Welcome!

News Feed Item

RB Energy Reports Q1 2014 Results

VANCOUVER, BRITISH COLUMBIA -- (Marketwired) -- 05/13/14 -- RB Energy Inc. (the "Company" or "RBI" or RB Energy") (TSX: RBI)(OTCQX: RBEIF) is pleased to report financial and operating results for the three months ended March 31, 2014. The consolidated financial statements together with Management's Discussion and Analysis will be available on the Company's web site (www.rb-e.com) and on SEDAR (www.sedar.com).

FIRST QUARTER HIGHLIGHTS

Corporate

The Company's acquisition of Sirocco Mining Inc. ("Sirocco"), first announced on December 4, 2013, closed on January 31, 2014 at which time the Company acquired all of the issued and outstanding common shares of Sirocco in exchange for approximately 294 million common shares of the Company. At the same time, the Company completed a post-acquisition share consolidation on the basis of one new share for three existing shares.

In March 2014, RB Energy negotiated amendments to the $75.0 million debt facility put in place for the construction of the Quebec Lithium operation, to better align the repayment terms with the revised commissioning schedule. As a result, the four 2014 principal repayments have been reduced from $24.3 million to $11.4 million. The deferred payments have been rescheduled to the periods from March 2015 to March 2017.

Subsequent to the end of the quarter, the Company announced a $22 million bought-deal equity financing to increase its current treasury. The financing is expected to close on or about May 21, 2014.

Quebec Lithium

Unusually cold temperatures in northern Quebec during the first three months of 2014 made the operation of the crushing and grinding circuit problematic, with fine ore freezing in the storage silos. Consequently, the Company elected not to operate the concentrator and focused on the commissioning of the hydro-metallurgical circuit of the plant using the spodumene concentrate stockpiled during the 2013 commissioning of the concentrator circuit. The hydro-metallurgical circuit was operated in commissioning mode for over six weeks and produced high quality battery grade lithium carbonate (99.9% lithium carbonate).

Subsequent to quarter end, with the onset of warmer temperatures, RBI re-started the concentrator with the objective of achieving continuous battery grade lithium production and first sales by the end of May.

Aguas Blancas

For the full three months ended March 31, 2014, Aguas Blancas produced 318 tonnes of iodine at a cash cost of US $25 per kg and sold 256 tonnes at an average price of US $38 per kg. Sales and shipments of iodine in the quarter were negatively impacted by both a port strike and an earthquake in Chile. Over the last 12 months the iodine price has softened due to an imbalance of supply over demand. Most recently however, prices have shown signs of firming up and demand is improving.

RESULTS FROM OPERATIONS

Quebec Lithium is in the commissioning stage and has yet to generate sales and revenues. The financial results from Aguas Blancas are included in the consolidated financial statements of RB Energy from January 31, 2014, the closing date of the acquisition of Sirocco by the Company. Further, IFRS requires RBI to value Sirocco's iodine inventory acquired on January 31, 2014 at its fair value on the date of acquisition. As a result, the operating margin in the statement of operations will not reflect normal course of business until such time as the effect of the fair value of the acquired inventory is absorbed under the Company's weighted average cost methodology applied under its accounting principles.

During the three months ended March 31, 2014, the Company incurred a net loss of $7.5 million ($0.04 per share) compared with a net loss of $2.6 million ($0.02 per share) in the same period in 2013. One-time transaction costs associated with the acquisition of Sirocco account for $3.3 million of the net loss. In addition, general and administrative expenses of $1.8 million (2013: $2.3 million) include costs to maintain offices and staff in Vancouver, Toronto and Montreal. A decision to close the Toronto and Montreal offices was made on January 31, 2014with all corporate functions consolidated in Vancouver effective April 30, 2014.

The foreign exchange loss of $1.8 million (2013: $142,000) is due principally to the negative impact of the weaker Canadian dollar against the US dollar on the carrying value of the US dollar denominated convertible debentures and cash advances from a customer. Interest expense of $0.8 million (2013: nil) relates mainly to the debt supporting iodine operations and interest accrued on cash advances from a customer. Interest on the debt for Quebec Lithium is capitalized during commissioning.


---------------------------------------------------------------------
Three Months Ended                                 Mar-14      Mar-13
---------------------------------------------------------------------
---------------------------------------------------------------------
Total revenues ($000's) (Note 1)                    5,044           -
---------------------------------------------------------------------
Net loss ($000's)                                   7,474       2,555
---------------------------------------------------------------------
Loss per share, basic and diluted ($)                0.04        0.02
---------------------------------------------------------------------
Total assets ($000's) (Note 2)                    477,484     344,076
---------------------------------------------------------------------
Total liabilities ($000's) (Note 2)               218,895     163,337
---------------------------------------------------------------------
Iodine produced (t) (Note 1)                          211           -
---------------------------------------------------------------------
Iodine sold (t) (Note 1)                              126           -
---------------------------------------------------------------------
Iodine avg. price ($/kg) (Note 1)                      40           -
---------------------------------------------------------------------
Iodine cash operating cost ($/kg) (Note 1, 3)          27           -
---------------------------------------------------------------------

Note 1: revenues and iodine data are from February 1 to March 31, 2014, the
period post acquisition of Sirocco.
Note 2: comparative data provided as at December 31, 2013.
Note 3: this is a non-GAAP measure. It was calculated by dividing cost of
sales ($4.7 million), adjusted for the change in inventory ($1.4 million)
and the related depreciation ($0.4 million), by quantities of iodine
produced in the period.
Note 4: for complete details, refer to the March 31, 2014 interim
consolidated financial statements and MD&A.

