Medoro Resources Announces 2004 Year-end Results
Medoro Resources Announces 2004 Year-end Results
TORONTO, May 2 /CNW/ - Medoro Resources Ltd. (TSX-V/AIM:MRL) announced
today its 2004 year-end results for the periods ending December 31, 2004.
Medoro was formed following the business combination between Full Riches
Investments Limited and a wholly-owned subsidiary of Gold Mines of Sardinia,
plc.
For the year ended December 31, 2004, Medoro reported a loss of
$9.9 million or $0.14 per share as compared to a loss of $0.3 million or $0.07
per share in the previous period. The 2004 results largely reflects the loss
on disposal of the majority of the Gold Mines of Sardinia assets.
On October 20, 2004, the company announced the completion of the sale of
most of its assets in Sardegna to Sargold Resource Corporation for a total of
(euro) 6 million plus $1 million in Sargold shares payable over a period of
60 months. With this sale, Medoro significantly improved its financial
position, ending the year with cash of $2.4 million, receivables of
$10.6 million and no debt. Subsequent to the end of the year, Medoro also
completed two private placements for gross proceeds of $4.9 million.
With these transactions, Medoro has completed its transformation from an
under-funded, marginally profitable former gold producer to a well-funded
junior explorer. At Monte Ollasteddu, Gold Fields has completed a geophysical
survey to follow up on last year's drilling results and help better identify
targets for this year's program, which is expected to commence as soon as
necessary approvals are obtained. The company continues to seek a joint
venture partner for its Pestarena project and is actively pursuing other
opportunities elsewhere in Europe.
Financial Statements follow
MEDORO RESOURCES LTD.
(formerly Full Riches Investments Ltd.)
Consolidated Balance Sheets
(Expressed in Canadian dollars)
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December 31, October 31,
2004 2003
-------------- --------------
ASSETS
CURRENT
Cash and cash equivalents $ 2,448,813 $ 3,221,339
Accounts receivable 75,981 9,468
Promissory note (Note 5 (b)) - 50,000
Prepaid and deposits - 1,973
Current portion of note receivable
(Note 5 (a)) 747,908 -
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3,272,702 3,282,780
LOAN RECEIVABLE (Note 3) - 662,925
NOTE AND SHARES RECEIVABLE (Note 5 (a)) 5,882,880 -
MINERAL PROPERTIES (Note 6) 5,979,873 -
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$ 15,135,455 $ 3,945,705
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LIABILITIES
CURRENT
Accounts payable and accrued
liabilities $ 401,534 $ 97,762
FUTURE INCOME TAXES (Note 8) 2,130,031 -
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2,531,565 97,762
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SHAREHOLDERS' EQUITY
Share capital (Note 7) 29,161,976 6,706,001
Contributed surplus (Note 7) 584,622 -
Shares to be issued (Note 3 (e)) - 15,000
Special warrants (Note 3 (b)) - 2,490,905
Subscriptions received (Note 3 (b)) - 1,255,000
Deficit (17,142,708) (6,618,963)
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12,603,890 3,847,943
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$ 15,135,455 $ 3,945,705
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MEDORO RESOURCES LTD. (formerly Full Riches Investments Ltd.)
Consolidated Statements of Operations and Deficit
(Expressed in Canadian dollars)
Fourteen
months ended Year ended
December 31, December 31,
2004 2003
-------------- --------------
OPERATING EXPENSES
Amortization $ - $ 97
Bank charges and interest 5,730 5,824
Bridge financing fee - 15,000
Consulting fees 922,425 65,419
Director fees 119,409 -
Insurance - 8,000
Investor relations, transfer agent and
filing fees 168,921 10,774
Legal and accounting 537,145 68,139
Office 22,330 9,249
Rent 4,000 10,560
Stock-based compensation 160,269 -
Telephone 2,080 508
Travel and promotion 527,348 4,935
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2,469,657 198,505
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OTHER INCOME (EXPENSES)
Accreted interest on note receivable 162,593 -
Foreign exchange gain (loss) 208,575 (2,850)
Interest income 44,846 6,516
Loss on disposal of capital assets - (1,844)
Other income 3,805 -
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419,819 1,822
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NET LOSS FROM CONTINUING OPERATIONS (2,049,838) (196,683)
NET LOSS FROM DISCONTINUED OPERATIONS
(Note 5) (8,228,907) (150,000)
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NET LOSS FOR THE PERIOD (10,278,745) (346,683)
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DEFICIT, BEGINNING OF PERIOD (6,618,963) (6,272,280)
CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING
POLICY (Note 2(i))
(245,000) -
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ADJUSTED OPENING BALANCE (6,863,963) (6,272,280)
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DEFICIT, END OF PERIOD $ (17,142,708) $ (6,618,963)
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LOSS PER SHARE FROM CONTINUING OPERATIONS $ (0.03) $ (0.03)
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LOSS PER SHARE FROM DISCONTINUED
OPERATIONS $ (0.12) $ (0.03)
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BASIC AND DILUTED LOSS PER SHARE $ (0.15) $ (0.06)
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BASIC AND DILUTED WEIGHTED-AVERAGE NUMBER
OF COMMON SHARES OUTSTANDING 68,590,779 5,935,925
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See accompanying Notes to the Consolidated Financial Statements.
