TIDMAEXG
RNS Number : 2716X
AEX Gold Inc
27 August 2020
("AEX" or the "Corporation")
AEX Gold Inc. Reports Second Quarter Financial Results
TORONTO, ONTARIO - AUGUST 27, 2020 - AEX Gold Inc. (AIM: AEXG;
TSXV: AEX), an independent gold company with a portfolio of gold
licences in Greenland, announces its unaudited condensed interim
consolidated financial statements ("Financial Statements") for the
quarter ended June 30, 2020. All figures are in Canadian dollars
unless otherwise noted.
The Financial Statements and the accompanying Management
Discussion and Analysis are available on the Corporation's website
at www.aexgold.com and will be filed under the Corporation's SEDAR
profile at
www.sedar.com later today .
Financial Highlights
-- The Corporation reported a net loss of $3.4 million in H1
2020 (H1 2019: $1.1 million), driven by increased exploration and
evaluation activities and corporate activity during the period, as
well as non-cash stock based compensation.
-- Exploration and evaluation expenses during the period were
$1.5 million (H1 2019: $0.6 million), driven by increased activity
on the Nalunaq Property and its regional exploration portfolio.
-- General and administrative expenses during the period were
$0.9 million (H1 2020: $0.5 million), with the increase a result of
higher management, consulting and professional fees as the
Corporation moves towards development at Nalunaq and ahead of its
AIM listing.
-- During the period, 11,387,626 warrants were exercised, each
entitling the holder to receive one common share of the
Corporation, at an exercise price per warrant between $0.45 and
$0.50, with the Corporation receiving gross proceeds of $5.1
million.
-- The Corporation granted 2,195,000 options to its directors,
officers and consultants, based on an estimated fair value of $0.47
per option, representing a total non-cash cost of $1.0 million in
the period.
-- The Corporation had a cash balance of $4.4 million at June
30, 2020 ($1.5 million at December 31, 2019), with no debt, and
total working capital of $3.0 million ($1.2 million at December 31,
2019).
-- Post-period end, the Corporation completed an equity placing
raising gross proceeds of $72.7 million (GBP42.5 million).
Selected Financial Information
The following selected financial data is extracted from the
Financial Statements for the six months ended June 30, 2020.
Financial Results
Three months Six months
ended June 30, ended June 30,
2020 2019 2020 2019
$ $ $ $
----------- --------- ----------- -----------
Exploration and evaluation
expenses 912,676 397,220 1,524,451 565,822
General and administrative 498,639 277,335 881,550 493,796
Net loss and comprehensive
loss (2,442,132) (673,725) (3,408,569) (1,075,130)
Basic and diluted loss per
common share (0.03) (0.01) (0.04) (0.02)
----------- --------- ----------- -----------
Financial Position
As at June 30, 2020 As at December 31,
2019
$ $
------------------- ------------------
Cash on hand 4,441,089 1,515,406
Total assets 6,547,834 2,720,473
Total current liabilities 1,682,113 645,933
Shareholders' equity 4,865,721 2,074,540
Working capital 2,978,497 1,157,012
------------------- ------------------
Corporate and Operational Highlights
-- A business readiness program was initiated internally during
the period as the Corporation increases its overall readiness for
transitioning towards project execution, including human resources,
recruiting, environmental and social impact assessment scoping,
organizational structuring, project and cost control, and
accounting.
-- In June 2020, the Greenlandic COVID Commission approved AEX's
mobilization plan and on August 15, 2020 the Corporation
successfully and safely mobilized its expatriate and local
Greenlandic workforce on site at the Nalunaq Property ahead of the
commencement of the 2020 summer work program.
-- During the period, the Corporation was granted two new
Mineral Exploration Licences in South Greenland, namely Saarloq and
Anoritooq, covering an area totalling 2,528km(2) , taking the
Corporations full license area to 3,356km(2) . The Corporation
intends to conduct exploration activities over these new licence
areas, as well as it's wider regional portfolio, as part of the
2020 summer work program announced on August 24, 2020.
