Sabina Gold & Silver Announces 2011 Year End Financial Results
$160 million at December 31, 2011 in cash and equivalentsVANCOUVER - Sabina Gold & Silver Corp. (the “Company”) (SBB — TSX) reported today the financial results for the year ended December 31, 2011.
2011 was a year of continued growth and change for Sabina. Highlights of the year include:
- The Company announced three updates to its gold resource estimate at the Back River Project, increasing the resource by approximately 2 million ounces year over year. The current resource is comprised of 22 million tonnes grading 5.62 g/t Au for 4 million gold ounces of indicated resource and an additional 10 million tonnes grading 6.23 g/t Au for 2 million gold ounces of inferred resources.
- As a result of the exploration success at Back River, the Company embarked on a Preliminary Economic Assessment (“PEA”) on the project late in 2011. The PEA is being completed by SRK Engineering Ltd., and is expected to be announced in April.
- During 2011, Rob Pease was appointed President & CEO of the Company replacing Tony Walsh upon his retirement. Mr. Walsh remains on the Board. In addition, to support the Company’s evolution into development at Back River, Leon Coetzer, VP, Engineering and Project Development as well as Matt Pickard, Director, Environment and Community Affairs joined the management team.
- The Company finished the year with approximately $160 million in cash and no debt.
- Subsequent to Year End, Jason Hynes, VP, Corporate Development also joined the Company.
Bathurst Inlet Port & Road Project “BIPR”
The BIPR project has been in the planning stages in Nunavut for many years and contemplates building a deep water port in Bathurst Inlet (approximately 70 km to the north of Back River) and an all weather road connecting the port to existing ice roads which service the Ekati and Diavik mines from Yellowknife, NWT. The project had been well advanced through the environmental assessment and permitting process by its previous owners, but had stalled due to a lack of potential users of the infrastructure. BIPR is a feasibility stage project and as such, contains significant baseline and environmental data particularly relating to the area proximal to Sabina’s contemplated operations.
With a view to applying this data to our own project development, in the fall of 2011, the Company purchased BIPR from its previous owners and became the proponent of the project in the permitting process. Last year the Company reported to the Nunavut Impact Review Board (“NIRB”), that it was assessing its options with the project and requested and was granted permission to file an update on its plans for BIPR at the end of March, 2012.
In the meantime, however, the sale of the Hackett River project to Xstrata has increased development activity in the region and reignited demand for BIPR, which, although not critical to the development of Back River, presents opportunities for synergies and potential economic benefits to Sabina. Consequently, Sabina and Xstrata have agreed to work together to push the project forward and will look to engage local communities and businesses and explore opportunities for direct Inuit participation in BIPR. A joint Xstrata/Sabina submission will be made to NIRB outlining high level plans for the project going forward by the end of the month.
For the year ended December 31, 2011, the Company reported a net loss of $12.6 million compared to a loss of $8.8 million in 2010. The loss in 2011 is higher than the same period in 2010 as a result of increased deferred income tax expensed and increased share-based compensation offset by increased interest income and increased amortization of the flow-through premium.
Operating expenses were $10.0 million compared to $5.4 million for the same period in 2010. The variance of $4.6 million is mainly due to increases in general and administration and share-based compensation. General and administration increased by $0.3 million due to recruiting costs incurred to fill a number of vacancies including CEO; VP Engineering and Project Development and Director, Environment and Community Relations. Share-based compensation increased by $4.1 million over 2010 due to the increased share price of the Company which is a key variable in the estimate of fair value. The number of options granted in 2011 was 2,921,410 compared to 2,223,000 in 2010.
The company had cash and cash equivalents and short-term investments of $159.9 million at December 31, 2011 compared to cash and cash equivalents of $82.8 million at December 31, 2010.
For the full December 31, 2011 financial statements and Management’s Discussion and Analysis, please see the Company website at www.sabinagoldsilver.com.
SABINA GOLD & SILVER CORP
Sabina Gold & Silver Corp. is an emerging precious metals company with district scale, world class undeveloped assets in one of the world’s newest, most politically stable mining jurisdictions: Nunavut, Canada.
Sabina’s primary properties consist of the Back River Gold Project, the Wishbone Claims, a vastly prospective grass roots project and the Hackett River silver royalty all located in Nunavut. The Company has announced the completion of the sale of Hackett River and certain claims in the Wishbone greenstone belt to Xstrata Zinc Canada Division (Xstrata) for which the Company received $50 million cash and a royalty on Xstrata’s Hackett River silver production of 22.5% of the first 190 million ounces produced and 12.5% of all silver produced thereafter.
Mr. Peter Manojlovic, P.Geo, and Vice President Exploration of Sabina Gold & Silver Corp is a Qualified Person under the terms of NI 43-101 and has reviewed the technical content of this press release and approved its dissemination.
The NI 43-101 compliant mineral resource estimate for Back River was prepared by Doug Cater, P. Geo and Project Manager for Sabina, a Qualified Person as defined by NI 43-101 as it relates to the George, Goose and Llama Mineral Resource estimates, and by Marek Nowak, P. Eng, SRK Consulting, a Qualified Person as defined by NI 43-101 as it relates to the Umwelt resource estimate.
The NI 43-101 “Technical Report for the Back River Resource Estimate” can be found on www.SEDAR.com or on the Company’s website.
All technical reports have been filed on www.sedar.com
For further information please contact:
Nicole Hoeller, Vice-President, IR:
1 888 648-4218
Forward Looking Statements
Statements relating to future operations at the Hackett River Project, the Back River Project and the Wishbone Greenstone belt and the expected results of this work are forward-looking statements within the meaning of securities legislation of certain Provinces in Canada. Forward looking statements are statements that are not historical facts and are generally, but not always, identified by the words “expects,” “plans,” “anticipates,” “believes,” “intends,” “estimates,” ‘projects,” “potential” and similar expressions, or that events or conditions “will,” “would,” “may,” “could” or “should” occur. Information inferred from the interpretation of drilling results may also be deemed to be forward looking statements, as it constitutes a prediction of what might be found to be present when and if a project is actually developed. These forward-looking statements are subject to a variety of risks and uncertainties which could cause actual events or results to differ materially from those reflected in the forward-looking statements, including, without limitation: risks related to fluctuations in metal prices; uncertainties related to raising sufficient financing to fund the planned work in a timely manner and on acceptable terms; changes in planned work resulting from weather, logistical, technical or other factors; the possibility that results of work will not fulfill expectations and realize the perceived potential of the Company’s properties; risk of accidents, equipment breakdowns and labour disputes or other unanticipated difficulties or interruptions; the possibility of cost overruns or unanticipated expenses in the work program; the risk of environmental contamination or damage resulting from Sabina’s operations and other risks and uncertainties, including those described in Sabina’s Annual Report for the year ended December 31, 2011.
Forward-looking statements are based on the beliefs, estimates and opinions of Sabina’s management on the date the statements are made. Sabina undertakes no obligation to update these forward-looking statements should management’s beliefs, estimates or opinions, or other factors, change.
This news release has been authorized by the undersigned on behalf of Sabina Gold & Silver Corp
Rob Pease, President & CEO
930 West 1st Street, Suite 202
North Vancouver, BC V7P 3N4
Tel 604 998-4175 Fax 604 998-1051
You can view the Next News item:April 26th, 2012, Sabina Announces High Grade Drill Results from 2012 Drilling at Llama Deposit, Back River Gold Project, Nunavut
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