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Camrova Resources Inc. — Interim / Quarterly Report 2018
Apr 30, 2018
43925_rns_2018-04-30_226fd9d1-5817-4f40-9425-220a16c6272f.pdf
Interim / Quarterly Report
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Notice of no Auditor Review of Interim Financial Statements
Under National Instrument 51-102, Part 4, subsection 4.3(3)(a), if an auditor has not performed a review of the interim financial statements, they must be accompanied by a notice indicating that the financial statements have not been reviewed by an auditor.
The accompanying unaudited condensed interim consolidated financial statements of Camrova Resources Inc. (the “Company”) as at March 31, 2018, and for the three months ended March 31, 2018, have been prepared by and are the responsibility of the Company’s management.
The Company’s independent auditor has not performed a review of these financial statements in accordance with standards established by the Canadian Institute of Chartered Accountants for a review of interim financial statements by an entity’s auditor.
Camrova Resources Inc.
Condensed Interim Consolidated Financial Statements - Unaudited March 31, 2018 (Expressed in United States dollars)
Camrova Resources Inc. Consolidated Balance Sheets - Unaudited As at March 31, 2018 and December 31, 2017
(expressed in United States dollars)
| March 31, 2018 |
December 31, 2017 |
|
|---|---|---|
| ASSETS | ||
| Cash and cash equivalents | 333,988 | 457,357 |
| Other current assets(note3) | 11,970 | 15,875 |
| Current assets | 345,958 | 473,232 |
| Total assets | 345,958 | 473,232 |
| LIABILITIES AND EQUITY | ||
| Accounts payable and accruedliabilities (note 6) | 116,785 | 133,350 |
| Current liabilities | 116,785 | 133,350 |
| Share capital | 291,467,000 | 291,467,000 |
| Contributed surplus | 144,305,806 | 144,300,322 |
| Deficit | (442,125,387) | (442,016,344) |
| Accumulated other comprehensive income | 6,581,754 | 6,588,905 |
| Total shareholders’ equity(note 4) | 229,173 | 339,882 |
| Total liabilities and shareholders’ equity | 345,958 | 473,232 |
Nature of operations and going concern (note 1)
Guarantees and commitments (note 8)
Approved by the Board and authorized for issue on April 30, 2018.
| /s/ C. Thomas Ogryzlo Director | /s/ Wolf Seidler | Director |
|---|---|---|
The accompanying notes form an integral part of these unaudited condensed interim consolidated financial statements.
1
Camrova Resources Inc. For the three months ended March 31, 2018 and 2017
(expressed in United States dollars)
Consolidated Statements of Operations - Unaudited
| Three m | onths ended | |
|---|---|---|
| 2018 | March 31 2017 |
|
| Expenses | ||
| General and administration(note5) | 114,378 | 186,862 |
| Loss before other items | (114,378) | (186,862) |
| Foreign exchange loss | 5,596 | (13,191) |
| Finance income | 340 | 256 |
| Finance expense | (600) | (483) |
| Loss before tax | (109,042) | (200,280) |
| Taxes | - | - |
| Loss for theperiod | (109,042) | (200,280) |
| Loss per share | ||
Basic and diluted |
(0.01) | (0.01) |
| Weighted average number of shares outstanding | ||
| Basic and diluted | 17,010,653 | 17,010,653 |
Consolidated Statements of Comprehensive Loss - Unaudited
| Three m 2018 |
onths ended March 31, 2017 |
|
|---|---|---|
| Loss for the period | (114,378) | (280,280) |
| Other comprehensive income | ||
| Items that may be reclassified subsequent to profit or loss Currencytranslation adjustment |
5,336 | 8,234 |
| Total comprehensive loss | (109,042) | (192,046) |
The accompanying notes form an integral part of these unaudited condensed interim consolidated financial statements.
2
Camrova Resources Inc.
Consolidated Statements of Changes in Equity - Unaudited
(expressed in United States dollars)
| Share |
capital |
Contributed |
Accumulated other comprehensive |
|||
|---|---|---|---|---|---|---|
| Number | Amount | surplus | Deficit | income | Total | |
| Balance – January 1, 2017 | 17,010,653 |
291,467,000 |
144,091,000 |
(441,251,147) |
6,547,818 |
854,671 |
| Loss for the period | - | - |
- | (200,280) | - | (200,280) |
| Currency translation adjustment | - | - | - | - | 8,234 |
8,234 |
| Stock-based compensation expense | - | - |
58,000 | - | - |
58,000 |
| Balance – March 31, 2017 | 17,010,653 | 291,467,000 | 144,149,000 | (441,451,427) | 6,556,052 | 720,625 |
| Loss for the period | - | - | - | (564,918) | - |
(564,918) |
| Currency translation adjustment | - | - |
- | - | 32,853 |
32,853 |
| Stock-based compensation expense | - | - | 151,321 | - | - |
151,321 |
| Balance – December 31, 2017 | 17,010,653 | 291,467,000 | 144,300,321 | (442,016,345) | 6,588,905 |
339,881 |
| Loss for the period | - | - | - | (109,042) | - | (109,042) |
| Currency translation adjustment | - | - | - | - | (7,151) |
(7,151) |
| Stock-based compensation expense | - | - | 5,485 | - | - |
5,485 |
| Balance – March 31, 2018 | 17,010,653 | 291,467,000 | 144,305,806 | (442,125,387) | 6,581,753 | 229,173 |
The accompanying notes form an integral part of these unaudited condensed interim consolidated financial statements.