The increase in total assets and liabilities from December 31, 2013 is due to the acquisition of Sirocco and the consolidation of its net assets as well as the ongoing construction and commissioning of the lithium processing plant in Quebec. Capitalized items include borrowing and operating costs for Quebec Lithium during the period.

OUTLOOK

Quebec Lithium

RB Energy's focus is on completing the commissioning of the processing plant and ramp up to name plate production before the end of 2014. The 2014 timetable includes four operating objectives:

1.  commissioning of the hydro-metallurgical circuits - completed in Q1
    2014;
2.  achieve continuous production of battery-grade lithium carbonate on a
    continuous basis by the end of Q2 2104 - on target;
3.  install a primary optical ore sorter (to reduce ore dilution) during Q2,
    with commissioning completed in early Q3, thereby increasing concentrate
    grade in Q3 2014 - installation commenced; and
4.  reach name plate production capacity before the end of 2014 - on
    schedule.

The extent of 2014 revenue will depend on the timing of achieving commercial production and the ramp up of production volumes. Based on the information currently available to the Company, 2014 lithium production is estimated to be in the 9,000 - 11,000 tonne range. As 2014 will be the first year of operations of the plant, substantially involving commissioning, the estimate of production may have a degree of variability. Operating costs for 2014 will be capitalized until commercial production has been achieved, currently estimated in late Q3 or Q4.

As part of the commissioning process, various plant improvements have been identified and are in progress, including the installation of an optical sorter ($5.6 million), completion of mill construction ($3.3 million), rerouting the local access road from the open pit area ($1.5 million), and construction of a natural gas pipeline ($4.2 million). In addition, RB Energy estimates that several individually smaller capital upgrades will also be warranted.

Aguas Blancas

Production at Aguas Blancas was reduced in late 2013 by placing the Agitated Leach Plant ("ALP") on care and maintenance in response to softening prices in the market. As a result, operations in 2014 will be limited to heap leaching. In 2014, production of iodine is estimated at 1,000 tonnes at a cash cost of approximately US $29/kg. Aguas Blancas expects to supplement the sales of its 2014 production by reducing the level of its approximate 800 tonnes of finished product inventory.

Also late in 2013, the completion of the expansion of the ALP was deferred to 2015. The majority of the equipment for the completion of the expansion is on site. Capital costs in 2014 will be limited to settling the balance of payment of equipment orders ($1.2 million) for the expansion, completion of the chemical plant upgrade ($0.9 million) and sustaining capital of $1.4 million.

About RB Energy Inc.

RBI is a Canadian company formed pursuant to the arrangement involving Sirocco Mining Inc. and Canada Lithium Corp. It currently owns Aguas Blancas, an iodine producing mine in northern Chile, and Quebec Lithium near Val d'Or, the geographical heart of the Quebec mining industry. The Aguas Blancas mine is currently in production. The Quebec Lithium has completed construction and is in the commissioning phase. For more information regarding RBI, please refer to its public filings available at www.sedar.com.

The technical contents of this release have been reviewed by Mr. Kevin Ross, Eur. Ing., a Qualified Person pursuant to NI-43-101. Mr. Ross is Chief Operating Officer of the Company and a Member of The Institute of Materials, Minerals and Mining.

Forward-Looking Statements

Certain information contained in this news release, including any information relating to the state of the lithium and iodine industries; statements regarding our ability and the timing to achieve and sustain commercial production and name-plate production levels of iodine; our ability to secure commercial orders from our customers; and our ability to become a material player in the lithium market are "forward-looking statements". These forward-looking statements relate to future events or future performance and reflect the Company's expectations regarding the future growth, results of operations, business prospects and opportunities of RBI. These forward-looking statements also reflect the Company's current internal projections, expectations or beliefs and are based on information currently available to the Company. In some cases forward-looking information can be identified by terminology such as "may", "will", "should", "expect", "intend", "plan", "anticipate", "believe", "estimate", "projects", "potential", "scheduled", "forecast", "budget" or the negative of those terms or other comparable terminology. The estimates and assumptions of RBI underlying the forward-looking statements in this news release may prove to be incorrect. Assumptions upon which such forward looking information include, among other things, successful and timely commissioning, ramp-up and production at the Quebec Lithium Project; the lack of any further significant capital expenditures during the commissioning stage or to bring the hydrometallurgical process plant into production; the continuing support and cooperation of RBI's off-take partners; as well as financial predictions premised on such assumptions. Although the Company believes that the forward-looking information contained in this news release is based on reasonable assumptions, readers cannot be assured that actual results will be consistent with such statements. Accordingly, readers are cautioned against placing undue reliance on forward-looking information. RBI expressly disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, events or otherwise, except in accordance with applicable securities laws.

