GrowMax Resources Announces First Quarter 2017 Results and New Director Nominees
Working Capital of $46.6 million as at March 31, 2017
CALGARY, ALBERTA--(Marketwired - May 29, 2017) - GrowMax Resources Corp. (the "Company" or "GrowMax Resources") (TSX VENTURE:GRO) announces that it has filed its condensed interim consolidated financial statements and Interim MD&A - Quarterly Highlights relating to its first quarter 2017 results. These filings can be accessed on SEDAR's website at www.sedar.com and on the Company's website at www.growmaxcorp.com. In addition, the Company announces further details regarding the extension and modification of its commitments related to the Bayovar Property in Peru, and details of the Company's upcoming annual and special meeting of common shareholders, at which the Company intends to propose two new directors for election, both with significant fertilizer industry experience.
Stephen Keith, President of GrowMax Resources, stated, "We are pleased to report that in addition to progressing our potash and phosphate projects in Peru, we were able to limit spending in Q1/17 while monetizing non-core available-for-sale financial assets, allowing us to increase our cash and equivalents on hand to approximately $46.4 million as at March 31, 2017. The Company's strong working capital balance combined with the progress we continue to make on our core Peruvian fertilizer assets has helped us to attract strong new board members, which we believe further strengthens our positioning and ability to execute our strategy of becoming a leading producer of potash and phosphate fertilizer products in Peru."
SUMMARY OF SELECTED FINANCIAL AND OPERATIONAL HIGHLIGHTS
The following Summary of Selected Financial and Operational Highlights have been derived from the condensed interim consolidated financial statements and Interim MD&A - Quarterly Highlights. Readers are encouraged to review the entire condensed interim consolidated financial statements and Interim MD&A - Quarterly Highlights. All amounts are in Canadian dollars unless otherwise stated.
| ($ in thousands) | March 31, 2017 | December 31, 2016 | ||
| Cash and cash equivalents | $ | 46,390 | $ | 42,896 |
| Working capital(1) | $ | 46,637 | $ | 49,634 |
| Three months ended March 31 | ||||
| ($ in thousands) | 2017 | 2016 Restated(2) | ||
| General and administrative expenses (excluding stock-based compensation and depreciation) | $ | (822) | $ | (970) |
| Foreign exchange gain (loss) | $ | (593) | $ | (998) |
| Capital expenditures, net | $ | (1,430) | $ | (1,727) |
See notes (1) and (2) further below.
Bayovar Property Transfer Agreement Extension
In May 2017, a two-year extension and modification to the Company's commitments pursuant to the transfer agreement was approved. As a result, the following commitments related to the project are outstanding as of the current date:
- Complete a revised economic study by March 2018;
- Commence production by May 2019;
- Payment of US$0.5 million payable over two years to a Peruvian state-owned company, half of which will be distributed by the Peruvian state-owned company to the local community;
- Produce a minimum of 70% of the annual sales volume set forth in the applicable economic study; and
- Invest a minimum of US$19.8 million in the project from May 2016 to May 2019, of which the Company estimates that it has fulfilled approximately US$3.9 million up to May 2017.
GrowMax Resources is focused on working towards reaching these commitments and moving forward on the Bayovar Project.
Directors and Meeting of Common Shareholders
GrowMax is pleased to announce that the Company's annual and special meeting of common shareholders will be held at 3:00 P.M. (Calgary Time) on June 28, 2017 at The Metropolitan Centre, 333 - 4th Avenue S.W., Calgary, Alberta (the "Shareholders Meeting"). A Notice of Meeting and Management Information Circular ("Information Circular") setting out the items of business as well as other regulatory disclosures will be mailed to all shareholders of record as at May 23, 2017. Shareholders are encouraged to attend the Shareholders Meeting in person or to submit their proxies and voting instruction forms in the manner set out in the Information Circular.
At the Shareholders Meeting, two new directors, Mr. John Van Brunt and Mr. Stephen Paxton, are being proposed for election as directors of the Company. Mr. Ken Geren elected not to stand for re-election as a director.
Mr. John Van Brunt is a chemical engineer and fertilizer industry executive with more than 40 years of experience in the production and distribution of agricultural products. He was a director of Rio Verde Minerals Development Corp. from 2011 to the spring of 2013. Mr. Van Brunt was the Chief Executive Officer of Agrium Inc. from 1993 until his retirement in September 2003. Prior thereto, he was the President of Cominco Fertilizers from 1991 to 2003. He has served on the Executive Committee of the International Fertilizer Association ("IFA") located in Paris between 2003 and 2005 and as the President of the IFA from 2003 to 2005. Mr. Van Brunt has also served on the board of directors of several private and public companies involved in the fertilizer industry.
