Item 1.
|
Financial Statements
|
NOVAGOLD RESOURCES INC.
|
CONDENSED CONSOLIDATED INTERIM BALANCE SHEETS
|
(Unaudited, US dollars in thousands)
|
|
|
As of
August 31,
2021
|
|
|
As of
November 30,
2020
|
|
ASSETS
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
117,793
|
|
|
$
|
60,906
|
|
Term deposits
|
|
|
55,548
|
|
|
|
61,000
|
|
Notes receivable (Note 4)
|
|
|
—
|
|
|
|
72,611
|
|
Other assets (Note 6)
|
|
|
529
|
|
|
|
1,869
|
|
Current assets
|
|
|
173,870
|
|
|
|
196,386
|
|
Notes receivable (Note 4)
|
|
|
23,363
|
|
|
|
23,405
|
|
Investment in Donlin Gold (Note 5)
|
|
|
4,725
|
|
|
|
2,614
|
|
Other assets (Note 6)
|
|
|
2,236
|
|
|
|
2,036
|
|
Total assets
|
|
$
|
204,194
|
|
|
$
|
224,441
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES
|
|
Accounts payable and accrued liabilities
|
|
$
|
646
|
|
|
$
|
900
|
|
Accrued payroll and related benefits
|
|
|
1,749
|
|
|
|
2,215
|
|
Lease obligations
|
|
|
221
|
|
|
|
207
|
|
Other liabilities
|
|
|
182
|
|
|
|
187
|
|
Current liabilities
|
|
|
2,798
|
|
|
|
3,509
|
|
Promissory note (Note 7)
|
|
|
114,221
|
|
|
|
109,801
|
|
Lease obligations
|
|
|
244
|
|
|
|
404
|
|
Total liabilities
|
|
|
117,263
|
|
|
|
113,714
|
|
|
|
|
|
|
|
|
|
|
Commitments and contingencies (Note 7)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EQUITY
|
|
|
|
|
|
|
|
|
Common shares
|
|
|
1,975,405
|
|
|
|
1,972,029
|
|
Contributed surplus
|
|
|
83,283
|
|
|
|
81,203
|
|
Accumulated deficit
|
|
|
(1,948,896
|
)
|
|
|
(1,918,629
|
)
|
Accumulated other comprehensive loss
|
|
|
(22,861
|
)
|
|
|
(23,876
|
)
|
Total equity
|
|
|
86,931
|
|
|
|
110,727
|
|
Total liabilities and equity
|
|
$
|
204,194
|
|
|
$
|
224,441
|
|
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
These condensed consolidated interim financial statements are authorized for issue by the Board of Directors on September 29, 2021. They are signed on the Company’s behalf by:
/s/ Gregory A. Lang, Director
|
|
/s/ Anthony P. Walsh, Director
|
|
NOVAGOLD RESOURCES INC.
|
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF LOSS AND COMPREHENSIVE LOSS
|
(Unaudited, US dollars in thousands except per share amounts)
|
|
|
Three months ended
August 31,
|
|
|
Nine months ended
August 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2021
|
|
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
General and administrative (Note 9)
|
|
$
|
4,883
|
|
|
$
|
4,745
|
|
|
$
|
15,204
|
|
|
$
|
13,846
|
|
Equity loss – Donlin Gold (Note 5)
|
|
|
6,748
|
|
|
|
6,150
|
|
|
|
12,914
|
|
|
|
11,418
|
|
|
|
|
11,631
|
|
|
|
10,895
|
|
|
|
28,118
|
|
|
|
25,264
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from operations
|
|
|
(11,631
|
)
|
|
|
(10,895
|
)
|
|
|
(28,118
|
)
|
|
|
(25,264
|
)
|
Interest expense on promissory note
|
|
|
(1,506
|
)
|
|
|
(1,428
|
)
|
|
|
(4,420
|
)
|
|
|
(4,588
|
)
|
Accretion of notes receivable
|
|
|
639
|
|
|
|
835
|
|
|
|
2,347
|
|
|
|
2,483
|
|
Other income (expense), net (Note 10)
|
|
|
818
|
|
|
|
(982
|
)
|
|
|
34
|
|
|
|
1,599
|
|
Loss before income taxes and other items
|
|
|
(11,680
|
)
|
|
|
(12,470
|
)
|
|
|
(30,157
|
)
|
|
|
(25,770
|
)
|
Income tax expense
|
|
|
(110
|
)
|
|
|
(266
|
)
|
|
|
(110
|
)
|
|
|
(794
|
)
|
Net loss
|
|
|
(11,790
|
)
|
|
|
(12,736
|
)
|
|
|
(30,267
|
)
|
|
|
(26,564
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign currency translation adjustments
|
|
|
(1,457
|
)
|
|
|
2,345
|
|
|
|
1,015
|
|
|
|
731
|
|
|
|
|
(1,457
|
)
|
|
|
2,345
|
|
|
|
1,015
|
|
|
|
731
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive loss
|
|
$
|
(13,247
|
)
|
|
$
|
(10,391
|
)
|
|
$
|
(29,252
|
)
|
|
$
|
(25,833
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share – basic and diluted
|
|
$
|
(0.04
|
)
|
|
$
|
(0.04
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(0.08
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average shares outstanding
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic and diluted (thousands)
|
|
|
331,641
|
|
|
|
329,598
|
|
|
|
331,442
|
|
|
|
329,001
|
|
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
NOVAGOLD RESOURCES INC.