Post Period-End
-- On July 27, 2020, the Corporation appointed Sigurbjorn
("Siggi") Thorkelsson as an independent non-executive director of
the Corporation and Chair of the Audit and Risk Committee. Mr.
Thorkelsson brings a wealth of experience in the financial markets,
having worked at major financial institutions throughout his
career.
-- On July 31, 2020, the Corporation completed its AIM Admission
in addition to its existing TSX-V listing, with the issue of
94,444,445 common shares at a price of GBP 0.45 (C$0.77) per
share.
-- The Corporation has progressed a number of discussions with
non-equity financing providers, as detailed at the time of the
fundraise in July 2020. The Board believes a modest non-equity
facility offers an attractive opportunity to access additional
capital to expand value creation activities across its portfolio
without the dilution or costs of further equity. The Corporation is
committed to securing the most attractive source of funding, and
will provide an update on these discussions once a committed
facility is secured.
Eldur Olafsson, CEO of AEX, commented:
"I'm pleased to announce our H1 2020 financial results, which
demonstrate the significant increase in activity across our
portfolio as our business transitions towards development.
"Following the successful $72.7 million fundraise and AIM
listing in July 2020, the Company is in a very strong position and
we are now funded for our planned work program at Nalunaq, where we
are progressing well with the exploration and pre-development work
on the asset. In addition to this, we are undergoing additional
exploration work across our wider portfolio in Southern Greenland
where we believe there is significant upside for investors in what
is a materially undeveloped region.
"We look forward to providing updates to the market on these
exciting workstreams in due course."
"As stated at the time of the fundraise, we are looking to
secure additional non-equity funding in the form of a modest
working capital facility, vendor financing or similar, to
accelerate exploration activities across our material portfolio of
gold assets in South Greenland. Whilst we will look to execute on
this facility as soon as possible, we are in a very strong position
post-fundraise and will take time to ensure that any facility we
enter into offers the best terms to our company and shareholders,
and look forward to updating the market at the appropriate
time."
Enquiries:
AEX Gold Inc.
George Fowlie, Director and CFO
1-416-587-9801
gf@aexgold.com
Eldur Olafsson, Director and CEO
+354 665 2003
eo@aexgold.com
Stifel Nicolaus Europe Limited (Nominated Adviser and
Broker)
Callum Stewart
Simon Mensley
Ashton Clanfield
+44 (0) 20 7710 7600
Camarco (Financial PR)
Gordon Poole
Nick Hennis
+44 (0) 20 3757 4980
AEX Gold Inc: Unaudited Condensed Interim Consolidated Financial
Statements for the Six Months Ended June 30, 2020
Consolidated Statements of Financial Position
(Unaudited, in Canadian Dollars)
As at As at December
June 30, 31,
Notes 2020 2019
-------------------------------------------- ----- ------------ ---------------
$ $
ASSETS
Current assets
Cash 4,441,089 1,515,406
Escrow account for environmental monitoring 186,282 174,864
Sales tax receivable 31,859 17,792
Prepaid expenses and others 1,380 94,883
Total current assets 4,660,610 1,802,945
Non-current assets
Deferred share issuance costs 9 1,221,138 166,348
Escrow account for environmental monitoring 357,618 342,132
Mineral properties 3 55,682 41,945
Property and equipment 4 252,786 367,103
Total non-current assets 1,887,224 917,528
-------------------------------------------- ----- ------------ ---------------
TOTAL ASSETS 6,547,834 2,720,473
-------------------------------------------- ----- ------------ ---------------
LIABILITIES AND EQUITY
Current liabilities
Trade and other payables 1,495,831 471,069
Environmental monitoring provision 186,282 174,864
-------------------------------------------- ----- ------------ ---------------
Total liabilities 1,682,113 645,933
-------------------------------------------- ----- ------------ ---------------
Equity
Capital stock 20,084,129 13,883,611
Warrants 5 238,749 1,459,604
Contributed surplus 2,755,487 1,535,400
Accumulated other comprehensive loss (36.772) (36,772)
Deficit (18,175,872) (14,767,303)
-------------------------------------------- ----- ------------ ---------------
Total equity 4,865,721 2,074,540
-------------------------------------------- ----- ------------ ---------------
TOTAL LIABILITIES AND EQUITY 6,547,834 2,720,473
-------------------------------------------- ----- ------------ ---------------
Going concern 1
Subsequent events 9
The accompanying notes are an integral part of these unaudited
condensed interim consolidated financial statements.
