Dalradian Resources Inc. Dalradian Reports Q3 2017 Results With Cash Of $48.8 Million

 
TIDMDALR 
 
 
   Dalradian reports Q3 2017 results with cash of $48.8 million 
 
   TORONTO, ONTARIO--(Marketwired - Nov. 10, 2017) - Dalradian Resources 
Inc. (TSX:DNA) (AIM:DALR) ("Dalradian" or the "Company") announces 
results for the three and nine months ended September 30, 2017, 
including closing cash and cash equivalents of $48.8 million(1) . 
 
   Patrick F.N. Anderson, Dalradian's President and CEO, commented: "We 
expect to submit our planning application by the end of 2017. With the 
pending $78 million private placement and proceeds from warrant 
exercises, we are well-placed to move our high grade gold project 
through the permitting process while continuing technical work with the 
aim of increasing its value. In the first half of 2018 we expect to 
release both an updated resource and feasibility study." 
 
   Operational highlights as of November 9, 2017 
 
 
   -- Released the positive results from ore sorting testing, including a 54.6% 
      grade increase and 35.8% decrease in waste material. Ongoing cost-benefit 
      studies and site visits are being conducted prior to ore sorting being 
      included in a feasibility study update 
 
   -- Completed a sensitivity study on two major veins in the resource model 
      where a new approach to modelling resulted in a 32% increase in estimated 
      mineable ounces. Results from the study, along with additional drilling, 
      will be used in an upcoming mineral resource update 
 
   -- Released the results from 15 holes for a total of 6,324 metres of the 
      40,000-metre program, which included step-out drilling 400 metres from 
      the mineral resource boundary and infill drilling to support the planned 
      conversion of ounces from the inferred to indicated mineral resource 
      category. Select results included: 
 
          -- Step-out: 1.98 m of 32.54 g/t gold from the 106-16 vein in hole 
             17-CT-427 
 
          -- Step-out: 0.94 m of 30.89 g/t gold from the T17 vein in hole 
             17-CT-428 
 
          -- Step-out: 1.03 m of 40.09 g/t gold from the Crow vein in hole 
             17-CT-435 
 
          -- Infill: 1.21 m of 76.22 g/t gold from the No.1 vein in hole 
             17-CT-415 
 
          -- Infill: 1.51 m of 41.04 g/t gold from the 106-16 vein in hole 
             17-CT-424 
 
   -- During Q3 2017, regional exploration continued across the broader licence 
      areas, with 77 prospecting samples, 138 stream sediment samples, 57 soil 
      samples, and 640 deep overburden samples collected. During the first nine 
      months of 2017, 204 prospecting samples, 259 stream sediment samples, 170 
      soil samples, and 1,687 deep overburden samples were collected. 
 
 
   Corporate and financial highlights of Q3 2017 
 
 
   -- Cash and cash equivalents were $48.8 million at September 30, 2017 
      compared with $35.7 million at December 31, 2016 
 
   -- Net loss of $1.9 million ($0.01 per share) for the three months ended 
      September 30, 2017 compared with a net loss of $1.4 million ($0.01 per 
      share) for the comparable period of 2016. For the nine months ending 
      September 30, 2017, the Company had a net loss of $5.9 million ($0.02 per 
      share) compared to a net loss of $4.8 million ($0.02 per share) in the 
      same period of 2016. 
 
   -- Expenditures on mineral property under development for the three months 
      ended September 30, 2017 were $5.6 million compared with $4.8 million 
      during the comparable period in 2016. During Q3 2017 permitting, drilling 
      and underground development/surface works for infill drilling were the 
      largest spending categories, as work focused on finalizing the planning 
      (permitting) application (the "Planning Application") and infill 
      drilling. In Q3 2016 much of the activity centred on the feasibility 
      study announced in Q4 2016 and an underground exploration program (the 
      "Underground Program") 
 
   -- During the nine months ended September 30, 2017, expenditures on mineral 
      property under development, net of receipt from processing of mineralized 
      material, were $12.4 million compared with $19.6 million during the 
      comparable period in 2016. Lower expenditures in 2017 were a result of 
      less spending due to the completion of the Underground Program in late 
      2016 
 
