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As of September 30, 2011 | As of December 31, 2010 | |||||||||||||||||
Estimated | Carrying | Estimated | Carrying | |||||||||||||||
Assets | Category | Fair Value | Value | Fair Value | Value | |||||||||||||
Cash and cash equivalents (1) | Loans and receivables | $ | 114,294 | $ | 114,294 | $ | 178,018 | $ | 178,018 | |||||||||
Restricted cash (1) | Loans and receivables | 2,405 | 2,405 | 1,205 | 1,205 | |||||||||||||
Accounts receivable (1) | Loans and receivables | 16,384 | 16,384 | 11,885 | 11,885 | |||||||||||||
Derivative instrument - Riverstone Warrants (1) | Held-for-trading | 308 | 308 | 375 | 375 | |||||||||||||
Available for sale investments (3) | Available-for-sale | 1,117 | 1,117 | 928 | 928 | |||||||||||||
Total financial assets | $ | 134,508 | $ | 134,508 | $ | 192,411 | $ | 192,411 |
As of September 30, 2011 | As of December 31, 2010 | |||||||||||||||||
Estimated | Carrying | Estimated | Carrying | |||||||||||||||
Liabilities | Category | Fair Value | Value | Fair Value | Value | |||||||||||||
Accounts payable and accrued liabilities (1) | Other financial liabilities | $ | 74,996 | $ | 74,996 | $ | 88,457 | $ | 88,457 | |||||||||
Derivative instrument-Structured Gold Options | Held-for-trading | 6,813 | 6,813 | — | — | |||||||||||||
Convertible debentures (2) | Other financial liabilities | 126,818 | 125,146 | 147,779 | 147,353 | |||||||||||||
Revolving credit facility (2) | Other financial liabilities | — | — | — | — | |||||||||||||
Equipment financing loans (2) | Other financial liabilities | 15,041 | 14,557 | 16,113 | 15,714 | |||||||||||||
Total financial liabilities | Total Financial Liabilities | $ | 223,668 | $ | 221,512 | $ | 252,349 | $ | 251,524 |
(1) | Carrying amount is a reasonable approximation of fair value. |
(2) | The fair values of the debt portion of the convertible senior unsecured debentures, the equipment financing loans, and the revolving credit facility are determined by discounting the stream of future payments of interest and principal at the estimated prevailing market rates of comparable debt instruments. The carrying values of these liabilities are shown net of any capitalized loan fees. The fair value of the equity component of the convertible debentures is estimated by a Black Scholes option pricing model. |
(3) | The fair value represents quoted market prices in an active market. |
Financial assets measured at fair value as at September 30, 2011 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Available for sale investments | $ | 1,117 | $ | — | $ | — | $ | 1,117 | |||||||
Warrants | — | 308 | — | 308 | |||||||||||
$ | 1,117 | $ | 308 | $ | — | $ | 1,425 |
Financial liabilities measured at fair value as at September 30, 2011 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Convertible debentures | $ | — | $ | — | $ | 126,818 | $ | 126,818 | |||||||
Gold price derivatives | — | 6,813 | — | 6,813 | |||||||||||
$ | — | $ | 6,813 | $ | 126,818 | $ | 133,631 |
Financial assets measured at fair value as at December 31, 2010 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Available for sale investments | $ | 928 | $ | — | $ | — | $ | 928 | |||||||
Warrants | — | 375 | — | 375 | |||||||||||
$ | 928 | $ | 375 | $ | — | $ | 1,303 |
Financial liabilities measured at fair value as at December 31, 2010 | |||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||
Convertible debentures | $ | — | $ | — | $ | 147,779 | $ | 147,779 | |||||||
$ | — | $ | — | $ | 147,779 | $ | 147,779 |
Convertible debentures | |||
Balance at December 31, 2010 | $ | 147,779 | |
Gain included in net income | (20,961 | ) | |
Balance at September 30, 2011 | $ | 126,818 |