Consolidated Statements of Comprehensive Loss
( Unaudited, i n Canadian Dollars)
Three months Six months
ended June 30, ended June 30,
------------------------------------ ----- ------------------------ ------------------------
Notes 2020 2019 2020 2019
------------------------------------ ----- ------------ ---------- ----------- -----------
$ $ $ $
Expenses
Exploration and evaluation expenses 7 912,676 397,220 1,524,451 565,822
General and administrative 8 498,639 277,335 881,550 493,796
Stock-based compensation 6 1,031,650 - 1,031,650 -
Foreign exchange loss (gain) 3,830 1,773 (21,567) 17,935
Operating loss 2,446,795 676,328 3,416,084 1,077,553
Other expenses (income)
Interest income (4,873) (4,765) (9,915) (7,065)
Finance costs 210 2,162 2,400 4,642
------------------------------------ ----- ------------ ---------- ----------- -----------
Net loss and comprehensive loss (2,442,132) (673,725) (3,408,569) (1,075,130)
------------------------------------ ----- ------------ ---------- ----------- -----------
Weighted average number of common
shares outstanding - basic and
diluted 81,176,725 58,222,276 77,307,646 58,006,586
Basic and diluted loss per common
share (0.03) (0.01) (0.04) (0.02)
------------------------------------ ----- ------------ ---------- ----------- -----------
The accompanying notes are an integral part of these unaudited
condensed interim consolidated financial statements.
C onsolidated Statements of Changes in Equity
(Unaudited, i n Canadian Dollars)
Accumulated
Number of other
common shares Capital Contributed comprehensive Total
Notes outstanding Stock Warrants surplus loss Deficit Equity
-------------- -------- -------------- ---------- --------- ----------- ------------- ------------ -----------
$ $ $ $ $ $
Balance at January
1, 2019 57,788,499 10,058,355 321,788 956,800 (36,772) (9,665,197) 1,634,974
Net loss and
comprehensive
loss - - - - - (1,075,130) (1,075,130)
Shares and warrants
issuance under private
placements 13,157,895 3,853,718 1,146,282 - - - 5,000,000
Share issuance costs - (28,462) (8,466) - - - (36,928)
------------------------ -------------- ---------- --------- ----------- ------------- ------------ -----------
Balance at June
30, 2019 70,946,394 13,883,611 1,459,604 956,800 (36,772) (10,740,327) 5,522,916
------------------------ -------------- ---------- --------- ----------- ------------- ------------ -----------
Notes
Balance
at January
1, 2020 70,946,394 13,883,611 1,459,604 1,535,400 (36,772) (14,767,303) 2,074,540
Net loss
and comprehensive
loss - - - - - (3,408,569) (3,408,569)
Warrants
exercised 5 11,387,626 6,140,518 (1,010,418) - - - 5,130,100
Warrants
expired 5 - - (210,437) 210,437 - - -
Options
exercised 6 100,000 60,000 - (22,000) - - 38,000
Stock-based
compensation 6 - - - 1,031,650 - - 1,031,650
------------------- ----- ---------- ---------- ----------- ---------- -------- ------------ -----------
Balance
at June
30, 2020 82,434,020 20,084,129 238,749 2,755,487 (36,772) (18,175,872) 4,865,721
------------------- ----- ---------- ---------- ----------- ---------- -------- ------------ -----------
The accompanying notes are an integral part of these unaudited
condensed interim consolidated financial statements.
