Geomark Announces Third Quarter 2011 Results
18 Novembre 2011 - 10:30PM
Marketwired Canada
NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED
STATES
Geomark Exploration Ltd. (Geomark or the Company) (TSX VENTURE:GME) is pleased
to announce its operating and financial results for the third quarter ended
September 30, 2011. The quarterly report is summarized in this release, with the
complete version of the related condensed consolidated financial statements and
notes, as well as management's discussion and analysis, available on the System
for Electronic Document Analysis and Retrieval (SEDAR) at www.sedar.com and on
Geomark's website at www.geomark.ca
Highlights
As at and for the periods ended Three months Nine months
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September September
30, 2010 30, 2010
September Restated September Restated
30, 2011 (1) 30, 2011 (1)
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Financial ($ 000s, except $ per
share)
Revenue
Mineral Division (2) 178 13,636 530 13,779
Oil and Gas Division 521 526 1,482 1,785
Funds Flow (3) 193 60 585 223
Per Share Basic and Diluted
(4) 0.00 0.00 0.01 0.00
Cash Deficiency from Operations (104) (182) (290) (398)
Per Share Basic and Diluted
(4) (0.00) (0.00) (0.01) (0.01)
Net Earnings (Loss) (281) 13,274 (167) 13,096
Per Share Basic and Diluted
(4) (0.01) 0.26 (0.00) 0.25
Capital Expenditures
Mineral Division 501 47 1,793 47
Oil and Gas Division 11 1 26 158
Total Assets
Mineral Division 41,266 40,174
Oil and Gas Division 11,015 10,796
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Oil and Gas Operations
Barrels of Oil Equivalent (BOE)
per day (5) 125 161 129 156
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(1) The comparative highlights have been restated with the adoption of
International Financial Reporting Standards (IFRS).
(2) Geomark is a junior mineral exploration company with mineral revenue
currently from non-production sources.
(3) Funds flow is not a recognized measure under IFRS. For these purposes, the
Company defines funds flow as funds provided by operations after including
investment dividend and interest income and the changes in non-cash investing
working capital related to these sources of investment income.
(4) Geomark issued one common share upon incorporation on April 20, 2010, and on
July 6, 2010 issued 52,039,760 common shares as consideration for the net
investment in Geomark Operations with an ascribed net book value of $21,152,000
as at December 31, 2009 and cancelled the original common share. For purposes of
the per share calculations, it was assumed that all 52,039,760 shares issued
have been outstanding since January 1, 2010.
(5) Barrels of Oil Equivalent (BOE) are calculated using a conversion ratio of 6
MCF to 1 barrel of oil. The conversion is based on an energy equivalency
conversion method primarily applicable at the burner tip and does not represent
a value equivalency at the wellhead and as such may be misleading if used in
isolation.
Business Development
-- Geomark's business strategy is to acquire either early stage or smaller
advanced precious metal mineral properties and operate exploration
programs on them to advance the prospects into defined economic deposits
or producing assets.
-- The Geomark team has been very actively seeking mineral exploration
opportunities (projects and/or companies) in North America. Many
precious metal properties have been examined with a significant number
advancing through to Confidentiality Agreements and detailed analysis
and property visits.
-- In this current environment of record high commodity prices and related,
but overheated property valuations, Geomark is committed to maintaining
its prudent approach to joint venture and M&A activity. Recent market
volatility in the last several months, however, appears to have
tightened credit markets somewhat, leading to concern by junior
exploration companies over their ability to finance their projects going
forward. Geomark's large cash position of approximately $40 million, its
current very liquid investments of approximately $10 million and cash
flow derived from its oil and gas (O&G) production, dividends and
interest income provide the Company many investment advantages compared
to its peers.
Financial
-- The Company's solid financial position provides it with the means and
flexibility to act quickly in any future potential deal. Working capital
at September 30, 2011 was approximately $48.0 million, including the
value of liquid investments of $9.2 million. Geomark's anticipated
annual cash flow from its O&G operations and interest and investment
income will be more than adequate to pay all general and administrative
costs on a yearly basis and to provide a portion of the funding for
property acquisitions and/or exploration.