Mr. Steven Paxton is a former senior executive with The Mosaic Company and predecessor companies and has over 35 years of global fertilizer sales and marketing management experience. Mr. Paxton is currently a director of JDC Phosphates, a private phosphate technology development company since March 2014. Prior thereto, Mr. Paxton was Vice President International Sales for The Mosaic Company between October 2004 and June 2010 during which time he also served as President and Director of the Phosphate Chemical Export Association (PhosChem). During his 35 year tenure as an industry executive, he also served on several boards of directors including the Canadian Potash Export Association, Coromandel Fertilizer Pty. Ltd, Chinhae Chemical Company and IMC Pacific Limited. He served as a phosphate industry consultant to the United States Trade Representative for WTO negotiations with China. Mr. Paxton graduated with a Bachelor of Science in Marketing from Indiana State University in 1974, and from the Advanced Management Program at Northwestern University's Kellogg Graduate School of Business in 1998.
Abby Badwi, Executive Chairman, commented, "We are very pleased to have Mr. Van Brunt and Mr. Paxton agreeing to join our board. Their vast collective experience in the fertilizer business will be most valuable for the Company and its forward growth plans. The board of GrowMax and I would also like to thank Mr. Ken Geren for his time and effort as director of the Company since June 2015. His involvement in re-organizing the Company and its future direction was very valuable." Mr. Geren commented, "It has been my pleasure to serve on GrowMax Resources' board of directors. When I joined the board, my intention was to help better align management and shareholder interests. I believe this has largely been achieved. With the potential addition of two extremely strong board members, which add valuable fertilizer industry experience, I am comfortable stepping down from my position at this time."
The Company would like to congratulate its director, Mr. Rakesh Kapur, Joint Managing Director, Indian Farmers Fertiliser Cooperative Limited (IFFCO), on being elected the Chairman of the International Fertilizer Association ("IFA") at IFA's recent Annual Conference. Paris based IFA is the global Fertilizer Association having approximately 500 Members Worldwide representing 68 countries.
Notes:
- Working capital is calculated as current assets (March 31, 2017 - $48.7 million; December 31, 2016 - $52.4 million) less current liabilities (March 31, 2017 - $2.1 million; December 31, 2016 - $2.8 million). Working capital is a non-GAAP measure and is calculated as current assets less current liabilities. Working capital is used to assess liquidity and general financial strength. Working capital does not have a standardized meaning prescribed by IFRS. It is unlikely for non-GAAP measures to be comparable to similar measures presented by other companies. Working capital should not be considered an alternative to, or more meaningful than current assets or current liabilities as determined in accordance with IFRS.
- Restated to reflect discontinued operations. See note 17 of the March 31, 2017 condensed interim consolidated financial statements for further information.
About GrowMax Resources Corp.
GrowMax Resources Corp. is a publicly listed Canadian company (Ticker GRO on TSX-V) focused on exploration and development of phosphate and potassium-rich brine resources on its Bayovar Property, which is located in the Sechura Desert in northwestern Peru. The Company's vision is to become a leading producer of phosphate and potash fertilizer products in Peru.
GrowMax Resources owns approximately 92% of GrowMax Agri Corp., a private company that owns 100% of the Bayovar Property, which currently covers approximately 227,000 gross acres. The Indian Farmers Fertiliser Co-operative Limited (IFFCO) and its affiliates own approximately 8% of GrowMax Agri Corp.
Forward-Looking Information
Certain statements contained in this Press Release may constitute "forward-looking information" as such term is used in applicable Canadian and US securities laws. Any information or statements contained herein that express or involve discussions with respect to predictions, expectations, plans, projections, objectives, assumptions or future events should be viewed as forward-looking information. Such information relate to analyses and other information that are based upon forecasts of future results, estimates of amounts not yet determinable and assumptions of management. Such forward-looking information involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different than those results, performance or achievements expressed or implied by such forward-looking information.
In particular, statements (express or implied) contained herein or in the Company's Interim MD&A - Quarterly Highlights regarding the following should be considered as forward-looking information: the Company's goals, growth, plans, strategy and objectives; progress on the Company's assets; the Company's positioning and ability to execute its strategy of becoming a leading produce of potash and phosphate fertilizer projects in Peru; the reaching of the Company's commitments and moving forward on the Bayovar Project; and the election of new board members.
Additional forward-looking information is contained in the Company's Interim MD&A - Quarterly Highlights, and reference should be made to the additional disclosures of the assumptions, risks and uncertainties relating to such forward-looking information in that document.
There is no assurance that such forward-looking information will prove to be accurate as actual results and future events could vary or differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward looking statements contained in this Press Release. This cautionary statement expressly qualifies the forward-looking statements contained herein and in the Interim MD&A - Quarterly Highlights.
Forward-looking information is based on management's beliefs, expectations, estimates and opinions on the date statements are made and the Company undertakes no obligation to update forward-looking information and whether the beliefs, expectations, estimates and opinions upon which such forward-looking information is based has changed, except as required by applicable law.
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