TIDMMOY
RNS Number : 5573C
Moydow Mines International Inc
16 November 2009
Third Quarter
Interim Report
Consolidated Financial Statements
Three Months Ended September 30, 2009
Toronto Office
Suite 1220, 20 Toronto Street
Toronto, Ontario M5C 2B8
Tel : (416) 703-3751
Fax : (416) 367-3638
E-mail : info@moydow.com
Dublin Office
74 Haddington Road
Dublin 4, Ireland
Tel : (353) 1-667-7611
Fax : (353) 1-667-7622
E-mail : www.moydow.com
MOYDOW MINES INTERNATIONAL INC.
CONSOLIDATED BALANCE SHEETS
(expressed in United States dollars, unless otherwise stated)
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | | December 31 |
| | | September 30 | 2008 |
| | | 2009 | (audited) |
| | | (un-audited) | |
| Assets | | | |
| | | | |
| Current assets | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| Cash and cash equivalents | | $66,078 | $146,937 |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| Accounts receivable and prepaid expenses | | 5,388 | 156,595 |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| Other assets | | 6,595 | 11,807 |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | 78,061 | 315,339 |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | 698,480 | 9,542,497 |
| Mineral properties (Note 2) | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | 776,541 | 9,857,836 |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| Liabilities | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| Current liabilities | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| Accounts payable and accrued liabilities | | 332,966 | 387,374 |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| Related party payable (Note 4) | | 8,393,342 | 6,965,039 |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| Loan | | 7,717 | 7,717 |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| Current income tax liability | | 33,674 | 33,674 |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | 8,767,699 | 7,393,804 |
| | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| Shareholders' Equity | | | |
| | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| Capital stock (Note 3) | | 22,073,991 | 22,073,991 |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| Contributed surplus | | 710,225 | 710,225 |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| Deficit | | (30,775,374) | (20,320,184) |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | 7,991,158 | 2,4654,032 |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | 776,541 | 9,857,836 |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
| | | | |
+------------------------------------------------------------------------+-----+----------------+-----------------+
Nature of operations and going concern (note 1)
MOYDOW MINES INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF EARNINGS(UN-AUDITED)
(expressed in United States dollars, unless otherwise stated)
+------------------------------------------------+----------------+----------------+----------------+----------------+
| | Three months ended | Nine months ended |
+------------------------------------------------+---------------------------------+---------------------------------+
| | Sept 30, 2009 | Sept 30, 2008 | Sept 30, 2009 | Sept 30, 2008 |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Expenses | $ | $ | $ | $ |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| | | | | |
| Write-down of mineral properties | 2,100,652 | | 9,283,849 | |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Stock - based compensation | - | 3,672 | - | 51,147 |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| General and administrative | 465,949 | 275,051 | 1,009,006 | 850,052 |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Amortization of plant & equipment | (104) | 378 | - | 1,131 |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Foreign exchange loss/ (gain) | 34,808 | (35,904) | 46,703 | (45,027) |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| | | | | |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| | 2,601,305 | 243,197 | 10,339,558 | 857,303 |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| | | | | |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Other income and expenses | | | | |
| Option fee | - | | 10,000 | |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Interest expenses | (33,425) | (87,154) | (140,999) | (264,310) |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Unrealized (loss)/ gain on financial assets | 14,324 | (20,470) | 15,184 | (27,887) |
| held for trading | | | | |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Interest income | 25 | 1,476 | 183 | 1,587 |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| | (19,076) | (106,148) | (115,632) | (290,610) |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| | | | | |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Loss before income taxes | (2,620,381) | (349,345) | (10,455,190) | (1,147,913) |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Income tax provision | - | 141,259 | - | 170,207 |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Comprehensive loss for the period | (2,620,381) | (208,086) | (10,455,190) | (977,706) |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| | | | | |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Basic and diluted loss per common share | (0.04) | (0.003) | (0.17) | (0.017) |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Weighted average number of | | | | |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| common shares outstanding | 60,572,904 | 60,572,904 | 60,572,904 | 58,961,182 |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| | | | | |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Deficit, beginning of period | (28,154,993) | (14,326,262) | (20,320,184) | (13,556,642) |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Loss for period | (2,620,381) | (208,086) | (10,455,190) | (977,706) |
+------------------------------------------------+----------------+----------------+----------------+----------------+
| Deficit, end of period | (30,775,374) | (14,534,348) | (30,775,374) | (14,534,348) |
+------------------------------------------------+----------------+----------------+----------------+----------------+
MOYDOW MINES INTERNATIONAL INC.
