Augen Capital Corp. ("Augen" or "the Company") (TSX VENTURE:AUG) today announced
its unaudited consolidated financial results for the second quarter that ended
June 30, 2009.
For the three month period ended June 30, 2009, Augen's income was $27,198
compared to $694,099 in 2008, and net loss was $201,892 in 2009 compared to
$958,814 in 2008. Although the Company did not generate as much income in 2009
as it did in 2008, the Company was able to partially offset the decrease in
income by a reduction in expenses of $275,124 in 2009. Further, the Company
reported an increase in the value of its Merchant Banking portfolio of $247,111.
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For the three Merchant Banking Managed Products Total
months ended 2009 2008 2009 2008 2009 2008
June 30, $ $ $ $ $ $
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Income (loss) (9,312) 458,923 36,510 235,176 27,198 694,099
Expenses 351,973 300,772 179,939 506,264 531,912 807,036
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Earnings
(loss) before
undernoted
items (361,285) 158,151 (143,429) (271,088) (504,714) (112,937)
Share of
(earnings)
loss and
capital
transactions
from equity
-accounted
investment 37,870 (8,874) - - 37,870 (8,874)
Unrealized
(gain) loss on
investments
held for
trading (247,111) 707,426 - - (247,111) 707,426
Non-recurring
charges 1,038 251,856 1,040 251,856 2,078 503,712
Adjustment to
fair value of
liabilities - (60,769) - - - (60,769)
Amortization 2,574 1,601 2,575 1,601 5,149 3,202
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Earnings
(loss) before
income taxes (155,656) (733,089) (147,044) (524,545) (302,700) (1,257,634)
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Income taxes
Current 6,439 (204,939)
Future (107,247) (93,881)
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(100,808) (298,820)
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Net earnings (loss) and
comprehensive earnings
(loss) (201,892) (958,814)
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For the six month period ended June 30, 2009, Augen's income was $104,727
compared to $901,614 in 2008, and net loss was $601,416 in 2009 compared to
$1,704,798 in 2008. The year-to-date results improved for similar reasons to the
second quarter as described above. In addition to the identified reasons, the
results improved due to the Company recording $38,959 of non-recurring charges
in 2009 compared to $503,712 in 2008, a decrease of $464,753.
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For the six Merchant Banking Managed Products Total
months ended 2009 2008 2009 2008 2009 2008
June 30, $ $ $ $ $ $
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Income 36,391 446,290 68,336 455,324 104,727 901,614
Expenses 783,691 663,106 355,161 733,235 1,138,852 1,396,341
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Earnings
(loss)
before
undernoted
items (747,300) (216,816) (286,825) (277,911) (1,034,125) (494,727)
Share of
(earnings)
loss and
capital
transac-
tions
from
equity-
accounted
investment 223,487 (25,190) - - 223,487 (25,190)
Unrealized
(gain)
loss on
invest-
ments
held for
trading (415,345) 1,276,190 - - (415,345) 1,276,190
Non-recur-
ring
charges 19,479 251,856 19,480 251,856 38,959 503,712
Adjustment
to fair
value of
liabilities - (87,481) - - - (87,481)
Amortization 5,149 3,202 5,149 3,203 10,298 6,405
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Earnings
(loss)
before
income
taxes (580,070) (1,635,393) (311,454) (532,970) (891,524) (2,168,363)
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Income
taxes
Current (7,627) (259,390)
Future (282,481) (204,175)
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(290,108) (463,565)
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Net earnings
(loss) and
comprehensive
earnings
(loss) (601,416) (1,704,798)
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Merchant Banking Portfolio
The Company's investment portfolio had a fair value of $1,219,594 as at June 30,
2009, having increased by $577,449 since December 31, 2008. As a result of the
increase in value of the Merchant Banking portfolio and transactional activity
during the period, a net realized and unrealized gain of $384,100 was reported
during the six month period ended June 30, 2009, compared to a net realized and
unrealized loss of $1,167,268 during the same period in 2008.
Shares-for-debt transaction
At a special meeting of the shareholders of Augen Gold Corp. ("AGC"), an
investee company in the Merchant Banking portfolio, held on March 13, 2009, AGC
shareholders approved a shares-for-debt transaction for the conversion of debt
owed by AGC to Augen Capital Corp., into common shares. On April 7, 2009, AGC
issued 7,479,010 common shares to settle $1,121,851 of debt. Augen Capital Corp.
now owns 11,519,010 shares of Augen Gold Corp. or 35.5% of the issued and
outstanding common shares of AGC. Augen recorded a corporate development expense
of $169,412 as a result of this transaction during the six months ended June 30,
2009. The Company records its investment in AGC using the equity accounting
method. The carrying amount of the investment has increased since December 31,
2008 by $898,364. The increase is comprised of $1,121,851 which represents the
shares-for-debt conversion, partially offset by the Company's proportionate
share of AGC's loss and capital transactions of $223,487.
The full unaudited consolidated financial statements for the period ended June
30, 2009 are available at www.augencc.com or at www.sedar.com.
About Augen Capital
Augen Capital Corp. ("Augen") (TSX VENTURE:AUG) is a Toronto-based public
merchant bank specializing in the financing of and investment in emerging
resource companies. Augen manages a merchant banking hard dollar portfolio of
emerging resource stocks including private companies and is an industry
performance leader in tax-advantaged flow-through investments in Canada's
resource sector having raised over $80 million in flow-through limited
partnership assets since inception. Augen holds over one hundred gold, base
metals and uranium exploration and development public and private companies with
direct holdings in its Merchant Banking portfolio and consulting assets in
flow-through limited partnerships.
For more information on Augen Capital, visit our website at www.augencc.com. The
Company's public documents may be accessed at www.sedar.com
This news release contains forward-looking statements. These statements are
based on certain factors and assumptions as set forth in this news release
including expected growth, results of operations, performance and business
prospects and opportunities. While the Company considers these factors and
assumptions to be reasonable based on information currently available, they may
prove to be incorrect. A number of factors could cause actual results to differ
materially from those in the forward-looking statements, including, but not
limited to results of exploration, project development, reclamation and capital
costs of the companies in the merchant banking portfolios ("investee
companies"), and the Company's financial condition and prospects, could differ
materially from those currently anticipated in such statements for many reasons
such as: changes in general economic conditions and conditions in the financial
markets; changes in demand and prices for the minerals the investee companies
expect to produce; litigation, legislative, environmental and other judicial,
regulatory, political and competitive developments; technological and
operational difficulties encountered in connection with the activities of the
Company and investee companies. Additional risks and uncertainties can be found
in our Management's Discussion and Analysis and in filings with the Canadian
provincial securities commissions. Forward-looking statements are given only as
at the date of this news release and the Company disclaims any obligation to
update or revise the forward-looking statements, whether as a result of new
information, future events or otherwise.
Shares outstanding: 36,615,615
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