Kirrin Resources Reports 2011 Results and Provides Corporate Update
April 30 2012 - 11:00AM
Marketwired Canada
Kirrin Resources Inc. (TSX VENTURE:KYM) today reported its 2011 financial
results and fourth quarter highlights and provided an outline of progress and
developments since postponing a private placement in December. As announced at
that time, Kirrin is reviewing its plans for 2012 and examining what options are
available to maximise shareholder value. Summary financial data for the 2011
results is set out in tabular form below.
Kirrin recorded a net loss for the year of $1,716,986 (2010: loss $960,791) of
which $912,833 (2010: $431,347) arose from the write-down of mineral interests
and $398,600 from project development and current exploration expense (2010:
$34,625). The balance sheet was weakened by the postponement of the private
placement in December 2011 resulting in a failure to replenish treasury and
leading to the year ending with a working capital deficit of $425,815 (2010:
positive working capital $1,335,347). Current assets at year end amounted to
$107,335 compared to $2,029,311 a year earlier. Excluding non-cash items, being
stock based compensation and amortization, and interest income, general and
administrative costs increased by 15% to $574,367 from $500,341 in 2010, largely
as a result of an expanded Investor Relations program.
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2011 2010 2009
$ $ $
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Working capital (deficit) (425,815) 1,335,347 303,164
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Mineral interests 1,672,803 1,643,711 1,428,943
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Total assets 1,780,138 3,673,022 2,312,870
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Total long term financial liabilities 180,000 283,000 141,907
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Shareholders' equity 1,066,988 2,696,058 1,590,200
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Net income (loss) for the year (1,716,986) (960,791) (924,908)
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Loss per share 0.04 0.04 0.07
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Shares outstanding(1)(2) 46,559,930 46,268,263 20,599,673
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(1) All figures in Canadian dollars except for shares outstanding.
(2) 2008 has been revised to reflect the 1 for 10 share consolidation
approved May 1, 2009.
Highlights during the fourth quarter of 2011 include agreements on revisions to
the option agreements for the Bottom Brook and Grevet rare earth elements (REE)
projects, with extensions to the expenditure profiles for both projects, the
surrender of the Key Lake SW uranium project option following failure to agree
amendments to the governing agreement, the release of conclusions and results
from Kirrin's extensive 2011 exploration program at Grevet, and the postponement
of the $1.5 million private placement of announced in October 2011.
Corporate update
Kirrin President and CEO, Derek Moran, said: "Market sentiment has changed
markedly over the past year and Kirrin must respond by utilising its assets,
physical and human, more imaginatively. Investors' appetite for early stage
exploration has diminished and Kirrin needs to provide a lower risk profile to
attract funding." Mr Moran continued that while supply and demand fundamentals
for uranium and REE remained robust, short term concerns are currently driving
investor sentiment.
Kirrin's internal review has concluded that its uranium and REE exploration
portfolio is essentially sound. The three remaining projects represent the
outcome of three years exploration and 2012 and 2013 should be their determining
years. The conclusive drilling plans across all projects require a budgeted cost
of $2.0 million albeit that drilling only priority targets would cost some $1.2
million. Funding for such budget is not currently available without a strategic
partner. As an alternative, Kirrin may rank its projects and proceed only with
those ranked as priority. Kirrin had already renegotiated its 2012 work
obligations under all three option agreements.
Management is also examining how Kirrin's risk profile may be reduced: new
projects, particularly those at an advanced stage of development, are being
reviewed. This review is not limited to small scale projects or the uranium and
REE sectors, or, indeed, Canada, and Kirrin welcomes enquiries from potential
partners. While this review is on-going, there can be no assurance that
management will succeed in Kirrin acquiring or combining with projects or
entities that will achieve the objective of reducing the Company's risk profile.
Kirrin also confirmed that it did not meet its entire 2011 flow-through
expenditure obligation and anticipates expenditure in the order of $350,000 to
settle the obligation. Expenditures have been curtailed to conserve cash
resources and outstanding trade payables are in the order of $80,000.
Reg A. Olson, Ph.D., P. Geol., is the designated Qualified Person for Kirrin on
the Alexis River, Bottom Brook and Grevet projects.
Annual General and Special Meeting
Kirrin will announce the date its annual meeting of shareholders in due course,
along with the date of mailing the Annual Report, Proxy and Information
Circular. The financial statements for the year ended December 31, 2011 and
accompanying Management's Discussion and Analysis are available on
www.kirrinresources.com and at www.sedar.com.
Kirrin operates two REE properties, Grevet in Quebec and Bottom Brook in
Newfoundland, both of which have returned encouraging exploration results with
REE grades exceeding 15% TREO, and a uranium project, Alexis River, in
southeastern Labrador. Kirrin is also conducting due diligence on two new
projects, a HREE property in Europe and a further uranium property in the
Athabasca Basin in Saskatchewan.
Additional information on Kirrin is available on Kirrin's web site at
www.kirrinresources.com and on SEDAR at www.sedar.com.
Cautionary Statement
This news release contains "forward-looking statements" within the meaning of
applicable securities laws relating to certain future results and activities of
Kirrin, including potential future financing and other potential corporate
transactions or projects. Readers are cautioned not to place undue reliance on
forward-looking statements. Forward-looking statements are based on certain key
assumptions made by Kirrin, including assumptions related to Kirrin's ability to
complete any such financing in a reasonable timeframe, the receipt of regulatory
approval and the availability of capital and other resources to maintain
operations and to carry out contemplated exploration programs and other
projects. Such forward looking statements are subject to known and unknown
risks, uncertainties and other factors which may cause actual results and
developments to differ materially from those contemplated by these statements
depending on, among other things, failure to complete any such financing or
transaction, failure to obtain regulatory approval and insufficient funds or
other resources to maintain operations or complete such projects. The
forward-looking statements in this press release are made as of the date of this
release and Kirrin undertakes no obligation to update publicly or revise any
forward-looking statements whether as a result of new information or otherwise,
except as required by applicable securities laws. Kirrin undertakes no
obligation to comment on analyses, expectations or statements made by
third-parties in respect of Kirrin or its financial or operating results or (as
applicable) its securities.
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