Aur Resources Inc. Reports Net Earnings of US$31.0 Million and Cash Flow From Operating Activities of US$64.3 Million in the Third Quarter of 2005.TORONTO Toronto (tərŏn`tō), city (1998 est pop. 2,400,000), provincial capital, S Ont., Canada, on Lake Ontario. Toronto is the largest city in Canada and since the 1970s has been one of the fastest-changing cities in North America, experiencing -- Aur Resources Aur Resources Inc. (TSX: AUR) is a Toronto, Ontario, Canada, based, international mining company active in the acquisition, exploration, development and mining of mineral properties. Inc. (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :AUR) - (All dollar amounts are expressed in United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. currency) Third Quarter 2005 Highlights - Net earnings of $31.0 million or $0.33 (CDN (Content Delivery Network) A system of distributed content on a large intranet or the public Internet in which copies of content are replicated and cached throughout the network. $0.40) per share. - Cash flow from operating activities of $64.3 million equal to $0.68 (CDN $0.82) per share. - Cash and working capital increased to $326.2 million and $320.0 million, respectively, as at September September: see month. 30, 2005. - Aur's cash per share increased to CDN$3.99 as at September 30, 2005. - Aur's share of copper production from the Louvicourt, Andacollo Andacollo is a city in the Coquimbo Region, Chile. It is located at around . and Quebrada Blanca Mines was 57.9 million pounds. - Dividends of $3.8 million (CDN$0.05 per share) paid to shareholders on July July: see month. 1, 2005. - Andacollo mine life extended to late 2010 and forecast copper production for the next five years increased 58% to 227 million pounds. Financial Highlights Operating revenues operating revenue Revenue from any regular source. Revenue from sales is adjusted for discounts and returns when calculating operating revenue. Compare other revenue. were $108.1 million in the third quarter of 2005, compared to $80.1 million for the same period in 2004. Net earnings were $31.0 million, equal to $0.33 per share for the quarter, a 50% increase over net earnings of $20.7 million or $0.22 per share for the same quarter last year. Cash flow from operating activities was $64.3 million, equal to $0.68 (CDN$0.82) per share, compared to $31.6 million or $0.34 per share in the third quarter of 2004. Aur's consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: cash position at September 30, 2005 increased by $49.3 million to $326.2 million from June June: see month. 30, 2005, and working capital increased by $32.5 million to $320.0 million. Aur's consolidated cash exceeded its $125 million senior note debt by $201.2 million at September 30, 2005. Operating revenues for the nine month period ended September 30, 2005 were $314.2 million, approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 32% higher than the $239.0 million in 2004. Net earnings were $100.8 million, equal to $1.06 (CDN$1.30) per share for the period, compared to $63.4 million or $0.67 per share, in 2004. Cash flow from operating activities was $160.5 million, equal to $1.69 (CDN$2.06) per share for the nine months ended September 30, 2005, compared to $106.2 million or $1.13 per share in 2004. Aur's consolidated cash position at September 30, 2005 was $326.2 million, an increase of 58%, or $119.7 million, from December December: see month. 31, 2004. Working capital at September 30, 2005 was $320.0 million, an increase of $98.4 million in 2005. Aur's realized copper price, including cathode sales premiums and quotational period adjustments, averaged $1.88 per pound and $1.71 per pound of copper sold in the third quarter and year to date, respectively, compared to the LME See London Metal Exchange. LME See London Metal Exchange (LME). average price for the quarter of $1.70 per pound and $1.57 per pound for the year to date. The following table summarizes Aur's Consolidated Statements of Operations for the periods ended September 30, 2005 and 2004.
Three months ended Nine months ended
September 30 September 30
($000's) ($000's)
-----------------------------------------------------
2005 2004 Change 2005 2004 Change
-------- -------- ------- --------- -------- --------
Mining revenues 108,097 80,139 27,958 314,246 238,996 75,250
Mining expenses (41,025) (37,030) (3,995) (124,380)(105,585) (18,795)
Depreciation &
amortization (8,172) (8,600) 428 (24,846) (27,815) 2,969
Mine closure &
site
restoration (1,588) (785) (803) (3,089) (1,842) (1,247)
Non-controlling
interests (12,153) (3,875) (8,278) (23,485) (12,109) (11,376)
-------- -------- ------- --------- -------- --------
Operating
earnings 45,159 29,849 15,310 138,446 91,645 46,801
Business
development (1,713) (641) (1,072) (4,354) (2,904) (1,450)
Administration (1,050) (1,658) 608 (4,833) (4,888) 55
Interest on
long-term debt (2,110) (2,110) - (6,328) (6,328) -
Stock-based
compensation (277) (96) (181) (1,141) (283) (858)
Taxes (9,110) (4,670) (4,440) (25,070) (14,319) (10,751)
Other 119 55 64 4,044 474 3,570
-------- -------- ------- --------- -------- --------
Net earnings 31,018 20,729 10,289 100,764 63,397 37,367
-------- -------- ------- --------- -------- --------
-------- -------- ------- --------- -------- --------
Basic earnings
per share 0.33 0.22 0.11 1.06 0.67 0.39
-------- -------- ------- --------- -------- --------
-------- -------- ------- --------- -------- --------
Metal Production and Sales Aur's share of metal production from the Louvicourt, Andacollo and Quebrada Blanca Mines in the third quarter of 2005 was 57.9 million pounds of copper, 0.8 million pounds of zinc zinc, metallic chemical element; symbol Zn; at. no. 30; at. wt. 65.38; m.p. 419.58°C;; b.p. 907°C;; sp. gr. 7.133 at 25°C;; valence +2. Zinc is a lustrous bluish-white metal. It is found in Group 12 of the periodic table. , 11,000 ounces of silver and 300 ounces of gold, compared to 54.7 million pounds of copper, 3.9 million pounds of zinc, 43,000 ounces of silver and 1,400 ounces of gold in the third quarter of 2004. Aur's share of copper production was 3.2 million pounds higher than the third quarter of 2004 due to higher ore ore, metal-bearing mineral mass that can be profitably mined. Nearly all rock deposits contain some metallic minerals, but in many cases the concentration of metal is too low to justify mining the ore. tonnage TONNAGE, mar. law. The capacity of a ship or vessel. 2. The act of congress of March 2, 1799, s. 64, 1 Story's L. U. S. 630, directs that to ascertain the tonnage of any ship or vessel, the surveyor, &c. mined at a higher grade at the Andacollo Mine and higher ore grade Ore grade is a measure that describes the concentration of a valuable natural material (such as metals or minerals) in its surrounding ore. Ore grade is used to assess the economic feasibility of a mining operation: the cost of extracting a natural material from its ore is directly at the Quebrada Blanca Mine, partially offset by less production from the Louvicourt Mine due to its closure in July. Mining revenues were $108.1 million in the third quarter of 2005; a $28.0 million increase over the same period in 2004, primarily due to a $0.50 per pound higher realized copper price. Copper sales were 0.8 million pounds higher in the third quarter of 2005 compared to the third quarter of 2004. Minesite cash operating costs operating costs npl → gastos mpl operacionales were $41.0 million in the third quarter of 2005, compared to $37.0 million in 2004. Aur's cash operating cost per pound of copper sold was $0.71 for the quarter, $0.10 per pound higher than in the third quarter of 2004. The higher unit operating costs resulted primarily from increased energy, acid, foreign exchange, labour and transportation costs. Aur's share of metal production from the Louvicourt, Andacollo and Quebrada Blanca Mines in the nine months ended September 30, 2005 was 179.7 million pounds of copper, 8.8 million pounds of zinc, 138,000 ounces of silver and 4,500 ounces of gold, compared to 172.7 million pounds of copper, 10.4 million pounds of zinc, 142,000 ounces of silver and 4,900 ounces of gold in 2004. Copper production to September 30, 2005 was 7.0 million pounds higher than in 2004. Mining revenues were $314.2 million for the year to date, an increase of 31% over the $239.0 million for the same period in 2004. Mining revenues were $75.3 million higher than in 2004 primarily due to a $0.34 per pound higher realized copper price and offset by $2.0 million less by-product by·prod·uct or by-prod·uct n. 1. Something produced in the making of something else. 2. A secondary result; a side effect. by-product Noun 1. credits due to the Louvicourt Mine closure in July. Higher copper sales, due to higher production, resulted in $8.3 million more revenue, while the higher copper price generated $66.4 million more revenue in 2005, compared to 2004. Minesite cash operating costs were $124.4 million to September 30, 2005, compared to $105.6 million in 2004. Aur's cash operating cost per pound of copper sold was $0.65 for the year to date, compared to $0.57 in 2004. The 6.2 million more pounds of copper sold to September 30, 2005 compared to the same period in 2004 added $3.8 million to mining expenses while the higher operating costs per pound of copper sold resulted primarily from higher unit costs for consumables and labour. The following tables present the calculation of cash operating costs per pound of copper sold, net of by-product credits, for the three months and nine months ended September 30, 2005 and 2004. Aur and the mining industry in general, utilize unit cost information to better understand costs and reporting period fluctuations. There are no industry standardized standardized pertaining to data that have been submitted to standardization procedures. standardized morbidity rate see morbidity rate. standardized mortality rate see mortality rate. measures used in calculating unit cash costs and this data is intended only to provide information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance Accordance is Bible Study Software for Macintosh developed by OakTree Software, Inc.[] As well as a standalone program, it is the base software packaged by Zondervan in their Bible Study suites for Macintosh. with GAAP GAAP See: Generally Accepted Accounting Principles GAAP See generally accepted accounting principles (GAAP). . The measures are not necessarily indicative indicative: see mood. of operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. or cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses as determined under GAAP.
Three months ended Three months ended
September 30, 2005 September 30, 2004
---------------------- ----------------------
$000's $/lb. $000's $/lb.
