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PhosCan Chemical Announces Results for Quarter Ended October 31, 2012


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© Marketwire 2012
2012-12-14 16:33:11 -

TORONTO, ONTARIO -- (Marketwire) -- 12/14/12 --


(All dollar amounts are expressed in Canadian currency unless otherwise noted.)


PhosCan Chemical Corp. (TSX:FOS) today released its quarterly results for the period ended October 31, 2012.


PhosCan reported net income of $276 for the three months ended October 31, 2012 compared to net income of $1,336,756 for the same period of the previous year. The decrease of $1,336,480 was primarily due to a decrease in foreign exchange gain. For the nine months ended October 31, 2012, the Company reported a net (loss) of ($48,190) compared to net income of $566,924 for the same period of the previous year. The decrease of $615,114 was primarily due to a decrease in foreign exchange gain partly offset by decreases in administration and share-based payment expenses.



For the three and nine months ended October 31, 2012, the Company reported other comprehensive (losses) of ($6,276) and ($3,689), respectively, resulting in comprehensive (losses) for the periods of ($6,000) and ($51,879), respectively. In June 2012, the Company commenced purchasing for investment purposes the common shares of publicly-listed companies which it believes are undervalued. At October 31, 2012, the Company owned common shares with a total market value of $391,740 and the reported other comprehensive losses represented unrealized losses on these investments.


Cash and short-term investments were $60,306,211 at October 31, 2012 versus $64,238,595 at January 31, 2012. Working capital was $60,544,988 versus $63,546,638. The decreases were primarily due to expenditures on the Martison Project, corporate expenses and the repurchase of the Company's common shares under a normal course issuer bid.


Capitalized expenditures on the Martison Project were $93,716,283 at October 31, 2012 as compared to $91,147,796 at January 31, 2012. During and subsequent to the quarter, PhosCan's efforts continued to be focussed on the metallurgical test programs aimed at finding a process to profitably recover niobium and/or rare earths contained in the Martison Deposit. The Company expects to complete its current metallurgical program by January 31, 2012.


During the quarter, the Company renewed its normal course issuer bid. The Company repurchased for cancellation during the quarter an aggregate of 754,636 of its common shares under the original and renewed normal course issuer bids. Subsequent to the quarter end, the Company repurchased for cancellation 427,112 common shares. To date, PhosCan has repurchased and cancelled an aggregate of 5,700,248 of its common shares under the original and renewed bids at an average price per share of $0.288, which represents a price discount to pro forma cash and short-term investments per share of 23.9%. Under the renewed normal course issuer bid, the Company may purchase up to 12 million of its common shares, representing at the time of renewal approximately 9.4% of the Company's public float. The renewed bid will remain open until October 18, 2013 or any such earlier date as the Company may complete its purchases or otherwise terminate the bid.


For a more complete review of the Company's results, copies of PhosCan's financial statements and management's discussion and analysis for the three and nine months ended October 31, 2012 may be found on SEDAR (www.sedar.com) or the Company's website at www.phoscan.ca.


About PhosCan


PhosCan owns a 100% interest in the Martison Project and currently has cash, short term investments and marketable securities of approximately $60.4 million. The Company continues to monitor economic conditions for attractively priced acquisitions and investment opportunities that would be accretive to shareholder value.


Certain information set forth in this news release may contain forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the control of PhosCan, including, but not limited to, the impact of general economic conditions, industry conditions, volatility of financial markets and commodity prices, risks associated with the uncertainty of exploration results and estimates and that the resource potential will be achieved on development projects, results of future metallurgical testing, currency fluctuations, dependence upon regulatory approvals, and the uncertainty of obtaining additional financing. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements.



Contacts:

PhosCan Chemical Corp.

Stephen Case

President & CEO

(416) 972-9222

www.phoscan.ca



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