San Gold Corporation (SGRCF)

[goldenpolarbear]

NOT GOOD! & simply put NOT-Good ENOUGH!
Gold sales revenue for the year ended December 31, 2013 of $106.3 million was 25% lower than revenues of $142.1 million recognized in the previous year. The decrease in gold sales revenue is a result of a 15% decrease in the average realized gold price compared to the prior year and a 12% decrease in the number of ounces sold. Gold sales revenue in the fourth quarter of 2013 of $22.9 million was 33% lower than revenues of $34.1 million recognized in the fourth quarter of 2012. The decrease in gold sales revenue in the fourth quarter of 2013 is a result of a 21% decrease in the average realized gold price and a 15% decrease in the number of ounces sold compared to the fourth quarter of 2012.

The Company recorded a non-cash impairment of $83.1 million on December 31, 2013, upon completion of its annual assessment of the value-in-use of its mineral properties.

Total and comprehensive loss was $111.3 million compared to $13.2 million for the year ended December 31, 2012. Total and comprehensive loss of $91.7 million in the fourth quarter of 2013 decreased relative to total and comprehensive loss of $3.9 million in the fourth quarter of 2012. Excluding the non-cash impairment charge of $83.1 million, total and comprehensive loss was $28.2 million for the year and $8.6 million for the fourth quarter.

Loss from operations for the year ended December 31, 2013 was $83.2 million, representing a significant reduction relative to a loss from operations of $17.9 million in the same period of last year. Loss from operations in the fourth quarter of 2013 was $86.0 million compared to income from operations of $3.0 million in the same period of last year. Excluding the non-cash impairment charge of $83.1 million, operating loss was $0.1 million for the year and $2.9 million for the fourth quarter.

The changes in income resulted primarily from reductions in gold revenue, increased interest expense associated with convertible debentures issued in 2013, and the recognition of the non-cash impairment charge. These changes were partially offset by a $13.2 million decrease in non-cash depletion and amortization, a $3.8 million decrease in share-based compensation expense, and a $5.0 million decrease in the equity loss from an associate company. Depletion expense has decreased due to a lower per ounce depletion charge as a result of reduced mine development capital expenditures and increased reserve and resource base used in calculating the expense. The per ounce depletion charge is expected to decrease further given the reduced carrying value of mineral properties and the anticipated reductions to capital expenditures and upgrades to the Company's resources and reserves to higher confidence categories. For the year and fourth quarter ended December 31, 2013, the Company did not recognize any equity losses from associated companies while it did recognize mark to market losses on portfolio gold company investments.

For the year ended December 31, 2013, cash flow from operations before changes in non-cash working capital decreased to $5.6 million, compared to $42.1 million in 2012. After changes in non-cash working capital, cash flow from operations was $2.0 million in 2013, a substantial reduction compared to $51.1 million in the prior year. Non-cash working capital was a use of cash in 2013 compared to a source of cash in 2012, which is largely attributable to the timing of sales, production and accounts payable.

Subsequent to year end, the Company closed the first tranche of a private placement offering of senior secured convertible notes. At the first closing, the Company issued US$23,750,000 aggregate principal amount of Notes to institutional subscribers. The proceeds from the offering will be used to fund continued development of the Company's mineral properties, in particular the Rice Lake Complex, and for general working capital purposes. This placement significantly strengthens the Company's balance sheet and provides financial flexibility to advance capital projects associated with the integration of our Rice Lake and Hinge/007 mines.

http://sangold.mwnewsroom.com/press-releases/san-gold-reports-2013-annual-and-fourth-quarter-re-tsx-sgr-201403210934735001

If this company does not quickly turn a profit it will be on the chopping or auction block and in Waterton Resources hands.