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For the three months ended September 30 | For the nine months ended September 30 | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
Riverstone Resources, Inc. - warrants | $ | 25 | $ | (311 | ) | $ | 67 | $ | (630 | ) | |||||
Gold price derivatives | 11,136 | — | 17,773 | 1,066 | |||||||||||
Convertible debenture | 2,084 | (18,969 | ) | (22,208 | ) | 4,037 | |||||||||
Derivative (gain)/loss | $ | 13,245 | $ | (19,280 | ) | $ | (4,368 | ) | $ | 4,473 |
For the three months ended September 30 | For the nine months ended September 30 | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
Realized (gain)/loss | $ | 9,461 | $ | — | $ | 10,960 | $ | 1,066 | |||||||
Unrealized (gain)/loss | 3,784 | (19,280 | ) | (15,328 | ) | 3,407 | |||||||||
Derivative (gain)/loss | $ | 13,245 | $ | (19,280 | ) | $ | (4,368 | ) | $ | 4,473 |
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As of | As of | ||||||
September 30 | December 31 | ||||||
2011 | 2010 | ||||||
Stockpiled ore | $ | 9,007 | $ | 2,551 | |||
In-process | 6,709 | 13,839 | |||||
Materials and supplies | 48,909 | 48,814 | |||||
Finished goods | — | — | |||||
Total | $ | 64,625 | $ | 65,204 |
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As of September 30, 2011 | As of December 31, 2010 | ||||||||||||
Riverstone | Riverstone | ||||||||||||
Fair Value | Shares | Fair Value | Shares | ||||||||||
Balance at beginning of period | $ | 928 | 1,300,000 | $ | 181 | 700,000 | |||||||
Acquisitions | 469 | 700,000 | 128 | 600,000 | |||||||||
OCI - unrealized gain/(loss) | (280 | ) | — | 619 | — | ||||||||
Balance at end of period | $ | 1,117 | 2,000,000 | $ | 928 | 1,300,000 |
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As of September 30, 2011 | As of December 31, 2010 | ||||||||||||||||||||||
Property, Plant and Equipment at Cost | Accumulated Depreciation | Property, Plant and Equipment Net Book Value | Property, Plant and Equipment at Cost | Accumulated Depreciation | Property, Plant and Equipment Net Book Value | ||||||||||||||||||
Bogoso/Prestea | $ | 166,216 | $ | (108,654 | ) | $ | 57,562 | $ | 157,010 | $ | (107,132 | ) | $ | 49,878 | |||||||||
Bogoso sulfide plant | 186,671 | (56,673 | ) | 129,998 | 184,641 | (50,988 | ) | 133,653 | |||||||||||||||
Wassa/HBB | 105,313 | (52,457 | ) | 52,856 | 89,875 | (45,607 | ) | 44,268 | |||||||||||||||
Corporate & other | 1,727 | (851 | ) | 876 | 1,343 | (775 | ) | 568 | |||||||||||||||
Total | $ | 459,927 | $ | (218,635 | ) | $ | 241,292 | $ | 432,869 | $ | (204,502 | ) | $ | 228,367 |
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As of September 30, 2011 | As of December 31, 2010 | ||||||||||||||||||||||
Mining Properties | Accumulated Amortization | Mining Properties, Net Book | Mining Properties | Accumulated Amortization | Mining Properties, Net Book | ||||||||||||||||||
Bogoso/Prestea | $ | 110,800 | $ | (59,228 | ) | $ | 51,572 | $ | 99,435 | $ | (56,488 | ) | $ | 42,947 | |||||||||
Bogoso sulfide | 60,217 | (41,585 | ) | 18,632 | 56,541 | (37,101 | ) | 19,440 | |||||||||||||||
Mampon | 15,995 | — | 15,995 | 15,995 | — | 15,995 | |||||||||||||||||
Wassa/HBB | 321,818 | (171,854 | ) | 149,964 | 303,379 | (147,558 | ) | 155,821 | |||||||||||||||
Other | 20,339 | (2,330 | ) | 18,009 | 18,747 | (2,330 | ) | 16,417 | |||||||||||||||
Total | $ | 529,169 | $ | (274,997 | ) | $ | 254,172 | $ | 494,097 | $ | (243,477 | ) | $ | 250,620 |
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For the nine months ended September 30 | |||||||
2011 | 2010 | ||||||
Beginning balance | $ | 44,952 | $ | 31,969 | |||
Accretion expense | 5,300 | 1,802 | |||||
Additions and change in estimates | 3,748 | 16,352 | |||||
Cost of reclamation work performed | (20,244 | ) | (5,534 | ) | |||
