GobiMin Announces its 2017 Results and Declares Dividend Payment
(Expressed in United States dollars except where otherwise indicated)
TORONTO, April 25, 2018 (GLOBE NEWSWIRE) -- GobiMin Inc. (TSXV:GMN) (the “Company” or “GobiMin”, together with its subsidiaries the “Group”) announces its financial results for the year ended December 31, 2017 and the declaration of an annual dividend of $0.01 (CAD0.01) per share.
Financial Highlights
| As at / For the year ended December 31, | 2017 | 2016 | 2015 | ||
| $ | $ | $ | |||
| Interest income | 0.5 million | 0.4 million | 0.3 million | ||
| Rental income | 0.4 million | 0.4 million | 0.3 million | ||
| Gain/(loss) on disposal of financial assets | 9,000 | 87,000 | (15,000 | ) | |
| Gain on disposal of interest in an associate | - | 9.5 million | 3.5 million | ||
| Fair value gain/(loss) on financial assets | (1.4 million | ) | 0.1 million | - | |
| Net profit/(loss) for the year | (3.1 million | ) | 6.9 million | 46,000 | |
| EBITDA (LBITDA) (1) | (2.9 million | ) | 7.6 million | 0.6 million | |
| Basic and diluted earnings/(losses) per share | (0.059 | ) | 0.136 | 0.003 | |
| EBITDA (LBITDA) per share (1) | (0.057 | ) | 0.146 | 0.012 | |
| Cash and cash equivalents | 19.1 million | 27.2 million | 26.1 million | ||
| Cash and cash equivalents per share(1) | 0.38 | 0.54 | 0.50 | ||
| Working capital | 21.7 million | 30.9 million | 23.1 million | ||
| Total non-current financial liabilities | - | - | 29,000 | ||
| Total liabilities | 3.7 million | 3.8 million | 3.2 million | ||
| Total assets | 84.0 million | 85.3 million | 81.3 million | ||
| Annual dividend per share | 0.01 | 0.01 | 0.01 | ||
Note:
- As non-IFRS measurements, EBITDA (LBITDA) (earnings (losses) before interest income and expense, income taxes, depreciation and amortization), EBITDA (LBITDA) per share and Cash and cash equivalents per share do not comply with IFRS and, therefore, the amounts presented in the above table may not be comparable to similar data presented by other companies. The data is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS.
Annual Dividend
On April 25, 2018, the Company declared an annual dividend of $0.01 (CAD0.01) per share in accordance with its dividend policy and 2017 performance. The dividend is payable on June 22, 2018 to shareholders of record on May 25, 2018.
Business Summary and Development
1. Change of Business
In light of the successful monetization of our previous investments and the current market conditions of the mining industry, the management believed that a diversified investment portfolio approach can generate more opportunities and flexibility for the Company and will create additional shareholder value in the long term. GobiMin completed its change of business from a “mining issuer” to an “investment issuer” in September 2017.
(a) Equity Investments
Equity investments represent equity interests of other publicly-trading or privately-held companies that the Group acquired.
The equity investments portfolio is summarized as follows:
(i) Gold Project in Xinjiang
The Company owns a 70% equity interest in Xinjiang Tongyuan Minerals Limited which is developing the Gold Project in Xinjiang. During this year, apart from continuing to focus on applications for conversion and renewal of the exploration and mining licences, GobiMin has been seeking for potential partners to co-develop such project. As at December 31, 2017, two of the three required Chinese standard geological reports for the conversion application were approved. The third report concerning the development plan is under preparation. As at April 25, 2018, the Department of Land Resources of Xinjiang has accepted our renewal application on existing exploration and mining licence. The renewed exploration and mining licence are expected to be received in 2018.
As at December 31, 2017, there was addition of research and development cost of $53,896 to the exploration and evaluation assets and the Group has a contractual commitment of $1.6 million for the development of the Gold Project.
