DENVER, May 12 /PRNewswire-FirstCall/ -- Vista Gold Corp. (Amex: VGZ;
TSX) announced today its financial results for the three months ended March
31, 2008, as filed on May 12, 2008 with the US Securities and Exchange
Commission and with the relevant securities commissions in Canada in the
Corporation's Quarterly Report on Form 10-Q. Vista reported a consolidated
net loss for the three-month period ended March 31, 2008, of US$1,851,000
or US$0.05 per share compared to a consolidated net loss of US$776,000 or
US$0.02 per share for the same period in 2007. The increase in the
consolidated loss of US$1,075,000 from the prior year is largely due to an
increase in corporate administration and investor relations costs of
US$569,000, an increase in interest expense of US$184,000 and, a decrease
in interest income of US$307,000.
Corporate administration and investor relations costs increased to
US$1,287,000 during the three-month period ended March 31, 2008, compared
to US$718,000 for the same period in 2007. The increase of US$569,000 is
primarily due to an increase in stock-based compensation expense of
US$203,000 compared to the prior period. This is due to an increase in the
number of options granted during the prior year and vesting over time as
compared to the prior period. Also contributing to the increase was an
increased activity level associated with the Paredones Amarillos Project
and the elimination of US$270,000 in the allocation of certain corporate
overhead expenses to Allied Nevada Gold Corp. ("Allied Nevada") following
completion of the Plan of Arrangement. Until May 10, 2007, Allied Nevada
had been a wholly-owned subsidiary of Vista. Since the completion on that
date of the Plan of Arrangement that resulted in, among other things, the
formation of Allied Nevada as a newly independent entity, Vista no longer
allocated overhead expenses to Allied Nevada.
Net cash used in operating activities was US$1,207,000 for the
three-month period ended March 31, 2008, compared to US$639,000 for the
same period in 2007. The increase of US$568,000 is the result of an
increase in our net loss from continuing operations of US$1,214,000, which
is offset by a decrease in cash used for accounts receivable of US$342,000
and a decrease in cash used for prepaids and other of US$185,000.
Net cash used in investing activities increased to US$18,113,000 for
the three-month period ended March 31, 2008, from US$1,936,000 for the same
period in 2007. The increase of US$16,177,000 is mostly the result of an
increase in the additions to plant and equipment of US$16,041,000 which is
made up of gold processing equipment which will be used at the Paredones
Amarillos Project. The aggregate purchase price was approximately
US$16,000,000 which included the costs of relocating the equipment to
Edmonton, Alberta, Canada. The purchase was finalized in April 2008 with
the completion of the relocation of the major equipment components to
Edmonton. There were no similar purchases during the 2007 period.
Net cash provided by financing activities increased to US$31,544,000
for the three-month period ended March 31, 2008, from US$984,000 for the
same period in 2007. This increase is primarily the result of the
completion of a brokered private placement on March 4, 2008 in which we
issued and sold US$30,000,000 in aggregate principal amount of senior
secured convertible notes. Proceeds to Vista after legal and other fees
were US$28,534,000. These funds provided by the notes are for the
development of the Paredones Amarillos Project and are secured by the
assets of Minera Paredones Amarillos S.A. de C.V. There were no similar
transactions during the 2007 period. Warrants exercised during the period
ended March 31, 2008 produced cash proceeds of US$2,941,000 as compared to
US$1,245,000 for the same period in 2007. Stock option exercises produced
cash of US$69,000 during the period ended March 31, 2008 as compared to
US$17,000 for the same period in 2007.
At March 31, 2008, our total assets were US$80,936,000 compared to
US$51,346,000 at December 31, 2007, representing an increase of
US$29,590,000. At March 31, 2008, we had working capital of US$37,078,000
compared to US$27,284,000 at December 31, 2007, representing an increase of
US$9,794,000. This increase relates to an increase in cash balances from
year end as a result of the completion of the brokered private placement as
discussed below.