Consolidated Statements of Cash Flows
( Unaudited, i n Canadian Dollars)
Six months
Notes ended June 30,
----------------------------------------------- ----- ------------------------
2020 2019
----------------------------------------------- ----- ----------- -----------
$ $
Operating activities
Net loss for the period (3,408,569) (1,075,130)
Adjustments for:
Depreciation 4 114,317 82,863
Stock-based compensation 6 1,031,650 -
Finance costs 2,400 4,642
Payment from cash held in escrow account
for environmental monitoring - (28,846)
Escrow account for environmental monitoring - 28,846
Foreign exchange loss (gain) (19,112) 19,380
----------------------------------------------- ----- ----------- -----------
(2,279,314) (968,245)
Changes in non-cash working capital items:
Sales tax receivable (14,067) (13,215)
Prepaid expenses and others 93,561 1,467
Trade and other payables 293,916 271,621
Payables to shareholders - 4,762
----------------------------------------------- ----- ----------- -----------
373,410 264,635
----------------------------------------------- ----- ----------- -----------
Cash flow used in operating activities (1,905,904) (703,610)
----------------------------------------------- ----- ----------- -----------
Investing activities
Acquisition of mineral properties 3 (13,737) -
Acquisition of property and equipment - (10,514)
Cash flow used in investing activities (13,737) (10,514)
----------------------------------------------- ----- ----------- -----------
Financing activities
Shares and warrants issuance - 5,000,000
Share issuance costs - (750)
Exercise of warrants 5 5,130,100 -
Exercise of stock options 6 38,000 -
Deferred share issuance costs 9 (324,293) -
Cash flow from financing activities 4,843,807 4,999,250
----------------------------------------------- ----- ----------- -----------
Net change in cash before effects of exchange
rate changes on cash during the period 2,924,166 4,285,126
Effects of exchange rate changes on cash 1,517 (3,447)
----------------------------------------------- ----- ----------- -----------
Net change in cash during the period 2,925,683 4,281,679
Cash, beginning of period 1,515,406 963,788
----------------------------------------------- ----- ----------- -----------
Cash, end of period 4,441,089 5,245,467
----------------------------------------------- ----- ----------- -----------
Supplemental cash flow information
Interest received 9,915 7,065
S hare issuance costs included in trade and
other payables - 36,178
Acquisition of mineral properties included
in trade and other payables - -
Exercise of warrants credited to capital
stock 1,010,418 -
Exercise of stock options credited to capital
stock 22,000 -
Deferred share issuance costs included in
trade and other payables 851,228 -
The accompanying notes are an integral part of these unaudited
condensed interim consolidated financial statements.
Condensed Notes to the interim Consolidated Financial
Statements
Six months ended June 30, 2020 and 2019
( Unaudited, i n Canadian Dollars)
1. NATURE OF OPERATIONS, BASIS OF PRESENTATION AND GOING CONCERN
AEX Gold Inc. (the "Corporation") was incorporated on February
22, 2017 under the Canada Business Corporations Act. The
Corporation's head office is situated at 3400, One First Canadian
Place, P.O. Box 130, Toronto, Ontario, M5X 1A4, Canada . The
Corporation operates in one industry segment, being the
acquisition, exploration and development of mineral properties. It
owns interests in properties located in Greenland. The
Corporation's financial year ends on December 31. Since July 2017,
the Corporation's shares are listed on the TSX Venture Exchange
(the "TSX-V") under the AEX ticker and since July 2020, the
Corporation's shares are also listed on the AIM market of the
London Stock Exchange ("AIM") under the AEXG ticker (note 9).
These unaudited condensed interim consolidated financial
statements for the six months ended June 30, 2020 ("Financial
Statements") were approved by the Board of Directors on August 26,
2020.
1.1 Basis of presentation
The Financial Statements have been prepared in accordance with
International Financial Reporting Standards ("IFRS") as issued by
the International Accounting Standards Board ("IASB") including
International Accounting Standard ("IAS") 34, Interim Financial
Reporting. The Financial Statements have been prepared under the
historical cost convention.