Balance at September 30 | $ | 33,756 | $ | 44,589 | |||
Current portion | $ | 11,445 | $ | 17,140 | |||
Long term portion | $ | 22,311 | $ | 27,449 |
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As of | As of | ||||||
September 30 2011 | December 31 2010 | ||||||
Current debt: | |||||||
Equipment financing credit facility | $ | 6,444 | $ | 7,189 | |||
Capital lease | 883 | 2,825 | |||||
Revolving credit facility | — | — | |||||
Total current debt | $ | 7,327 | $ | 10,014 | |||
Long term debt: | |||||||
Equipment financing credit facility | $ | 8,113 | $ | 8,525 | |||
Convertible debentures | 125,146 | 147,353 | |||||
Total long term debt | $ | 133,259 | $ | 155,878 |
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For the three months ended September 30 | For the nine months ended September 30 | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
Current expense | |||||||||||||||
Canada | $ | — | $ | — | $ | — | $ | — | |||||||
Foreign | (788 | ) | (170 | ) | (2,472 | ) | (1,158 | ) | |||||||
Future expense | |||||||||||||||
Canada | — | — | — | — | |||||||||||
Foreign | (2,833 | ) | 213 | (9,255 | ) | (1,579 | ) | ||||||||
Total expense | $ | (3,621 | ) | $ | 43 | $ | (11,727 | ) | $ | (2,737 | ) |
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For the three months ended September 30 | For the nine months ended September 30 | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
Mining operations costs | $ | 87,387 | $ | 77,329 | $ | 258,487 | $ | 216,655 | |||||||
Operations costs from/(to) metal inventory | 1,310 | (2,548 | ) | 851 | (2,314 | ) | |||||||||
Mining related depreciation and amortization | 15,504 | 22,570 | 52,023 | 75,301 | |||||||||||
Accretion of asset retirement obligations | 2,184 | 601 | 5,300 | 1,802 | |||||||||||
Total cost of sales | $ | 106,385 | $ | 97,952 | $ | 316,661 | $ | 291,444 |
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For the three months ended September 30 | For the nine months ended September 30 | ||||||||||||||
2011 | 2010 | 2011 | 2010 | ||||||||||||
Total stock compensation expense | $ | 564 | $ | 449 | $ | 2,784 | $ | 2,368 |
For the nine months ended September 30 | |||
2011 | 2010 | ||
Expected volatility | 66.33 to 69.79% | 67.95 to 77.37% | |
Risk-free interest rate | 1.58 to 2.26% | 2.34 to 2.58% | |
Expected lives | 5.63 to 8.47 years | 6.0 to 8.6 years | |
Dividend yield | 0% | 0% |
Options (‘000) | Weighted– Average Exercise price (Cdn$) | Weighted– Average Remaining Contractual Term (Years) | Aggregate intrinsic value Cdn($000) | ||||||||
Outstanding as of December 31, 2010 | 6,724 | 3.35 | 7.0 | 9,001 | |||||||
Granted | 1,988 | 2.80 | 10.0 | — | |||||||
Exercised | (113 | ) | 1.84 | 4.0 | — | ||||||
Forfeited, canceled and expired | (127 | ) | 3.65 | 6.0 | — | ||||||
Outstanding as of September 30, 2011 | 8,472 | 3.24 | 7.0 | 474 | |||||||
Exercisable as of September 30, 2011 | 6,047 | 3.32 | 6.0 | 393 |
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Africa | ||||||||||||||||||||||||
As of and for the three months ended September 30 | Bogoso/ Prestea | Wassa/ HBB | Other | South America | Corporate | Total | ||||||||||||||||||
2011 | ||||||||||||||||||||||||
Revenues | $ | 68,693 | $ | 57,187 | $ | — | $ | — | $ | — | $ | 125,880 | ||||||||||||
Net income/(loss) attributable to Golden Star | 2,881 | 8,174 | (1,039 | ) | (92 | ) | (20,120 | ) | (10,196 | ) | ||||||||||||||
Income tax expense | — | (3,621 | ) | — | — | — | (3,621 | ) | ||||||||||||||||
Capital expenditure | 9,027 | 11,638 | 146 | — | — | 20,811 | ||||||||||||||||||
Total assets | 371,787 | 253,685 | 2,532 | 228 | 83,560 | 711,792 | ||||||||||||||||||
2010 | ||||||||||||||||||||||||