Mining expenses 41,025 0.72 37,030 0.66
By-products
credits included
in mining revenues
Zinc (385) (0.01) (1,677) (0.03)
Silver (71) (0.00) (293) (0.01)
Gold (116) (0.00) (590) (0.01)
---------- ----------- ---------- -----------
Net cash operating
costs 40,453 0.71 34,470 0.61
---------- ----------- ---------- -----------
---------- ----------- ---------- -----------
Copper sold
(000's lbs.) 57,075 56,344
---------- ----------
---------- ----------
Nine months ended Nine months ended
September 30, 2005 September 30, 2004
---------------------- ----------------------
$000's $/lb. $000's $/lb.
Mining expenses 124,380 0.70 105,585 0.61
By-products
credits included
in mining revenues
Zinc (5,312) (0.03) (4,748) (0.03)
Silver (967) (0.01) (912) (0.00)
Gold (1,896) (0.01) (1,963) (0.01)
---------- ----------- ---------- -----------
Net cash
operating costs 116,205 0.65 97,962 0.57
---------- ----------- ---------- -----------
---------- ----------- ---------- -----------
Copper sold
(000's lbs.) 178,807 172,644
---------- ----------
---------- ----------
The following table summarizes mine operating earnings (1) for the
periods ended September 30, 2005 and 2004.
Three months ended Nine months ended
September 30 September 30
($000's) ($000's)
------------------------ -------------------------
2005 2004 Change 2005 2004 Change
------- ------- -------- ------- -------- --------
Louvicourt 944 4,697 (3,753) 14,236 14,946 (710)
Andacollo 16,708 8,948 7,760 41,578 27,288 14,290
Quebrada Blanca 49,420 29,464 19,956 134,052 91,177 42,875
------- ------- -------- ------- -------- --------
67,072 43,109 23,963 189,866 133,411 56,455
------- ------- -------- ------- -------- --------
------- ------- -------- ------- -------- --------
(1) Mine operating earnings equals mining operating revenues less
mining operating expenses.
Cash flow from mine operating activities was $69.0 million in the third quarter of 2005 and $177.4 million for the year to date, compared to $37.4 million and $121.6 million, respectively, for the same periods last year. Louvicourt Mine After almost 11 years of production, the last 3,000 tonnes of ore was processed through the mill on July 12, 2005 and the Louvicourt Mine ceased operation. Decommissioning Decommissioning is a general term for a formal process to remove something from operational status. Some specific instances include:
A claim for the right to return or the right to demand the return of a security that has been previously accepted as a result of bad delivery or other irregularities in the delivery and settlement process. work is now in progress. Comparison of 2005 operating and financial information to 2004 is not considered meaningful due to the Mine closure on July 12, 2005. The Louvicourt Mine produced 1.1 million pounds of copper and 2.8 million pounds of zinc from 51,066 tonnes of ore milled during the third quarter of 2005. Aur's share of Louvicourt's revenues was $1.8 million in the third quarter of 2005. As a consequence of mining lower grade, but still economic, reserves at the higher realizable copper prices, low grade ore was processed in the period, resulting in costs of $0.91 per pound of copper sold for the quarter, net of by-product credits. Working capital at September 30, 2005 was $4.8 million, the majority of which is expected to be realized during the remainder of 2005. Aur's cash flow from Louvicourt's operating activities was $6.8 million in the third quarter of 2005. Louvicourt produced 38.0 million pounds of copper and 29.5 million pounds of zinc from 819,920 tonnes of ore milled during the nine months ended September 30, 2005. Mill throughput The speed with which a computer processes data. It is a combination of internal processing speed, peripheral speeds (I/O) and the efficiency of the operating system and other system software all working together. 1. was 276,920 tonnes higher than planned and copper and zinc production were 8.8 million pounds and 10.0 million pounds, respectively, higher than planned for 2005 due principally to higher metal prices which allowed the profitable mining of lower grade ore not in the mine plan. Aur's share of Louvicourt's revenues was $27.3 million for the year to date. Cash operating costs were $0.43 per pound of copper sold, net of by-product credits. Aur's 30% of the cash flow from operating activities was $16.4 million in the first nine months of 2005. Andacollo Mine The Andacollo Mine produced 13.2 million pounds of LME registered Grade A cathode copper during the third quarter of 2005, 2.7 million more than the third quarter of 2004. Production was 1.2 million pounds higher than budgeted. A total of 4.6 million tonnes of rock, of which 1.0 million tonnes was ore, was mined at a strip ratio of 3.7:1. A total of 3.8 million tonnes of rock, of which 0.7 million tonnes was ore, was mined at a strip ratio of 4.7:1 in the third quarter of 2004. Andacollo's revenues of $24.8 million, generated from the sale of 13.2 million pounds of copper in the third quarter of 2005, were $9.6 million higher than the revenues of $15.2 million in the third quarter of 2004 as a result of higher copper prices and sales volumes. Cash operating costs were $8.1 million, $1.8 million higher than for the same period in 2004 principally due to the higher tonnage of ore mined and copper produced, higher energy and labour costs and the negative impact of a strong Chilean peso versus the United States dollar. The cash operating costs in the third quarter of 2005 were $0.61 per pound of copper sold, $0.04 per pound higher than in 2004. Cash flow from operating activities was $17.2 million in the third quarter of 2005, compared to $8.0 million in 2004. Expenditures on property, plant and equipment were $2.7 million in the third quarter compared to $0.6 million in 2004. Andacollo produced 38.4 million pounds of LME registered Grade A cathode copper during the nine months ended September 30, 2005, 5.0 million pounds more than in 2004. A total of 14.1 million tonnes of rock, of which 3.1 million tonnes was ore, was mined at a strip ratio of 3.5:1. A total of 11.4 million tonnes of rock, of which 2.4 million tonnes was ore, was mined at a strip ratio of 3.8:1 in 2004. Andacollo's revenues of $65.7 million, generated from the sale of 38.3 million pounds of copper in the nine months ended September 30, 2005, were $21.0 million higher than the revenues of $44.7 million in 2004, primarily as a result of higher realized copper prices and higher copper sales. Cash operating costs were $24.1 million, due to 5.2 million pounds more copper sold and higher energy and labour costs. The cash operating costs for the year to date were $0.63 per pound of copper sold, $0.10 per pound higher than in 2004 for the same reasons as in the third quarter. Cash flow from operating activities was $43.0 million in the year to date, compared to $24.4 million in 2004. Expenditures on property, plant and equipment were $3.7 million for the year to date, compared to $2.5 million in 2004. On October October: see month. 3, 2005, Aur announced an increase in leachable reserves at Andacollo of 17.2 million tonnes to 32.3 million tonnes grading 0.58% Cu. A new mine plan based upon these reserves has been prepared which will extend the mine life until late 2010 and increase the remaining copper production by 83.4 million pounds, or 58%, to 227.4 million pounds. The construction of a dump leach leach v. leached, leach·ing, leach·es v.tr. 1. To remove soluble or other constituents from by the action of a percolating liquid. 2. facility and a small heap leach pad expansion will be carried out at a capital cost of $4.5 million and $0.9 million, respectively, in order to achieve the increased copper production. The final feasibility study The analysis of a problem to determine if it can be solved effectively. The operational (will it work?), economical (costs and benefits) and technical (can it be built?) aspects are part of the study. Results of the study determine whether the solution should be implemented. for the Andacollo hypogene hy·po·gene adj. Formed or situated below the earth's surface. Used of rocks. copper deposit is progressing well and remains on schedule for completion in the first quarter of 2006. The Andacollo Mine is now expected to produce 52 million pounds of copper at a cash operating cost of $0.61 per pound of copper sold in 2005. At an average copper price of $1.75 per pound in the fourth quarter of 2005, Andacollo's cash flow from operating activities is expected to be approximately $60 million. Quebrada Blanca Mine The Quebrada Blanca Mine produced 44.4 million pounds of LME registered Grade A cathode copper in the third quarter of 2005, compared to 42.8 million pounds in the second quarter of 2005 and 39.4 million pounds in the third quarter of 2004. A total of 9.1 million tonnes of rock, of which 1.9 million tonnes was heap leach ore and 3.0 million tonnes was dump leach ore, was mined at a strip ratio of 0.9:1 in the third quarter of 2005, compared to 9.0 million tonnes of rock, of which 1.9 million tonnes was heap leach ore and 2.7 million tonnes was dump leach ore, at a strip ratio of 1.0:1 for the third quarter 2004. Quebrada Blanca's revenues, generated from the sale of 43.5 million pounds of copper, were $81.5 million in the third quarter of 2005, compared to $55.7 million generated from the sale of 40.5 million pounds of copper in 2004. The $25.8 million increase in revenues was due to a higher realized copper price and the higher sales volumes. Cash operating costs of $32.1 million were $5.9 million higher than in the same period in 2004. Cash operating costs were $0.74 per pound of copper sold, $0.09 per pound higher than in the third quarter of 2004 due to significantly higher energy, acid, labour and transportation costs and the negative impact of the strong Chilean peso versus the United States dollar. Cash flow from operating activities was $45.0 million in the third quarter of 2005 compared to $24.6 million in 2004. Expenditures on property, plant and equipment were $0.2 million in the third quarter, compared to $0.4 million in 2004. Quebrada Blanca produced 129.8 million pounds of LME registered Grade A copper in the nine months ended September 30, 2005, compared to 123.2 million pounds produced in 2004. A total of 27.6 million tonnes of rock, of which 5.6 million tonnes was heap leach ore and 9.4 million tonnes was dump leach ore, was mined at a strip ratio of 0.8:1 to September 30, 2005. A total of 25.6 million tonnes of rock, of which 5.3 million tonnes was heap leach ore and 5.7 million tonnes was dump leach ore, was mined at a strip ratio of 1.3:1 in 2004. Quebrada Blanca's revenues, generated from the sale of 129.1 million pounds of copper, were $221.3 million in the nine months ended September 30, 2005, compared