3
Camrova Resources Inc. Consolidated Statements of Cash flows - Unaudited For the three months ended March 31, 2018 and 2017
(expressed in United States dollars)
| Three 2018 |
months ended March 31, 2017 |
|
|---|---|---|
| Cash flows from operating activities | ||
| Loss for the period | (109,042) | (200,280) |
| Items not affecting cash | ||
| Stock-based compensation expense | 5,485 | 58,000 |
| Unrealized foreign exchange | 6,952 | 13,065 |
| (96,605) | (129,215) | |
| Net changes in working capital balances | ||
| Other current assets | 3,545 | 292,127 |
| Accountspayable and accrued liabilities | (13,225) | (9,543) |
| (106,285) | 153,369 | |
| Effect of exchange rate changes on cash and cash equivalents | (17,083) | 2,297 |
| Increase (decrease) in cash and cash equivalents | (123,368) | 155,666 |
| Cash and cash equivalents -beginning of period | 457,357 | 66,433 |
| Cash and cash equivalents - end ofperiod | 333,988 | 222,099 |
Supplemental cash flow information (note 9)
The accompanying notes form an integral part of these unaudited condensed interim consolidated financial statements.
4
Camrova Resources Inc. Notes to the Condensed Interim Consolidated Financial Statements - Unaudited March 31, 2018
(expressed in United States dollars, unless stated otherwise)
1 NATURE OF OPERATIONS AND GOING CONCERN
Camrova Resources Inc. (the “Company” or “Camrova”) was incorporated on July 15, 1985, under the Company Act of British Columbia. The Company is a reporting issuer in Canada and trades on the TSX Venture Exchange, the Frankfurt Stock Exchange and the OTC market. The Company is domiciled in Canada and its registered office is 600-890 West Pender Street, Vancouver, British Columbia, V6C 1J9.
On October 17, 2016, the Company changed its name to Camrova Resources Inc. from Baja Mining Corp., and consolidated the Company’s common shares on a twenty-old-shares-for-one-new basis. These consolidated financial statements reflect the share consolidation and all references to number of common shares, share options, and per common share amounts have been retroactively restated to present post-consolidation amounts.
These consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of operations. The Company’s ability to continue as a going concern is dependent on its ability to generate future profitable operations and/or obtain the necessary financing to meet its obligations and repay its liabilities from normal operations when they become due. In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future, which is at least but not limited to twelve months from the end of the reporting period.
As at March 31, 2018, the Company had cash and cash equivalents of $333,988, working capital of $229,173, and an accumulated deficit of $442,125,387. The Company had cash outflows from operations of $123,368 for the three-month period ended March 31, 2018. The Company expects to incur further losses in the development of its business. Based on the Company’s cash flow forecasts, it will require additional financing within the next 12 months in order to meet its ongoing corporate overhead, and to pursue discretionary exploration and evaluation programs. Management cannot provide assurance that the Company will ultimately achieve profitable operations or become cash flow positive, or will be able to raise additional future funding when required. These factors cast significant doubt on the Company’s ability to continue as a going concern.
These condensed interim consolidated financial statements do not include the adjustments to the amounts and classification of assets and liabilities that would be necessary should the Company be unable to continue as a going concern. These adjustments may be material.
2 BASIS OF PREPARATION AND NEW ACCOUNTING POLICIES
These condensed interim consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”) applicable to the preparation of interim financial statements, including International Accounting Standard (“IAS”) 34 Interim Financial Reporting .
These condensed interim consolidated financial statements follow the same accounting policies and methods of application as the Company’s most recent annual consolidated financial statement, and should be read in conjunction with the Company’s annual consolidated financial statements for the year ended December 31, 2017, which were prepared in accordance with IFRS as issued by the IASB.
5
Camrova Resources Inc.
Notes to the Condensed Interim Consolidated Financial Statements - Unaudited March 31, 2018
(expressed in United States dollars, unless stated otherwise)
3 RECEIVABLES AND OTHER ASSETS
| March 31, 2018 |
December 31, 2017 |
|
|---|---|---|
| Prepaid expenses | 11,970 | 13,974 |
| Other receivables,advances,and deposits | - | 1,901 |
| Current balance | 11,970 | 15,875 |
| Long-term balance | 11,970 | 15,875 |
4 SHAREHOLDERS’ EQUITY
a) Authorized share capital
The Company has been authorized to issue an unlimited number of common shares without par value.