(ii) Base Metal Exploration Projects in Xinjiang
The Group owns a 40% equity interest in each of the three companies incorporated in Xinjiang, China, which are engaged in exploration of nickel, copper, and gold. As at December 31, 2017, the carrying value of these companies, which are regarded as associates of the Group, amounted to $0.2 million (RMB1.3 million) in aggregate. The dissolution procedures of these three exploration companies have been commenced since November 2017.
(iii) Others
The Group holds 40,260,000 shares of Loco Hong Kong Holdings Limited (“Loco HK”), representing 8.38% of the total outstanding shares of Loco HK. Loco HK is a company incorporated in Hong Kong and the shares of which are listed on the GEM of The Stock Exchange of Hong Kong Limited under the stock code 8162. For the year ended December 31, 2017, the fair value loss on investment in Loco HK were $1.3 million.
The Group invested about $4.12 million in Dragon Silver Holdings Limited (“Dragon Silver”), a Hong Kong based metal trading and processing company, by way of (1) an equity investment of $1.1 million in 670,000 shares, representing 9.90% of its total issued capital and (2) a loan of $3 million, bearing interest at 8.5% per annum and repayable on demand at a notice of 7 days. Dragon Silver is mainly engaged in trading, production, processing and investment in precious metals and non-ferrous metals and related products.
Subsequent to December 31, 2017, the Group invested a total of RMB10 million (equivalent to approximately $1.5 million), through its China indirect wholly-owned subsidiary, in an agriculture project for development, planting and sales of primary agricultural products and plants cultivation in Hami City, Xinjiang, China. The project would occupy an area of about 250 mu (equivalent to about 166,000 sq. meters) to plant Hami red dates or any cash crops. The invested funding would be mainly used for land acquisition, infrastructure facilities, crops and staff costs as well as general working capital.
(b) Debentures
The Group would hold debentures bearing low risks and reasonable interest return from various industries through the open market. Debentures are held to receive coupon interest payments as well as to realize potential gains. The Group may dispose of debentures through the open market when the Group requires funds for operational or investment needs.
As at December 31, 2017, the Group held $6.8 million debentures with coupon rates ranged from 4.250% to 9.000% per annum and maturities ranged between November 14, 2018 and perpetual.
(c) Certificate of Deposit
The Group would hold certificate of deposit placed with licensed banks bearing coupon rates of 1% per annum or above and having maturities within one year. As at December 31, 2017, the Group held $0.5 million certificate of deposit with coupon rate of 1.030% per annum and maturity in February 2018.
2. Liquidity and Capital Resources
As at December 31, 2017, the Group had a working capital of about $21.7 million (2016: $30.9 million), by netting off its current assets of $25.4 million (2016: $34.7 million) with current liabilities of $3.7 million (2016: $3.8 million).
The Group has no difficulties in meeting obligations associated with its financial liabilities and commitment. The Group has determined that its cash and cash equivalents will be more than sufficient to finance its operation, including the current commitments of the Gold Project of approximately $1.6 million.
For further information, please contact:
| Felipe Tan, Chief Executive Officer | ||
| Tel: (852) 3586-6500 | ||
| Email: felipe@gobimin.com |
Certain statements contained in this press release constitute forward-looking information. Such statements are based on the current expectations of management of GobiMin. You are cautioned that such statements are subject to a multitude of risks and uncertainties that could cause actual results, future circumstances or events to differ materially from those projected in the forward-looking information. Forward looking information includes without limitation, statements regarding the size and quality of the Company’s mineral resources, progress in development of mineral properties, the prospective mineralization of the properties, and planned exploration programs. The reader should not place undue reliance on the forward-looking information included in this press release given that (i) actual results could differ materially from a conclusion, forecast or projection in the forward-looking information, and (ii) certain material factors or assumptions were applied in drawing a conclusion or making a forecast or projection as reflected in the forward-looking information could prove to be inaccurate. These statements speak only as of the date they are made, and GobiMin assumes no obligation to revise such statements as a result of any event, circumstance or otherwise, except in accordance with law.
“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.”
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