Aurora Energy Resources Inc. ("the Company" or "Aurora") (TSX:AXU) reports its
financial and operating results for the year ended December 31, 2008. The
following summary of the Company's financial results is based upon and qualified
in its entirety by reference to the audited financial statements and
Management's Discussion and Analysis (MD&A) for the year ended December 31,
2008, each available on SEDAR at www.sedar.com. Further details on each of the
Company's projects and activities can be found on the Company's website
www.aurora-energy.ca and on SEDAR at www.sedar.com. All amounts are in Canadian
dollars unless otherwise stated.
Overview
The Corporation was incorporated on June 8, 2005 and operates in the mineral
resource industry. Its principle focus is on the exploration and development of
uranium projects in the Central Mineral Belt ("CMB") in Newfoundland and
Labrador, Canada, one of the most promising uranium districts in the world, as
well as potential evaluation and acquisition of opportunities throughout the
world. Aurora is committed to responsible development with lasting local
benefits and the highest standards of safety, health, and environmental
protection.
Aurora's CMB properties consist of a total of more than 90,000 ha in 32 licenses
or groups of mineral claims collectively containing a measured and indicated
resource of 83.9 million pounds of U3O8 and an inferred resource of 49.8 million
pounds of U3O8.(1)
Significant events for the year ended December 31, 2008 include:
- Key leadership change in August 2008 with the appointment of Mr. Bruce
Dumville as the new President and Chief Executive Officer and the appointment of
Dr. Mark O'Dea to the position of Deputy Chair of the Company's Board of
Directors. Mr. Dumville has over 25 years of experience in the international
mining industry, including functional responsibility for pre-feasibility and
feasibility studies, project management, operations, and the analysis of new
investment opportunities.
- Aurora took steps to move from an exploration to a mining development company
with the recruitment of Mr. Paul Coombs as Chief Financial Officer and Corporate
Secretary, Mr. Paul McNeill as Vice-President Exploration, Mr. Chesley Andersen
as Vice-President Labrador Affairs, and Mr. Steve Cole as Director of
Engineering. Detailed senior management biographies can be found on Aurora's
website.
- Completion of the 2008 summer drill program in Labrador, which included an
infill drill campaign of 13,233.49 metres of drilling in 26 holes at the Jacques
Lake and Michelin deposits. Aurora also completed a 2,908 metre geotechnical,
environmental and metallurgical drill program in August 2008 in 25 holes. The
environmental work plan for 2008 was also substantially completed (see press
releases of Aurora dated October 24, 2008 for further details).
- Initiated a tailings management study to identify potential tailings sites for
the Michelin Project. Tailings options were identified and those that are
acceptable from an environmental, technical and operations standpoint are being
used to create a short list for further consideration in 2009 and 2010.
- Development of an education, training and employment program for residents of
North Coast Labrador is underway.
- Selection of members for the Michelin Project Community Panel, announced in
June 2008, and completion of its first meeting.
- In April 2008, the Nunatsiavut Government placed a three-year moratorium on
mining and milling of uranium on Labrador Inuit Lands. In response Aurora
implemented a revised work program to fulfill the Company's contractual and
financial obligations for 2008.
- Signing of an option agreement with Pacific Ridge Exploration Ltd. pursuant to
which the Company was granted the right to earn a 51% interest in a uranium
exploration and development property located in the Baker Lake Basin of Nunavut,
Canada. The property provides the potential to build value at an excellent entry
cost and in a jurisdiction with clearly defined policies on exploration and
mining. The Baker Lake Basin property covers 96,000 hectares and boasts
attractive near-surface uranium mineralization, including five targets with
drill-indicated mineralization, with at least 15 target areas yet to be
drill-tested (for further details, please refer to the press release of Aurora
dated September 23, 2008).
- Completion of an initial 600 metre drill program to test the Lucky 7 zone at
the Baker Lake Basin property, as well as geological mapping and ground magnetic
surveys, and an airborne magnetic, radiometric and broadband electromagnetic
survey, of which results are pending. This work is designed to cover the
property and aid in the design of the subsequent exploration program.
