RNS No 6626w
ASHURST TECHNOLOGY LIMITED
1st July 1997
1997 FIRST QUARTER RESULTS
June 30, 1997 -- Ashurst Technology Ltd. ("the Company"), and Ashurst Technology
Canada Inc., announce today their first quarter results for 1997. The quarter
represented a busy and successful period for the Company, highlighted by the
signing of agreements to cooperate in the development of five advanced gold
deposits in Ukraine and the successful commercial launch of aluminum-scandium
baseball and softball bats from our licensee Easton Sports. Other important
achievements included the issuance of a significant US patent for
aluminum-scandium alloys and products, and the signing of development and
license option agreements with McDonnell Douglas Aerospace and United
Technologies.
During the three months ended April 30, 1997, a loss of $2,041,372 was incurred,
equal to a loss of US $0.02 per common share unit versus a loss of $2,040,971,
equal to a loss of $0.02 per share for the first quarter one year ago. Revenue
of $1,235,576 was earned during the first quarter of 1997 compared to revenue of
$817,023 earned during the first quarter of 1996. Revenues included sales of
$759,220 of iron concentrate from the Company's mining interest in Ukraine,
interest income of $146,600 and other income of $329,756. Expenses included
production costs of $856,120 from iron concentrate operations, research and
development costs of $1,104,004, administrative development and general expenses
of $778,520 and non-cash expenses of $538,304. As at April 30, 1997, the
Company's cash balance was $9,224,911 compared to $19,841,062 for the same
period in 1996.
On March 25, 1997 the Ukrainian State Owned Closed Joint Stock Company
"Ukrzoloto" and Ashurst Resources International Ltd. announced the completion of
agreements defining their mutual cooperation in developing five advanced gold
projects and three additional exploration prospects located on the Ukrainian
Shield.
The five projects are known as Serhiivske, Balka Zolota, and Balka Shiroka,
located in the Dnipropetrovsk Oblast (region) in addition to Klintsivske and
Yuriivske in the Kirovohrad Oblast. The deposits are narrow vein and similar to
those found in Timmins and Kirkland Lake, Ontario on the Canadian Abitibi
Shield. Independent Canadian mining consultants have been retained to evaluate
existing data. These consulting groups, which include Kilborn Inc. and MineTech
International Limited have been retained to evaluate existing data and work
conducted by the Ukranian Government. Such work includes:
* over 1,000 drill holes averaging 300 meters in depth;
* over 30,000 fire assays, with core splits available for additional assay;
* preliminary metallurgical tests indicating that 70% of the gold can be
extracted by gravity methods;
* at Balka Shiroka, a 6 meter diameter production shaft currently at
120 meters depth; and
* readiness at Klintsivske for bulk sampling with a 41 meter shaft and
several hundred meters of horizontal development.
The results of the data reviewed indicate the projects have an inferred resource
of 500-600 tonnes (16-19 million ounces) of gold, with an average grade of 6 to
8 g/t gold. Excellent infrastructure exists at, or in close proximity to, each
of the project sites including high voltage electrical power, paved roads and
water supplies.
The three exploration areas are known as the Surska Structure, the Chertomlyska
Structure and the Kirovohrad Ore Field. Over 300 drill holes between 200-300
meters in depth have been completed which indicate a potential gold resource of
over 1,000 tonnes (32 million ounces) and excellent potential for base metal
deposits.
The Company has retained the services of Kilborn Inc. as engineering consultant
for the project. Following visits to the sites, Kilborn is completing a due
diligence report and a ranking of the deposits according to timing and cost in
order to plan the steps to complete feasibility studies on each of the five
projects. Mr. H. Andrew Daniels, a Senior Geologist from Kilborn, has been
assigned to Ashurst Resources International to act as Head of Exploration for
the project. Preparation for bulk sampling and up to 100 tonne/day pilot plant
operations have begun at the Klintsivske deposit.