   -- Warrants exercised up to the end of Q3, 2017 brought in total proceeds of 
      $30.6 million. Subsequent to the end of Q3, 2017, the Company received 
      additional proceeds of $19.2 million from warrant exercises with over 
      99.7% of the 50,312,500 warrants expiring on October 10, 2017 exercised 
 
   -- As of November 9, 2017, Dalradian had 302,036,596 Common Shares issued 
      and outstanding 
 
 
   (1) All amounts are in Canadian dollars unless otherwise noted 
 
   Minco Royalty Transaction 
 
   During Q3, Dalradian concluded the buyback of the 2% net smelter return 
royalty on a portion of the Northern Ireland Properties (as defined in 
the Royalty Agreement) including the Curraghinalt gold deposit (the 
"Royalty") from Minco plc ("Minco"). On August 30, 2017, Dalradian and 
Minco completed the Royalty buy-back under Rule 2.5 of the Irish 
Takeover Panel Act, Takeover Rules 2013 (the "Royalty Transaction"). The 
Royalty Transaction was implemented as a share for share acquisition of 
Minco by Dalradian pursuant to a scheme of arrangement, under Chapter 1 
of Part 9 of the Companies Act 2014 of Ireland, including a demerger of 
Minco's subsidiary Buchans Resources Limited ("Buchans"), which held all 
of Minco's assets other than the Royalty so that on the completion of 
the Royalty Transaction the only asset held by Minco was the Royalty. 
The Royalty Transaction resulted in the issuance of a total of 
15,489,942 Dalradian shares to Minco shareholders and Buchans. 
 
   The Royalty Transaction had a positive effect on the economics of the 
feasibility study ("FS")(2) contained in the Technical Report (as 
defined below) for an underground mine at the Curraghinalt Gold Project 
based on production of an average of 130,000 ounces per year at a gold 
price of US$1,250 per ounce: 
 
 
   -- After-tax net present value (at a 5% discount rate) increased to US$322 
      million (C$429 million) from US$301 million (C$402 million); 
 
   -- After-tax internal rate of return increased to 25.5% from 24.4%; and 
 
   -- All-in sustaining costs ("AISC", as defined by the World Gold Council) 
      were reduced to US$653 per ounce from US$674 per ounce. 
 
 
   Private placement financing 
 
   On October 10, 2017, the Company announced a non-brokered private 
placement financing (the "Financing") with Orion Mine Finance Fund II LP 
("Orion") and Osisko Gold Royalties Ltd ("Osisko") for gross proceeds of 
C$78.25 million (the "Private Placement"). Pursuant to the Financing, 
Orion will acquire 34,013,605 common shares of Dalradian (the "Common 
Shares") and Osisko will acquire 19,217,687 Common Shares, each at a 
price of C$1.47 per Common Share. The Financing is expected to close on 
or before November 30, 2017. 
 
   Outlook 
 
   As Dalradian works towards the submission of its Planning Application to 
permit the building of a mine at the Curraghinalt gold deposit, the 
Company continues its exploration efforts through drilling, engineering 
and geological studies. With the anticipated closing of the $78.25 
million private placement financing and proceeds from warrants exercised, 
the Company is well-positioned to continue exploration and other work 
with the aim to increase the value of the project. 
 
   Dalradian expects to release an updated mineral resource statement in Q1 
2018 based on the drilling completed in 2017. A revised feasibility 
study is also planned for the end of Q2 2018 which will incorporate the 
details of an expected updated mineral resource, revised modelling 
methodology and ore sorting technology. The Company also continues to 
explore its large land package with extensive sampling in streams and 
soils to create a good baseline of data for future work. 
 
   (2) The effect of the Royalty Transaction on project economics was 
recalculated by management based on the original Feasibility Study 
Technical Report 
 
   Supporting Documents 
 
   The Q3 2017 Financial Statements (not including notes) can be found 
below. The full Q3 2017 Management Discussion and Analysis and Financial 
Statements are available on www.dalradian.com and on www.sedar.com. 
 