Revenues | $ | 54,003 | $ | 49,648 | $ | — | $ | — | $ | — | $ | 103,651 | ||||||||||||
Net income/(loss) attributable to Golden Star | 833 | 1,793 | (1,169 | ) | (75 | ) | 14,562 | 15,944 | ||||||||||||||||
Income tax benefit | — | 43 | — | — | — | 43 | ||||||||||||||||||
Capital expenditure | 13,115 | 12,076 | 29 | — | — | 25,220 | ||||||||||||||||||
Total assets | 357,487 | 231,953 | 3,095 | (251 | ) | 167,443 | 759,727 |
Africa | ||||||||||||||||||||||||
As of and for the nine months ended September 30 | Bogoso/ Prestea | Wassa/ HBB | Other | South America | Corporate | Total | ||||||||||||||||||
2011 | ||||||||||||||||||||||||
Revenues | $ | 162,790 | $ | 189,403 | $ | — | $ | — | $ | — | $ | 352,193 | ||||||||||||
Net income/(loss) attributable to Golden Star | (12,889 | ) | 27,189 | (2,419 | ) | (356 | ) | (20,841 | ) | (9,316 | ) | |||||||||||||
Income tax expense | — | (11,727 | ) | — | — | — | (11,727 | ) | ||||||||||||||||
Capital expenditure | 29,877 | 28,407 | 421 | — | — | 58,705 | ||||||||||||||||||
Total assets | 371,787 | 253,685 | 2,532 | 228 | 83,560 | 711,792 | ||||||||||||||||||
2010 | ||||||||||||||||||||||||
Revenues | $ | 168,212 | $ | 159,010 | $ | — | $ | — | $ | — | $ | 327,222 | ||||||||||||
Net income/(loss) attributable to Golden Star | 16,596 | 8,045 | (2,446 | ) | 59 | (21,179 | ) | 1,075 | ||||||||||||||||
Income tax expense | — | (2,737 | ) | — | — | — | (2,737 | ) | ||||||||||||||||
Capital expenditure | 29,806 | 20,176 | 1,613 | — | 95 | 51,690 | ||||||||||||||||||
Total assets | 357,487 | 231,953 | 3,095 | (251 | ) | 167,443 | 759,727 |
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US GAAP | IFRS | IFRS | ||||||||||||||||
As of September 30 2011 | Note | Adjustments | As of September 30 2011 | As of December 31 2010 | ||||||||||||||
ASSETS | ||||||||||||||||||
CURRENT ASSETS | ||||||||||||||||||
Cash and cash equivalents | $ | 114,294 | $ | 114,294 | $ | 178,018 | ||||||||||||
Accounts receivable | 16,384 | 16,384 | 11,885 | |||||||||||||||
Inventories | 64,625 | 1 | $ | (21 | ) | 64,604 | 65,204 | |||||||||||
Deposits | 8,368 | 8,368 | 5,865 | |||||||||||||||
Prepaids and other | 2,097 | 2,097 | 1,523 | |||||||||||||||
Total Current Assets | 205,768 | 205,747 | 262,495 | |||||||||||||||
RESTRICTED CASH | 2,405 | 2,405 | 1,205 | |||||||||||||||
PROPERTY, PLANT AND EQUIPMENT | 241,292 | 241,292 | 227,367 | |||||||||||||||
INTANGIBLE ASSETS | 5,793 | 5,793 | 7,373 | |||||||||||||||
MINING PROPERTIES | 254,172 | 2, 3 | 35,838 | 290,010 | 293,102 | |||||||||||||
DEFERRED EXPLORATION | — | 4 | 16,287 | 16,287 | 14,487 | |||||||||||||
OTHER ASSETS | 2,362 | 2,362 | 3,168 | |||||||||||||||
Total Assets | $ | 711,792 | $ | 763,896 | $ | 809,197 | ||||||||||||
LIABILITIES | ||||||||||||||||||
CURRENT LIABILITIES | ||||||||||||||||||
Accounts payable | $ | 23,139 | $ | 23,139 | $ | 34,522 | ||||||||||||
Accrued liabilities | 51,857 | 51,857 | 53,935 | |||||||||||||||
Fair value of derivatives | 6,813 | 6,813 | — | |||||||||||||||
Asset retirement obligations | 11,445 | 11,445 | 23,485 | |||||||||||||||
Current tax liability | 714 | 714 | 1,128 | |||||||||||||||
Current debt | 7,327 | 7,327 | 10,014 | |||||||||||||||
Total Current Liabilities | 101,295 | 101,295 | 123,084 | |||||||||||||||
LONG TERM DEBT | 133,259 | 6 | (10,590 | ) | 122,669 | 117,290 | ||||||||||||
ASSET RETIREMENT OBLIGATIONS | 22,311 | 3 | 14,700 | 37,011 | 42,826 | |||||||||||||
CAPITAL LEASES | — | — | — | |||||||||||||||
NET DEFERRED TAX LIABILITY | 24,932 | 5 | 5,208 | 30,140 | 21,094 | |||||||||||||
Total Liabilities | $ | 281,797 | $ | 291,115 | $ | 304,294 | ||||||||||||
COMMITMENTS AND CONTINGENCIES | — | — | — | |||||||||||||||
SHAREHOLDERS’ EQUITY | ||||||||||||||||||
