Hillsborough Resources Limited

Hillsborough Resources Limited

November 13, 2009 18:28 ET

Hillsborough Resources Reports Q3 2009 Results

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Nov. 13, 2009) - Hillsborough Resources Limited (TSX:HLB) ("Hillsborough", "Corporation") announces a net loss of $2,621,004, or $0.03 per share, in the third quarter of fiscal year 2009. Net loss of $4,545,177, or $0.06 per share, is reported for the nine months ended September 30, 2009. On a cash basis, the Corporation's cash net loss for the three months ended September 30, 2009 was $837,125 ($0.01 per share) after adjusting for non-cash items. A cash net income for the nine months ended September 30, 2009 was $3,160,727 ($0.04 per share) after adjusting for non-cash items.

President & CEO, David Slater, states, "Although the financial results presented for the third quarter of 2009 appear to be less than stellar, it should be borne in mind that, in accordance with the requisite accounting rules, there was significant deferred revenue recorded during the second quarter, and will only be brought into current revenue as international shipments are made under the Vitol off-take agreement. We had fully expected a vessel to load during the third quarter of 2009, but for reasons beyond our control, the sailing only occurred in early October. Our SG & A costs were also negatively impacted in Q3 by one-time legal, accounting and other corporate advisory fees related to the Vitol offer for Hillsborough."

The Corporation's interim financial statements and related management's discussion and analysis for the three months and nine months ended September 30, 2009 will be available on www.sedar.com.

Highlights for the nine months ended September 30, 2009 include the following:

  • Net loss of $4,545,177 ($0.06 per share) compared to a net loss of $4,232,800 ($0.06 per share) for the same period in 2008. On a cash basis, the Corporation's cash net loss for the three months ended September 30, 2009 was $837,125 ($0.01 per share) after adjusting for non-cash items (2008 – $575,687, $0.00 per share). A cash net income for the nine months ended September 30, 2009 was $3,160,727 ($0.04 per share) after adjusting for non-cash items (2008 – cash net loss of $1,460,521, $0.02 per share).
  • Non-cash charges of $1,796,307 of accretion of equity to debt, $1,231,206 write down of inventory and $443,728 write down of assets.
  • Exchange rate gain of $148,621.
  • Equity loss of $656,718 from the Corporation's 13.36% interest in Peace River Coal Limited Partnership ("PRC").
  • 88% increase in the average sale price of Quinsam coal compared with the same period in 2008 ($103.00 per tonne and $54.85 per tonne respectively to September 30, 2009 and September 30, 2008).
  • Clean coal production from Quinsam of 292,930 tonnes, compared to 335,098 for the same period in 2008.
  • Cost per tonne sold for Quinsam of $78.63, compared to $51.19 for the same period in 2008.

Certain statements and information herein, including all statements that are not historical facts, contain forward-looking statements and forward-looking information within the meaning of applicable securities laws. Such forward-looking statements or information include but are not limited to statements or information as to estimates, forecasts, future financial or operating performance of the Corporation, future production, costs of production, capital requirements, operating expenditures, reserve potential, exploration drilling, exploitation activities and activities and events or developments that we expect to occur. Often, but not always, forward-looking statements and information can be identified by the use of words such as "may", "will", "should", "plans", "expects", "intends", "anticipates", "believes", "budget", "forecasted" and "scheduled" or the negative thereof or variations thereon or similar terminology.

With respect to forward-looking statements and information contained herein, we have made numerous assumptions including among other things, assumptions about prices, anticipated costs and our ability to achieve our goals. In particular, our statements regarding future production expectation is based on current existing current resource/reserve estimates, production contracts in place, historical costs and mining conditions.

Forward-looking statements and information are necessarily based upon a number of estimates and assumptions that, while considered by management to be reasonable and to be based on reasonable assumptions, are inherently subject to significant business, economic and competitive uncertainties and contingencies and involve known and unknown risks. Readers are cautioned that any such forward-looking statements and information are not guarantees and there can be no assurance that such statements and information will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from the Corporation's expectations include adverse exploration or development results; interruptions in the ability of the Corporation to produce coal from any of its mines; inability to meet production volumes required; adverse due diligence findings; re-assessments of corporate or development objectives and requirements; additional technical developments and considerations; unexpected increases in the costs of producing coal; changes in international coal or transportation markets; a rapid change in the value of the Canadian dollar particularly with respect to the US dollar; a fundamental slow down in the North American, Asian or worldwide economies; and other factors. See our recent annual information form and quarterly and annual management's discussion and analysis filed on SEDAR for additional information on risks, uncertainties and other factors relating to the forward-looking statements and information.

This document contains the term "cash net income/loss", which does not have a standardized meaning prescribed by Canadian GAAP and therefore may not be comparable with the calculation of similar measures by other companies. The Corporation uses this measure to analyze financial and operating performance. The Corporation feels this benchmark is a key measure of profitability and overall sustainability for the company. The term is not intended to represent operating profits nor should it be viewed as an alternative to cash flow provided by operating activities, net earnings or other measures of financial performance calculated in accordance with GAAP. Cash net income/loss is calculated as Cash Flows from Operations.

Although we have identified factors that would cause actual actions, events or results to differ materially from those disclosed in the forward-looking statements or information, there may be other factors that cause actual results, performance, achievements or events not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on the forward-looking statements or information. We expressly disclaim any intention or obligation to update or revise any forward-looking statements and information whether as a result of new information, future events or otherwise, except as required by law. All written and oral forward-looking statements and information attributable to us or persons acting on our behalf are expressly qualified in their entirety by the foregoing cautionary statements.

Contact Information

  • Hillsborough Resources Limited
    David Slater
    President & C.E.O.
    (604) 684-9288
    Hillsborough Resources Limited
    Ian Kirk, C.A.
    (604) 684-9288
    (604) 684-3178 (FAX)