 
 
 
 
Condensed Consolidated Statement of Financial Position 
 
(Expressed in Canadian dollars) 
(Unaudited) 
                                                  As at                                 As at 
                                         Sept. 30, 2017                         Dec. 31, 2016 
ASSETS 
Current assets: 
 Cash and cash 
  equivalents                              $ 48,763,293                          $ 35,719,242 
 Amounts 
  receivable                                    818,890                               666,166 
 Prepaid 
  expenses and 
  other assets                                  505,927                               506,785 
                                             50,088,110                            36,892,193 
Non-Current 
assets: 
 Restoration 
  deposit                                     1,042,389                             1,032,135 
 Property, 
  plant and 
  equipment                                 158,975,545                           118,988,157 
 Exploration 
  and 
  evaluation 
  assets (note 
  5)                                          4,291,611                             3,943,077 
                                            164,309,545                           123,963,369 
                                          $ 214,397,655                         $ 160,855,562 
 
LIABILITIES AND 
SHAREHOLDERS' 
EQUITY 
Current 
liabilities: 
 Accounts 
  payable and 
  accrued 
  liabilities                               $ 6,086,353                           $ 4,908,196 
 Provision for 

  reclamation                                   351,036                               347,844 
                                              6,437,389                             5,256,040 
 
Non-Current 
liabilities: 
 Provision for 
  reclamation                                   685,356                               679,124 
 
Shareholders' 
equity: 
 Share capital                              259,357,808                           195,974,511 
 Warrants                                     2,879,391                            10,745,550 
 Contributed 
  surplus                                    15,028,350                            12,314,675 
 Accumulated 
  deficit                                  (69,990,639)                          (64,114,338) 
                                            207,274,910                           154,920,398 
 
                                          $ 214,397,655                         $ 160,855,562 
 
 
Condensed Consolidated Statements of Loss and Comprehensive 
 Loss 
 
(Expressed in Canadian dollars) 
(Unaudited) 
                 Three months ended  Three months ended  Nine months ended  Nine months ended 
                     Sept. 30, 2017      Sept. 30, 2016     Sept. 30, 2017     Sept. 30, 2016 
Operating 
expenses: 
 Salaries and 
  related 
  benefits                $ 771,260           $ 579,902        $ 2,369,866        $ 1,679,710 
 Professional 
  fees and 
  consulting                165,745             235,137            660,081            930,559 
 Share-based 
  payments                  427,870              91,441          1,634,499            371,153 
 Investor 
  relations and 
  travel                    187,254             310,807            614,231            717,307 
 Office, 
  regulatory 
  and general               242,328             157,591            671,747            488,199 
 Interest and 
  bank charges                3,085               2,687             11,459              9,161 
 Amortization                 1,152               1,152              3,455              3,454 
 Foreign 
  exchange 
  loss                      182,726              69,468            133,520            734,564 
                        $ 1,981,420         $ 1,448,185        $ 6,098,858        $ 4,934,107 
 
Interest income             103,862              33,179            222,557            121,328 
 
Loss and 
 comprehensive 
 loss for the 
 period               $ (1,877,558)       $ (1,415,006)      $ (5,876,301)      $ (4,812,779) 
 
Loss per share 
 - basic and 
 diluted                   $ (0.01)            $ (0.01)           $ (0.02)           $ (0.02) 
 
 
 
 
 
 
Condensed Consolidated Statement of Shareholders' 
 Equity 
 
(Expressed in Canadian dollars) 
(Unaudited) 
                                                            Nine months      Nine months 
                                                               ended            ended 
                                                           Sept. 30, 2017   Sept. 30, 2016 
Share capital: 
Balance, beginning of period                                $ 195,974,511    $ 162,680,450 
Common shares issued                                           25,558,404          121,500 
Warrants exercised                                             36,961,967       30,729,039 
Share-based payments exercised                                    862,926        1,308,572 
Balance, end of period                                      $ 259,357,808    $ 194,839,561 
 
Warrants: 
Balance, beginning of period                                 $ 10,745,550     $ 15,019,060 
Warrants exercised                                            (6,321,347)      (4,211,829) 
Warrants expired                                              (1,544,812)         (43,783) 
Balance, end of period                                        $ 2,879,391     $ 10,763,448 
 