The Financial Statements should be read in conjunction with the
annual financial statements for the year ended December 31, 2019
which have been prepared in accordance with IFRS as issued by the
IASB. The accounting policies, methods of computation and
presentation applied in these Financial Statements are consistent
with those of the previous financial year ended December 31,
2019.
1.2 Going concern
The Financial Statements were prepared using IFRS applicable to
a going concern, which contemplates the realization of assets and
settlement of liabilities in the normal course of business as they
come due. In assessing whether the going concern assumption is
appropriate, senior management of the Corporation ("Management")
takes into account all available information about the future,
which is at least, but not limited to, twelve months from the end
of the reporting period. Management is aware in making its
assessment of material uncertainties related to events and
conditions that lend a significant doubt upon the Corporation'
ability to continue as a going concern and accordingly, the
appropriateness of the use of IFRS applicable to a going concern,
as described in the following paragraph. The Financial Statements
do not reflect the adjustment to the carrying values of assets and
liabilities, expenses and financial position classifications that
would be necessary if the going concern assumption would not be
appropriate. These adjustments could be material.
The Corporation recorded a loss of $3,408,569 for the six months
ended June 30, 2020 and has an accumulated deficit of $18,175,872
as at June 30, 2020. In addition to ongoing working capital
requirements, the Corporation must secure sufficient funding to
meet its other obligations, existing commitments for the
exploration and evaluation programs and pay general and
administration costs. As at June 30, 2020, the Corporation had
working capital of $2,978,497. These conditions indicate the
existence of material uncertainties t hat may cast a significant
doubt regarding the Corporation' ability to continue as a going
concern.
The Corporation' ability to continue as a going concern is
dependent upon its ability to raise additional financing to further
explore its mineral properties. The completion of the fundraising
in July 2020 discussed in subsequent events (note 9), contributed
to such financing. While Management has secured financing in the
past, there can be no assurance it will be able to do so in the
future or that these sources of funding or initiatives will be
available for the Corporation or that they will be available on
terms which are acceptable to the Corporation. If Management is
unable to obtain new funding, the Corporation may be unable to
continue its operations, and amounts realized for assets might be
less than amounts reflected in these Financial Statements and this
could have a significant impact on the financial position of the
Corporation, its financial performance and its cash flows.
The measurement of certain assets and liabilities is dependent
on future events; therefore the preparation of these Financial
Statements requires the use of estimates, which may vary from
actual results. The success of the Corporation' exploration and
evaluation activities is influenced by significant financial risks,
legal and political risks, commodity prices, and the ability of the
Corporation to discover economically recoverable reserves.
During the first half of 2020, an outbreak of a new strain of
coronavirus (COVID-19) resulted in a major global health crisis
which continues to have impacts on the global economy and the
financial markets at the date of completion of the Financial
Statements. These events may cause significant changes on the
Corporation's ability to complete planned exploration and
evaluation activities in the future, meet its other obligations and
existing commitments for the exploration and evaluation programs or
our ability to obtain debt and equity financing. Following these
events, the Corporation has taken and will continue to take action
to minimize the impact of the COVID-19 pandemic. However, it is
impossible to ultimately determine the financial implications of
these events.
2. CRITICAL ACCOUNTING JUDGMENTS AND ASSUMPTIONS
The preparation of the Financial Statements requires Management
to make judgments and form assumptions that affect the reported
amounts of assets and liabilities at the date of the Financial
Statements and reported amounts of expenses during the reporting
period. On an ongoing basis, Management evaluates its judgments in
relation to assets, liabilities and expenses. Management uses
historical experience and various other factors it believes to be
reasonable under the given circumstances as the basis for its
judgments. Actual outcomes may differ from these estimates under
different assumptions and conditions.
In preparing the Financial Statements, the significant
judgements made by Management in applying the Corporation
accounting policies and the key sources of estimation uncertainty
were the same as those that applied to the Corporation's audited
annual financial statements for the year ended December 31, 2019.
Estimates and assumptions are continually evaluated and are based
on historical experience and other factors, including expectations
of future events that are believed to be reasonable under the
circumstances.