During the quarter, Ashurst continued to attract interest in our
aluminum-scandium alloys. This interest was accelerated by the North American
market launch of aluminum-scandium baseball and softball bats from Easton Sports
on February 17. The launch was extremely well received, with all product
available sold out during the first two days of its introduction. Easton has
claimed that the international advertising and promotional campaign for Redline
represents the most significant product launch in its 75-year history. Ashurst
is currently working with Easton and two additional sports equipment companies
to introduce additional aluminum-scandium products to market.
On April 15th, Ashurst was awarded US patent number 5,620,652, protecting
specific aluminum-scandium alloy compositions and their application in a wide
variety of recreational and sports equipment, and in certain aerospace, ground
transportation and marine structures and components.
In February, McDonnell Douglas Aerospace awarded Ashurst Government Services,
Inc, a preliminary $75,000 contract to investigate the development of a new
class of high strength, weldable aluminum alloys, based on Ashurst's
aluminum-scandium alloy technology. Potential applications include structural
components for a number of launch vehicles, military transport aircraft,
commercial aircraft and fighter aircraft. In March, Ashurst Government Services
was also awarded a $142,000 development contract from United Technologies
Research Center. The two-year program, funded by the Defense Advanced Research
Program Agency is for the development of ultra-lightweight, high temperature
porous titanium thereby lowering the density while maintaining many of the
important properties of the material. Porous titanium will be evaluated for a
number of aerospace applications which include high temperature sound and
vibration damping systems and ultra-lightweight structures.
Ashurst develops mineral resources and advanced materials in Ukraine and North
America. Ashurst's business extends from mining, extractive metallurgy and alloy
processing to the development, production, sale and license of advanced
materials technologies and products. These materials provide performance
advantages in sports equipment aerospace, automotive, transportation and
micro-electronic applications.
Inquiries:
Stephen Meldrum
Vice President, Marketing and Investor Relations
Tel: (410) 455-5517
Fax: (410) 242-4890
ASHURST TECHNOLOGY LTD. AND ASHURST TECHNOLOGY CANADA INC.
Combined Statements of Operations
for the quarters ended April 30, 1997 and 1996
(presented in United States dollars)
1997 1996
Revenue - iron concentrate $ 759,220 $ 537,880
Revenue - other 329,756 13,260
Interest income 146,600 265,883
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1,235,576 817,023
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Expenses
Production costs - iron concentrate 856,120 643,620
Research and development 1,104,004 1,063,489
Administrative, development and general 778,520 750,100
Deemed interest on convertible debentures 131,537 -
Foreign exchange gain (2,594) (7,782)
Depreciation 302,448 305,734
Depletion of mine development costs 30,600 27,200
Amortization 76,313 75,633
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3,276,948 2,857,994
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Loss for the period $ 2,041,372 $ 2,040,971
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Loss per combined share $ 0.02 $ 0.02
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ASHURST TECHNOLOGY LTD. AND ASHURST TECHNOLOGY CANADA INC.
Combined Statements of Changes in Financial Position
for the quarter ended April 30, 1997 and 1996
(presented in United States dollars)
1997 1996
Operating activities
Loss for the period $(2,041,372) $(2,040,971)
Add amounts charged to income not affecting cash
Deemed interest on convertible debentures 131,537 -
Depreciation 302,448 305,734
Depletion of mine development costs 30,600 27,200
Amortization 76,313 75,633
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(1,500,474) (1,632,404)
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Changes in:
Accounts receivable (43,042) (258,460)
Inventory 6,625 (12,920)
Prepaid expenses 38,919 (16,181)
Accounts payable and accrued liabilities (563,711) 247,004
Accrued lease obligation (34,053) (18,615)
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(2,095,736) (1,691,576)
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Investing activities
Joint venture contributions (17,792) (20,496)
Investment in affiliates (1,859,000) -
Capital assets, net (67,315) (118,977)
Other assets - 40,688
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(1,944,107) (98,785)
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Decrease in cash (4,039,843) (1,790,361)
Cash, beginning of period 13,264,754 21,631,423
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Cash, end of period $ 9,224,911 $19,841,062
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END