May 14, 2010 09:08 ET
MDN Reports its Financial Results for the First Quarter
MONTREAL, QUEBEC–(Marketwire – May 14, 2010) – MDN Inc. (“MDN”) (TSX:MDN) is pleased to report that it filed its interim financial results today for the three month period ended March 31, 2010. The interim financial statements and management discussion and analysis can be found on the Company’s website (www.niobaymetals.com) and on SEDAR (www.sedar.com).
During the quarter, Serge Bureau was appointed as President and Chief Executive Officer and Director of the Company. Mr. Bureau has undertaken to engineer the Company’s growth by increasing the value of its assets through the acquisition of new gold properties and the discovery of new resources. MDN remains first and foremost a gold exploration company, and has allocated a budget of $4.5 million for 2010 to develop the Tulawaka mine and explore its properties.
The operator of the Tulawaka mine, African Barrick Gold, is forecasting production of 76,376 ounces of gold in 2010. MDN has a 30% interest in this property. Mr. Bureau and Mr. Marc Boisvert, VP Exploration for MDN, visited the Tulawaka mine in early April to assess the investments to which MDN is contributing to extend the underground developments of the mine, and to review the surface exploration program currently underway. A new gold-bearing zone, Mojamoja, has been identified about 4 km northwest of the Tulawaka plant, and the required exploration and definition drilling is currently in preparation for resource estimation work.
Finally, drill results on Ikungu, a zone of gold mineralization continuous over more than 2.5 km, returned multiple intersections grading over 5 g/t Au and up to 54.3 g/t Au. The mineralized zones located along the gold-bearing horizon will be tested for vertical continuity by the next drilling program, now in the planning stage and scheduled to begin early in the third quarter.
“The exploration results from Tulawaka and Ikungu are very encouraging and indicate that we are following the right strategy. We have also seen good interest from investors at targeted conferences like Indaba, the Montreal Mining Lunch, PDAC and the Electric Metals Conference, which have given us the opportunity to unveil MDN’s potential,” said Serge Bureau, President and Chief Executive Officer of MDN.
FIRST QUARTER HIGHLIGHTS
- Revenue of $58,611 compared to $1,915,619 for the same period in 2009, and a net loss of $821,792 or $0.008 per share;
- At March 31, 2010, MDN had $17.0 million in working capital, which ensures the continuity of its operations and investment plans;
- The Tulawaka gold mine produced 14,591 ounces of gold in the first quarter at an average grade of 4.09 g/t and a recovery rate of 93.6%. Given its 30% interest in the Tulawaka project, MDN’s pro-rata share is 4,377 ounces of gold. Despite a shortfall in gold production for the first quarter, MDN understands that African Barrick Gold remains confident that its will meet its gold production target for the year;
- Total cash costs to produce an ounce of gold were US $558 for the quarter compared to US $379 for the same period in 2009;
- MDN and the operator of the Tulawaka mine agreed to carry out an aggressive exploration program to extend the life of the Tulawaka mine. With a lower gold production, MDN’s 30 % royalties for the first quarter were fully used to fund the exploration program.
- The Scoping Study was completed for the Crevier niobium-tantalum project, in which MDN holds a 67.5% interest. Located in the Lac-Saint-Jean region, the project could have a significant economic impact on this area of Quebec, since the proposed open-pit mine has an 18-year mine life. With a proposed production of 4,000 tonnes per day (tpd) and at an estimated investment of $315.6 million, the project is expected to generate average annual revenues of $125 million and annual net operating cash flows of $57 million over the 18 year operating period, with production starting in 2013;
- The decision was made to proceed with the feasibility study, and the study is now underway. An update on the progress of the work will be issued in the second half of 2010.
|For the three months ended March 31, 2010||2010||2009|
|(thousands of dollars, except per share amounts)|
|Translation gain (loss)||$||(144)||$||284|
|Net earnings (loss)||$||(822)||$||794|
|Net earnings (loss) per share, basic and diluted||$||(0.008)||$||0.008|
|Weighted average number of shares outstanding (thousands)||95,376||95,325|
MDN Inc.(TSX:MDN) is a mining exploration and development company with adequate financial resources to develop its exploration projects in Québec and Tanzania. MDN also remains active in the search for new business opportunities that can increase shareholder value. In addition to its 30% participating interest in the Tulawaka gold mine, MDN is the operator and owner of a majority interest in mineral licenses totalling 715 km2 in the vicinity of the Tulawaka mine. MDN Inc. also owns a 67.5% interest in Crevier Minerals Inc. which owns a NI 43-101 niobium-tantalum resource in the Lac-Saint-Jean area of Québec. MDN has an option to increase its equity participation in Crevier Minerals Inc. to a maximum of 87.5%. Additional information is available on MDN’s website at www.niobaymetals.com.
Forward-Looking Statements All statements in this release, other than statements of historical fact, that address events or developments that the Company expects to occur, are forward-looking statements. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in the forward-looking statements. Factors that could cause the actual results to differ materially from those in forward-looking statements are discussed in greater detail in the Company’s most recent Annual Information Form filed on SEDAR, which also provides additional general assumptions in connection with these statements. Investors and others who base themselves on the Company’s forward-looking statements should carefully consider the factors mentioned in the Annual Information Form as well as the uncertainties they represent and the risk they entail. The Company believes that the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this press release should not be unduly relied upon. These statements speak only as of the date of this press release.
- MDN Inc.
Serge Bureau, Ing.
President and Chief Executive Officer
514-866-6500, Ext. 221
Marc Boisvert, Ing.
Vice President, Exploration
514-866-6500, Ext. 227
Sun International Communications