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NovaCopper Inc
Symbol NCQ
Shares Issued 104,979,820
Close 2016-04-06 C$ 0.47
Market Cap C$ 49,340,515
Recent Sedar Documents

NovaCopper talks Arctic 2016 spending in Q1 results NR

2016-04-07 07:35 ET - News Release

Mr. Rick Van Nieuwenhuyse reports

NOVACOPPER ANNOUNCES FIRST QUARTER RESULTS AND PLANS FOR 2016 FIELD PROGRAM

NovaCopper Inc. has released its financial results for the first quarter ended Feb. 29, 2016, and is reviewing its plan for the 2016 field program. Details of the company's financial results are contained in the unaudited consolidated financial statements and management's discussion and analysis which will be available on the company's website, on SEDAR and on EDGAR. All amounts are in U.S. dollars unless otherwise stated.

Plans initiated for 2016 field program

With sufficient cash on hand to finance its anticipated activities, the company is well positioned to continue its plans to advance the Arctic deposit toward prefeasibility. The company will invest $5.5-million this year mainly for drilling at Arctic during the summer field season as well as to complete in-pit geotechnical, hydrological, metallurgical, environmental and waste rock characterization studies. The company will also continue community engagement and its efforts on local hiring and education along with continuing to engage with the State of Alaska on the permitting of the Ambler access road.

Plans are under way to begin this year's field program in June with the remote camp anticipated to open mid-month. A planned 3,000-metre drill program will start mid-June and continue until mid-August. A significant amount of environmental baseline investigation work is planned for the current year to collect data required for future permitting efforts. Environmental work in 2016 will include an aquatic survey, an archeological review, a subsistence resource study, an avian and large mammal survey, and further expansion and refinement of the company's wetlands delineation studies. Engineering activities during this year's field season include pit slope stability studies, waste rock characterization, hydrological and metallurgical studies. The company will also complete the light detection and ranging survey (airborne laser-light survey used for multidiscipline applications) initiated in 2015 that was unfinished due to poor weather conditions.

The associated table of unaudited selected quarterly information is prepared in accordance with U.S. generally accepted accounting principles.

  
                                     FIRST QUARTER FINANCIAL RESULTS
                          (in thousands of dollars, except for per-share amounts)

Selected financial results                   Three months ended Feb. 29, 2016    Three months ended Feb. 28, 2015

Amortization                                                              $54                                $143
General and administrative                                                348                                 381
Mineral properties expense                                                667                                 327
Professional fees                                                         136                                 161
Salaries                                                                  213                                 250
Salaries -- stock-based compensation                                      282                                 282
Loss and comprehensive loss
for the period                                                          1,695                               1,530
Basic and diluted loss per common share                                 $0.02                               $0.03

For the three months ended Feb. 29, 2016, NovaCopper reported a net loss of $1.7-million (or two cents in basic and diluted loss per common share) compared with a net loss of $1.5-million for the corresponding period in 2015 (or three cents in basic and diluted loss per common share). This variance was primarily due to an increase in mineral properties expenses offset by a decrease in amortization, salaries, professional fees, and general and administrative costs. The company incurred $700,000 in mineral properties expense for the three months ended Feb. 29, 2016, compared with $300,000 for the three months ended Feb. 28, 2015. The significant increase in mineral property expenses in 2016 is related to waste characterization and geotechnical work conducted for the Upper Kobuk mineral properties (UKMP) in Alaska and expenditures incurred at the Titiribi mineral property in Colombia. Amortization expense decreased by $100,000 due to the timing of capital asset purchases and resulted amortization expense. The decrease in salaries and general and administrative expenses was primarily attributed to continued cost-reduction efforts and the company benefiting from the favourable foreign exchange movement of the U.S. dollar against the Canadian dollar in 2016 compared with the first quarter of 2015. The decrease in professional fees is due to less consulting expenses incurred in 2016 compared with the first quarter of 2015.

Liquidity and capital resources

At Feb. 29, 2016, the company had $14.7-million in cash and cash equivalents. The company expended $1.4-million on operating activities during the three-month period ended Feb. 29, 2016, compared with expenditures of $1.1-million for operating activities for the same period in 2015. The majority of cash spent on operating activities during both periods was expended on mineral property expenses, general and administrative, and salaries. The increase in cash spent during the three months ended Feb. 29, 2016, compared with the corresponding period in 2015 was mainly due to higher mineral property expense for engineering studies conducted for the UKMP and expenditures incurred in Colombia.

During the three-month period ended Feb. 29, 2016, and Feb. 28, 2015, the company received no cash from financing activities. During the three-month period ended Feb. 29, 2016, the company expended $2,000 on investing activities for acquisition of equipment and nil during the three-month period ended Feb. 28, 2015.

As at Feb. 29, 2016, the company continues to manage its cash expenditures and management believes that the working capital available is sufficient to meet its operational requirements for the next two years. Future financings are anticipated through equity offerings, debt financing, convertible debt or other means, although there can be no assurance that a financing would be available on terms favourable to the company, or at all.

We seek Safe Harbor.

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