SHARE CAPITAL | ||||||||||||||||||
First preferred shares, without par value, unlimited shares authorized. | ||||||||||||||||||
No shares issued and outstanding | — | — | — | |||||||||||||||
Common shares, without par value, unlimited shares authorized. Shares issued and outstanding: 258,624,486 at September 30, 2011; 258,511,236 at December 31, 2010 | 693,784 | 693,784 | 693,487 | |||||||||||||||
CONTRIBUTED SURPLUS | 19,258 | 7 | 1,125 | 20,383 | 17,433 | |||||||||||||
EQUITY COMPONENT OF CONVERTIBLE NOTES | — | 6 | 34,542 | 34,542 | 34,542 | |||||||||||||
ACCUMULATED OTHER COMPREHENSIVE INCOME | 1,679 | 1,679 | 1,959 | |||||||||||||||
DEFICIT | (283,352 | ) | 4,475 | (278,877 | ) | (243,930 | ) | |||||||||||
TOTAL GOLDEN STAR EQUITY | 431,369 | 471,511 | 503,491 | |||||||||||||||
NONCONTROLLING INTEREST | (1,374 | ) | 8 | $ | 2,644 | 1,270 | 1,412 | |||||||||||
TOTAL EQUITY | $ | 429,995 | $ | 472,781 | $ | 504,903 | ||||||||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 711,792 | $ | 763,896 | $ | 809,197 |
US GAAP | IFRS | IFRS | |||||||||||||||
For the three months ended | For the three months ended | For the three months ended | |||||||||||||||
September 30 2011 | Note | Adjustments | September 30 2011 | September 30 2010 | |||||||||||||
REVENUE | |||||||||||||||||
Gold revenues | $ | 125,880 | $ | 125,880 | $ | 103,651 | |||||||||||
Cost of sales | 106,385 | 1,2,3 | $ | 886 | 107,271 | 90,824 | |||||||||||
Mine operating margin | 19,495 | 18,609 | 12,827 | ||||||||||||||
Exploration expense | 1,824 | 4 | (735 | ) | 1,089 | 637 | |||||||||||
General and administrative expense | 5,996 | 7 | 106 | 6,102 | 3,943 | ||||||||||||
Abandonment and impairment | — | 4 | — | — | 3 | ||||||||||||
Derivative mark-to-market gains | 13,245 | 6 | (2,085 | ) | 11,160 | (311 | ) | ||||||||||
Property holding costs | 1,778 | 1,778 | 1,557 | ||||||||||||||
Foreign exchange loss | 666 | 666 | 313 | ||||||||||||||
Interest expense | 2,193 | 6 | 1,906 | 4,099 | 4,341 | ||||||||||||
Interest and other income | (61 | ) | (61 | ) | (48 | ) | |||||||||||
Gain on sale of assets | (338 | ) | (338 | ) | — | ||||||||||||
Income/(loss) before income tax | (5,808 | ) | (5,886 | ) | 2,392 | ||||||||||||
Income tax expense | (3,621 | ) | 5 | 683 | (2,938 | ) | (487 | ) | |||||||||
Net income/(loss) | $ | (9,429 | ) | $ | (8,824 | ) | $ | 1,905 | |||||||||
Net income attributable to noncontrolling interest | 767 | 8 | (203 | ) | 564 | 61 | |||||||||||
Net income/(loss) attributable to Golden Star shareholders | (10,196 | ) | (9,388 | ) | 1,844 | ||||||||||||
Net income/(loss) attributable to Golden Star shareholders per share: | |||||||||||||||||
Basic | $ | (0.039 | ) | $ | (0.036 | ) | $ | 0.007 | |||||||||
Diluted | $ | (0.039 | ) | $ | (0.036 | ) | $ | 0.007 | |||||||||
Weighted average shares outstanding (millions) | 258.6 | 258.6 | 258.2 | ||||||||||||||
Weighted average number of diluted shares (millions) | 258.6 | 258.6 | 260.2 | ||||||||||||||
OTHER COMPREHENSIVE INCOME/(LOSS) | |||||||||||||||||
Net income/(loss) | $ | (9,429 | ) | $ | (8,824 | ) | $ | 1,905 | |||||||||
Other comprehensive (income)/loss | 59 | 59 | 310 | ||||||||||||||
Comprehensive income/(loss) | $ | (9,488 | ) | $ | (8,883 | ) | $ | 2,215 | |||||||||
Comprehensive income/(loss) attributable to Golden Star shareholders | $ | (10,255 | ) | $ | (9,447 | ) | $ | 2,154 | |||||||||
Comprehensive income attributable to noncontrolling interest | 767 | 8 | $ | (203 | ) | 564 | 61 | ||||||||||
Comprehensive income/(loss) | $ | (9,488 | ) | $ | (8,883 | ) | $ | 2,215 | |||||||||
Deficit, beginning of period | (273,156 | ) | (269,489 | ) | (234,687 | ) | |||||||||||
Deficit, end of period | $ | (283,352 | ) | $ | (278,877 | ) | $ | (232,843 | ) |
