CALGARY, May 30, 2017 /CNW/ - Sterling Resources Ltd.
(TSXV:SLG) ("Sterling" or the "Company") announces interim
operating and financial results for the quarter ended March 31, 2017. Unless otherwise noted, all
figures contained in this release are denominated in United States dollars. The Company's
interim condensed consolidated financial statements and
management's discussion and analysis ("MD&A") for the reporting
period have been filed on SEDAR at www.sedar.com and posted on the
Company's website at www.sterling-resources.com.
On May 16, 2017, the sale of all
or substantially all of the assets of the Company resulting from
the sale by the Company's wholly‐owned subsidiary SRUK Holdings
Ltd. ("SHL") of the entire issued share capital of Sterling
Resources (UK) Ltd. (the "Transaction") pursuant to a share
purchase agreement dated March 3,
2017 between the Company, SHL and Oranje‐Nassau Energie B.V.
was completed. Thereafter, the Company has begun to undertake
the steps necessary to wind‐up and dissolve the Company as
economically and quickly as practical, and to deliver the net
distributable proceeds into the hands of the
shareholders.
With the commencement of the winding-up process, the Company no
longer continues as a going concern. As a result, the
Transaction has been treated as an adjusting event in the Company's
interim condensed consolidated financial statements.
FINANCIAL AND OPERATING HIGHLIGHTS
- Net working capital was a surplus of $109.3 million as at March
31, 2017, and has improved following the completion of the
Transaction. The net proceeds of the Transaction of $113.8 million (the netting of the assets held
for sale less the liabilities associated with the assets held for
sale) were received on May 16,
2017.
- For the three month period ended March
31, 2017, the Company recorded a net loss of $5.8 million ($0.04
per weighted average Common Share) for continued operations and a
loss of $164.8 million ($1.12 per weighted average Common Share) for
discontinued operations compared with a net loss of $1.5 million ($0.00
per weighted average Common Share) for continued operations and a
loss of $15.9 million ($0.04 per weighted average Common Share) for
discontinued operations in the three month period ended
March 31, 2016. The net loss in 2017,
compared to 2016, was much higher following the completion of the
Transaction, which is treated as an adjusting event resulting in a
write-down of $166.6 million as the
disposed operations are transferred to assets held for sale.
- For the three month period ended March
31, 2017, revenue was $10.3
million, compared to $12.5
million for the three month period ended March 31, 2016.
- Breagh sales of gas production were approximately 1.6 billion
cubic feet at an average realized gas price of 45.4 pence per therm during the three month
period ended March 31, 2017, compared
to 2.2 billion cubic feet at an average realized gas price of
30.6 pence per therm for the three
month period ended March
31,2016.
NON-GAAP FINANCIAL MEASURES
This news release contains references to certain financial
measures used by the Company that do not have a standardized
meaning prescribed by GAAP and may not be comparable to similar
measures presented by other entities. Readers are cautioned that
these non-GAAP measures should not be construed as alternatives to
other measures of financial performance calculated in accordance
with GAAP. The non-GAAP measures and their manner of reconciliation
to GAAP financial measures are discussed below. These non-GAAP
measures provide additional information that management believes is
meaningful in describing the Company's operational performance,
liquidity and capacity to fund capital expenditures and other
activities. The specific rationale for, and incremental information
associated with, each non-GAAP measure is discussed below.
Net working capital surplus (deficit), as used in this news
release, is defined as current assets less current liabilities
excluding the Cladhan funding arrangements and is used to monitor
the short term financial health of the company.
Neither the 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.
Filer Profile No. 00002072
FORWARD-LOOKING STATEMENTS
All statements included in
this news release that address activities, events or developments
that Sterling expects, believes or anticipates will, should or may
occur in the future are forward-looking statements. In
particular, this news release contains forward-looking statements
with respect to the wind‐up and dissolution of the Company and the
delivery of the net distributable proceeds to shareholders.
These forward-looking statements involve numerous assumptions
made by Sterling based on its experience, perception of historical
trends, current conditions, expected future developments and other
factors it believes are appropriate in the circumstances. In
addition, these statements involve substantial known and unknown
risks and uncertainties that contribute to the possibility that the
predictions, forecasts, projections and other forward-looking
statements will prove inaccurate, certain of which are beyond
Sterling's control, including: the impact of general economic
conditions in the areas in which Sterling operates, civil unrest,
industry conditions, changes in laws and regulations including the
adoption of new environmental laws and regulations and changes in
how they are interpreted and enforced, increased competition, the
lack of availability of qualified personnel or management,
fluctuations in commodity prices, foreign exchange or interest
rates, stock market volatility and obtaining required approvals of
regulatory authorities. In addition, there are risks and
uncertainties associated with oil and gas operations. Readers
should also carefully consider the matters listed under the heading
"Risk Factors" in the Company's MD&A.
Undue reliance should not be placed on these forward-looking
statements, as there can be no assurance that the plans, intentions
or expectations upon which they are based will occur. Sterling's
actual results, performance or achievements could differ materially
from those expressed in, or implied by, these forward-looking
statements. These statements speak only as of the date of the news
release. Sterling does not intend and does not assume any
obligation to update these forward-looking statements except as
required by law.
ABOUT STERLING
Sterling Resources Ltd. is a
Canadian-listed company whose registered office is in Calgary, Alberta. The Common Shares are listed
and posted for trading on the TSXV under the symbol "SLG".
SOURCE Sterling Resources Ltd.