MEDORO RESOURCES LTD. (formerly Full Riches Investments Ltd.)
Consolidated Statements of Cash Flows (Expressed in Canadian dollars)
Fourteen
months ended Year ended
December 31, December 31,
2004 2003
-------------- --------------
OPERATING ACTIVITIES
Net loss from continuing operations $ (2,049,838) $ (196,683)
Items not affecting cash:
Loss on disposal of capital assets - 1,844
Amortization - 97
Stock compensation expense 160,269 -
Foreign exchange (gain) loss on note
receivable (208,575) 2,850
Accreted interest on note receivable (162,593) -
Bridge financing fee - 15,000
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(2,260,737) (176,892)
Changes in non-cash working capital items
Accounts receivable (66,513) (8,107)
Prepaid and deposits 1,973 2,465
Accounts payable and accrued liabilities 303,772 80,414
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(2,021,505) (102,120)
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INVESTING ACTIVITIES
Acquisition of mineral properties
(Note 4) (1,006,042) -
Proceeds on disposition of subsidiary,
net (Note 5 (a)) 763,130 -
Repayment of promissory note 50,000 -
Advances to Gold Mines of Sardinia plc - (662,925)
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(192,912) (662,925)
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FINANCING ACTIVITIES
Issuance of common shares for cash 7,528,485 -
Proceeds from bridge financing - 660,900
Repayment of bridge financing - (660,900)
Issuance of special warrants - 2,490,905
Issuance of subscriptions receipts - 1,255,000
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7,528,485 3,745,905
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NET INCREASE IN CASH FROM CONTINUING
OPERATIONS 5,314,068 2,980,860
NET DECREASE IN CASH FROM DISCONTINUED
OPERATIONS (Note 5 (a)) (6,086,594) -
CASH, BEGINNING OF PERIOD 3,221,339 240,479
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CASH, END OF PERIOD $ 2,448,813 $ 3,221,339
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See accompanying Notes to the Consolidated Financial Statements.
MEDORO RESOURCES LTD. (formerly Full Riches Investments Ltd.)
Consolidated Statements of Cash Flows (Expressed in Canadian dollars)
SUPPLEMENTAL CASH FLOW INFORMATION
Fourteen
months ended Year ended
December 31, December 31,
2004 2003
-------------- --------------
Interest paid $ - $ 5,070
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The following transactions are not reflected in the consolidated
statement of cash flows:
During the fourteen month period ended December 31, 2004:
(i) 44,171,118 common shares, 5,793,918 share purchase warrants and
1,182,888 share purchase options with a value of $8,895,626 were
issued in connection with the acquisition of Sardinia Gold Mining
SpA (Note 3).
(ii) 4,000,000 common shares with a value of $2,200,000 were issued in
connection with the acquisition of Miniere di Pestarena srl
(Note 4).
(iii) 1,000,000 common shares with a value of $180,000 were issued in
consideration for services provided in connection with the sale of
GMS Australia (Note 5 (a)).
(iv) 140,624 common shares with a value of $70,312 as payment for
certain liabilities.
(v) 75,000 common shares with a value of $15,000 as consideration for
a bridge facility (Note 3 (c)).
(vi) The Company received a long-term note, payable in cash and shares,
with a discounted value of $6,630,788 as consideration on the sale
of GMS Australia (Note 5 (a)).
See accompanying Notes to the Consolidated Financial Statements.
For further information: Peter Volk, Assistant Secretary,
(416) 603-4653, info(at)medororesources.com
(MRL)
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