US GAAP | IFRS | IFRS | |||||||||||||||
For the nine months ended | For the nine months ended | For the nine months ended | |||||||||||||||
September 30 2011 | Note | Adjustments | September 30 2011 | September 30 2010 | |||||||||||||
REVENUE | |||||||||||||||||
Gold revenues | $ | 352,193 | $ | 352,193 | $ | 327,222 | |||||||||||
Cost of sales | 316,661 | 1,2,3 | $ | (329 | ) | 316,332 | 279,646 | ||||||||||
Mine operating margin | 35,532 | 35,861 | 47,576 | ||||||||||||||
Exploration expense | 3,972 | 4 | (1,966 | ) | 2,006 | 1,315 | |||||||||||
General and administrative expense | 20,350 | 7 | 252 | 20,602 | 13,191 | ||||||||||||
Abandonment and impairment | — | 4 | 167 | 167 | 350 | ||||||||||||
Derivative mark-to-market (gains)/losses | (4,368 | ) | 6 | 22,207 | 17,839 | 436 | |||||||||||
Property holding costs | 6,141 | 6,141 | 3,855 | ||||||||||||||
Foreign exchange loss | 1,385 | 1,385 | 884 | ||||||||||||||
Interest expense | 6,663 | 6 | 5,792 | 12,455 | 12,637 | ||||||||||||
Interest and other income | (163 | ) | (163 | ) | (343 | ) | |||||||||||
Gain on sale of investments | (336 | ) | (336 | ) | — | ||||||||||||
Income/(loss) before income tax | 1,888 | (24,235 | ) | 15,251 | |||||||||||||
Income tax expense | (11,727 | ) | 5 | 819 | (10,908 | ) | (5,430 | ) | |||||||||
Net income/(loss) | $ | (9,839 | ) | $ | (35,143 | ) | $ | 9,821 | |||||||||
Net income/(loss) attributable to noncontrolling interest | (523 | ) | 8 | 327 | (196 | ) | 2,121 | ||||||||||
Net income/(loss) attributable to Golden Star shareholders | (9,316 | ) | (34,947 | ) | 7,700 | ||||||||||||
Net income/(loss) attributable to Golden Star shareholders per share: | |||||||||||||||||
Basic | $ | (0.036 | ) | $ | (0.135 | ) | $ | 0.030 | |||||||||
Diluted | $ | (0.036 | ) | $ | (0.135 | ) | $ | 0.030 | |||||||||
Weighted average shares outstanding (millions) | 258.6 | 258.6 | 257.8 | ||||||||||||||
Weighted average number of diluted shares (millions) | 258.6 | 258.6 | 259.6 | ||||||||||||||
OTHER COMPREHENSIVE INCOME/(LOSS) | |||||||||||||||||
Net income/(loss) | $ | (9,839 | ) | $ | (35,143 | ) | $ | 9,821 | |||||||||
Other comprehensive (income)/loss | (280 | ) | (280 | ) | 650 | ||||||||||||
Comprehensive income/(loss) | $ | (9,559 | ) | $ | (34,863 | ) | $ | 10,471 | |||||||||
Comprehensive income/(loss) attributable to Golden Star shareholders | $ | (9,036 | ) | $ | (34,667 | ) | $ | 8,350 | |||||||||
Comprehensive income/(loss) attributable to noncontrolling interest | (523 | ) | 8 | $ | 327 | (196 | ) | 2,121 | |||||||||
Comprehensive income/(loss) | $ | (9,559 | ) | $ | (34,863 | ) | $ | 10,471 | |||||||||
Deficit, beginning of period | (274,036 | ) | (243,930 | ) | (240,543 | ) | |||||||||||
Deficit, end of period | $ | (283,352 | ) | $ | (278,877 | ) | $ | (232,843 | ) |
US GAAP | IFRS | IFRS | |||||||||||||||
For the three | For the three | For the three | |||||||||||||||
months ended | months ended | months ended | |||||||||||||||
September 30 | September 30 | September 30 | |||||||||||||||
OPERATING ACTIVITIES: | 2011 | Note | Adjustments | 2011 | 2010 | ||||||||||||
Net income/(loss) | $ | (9,429 | ) | $ | 605 | $ | (8,824 | ) | $ | 1,905 | |||||||
Reconciliation of net loss to net cash provided by operating activities: | |||||||||||||||||
Depreciation, depletion and amortization | 15,621 | 2, 4 | 3,319 | 18,940 | 22.365 | ||||||||||||
Amortization of loan acquisition cost | 321 | 321 | 1,088 | ||||||||||||||
Abandonment and impairment | — | 4 | — | — | — | ||||||||||||
Gain on sale of equity investments | — | — | — | ||||||||||||||
Gain/Loss on sale of assets | (338 | ) | (338 | ) | 4 | ||||||||||||
Non cash employee compensation | 564 | 7 | 106 | 670 | 533 | ||||||||||||