|
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF CASH FLOWS
|
(Unaudited, US dollars in thousands)
|
|
|
Three months ended
August 31,
|
|
|
Nine months ended
August 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
Operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(11,790
|
)
|
|
$
|
(12,736
|
)
|
|
$
|
(30,267
|
)
|
|
$
|
(26,564
|
)
|
Adjustments:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity loss – Donlin Gold
|
|
|
6,748
|
|
|
|
6,150
|
|
|
|
12,914
|
|
|
|
11,418
|
|
Share-based compensation
|
|
|
2,050
|
|
|
|
1,783
|
|
|
|
6,187
|
|
|
|
5,259
|
|
Interest expense on promissory note
|
|
|
1,506
|
|
|
|
1,428
|
|
|
|
4,420
|
|
|
|
4,588
|
|
Foreign exchange (gain) loss
|
|
|
(906
|
)
|
|
|
1,745
|
|
|
|
620
|
|
|
|
485
|
|
Accretion of notes receivable
|
|
|
(639
|
)
|
|
|
(835
|
)
|
|
|
(2,347
|
)
|
|
|
(2,483
|
)
|
Change in fair value of marketable securities
|
|
|
168
|
|
|
|
(372
|
)
|
|
|
(316
|
)
|
|
|
(662
|
)
|
Deferred income tax expense
|
|
|
—
|
|
|
|
175
|
|
|
|
—
|
|
|
|
521
|
|
Other operating adjustments
|
|
|
2
|
|
|
|
4
|
|
|
|
6
|
|
|
|
14
|
|
Net change in operating assets and liabilities (Note 12)
|
|
|
984
|
|
|
|
832
|
|
|
|
644
|
|
|
|
267
|
|
Net cash used in operating activities of continuing operations
|
|
|
(1,877
|
)
|
|
|
(1,826
|
)
|
|
|
(8,139
|
)
|
|
|
(7,157
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from term deposits
|
|
|
25,000
|
|
|
|
—
|
|
|
|
86,000
|
|
|
|
46,000
|
|
Purchases of term deposits
|
|
|
(25,000
|
)
|
|
|
—
|
|
|
|
(80,799
|
)
|
|
|
(46,000
|
)
|
Proceeds from note receivable
|
|
|
75,000
|
|
|
|
—
|
|
|
|
75,000
|
|
|
|
—
|
|
Funding of Donlin Gold
|
|
|
(6,901
|
)
|
|
|
(6,693
|
)
|
|
|
(15,025
|
)
|
|
|
(13,583
|
)
|
Net cash provided from (used in) investing activities
|
|
|
68,099
|
|
|
|
(6,693
|
)
|
|
|
65,176
|
|
|
|
(13,583
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Withholding tax on share-based compensation
|
|
|
—
|
|
|
|
—
|
|
|
|
(731
|
)
|
|
|
(1,652
|
)
|
Net cash used in investing activities
|
|
|
—
|
|
|
|
—
|
|
|
|
(731
|
)
|
|
|
(1,652
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Effect of exchange rate changes on cash
|
|
|
(217
|
)
|
|
|
538
|
|
|
|
581
|
|
|
|
191
|
|
Change in cash and cash equivalents
|
|
|
66,005
|
|
|
|
(7,981
|
)
|
|
|
56,887
|
|
|
|
(22,201
|
)
|
Cash and cash equivalents at beginning of period
|
|
|
51,788
|
|
|
|
53,329
|
|
|
|
60,906
|
|
|
|
67,549
|
|
Cash and cash equivalents at end of period
|
|
$
|
117,793
|
|
|
$
|
45,348
|
|
|
$
|
117,793
|
|
|
$
|
45,348
|
|
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
NOVAGOLD RESOURCES INC.
|
CONDENSED CONSOLIDATED INTERIM STATEMENTS OF EQUITY
|
(Unaudited, US dollars and shares in thousands)
|
|
|
Nine months ended August 31, 2021
|
|
|
|
Common shares
|
|
|
Contributed
|
|
|
Accumulated
|
|
|
|
|
|
|
Total
|
|
|
|
Shares
|
|
|
Amount
|
|
|
surplus
|
|
|
deficit
|
|
|
AOCL*
|
|
|
equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
November 30, 2020
|
|
|
330,412
|
|
|
$
|
1,972,029
|
|
|
$
|
81,203
|
|
|
$
|
(1,918,629
|
)
|
|
$
|
(23,876
|
)
|
|
$
|
110,727
|
|
Share-based compensation
|
|
|
—
|
|
|
|
—
|
|
|
|
2,042
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,042
|
|
Performance share units (PSUs) settled in shares
|
|
|
574
|
|
|
|
1,460
|
|
|
|
(1,460
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Stock options exercised
|
|
|
345
|
|
|
|
777
|
|
|
|
(777
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Withholding tax on PSUs
|
|
|
—
|
|
|
|
—
|
|
|
|
(731
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(731
|
)
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(7,956
|
)
|
|
|
—
|
|
|
|
(7,956
|
)
|
Other comprehensive income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
778
|
|
|
|
778
|
|
February 28, 2021
|
|
|
331,331
|
|
|
$
|
1,974,266
|
|
|
$
|
80,277
|
|
|
$
|
(1,926,585
|
)
|
|
$
|
(23,098
|
)
|
|
$
|
104,860
|
|
Share-based compensation
|
|
|
—
|
|
|
|
—
|
|
|
|
2,095
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,095
|
|
Stock options exercised
|
|
|
194
|
|
|
|
618
|
|
|
|
(618
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(10,521
|
)
|
|
|
—
|
|
|
|
(10,521
|
)
|
Other comprehensive income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,694
|
|
|
|
1,694
|
|
May 31, 2021
|
|
|
331,525
|
|
|
$
|
1,974,884
|
|
|
$
|
81,754
|
|
|
$
|
(1,937,106
|
)
|
|
$
|
(21,404
|
)
|
|
$
|
98,128
|
|
Share-based compensation
|
|
|
—
|
|
|
|
—
|
|
|
|
2,050
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,050
|
|
Stock options exercised
|
|
|
153
|
|
|
|
521
|
|
|
|
(521
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(11,790
|
)
|
|
|
—
|
|
|
|
(11,790
|
)
|
Other comprehensive loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,457
|
)
|
|
|
(1,457
|
)
|
August 31, 2021
|
|
|
331,678
|
|
|
$
|
1,975,405
|
|
|
$
|
83,283
|
|
|
$
|
(1,948,896
|
)
|
|
$
|
(22,861
|
)
|
|
$
|