to $165.1 million generated from the sale of 123.5 million pounds of copper in 2004. The $56.2 million revenue increase was due to higher realized copper prices and higher sales volumes. Cash operating costs were $87.2 million, $13.4 million higher than in 2004. Cash operating costs were $0.68 per pound of copper sold in the first nine months of 2005, $0.08 per pound higher than last year, for the same reasons as in the third quarter. Cash flow from operating activities in the nine months ended September 30, 2005 was $118.0 million, compared to $85.6 million in 2004. Expenditures on property, plant and equipment were $0.5 million compared to $1.1 million in 2004. The Quebrada Blanca Mine is expected to produce 176 million pounds of copper at a cash operating cost of $0.69 per pound of copper sold in 2005. At an average copper price of $1.75 per pound in the fourth quarter of 2005, Quebrada Blanca's operating cash flow Operating cash flow Earnings before depreciation minus taxes. Measures the cash generated from operations, not counting capital spending or working capital requirements. is expected to be approximately $170 million. Development Projects Duck Pond A duck pond is a pond for ducks and other water birds. Often such ponds are artificial and ornamental in nature, in public parks for example. Sometimes they may be less ornamental, in a farmyard for example. Some duck ponds are purposefully built for the shooting of duck. - Newfoundland Newfoundland, breed of dog Newfoundland, breed of massive, powerful working dog developed in Newfoundland, probably in the 17th cent., and later perfected in England. It stands from 25 to 28 in. (63.5–71. Development of the Duck Pond copper-zinc deposit is progressing well and remains on schedule for production in the fourth quarter of 2006. The ramp has advanced to over 700 metres, construction of the surface facilities, including the mill, is fully activated activated a state of being more than usually active. In biological systems this is usually brought about by chemical or electrical means. Commonly said of pharmaceutical and chemical products. and the power line is expected to be energized in December. Most of the key senior operating staff are on site and the total manpower, including contractors, is 130 people. Capital expenditures were $9.9 million in the third quarter and at year end are expected to total $33 million (CDN$39 million). Other Financial Information Business Development Aur's expenditures on its exploration projects and the identification and evaluation of acquisitions were $1.7 million and $4.4 million in the third quarter and in the year to date, respectively. Four copper projects in Chile Chile (chĭl`ē, Span. chē`lā), officially Republic of Chile, republic (2005 est. pop. 15,981,000), 292,256 sq mi (756,945 sq km), S South America, west of the continental divide of the Andes Mts. are at the drilling stage with drilling now in progress on the Montoya Montoya is an Hispanic surname. The name may refer to: Persons:
v. sus·pend·ed, sus·pend·ing, sus·pends v.tr. 1. To bar for a period from a privilege, office, or position, usually as a punishment: suspend a student from school. . The search for development stage deposits and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. producing mines which will meet Aur's investment criteria criteria (krītēr´ē  ),n. continues and includes Africa, Eastern Europe Eastern Europe The countries of eastern Europe, especially those that were allied with the USSR in the Warsaw Pact, which was established in 1955 and dissolved in 1991. and CIS countries There are two lists concerning CIS countries:
See America. . A number of assets have been identified and are under evaluation. Administration Administration expenses were $1.1 million and $4.8 million in the third quarter and in the year to date, respectively, compared to $1.7 million and $4.9 million, respectively, in 2004. These expenses are expected to be $6.2 million for the year. Depreciation and amortization Depreciation and amortization expenses were $8.2 million and $24.8 million in the third quarter and in the year to date, respectively, compared to $8.6 million and $27.8 million, respectively, in 2004. These expenses are expected to be $32.7 million for the year. Mine closure and site restoration Non-cash mine closure and site-restoration expenses were $1.6 million and $3.1 million in the third quarter and in the year to date, respectively, compared to $0.8 million and $1.8 million, respectively, in 2004. These expenses are expected to be $4.4 million for the year, of which $2.0 million will be cash expenditures for decommissioning and site restoration in progess at the Louvicourt Mine which closed on July 12, 2005. Interest on long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. Interest expense on Aur's $125 million senior notes debt was $2.1 million and $6.3 million in the third quarter and in the year to date, respectively, in both 2005 and 2004, and will be $8.4 million for the year. Stock-based compensation Stock-based compensation expense was $0.3 million and $1.1 million in the third quarter and in the year to date, respectively, compared to $0.1 million and $0.3 million, respectively, in 2004. Based upon options granted during the period January January: see month. 1, 2003 to September 30, 2005, stock-based compensation expense for the year will total $1.6 million in 2005 for the options granted during the period January 1, 2003 to September 30, 2005. Other expenses (revenues) The net amount of other expenses and revenues was positive $0.1 million and 4.0 million in the third quarter and in the year to date, respectively, compared to positive $0.1 million and $0.5 million, respectively, in 2004. Net revenues in the third quarter were primarily due to interest income of $2.6 million, a gain on the sale of property, plant and equipment of $0.4 million, partially offset by a $2.1 million copper price participation amount expected to be payable to ENAMI ENAMI Empresa Nacional de Mineria (National Mining Company; Chile) by Quebrada Blanca, and interest and financing costs of $0.6 million. For the year to date, net revenues consisted primarily of interest income of $6.1 million, a gain on the sale of marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has of $1.8 million and a gain on the sale of property, plant and equipment of $0.5 million. The net amount of other expenses and revenues is forecast to be positive $4.1 million for the year, primarily due to interest income earned on Aur's substantial cash balances, offset by an expected copper price participation expense, payable to ENAMI, of $4.7 million. Provision for income and resource taxes Provision for taxes was $9.1 million in the third quarter and $25.1 million for the year to date, respectively, compared to $4.7 million and $14.3 million, respectively, in 2004. Year to date cash taxes totalled $20.0 million, of which $18.1 million related to Quebrada Blanca and $1.9 million related to Quebec Quebec, city, Canada Quebec, Fr. Québec, city (1991 pop. 167,517), provincial capital, S Que., Canada, at the confluence of the St. Lawrence and St. Charles rivers. mining duties on Aur's share of Louvicourt's income, while non-cash future taxes totalled $5.1 million. Cash taxes totalled $2.6 million in 2004. The higher tax expense in 2005 is a result of higher earnings. At an LME average copper price of $1.75 per pound for the balance of 2005, the provision for taxes is expected to be $28.0 million for cash taxes and $6.0 million for future taxes in 2005. Non-controlling interests Non-controlling interests expense, related to the interests of Aur's partners in the Andacollo and Quebrada Blanca Mines, was $12.2 million and $23.5 million in the third quarter and in the year to date, respectively, compared to $3.9 million and $12.1 million, respectively, in 2004. Cash payments to non-controlling interests totalled $3.6 million for the year to date compared to $10.3 million for the same period in 2004. As the debt obligations of both Andacollo and Quebrada Blanca were fully repaid in the second quarter of 2005, Aur no longer has preferential pref·er·en·tial adj. 1. Of, relating to, or giving advantage or preference: preferential treatment. 2. rights with respect to cash flow from these mines, its entitlement An individual's right to receive a value or benefit provided by law. Commonly recognized entitlements are benefits, such as those provided by Social Security or Workers' Compensation. now being the right to receive 76.5% and 63% of Quebrada Blanca's and Andacollo's future cash distributions, respectively. As at September 30, 2005, the entitlement of the non-controlling interests to cash distributions was $24.6 million. A cash distribution of $32.6 million is presently forecast to be made to non-controlling interests in the Quebrada Blanca Mine in December 2005. Working capital Working capital increased $32.5 million during the third quarter to $320.0 million at September 30, 2005, primarily due to increased cash balances resources resulting from operating activities. Property, plant and equipment Investments in property, plant and equipment totalled $28.4 million in the nine months ended September 30, 2005, compared to $4.4 million in 2004. These investments included a $10.0 million accrual accrual, n continually recurring short-term liabilities. Examples are accrued wages, taxes, and interest. for the expected copper price participation amount payable to Teck Cominco Teck-Cominco TSX | TCK.B[1], NYSE: TCK) is a Canadian mining company. It was formed from the amalgamation of Teck and Cominco in 2001. Cominco started in 1906 as The Consolidated Mining and Smelting Company of Canada, formed by the amalgamation of several in January 2006 for 2005, relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the 2000 purchase of Quebrada Blanca, $14.1 million invested at Duck Pond, $3.7 million invested at Andacollo and $0.5 million invested at Quebrada Blanca. Aur anticipates that, in addition to the $10 million accrued ac·crue v. ac·crued, ac·cru·ing, ac·crues v.intr. 1. To come to one as a gain, addition, or increment: interest accruing in my savings account. 2. copper price participation, expenditures on property, plant and equipment in 2005 will be $27 (CDN$32.4) million at Duck Pond, $2.2 million at Quebrada Blanca and $6.9 million at Andacollo. 