CONSOLIDATED STATEMENTS OF CASH FLOW (UN-AUDITED)
(expressed in United States dollars, unless otherwise stated)
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| | Three months ended | Nine months ended |
+----------------------------------------------------+---------------------------+----------------------------+
| | Sept 30, | Sept 30, | Sept 30, | Sept 30, |
| | 2009 | 2008 | 2009 | 2008 |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| | $ | $ | $ | $ |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Cash provided by (used in) operating activities | | | | |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Loss for the period | (2,620,381) | (208,086) | (10,455,190) | (977,706) |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| | | | | |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Adjustments for non-cash items: | | | | |
| Writedown of mineral properties | 2,100,652 | | 9,283,849 | |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Stock-based compensation | - | 3,672 | - | 51,147 |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Amortization of plant and equipment | (104) | 378 | - | 1,131 |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Unrealised loss on financial assets held for | 6,463 | 20,470 | 5,211 | 27,887 |
| trading | | | | |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| | (513,370) | (183,566) | (1,166,130) | (897,541) |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Changes in non-cash working capital: | | | | |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Accounts receivable and prepaid expenses | 17,961 | (237,670) | 151,207 | 184,498 |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Accounts payable and accrued liabilities | | | | |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| and income taxes | 452,641 | (190,675) | 1,373,896 | 2,069,874 |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| | 470,602 | 428,345 | 1,525,103 | 2,254,372 |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| | (42,768) | (611,911) | 358,973 | 1,356,831 |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| | | | | |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Investing activities | | | | |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Exploration of mineral properties | (5,072) | 280,837 | (439,832) | (2,154,446) |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| | | | | |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Financing activities | | | | |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Proceeds from issue of capital stock | - | - | - | 797,011 |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Loan | - | - | - | - |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| | - | - | - | 797,011 |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| | | | | |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Increase in cash and cash equivalents | (37,696) | (331,074) | (80,859) | (604) |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Cash and cash equivalents at beginning of period | 103,774 | 424,203 | 146,937 | 93,733 |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Cash and cash equivalents at end of period | 66,078 | 93,129 | 66,078 | 93,129 |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| | | | | |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Supplemental information | | | | |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Cash income taxes paid | - | - | - | - |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
| Cash interest paid | - | | - | - |
+----------------------------------------------------+-------------+-------------+--------------+-------------+
MOYDOW MINES INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(expressed in United States dollars, unless otherwise stated)
1. Nature of operations and going concern
Moydow Mines International Inc. (Moydow or the Company) is an international
exploration company with primary interests in precious metals, diamonds and
industrial minerals. Moydow's common shares are listed on both the Toronto Stock
Exchange and the AIM Market of the London Stock Exchange.
The Company is exploring its mineral properties and, as at September 30, 2009,
had not determined the existence of economically recoverable reserves (note 2).
The recoverability of the amounts shown for mineral properties is dependent upon
the existence of economically recoverable mineral reserves, the preservation of
the Company's interest in the underlying mineral claims, the ability to obtain
necessary financing, to obtain government approval and to attain profitable
production or, alternatively, upon the Company's ability to profitably dispose
of its interests.
These financial statements have been prepared using Canadian generally accepted
accounting principles applicable to a going concern, which contemplates the
realization of assets and settlement of liabilities in the normal course of
business as they come due. As at September 30, 2009, the Company had an excess
of current liabilities over current assets of $8.69 million and has recorded
losses and net cash outflows from operations for the past three years. The
Company is also required to make expenditures in the near term to keep its
mineral property rights in Angola. The Company will have to secure additional
financing to meet its required commitments. These circumstances lend substantial
doubt as to the ability of the Company to meet its obligations as they come due
and, accordingly, the appropriateness of the use of accounting principles
applicable to a going concern.
In recognition of these circumstances, the Company is exploring various
initiatives to secure capital so that Moydow can continue as a going concern. It
is not possible to determine, with any certainty, the success, adequacy or
sufficiency of these initiatives.
The Company's ability to continue as a going concern is dependent upon its
ability to fund its working capital and exploration requirements and eventually
to generate positive cash flows, either from operations or sale of a property.
These financial statements do not reflect the adjustments to the carrying values
of assets and liabilities and the reported expenses and balance sheet
classifications that would be necessary were the going concern assumption
inappropriate. These adjustments could be material.
Operating results for the periods ended September 30, 2009 are not necessarily
indicative of the results that may be expected for the full year ended December
31, 2009. For further information, see the Company's consolidated financial
statements including the notes thereto included in the Annual Report for the
year ended December 31, 2008.
MOYDOW MINES INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(expressed in United States dollars, unless otherwise stated)
2) Mineral properties
The Company, either directly or through certain joint ventures, has obligations
to expend various amounts on its mineral properties and projects in order to
keep its mineral property rights in good standing. All agreements are in the
normal course of business.