86,931
|
|
|
|
Nine months ended August 31, 2020
|
|
|
|
Common shares
|
|
|
Contributed
|
|
|
Accumulated
|
|
|
|
|
|
|
Total
|
|
|
|
Shares
|
|
|
Amount
|
|
|
surplus
|
|
|
deficit
|
|
|
AOCL*
|
|
|
equity
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
November 30, 2019
|
|
|
327,630
|
|
|
$
|
1,965,573
|
|
|
$
|
82,254
|
|
|
$
|
(1,885,065
|
)
|
|
$
|
(24,808
|
)
|
|
$
|
137,954
|
|
Share-based compensation
|
|
|
—
|
|
|
|
—
|
|
|
|
1,761
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,761
|
|
PSUs settled in shares
|
|
|
410
|
|
|
|
1,026
|
|
|
|
(1,026
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Stock options exercised
|
|
|
560
|
|
|
|
1,618
|
|
|
|
(1,618
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Withholding tax on PSUs
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,652
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,652
|
)
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(6,595
|
)
|
|
|
—
|
|
|
|
(6,595
|
)
|
Other comprehensive loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(455
|
)
|
|
|
(455
|
)
|
February 29, 2020
|
|
|
328,600
|
|
|
$
|
1,968,217
|
|
|
$
|
79,719
|
|
|
$
|
(1,891,660
|
)
|
|
$
|
(25,263
|
)
|
|
$
|
131,013
|
|
Share-based compensation
|
|
|
—
|
|
|
|
—
|
|
|
|
1,715
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,715
|
|
Stock options exercised
|
|
|
998
|
|
|
|
2,082
|
|
|
|
(2,082
|
)
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(7,233
|
)
|
|
|
—
|
|
|
|
(7,233
|
)
|
Other comprehensive loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(1,159
|
)
|
|
|
(1,159
|
)
|
May 31, 2020
|
|
|
329,598
|
|
|
$
|
1,970,299
|
|
|
$
|
79,352
|
|
|
$
|
(1,898,893
|
)
|
|
$
|
(26,422
|
)
|
|
$
|
124,336
|
|
Share-based compensation
|
|
|
—
|
|
|
|
—
|
|
|
|
1,783
|
|
|
|
—
|
|
|
|
—
|
|
|
|
1,783
|
|
Net loss
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
(12,736
|
)
|
|
|
—
|
|
|
|
(12,736
|
)
|
Other comprehensive income
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
—
|
|
|
|
2,345
|
|
|
|
2,345
|
|
August 31, 2020
|
|
|
329,598
|
|
|
$
|
1,970,299
|
|
|
$
|
81,135
|
|
|
$
|
(1,911,629
|
)
|
|
$
|
(24,077
|
)
|
|
$
|
115,728
|
|
* Accumulated other comprehensive loss
The accompanying notes are an integral part of these condensed consolidated interim financial statements.
NOVAGOLD RESOURCES INC.
|
NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
|
(Unaudited, US dollars in thousands except per share amounts)
|
NOTE 1 – NATURE OF OPERATIONS AND BASIS OF PRESENTATION
NOVAGOLD RESOURCES INC. and its affiliates and subsidiaries (collectively, “NOVAGOLD” or the “Company”) operate in the mining industry, focused on the exploration for and development of gold mineral properties. The Company has no realized revenues from its planned principal business purpose. The Company’s principal asset is a 50% interest in the Donlin Gold project in Alaska, USA. The Donlin Gold project is owned and operated by Donlin Gold LLC, a limited liability company that is owned equally by wholly-owned subsidiaries of NOVAGOLD and Barrick Gold Corporation (“Barrick”).
The Condensed Consolidated Interim Financial Statements (“interim statements”) of NOVAGOLD are unaudited. In the opinion of management, all adjustments and disclosures necessary for a fair presentation of these interim statements have been included. The results reported in these interim statements are not necessarily indicative of the results that may be reported for the entire year. These interim statements should be read in conjunction with NOVAGOLD’s Consolidated Financial Statements for the year ended November 30, 2020. The year-end balance sheet data was derived from the audited financial statements and certain information and footnote disclosures required by United States generally accepted accounting principles (US GAAP) have been condensed or omitted.
The functional currency for the Company’s Canadian operations is the Canadian dollar and the functional currency for the Company’s U.S. operations is the United States dollar. References in these Condensed Consolidated Interim Financial Statements and Notes to $ refer to United States dollars and C$ to Canadian dollars. Dollar amounts are in thousands, except for per share amounts.
NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Recently adopted accounting pronouncements
Fair Value Disclosure Requirements
In August 2018, Accounting Standards Update (“ASU”) No. 2018-13 was issued to modify and enhance the disclosure requirements for fair value measurements. The Company adopted this standard on December 1, 2020. Adoption of this guidance did not impact the Company’s note disclosures.
NOTE 3 – SEGMENTED INFORMATION
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Chief Executive Officer. The Chief Executive Officer considers the business as a single segment considering the performance of our investment in the Donlin Gold project in Alaska, USA (Note 5).