Future income tax expense | 2,908 | 5 | (683 | ) | 2,225 | 317 | |||||||||||
Fair value (gain)/loss on derivatives | 1,700 | 1,700 | (312 | ) | |||||||||||||
Fair value (gain)/loss on convertible debt | 2,084 | 6 | (2,084 | ) | — | — | |||||||||||
Accretion of asset retirement obligations | 2,184 | 3 | (1,852 | ) | 332 | (2,005 | ) | ||||||||||
Reclamation expenditures | (8,416 | ) | (8,416 | ) | (1,934 | ) | |||||||||||
7,199 | 6,610 | 21,960 | |||||||||||||||
Changes in non-cash working capital: | |||||||||||||||||
Accounts receivable | (1,886 | ) | (1,886 | ) | 9,214 | ||||||||||||
Inventories | 1,177 | 2 | (146 | ) | 1,031 | (2,615 | ) | ||||||||||
Deposits | 147 | 147 | (1,495 | ) | |||||||||||||
Accounts payable and accrued liabilities | 4,265 | 4,265 | 6,388 | ||||||||||||||
Other | 565 | 6 | 1,905 | 2,470 | 1,977 | ||||||||||||
Net cash provided by operating activities | $ | 11,467 | $ | 12,637 | $ | 35,429 | |||||||||||
INVESTING ACTIVITIES: | |||||||||||||||||
Expenditures on deferred exploration projects | — | 4 | (736 | ) | (736 | ) | (988 | ) | |||||||||
Expenditures on mining properties | (12,211 | ) | 2 | $ | (434 | ) | (12,645 | ) | (20,070 | ) | |||||||
Expenditures on property, plant and equipment | (13,678 | ) | (13,678 | ) | (9,966 | ) | |||||||||||
Cash securing letters of credit (used)/refunded | (1,200 | ) | (1,200 | ) | — | ||||||||||||
Change in accounts payable and deposits on mine equipment and material | 2,499 | 2,499 | (5,186 | ) | |||||||||||||
Other | 681 | 681 | 1,846 | ||||||||||||||
Net cash used in investing activities | $ | (23,909 | ) | $ | (25,079 | ) | $ | (34,364 | ) | ||||||||
FINANCING ACTIVITIES: | |||||||||||||||||
Principal payments on debt | (2,622 | ) | (2,622 | ) | (8,814 | ) | |||||||||||
Proceeds from debt agreements and equipment financing | 1,391 | 1,391 | 11,168 | ||||||||||||||
Other | 52 | 52 | (646 | ) | |||||||||||||
Net cash provided by/(used in) financing activities | $ | (1,179 | ) | $ | (1,179 | ) | $ | 1,708 | |||||||||
Increase/(decrease) in cash and cash equivalents | (13,621 | ) | (13,621 | ) | 2,773 | ||||||||||||
Cash and cash equivalents, beginning of period | 127,915 | 127,915 | 181,232 | ||||||||||||||
Cash and cash equivalents end of period | $ | 114,294 | $ | 114,294 | $ | 184,005 |
US GAAP | IFRS | IFRS | |||||||||||||||
For the nine | For the nine | For the nine | |||||||||||||||
months ended | months ended | months ended | |||||||||||||||
September 30 | September 30 | September 30 | |||||||||||||||
OPERATING ACTIVITIES: | 2011 | Note | Adjustments | 2011 | 2010 | ||||||||||||
Net income/(loss) | $ | (9,839 | ) | $ | (25,304 | ) | $ | (35,143 | ) | $ | 9,821 | ||||||
Reconciliation of net loss to net cash provided by operating activities: | |||||||||||||||||
Depreciation, depletion and amortization | 52,113 | 2, 4 | 5,848 | 57,961 | 76,206 | ||||||||||||
Amortization of loan acquisition cost | 993 | 993 | 893 | ||||||||||||||
Abandonment and impairment | — | 4 | 167 | 167 | — | ||||||||||||
Gain on sale of equity investments | — | — | — | ||||||||||||||
Gain/Loss on sale of assets | (336 | ) | (336 | ) | 351 | ||||||||||||
Non cash employee compensation | 2,784 | 7 | 252 | 3,036 | 2,588 | ||||||||||||
Future income tax expense | 9,255 | 5 | (819 | ) | 8,436 | 3,655 | |||||||||||
Fair value (gain)/loss on derivatives | 6,879 | 6,879 | (631 | ) | |||||||||||||
Fair value gain on convertible debt | (22,208 | ) | 6 | 22,208 | — | — | |||||||||||
Accretion of asset retirement obligations | 5,300 | 3 | (4,304 | ) | 996 | 2,420 | |||||||||||
Reclamation expenditures | (20,244 | ) | (20,244 | ) | (5,534 | ) | |||||||||||
24,697 | 22,745 | 89,769 | |||||||||||||||
Changes in non-cash working capital: | |||||||||||||||||