+---------------------------------+------------------+--------------------+-------------------+-----------------+
| | Angola | Sierra Leone | Ghana | Total |
| | $ | $ | $ | $ |
+---------------------------------+------------------+--------------------+-------------------+-----------------+
| | | | | |
| Balance-December 31, 2008 | 6,999,015 | 1,939,465 | 604,017 | 9,542,497 |
+---------------------------------+------------------+--------------------+-------------------+-----------------+
| | | | | |
| Costs-March 31, 2009 | 149,374 | 58,614 | 21,238 | 229,226 |
+---------------------------------+------------------+--------------------+-------------------+-----------------+
| | | | | |
| Balance-March 31, 2009 | 7,148,389 | 1,998,079 | 625,255 | 9,771,723 |
+---------------------------------+------------------+--------------------+-------------------+-----------------+
| | | | | |
| Costs-June 30, 2009 | 34,808 | 139,809 | 41,061 | 215,678 |
+---------------------------------+------------------+--------------------+-------------------+-----------------+
+---------------------------------+------------------+--------------------+-------------------+-----------------+
| Write-down | (7,183,197) | - | - | (7,183,197) |
+---------------------------------+------------------+--------------------+-------------------+-----------------+
+--------------------------------+-------------------+--------------------+--------------------+-----------------+
| | | | | |
| Balance-June 30, 2009 | - | 2,137,888 | 666,316 | 2,804,204 |
+--------------------------------+-------------------+--------------------+--------------------+-----------------+
+--------------------------------+-------------------+--------------------+--------------------+-----------------+
| Cost - | (48,251) | 11,015 | 32,164 | (5,072) |
| September 30, 2009 | | | | |
+--------------------------------+-------------------+--------------------+--------------------+-----------------+
| | | | | |
+--------------------------------+-------------------+--------------------+--------------------+-----------------+
| Write-down | 48,251 | (2,148,903) | - | (2,100,652) |
+--------------------------------+-------------------+--------------------+--------------------+-----------------+
| Balance-September 30, 2009 | - | - | 698,480 | 698,480 |
| | | | | |
+--------------------------------+-------------------+--------------------+--------------------+-----------------+
During the period ended September 30, 2009, the management of the company
decided to write off all expenditures on the Kimberlite diamond property,
Angola, in the sum of $7.18 million. The writedown was necessitated by the
extraordinary challenging times for the diamond industry and the global economic
crisis together with concerns over the commercial viability of the mineral
deposit which is dependent on a number of factors together with concerns over
the particular attributes of the deposit, such as its size, grade and proximity
to infrastructure.
The management of the Company decided to write off all expenditures on the Port
Loko property, Sierra Leone, in the sum of $2.15 million due to an on-going
dispute with the Ministry of Mineral Resources in Sierra Leone.
MOYDOW MINES INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(expressed in United States dollars, unless otherwise stated)
3) Capital stock
Authorized-Unlimited number of common shares
+----------------------------------------------------------------------------+----+------------+----+------------+
| |
+----------------------------------------------------------------------------+
| | | Number of | | $ |
| | | shares | | |
+----------------------------------------------------------------------------+----+------------+----+------------+
| | | | | |
+----------------------------------------------------------------------------+----+------------+----+------------+
| Balance | | 60,572,904 | | 22,073,991 |
| - | | | | |
| December | | | | |
| 31, 2008 | | | | |
+----------------------------------------------------------------------------+----+------------+----+------------+
| Issue | | - | | - |
| of | | | | |
| shares | | | | |
+----------------------------------------------------------------------------+----+------------+----+------------+
| Balance | | 60,572,904 | | 22,073,991 |
| - | | | | |
| September | | | | |
| 30, 2009 | | | | |
+----------------------------------------------------------------------------+----+------------+----+------------+
4) Transactions with Related Parties
Related party transactions relate primarily to the payment of fees under
contracts for services with companies in which a Moydow Mines' director is a
shareholder and director. The Company was charged a total of $0.22 million
during the nine months to September 30, 2009 (2008 - $0.15 million) with respect
to administration services.
The Company's primary legal counsel is a firm in which a director of the Company
is a partner. The Company was charged $0.0l million during the nine months to
September 30, 2009 (2008 - $0.05 million) for legal services provided by this
firm.
A company controlled by certain insiders of the Company advanced money to the
Company and interest has been accrued at Libor plus 2%. The amount of interest
charged to the Company during the first nine months of 2009 and 2008 was $0.14
million and $0.26 million, respectively.
These transactions are made in the normal course of business.
MOYDOW MINES INTERNATIONAL INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(expressed in United States dollars, unless otherwise stated)
Corporate Information.
Directors and Officers
Noel P. Kiernan - Director, Chairman
Brian P. Kiernan - Director, President & CEO
J. Joseph Breen - Director & COO
Michael E. Power - Director, Vice President & Secretary
Albert Gourley - Director & Audit Committee
Richard Linnell - Director & Audit Committee
L. Comerford - Director & Audit Committee
Rosemary G. O'Mongain - CFO
Toronto Office
12th Floor
20 Toronto Street
Toronto, Ontario
Canada, M5C 2B8
Tel: (416) 703 3751 Fax: (416) 367 3638
Registered Office
Suite 2900, 550 Burrard Street
Vancouver, British Columbia V6C 0A3
Dublin Office
74 Haddington Road
Dublin 4, Ireland
Tel: (353) 1 667 7611 Fax: (353) 1 667 7622
Transfer Agent
Computershare Trust Company of Canada
100 University Avenue, 8th Floor
Toronto, Ontario
Canada, M5J 2YI
Exchange Listing
The Toronto Stock Exchange
AIM Market of the London Stock Exchange
Symbol: MOY
CUSIP: 62472V 100
Shares outstanding: 60,572,904
Shares fully diluted: 63,872,904
To contact the Company
In order to contact the Company or to request to be added to our mailing list
please email info@moydow.com
website: www.moydow.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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