Whitemud Resources Reports Operations Update and 2009 Second Quarter Financial Results
Fri Aug 21, 2:53 PM
ca.news.finance.yahoo.com
CALGARY, Aug. 21 /CNW/ - Whitemud Resources Inc. ("Whitemud" or "the Company") (TSXV: WMK.V) presents an operations update and summary financial results for the second quarter ending June 30, 2009.
Whitemud has made significant progress in advancing Whitemud(MK) into the North American construction industry despite the current economic downturn that has adversely affected the construction industry and impacted the Company's efforts. The Company has secured the approval of major engineering firms and construction companies to include Whitemud(MK) in several large construction projects in Alberta.
One notable project is Calgary's landmark Bow Tower project. The contractor for this 58 story building, which will be the second-largest office complex in Canada, recently started using Whitemud(MK) in order to meet design criteria of the concrete floors.
Users have now reported the product has met performance expectations and provides a number of opportunities to lower costs. As a result of the successes, several of the engineers and contractors are evaluating the use of metakaolin in other major centres across Canada. One of the leading performance benefits of Whitemud(MK) has been to significantly reduce the CO(2) footprint of concrete construction projects and this is expected to be a strong driver of future sales growth.
The Company believes that a key to increasing sales volumes is to secure silo capacity at concrete production plants. Since the end of the first quarter, the company has increased the number of concrete plants that use Whitemud(MK) from 7 to 21. The Company expects to continue to see growth in the number of concrete plants that offer Whitemud(MK). The Company believes that a growing customer base combined with increased market acceptance will result in accelerated sales growth.
Local project successes have encouraged interest in eastern Canada and the northern United States where the Company now has secured silo space in 5 concrete plants.
The Board of Directors of the Company has taken steps to diversify the governance responsibilities. Burl Aycock has resigned as Chairman of the Board and the Board has appointed Barry Lester to the position of Chairman of the Board. Mr. Aycock will continue as Chief Executive Officer and will remain a member of the Board of Directors.
Financial highlights and results for the three and six months ended
June 30, 2009
- The Company continued to initiate sales in the three and six months
ended June 30, 2009 generating $149,679 and $251,110 respectively in
sales compared to nil in the three and six months ended June 30,
2008. After distribution and cost of goods sold the Company
experienced a negative margin of $10,419 and $1,322 respectively.
- The Company had a working capital deficit at June 30, 2009 of
$ 2,466,484 with a cash deficit of $384,960.
- To address the working capital deficit the Company closed a
convertible debenture financing on August 6, 2009 for gross proceeds
of $10.513 million with proceeds to be used for general working
capital purposes.
- In addition, the Company reached an agreement with its primary lender
to convert its $2 million bridge facility into a credit facility upon
closing of the convertible debenture financing.
- Net loss for the three and six months ended June 30, 2009 amounted to
$2,029,881 ($0.12 per share) and $3,615,062 ($0.21 per share)
respectively compared to $1,966,059 ($0.13 per share) and $3,886,747
($0.25 per share) respectively for the three and six months ended
June 30, 2008.
- Decreased stock-based compensation, salaries & benefits and general &
administration expenses were partially offset by increased
transportation and logistics, interest & other expenses and decreased
capitalized salaries & benefit expenses for both periods.
- Capital upgrades made to the processing plant were finalized and
commissioned during the second quarter ended June 30, 2009. The
Company generated commercial production in the quarter with
improvements to the effectiveness and efficiency of operations. These
improvements allowed the Company to replenish inventory levels to
continue sales and temporarily shut down the plant late in the
quarter. A summary of financial results is presented below:
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Income Statement For the Three Months For the Six Months
Summary Ended Ended
-------------------------------------------------------------------------
June 30, June 30, June 30, June 30,
2009 2008 2009 2008
$ $ $ $
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Product Sales 149,679 Nil 251,110 Nil
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Interest and
miscellaneous income 26,865 40,820 66,293 89,449
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Expenses 2,046,327 2,006,879 3,680,033 3,976,196
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Non-cash stock based
compensation expense
(included above) 362,513 629,010 694,935 1,258,020
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Net loss and comprehensive
loss 2,029,881 1,966,059 3,615,062 3,886,747
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Net loss per share 0.12 0.13 0.21 0.25
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Balance Sheet Summary As at As at
June 30, December 31,
2009 2008
$ $
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Working capital (2,466,484) 1,892,302
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Total assets 71,292,472 70,718,171
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Shareholder equity 64,246,719 67,052,501
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About Whitemud Resources
Whitemud Resources Inc. (www.whitemudresources.com) is a Canadian-based corporation that is exploiting a large kaolin deposit in southern Saskatchewan. The Company produces Whitemud(MK), a high-reactivity, cement-grade metakaolin that enhances the performance of cement used in construction and in oil and gas wells. The Company is positioned to benefit from expanding North American infrastructure needs and growing environmental pressures.
The TSX Venture Exchange does not accept responsibility for the adequacy
or accuracy of this release.
Forward Looking Information
This press release may contain forward-looking statements which may include estimates, plans, expectations, opinions, forecasts, projections and guidance or other statements that are not statements of fact, including without limiting the generality of the foregoing, statements made with respect to the expectations of future sales growth, growth in secured silo space at concrete production plants and growth in the number of concrete plants that use Whitemud(MK) . There can be no assurance that the Corporation's efforts in this regard will be successful as it is subject to, among other things, the current economic conditions affecting the debt and equity markets. The statements are made in reliance on the assumption that debt and equity markets will not experience further volatility and that the Company has sufficient time to pursue a financing. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it cannot give any assurance that such expectations will prove to be correct. The Company's forward-looking statements are expressly qualified in their entirety by this cautionary statement. Unless otherwise required by applicable securities laws, the Company does not intend nor does it undertake any obligation to update or review any forward-looking statements to reflect subsequent information, events, results or circumstances or otherwise.
For further information on Whitemud, go to www.whitemudresources.com
For email alerts regarding Whitemud Resources, please go to Whitemud Resources Inc. - Email Alerts
Contacts
Burl Aycock
CEO
Whitemud Resources
Telephone: (403) 695-1012
Ron Love
Vice President
Finance and CFO
Whitemud Resources
Telephone: (403) 517-0040
Kelly Babichuk
President and COO
Whitemud Resources
Telephone: (403) 517-0040 |
