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NDT VENTURES LTD.
FEBRUARY 29, 2000
Options granted - Employee/Director Stock Options:
Date Type of
Security
Name Number Price per Share Expiry
************** None granted this quarter**********
>AS AT FEBRUARY 29, 2000
a) Authorized and issued share capital:
Authorized - 100,000,000 common shares without par value
Issued and fully paid - 25,538,743 shares $ 23,139,471
b) Summary of options, warrants and convertible securities outstanding
Type: Options or Warrants Number of shares Exercise Price per share Expiry Date
Employee/Directors Options 20,000 $ 0.38 10-May-2001
125,000 $ 0.38 27-October-2001
225,000 $ 0.38 30-January-2002
150,000 $ 0.38 2-February-2002
35,000 $ 0.38 2- April-2002
530,000 $0.15 11-April-2004
1,085,000
c) Shares in escrow or subject to pooling: Nil
d) List of Directors:
Donald A. McLeod Fred G. Hewett Neil Briggs Bruce Grant
D. Bruce McLeod James Stewart Donald Moore
Quarter Report To Shareholders
The Company continues to aggressively pursue mineral property acquisitions in South America with a priority focus on Peru.
The Company's strategy in Peru has been a proactive review of mineral properties with the objective of identifying significant opportunities for acquisition or joint venture. The Company has developed a network of Peruvian based exploration geologists and prospectors, who are assisting in the identification of properties of merit.
Once identified, NDT geologists assess and prioritize these highly prospective mineral properties.
Progress from this program has been steady and, as a result, the Company is in continued discussions with a private Lima based company to acquire a significant gold property.
As well, in October of 1999, the Company staked the Mazo Cruz property, which consists of 3,600 hectares located in the department of Puno in southern Peru. Initial wide-spaced sampling by the Company over the central portion of the alteration system has identified a plus 150 ppb gold anomaly exceeding one square kilometer. Also, veins on the property have returned values up to 5.1 g/t gold and 280 g/t silver. An exploration program for this property is currently being developed to follow-up on the known anomalies and to extend initial exploration, within the property position, along trend to the north and south. Field activities are expected to resume on the property following the on-going rainy season.
In addition to its recent activities in Peru and Argentina, the Company continues to review other opportunities in North and South America on a property specific basis.
Management Discussion & Analysis
Results of Operations: The Company sustained a net loss from operations of $513,273 during the nine month period ended February 29, 2000. This loss is higher than the loss in the 1999 comparative period by $207,176 (1999 loss - $306,097). The higher loss is explained by a reduction in income of $36,849 and an increase in expenses (primarily property examination costs) of $170,327.
With a lower cash and short term deposit balance, and a relatively weaker interest rate in 2000, interest earned for 2000 was $155,114 as compared to $191,853 in 1999, accounting for the reduction in income.
Since the appointment of Mr. Thomas Burkhart as Vice-President of Exploration in April 1999, the Company has undertaken an aggressive examination of precious metal prospects, primarily in South America. For the current nine month period just ended, the Company spent a total of $320,764 on such examinations, $204,792 higher than the 1999 comparative period. During the current period, the Company also wrote off certain resource costs totaling $62,280, as compared to $36,039 in 1999. Aside from the increase in these two categories of expenses, almost all other general and administrative expenses were lower in 2000 than in 1999. This reduction follows the implementation of a cost reduction program the Company commenced in late 1998 in anticipation of a continuing weak financial markets. Three significant factors accounted for the reduction in total expenses in 2000.
The first factor was management fees, which, pursuant to a management service agreement with International Northair Mines Ltd. ("Northair"), a company with certain directors and officers in common, totaled $114,000 in the current period, while in 1999, the total fees paid were $144,000. Secondly, office expenses in 1999 were $15,937, as compared to $31,723 in 1999. Lastly, legal and accounting was $15,714 lower than in 1999. Investor relations activities, which are carried out by the in-house staff of Northair, consisting of the dissemination of information to shareholders and prospective investors through brochures, quarterly reports, annual reports and press releases,
cost the Company a total of $72,368, as compared to $72,977 in 1999, a slight decrease from 1999. Included in these expenses are $16,336 of promotion and travel expenditures (1999 - $21,174).
Capital Resources and Liquidity: The Company's cash reserves decreased by $544,505 during the current period (1999 decrease in cash - $690,189), which resulted in an ending cash balance of $4,171,649 as at February 29, 2000. The reduction in cash reserves is attributable to spending on operating activities of $453,226 and $97,469 on resource property costs, offset by proceeds from sale of investments of $6,190. At February 29, 2000, the net working capital position of the Company is $4,163,355 (1999 - $4,774,167).
During 2000, the Company obtained certain exploration cost refunds of approximately $14,000 from the Newfoundland Government as a result of dropping various claims in the Voisey's Bay area. In August 1999, the Company acquired by staking two concessions in the Cordon de Esquel region of Chubut province, Argentina. The cost of this staking and an initial exploration program was $19,658 to February 29, 2000. In Peru, the Company expended $41,538 in acquisition costs and $18,228 in exploration on the Mazo Cruz properties. The Company is also actively examining other Peruvian properties and to February 29, 2000, expended $10,267 in this effort. After netting the Voisey's Bay recovery of costs from all other resource property costs, the net expenditures on resource properties amounted to $97,469.
The Company is in the exploration stage and therefore has no regular cash flow from operations. The
Company's historical capital needs have been satisfied by advances and equity subscriptions from both private investors (including members of management) and the public.
Outlook: The Company expects that its capital requirements arising from the evaluation of its mineral properties and future exploration commitments will be met from the Company's cash position, at least for the coming year. The Company continues to actively review a variety of advanced base metal and gold projects in Canada and elsewhere.
On Behalf of the Board of Directors,
Frederic G. Hewett, P.Eng.
President and Chief Executive Officer
April 7 th , 2000 |