The principal component of working capital at both March 31, 2008 and
December 31, 2007, is cash and cash equivalents of US$28,689,000 and
US$16,686,000, respectively. Other components include marketable securities
(March 31, 2008 -- US$9,057,000; December 31, 2007 -- US$10,882,000) and
other liquid assets (March 31, 2008 -- US$341,000; December 31, 2007 --
US$380,000).
On March 4, 2008, we completed a private placement in which we issued
and sold US$30,000,000 in aggregate principal amount of senior secured
convertible notes (the "Notes"). The Notes mature at face value on March 4,
2011 (the "Maturity Date"). The Notes pay interest of 10% per annum.
Interest is payable each year in two installments on June 15 and December
15 and the principal is payable on the Maturity Date.
The Notes are convertible at the holder's or issuer's discretion in
accordance with the terms of the Notes. The holder can convert all or part
of the debt at any time prior to the Maturity Date or the business day
immediately preceding the Redemption Date (as defined below) at a price of
US$6.00 per common share, subject to adjustment in certain circumstances.
The Redemption Date is the date that the Notes are redeemed in the event
that we redeem the Notes.
We can convert all, but not part, of the Notes after March 4, 2009, if
the weighted-average price of our shares as quoted on the American Stock
Exchange ("AMEX") has been equal to or greater than US$9.00 per share for
15 consecutive trading days. The notice of conversion must occur within 10
days of any such 15-day period and the share price must be equal to or
greater than US$9.00 on the date the notice is delivered. The conversion
price is US$6.00 per common share subject to adjustment in certain
circumstances.
The conversion price will be adjusted on March 4, 2009, being the first
anniversary of the issuance of the Notes, to the lesser of the current
conversion price or 120% of the 20-day weighted average price of the common
shares as quoted on AMEX. The conversion price can also be adjusted in
certain circumstances such as issuance of warrants, additional common
shares or distribution of assets. The conversion price shall not be
adjusted below US$4.80 per share.
We used approximately US$16,000,000 of the proceeds from the issuance
of the Notes towards the purchase of gold processing equipment to be used
at our Paredones Amarillos Project. The remaining balance of the funds
raised from the private placement must be used for costs associated with
the Paredones Amarillos Project.
The selected financial data including the results of operations for the
three-month period ended March 31, 2008 compared to 2007, and the financial
position as at March 31, 2008 compared to December 31, 2007 is summarized
in the following table:
Selected Financial Data Three Months Ended March 31,
2008 2007
U.S. $000's, except loss per share
Results of operations
Net loss $(1,851) $(776)
Basic and diluted loss per share (0.05) (0.02)
Net cash used in operations (1,207) (639)
Net cash used in investing activities (18,113) (1,936)
Net cash provided by financing activities 31,544 984
Financial position March 31, December 31,
2008 2007
Current assets $38,087 $27,948
Total assets 80,936 51,346
Current liabilities 1,009 664
Total liabilities 18,528 694
Shareholders' equity 62,408 50,652
Working capital 37,078 27,284
The Annual General Meeting of the Corporation's shareholders was held
on May 5, 2008. Re-elected to the Board of Directors for a one-year term
were John M. Clark, W. Durand Eppler, C. Thomas Ogryzlo, Tracy A.
Stevenson, Michael B. Richings and Frederick H. Earnest.
PricewaterhouseCoopers LLP was re-appointed independent auditor.
About Vista Gold Corp.
Since 2001, Vista has acquired a number of gold projects with the
expectation that higher gold prices would significantly increase their
value. Vista is undertaking programs to advance the Paredones Amarillos
Project, including the preparation of a definitive feasibility study and
the purchase of long delivery equipment items, so that construction can
begin during the second half of 2008. The results of a preliminary
assessment completed in 2007 on the Mt. Todd Project in Australia were
encouraging and additional technical studies are underway with a definitive
feasibility study planned for completion by mid-2009. Vista's other
holdings include the Guadalupe de los Reyes Project in Mexico, Yellow Pine
Project in Idaho, Awak Mas Project in Indonesia and Long Valley Project in
California.