Contributed surplus: 
Balance, beginning of period                                 $ 12,314,675     $ 12,533,961 
Increase from share-based payments                              1,865,290          445,071 
Warrants expired                                                1,544,812           43,783 
Share-based payments exercised                                  (696,427)        (703,572) 
Balance, end of period                                       $ 15,028,350     $ 12,319,243 
 
Accumulated deficit: 
Balance, beginning of period                               $ (64,114,338)   $ (56,293,888) 
Loss and comprehensive loss for the period                    (5,876,301)      (4,812,779) 
Balance, end of period                                     $ (69,990,639)   $ (61,106,667) 
 
Total shareholders' equity                                  $ 207,274,910    $ 156,815,585 
 
Condensed Consolidated Statement of Cash Flows 
 
(Expressed in Canadian dollars) 
(Unaudited) 
                                                              Nine months      Nine months 
                                                                    ended            ended 
                                                           Sept. 30, 2017   Sept. 30, 2016 
Cash flows from (used in) operating activities: 
 Loss and comprehensive loss for the period                 $ (5,876,301)    $ (4,812,779) 
Items not affecting cash: 
 Unrealized foreign exchange loss (gain) on cash                   70,852        1,052,978 
 Interest income                                                (222,557)        (121,328) 
 Amortization                                                       3,455            3,454 
 Share-based payments                                           1,634,499          371,153 
 Unrealized foreign exchange loss (gain) on restoration 
  deposit                                                        (10,254)          205,700 
Change in non-cash operating working capital: 
 Amounts receivable                                               280,978          650,173 
 Prepaid expenses and other asset                               (113,723)           32,233 
 Accounts payable and accrued liabilities                        (16,914)           18,389 
Cash flows used in operating activities                     $ (4,249,965)    $ (2,600,027) 
Cash flows from financing activities: 
 Exercise of warrants                                          30,227,220       26,517,210 
 Exercise of options                                              166,500          605,000 
Cash flows from financing activities                         $ 30,393,720     $ 27,122,210 
Cash flows from (used) in investing activities: 
 Expenditures on exploration and evaluation assets            $ (192,520)   $ (21,497,178) 
 Additions to property, plant and equipment                  (12,118,984)                - 
 Minco acquisition cost                                         (919,351)      (2,314,384) 
 Interest received                                                202,003          127,967 
Cash flows used in investing activities                    $ (13,028,852)   $ (23,683,595) 
Net change in cash and cash equivalents                        13,114,903          838,588 
Cash and cash equivalents, beginning of period                 35,719,242       43,322,899 
Effect of exchange rate fluctuations on cash held                (70,852)      (1,052,978) 
Cash and cash equivalents, end of period                     $ 48,763,293     $ 43,108,509 
 
 
 
 
 
 
   About Dalradian Resources Inc. 
 
   Dalradian Resources Inc. is a mineral exploration and development 
company that is focused on advancing its high-grade Curraghinalt Gold 
Project located in Northern Ireland, United Kingdom. 
 
   For additional details on the Curraghinalt high-grade lode gold deposit 
("Curraghinalt"), please refer to the Company's technical report titled 
"NI 43-101 Feasibility Study Technical Report on the Curraghinalt Gold 
Project Northern Ireland" (the "Technical Report"), dated January 25, 
2017 and prepared by Garett Macdonald, P.Eng., Michael Makarenko, 
P.Eng., Indi Gopinathan, P.Eng. and Stacy Freudigmann, P.Eng., all of 
JDS Energy & Mining Inc., and Jean-François Couture, P.Geo., Bruce 
Murphy, P.Eng., Cam Scott, P.Eng., all of SRK Consulting (Canada) Inc., 
and William Harding, C.Geol., of SRK Consulting (UK) Ltd., all of whom 
are independent Qualified Persons as defined by NI 43-101. The Technical 
Report is available on the Company's website and on SEDAR at 
www.sedar.com. 
 