3. MINERAL PROPERTIES
As at December
31, 2019 As at
June 30,
Additions 2020
------------------------- -------------- --------- ---------
$ $ $
Nalunaq 1 - 1
Tartoq 18,431 - 18,431
Vagar 11,103 - 11,103
Naalagaaffiup Portornga 6,334 - 6,334
Nuna Nutaaq 6,076 - 6,076
Saarloq - 7,348 7,348
Anoritooq - 6,389 6,389
Total mineral properties 41,945 13,737 55,682
------------------------- -------------- --------- ---------
As at December As at December
31, 2018 31,
Additions 2019
------------------------- -------------- --------- --------------
$ $ $
Nalunaq 1 - 1
Tartoq 18,431 - 18,431
Vagar 11,103 - 11,103
Naalagaaffiup Portornga 6,334 - 6,334
Nuna Nutaaq - 6,076 6,076
Total mineral properties 35,869 6,076 41,945
------------------------- -------------- --------- --------------
4. PROPERTY AND EQUIPMENT
Exploration and evaluation
Field equipment and Vehicles and rolling stock Equipment Total
infrastructure
$ $ $ $
------------------------------- ------------------------------ --------------------------- ---------- ----------
Six months ended June 30, 2020
Opening net book value 271,977 86,656 8,470 367,103
Additions - - - -
Depreciation (64,554) (48,011) (1,752) (114,317)
------------------------------- ------------------------------ --------------------------- ---------- ----------
Closing net book value 207,423 38,645 6,718 252,786
As at June 30, 2020
Cost 387,323 288,066 10,514 685,903
Accumulated depreciation (179,900) (249,421) (3,796) (433,117)
------------------------------- ------------------------------ --------------------------- ---------- ----------
Closing net book value 207,423 38,645 6,718 252,786
------------------------------- ------------------------------ --------------------------- ---------- ----------
Depreciation of property and equipment related to exploration
and evaluation properties is being recorded in exploration and
evaluation expenses in the consolidated statement of comprehensive
loss, under depreciation. Depreciation of $114,317 was expensed as
exploration and evaluation expenses during the six months ended
June 30, 2020.
5. WARRANTS
5.1 Warrants
Changes in the Corporation's warrants are as follow:
Six months ended June 30, 2019
2020
------------------- ---------------------------------- ----------------------------------
Weighted Weighted
average average
Number Carrying exercise Number Carrying exercise
of warrants Value price of warrants Value price
------------------- ------------ --------- --------- ------------ --------- ---------
$ $ $ $
Balance, beginning 13,157,895 1,137,816 0.45 - - -
Issued - - - 13,157,895 1,137,816 0.45
Exercised (11,272,271) (974,758) 0.45 - - -
Expired (1,885,624) (163,058) 0.45 - - -
------------ --------- ---------
Balance, end - - - 13,157,895 1,137,816 0.45
------------------- ------------ --------- --------- ------------ --------- ---------
The Corporation has accelerated the expiry of certain common
share purchase warrants ("Warrants"), bearing an expiration date of
June 28, 2022. The certificate evidencing the Warrants ("Warrant
Certificate") provided for acceleration in certain circumstances,
which were met during the period. From the period February 6, 2020
to March 5, 2020, the daily volume weighted average price of the
Corporation's common shares on the TSX-V was equal to or greater
than $0.50, thus satisfying the acceleration requirements under the
Warrants. Accordingly, Warrant holders were provided with
notification that any Warrants that were not exercised before April
20, 2020, being the 30(th) trading day following the occurrence of
the acceleration event, would expire and be cancelled. Certain
Warrant holders exercised 11,272,271 Warrants, each entitling the
holder to receive one common share of the Corporation, at an
exercise price per warrant of $0.45, representing gross proceeds of
$5,072,522.
