GOLDEN, Colo., May 8 /PRNewswire-FirstCall/ -- Canyon Resources Corporation , a Colorado-based mining company, today announced a net loss of $0.4 million, or $0.01 per share, on revenues of $0.6 million in first three months of 2006. This compares to a net loss of $2.3 million, or $0.08 per share, on revenues of $1.0 million in first three months of 2005. The current quarter's loss included non-cash charges totaling $0.2 million related to share-based compensation and the fair value of outstanding warrants recorded as a liability. We ended the quarter with $4.6 million of unrestricted cash and cash equivalents, which decreased $1.1 million from December 31, 2005.
We had a significantly lower loss of $0.4 million in the current quarter compared to $2.3 million in the same quarter last year. The $1.9 million decrease in net loss was due primarily to lower depreciation, depletion and amortization of $0.9 million, other income increased by $0.8 million due to the current quarter sale of securities, expenses decreased by $0.4 million due to the lack of a debenture conversion expense in the current quarter. Those positive variances where partially offset by other items that when combined amounted to an increase in expenses of $0.2 million.
For the three months ended March 31, 2006, cash operating activities used $1.6 million and investing activities provided $0.4 million. The cash provided by investing activities was due to the sale of securities for $0.8 million partially offset by an increase in capitalized development of $0.4 million related to development drilling at Briggs.
At Briggs, revenues for the first quarter declined at an increased rate as compared to the previous quarters because most of the recoverable gold has been leached from the pads. We have thoroughly rinsed the pads and have stopped adding new water to the rinse system in preparation for final reclamation of the leach pads. Gold sales decreased to 1,045 ounces in the current quarter compared to 2,365 ounces in the same quarter last year, resulting in a 41% reduction in the current quarter's revenues. We realized $567 per equivalent gold ounce during the current quarter compared to $424 per equivalent gold ounce in the same quarter last year. The increased gold price partially offset the reduced gold production.
We have completed approximately 20,000 feet of development drilling from 56 holes in and around the existing Briggs pits as part of the initial redevelopment activities at Briggs. This work has resulted in the discovery of a new high grade feeder zone between the existing Goldtooth and Briggs pits. Significant intercepts have been encountered over a 700 foot strike length including one intercept of 10 feet running 1.4 ounces per ton. A new estimate of mineralized material incorporating this data is expected by the end of June. Cost estimates are being prepared for restarting Briggs along with a new plan of operations both of which are expected to be completed by September.
Besides the development drilling around Briggs, other first quarter development activities included the pre-feasibility study of the Reward property in western Nevada and the acquisition and subsequent joint venture of certain uranium properties in Wyoming.
Canyon Resources will be holding a conference call for all interested parties at 11:00 a.m., EDT, Tuesday, May 09, 2006. Live audio of the call will be accessible to the public by calling US/Canada dial-in number: 877-576-0177; international dial-in number: 706-679-4128. Conference ID number: 8929634. Callers should dial in approximately 10 minutes before the call begins. The conference call will also be Web cast and is available for thirty days at http://audioevent.mshow.com/298467/ or via the Company's website at http://www.canyonresources.com/. A conference call replay will be available one hour following the call, through midnight 05/12/2006 and can be accessed by calling: 800-642-1687 or 706-645-9291. Conference ID 8929634.
Actual results may differ materially from any forward-looking statement whether expressed or implied in this news release. The following risks and uncertainties which could cause actual results to vary include, but are not limited to speculative nature of mineral exploration, precious metal prices, production and reserve estimates, production costs, cash flows, environmental and governmental regulations, availability of financing, judicial proceedings and force majeure events and other risk factors as described from time to time in the Company's filings with the Securities and Exchange Commission. Most of these factors are beyond the Company's ability to control or predict.
FOR FURTHER INFORMATION, SEE http://www.canyonresources.com/ or contact:
James Hesketh, President, 303/278-8464;
Valerie Kimball, Investor Relations 303/278-8464
Canyon Resources Corporation & Subsidiaries
Summarized Financial and Production Information
Three months ended March 31,
2006 2005
STATEMENT OF OPERATIONS
Revenue $593,300 $1,002,200
Cost of sales 453,600 1,130,200
Depreciation, depletion & amortization 8,900 909,900
Selling, general & administrative 867,800 608,500
Exploration and development costs 309,100 171,300
Accretion expense 50,800 33,500
Debenture conversion expense -- 448,200
Gain on sale of securities (816,000) --
Loss on derivative instruments 145,900 --
Other (income) expense, net (44,700) 8,500
Net loss ($382,100) ($2,307,900)
Net loss per share ($0.01) ($0.08)
Weighted average shares outstanding 38,320,533 30,268,200
CASH FLOW
Cash & cash equivalents, beginning of
period $5,649,200 $4,638,300
Net cash used in operating activities (1,456,100) (561,800)
Net cash provided by (used in)
investing activities 368,900 (14,800)
Net cash (used in) provided by
financing activities (1,400) 2,172,900
Cash & cash equivalents, end of period $4,560,600 $6,234,600
BALANCE SHEET Mar. 31, 2006 Dec. 31, 2005
Assets
Current assets $4,771,800 $6,183,700
Noncurrent assets 9,371,600 8,463,000
Total assets $14,143,400 $14,646,700
Liabilities & Stockholders' Equity
Current liabilities $1,709,500 $1,988,200
Notes payable - long term 825,000 825,000
Other noncurrent liabilities 5,001,700 4,944,500
Stockholders' equity 6,607,200 6,889,000
Total liabilities & stockholders'
equity $14,143,400 $14,646,700
PRODUCTION & SALES DATA Mar. 31, 2006 Mar. 31, 2005
Gold production (oz) 839 2,634
Gold sales (oz) 1,045 2,365
Per ounce amounts:
- Average realized price $567 $424
- Average market price (London PM Fix) $554 $427