   FORWARD LOOKING STATEMENTS 
 
   This press release contains "forward looking information" which may 
include, but is not limited to, statements with respect to the future 
financial or operating performance of the Company and its subsidiaries 
and its mineral project, the future price of metals, test work and 
confirming results from work performed to date, the estimation of 
mineral resources and mineral reserves, the realization of mineral 
resource and mineral reserve estimates, the timing and amount of 
estimated future production, costs of production, capital, operating and 
exploration expenditures, costs and timing of the development of new 
deposits, costs and timing of future exploration, requirements for 
additional capital, government regulation of mining operations, 
environmental risks, reclamation expenses, title disputes or claims, 
limitations of insurance coverage, the timing and possible outcome of 
pending regulatory matters and the realization of the expected 
production, economics and mine life of the Curraghinalt gold deposit. 
Often, but not always, forward looking statements can be identified by 
the use of words and phrases such as "plans", "expects", "is expected", 
"budget", "scheduled", "estimates", "forecasts", "intends", 
"anticipates", or "believes" or variations (including negative 
variations) of such words and phrases, or statements that certain 
actions, events or results "may", "could", "would", "might" or "will" be 
taken, occur or be achieved. 
 
   Forward looking statements are based on the opinions and estimates of 
management as of the date such statements are made and are based on 

various assumptions such as the continued political stability in 
Northern Ireland, that permits required for Dalradian's operations will 
be obtained on a timely basis in order to permit Dalradian to proceed on 
schedule with its planned exploration and mine development, construction 
and production programs, that skilled personnel and contractors will be 
available as Dalradian's operations commence and continue to grow 
towards production and mining operations, that the price of gold will be 
at levels that render Dalradian's mineral project economic, that the 
Company will be able to continue raising the necessary capital to 
finance its operations and realize on mineral resource and mineral 
reserve estimates and current mine plans, that the assumptions contained 
in the Company's Technical Report dated January 25, 2017 are accurate 
and complete, that the results of the ESIA will be positive and that a 
permitting application for mine construction will be approved. 
 
   Forward looking statements involve known and unknown risks, 
uncertainties and other factors which may cause the actual results, 
performance or achievements of Dalradian to be materially different from 
any future results, performance or achievements expressed or implied by 
the forward-looking statements. Such factors include, among others, 
general business, economic, competitive, political and social 
uncertainties; the actual results of current and future exploration 
activities; the actual results of reclamation activities; conclusions of 
economic evaluations; meeting various expected cost estimates; changes 
in project parameters and/or economic assessments as plans continue to 
be refined; future prices of metals; possible variations of mineral 
grade or recovery rates; the risk that actual costs may exceed estimated 
costs; failure of plant, equipment or processes to operate as 
anticipated; accidents, labour disputes and other risks of the mining 
industry; political instability; delays in obtaining governmental 
approvals or financing or in the completion of development or 
construction activities, as well as those factors discussed in the 
section entitled "Risk Factors" in the Company's Annual Information Form 
for the year ended December 31, 2016 dated March 23, 2017 (the "AIF"). 
 
   Although the Company has attempted to identify important factors that 
could cause actual actions, events or results to differ materially from 
those described in forward looking statements, there may be other 
factors that cause actions, events or results to differ from those 
anticipated, estimated or intended. Forward looking statements contained 
herein are made as of the date of this press release and the Company 
disclaims any obligation to update any forward-looking statements, 
whether as a result of new information, future events or results, except 
as may be required by applicable securities laws. There can be no 
assurance that forward looking statements will prove to be accurate, as 
actual results and future events could differ materially from those 
anticipated in such statements. Accordingly, readers should not place 
undue reliance on forward looking statements. 
 
   Contact Information 
 
   Marla Gale 
 
   Vice President Communications 
 
   [phone] 
 
   [e-mail] 
 
   Grant Thornton UK LLP (Nominated Adviser) 
 
   Philip Secrett / Richard Tonthat 
 
   [phone] 
 
   Canaccord Genuity Limited (Broker) 
 
   Henry Fitzgerald-O'Connor / Martin Davison 
 
   [phone] 
 
   This announcement is distributed by Nasdaq Corporate Solutions on behalf 
of Nasdaq Corporate Solutions clients. 
 
   The issuer of this announcement warrants that they are solely 
responsible for the content, accuracy and originality of the information 
contained therein. 
 
   Source: Dalradian Resources Inc. via Globenewswire 
 
 
  http://www.dalradian.com/ 
 

(END) Dow Jones Newswires

November 10, 2017 02:00 ET (07:00 GMT)

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