2005 Forecast Aur has used a copper price in the fourth quarter of $1.75 per pound in developing this 2005 forecast. In 2005, Aur expects its share of the 266 million pounds of copper production from the Louvicourt, Andacollo and Quebrada Blanca Mines to total approximately 192 million pounds together with by-product zinc, silver and gold. Cash operating costs per pound of copper sold, net of by-product credits, are forecast to average $0.66 per pound in 2005. Revenue is forecast to be approximately $425 million, including by-product credits. Mine operating costs are expected to be $166 million. Operating profit, after business development, administration and senior notes interest costs, is expected to be approximately $237 million. Net earnings, after other expenses including depreciation and amortization, non-cash mine closure expenses, income tax provision and non-controlling interests totalling $106 million, are forecast at approximately $131 million, equal to $1.38 or CDN$1.66 per share. Cash flow from operating activities is forecast to be approximately $230 million. Cash expenditures associated with financing activities are expected to total $49 million and are comprised of $12 million for dividends, $4 million for capital leases and $36 million to non-controlling interests, offset by revenues of $3 million, primarily from common share issuances. Cash expenditures on investing activities are expected to total $48 million in 2005, comprised of $33 million at Duck Pond, $9 million at the mines and $10 million to Teck Cominco for the 2004 copper price participation offset by $4.0 million of other proceeds on sale of marketable securities and disposal of property, plant and equipment. Aur's consolidated cash balance at December 31, 2005 is forecast to be $339 million, after the payment of $32.4 million of dividends to Quebrada Blanca non-controlling interests in December. Aur's share of the consolidated cash balances is forecast to be $321 million at December 31, 2005. Aur's sensitivity to copper price is such that a $0.10 per pound increase or decrease in the price of copper from $1.75 per pound, in the fourth quarter of 2005, would change the 2005 net earnings by $4 million and cash flow from operating activities by $5 million. This news release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. that are based on current expectations and which involve risks and uncertainties, including those referred to in Aur's 2004 Annual Report and/or in Aur's Annual Information Form dated March 31, 2005 and filed with Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. securities regulatory authorities Noun 1. regulatory authority - a governmental agency that regulates businesses in the public interest regulatory agency administrative body, administrative unit - a unit with administrative responsibilities , that could cause actual events or results to differ materially from estimated or anticipated events or results reflected in the forward-looking statements. Such forward-looking statements include statements regarding financial results and expectations for 2005 and include among other things, statements regarding targets, estimates and/or assumptions in respect of copper production and/or copper prices, cash operating costs, expenditures on property, plant and equipment, increases and decreases in production, reserves and/or resources and anticipated grades and recovery rates and are or may be based on assumptions and/or estimates related to future economic, market and other conditions. Factors that could cause actual results, developments or events to differ materially from those anticipated include, among others, the factors described or referred to elsewhere herein and/or in the AIF AIF Annual Information Form AIF Apoptosis-Inducing Factor AIF Agence Intergouvernementale de la Francophonie (French: Intergovernmental Agency for Francophony) AIF Australian Imperial Force and include unanticipated and/or unusual events. Many of such factors are beyond Aur's ability to control or predict. Actual results may differ materially from those anticipated. Readers are cautioned not to put undue reliance on forward-looking statements due to the inherent uncertainty therein. Aur disclaims any intent or obligation to update publicly any forward-looking statements, whether as a result of new information, future events or results or otherwise. Additional information, including the quarterly and annual Consolidated Financial Statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge , AIF, Management Information Circular Information Circular A document sent to shareholders outlining important matters to be discussed at the annual shareholders' meeting. Notes: Sent along with a proxy, the information circular may cover matters such as the election of the Board of Directors, possible and other disclosure documents, may also be examined and/or obtained through the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the by accessing Aur's website at www.aurresources.com or by accessing the Canadian System for Electronic Document Analysis and Retrieval The System for Electronic Document Analysis and Retrieval (SEDAR) is a mandatory document filing and retrieval system for Canadian public companies. Similar to EDGAR, SEDAR is operated by the Canadian Securities Administrators, a coordinating body comprising the 13 Canadian (SEDAR SEDAR System for Electronic Document Analysis and Retrieval SEDAR Southeast Data, Assessment, and Review ) website at www.sedar.com. Aur's third quarter analyst conference call will be held at 9:00 a.m., ET, on Thursday Thursday: see week. , October 27, 2005. This listen-only webcast can be accessed by going directly to CCN CCN Cloud Condensation Nuclei CCN Church Communication Network CCN Conseil Canadien des Normes (Standards Council of Canada) CCN Critical Care Nurse CCN Certified Clinical Nutritionist CCN Community Care Network CCN Cyclin Matthews Matthews may refer to: In places:
PRODUCTION STATISTICS
Three months ended September 30
---------------------------------------------------------------------
Quebrada
2005 Louvicourt Andacollo Blanca Total
---------------------------------------------------------------------
Ore (tonnes) 51,066 1,017,220 1,856,358 n/a
Grade
Copper (%) 1.03 0.86 1.21 n/a
Soluble copper (%) n/a 0.74 1.08 n/a
Zinc (%) 2.79 - - n/a
Gold (oz/t) 0.02 - - n/a
Silver (oz/t) 1.41 - - n/a
Copper (pounds)
Produced 321,000 13,211,000 44,372,000 57,904,000
Sold 321,000 13,222,000 43,532,000 57,075,000
Less:
non-controlling
interests - (4,892,500) (10,230,500) (15,123,000)
--------- ----------- ------------ ------------
Net to Aur 321,000 8,329,500 33,301,500 41,952,000
Inventory - 739,000 3,232,000 3,971,000
Other metals produced
and sold
Zinc (pounds) 825,000 - - 2,753,000
Gold (ounces) 300 - - 300
Silver (ounces) 11,000 - - 11,000
Cost per pound
of copper sold 0.91 0.61 0.74 0.71
---------------------------------------------------------------------
Quebrada
2004 Louvicourt Andacollo Blanca Total
---------------------------------------------------------------------
Ore (tonnes) 308,116 659,799 1,827,664 n/a
Grade
Copper (%) 2.45 0.79 1.21 n/a
Soluble copper (%) n/a 0.67 1.08 n/a
Zinc (%) 2.33 - - n/a
Gold (oz/t) 0.03 - - n/a
Silver (oz/t) 0.84 - - n/a
Copper (pounds)
Produced 4,815,000 10,462,000 39,393,000 54,670,000
Sold 4,815,000 11,016,000 40,513,000 56,344,000
Less:
non-controlling
interests - (3,305,000) (4,051,000) (7,356,000)
--------- ----------- ------------ ------------
Net to Aur 4,815,000 7,711,000 36,462,000 48,988,000
Inventory - 939,000 2,586,000 3,525,000
Other metals
produced and
sold
Zinc (pounds) 3,933,000 - - 3,933,000
Gold (ounces) 1,400 - - 1,400
Silver (ounces) 43,000 - - 43,000
Cost per pound
of copper sold $0.41 $0.57 $0.65 $0.61
---------------------------------------------------------------------
Notes: 1. Tonnes of ore milled at Louvicourt and stacked at Andacollo
and Quebrada Blanca and all metal production figures are
shown on a 100% basis with the exception of metal
production figures for Louvicourt, which represents Aur's
30% joint venture interest. Net copper to Aur represents
Aur's 30% beneficial interests in Louvicourt and its
respective beneficial interests in Andacollo and Quebrada
Blanca of 70% and 90% prior to June 30, 2005 and 63% and
76.5% thereafter. At Quebrada Blanca, the ore is material
stacked in the period and excludes 3,027,290 tonnes
(2004-2,708,430 tonnes) of dump leach ore.
2. Cash operating cost per pound of copper sold includes
smelting, refining, transportation and marketing costs,
settlement adjustments, provisional pricing, and is net of
by-product credits where applicable.
PRODUCTION STATISTICS
Nine months ended September 30
---------------------------------------------------------------------
Quebrada
2005 Louvicourt Andacollo Blanca Total
---------------------------------------------------------------------
Ore (tonnes) 819,920 3,100,683 5,524,067 n/a
Grade
Copper (%) 2.20 0.84 1.31 n/a
Soluble copper (%) n/a 0.72 1.10 n/a
Zinc (%) 1.85 - - n/a
Gold (oz/t) 0.03 - - n/a
Silver (oz/t) 0.95 - - n/a
Copper (pounds)
Produced 11,403,000 38,440,000 129,827,000 179,670,000
Sold 11,403,000 38,257,000 129,147,000 178,807,000
Less:
non-controlling
interests - (12,403,000) (18,792,000) (31,195,000)
--------- ----------- ------------ ------------
Net to Aur 11,403,000 25,854,000 110,355,000 147,612,000
Inventory - 739,000 3,232,000 3,971,000
Other metals produced
and sold
Zinc (pounds) 8,842,000 - - 8,842,000
Gold (ounces) 4,500 - - 4,500
Silver (ounces) 138,000 - - 138,000
Cost per pound
of copper sold 0.43 0.63 0.68 0.65
---------------------------------------------------------------------
Quebrada
2004 Louvicourt Andacollo Blanca Total
---------------------------------------------------------------------
Ore (tonnes) 910,935 2,356,992 5,247,671 n/a
Grade
Copper (%) 2.77 0.78 1.23 n/a
Soluble copper (%) n/a 0.67 1.08 n/a
Zinc (%) 2.05 - - n/a
Gold (oz/t) 0.03 - - n/a
Silver (oz/t) 0.88 - - n/a
Copper (pounds)
Produced 16,044,000 33,369,000 123,248,000 172,661,000
Sold 16,044,000 33,132,000 123,468,000 172,644,000
Less:
non-controlling
interests - (9,940,000) (12,347,000) (22,287,000)
---------------------------------------------------------------------
Net to Aur 16,044,000 23,192,000 111,121,000 150,357,000
Inventory - 939,000 2,586,000 3,525,000
Other metals produced
and sold
Zinc (pounds) 10,387,000 - - 10,387,000
Gold (ounces) 4,900 - - 4,900
Silver (ounces) 142,000 - - 142,000
Cost per pound
of copper sold $0.42 $0.53 $0.60 $0.57
---------------------------------------------------------------------
Notes: 1. Tonnes of ore milled at Louvicourt and stacked at Andacollo
and Quebrada Blanca and all metal production figures are
shown on a 100% basis with the exception of metal
production figures for Louvicourt, which represents Aur's
30% joint venture interest. Net copper to Aur represents
Aur's 30% beneficial interests in Louvicourt and its
respective beneficial interests in Andacollo and Quebrada
Blanca of 70% and 90% prior to June 30, 2005 and 63% and
76.5% thereafter. At Quebrada Blanca, the ore is material
stacked in the period and excludes 9,372,664 tonnes
(2004-5,725,669 tonnes) of dump leach ore.