Forward-Looking Statements
This press release contains forward-looking statements within the
meaning of the U.S. Securities Act of 1933 and U.S. Securities Exchange Act
of 1934 and forward-looking information within the meaning of Canadian
securities laws. All statements, other than statements of historical facts,
included in this press release that address activities, events or
developments that Vista expects or anticipates will or may occur in the
future, including such things as financial and operating results and
estimates; potential funding requirements and sources of capital; the
timing, performance and results of feasibility studies including the
ongoing bankable feasibility study for the Paredones Amarillos Project;
timing and receipt of required land use, environmental and other permits
for the Paredones Amarillos Project and timing for starting and completion
of drilling and testing programs at the Paredones Amarillos Project; plans
to confirm the validity of the Change of Land Use Permit for the Paredones
Amarillos Project and timing for confirmation of the status of this permit;
anticipated timing of commencement of construction and commencement of
production at the Paredones Amarillos Project; plans for evaluation of the
Mt. Todd Project including estimates of silver, copper and gold resources;
preliminary assessment results; results of drilling programs and prospects
for exploration and conversion of resources at the Mt. Todd Project and
plans for a feasibility study at the Mt. Todd Project; potential for gold
production at the Amayapampa gold project and timing for commencement of
production and timing and receipt of future payments in connection with the
disposal of the Amayapampa gold project; ongoing debt service requirements
for our outstanding convertible notes and potential redemption or
conversion of the notes; Vista's future business strategy; competitive
strengths; goals; operations; reserve and resource estimates; plans;
potential project development; future share price and valuation; future
gold prices; Vista's potential status as a producer including plans, timing
and targeted initial production levels; and other such matters are
forward-looking statements and forward-looking information. When used in
this press release, the words "estimate", "plan", "anticipate", "expect",
"intend", "believe" and similar expressions are intended to identify
forward-looking statements and forward-looking information. These
statements involve known and unknown risks, uncertainties and other factors
which may cause the actual results, performance or achievements of Vista to
be materially different from any future results, performance or
achievements expressed or implied by such statements. Such factors include,
among others, risks relating to delays and incurrence of additional costs
in connection with the feasibility study underway at our Paredones
Amarillos Project, including uncertainty relating to timing and receipt for
required governmental permits; uncertainty relating to timing and receipt
for confirmation of the validity of the Change of Land Use Permit for the
Paredones Amarillos Project, uncertainty of feasibility study results and
preliminary assessments and of estimates on which such results are based;
risks relating to delays in commencement and completion of construction at
the Paredones Amarillos Project and Mt. Todd Project; risks of significant
cost increases; risks of shortages of equipment or supplies; risks that
Vista's acquisition, exploration and property advancement efforts will not
be successful; risks relating to fluctuations in the price of gold; the
inherently hazardous nature of mining-related activities; uncertainties
concerning reserve and resource estimates; potential effects on Vista's
operations of environmental regulations in the countries in which it
operates; risks due to legal proceedings; risks relating to political and
economic instability in certain countries in which it operates; risks
related to repayment of debt; risks related to increased leverage; and
uncertainty of being able to raise capital on favorable terms or at all; as
well as those factors discussed in Vista's latest Annual Report on Form
10-K and Quarterly Report on Form 10-Q and other documents filed with the
U.S. Securities and Exchange Commission and Canadian securities
commissions. Although Vista has attempted to identify important factors
that could cause actual results to differ materially from those described
in forward-looking statements and forward-looking information, there may be
other factors that cause results not to be as anticipated, estimated or
intended. There can be no assurance that such statements will prove to be
accurate as actual results and future events could differ materially from
those anticipated in such statements. Except as required by law, Vista
assumes no obligation to publicly update any forward-looking statements or
forward-looking information, whether as a result of new information, future
events or otherwise.
For further information, please contact Connie Martinez at (720)
981-1185, or visit the Vista Gold Corp. website at http://www.vistagold.com
SOURCE Vista Gold Corp.
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Related links:
http://www.vistagold.com
CONTACT:
Connie Martinez of Vista Gold Corp.,
+1-720-981-1185
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