Canadian pure molybdenum producer Thompson Creek Metals Co., Inc. (TC,TCM.TO) announced Monday that it will report financial results for fiscal 2010 using US GAAP instead of the previously used Canadian GAAP.
The company expects to report a loss for fiscal 2009, hurt by the non-cash charge related to the adoption of US GAAP. However, excluding the non-cash charge, it expects to report adjusted net income.
The company was required to comply with the U.S. Securities and Exchange Commission public reporting filing requirements as of January 1, 2010 as more than 50% of its outstanding shares were held by U.S. residents as per the company's determination on June 30, 2009.
The primary differences between Canadian GAAP and US GAAP are the current period expensing of stripping costs, liability treatment and mark-to-market accounting for the warrants, and the financial statement presentation of stock compensation in the company's consolidated statements of income.
The Toronto, Ontario-based company, formerly known as Blue Pearl Mining Ltd. until May 2007, will now prepare the full-year 2009 consolidated financial statements, including the recast of previously reported annual and quarterly financial statements, in accordance with US GAAP.
The company noted that its results will include several impacts due to the adoption of US GAAP, mainly related to the US GAAP accounting treatment of it's 24.50 million outstanding warrants that are exercisable at C$9.00 per common share until October 23, 2011.
Under Canadian GAAP, these outstanding warrants have been classified in equity, while US GAAP the company will be required to reclassify these warrants as a derivative liability and adjust them to fair value each period through a non-cash increase or decrease to consolidated net income. The company noted that there is no possibility for a cash outlay by it for the reclassification, other than minor administrative expenses related to the exercise of warrants.
The company added that the reclassification and adjustment to fair value of these warrants will result in a pre-tax non-cash charge of about US$93 million in its fiscal 2009 consolidated statement of operations, and will be reported under "other expense". This is based on the market value of the outstanding warrants of about US$22 million or C$27 million or C$1.10 for each warrant outstanding on January 1, 2009, as well as about US$115 million or C$121 million or C$4.93 for each warrant outstanding on December 31, 2009.
The company noted that its quarterly and annual earnings for 2010 and 2011 will also be impacted by non-cash gains or charges related to the change in the market value of the warrants until the warrants are either exercised or expire in October 2011.
The company said that it expects to report a net loss for fiscal 2009 as a results of the non-cash charge. However, excluding this non-cash charge, the Company expects to report adjusted net income for the full year. The company is scheduled to report financial results for fiscal 2009 on February 25, 2009.
Last month, Thompson Creek said it expects capital expenditures for fiscal 2010 to be US$298 million, comprising of US$89 million in sustaining capital expenditures and US$209 million for its 75% share of capital expenditures required for the Endako Mine expansion project. The company expects its sustaining capital expenditures in fiscal 2009 to total about US$32 million.
The company said that Endako Mine expansion project includes the construction of a new, modern Endako mill, which will replace the existing 45-year-old mill and raise ore-processing capacity from the existing 31,000 tons per day to 55,000 tons per day. The new mill facility will eliminate the need for significant capital expenditures to upgrade and refurbish the existing Endako mill.
Earlier in November, Thompson Creek announced a profit for the third quarter that plunged to US$19.7 million or US$0.14 per share from US$100.6 million or US$0.74 per share in the prior-year quarter. Quarterly revenues dropped to US$114.4 million from US$331.1 million in the year-ago quarter.
The company noted then that it expects molybdenum production volumes for fiscal 2010 in a range of 29 to 32 million pounds, with the Thompson Creek Mine producing 22 to 24 million pounds and the 75% share of the Endako Mine production at 7 to 8 million pounds. The Company expects to sell 27 to 30 million pounds from its own mines in 2010.
TC closed Friday's regular trading session at $12.93, up $0.15 on a volume of 3.0 million shares, higher than the three-month average volume of 1.81 million shares. In the past 52-week period, the stock has been trading in a range of $2.69 to $15.64.
TCM.TO closed on the Toronto Stock Exchange at C$13.74, up C$0.23 on a volume of 1.70 million shares, higher than the three-month average volume of 1.18 million shares. In the past 52-week period, the stock has been trading in a range of C$3.48 to C$16.50.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.