Operations
-- Geomark completed a $1.65 million exploration program on four of its
Ontario gold properties in 2011. This included a 6,500 meter drill
program (11 drillholes) on two of the Company's Timmins area properties.
Results indicated generally low gold tenor in the eleven drillholes,
however, the degree of alteration and shearing observed suggested
proximity to a potential mineralized system (see press releases dated
June 28, 2011 and September 18, 2011 for additional information).
Further assessment of these results will be undertaken prior to any
additional programs on the properties.
Outlook
-- The Company's main focus continues to be the pursuit of new precious
metal properties that can be added to the Company's portfolio. Geomark
has very experienced management and a strong technical team with a
history of success and an enviable balance sheet. The Company will
continue to direct its efforts toward precious metal targets in
jurisdictions with low geopolitical risk.
Cautionary Statement
This summarized news release should not be considered a suitable source of
information for readers who are unfamiliar with Geomark Exploration Ltd. and
should not be considered in any way as a substitute for reading the full report.
For the full report, please go to www.geomark.ca
Use of non-IFRS financial measures
Included in this MD&A we use the term "funds flow" to analyze the Company's
operating performance. Funds flow is not a standardized measure recognized under
IFRS and does not have a standardized meaning prescribed by IFRS. This funds
flow calculation is considered by management to be informative for shareholders
and analysts. This measure may differ from those made by other companies and
accordingly may not be comparable to such measures as reported by other
companies.
Geomark's funds flow is calculated by adding investment dividend and interest
income and the changes in non-cash investing working capital related to these
sources of investment income to cash flow (deficiency) from operating
activities.
Forward-Looking Statements
Certain statements contained in this MD&A include statements which contain words
such as "anticipate", "could", "should", "expect", "seek", "may", "intend",
"likely", "will", "believe" and similar expressions, statements relating to
matters that are not historical facts, and such statements of our beliefs,
intentions and expectations about development, results and events which will or
may occur in the future, constitute "forward-looking information" within the
meaning of applicable Canadian securities legislation and are based on certain
assumptions and analysis made by us derived from our experience and perceptions.
Forward-looking information in this MD&A includes, but is not limited to:
expected cash provided by continuing operations; future capital expenditures,
including the amount and nature thereof; mineral prices and demand, oil and
natural gas prices and demand; expansion and other development trends of the
mineral and oil and gas industry; business strategy and outlook; expansion and
growth of our business and operations; and maintenance of existing customer,
supplier and partner relationships; supply channels; accounting policies; credit
risks; and other such matters.
All such forward-looking information is based on certain assumptions and
analyses made by us in light of our experience and perception of historical
trends, current conditions and expected future developments, as well as other
factors we believe are appropriate in the circumstances. The risks,
uncertainties, and assumptions are difficult to predict and may affect
operations, and may include, without limitation: foreign exchange fluctuations;
equipment and labour shortages and inflationary costs; general economic
conditions; industry conditions; changes in applicable environmental, taxation
and other laws and regulations as well as how such laws and regulations are
interpreted and enforced; the ability of mineral companies to raise capital; the
effect of weather conditions on operations and facilities; the existence of
operating risks; volatility of oil and natural gas prices; oil and gas product
supply and demand; risks inherent in the ability to generate sufficient cash
flow from operations to meet current and future obligations; increased
competition; stock market volatility; opportunities available to or pursued by
us; and other factors, many of which are beyond our control. The foregoing
factors are not exhaustive.
Actual results, performance or achievements could differ materially from those
expressed in, or implied by, this forward-looking information and, accordingly,
no assurance can be given that any of the events anticipated by the
forward-looking information will transpire or occur, or if any of them do, what
benefits will be derived therefrom. Except as required by law, Geomark disclaims
any intention or obligation to update or revise any forward-looking information,
whether as a result of new information, future events or otherwise.
The forward-looking information contained herein is expressly qualified by this
cautionary statement.
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