) Dividend
Fri Apr 17, 6:13 PM
(Expressed in United States dollars except where otherwise indicated)
TSX-V: GMN
TORONTO, April 17 /CNW/ - GobiMin Inc. (the "Company" or "GobiMin") has reported today its financial and operating results of 2008 and has declared an annual and a special dividend totaling $0.07 (CAD$0.08) per share. GobiMin has approximately $1.25/share (CAD$1.52/share) in cash as of April 16, 2009.
The audited consolidated financial statements along with management's discussion and analysis have been filed with SEDAR (www.sedar.com) and are also available at the website of the Company (www.gobimin.com).
Financial Highlights
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Year ended Year ended Changes
December 31, December 31, on
2008 2007 yearly basis
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Revenue $21.4 million $38.5 million -44.3%
Net earnings $0.03 million $20.4 million -99.8%
EBITDA(1) $6.3 million $26.0 million -75.9%
Gross Margin 44.6% 69.8% -36.1%
Basic earnings per share $0.00 $0.29 -99.8%
Diluted earnings per share $0.00 $0.28 -99.8%
EBITDA per share(1) $0.09 $0.37 -76.4%
Cash and cash equivalents $54 million $22 million 140.2%
Cash and cash equivalents
per share(1) $0.76 $0.30 150.9%
Cash cost per tonne of ore,
after by-product credits(1) $20.32 $14.04 44.7%
Annual dividend per share $0.01 $0.03 -66.7%
(1) As non-GAAP measurements, EBITDA, EBITDA per share, Cash and cash
equivalents per share and Cash cost per tonne of ore do not comply
with GAAP and, therefore, the amounts presented in the above table
may not be comparable to similar data presented by other companies.
The data is intended to provide additional information and should not
be considered in isolation or as a substitute for measures of
performance prepared in accordance with GAAP.
Annual and Special Dividend
---------------------------
On April 16, 2009, the Company declared an annual dividend of $0.01
(CAD$0.01) per share for 2008 in accordance with the Company's dividend policy
and a special dividend of $0.06 (CAD$0.07) per share following the disposal of
its two Chinese operating subsidiaries. Both dividends are payable on June 5,
2009 to shareholders of record on May 15, 2009.
Business Summary and Development
--------------------------------
(a) Completion of sale of two Chinese operating subsidiaries
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On November 3, 2008, the Company announced that it had entered into two revocable framework agreements with Xinjiang Xinxin Mining Industry Co., Ltd. ("Xinxin") to dispose of its two Chinese operating subsidiaries, which held three nickel-copper mining properties in Hami, Xinjiang (the "Transaction"). The Transaction involved the sale of GobiMin's entire 93.55% and 95.16% respective equity interests in Xinjiang Yakesi Resources Co. Ltd. ("Yakesi") and Hami Jubao Resources Co. Ltd. ("Jubao"), through its wholly owned subsidiary, Alexis Investments Limited ("Alexis").
After the completion of Xinxin's due diligence review and audit of Yakesi and Jubao's accounts as at October 31, 2008 and the receipt of the applicable approvals, the Company and Xinxin finalized the terms of the Transaction and entered into two irrevocable Sale and Purchase Agreement (the "Definitive Agreement") on November 23, 2008. Under the Definitive Agreement, Xinxin agreed to acquire Alexis's equity interest in Yakesi and Jubao for a total cash consideration (the "Consideration") of RMB492.33 million (approximately $72 million).
During February 2009, the Transaction was approved and registered by the Chinese regulatory authority. The Consideration was paid to the Company by February 28, 2009. Pursuant to the Definitive Agreement, Yakesi and Jubao declared a special dividend of RMB43.89 million (approximately $6.4 million) which was paid to Alexis together with the final installment of the Consideration. The earnings or losses of Yakesi and Jubao after November 1, 2008 belong to Xinxin. Accordingly, the losses in November and December 2008 of approximately $1 million are reported as losses in our 2008 results in accordance with Canadian GAAP and will be reflected as an increase in the gain on disposal in our 1st quarter results in 2009 (see the Company's news release of November 24, 2008).
By April 16, 2009, the Company was debt free and held approximately $87.5 million (CAD$106.5 million) in cash. Most of the cash is kept outside of China for future project opportunities and approximately $10.4 million cash is held in China to fund existing and potential exploration projects in China.
(b) Normal Course Issuer Bid
------------------------
On February 6, 2008, the Company began a normal course issuer bid to repurchase some of its common shares on the TSX Venture Exchange. The Company repurchased 3,236,100 common shares during the year. All shares purchased were returned to treasury for cancellation. GobiMin had 70,324,402 shares outstanding as at December 31, 2008.
On January 23, 2009, the Company renewed its normal course issuer bid to repurchase an additional 3,516,220 common shares over a maximum period of 12 months ending January 31, 2010. By April 16, 2009, the Company had repurchased and cancelled a further 374,800 common shares. GobiMin now has 69,949,602 shares outstanding.
Outlook
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Following the disposal of its two Chinese operating subsidiaries, which held three nickel-copper mining properties in Hami of Xinjiang, China in February 2009, GobiMin is now in a strong financial position to develop its existing and potential projects. The Company's objective is to make opportunistic acquisitions in this environment where excellent projects abound. In the meantime, the Company may apply its free cash to metal trading operations.
Management will continue exploration of the Yanxi Copper Project in view to develop this property at an opportunistic time.
Certain statements contained in this press release constitute forward-looking information. Such statements are based on the current expectations of management of GobiMin. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause actual results, future circumstances or events to differ materially from those projected in the forward-looking information. These risks include, but are not limited to, risks associated with fluctuations in metal prices, risks associated with mining exploration including environmental hazards, GobiMin's reliance on key personnel, the potential for changes in the legislative and regulatory environment in China and other risks and uncertainties detailed from time to time in GobiMin's annual report and other filings with the Canadian securities commissions. The reader should not place undue reliance on the forward-looking information included in this press release given that (i) actual results could differ materially from a conclusion, forecast or projection in the forward-looking information, and (ii) certain material factors or assumptions were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking information could prove to be inaccurate. These statements speak only as of the date they are made, and GobiMin assumes no obligation to revise such statements as a result of any event, circumstance or otherwise, except in accordance with law. Additional information about (i) the material factors that could cause actual results to differ materially from the conclusion, forecast or projection in the forward-looking information, and (ii) the material factors or assumptions that were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking information, is contained in the GobiMin's annual report and other documents filed from time to time with the Canadian securities commissions, all of which are available at www.sedar.com and the Company's website www.gobimin.com.
"Neither TSX Venture Exchange nor the Investment Industry Regulatory
Organization of Canada accepts responsibility for the adequacy or
accuracy of this release."
To receive GobiMin press releases by email, send a message to
info@gobimin.com and specify "GobiMin press releases" on the
subject line
ContactsJames Xiang
Chief Financial Officer
GobiMin Inc.
Tel: (416) 915-0133
Email: james@gobimin.com
www.gobimin.com
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