NOTE 4 – NOTES RECEIVABLE
On July 27, 2018, the Company sold its interest in the Galore Creek project to a subsidiary of Newmont Corporation (“Newmont”) for cash proceeds of $100,000, a $75,000 note receivable due on the earlier of the completion of a Galore Creek pre-feasibility study or July 27, 2021, a $25,000 note receivable due on the earlier of the completion of a Galore Creek feasibility study or July 31, 2023, and a contingent note for $75,000 upon approval of a Galore Creek project construction plan by the owner(s). The Company received $75,000 from Newmont on July 27, 2021.
As of August 31, 2021, the carrying value of the $25,000 note receivable was $23,363 including $2,415 of accumulated accretion. The carrying value of the note receivable is being accreted to $25,000 over five years at a discount rate of 3.6% based on quoted market values for Newmont debt with a similar term.
A contingent note for $75,000 is receivable upon approval of a Galore Creek project construction plan by the owner(s). No value was assigned to the final $75,000 contingent note receivable. The Company determined that Galore Creek project construction approval was not probable as of the closing of the Galore Creek sale. The Company’s assessment did not change as of August 31, 2021.
NOVAGOLD RESOURCES INC.
|
NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
|
(Unaudited, US dollars in thousands except per share amounts)
|
NOTE 5 – INVESTMENT IN DONLIN GOLD
The Donlin Gold project is owned and operated by Donlin Gold LLC, a limited liability company in which wholly-owned subsidiaries of NOVAGOLD and Barrick each own a 50% interest. Donlin Gold LLC has a board of four members, with two members selected by Barrick and two members selected by the Company. All significant decisions related to Donlin Gold LLC require the approval of at least a majority of the Donlin Gold LLC board members.
Changes in the Company’s investment in Donlin Gold LLC are summarized as follows:
|
|
Three months ended August 31,
|
|
|
Nine months ended August 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
Balance – beginning of period
|
|
$
|
4,572
|
|
|
$
|
3,462
|
|
|
$
|
2,614
|
|
|
$
|
1,840
|
|
Share of losses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mineral property expenditures
|
|
|
(6,650
|
)
|
|
|
(6,111
|
)
|
|
|
(12,680
|
)
|
|
|
(11,319
|
)
|
Depreciation
|
|
|
(98
|
)
|
|
|
(39
|
)
|
|
|
(234
|
)
|
|
|
(99
|
)
|
|
|
|
(6,748
|
)
|
|
|
(6,150
|
)
|
|
|
(12,914
|
)
|
|
|
(11,418
|
)
|
Funding
|
|
|
6,901
|
|
|
|
6,693
|
|
|
|
15,025
|
|
|
|
13,583
|
|
Balance – end of period
|
|
$
|
4,725
|
|
|
$
|
4,005
|
|
|
$
|
4,725
|
|
|
$
|
4,005
|
|
The following amounts represent the Company’s 50% share of the assets and liabilities of Donlin Gold LLC. Donlin Gold LLC capitalized the initial contribution of the Donlin Gold property as Non-current assets: Mineral property with a carrying value of $64,000, resulting in a higher carrying value of the mineral property for Donlin Gold LLC than that of the Company.
|
|
At
August 31,
2021
|
|
|
As of
November 30,
2020
|
|
Current assets: Cash, prepaid expenses and other receivables
|
|
$
|
6,618
|
|
|
$
|
2,654
|
|
Non-current assets: Property and equipment
|
|
|
1,411
|
|
|
|
1,339
|
|
Non-current assets: Mineral property
|
|
|
32,586
|
|
|
|
32,615
|
|
Current liabilities: Accounts payable and accrued liabilities
|
|
|
(3,223
|
)
|
|
|
(1,271
|
)
|
Non-current liabilities: Reclamation and lease obligations
|
|
|
(667
|
)
|
|
|
(723
|
)
|
Net assets
|
|
$
|
36,725
|
|
|
$
|
34,614
|
|
NOTE 6 – OTHER ASSETS
|
|
As of
August 31,
2021
|
|
|
As of
November 30,
2020
|
|
Other current assets:
|
|
|
|
|
|
|
|
|
Accounts and interest receivable
|
|
$
|
45
|
|
|
$
|
577
|
|
Prepaid expenses
|
|
|
484
|
|
|
|
1,292
|
|
|
|
$
|
529
|
|
|
$
|
1,869
|
|
|
|
|
|
|
|
|
|
|
Other long-term assets:
|
|
|
|
|
|
|
|
|
Marketable equity securities
|
|
$
|
1,755
|
|
|
$
|
1,402
|
|
Right-of-use assets
|
|
|
453
|
|
|
|
600
|
|
Office equipment
|
|
|
28
|
|
|
|
34
|
|
|
|
$
|
2,236
|
|
|
$
|
2,036
|
|
NOVAGOLD RESOURCES INC.
|
NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
|
(Unaudited, US dollars in thousands except per share amounts)
|
NOTE 7 – PROMISSORY NOTE
The Company has a promissory note payable to Barrick of $114,221, comprised of $51,576 in principal, and $62,645 in accrued interest at U.S. prime plus 2%. The promissory note resulted from the agreement that led to the formation of Donlin Gold LLC, where the Company agreed to reimburse Barrick for a portion of their expenditures incurred from April 1, 2006 to November 30, 2007. The promissory note and accrued interest are payable from 85% of the Company’s share of revenue from future mine production or from any net proceeds resulting from a reduction of the Company’s interest in Donlin Gold LLC. The carrying value of the promissory note approximates fair value.
NOTE 8 – FAIR VALUE ACCOUNTING
Financial instruments measured at fair value are classified into one of three levels in the fair value hierarchy according to the significance of the inputs used in making the measurement. The three levels of the fair value hierarchy are as follows:
Level 1 — Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;
Level 2 — Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and
Level 3 — Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).
The Company’s marketable equity securities are valued using quoted market prices in active markets and as such are classified within Level 1 of the fair value hierarchy. The fair value of the marketable equity securities was $1,755 at August 31, 2021 ($1,402 at November 30, 2020), calculated as the quoted market price of the marketable equity security multiplied by the quantity of shares held by the Company.