2. Cash operating cost per pound of copper sold includes
smelting, refining, transportation and marketing costs,
settlement adjustments, provisional pricing, and is net of
by-product credits where applicable.
AUR RESOURCES INC.
UNAUDITED INTERIM CONSOLIDATED STATEMENTS
September 30, 2005
(Expressed in thousands of United States dollars)
These interim financial statements have not been audited or reviewed
by the Corporation's external auditors.
Consolidated Statements of Operations
(in thousands of United States
dollars Three months ended Nine months ended
except earnings per share) September 30 September 30
--------------------------------------
(Unaudited) 2005 2004 2005 2004
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $
Mining revenues 108,097 80,139 314,246 238,996
---------------------------------------------------------------------
Expenses
Mining 41,025 37,030 124,380 105,585
Business development 1,713 641 4,354 2,904
Administration 1,050 1,658 4,833 4,888
Depreciation and amortization 8,172 8,600 24,846 27,815
Mine closure and site
restoration 1,588 785 3,089 1,842
Interest on long-term debt 2,110 2,110 6,328 6,328
Stock-based compensation 277 96 1,141 283
Other expenses (revenues)
(note 7) (119) (55) (4,044) (474)
---------------------------------------------------------------------
55,816 50,865 164,927 149,171
---------------------------------------------------------------------
Earnings before taxes and
non-controlling interests 52,281 29,274 149,319 89,825
Income and resource taxes (9,110) (4,670) (25,070) (14,319)
---------------------------------------------------------------------
Earnings before
non-controlling interests 43,171 24,604 124,249 75,506
Non-controlling interests (12,153) (3,875) (23,485) (12,109)
---------------------------------------------------------------------
Net earnings for the period 31,018 20,729 100,764 63,397
---------------------------------------------------------------------
---------------------------------------------------------------------
Basic earnings per share
(note6(b)) 0.33 0.22 1.06 0.67
---------------------------------------------------------------------
---------------------------------------------------------------------
Diluted earnings per share
(note 6(b)) 0.32 0.22 1.05 0.67
---------------------------------------------------------------------
---------------------------------------------------------------------
Consolidated Statements of
Retained Earnings
(in thousands of United States
dollars) Three months ended Nine months ended
(Unaudited) September 30 September 30
--------------------------------------
2005 2004 2005 2004
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $
Retained earnings - beginning
of period 194,575 82,335 128,646 39,667
Net earnings for the period 31,018 20,729 100,764 63,397
Dividends on common shares - - (3,817) -
---------------------------------------------------------------------
Retained earnings - end of
period 225,593 103,064 225,593 103,064
---------------------------------------------------------------------
---------------------------------------------------------------------
See accompanying notes to interim consolidated financial statements.
Consolidated Segmented Information on Operations for the three months
ended September 30
(in thousands of United States dollars)
(Unaudited)
Quebrada
2005 Louvicourt Andacollo Blanca Corporate Total
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $ $
Mining revenues 1,807 24,800 81,490 - 108,097
---------------------------------------------------------------------
Expenses
Mining 863 8,092 32,070 - 41,025
Business development - - - 1,713 1,713
Administration - - - 1,050 1,050
Depreciation and
amortization - 2,245 5,838 89 8,172
Mine closure and site
restoration 249 179 1,160 - 1,588
Interest on long-term debt - - - 2,110 2,110
Stock-based compensation - - - 277 277
Other expenses
(revenues) (613) 93 2,391 (1,990) (119)
---------------------------------------------------------------------
499 10,609 41,459 3,249 55,816
---------------------------------------------------------------------
Earnings (loss)
before taxes 1,308 14,191 40,031 (3,249) 52,281
Income and resource
taxes 3,092 (2,133) (6,731) (3,338) (9,110)
---------------------------------------------------------------------
Earnings (loss) before
non-controlling
interests 4,400 12,058 33,300 (6,587) 43,171
Non-controlling interests - (4,461) (7,692) - (12,153)
---------------------------------------------------------------------
Net earnings (loss) 4,400 7,597 25,608 (6,587) 31,018
---------------------------------------------------------------------
---------------------------------------------------------------------
Quebrada
2004 Louvicourt Andacollo Blanca Corporate Total
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $ $
Mining revenues 9,230 15,246 55,663 - 80,139
---------------------------------------------------------------------
Expenses
Mining 4,533 6,298 26,199 - 37,030
Business development - - - 641 641
Administration - - - 1,658 1,658
Depreciation and
amortization 627 1,910 5,821 242 8,600
Mine closure and site
restoration 21 168 596 - 785
Interest on long-term debt - - - 2,110 2,110
Stock-based compensation - - - 96 96
Other expenses
(revenues) 54 113 457 (679) (55)
---------------------------------------------------------------------
5,235 8,489 33,073 4,068 50,865
---------------------------------------------------------------------
Earnings (loss) before
taxes 3,995 6,757 22,590 (4,068) 29,274
Income and resource
taxes (1,895) - (4,111) 1,336 (4,670)
---------------------------------------------------------------------
Earnings (loss) before
non-controlling
interests 2,100 6,757 18,479 (2,732) 24,604
Non-controlling interests - (2,027) (1,848) - (3,875)
---------------------------------------------------------------------
Net earnings (loss) 2,100 4,730 16,631 (2,732) 20,729
---------------------------------------------------------------------
---------------------------------------------------------------------
See accompanying notes to interim consolidated financial statements.
Consolidated Segmented Information on Operations for the nine months
ended September 30
(in thousands of United States dollars)
(Unaudited)
Quebrada
2005 Louvicourt Andacollo Blanca Corporate Total
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $ $
Mining revenues 27,263 65,687 221,296 - 314,246
---------------------------------------------------------------------
Expenses
Mining 13,027 24,109 87,244 - 124,380
Business development - - - 4,354 4,354
Administration - - - 4,833 4,833
Depreciation and
amortization 766 6,791 17,127 162 24,846
Mine closure and site
restoration 497 430 2,162 - 3,089
Interest on
long-term debt - - - 6,328 6,328
Stock-based compensation - - - 1,141 1,141
Other expenses
(revenues) (790) 441 2,818 (6,513) (4,044)
---------------------------------------------------------------------
13,500 31,771 109,351 10,305 164,927
---------------------------------------------------------------------
Earnings (loss)
before taxes 13,763 33,916 111,945 (10,305) 149,319
Income and
resource taxes (1,918) (3,873)(19,286) 7 (25,070)
---------------------------------------------------------------------
Earnings (loss) before
non-controlling
interests 11,845 30,043 92,659 (10,298) 124,249
Non-controlling interests - (9,857)(13,628) - (23,485)
---------------------------------------------------------------------
Net earnings (loss) 11,845 20,186 79,031 (10,298) 100,764
---------------------------------------------------------------------
---------------------------------------------------------------------
Quebrada
2004 Louvicourt Andacollo Blanca Corporate Total
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $ $
Mining revenues 29,247 44,679 165,070 - 238,996
---------------------------------------------------------------------
Expenses
Mining 14,301 17,391 73,893 - 105,585
Business development - - - 2,904 2,904
Administration - - - 4,888 4,888
Depreciation and
amortization 1,805 6,049 18,479 1,482 27,815
Mine closure and
site restoration 101 338 1,403 - 1,842
Interest on
long-term debt - - - 6,328 6,328
Stock-based compensation - - - 283 283
Other expenses
(revenues) (11) 63 221 (747) (474)
---------------------------------------------------------------------
16,196 23,841 93,996 15,138 149,171
---------------------------------------------------------------------
Earnings (loss)
before taxes 13,051 20,838 71,074 (15,138) 89,825
Income and
resource taxes (5,796) - (12,498) 3,975 (14,319)
---------------------------------------------------------------------
Earnings (loss)
before
non-controlling
interests 7,255 20,838 58,576 (11,163) 75,506
Non-controlling interests - (6,251) (5,858) - (12,109)
---------------------------------------------------------------------
Net earnings (loss) 7,255 14,587 52,718 (11,163) 63,397
---------------------------------------------------------------------
---------------------------------------------------------------------
See accompanying notes to interim consolidated financial statements.
As at
--------------------------------
Consolidated Balance Sheets September 30 December 31
(in thousands of United States dollars) 2005 2004
---------------------------------------------------------------------
---------------------------------------------------------------------
(Unaudited)
$ $
Assets
Current
Cash 326,201 206,520
Receivables 13,665 14,242
Inventories and prepaid
expenses (note 2) 59,956 52,750
---------------------------------------------------------------------
399,822 273,512
Property, plant and equipment 276,633 273,887
Future income and resource taxes 3,387 5,506
Long-term copper inventory and
other (note 3) 21,261 21,748
---------------------------------------------------------------------
701,103 574,653
---------------------------------------------------------------------
---------------------------------------------------------------------
Liabilities and Shareholders' Equity
Current
Accounts payable and accrued liabilities 37,176 28,290
Dividends payable - 7,849
Copper price participations (note 4) 13,061 10,000
Current portion of
non-controlling interests 24,646 -
Current portion of obligation
under capital leases 3,501 3,847
Current portion of mine
closure and site restoration 1,480 1,946
---------------------------------------------------------------------
79,864 51,932
---------------------------------------------------------------------
Senior notes (note 5) 125,000 125,000
Obligation under capital leases 6,459 8,952
Obligation on properties purchased 227 227
Future income and resource taxes 22,349 19,396
Mine closure and site restoration 25,870 23,025
Non-controlling interests 30,462 35,258
---------------------------------------------------------------------
210,367 211,858
---------------------------------------------------------------------
290,231 263,790
---------------------------------------------------------------------
Contingency (note 10)
Shareholders' equity
Share capital (note 6) 180,843 178,269
Contributed surplus -
stock-based compensation 1,848 707
Cumulative translation adjustment 2,588 3,241
Retained earnings 225,593 128,646
---------------------------------------------------------------------
410,872 310,863
---------------------------------------------------------------------
701,103 574,653
---------------------------------------------------------------------
---------------------------------------------------------------------
See accompanying notes to interim consolidated financial statements.
