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Message: News on Denison (DML)
This is a part of the news release that was released today, doesn't look good for tomorrow for DML :-( full news release is on their web site.
Denison Mines Corp. Reports 2008 Earnings
20:23 EDT Wednesday, March 18, 2009
TORONTO, ONTARIO--(Marketwire - March 18, 2009) - Denison Mines Corp. ("Denison" or the "Company") (TSX:DML)(NYSE Alternext US:DNN)(NYSE Amex:DNN) today reported its financial results for the three months and year ended December 31, 2008. All amounts in this release are in U.S. dollars unless otherwise indicated. Results for the year reflected strong sales revenue for both U.S. and Canadian production. However, the current economic climate and its impact on commodity prices and stock market valuations resulted in non-cash impairment charges totalling $58,964,000 in the fourth quarter. The Company recorded impairment of its goodwill which arose on the acquisition of Denison Mines Inc. ("DMI") in 2006 resulting in a charge to income of $36,512,000. Stock market valuations of the Company's investments in Uranerz Energy Corporation and Energy Metals Limited resulted in the Company recording an impairment charge of $12,952,000 and the decline in the value of vanadium resulted in the Company writing down its vanadium inventory by $9,500,000. In addition, the Company expensed $5,250,000 relating to forfeiture of stock options during the quarter.
The Company also expenses exploration expenditures on properties not sufficiently advanced to identify their development potential which amounted to $20,114,000 for the year. As a result, consolidated net loss for the year was $80,648,000 or $0.42 per share.
The Company had cash and cash equivalent of $3,206,000 at December 31, 2008 and portfolio investments with a market value of $10,691,000. The Company has in place a $125,000,000 revolving credit facility with a term to June 30, 2011. Bank indebtedness under the facility at December 31, 2008 was $99,998,000. The Company is currently in compliance with all covenants under the facility. In January 2009, the Company issued 28,750,000 common shares for gross proceeds of approximately $38,946,000 (CDN$47,437,500).
Recent turmoil in world financial markets has severely curtailed access to debt and other capital. Commodity prices, particularly short-term spot prices, are also below costs. The Company will continue to review its production and spending plans as the year progresses to keep them within available capital resources.
Denison has initiated a process to consider and respond to various strategic opportunities which may be available to the Company over the next few months including, but not limited to, entering into offtake contracts with utility customers which may involve a strategic investment in Denison, asset sales, purchases and joint ventures, investment by private equity investors and potential corporate transactions with other uranium producers. Denison has retained Cormark Securities Inc. for the purpose of providing it with financial advice in evaluating these alternatives and executing any related transactions.
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