NOTE 9 – GENERAL AND ADMINISTRATIVE EXPENSES
|
|
Three months ended August 31,
|
|
|
Nine months ended August 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
Share-based compensation (Note 11)
|
|
$
|
2,050
|
|
|
$
|
1,783
|
|
|
$
|
6,187
|
|
|
$
|
5,259
|
|
Salaries and benefits
|
|
|
1,625
|
|
|
|
1,483
|
|
|
|
4,948
|
|
|
|
4,722
|
|
Office expense
|
|
|
595
|
|
|
|
461
|
|
|
|
1,798
|
|
|
|
1,644
|
|
Professional fees
|
|
|
409
|
|
|
|
669
|
|
|
|
1,416
|
|
|
|
1,251
|
|
Corporate communications and regulatory
|
|
|
202
|
|
|
|
347
|
|
|
|
849
|
|
|
|
964
|
|
Depreciation
|
|
|
2
|
|
|
|
2
|
|
|
|
6
|
|
|
|
6
|
|
|
|
$
|
4,883
|
|
|
$
|
4,745
|
|
|
$
|
15,204
|
|
|
$
|
13,846
|
|
NOTE 10 – OTHER INCOME (EXPENSE), NET
|
|
Three months ended August 31,
|
|
|
Nine months ended August 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
Change in fair market value of marketable securities
|
|
$
|
(168
|
)
|
|
$
|
372
|
|
|
$
|
316
|
|
|
$
|
662
|
|
Interest income
|
|
|
80
|
|
|
|
391
|
|
|
|
338
|
|
|
|
1,422
|
|
Foreign exchange gain (loss)
|
|
|
906
|
|
|
|
(1,745
|
)
|
|
|
(620
|
)
|
|
|
(485
|
)
|
|
|
$
|
818
|
|
|
$
|
(982
|
)
|
|
$
|
34
|
|
|
$
|
1,599
|
|
NOTE 11 – SHARE-BASED COMPENSATION
|
|
Three months ended August 31,
|
|
|
Nine months ended August 31,
|
|
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
Stock options
|
|
$
|
1,157
|
|
|
$
|
1,095
|
|
|
$
|
3,557
|
|
|
$
|
3,196
|
|
Performance share unit plan
|
|
|
831
|
|
|
|
636
|
|
|
|
2,456
|
|
|
|
1,913
|
|
Deferred share unit plan
|
|
|
62
|
|
|
|
52
|
|
|
|
174
|
|
|
|
150
|
|
|
|
$
|
2,050
|
|
|
$
|
1,783
|
|
|
$
|
6,187
|
|
|
$
|
5,259
|
|
NOVAGOLD RESOURCES INC.
|
NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
|
(Unaudited, US dollars in thousands except per share amounts)
|
Stock options
A summary of stock options outstanding as of August 31, 2021 and activity during the nine months ended August 31, 2021 are as follows:
|
|
Number of stock options (thousands)
|
|
|
Weighted- average exercise price per share
|
|
|
Weighted- average
remaining
contractual term
(years)
|
|
|
Aggregate
intrinsic
value
|
|
November 30, 2020
|
|
|
10,403
|
|
|
$
|
4.59
|
|
|
|
|
|
|
|
|
|
Granted
|
|
|
1,218
|
|
|
|
9.96
|
|
|
|
|
|
|
|
|
|
Exercised
|
|
|
(1,221
|
)
|
|
|
4.27
|
|
|
|
|
|
|
|
|
|
August 31, 2021
|
|
|
10,400
|
|
|
|
5.29
|
|
|
|
2.03
|
|
|
$
|
24,122
|
|
Vested and exercisable as of August 31, 2021
|
|
|
7,076
|
|
|
$
|
4.34
|
|
|
|
1.41
|
|
|
$
|
20,629
|
|
The following table summarizes other stock option-related information:
|
|
Nine months ended August 31,
|
|
|
|
2021
|
|
|
2020
|
|
Weighted-average assumptions used to value stock option awards:
|
|
|
|
|
|
|
|
|
Expected volatility
|
|
|
47.3
|
%
|
|
|
46.2
|
%
|
Expected term of options (years)
|
|
|
4
|
|
|
|
4
|
|
Expected dividend rate
|
|
|
—
|
|
|
|
—
|
|
Risk-free interest rate
|
|
|
0.3
|
%
|
|
|
1.5
|
%
|
Expected forfeiture rate
|
|
|
3.0
|
%
|
|
|
3.1
|
%
|
Weighted-average grant-date fair value
|
|
$
|
3.66
|
|
|
$
|
2.71
|
|
Intrinsic value of options exercised
|
|
$
|
6,837
|
|
|
$
|
15,198
|
|
Cash received from options exercised
|
|
$
|
—
|
|
|
$
|
—
|
|
As of August 31, 2021, the Company had $3,630 of unrecognized compensation cost related to 3,325,000 non-vested stock options expected to be recognized and vest over a period of approximately 2.25 years.
Performance share units
A summary of PSU awards outstanding as of August 31, 2021 and activity during the nine months ended August 31, 2021 are as follows:
|
|
Number of PSU awards (thousands)
|
|
|
Weighted- average grant day fair value per award
|
|
|
Aggregate
intrinsic
value
|
|
November 30, 2020
|
|
|
1,684
|
|
|
$
|
4.59
|
|
|
|
|
|
Granted
|
|
|
331
|
|
|
|
10.07
|
|
|
|
|
|
Vested
|
|
|
(648
|
)
|
|
|
3.85
|
|
|
|
|
|
Performance adjustment
|
|
|
216
|
|
|
|
3.85
|
|
|
|
|
|
August 31, 2021
|
|
|
1,583
|
|
|
$
|
5.94
|
|
|
$
|
11,972
|
|
As of August 31, 2021, the Company had $4,201 of unrecognized compensation cost related to 1,583,000 non-vested PSU awards expected to be recognized and vest over a period of approximately 2.25 years.