On behalf of the Board,

Richard P. Clark, President and CEO

Contacts:
RB Energy Inc.
Sophia Shane
(604) 689-7842
(604) 689-4250 (FAX)
[email protected]

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
Join IBM November 1 at 21st Cloud Expo at the Santa Clara Convention Center in Santa Clara, CA, and learn how IBM Watson can bring cognitive services and AI to intelligent, unmanned systems. Cognitive analysis impacts today’s systems with unparalleled ability that were previously available only to manned, back-end operations. Thanks to cloud processing, IBM Watson can bring cognitive services and AI to intelligent, unmanned systems. Imagine a robot vacuum that becomes your personal assistant th...
What is the best strategy for selecting the right offshore company for your business? In his session at 21st Cloud Expo, Alan Winters, U.S. Head of Business Development at MobiDev, will discuss the things to look for - positive and negative - in evaluating your options. He will also discuss how to maximize productivity with your offshore developers. Before you start your search, clearly understand your business needs and how that impacts software choices.
SYS-CON Events announced today that Cedexis will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Cedexis is the leader in data-driven enterprise global traffic management. Whether optimizing traffic through datacenters, clouds, CDNs, or any combination, Cedexis solutions drive quality and cost-effectiveness.
Most of the time there is a lot of work involved to move to the cloud, and most of that isn't really related to AWS or Azure or Google Cloud. Before we talk about public cloud vendors and DevOps tools, there are usually several technical and non-technical challenges that are connected to it and that every company needs to solve to move to the cloud. In his session at 21st Cloud Expo, Stefano Bellasio, CEO and founder of Cloud Academy Inc., will discuss what the tools, disciplines, and cultural...
Is advanced scheduling in Kubernetes achievable? Yes, however, how do you properly accommodate every real-life scenario that a Kubernetes user might encounter? How do you leverage advanced scheduling techniques to shape and describe each scenario in easy-to-use rules and configurations? In his session at @DevOpsSummit at 21st Cloud Expo, Oleg Chunikhin, CTO at Kublr, will answer these questions and demonstrate techniques for implementing advanced scheduling. For example, using spot instances ...
SYS-CON Events announced today that SIGMA Corporation will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. uLaser flow inspection device from the Japanese top share to Global Standard! Then, make the best use of data to flip to next page. For more information, visit http://www.sigma-k.co.jp/en/.
SYS-CON Events announced today that Yuasa System will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Yuasa System is introducing a multi-purpose endurance testing system for flexible displays, OLED devices, flexible substrates, flat cables, and films in smartphones, wearables, automobiles, and healthcare.
SYS-CON Events announced today that Taica will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Taica manufacturers Alpha-GEL brand silicone components and materials, which maintain outstanding performance over a wide temperature range -40C to +200C. For more information, visit http://www.taica.co.jp/english/.
SYS-CON Events announced today that B2Cloud will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. B2Cloud specializes in IoT devices for preventive and predictive maintenance in any kind of equipment retrieving data like Energy consumption, working time, temperature, humidity, pressure, etc.
Today traditional IT approaches leverage well-architected compute/networking domains to control what applications can access what data, and how. DevOps includes rapid application development/deployment leveraging concepts like containerization, third-party sourced applications and databases. Such applications need access to production data for its test and iteration cycles. Data Security? That sounds like a roadblock to DevOps vs. protecting the crown jewels to those in IT.
Many companies start their journey to the cloud in the DevOps environment, where software engineers want self-service access to the custom tools and frameworks they need. Machine learning technology can help IT departments keep up with these demands. In his session at 21st Cloud Expo, Ajay Gulati, Co-Founder, CTO and Board Member at ZeroStack, will discuss the use of machine learning for automating provisioning of DevOps resources, taking the burden off IT teams.
SYS-CON Events announced today that NetApp has been named “Bronze Sponsor” of SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. NetApp is the data authority for hybrid cloud. NetApp provides a full range of hybrid cloud data services that simplify management of applications and data across cloud and on-premises environments to accelerate digital transformation. Together with their partners, NetApp em...
Why Federal cloud? What is in Federal Clouds and integrations? This session will identify the process and the FedRAMP initiative. But is it sufficient? What is the remedy for keeping abreast of cutting-edge technology? In his session at 21st Cloud Expo, Rasananda Behera will examine the proposed solutions: Private or public or hybrid cloud Responsible governing bodies How can we accomplish?
SYS-CON Events announced today that Ryobi Systems will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Ryobi Systems Co., Ltd., as an information service company, specialized in business support for local governments and medical industry. We are challenging to achive the precision farming with AI. For more information, visit http:...
Cloud-based disaster recovery is critical to any production environment and is a high priority for many enterprise organizations today. Nearly 40% of organizations have had to execute their BCDR plan due to a service disruption in the past two years. Zerto on IBM Cloud offer VMware and Microsoft customers simple, automated recovery of on-premise VMware and Microsoft workloads to IBM Cloud data centers.