5.2 Agent warrants
Changes in the Corporation's agent and finders warrants are as
follow:
Six months ended June 30, 2019
2020
------------------- --------------------------------- ---------------------------------
Weighted Weighted
average average
Number Carrying exercise Number Carrying exercise
of warrants Value price of warrants Value price
------------------- ------------ -------- --------- ------------ -------- ---------
$ $ $ $ $
Balance, beginning 1,067,739 321,788 0.49 1,067,739 321,788 0.49
Exercised (115,355) (35,660) 0.50 - - -
Expired (182,227) (47,379) 0.45 - - -
------------------- ------------ -------- --------- ------------ -------- ---------
Balance, end 770,157 238,749 0.50 1,067,739 321,788 0.49
------------------- ------------ -------- --------- ------------ -------- ---------
Agent and finders warrants outstanding and exercisable as at
June 30, 2020 are as follows:
Number of warrants
outstanding and exercisable Exercise price Expiry date
---------------------------- -------------- -------------
$
770,157 0.50 July 13, 2020
---------------------------- -------------- -------------
6. STOCK OPTIONS
An incentive stock option plan (the "Plan") was approved
initially in 2017 and renewed by shareholders on June 17, 2020. The
Plan is a "rolling" plan whereby a maximum of 10% of the issued
shares at the time of the grant are reserved for issue under the
Plan to executive officers and directors, employees and
consultants. The Board of directors attributes the stock options
and the exercise price of the options shall not be less than the
closing price on the last trading day preceding the grant date. The
options have a maximum term of ten years. Options granted pursuant
to the Plan shall vest and become exercisable at such time or times
as may be determined by the Board, except options granted to
consultants providing investor relations activities shall vest in
stages over a 12 month period with a maximum of one-quarter of the
options vesting in any three-month period. The Corporation has no
legal or constructive obligation to repurchase or settle the
options in cash.
On June 17, 2020, the Corporation granted to its directors,
officers and consultants 2,195,000 stock options exercisable at an
exercise price of $0.70, with an expiry date of December 31, 2026.
The stock options vested 100% at the grant date. Those options were
granted at an exercise price equal the closing market value of the
shares the previous day of the grant. Total stock-based
compensation costs amount to $1,031,650 for an estimated fair value
of $0.47 per option. The fair value of the options granted was
estimated using the Black-Scholes model with no expected dividend
yield, 76.41% expected volatility, 0.41% risk-free interest rate
and 6.5 years options expected life. The expected life and expected
volatility were estimated by benchmarking comparable companies to
the Corporation.
Changes in stock options are as follow:
Six months ended
June 30, 2020 2019
------------------- ---------------------------- ----------------------------
Weighted Weighted
Number of average exercise Number of average exercise
options price options price
------------------- --------- ----------------- --------- -----------------
$ $
Balance, beginning 5,650,000 0.43 3,020,000 0.47
Granted 2,195,000 0.70 2,630,000 0.38
Exercised (100,000) 0.38 - -
Balance, end 7,745,000 0.51 5,650,000 0.43
------------------- --------- ----------------- --------- -----------------
Stock options outstanding and exercisable as at June 30, 2020
are as follows:
Number of options
outstanding and Exercise
exercisable price Expiry date
----------------- -------- -----------------
$
1,360,000 0.50 July 13, 2022
1,660,000 0.45 August 22, 2023
2,530,000 0.38 December 31, 2025
2,195,000 0.70 December 31, 2026
----------------- -------- -----------------
7,745,000
----------------- -------- -----------------
7. EXPLORATION AND EVALUATION EXPENSES
Three months Six months
ended June 30, ended June 30,
---------------------------- -------------------- --------------------
2020 2019 2020 2019
---------------------------- --------- --------- ----------- -------
$ $ $ $
Geology 524,863 262,113 795,423 361,727
Lodging and on-site support 3,663 - 3,663 -
Underground works 23,040 - 45,847 -
Drilling 33,950 - 33,315 -
Safety and environment 6,568 - 6,568 -
Analysis 43,205 12,088 67,068 14,580
Transport 9,923 5,725 70,656 5,725
Logistic support 84,223 60,939 162,710 79,889
Insurance 3,287 - 4,513 -
Maintenance infrastructure 102,442 - 187,297 -
Government fees 20,353 14,778 33,074 21,038