NOVAGOLD RESOURCES INC.
|
NOTES TO CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
|
(Unaudited, US dollars in thousands except per share amounts)
|
The following table summarizes other PSU-related information:
|
|
Nine months ended August 31,
|
|
|
|
2021
|
|
|
2020
|
|
Performance multiplier on PSUs vested
|
|
|
150
|
%
|
|
|
150
|
%
|
Common shares issued (thousands)
|
|
|
574
|
|
|
|
410
|
|
Total fair value of common shares issued
|
|
$
|
5,723
|
|
|
$
|
2,855
|
|
Withholding tax paid on PSUs vested
|
|
$
|
731
|
|
|
$
|
1,652
|
|
NOTE 12 – NET CHANGE IN OPERATING ASSETS AND LIABILITIES
|
|
Nine months ended August 31,
|
|
|
|
2021
|
|
|
2020
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
Other assets
|
|
$
|
1,403
|
|
|
$
|
667
|
|
Accounts payable and accrued liabilities
|
|
|
(286
|
)
|
|
|
70
|
|
Accrued payroll and related benefits
|
|
|
(473
|
)
|
|
|
(470
|
)
|
|
|
$
|
644
|
|
|
$
|
267
|
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
In Management’s Discussion and Analysis of Financial Condition and Results of Operations, “NOVAGOLD”, the “Company”, “we,” “us” and “our” refer to NOVAGOLD RESOURCES INC. and its consolidated subsidiaries. The following discussion and analysis of our financial condition and results of operations constitutes management’s review of the factors that affected our financial and operating performance for the three- and nine-month periods ended August 31, 2021 and August 31, 2020. This discussion should be read in conjunction with the condensed consolidated financial statements and notes thereto contained elsewhere in this report and our Annual Report on Form 10-K for the year ended November 30, 2020, as well as other information we file with the Securities and Exchange Commission on EDGAR at www.sec.gov and with Canadian Securities Administrators on SEDAR at www.sedar.com. References herein to $ refer to United States dollars and C$ to Canadian dollars.
Overview
Our operations primarily relate to the delivery of project milestones, including the achievement of various technical, environmental, sustainable development, economic and legal objectives, obtaining necessary permits, completion of feasibility studies, preparation of engineering designs and the financing to fund these objectives.
Our goals for 2021 include:
|
●
|
Continue to advance the Donlin Gold project toward a construction decision.
|
|
●
|
Maintain/increase support for Donlin Gold among native entities and other stakeholders.
|
|
●
|
Promote a strong safety, sustainability, and environmental culture.
|
|
●
|
Maintain a favorable reputation of the Company, its governance practices, and its project among shareholders.
|
|
●
|
Manage the Company treasury effectively and efficiently, including streamlining the corporate structure.
|
Third quarter highlights
COVID-19 response
The Company has implemented policies at its offices in Salt Lake City and Vancouver designed to ensure the safety and well-being of all employees and the people associated with them. In that regard, to reduce risk, our employees have been encouraged to get fully vaccinated against COVID-19, asked to work remotely, avoid all non-essential business travel, adhere to good hygiene practices, and engage in physical distancing. Donlin Gold continues to provide COVID relief support in collaboration with Calista Corporation (“Calista”), The Kuskokwim Corporation (TKC), and many tribal governments.
Prior to opening the camp this year, Donlin Gold consulted with its partners Calista and TKC, as well as the home communities of Donlin Gold employees regarding COVID-19 health and safety precautions to protect the workforce and the people of the Yukon-Kuskokwim (Y-K) region. Following a successful 2020 season with zero COVID-19 cases on site, employees and contractors again have mandatory testing for the 2021 season prior to traveling to the Donlin Gold project camp and upon arrival must follow social distancing and other protective requirements. The Donlin Gold office in Anchorage has recently been closed in response to two positive cases discovered in employees there. All Donlin Gold employees who may have been exposed have been tested, are quarantining, and are currently working remotely in accordance with the Donlin Gold COVID-19 Mitigation Plan protocols.
Continuation of the COVID-19 pandemic in 2021 and beyond could impact employee health, workforce productivity, insurance premiums, ability to travel, the availability of industry experts, personnel and equipment, restrictions or delays to field work, studies, and assay results, and other factors that will depend on future developments that may be beyond our control.
Community engagement
To date, Donlin Gold LLC has made progress in formalizing its community relationships with Shared Value Statements covering eight villages from the Y-K region (Akiak, Sleetmute, Napaimute, Crooked Creek, Napaskiak, Nikolai, Tuluksak and Kalskag) that formalize current engagement with key local communities. These agreements include educational, environmental, and social initiatives to help provide support for these villages.
For the 2021 season, Donlin Gold LLC hired employees from 20 Y-K communities. In an area with high unemployment and fewer job choices than in urban environments, the work experience and skills training that Donlin Gold provides is attractive and employees are encouraged to bring their safety knowledge into their home village. Local community involvement in the project is core to both Barrick’s and NOVAGOLD’s philosophy, and approximately 70% of Donlin Gold direct hires for this year’s drill program are Alaska Natives.
As a neighbor to others in the Y-K region and as a team largely made up of people from the area, Donlin Gold strives to aid communities with support and resources, particularly when health and safety are of concern. Donlin Gold is committed to support the needs of its community partners. In August, Donlin Gold held the fourth annual “In It For The Long Haul” backhaul project with approximately 180,000 pounds of hazardous and electronic waste removed from 26 villages throughout the Y-K region.