Consolidated Segmented Balance Sheet Information as at
(in thousands of United States dollars)
September 30, 2005 Quebrada
(Unaudited) Louvicourt Andacollo Blanca Corporate Total
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $ $
Assets
Current
Cash 1,019 27,261 114,878 183,043 326,201
Receivables 5,653 1,580 3,912 2,520 13,665
Inventories and prepaid
expenses 20 10,496 48,911 529 59,956
---------------------------------------------------------------------
6,692 39,337 167,701 186,092 399,822
Property, plant and
equipment - 30,351 223,597 22,685 276,633
Future income and
resource taxes - - - 3,387 3,387
Long-term copper
inventory and other - - 20,128 1,133 21,261
---------------------------------------------------------------------
6,692 69,688 411,426 213,297 701,103
---------------------------------------------------------------------
---------------------------------------------------------------------
Liabilities
Current
Accounts payable and
accrued liabilities 394 3,676 28,587 4,519 37,176
Copper price
participations - - 3,061 10,000 13,061
Current portion of
non-controlling
interests - - 24,646 - 24,646
Current portion of
obligation under
capital leases - 190 3,311 - 3,501
Current portion of
mine closure and
site restoration 1,480 - - - 1,480
---------------------------------------------------------------------
1,874 3,866 59,605 14,519 79,864
Senior notes - - - 125,000 125,000
Obligation under capital
leases - - 6,459 - 6,459
Obligation on properties
purchased - - - 227 227
Future income and
resource taxes - 1,754 20,595 - 22,349
Mine closure and site
restoration 1,183 4,909 19,037 741 25,870
Non-controlling
interests - 20,049 10,413 - 30,462
---------------------------------------------------------------------
3,057 30,578 116,109 140,487 290,231
---------------------------------------------------------------------
---------------------------------------------------------------------
Quebrada
December 31, 2004 Louvicourt Andacollo Blanca Corporate Total
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $ $
Assets
Current
Cash 461 981 10,988 194,090 206,520
Receivables 10,804 1,116 1,837 485 14,242
Inventories and
prepaid expenses 401 11,716 40,411 222 52,750
---------------------------------------------------------------------
11,666 13,813 53,236 194,797 273,512
Property, plant and
equipment 1,427 33,433 230,607 8,420 273,887
Future income and
resource taxes - 2,119 - 3,387 5,506
Long-term copper
inventory and other - - 20,426 1,322 21,748
---------------------------------------------------------------------
13,093 49,365 304,269 207,926 574,653
---------------------------------------------------------------------
---------------------------------------------------------------------
Liabilities
Current
Accounts payable and
accrued liabilities 1,629 2,567 16,264 7,830 28,290
Dividends payable - - - 7,849 7,849
Copper price
participation - - - 10,000 10,000
Current portion of
obligation under
capital leases - 368 3,479 - 3,847
Current portion of
mine closure and
site restoration 1,946 - - - 1,946
---------------------------------------------------------------------
3,575 2,935 19,743 25,679 51,932
Senior notes - - - 125,000 125,000
Obligation under
capital leases - - 8,952 - 8,952
Obligation on properties
purchased - - - 227 227
Future income and
resource taxes - - 19,396 - 19,396
Mine closure and site
restoration 1,141 4,424 16,743 717 23,025
Non-controlling
interests - 13,827 21,431 - 35,258
---------------------------------------------------------------------
4,716 21,186 86,265 151,623 263,790
---------------------------------------------------------------------
---------------------------------------------------------------------
See accompanying notes to interim consolidated financial statements.
Consolidated Statements
of Cash Flow
(in thousands of United Three months ended Nine months ended
States dollars) September 30 September 30
--------------------------------------
(Unaudited) 2005 2004 2005 2004
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $
Operating activities
Net earnings for the period 31,018 20,729 100,764 63,397
Non-cash items -
Depreciation and amortization 8,172 8,600 24,846 27,815
Future income and resource
taxes 1,546 3,298 5,071 11,663
Mine closure and site
restoration 815 785 2,154 1,842
Gain on sale of marketable
securities - (29) (1,804) (48)
Gain on disposal of property,
plant and equipment (377) (38) (522) (38)
Interest on obligation on
property purchased 8 13 26 387
Stock-based compensation 277 96 1,141 283
Copper price participation 2,074 - 3,062 -
Non-controlling interests 12,153 3,875 23,485 12,109
---------------------------------------------------------------------
55,686 37,329 158,223 117,410
Net change in non-cash working
capital items (note 8) 8,647 (5,768) 2,256 (11,182)
---------------------------------------------------------------------
64,333 31,561 160,479 106,228
---------------------------------------------------------------------
Financing activities
Dividends on common shares (3,817) - (11,773) -
Repayments of capital leases (865) (967) (2,841) (3,721)
Payments of non-controlling
interests - (2,280) (3,589) (10,297)
Common shares issued 881 69 2,574 892
Foreign exchange and other 584 (669) (171) (1,452)
---------------------------------------------------------------------
(3,217) (3,847) (15,800) (14,578)
---------------------------------------------------------------------
Investing activities
Payment of copper price
participation - - (10,000) -
Property, plant and equipment (8,420) (997) (9,868) (3,637)
Mineral property development (4,410) (321) (8,568) (741)
Principal payment on property
purchased - - - (2,250)
Proceeds on sale of marketable
securities - 32 2,213 94
Proceeds on disposal of
property, plant and equipment 1,061 38 1,225 38
---------------------------------------------------------------------
(11,769) (1,248) (24,998) (6,496)
---------------------------------------------------------------------
Increase in cash for the period 49,347 26,466 119,681 85,154
Cash - beginning of period 276,854 134,001 206,520 75,313
---------------------------------------------------------------------
Cash - end of period 326,201 160,467 326,201 160,467
---------------------------------------------------------------------
---------------------------------------------------------------------
See accompanying notes to interim consolidated financial statements.
Consolidated Segmented Information on Cash Flow for the three months
ended September 30
(in thousands of United States dollars)
(Unaudited)
Quebrada
2005 Louvicourt Andacollo Blanca Corporate Total
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $ $
Operating
activities
Net earnings
(loss) 4,400 7,597 25,608 (6,587) 31,018
Non-cash items (4,267) 9,019 16,177 3,739 24,668
---------------------------------------------------------------------
133 16,616 41,785 (2,848) 55,686
Net change in
non-cash working
capital items 6,667 549 3,264 (1,833) 8,647
---------------------------------------------------------------------
6,800 17,165 45,049 (4,681) 64,333
---------------------------------------------------------------------
Financing
activities
Repayments of
capital leases - - - (3,817) (3,817)
Payments of
non-controlling
interests - - (865) - (865)
Common shares
issued - - - 881 881
Foreign exchange
and other 297 (54) (216) 557 584
---------------------------------------------------------------------
297 (54) (1,081) (2,379) (3,217)
---------------------------------------------------------------------
Investing
activities
Property, plant
and equipment - (2,680) (178) (5,562) (8,420)
Mineral property
development - - - (4,410) (4,410)
Other 1,062 - - (1) 1,061
---------------------------------------------------------------------
1,062 (2,680) (178) (9,973) (11,769)
---------------------------------------------------------------------
Intersegment
distributions to
corporate (8,144) (90) 934 7,300 -
---------------------------------------------------------------------
Increase
(decrease) in
cash for the
period 15 14,341 44,724 (9,733) 49,347
Cash - beginning
of period 1,004 12,920 70,155 192,775 276,854
---------------------------------------------------------------------
Cash - end of
period 1,019 27,261 114,879 183,042 326,201
---------------------------------------------------------------------
---------------------------------------------------------------------
Quebrada
2004 Louvicourt Andacollo Blanca Corporate Total
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $ $
Operating
activities
Net earnings
(loss) 2,100 4,730 16,631 (2,732) 20,729
Non-cash items 1,963 4,112 11,563 (1,038) 16,600
---------------------------------------------------------------------
4,063 8,842 28,194 (3,770) 37,329
Net change in
non-cash working
capital items 693 (854) (3,580) (2,027) (5,768)
---------------------------------------------------------------------
4,756 7,988 24,614 (5,797) 31,561
---------------------------------------------------------------------
Financing
activities
Repayments of
capital leases - - (967) - (967)
Payments of
non-controlling
interests - (2,280) - - (2,280)
Common shares
issued - - - 69 69
Foreign exchange
and other - - (1,030) 361 (669)
---------------------------------------------------------------------
- (2,280) (1,997) 430 (3,847)
---------------------------------------------------------------------
Investing
activities
Property, plant
and equipment - (569) (402) (26) (997)
Mineral property
development - - - (321) (321)
Proceeds on
disposal of
property, plant
and equipment 32 - - 38 70
---------------------------------------------------------------------
32 (569) (402) (309) (1,248)
---------------------------------------------------------------------
Intersegment
distributions to
corporate (4,518) (5,353) (251) 10,122 -
---------------------------------------------------------------------
Increase
(decrease) in
cash for the
period 270 (214) 21,964 4,446 26,466
Cash - beginning
of period 286 1,630 10,125 121,960 134,001
---------------------------------------------------------------------
Cash - end of
period 556 1,416 32,089 126,406 160,467
---------------------------------------------------------------------
---------------------------------------------------------------------
See accompanying notes to interim consolidated financial statements.