b) Stock options
Details of the Company’s stock option activity are as follows:
| Number of options |
Weighted average exercise price (Cdn$ per option) |
|
|---|---|---|
| Stock options outstanding – January 1, 2018 | 1,700,625 | 0.207 |
| Granted | - | - |
| Stock options outstanding– March 31,2018 | 1,700,625 | 0.207 |
The following table summarizes information about stock options outstanding and exercisable at March 31, 2018:
| Range of prices (Cdn$ per option) |
Number of outstanding options |
Weighted average years to expiry for outstanding options |
Weighted average exercise price for outstanding options (Cdn$) |
Number of exercisable options |
Weighted average exercise price for exercisable options (Cdn$) |
|---|---|---|---|---|---|
| 0.075-0.215 | 1,700,625 | 4.05 | 0.207 | 918,750 | 0.207 |
The Company’s stock option plan (the “Plan”) allows the Company to grant stock options up to a maximum of 10% of the number of issued shares of the Company. Options granted under the Plan will vest with the right to exercise one-quarter of the options upon conclusion of every six months subsequent to the grant date, unless otherwise specified by the board of directors at the time the particular options are granted.
6
Camrova Resources Inc. Notes to the Condensed Interim Consolidated Financial Statements - Unaudited March 31, 2018
(expressed in United States dollars, unless stated otherwise)
4 SHAREHOLDERS’ EQUITY (CONTINUED)
- b) Stock options (continued)
On February 8, 2017, the Company issued 1,363,750 stock options with an exercise price of Cdn$0.215 per share. The fair value of the options was calculated using the Black-Scholes option-pricing model with the following assumptions:
| 2017 | |
|---|---|
| Risk-free interest rate | 1.01% |
| Dividend yield | 0% |
| Expected volatility | 140.05% |
| Expected stock option life | 5 years |
| Weighted average fair value of stock optionsgranted | Cdn$0.19 |
Expected volatility is determined by reference to historically observed prices of commons shares.
Also on February 8, 2017, the Company approved the re-pricing of the 236,875 previously issued stock options at a new exercise price of Cdn$0.215, subject to TSX Venture Exchange approval (and in the case of insiders of the Company, disinterested shareholder approval). Approval from the TSX Venture Exchange was received subject to disinterested shareholder approval for insiders of the Company, which was recorded at the AGM on August 15, 2017.
No stock options granted in the three-month period ended March 31, 2018.
The total stock-based compensation recorded during the three month period ended March 31, 2018 was $5,485 (2017 - $58,000). This has been recognized in general and administration expense and contributed surplus.
5 GENERAL AND ADMINISTRATION EXPENSE
| Three m 2018 |
onths ended March 31, 2017 |
|
|---|---|---|
| Wages, salaries, and management fees | 52,765 | 85,437 |
| Directors fees | 5,933 | 7,807 |
| Stock-based compensation (note 4(b)) | 5,485 | 58,000 |
| Professional and consulting fees | 11,787 | 13,608 |
| Office and administration | 30,157 | 16,296 |
| Shareholders information | 8,251 | 5,714 |
| 114,378 | 186,862 |
7
Camrova Resources Inc. Notes to the Condensed Interim Consolidated Financial Statements - Unaudited March 31, 2018
(expressed in United States dollars, unless stated otherwise)
6 RELATED PARTY TRANSACTIONS
Compensation of key management personnel
Key management personnel are those persons that have the authority and responsibility for planning, directing and controlling the activities of the Company, directly or indirectly. Key management personnel of the Company include executive officers and directors.
The compensation paid or payable to key management, or to companies in common with key management personnel, for services provided is shown below.
| Three m 2018 |
onths ended March 31, 2017 |
|
|---|---|---|
| Short-term employee benefits | - | 68,575 |
| Stock-based compensation | 5,485 | 58,000 |
| 5,485 | 126,575 |
As at March 31, 2018, the accounts payable and accrued liabilities balance includes $113,690 owing to key management personnel (December 31, 2017 - $133,350).
7 SEGMENTED INFORMATION
The Company currently operates in one business segment, being the acquisition, exploration and development of resource properties.
8 GUARANTEES AND COMMITMENTS
In 2012, the Company entered into a lease assignment for offices no longer being used by the Company. In order to induce the landlord to approve the assignment, the Company provided an indemnity agreement to the landlord. The Company will remain liable during the balance of the lease term in the event the assignee does not fulfill its obligations to the landlord. The lease expires September 30, 2020.
At March 31, 2018, total future aggregate minimum lease payments over the remaining lease term by the assignee to the landlord covered by this indemnity agreement is $1,477,583.
No amount has been accrued for this indemnity as of March 31, 2018, as management has assessed that it was not probable that the Company will be required to cover any amounts under the indemnity.
8
Notes to the Condensed Interim Consolidated Financial Statements - Unaudited March 31, 2018
Camrova Resources Inc.
(expressed in United States dollars, unless stated otherwise)
9 SUPPLEMENTAL CASH FLOW INFORMATION
| March 31, 2018 |
March 31, 2017 |
|
|---|---|---|
| Cash in bank | 333,988 | 45,318 |
| Cash equivalents | - | 176,781 |
| 333,988 | 222,099 |
9