Depreciation 57,159 41,577 114,317 82,863
---------------------------- --------- --------- ----------- -------
Exploration and evaluation
expenses 912,676 397,220 1,524,451 565,822
---------------------------- --------- --------- ----------- -------
8. GENERAL AND ADMINISTRATION
Three months Six months
ended June 30, ended June 30,
--------------------------- ------------------ ------------------
2020 2019 2020 2019
--------------------------- -------- -------- -------- --------
$ $ $ $
Management and consulting
fees 166,369 70,427 282,441 139,800
Director's fees 25,000 18,750 50,000 18,750
Professional fees 194,349 104,405 318,104 186,705
Marketing and industry
involvement 60,606 33,503 146,981 61,821
Insurance 10,561 10,088 21,122 20,180
Travel and other expenses 16,606 30,840 31,180 48,265
Regulatory fees 25,148 9,322 31,722 18,275
--------------------------- -------- -------- -------- --------
General and administration 498,639 277,335 881,550 493,796
--------------------------- -------- -------- -------- --------
9. SUBSEQUENT EVENTS
AIM listing
As of June 30, 2020, the Corporation was considering an
additional listing on the AIM market of the London Stock Exchange,
alongside its current listing on the TSX-V. As at June 30, 2020,
the Corporation had incurred deferred share issuance costs of
$1,221,138 as part of this process.
The admission of its entire issued share capital to trading on
the AIM market occurred and dealings commenced on AIM on July 31,
2020 ("Admission") under the ticker AEXG.
Completion of the fundraising
On July 31, 2020, the Corporation completed the fundraising by
issuing 94,444,445 common shares at a price of $0.77 (GBP 0.45) per
share, for gross proceeds to the Corporation of $72,722,223 (GBP
42,500,000) ("Fundraising") .
Stifel Nicolaus Europe Limited ("Stifel") acted as nominated
adviser, broker and bookrunner to the Corporation in connection
with the Fundraising and Admission. Cormark Securities Inc. and
Paradigm Capital Inc. acted as co-managers in connection with the
Fundraising (the "Agents").
Further Information:
About AEX
AEX's principal business objectives are the identification,
acquisition, exploration and development of gold properties in
Greenland. The Corporation's principal asset is a 100% interest in
the Nalunaq Project, an advanced exploration stage property with an
exploitation license including the previously operating Nalunaq
gold mine. The Corporation has a portfolio of gold assets covering
3,356km(2) , the largest portfolio of gold assets in Southern
Greenland covering the two known gold belts in the region. AEX is
incorporated under the Canada Business Corporations Act and wholly
owns Nalunaq A/S, incorporated under the Greenland Public Companies
Act.
Forward-Looking Information
This press release contains forward-looking information within
the meaning of applicable securities legislation, which reflects
the Corporation's current expectations regarding future events and
the future growth of the Corporation's business. In this press
release there is forward-looking information based on a number of
assumptions and subject to a number of risks and uncertainties,
many of which are beyond the Corporation's control, that could
cause actual results and events to differ materially from those
that are disclosed in or implied by such forward-looking
information. Such risks and uncertainties include, but are not
limited to the factors discussed under "Risk Factors" in the Final
Prospectus available under the Corporation's profile on SEDAR at
www.sedar.com. Any forward-looking information included in this
press release is based only on information currently available to
the Corporation and speaks only as of the date on which it is made.
Except as required by applicable securities laws, the Corporation
assumes no obligation to update or revise any forward-looking
information to reflect new circumstances or events. No securities
regulatory authority has either approved or disapproved of the
contents of this press release. Neither TSX Venture Exchange nor
its Regulation Services Provider (as that term is defined in
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
Inside Information
This announcement contains inside information as stipulated
under the Market Abuse Regulation (EU) No. 596/2014 ("MAR").
This information is provided by RNS, the news service of the
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END
IR FFFVVTFIRFII
(END) Dow Jones Newswires
August 27, 2020 02:00 ET (06:00 GMT)
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