Consolidated Segmented Information on Cash Flow for the nine months
ended September 30
(in thousands of United States dollars)
(Unaudited)
Quebrada
2005 Louvicourt Andacollo Blanca Corporate Total
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $ $
Operating
activities
Net earnings
(loss) 11,845 20,186 79,031 (10,298) 100,764
Non-cash items (195) 20,951 37,179 (476) 57,459
---------------------------------------------------------------------
11,650 41,137 116,210 (10,774) 158,223
Net change in
non-cash working
capital items 4,768 1,865 1,747 (6,124) 2,256
---------------------------------------------------------------------
16,418 43,002 117,957 (16,898) 160,479
---------------------------------------------------------------------
Financing
activities
Dividends on
common shares - - - (11,773) (11,773)
Repayments of
capital leases - (180) (2,661) - (2,841)
Payments of
non-controlling
interests - (3,589) - - (3,589)
Common shares
issued - - - 2,574 2,574
Foreign exchange
and other 266 (140) (558) 261 (171)
---------------------------------------------------------------------
266 (3,909) (3,219) (8,938) (15,800)
---------------------------------------------------------------------
Investing
activities
Payment of
copper price
participation - - - (10,000) (10,000)
Property, plant
and equipment - (3,743) (455) (5,670) (9,868)
Mineral property
development - - - (8,568) (8,568)
Other 1,225 - - 2,213 3,438
---------------------------------------------------------------------
1,225 (3,743) (455) (22,025) (24,998)
---------------------------------------------------------------------
Intersegment
distributions to
corporate (17,351) (9,070) (10,392) 36,813 -
---------------------------------------------------------------------
Increase
(decrease) in
cash for the
period 558 26,280 103,891 (11,048) 119,681
Cash - beginning
of period 461 981 10,988 194,090 206,520
---------------------------------------------------------------------
Cash - end of
period 1,019 27,261 114,879 183,042 326,201
---------------------------------------------------------------------
---------------------------------------------------------------------
Quebrada
2004 Louvicourt Andacollo Blanca Corporate Total
---------------------------------------------------------------------
---------------------------------------------------------------------
$ $ $ $ $
Operating
activities
Net earnings
(loss) 7,255 14,587 52,718 (11,163) 63,397
Non-cash items 5,906 12,638 37,401 (1,932) 54,013
---------------------------------------------------------------------
13,161 27,225 90,119 (13,095) 117,410
Net change in
non-cash working
capital items (1,515) (2,852) (4,528) (2,287) (11,182)
---------------------------------------------------------------------
11,646 24,373 85,591 (15,382) 106,228
---------------------------------------------------------------------
Financing
activities
Repayments of
capital leases - (1,276) (2,445) - (3,721)
Payments of
non-controlling
interests - (6,066) (4,231) - (10,297)
Common shares
issued - - - 892 892
Foreign exchange
and other - - (1,030) (422) (1,452)
---------------------------------------------------------------------
- (7,342) (7,706) 470 (14,578)
---------------------------------------------------------------------
Investing
activities
Property, plant
and equipment - (2,497) (1,064) (76) (3,637)
Mineral property
development - - - (741) (741)
Principal
payment on
property
purchased - - - (2,250) (2,250)
Proceeds on
disposal of
property, plant
and equipment 47 - 40 45 132
---------------------------------------------------------------------
47 (2,497) (1,024) (3,022) (6,496)
---------------------------------------------------------------------
Intersegment
distributions to
corporate (11,440) (14,323) (55,700) 81,463 -
---------------------------------------------------------------------
Increase in cash
for the period 253 211 21,161 63,529 85,154
Cash - beginning
of period 303 1,205 10,928 62,877 75,313
---------------------------------------------------------------------
Cash - end of
period 556 1,416 32,089 126,406 160,467
---------------------------------------------------------------------
---------------------------------------------------------------------
See accompanying notes to interim consolidated financial statements.
AUR RESOURCES INC.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
For the three and nine month periods ended September 30, 2005 and 2004
(in thousands of United States dollars except where otherwise noted)
(Unaudited)
1. Accounting policies The interim unaudited consolidated financial statements of Aur Resources Inc. ("Aur") have been prepared in accordance with accounting principles generally accepted in Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of using the same accounting policies as those disclosed dis·close tr.v. dis·closed, dis·clos·ing, dis·clos·es 1. To expose to view, as by removing a cover; uncover. 2. To make known (something heretofore kept secret). in note 1 to Aur's audited consolidated financial statements for the year ended December 31, 2004. These interim unaudited consolidated financial statements should be read in conjunction conjunction, in astronomy conjunction, in astronomy, alignment of two celestial bodies as seen from the earth. Conjunction of the moon and the planets is often determined by reference to the sun. with Aur's audited annual consolidated financial statements included in Aur's Annual Report for the year 2004.
2. Inventories and prepaid expenses
September 30 2005 December 31 2004
------------------ -----------------
$ $
Cathode copper 2,959 2,183
In-process inventories 42,141 38,375
Mine supplies 12,553 10,488
Prepaid expenses 2,303 1,704
------------------ -----------------
59,956 52,750
------------------ -----------------
------------------ -----------------
The amount of depreciation and amortization capitalized Capitalized Recorded in asset accounts and then depreciated or amortized, as is appropriate for expenditures for items with useful lives longer than one year. to cathode copper and in-process inventories at September 30, 2005 and December 31, 2004 was $6,304 and $6,587, respectively. The depreciation and amortization in the carrying value Carrying Value Also know as "book value," it is a company's total assets minus intangible assets and liabilities, such as debt. Notes: This is different than market value, as it can be higher or lower depending on the circumstances. of cathode copper and in-process inventories will be charged to the depreciation and amortization expense category of the statement of operations See Income statement. .
3. Long-term copper inventory and other
September 30 2005 December 31 2004
------------------ -----------------
$ $
Long-term in-process
copper inventory 18,747 18,747
Deferred financing cost 1,133 1,322
Other 1,381 1,679
------------------ -----------------
21,261 21,748
------------------ -----------------
------------------ -----------------
4. Copper price participations Teck Cominco Limited ("Teck Cominco") is entitled en·ti·tle tr.v. en·ti·tled, en·ti·tling, en·ti·tles 1. To give a name or title to. 2. To furnish with a right or claim to something: to a payment of up to $10,000 per year (or after 2006 or the repayment Repayment The act of paying back a debt. Notes: Everyone has to repay their debts eventually. See also: Debt, Defeasance, Loan of the senior notes, $2,500 quarterly) to a maximum of $40,000, should average yearly (or after 2006 or the repayment of the senior notes, quarterly) copper prices equal or exceed $1.22 per pound at December 31, 2004, adjusted for United States inflation until December 31, 2012. Included in current liabilities Current Liabilities Usually appearing on a company's balance sheet, it represents the amount owed for interest, accounts payable, short-term loans, expenses incurred but unpaid, and other debts due within one year. at December 31, 2004 was $10,000 pertaining per·tain intr.v. per·tained, per·tain·ing, per·tains 1. To have reference; relate: evidence that pertains to the accident. 2. to this commitment as the actual average copper price per pound for 2004 of $1.30 exceeded the inflation adjusted copper price. The $10,000 was paid on January 7, 2005. Based upon the actual average copper price for the nine months ended September 30, 2005 and the period end forward copper price for the balance of the year, the average copper price for 2005 is calculated to exceed the inflation adjusted copper price for 2005. Accordingly, an additional $10,000 liability to Teck Cominco has been accrued at September 30, 2005 with a corresponding increase in property, plant and equipment assets at Quebrada Blanca. ENAMI is also entitled to receive, under the by-laws BY-LAWS. Rules and ordinances made by a corporation for its own government. 2. The power to make by-laws is usually conferred by express terms of the charter creating the corporation, though, when not expressly granted, it is given by implication, and it is of Compania Minera Minera (Welsh: Mwynglawdd) is a small village in the county borough of Wrexham in north-east Wales. It borders Coedpoeth to the east and Bwlchgwyn to the west. Quebrada Blanca S.A., a per pound price participation in copper sales from the Quebrada Blanca Mine equal to 10% of the amount by which the average realized sales price per pound of copper sold by the Mine in any calendar year exceeds a specified spec·i·fy tr.v. spec·i·fied, spec·i·fy·ing, spec·i·fies 1. To state explicitly or in detail: specified the amount needed. 2. To include in a specification. 3. inflation adjusted indexed price for such year. Based upon the average realized copper price for the nine months ended September 30, 2005 and the period end forward LME copper price plus premiums for the balance of the year, the average realized sales price is expected to exceed the inflation adjusted copper price for the year. Accordingly, a $3.1 million liability to ENAMI has been accrued at September 30, 2005, representing the 2005 obligation to date, with a corresponding increase in the line item entitled "Other expenses (revenues)" on the Consolidated Statements of Operations. 5. Senior notes On March 10, 2003, Aur issued US$125,000 of senior unsecured Unsecured A loan or equity interest that is given without any guarantee of payment, performance, satisfaction or opportunity for return from the recipient. No property, interest or security is used as collateral in either a guarantee or a pledge. notes (the "Notes") to a number of U.S. insurance companies. The Notes bear interest at 6.75% per annum Per annum Yearly. , require semi-annual interest payments and are repayable re·pay v. re·paid , re·pay·ing, re·pays v.tr. 1. To pay back: repaid a debt. 2. at any time in whole or in part, subject to certain specified prepayment Prepayment 1. The payment of a debt obligation prior to its due date. 2. The excess payment over a scheduled debt repayment amount. Notes: 1. Examples include deferred expenses such as rent and early loan repayments. 2. premiums based on prevailing interest rates at the time of prepayment. 6. Share capital, earnings per share and stock-based compensation