Aurora's 2009 program focuses on conserving the Company's substantial cash
position, while continuing to build community support and advancing
environmental and engineering studies. The program also involves completing a
tailings management options study, continuing environmental baseline studies and
metallurgical studies, and progressing the mill process design, while
implementing a comprehensive community engagement plan.
Aurora's net cash outlay for 2009 is forecasted to be C$5.9 million. The 2009
budget includes estimated interest revenue of $3.5 million and exploration
activity to reclaim $1.46 million held in bond by the province of Newfoundland
and Labrador. This is a significantly reduced budget from last year's $35
million budget.
Operations
Selected Financial Data
This summary of selected audited financial data should be read in conjunction
with the MD&A and the audited financial statements of the Company and related
notes thereto, for the periods indicated.
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For the year ended
December 31, December 31,
2008 2007
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Loss for the period $ 4,054,639 $ 7,414,906
Basic and diluted loss per share $ 0.06 $ 0.11
Cash invested in mineral properties $ 28,787,749 $ 27,981,820
Cash generated (used) by financing
activities $ 483,622 $ 110,244,554
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As at
December 31, December 31,
2008 2007
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Cash, cash equivalents & short term
deposits $ 99,720,807 $ 131,384,190
Working capital $ 98,272,334 $ 129,898,119
Exploration properties and deferred
exploration expenditures $ 87,511,616 $ 56,710,497
Total assets $ 191,024,073 $ 192,186,937
Shareholder's equity $ 179,448,674 $ 184,879,251
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The Company's net loss for the year ended December 31, 2008, was $4,054,639, or
a loss per share of $0.06, compared to a net loss of $7,414,906 and loss per
share of $0.11 for the year ended December 31, 2007. Increased interest income
offset by a reduction in stock-based compensation are the primary factors for
the improvement in the Company's net loss in 2008 as compared to 2007.
The net loss for the year ended December 31, 2008, consists primarily of wages
and benefits of $2,566,660, stock-based compensation expense of $1,706,682,
office and general expenses of $1,521,430, investor relations, promotion and
advertising expenses of $602,377, consulting fees of $522,947 and Part XII.6 tax
of $261,444, offset by interest income of $3,798,374.
Exploration Projects
The Company incurred cash expenditures of $28,787,749 for the year ended
December 31, 2008, on the development and exploration of its CMB uranium assets
and the Baker Lake Basin property (net of stock-based compensation of
$1,089,880, amortization of $478,329 and future income taxes of $445,161).
Liquidity
At December 31, 2008, the Company had cash, cash equivalents and short term
deposits on its balance sheet of $99,720,807 and working capital of $98,272,334,
as compared to cash, cash equivalents and short term deposits of $131,384,190
and working capital of $129,898,119 at December 31, 2007. The changes in cash
and working capital of $31,663,383 and $31,625,785, respectively, are primarily
related to the use of funds for deferred exploration and development
expenditures of $17,240,983 and $11,546,766, and net equipment purchase of
$459,281 offset by interest income of $3,798,374 and receipt of $550,800 upon
the exercise of stock options.
The Company currently has no operating revenues other than interest income and
relies primarily on existing cash balance to fund its exploration, development
and administrative costs.
ABOUT AURORA
Aurora is a uranium exploration and development company active in the CMB of
North Coast Labrador - one of the world's most promising uranium districts - and
in Nunavut, Canada, where it has entered into an option agreement on a Baker
Lake Basin property.
Aurora has no debt and approximately $96 million in cash that is fully liquid
and held with a large Canadian commercial bank.
The Company will be hosting its annual general meeting on April 21, 2009 at The
Rooms in St. John's, Newfoundland and Labrador.
Aurora is committed to responsible development, which includes community
consultation, lasting local benefits and the highest standards of safety,
health, and environmental protection.