Permitting
The State’s Clean Water Act (CWA) Section 401 certification (the “401 Certification”) of the Federal CWA Section 404 permit was formally appealed to the Commissioner of the Alaska Department of Environmental Conservation in June 2020, and the ADEC Commissioner referred the appeal to an Administrative Law Judge for review. The appeal focused on three narrow issues related to compliance with the State’s water quality standards near the mine site. On April 12, 2021, the Administrative Law Judge issued his opinion for the Commissioner’s consideration recommending the 401 Certification be vacated. The Commissioner issued his decision to uphold the 401 Certification on May 27, 2021. The decision was appealed on June 28, 2021 in Alaska’s Superior Court by Earthjustice, a San Francisco-based activist law firm, on behalf of Orutsararmiut Native Council (ONC).
In April 2020, the Alaska Department of Natural Resources’ (ADNR) Division of Oil and Gas agreed to reconsider its decision on the State Right-of-Way (ROW) agreement and lease authorization for the buried natural gas pipeline. Under the reconsideration, on September 10, 2020, the ADNR issued for additional public comment a revised Consideration of Comments document. This document describes how the ADNR considered public input that was solicited in the ROW review, including how cumulative effects are addressed in the decision. The comment period on the document ended on November 9, 2020. On July 19, 2021, the ADNR Commissioner completed the reconsideration and upheld the ROW agreement and lease authorization. On August 9, 2021, two parties requested that the Commissioner conduct a further reconsideration. The first party was Earthjustice representing ONC, Cook Inletkeeper, and three villages. The second party was an individual who operates an outdoor guiding business around the pipeline route. The Commissioner rejected both further reconsideration requests on August 19, 2021. On September 20, 2021, Earthjustice, representing ONC, Cook Inletkeeper, and three villages, filed an appeal of the State ROW in Alaska Superior Court. An appeal was also filed by the second party on September 20, 2021.
In November 2020, the ADNR published an initial public notice for comment on Donlin Gold’s 12 applications for water rights for the mine site and transportation facilities, which closed on December 15, 2020. Water rights are for local surface water sources and groundwater to be used for process water, dust control, fire protection, and potable water. In March 2021, the ADNR held a second two-week public notice period, which closed on March 26, 2021. All the final Water Rights were issued on June 29, 2021 by ADNR’s Division of Mining Land and Water. In July, they were administratively appealed to the ADNR Commissioner by Earthjustice, ONC, and five villages. We anticipate a decision on the appeal by the Commissioner in 2022.
Donlin Gold, working with its Native Corporation partners, continues to support the State of Alaska to advance other permits and certificates needed for the project. The field work related to the issuance of the Alaska Dam Safety certificates, which is a multi-year commitment, was temporarily paused to concentrate on the 2020 and 2021 geological drill programs.
Donlin Gold is fortunate to have strong partnerships with Calista and TKC, owners of the mineral and surface rights, respectively. The project’s location on private land specially designated for mining activities through the 1971 Alaska Native Claims Settlement Act. Donlin Gold’s commitment to meaningful tribal consultation throughout project development and permitting has been proven over decades of reliable and dependable engagement with the community.
Donlin Gold project
The 2021 drilling program includes additional confirmation and extension drilling, focusing on further testing, orebody continuity, structural control, and geotechnical and geometallurgical data collection and analysis. In September, 2021, the drilling portion of the program was completed at the Donlin Gold project site in the ACMA and Lewis deposit areas. A total of 79 holes were drilled for a total of approximately 24,200 meters, including an additional 15 holes and 4,000 meters above the original 2021 plan. Assays are anticipated to be completed by early 2022. The newly obtained data will be incorporated into the geologic and resource model and should lead the owners to determine updated mining schedules and life of mine business plans. The focus will then shift to feasibility study work, subject to a formal decision by the Donlin Gold Board, and ultimately, to initiate the engineering work necessary to advance the project design before reaching a construction decision. The owners will advance the Donlin Gold project in a financially disciplined manner with a strong focus on engineering excellence, environmental stewardship, a strong safety culture and continued community engagement.
Our share of funding for the Donlin Gold project in the first nine months of 2021 was $15 million. We expect our total 2021 share of Donlin Gold LLC funding to be $19 million, including: $12 million for follow-up drilling, camp improvements, and studies and $7 million for permitting, community engagement and administration.
The Donlin Gold LLC board must approve a construction program and budget before the Donlin Gold project can be developed. The timing of the required engineering work and the Donlin Gold LLC board’s approval of a construction program and budget, the receipt of all required governmental permits and approvals, and the availability of financing, commodity price fluctuations, risks related to market events and general economic conditions among other factors, will affect the timing of and whether to develop the Donlin Gold project. Among other reasons, project delays could occur as a result of public opposition, litigation challenging permit decisions, requests for additional information or analysis, limitations in agency staff resources during regulatory review and permitting, project changes made by Donlin Gold LLC, or any impact on operations from COVID-19.
We record our interest in the Donlin Gold project as an equity investment, which results in our 50% share of Donlin Gold’s expenses being recorded in the income statement as an operating loss. The investment amount recorded on the balance sheet primarily represents unused funds advanced to Donlin Gold.
Outlook
We do not currently generate operating cash flows. As of August 31, 2021, we had cash and cash equivalents of $117.8 million and term deposits of $55.5 million. Our anticipated expenditures in 2021 are $32 million, including $19 million to fund the Donlin Gold project and $13 million for corporate general and administrative costs. At present, we believe we have sufficient working capital available for the next twelve-month period to cover anticipated funding of the Donlin Gold project and corporate general and administrative costs.