(a) Issued and outstanding
2005 2004
------------------ ----------------
Shares Amount Shares Amount
-------- -------- -------- -------
# 000's $ # 000's $
Common shares
Balance - beginning of period 95,251 179,962 94,255 177,983
Share purchase options exercised 280 881 40 69
-------- -------- -------- -------
Balance - end of period 95,531 180,843 94,295 178,052
-------- -------- -------- -------
-------- -------- -------- -------
(b) Earnings per common share
Three months Nine months
ended September 30 ended September 30
--------------------------------------
2005 2004 2005 2004
--------------------------------------
$ $ $ $
(i) Basic
Numerator
Net earnings available to
shareholders 31,018 20,729 100,764 63,397
--------------------------------------
Denominator (# 000's)
Weighted average number of
shares 95,136 94,156 95,136 94,156
--------------------------------------
Basic earnings per share 0.33 0.22 1.06 0.67
--------------------------------------
--------------------------------------
Three months Nine months
ended September 30 ended September 30
------------------------------------------
2005 2004 2005 2004
------------------------------------------
$ $ $ $
(ii) Diluted
Numerator
Income available to
shareholders 31,018 20,729 100,764 63,397
------------------------------------------
Denominator (# 000's)
Weighted average number
of shares 95,136 94,156 95,136 94,156
Potential issuance
of shares from purchase
options 705 1,134 705 1,134
Potential incremental
issuance from stock-based
compensation 249 101 249 101
------------------------------------------
96,090 95,391 96,090 95,391
------------------------------------------
Diluted earnings per share 0.32 0.22 1.05 0.67
------------------------------------------
------------------------------------------
(c) Stock-based compensation plans At September 30, 2005, Aur had one stock-based compensation plan, a common share purchase option plan (the "Plan"), which is described below. Effective January 1, 2003, Aur adopted the recommendations of the CICA CICA Competition In Contracting Act of 1984 (USA) CICA Canadian Institute of Chartered Accountants CICA Competition In Contracting Act CICA Criminal Injuries Compensation Authority (UK) with respect to stock-based compensation and commenced to expense stock options granted since January 1, 2003 using the fair value method. The Plan is for directors, officers and senior management personnel of Aur. Options under the Plan are typically granted in such numbers as reflect the level of responsibility of the particular optionee n. 1. (Finance) A person who holds an option to buy or sell a financial instrument. See option. and his or her contribution to the business and activities of Aur. Options granted under the Plan typically have a five year term and are typically made cumulatively exercisable by the holders thereof as to a proportionate pro·por·tion·ate adj. Being in due proportion; proportional. tr.v. pro·por·tion·at·ed, pro·por·tion·at·ing, pro·por·tion·ates To make proportionate. part of the aggregate number of shares subject to the option over a specified term. Except in specified circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or , options are not assignable and terminate Terminate (terminat.exe) was a shareware modem terminal and host program for MS-DOS and compatible operating systems developed from the early to the late 1990s by the Dane Bo Bendtsen. The last release (5. upon the optionee ceasing to be employed by or associated with Aur. The terms of the Plan further provide that the price at which shares may be issued under the Plan cannot be less than the market price of the shares when the relevant options are granted. Aur's common shares are listed on the Toronto Stock Exchange Toronto Stock Exchange (TSE) Canada's largest stock exchange, trading approximately 1,200 company stocks and 33 options. and trade in Canadian dollars Noun 1. Canadian dollar - the basic unit of money in Canada; "the Canadian dollar has the image of loon on one side of the coin" loonie dollar - the basic monetary unit in many countries; equal to 100 cents ("CDN"). The following table summarizes information regarding Aur's outstanding and exercisable common share purchase options as at September 30, 2005:
Outstanding Exercisable
------------------------------------------- --------------
Weighted Weighted
Range of Weighted average average
exercise average exercise exercise
prices months price price
per share Shares remaining per share Shares per share
------------ ------- --------- --------- ------- -------------
CDN$ # 000's # CDN$ # 000's CDN$
1.96 to 2.55 226 4 2.11 221 2.10
3.30 to 3.91 539 28 3.57 350 3.63
4.10 to 5.90 370 36 5.29 200 4.89
6.11 to 8.05 2,035 53 6.65 567 6.49
------- -------
3,170 1,338
------- -------
------- -------
The number of stock options outstanding at September 30, 2005 represents 3.3% of Aur's issued and outstanding common shares. The following table summarizes information regarding Aur's common share purchase options as at and for the periods ended September 30, 2005:
Three months ended Nine months ended
----------------------------------------
Weighted Weighted
average average
exercise exercise
price price
Shares per share Shares per share
-------------------- -----------------
# 000's CDN$ # 000's CDN$
Balance - beginning of
period 3,001 5.23 2,465 3.55
Granted 450 7.17 1,835 6.68
Exercised (281) 3.74 (1,130) 2.77
---------- ---------
Balance - end of period 3,170 3,170
---------- ---------
---------- ---------
For purposes of stock-based compensation, the fair value of each option was estimated on the date of grant using the Black-Scholes option pricing model option pricing model A mathematical formula for determining the price at which an option should trade. The model expresses the value of an option as a function of the value of the underlying asset, length of time until maturity, exercise price, yields on with the following weighted average assumptions used for grants as follows: dividend yield of 1.1% (2004 - 0%), expected volatility Volatility 1. A statistical measure of the tendency of a market or security to rise or fall sharply within a period of time. 2. A variable in option pricing formulas that denotes the extent to which the return of the underlying asset will fluctuate between now and the of 43% (2004 - 44%), risk-free interest rate Risk-Free Interest Rate Describes return available to an investor in a security somehow guaranteed to produce that return. The risk-free interest rate compensataes the investor for the temporary sacrifice of consumption. of 3.5% (2004 - 2.6%) and expected life of 27 months (2004 - 36 months).
7. Other expenses (revenues)
Three months Nine months
ended September 30 ended September 30
--------------------------------------
2005 2004 2005 2004
--------------------------------------
$ $ $ $
Interest on obligation under
capital leases 125 195 410 585
Interest and other income (2,552) (1,014) (6,108) (2,138)
Interest and financing costs 16 30 549 489
Copper price participation 2,074 - 3,062 -
Foreign exchange 564 692 134 183
Gain on sale of marketable
securities - (38) (1,804) (38)
Gain on disposal of property,
plant and equipment (377) (29) (522) (48)
Miscellaneous 31 109 235 493
---------- ------- -------- -------
(119) (55) (4,044) (474)
---------- ------- -------- -------
---------- ------- -------- -------
8. Supplementary cash flow information
Three months Nine months
ended September 30 ended September 30
--------------------------------------
2005 2004 2005 2004
----------- ------ -------- -------
$ $ $ $
Net change in non-cash working
capital:
Receivables 4,639 (806) 577 (2,718)
Inventories and prepaid expenses (3,880) (1,176) (7,206) (2,709)
Accounts payable and accrued
liabilities 7,888 (3,786) 8,885 (5,755)
----------- ------ -------- -------
8,647 (5,768) 2,256 (11,182)
----------- ------ -------- -------
----------- ------ -------- -------
Other information:
Interest paid 4,219 4,219 8,438 8,439
Income, resource and capital
taxes paid 362 835 11,487 1,906
9. Fair value of financial instruments The carrying amount of cash, accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying and current liabilities approximate ap·prox·i·mate v. To bring together, as cut edges of tissue. adj. 1. Relating to the contact surfaces, either proximal or distal, of two adjacent teeth; proximate. 2. Close together. their fair value due to the short term maturities of these instruments. 10. Contingency contingency n. an event that might not occur. In 2003, the Chilean Internal Revenue Service (the "IRS An abbreviation for the Internal Revenue Service, a federal agency charged with the responsibility of administering and enforcing internal revenue laws. ") issued to CMQB a notice of reassessment Reassessment The process of re-determining the value of property or land for tax purposes. Notes: Property is usually reassessed on an annual basis. You may request a "reassessment" if you disagree with your assessment. in respect of the deduction deduction, in logic, form of inference such that the conclusion must be true if the premises are true. For example, if we know that all men have two legs and that John is a man, it is then logical to deduce that John has two legs. of certain components of guarantee fees owed to Aur and claimed as expenses by CMQB. CMQB contested such reassessment and, in August, 2005 the Iquique Iquique (ēkē`kā), city (1990 est. pop. 148,500), capital of Iquique prov., N Chile. A port on the Pacific, it exports nitrates and ore from the Atacama Desert. The city, founded in the 16th cent. Tax Court rendered a judgement confirming certain elements of the IRS reassessment. As a consequence of the foregoing, the IRS assessed CMQB with taxes of $1,900, including interest, penalties and inflation adjustment to date. The judgement also determined a reduction of CMQB's tax loss carry forwards in the amount of $17,500. CMQB has appealed such a judgement to the Court of Appeals. It is the opinion of management and CMQB's legal counsel that CMQB's income tax filings with respect to the guarantee fees are correct and that the payment of the guarantee fees should not attract withholding taxes The amount legally deducted from an employee's wages or salary by the employer, who uses it to prepay the charges imposed by the government on the employee's yearly earnings. . Should CMQB ultimately be unsuccessful in overturning the judgement of the Tax Court in the Court of Appeals, Aur would record a pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta charge to earnings equal to its proportionate share of the amount of reassessment, plus interest, penalties and inflation adjustment to the date of the Court of Appeals judgement. At this time, the outcome of the appeal and ultimate resolution of this reassessment cannot be determined and, accordingly, the loss, if any, has not been recorded in the consolidated financial statements. Aur Resources Inc. (TSX:AUR) |
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