(1) The Michelin deposit contains a measured resource of 1.289 million tonnes of
resource grading 0.12% U3O8 (underground) and 5.795 million tonnes of resource
grading 0.08% U3O8 (open pit), an indicated resource of 16.170 million tonnes of
resource grading 0.13% (underground) and 7.146 million tonnes of resource
grading 0.06% U3O8 (open pit), and an inferred resource of 12.577 million tonnes
of resource grading 0.12% U3O8 (underground) and 1.564 million tonnes of
resource grading 0.05% U3O8 (open pit). The Jacques Lake deposit contains a
measured resource of 0.415 million tonnes of resource grading 0.09% U3O8
(underground) and 0.401 million tonnes of resource grading 0.09% U3O8 (open
pit), an indicated resource of 3.357 million tonnes of resource grading 0.08%
(underground) and 1.909 million tonnes of resource grading 0.07% U3O8 (open
pit), and an inferred resource of 2.778 million tonnes of resource grading 0.08%
U3O8 (underground) and 2.210 million tonnes of resource grading 0.05% U3O8 (open
pit). The Rainbow deposit contains an indicated resource of 1.088 million tonnes
of resource grading 0.09% U3O8 and an inferred resource of 0.931 million tonnes
of resource grading 0.08% U3O8 (both open pit). The Nash deposit contains an
indicated resource of 0.757 million tonnes of resource grading 0.08% U3O8 and an
inferred resource of 0.613 million tonnes of resource grading 0.07% U3O8 (both
open pit). The Inda deposit contains an indicated resource of 1.460 million
tonnes of resource grading 0.06% U3O8 and an inferred resource of 3.042 million
tonnes of resource grading 0.07% U3O8 (both open pit). The Gear deposit contains
an indicated resource of 0.520 million tonnes of resource grading 0.06% U3O8 and
an inferred resource of 0.210 million tonnes of resource grading 0.06% U3O8
(both open pit). Aurora's CMB Mineral Resources are reported at cut-off grades
that contemplate underground (0.05% U3O8) and open pit (0.03% U3O8) mining
scenarios, based on preliminary economic assumptions, and may be refined with
more in-depth economic analyses. For further details of the property interests
of Aurora, please refer to the National Instrument 43-101 compliant technical
report dated April 7, 2008 and amended August 28, 2008 entitled "An Update on
the Exploration Activities of Aurora Energy Resources Inc. on the CMB Uranium
Property, Labrador, Canada, during the period January 1, 2007 to December 31,
2007, Part II - CMB Mineral Resources" prepared by Ian Cunningham-Dunlop, P.
Eng. and Christopher Lee, P. Geo., and available on SEDAR at www.sedar.com.
Except for the statements of historical fact contained herein, certain
information presented constitutes "forward-looking statements". Such
forward-looking statements, including but not limited to the timing and level of
exploration activities, including drilling activities, the timing of completion
of a pre-feasibility study and anticipated results of the 2008 work program;
involve known and unknown risks, uncertainties and other factors which may cause
the actual results, performance or achievement of Aurora to be materially
different from any future results, performance or achievements expressed or
implied by such forward-looking statements. Such factors include, among others,
risks related to the actual results of current exploration activities,
conclusions of economic evaluations, uncertainty in the estimation of mineral
resources, changes in project parameters as plans continue to be refined, future
prices of uranium, economic and political stability in Canada, environmental
risks and hazards, increased infrastructure and/or operating costs, labor and
employment matters, and government regulation as well as those factors discussed
in the section entitled "Risk Factors" in Aurora's Annual Information Form on
file with the Canadian Securities Commissions. Although Aurora has attempted to
identify important factors that could cause actual results to differ materially,
there may be other factors that cause results not to be as anticipated,
estimated or intended. There can be no assurance that such statements will prove
to be accurate as actual results and future events could differ materially from
those anticipated in such statements. Aurora disclaims any intention or
obligation to update or revise any forward-looking statements, whether as a
result of new information, future events or otherwise. Accordingly, readers
should not place undue reliance on forward-looking statements.
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