Additional capital will be necessary if a decision to commence engineering and construction is reached for the Donlin Gold project. Future financings to fund construction are anticipated through debt, equity, project specific debt, and/or other means. Our continued operations are dependent on our ability to obtain additional financing or to generate future cash flows. However, there can be no assurance that we will be successful in our efforts to raise additional capital on terms favorable to us, or at all. For further information, see the risk factors in our Annual Report on Form 10-K for the year ended November 30, 2020, as filed with the SEC and the Canadian Securities Regulators on January 29, 2021.
Summary of Consolidated Financial Performance
|
|
Three months ended August 31,
|
|
|
Nine months ended August 31,
|
|
($ thousands, except per share)
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
General and administrative
|
|
$
|
(4,883
|
)
|
|
$
|
(4,745
|
)
|
|
$
|
(15,204
|
)
|
|
$
|
(13,846
|
)
|
Equity loss - Donlin Gold
|
|
|
(6,748
|
)
|
|
|
(6,150
|
)
|
|
|
(12,914
|
)
|
|
|
(11,418
|
)
|
Loss from operations
|
|
$
|
(11,631
|
)
|
|
$
|
(10,895
|
)
|
|
$
|
(28,118
|
)
|
|
$
|
(25,264
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss
|
|
$
|
(11,790
|
)
|
|
$
|
(12,736
|
)
|
|
$
|
(30,267
|
)
|
|
$
|
(26,564
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share – basic and diluted
|
|
$
|
(0.04
|
)
|
|
$
|
(0.04
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(0.08
|
)
|
Results of Operations
Third quarter 2021 compared to 2020
Loss from operations increased from $10.9 million in 2020 to $11.6 million in 2021 due to higher permitting and legal costs at Donlin Gold LLC.
Net loss decreased from $12.7 million ($0.04 per share) in 2020 to $11.8 million ($0.04 per share) in 2021, primarily due to foreign exchange movements, partially offset by lower interest income and changes in the fair market value of marketable securities.
First nine months 2021 compared to 2020
Loss from operations increased from $25.3 million in 2020 to $28.1 million in 2021 due to higher general and administrative expense and higher costs at Donlin Gold LLC. General and administrative expense increased by $1.4 million primarily due to higher share-based compensation, salaries and benefits. At Donlin Gold, expenses increased by $1.5 million in 2021 due to higher permitting and legal costs.
Net loss increased from $26.6 million ($0.08 per share) in 2020 to $30.3 million ($0.09 per share) in 2021, primarily due to higher operating losses and lower interest income, partially offset by lower interest expense on the promissory note payable to Barrick.
Liquidity, Capital Resources and Capital Requirements
|
|
As of
|
|
|
As of
|
|
|
|
|
|
($ thousands)
|
|
August 31,
2021
|
|
|
November 30,
2020
|
|
|
Change
|
|
Cash and cash equivalents
|
|
$
|
117,793
|
|
|
$
|
60,906
|
|
|
$
|
56,887
|
|
Term deposits
|
|
|
55,548
|
|
|
|
61,000
|
|
|
|
(5,452
|
)
|
|
|
$
|
173,341
|
|
|
$
|
121,906
|
|
|
$
|
51,435
|
|
In the first nine months of 2021, total Cash, cash equivalents and Term deposits increased by $51.4 million due to the receipt of $75 million from Newmont, partially offset by $15.0 million used to fund Donlin Gold, $8.4 million used in operating activities for administrative costs and working capital changes, and $0.7 million related to withholding taxes paid on vested performance share units (PSUs). Effects of exchange rate changes increased cash by $0.6 million. The term deposits are denominated in U.S. or Canadian dollars and are held at Canadian chartered banks.
Under the terms of the sale of the Galore Creek project to Newmont, NOVAGOLD received $100 million on July 27, 2018. An additional $75 million was received on July 27, 2021. A further $25 million is due upon the earlier of: (i) completion of a project feasibility study prepared by or for Galore Creek project, or (ii) July 27, 2023. Also, an additional $75 million payment is contingent upon Galore Creek project construction approval.
|
|
Three months ended August 31,
|
|
|
Nine months ended August 31,
|
|
($ thousands)
|
|
2021
|
|
|
2020
|
|
|
2021
|
|
|
2020
|
|
Net cash provided from (used in):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating activities
|
|
$
|
(1,877
|
)
|
|
$
|
(1,826
|
)
|
|
$
|
(8,139
|
)
|
|
$
|
(7,157
|
)
|
Investing activities
|
|
|
68,099
|
|
|
$
|
(6,693
|
)
|
|
|
65,176
|
|
|
$
|
(13,583
|
)
|
Financing activities
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
(731
|
)
|
|
$
|
(1,652
|
)
|
Third quarter 2021 compared to 2020
Net cash used in operating activities increased by $0.1 million, primarily due to lower interest income. Net cash provided from (used in) investing activities includes the $75.0 million note payment from Newmont, partially offset by a $0.2 million increase in Donlin Gold funding.
First nine months 2021 compared to 2020
Net cash used in operating activities increased by $1.0 million, primarily due to lower interest income. Net cash provided from (used in) investing activities includes the $75.0 million note payment from Newmont and net proceeds of $5.2 million from term deposits in 2021, partially offset by a $1.4 million increase in Donlin Gold funding. Net cash used in financing activities related to withholding taxes paid on vested performance share units.
Outstanding share data
As of September 22, 2021, the Company had 331,677,553 common shares issued and outstanding. Also, as of September 22, 2021, the Company had: i) a total of 10,435,803 stock options outstanding; 9,001,405 with a weighted-average exercise price of $5.27 and the remaining 1,434,398 of those stock options with a weighted-average exercise price of C$6.84; and ii) 1,583,100 PSUs and 306,321 deferred share units outstanding. Upon exercise or pay out, as applicable, of the foregoing convertible securities, the Company would be required to issue a maximum of 13,116,774 common shares.