Andean American Gold Corp. Reports Financial Results for the Quarter Ended June 30, 2012
17.08.2012 | Marketwire
TORONTO, 08/17/12 - Andean American Gold Corp. ("Andean" or the "Company") (TSX VENTURE: AAG) (FRANKFURT: AQN) reports that for the three months ended June 30, 2012, it has recorded a net loss US$13,610,824 or US$0.09 per share compared to a net loss of US$7,568 or US$0.00 per share for the same period in 2011. This was mainly due to a write-off of exploration properties of $19,185,013 for the three month ended June 30, 2012 which is as a result of the anticipated closing of the transaction with Lupaka mentioned below. Andean ended the quarter with a cash position of US$14,612,605 and a working capital surplus of US$13,029,640.In November 2011, the Company announced that it had retained Paradigm Capital Inc., as its financial advisor to conduct an analysis of the strategic alternatives available to the Company, and on July 5, 2012, the Company and Lupaka Gold Corporation ("Lupaka") announced the signing of a binding Letter of Intent that provides for a combination of the two companies (the "Business Combination") to create a new Peru-focused gold exploration and development company. Under the terms of the Business Combination, Andean American shareholders will receive 0.245 shares of Lupaka for each share of Andean American owned, resulting in the shareholders of Andean American owning 45.27% of Lupaka upon the completion of the Business Combination. The meeting of shareholders is planned for September 21, 2012 to approve the transaction.
Selected Financial Information
(Expressed in United States Dollars, except share capital amounts):
June 30, June 30,
2012 2011
---------------------------------------------------------------------------
Net Loss for the period $13,610,824 $7,568
Loss per share $0.09 $0.00
Total assets $32,615,817 $64,251,792
Working capital surplus $13,029,640 $19,999,255
Mineral properties $8,562,538 $39,405,443
Share Capital:
Outstanding 150,976,810 143,095,892
Warrants 2,500,000 5,589,368
Options 6,850,000 5,977,588
---------------------------------------------------------------------------
Cash Flow and Liquidity
As at June 30, 2012, Andean had working capital surplus of US$13,029,640, compared to a working capital surplus of US$19,999,255 at June 30, 2011. For the three months ended June 30, 2012, Andean used cash of US$914,527, which included cash used in operations of US$938,275, expenditures on plant and equipment and mineral properties and deferred costs of US$1,013,017. This was offset by financing activities of $1,036,765.
The information above should be reviewed in conjunction with the Company's unaudited consolidated financial statements, management discussion and analysis, for the three months ended June 30, 2012 that will be available shortly on www.sedar.com. For further information call (416) 368-9500 or toll free: 1-888-356-4784 or visit our website at www.AAGgold.com.
Andean is a Canadian based exploration and development company that has concentrated its operations and exploration activities in Peru, a country with a long and successful history in mining and the necessary infrastructure and mining skills to support the growth of its mining industry. The Company's key asset is its 31,600 hectare Invicta gold-silver-copper advanced exploration stage project located in the Huaura Province. Andean also owns approximately 17% of Southern Legacy Minerals Inc. ("Southern Legacy"), formerly called Sinchao Metals Corp ("Sinchao"), a company listed on the TSX-V trading under the symbol 'LCY', which has properties in Peru and Chile.
On behalf of Andean American Gold Corp.,
Bruce Ramsden
Vice President, Finance and CFO
This news release may contain forward-looking information within the meaning of the Securities Act (Ontario) ("forward-looking statements"). Such forward-looking statements may include the Company's plans for its mineral projects, the overall economic potential of its properties, the availability of adequate financing and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements expressed or implied by such forward-looking statements to be materially different. Such factors include, among others, risks and uncertainties relating to potential political risks involving the Company's operations in a foreign jurisdiction, uncertainty of production and costs estimates and the potential for unexpected costs and expenses, physical risks inherent in mining operations, currency fluctuations, fluctuations in the price of gold and other metals, completion of economic evaluations, changes in project parameters as plans continue to be refined, the inability or failure to obtain adequate financing on a timely basis, and other risks and uncertainties, including those described in the Company's Financial Statements, Management Discussion and Analysis and Material Change Reports filed with the Canadian Securities Administrators and available at www.sedar.com.
This press release is not an offer to sell or the solicitation of an offer to buy the securities, nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to qualification or registration under the securities laws of such jurisdiction. The securities being offered have not been, nor will they be, registered under the United States Securities Act of 1933, as amended and such securities may not be offered or sold within the United States absent an applicable exemption from U.S. registration requirements.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contacts:
Andean American Gold Corp.
Bruce Ramsden, Vice President, Finance and CFO
416-368-9500
bramsden@aaggold.com
www.AAGgold.com