Magma Energy releases year end results

Alexander Richter 15 Sep 2009

In a release, “Magma Energy Corp. (TSX: MXY) reported its audited financial and operating results for the fourth quarter and fiscal year ended June 30, 2009. The Company also provided an update on its operations.

Commenting on today’s announcement, Ross Beaty, Chairman and CEO, said: “Magma Energy had a great first full year of operations. We put together a world-class exploration and operating team, raised more than $130 million in tough financial markets, acquired one producing asset in Nevada, built up a large land position of geothermal exploration properties in Nevada, Idaho, Oregon, Peru, Chile and Argentina and, just after year-end, entered into agreements to acquire a minority interest in another producing asset in Iceland. Magma ended the year with a successful initial public offering and listing on the Toronto Stock Exchange and is entering its second full year in healthy condition.”

Magma reported a net loss of $1,876,768 or ($0.01) per share. Revenues from energy sales were $1,256,612 and gross profit from the Soda Lake plant operations was $644,221. Net income from plant operations was $288,415, after deducting amortization, accretion and depletion expenses. Net loss for Magma’s geothermal exploration and corporate activities during the fourth quarter was $2,165,183, which included a write-off of $1,086,822 of expenditures incurred on the Carran property in Chile, which was relinquished at year-end.

For the year, Magma reported a net loss of $4,459,556 or ($0.03) per share. Total revenues included energy sales of $3,963,167 from the date of the Company’s acquisition of its Soda Lake operation on October 3, 2008 to June 30, 2009 and $521,963 from the sale of portfolio energy credits. Gross profit from operations for the same period was $1,481,845. Net income from plant operations, after deducting amortization, accretion and depletion expenses, was $430,165.

Expenses incurred by the Company in connection with geothermal exploration and corporate activities during the year were $4,889,721. Significant expenses included general and administrative costs of $1,524,452 and the write-off of $1,086,822 of expenditures incurred on the Carran property in Chile.

On a cash basis for the year ended June 30, 2009, the Company spent $1,318,494 on operating activities and $38,228,140 on investing activities, including investments of $17,556,726 to acquire the Soda Lake operation and $15,396,112 to acquire and explore the Company’s portfolio of exploration projects. At June 30, 2009, Magma had cash and cash equivalents of $4,482,693 and working capital of $2,747,685. Subsequent to the year end, the Company completed an IPO and raised net proceeds of $88 million. The Company had no long-term debt at year-end and an undrawn credit facility of C$20 million.

The release provides further details on the company’s activities, including the acquisition of a large stake in Icelandic HS Orka by Magma Energy Sweden. This acquisition was today confirmed in a council meeting by the city of Reykjavik, Iceland. (source: Icelandic visir.is)

For the full results and release see link below.

Source: Company release via Marketwire