Ivanhoe Mines Ltd. (TSX:IVN) announced its financial results for the second quarter of 2014, commenting that it was hit by a total comprehensive loss of $135.8 million, up $84.7 million from the year-ago period. That rise “mainly was due to an increase in shared-based payments of $83.3 million and an increase in the mark-to-market loss on revaluation of warrants of $5.2 million.”
Today’s press release also includes an overview of what’s going on at the company’s three main projects: Kamoa, Platreef and Kipushi.
As quoted in the press release:
The company’s total assets increased to $345.7 million as at June 30, 2014, from $287.6 million as at December 31, 2013. This mainly was due to a $42.0 million increase in cash and cash equivalents.
The company generated cash inflow from financing activities during the six months ending June 30, 2014, of $148 million. This was a result of the public offering and a concurrent private placement that Ivanhoe completed in June for a total issuance of 112,500,767 units. Each unit consisted of one Class A common share and one Class A common share-purchase warrant, which were sold at a price of C$1.50 per unit and raised total gross proceeds of C$169 million (net proceeds of $147 million). Subsequent to June 30, 2014, a further 2,500,000 units were sold in connection with the concurrent private placement following the exercise by Robert Friedland of an additional option granted to him.
The company utilized $91.5 million of its cash resources in its operations and earned interest income of $0.4 million on cash balances in the year to date. A total of $14.9 million was spent to acquire property, plant and equipment and other non-current assets.
Of the $14.9 million spent to acquire non-current assets, $3.0 million related to initial costs to secure electricity for the Platreef Project, while $5.4 million related to the cost incurred on the Platreef Project’s Shaft #1 during the year to date. The remainder of the additions to property, plant and equipment mainly related to the procurement of assets required at the other projects.
The company’s total liabilities increased from $60.3 million as at December 31, 2013, to $82.4 million as at June 30, 2014. This mainly was due to the financial liability that arose with the issuance of the purchase warrants in Q2 2014 that had a fair value of $21.1 million at June 30, 2014.