Accounts receivable | (4,690 | ) | (4,690 | ) | (3,215 | ) | |||||||||||
Inventories | 756 | 2 | 21 | 777 | (6,926 | ) | |||||||||||
Deposits | (553 | ) | (553 | ) | (1,775 | ) | |||||||||||
Accounts payable and accrued liabilities | (14,534 | ) | (14,534 | ) | 10,991 | ||||||||||||
Other | (1,524 | ) | 6 | 5,792 | 4,268 | 6,017 | |||||||||||
Net cash provided by operating activities | $ | 4,152 | $ | 8,013 | $ | 94,861 | |||||||||||
INVESTING ACTIVITIES: | |||||||||||||||||
Expenditures on deferred exploration projects | — | 4 | (1,966 | ) | (1,966 | ) | (2,859 | ) | |||||||||
Expenditures on mining properties | (30,242 | ) | 2 | $ | (1,895 | ) | (32,137 | ) | (37,949 | ) | |||||||
Expenditures on property, plant and equipment | (33,541 | ) | (33,541 | ) | (27,255 | ) | |||||||||||
Cash securing letters of credit (used)/refunded | (1,200 | ) | (1,200 | ) | — | ||||||||||||
Change in accounts payable and deposits on mine equipment and material | (685 | ) | (685 | ) | (2,593 | ) | |||||||||||
Other | 681 | 681 | 4,066 | ||||||||||||||
Net cash used in investing activities | $ | (64,987 | ) | $ | (68,848 | ) | $ | (66,590 | ) | ||||||||
FINANCING ACTIVITIES: | |||||||||||||||||
Principal payments on debt | (7,960 | ) | (7,960 | ) | (25,224 | ) | |||||||||||
Proceeds from debt agreements and equipment financing | 4,861 | 4,861 | 25,674 | ||||||||||||||
Other | 210 | 210 | 1,196 | ||||||||||||||
Net cash provided by/(used in) financing activities | $ | (2,889 | ) | $ | (2,889 | ) | $ | 1,646 | |||||||||
Increase/(decrease) in cash and cash equivalents | (63,724 | ) | (63,724 | ) | 29,917 | ||||||||||||
Cash and cash equivalents, beginning of period | 178,018 | 178,018 | 154,088 | ||||||||||||||
Cash and cash equivalents, end of period | $ | 114,294 | $ | 114,294 | $ | 184,005 |
• | non-controlling interests; |
• | business combinations; |
• | share-based payment transactions; |
• | asset retirement obligations; and |
• | borrowing costs. |
1. | In-Process inventory - Costs that qualify as betterment stripping are capitalized as Mining Properties under IFRS, but are included within inventory and expensed for U.S. GAAP. As a result, the amount of waste mining costs expensed and included within in-process metal inventory is higher under U.S. GAAP than under IFRS. |
2. | Deferred Stripping - Under IFRS, expenditures for stripping costs (i.e., the costs of removing overburden and waste material to access mineral deposits) that can be shown to be a betterment of the mineral property are capitalized and subsequently amortized on a units-of-production basis over the mineral reserves that directly benefit from the specific waste stripping activity. U.S. GAAP has no provision for capitalization of betterment stripping costs. Thus in periods where betterment stripping occurs, operating costs are higher under U.S. GAAP since all waste costs are expensed. The amounts of capitalized betterment stripping are shown in the table immediately below and are included in the Mining Properties totals shown in the IFRS consolidated balance sheets. |
Wassa/HBB | Bogoso/Prestea | TOTAL | |||||||||
Balance as of December 31, 2010 | $ | 12,935 | $ | 5,558 | $ | 18,493 | |||||
Additions in the nine months ended September 30, 2011 | — | 1,890 | 1,890 | ||||||||
Amortization of betterment stripping assets | (6,344 | ) | — | (6,344 | ) | ||||||
Balance as of September 30, 2011 | $ | 6,591 | $ | 7,448 | $ | 14,039 |
3. | Forecasted amounts of required future environmental, reclamation and closure costs are the same under U.S. GAAP and IFRS. However, differences exist in determining the discount rate to be applied to the future costs. Under U.S. GAAP, the estimated liability for future reclamation and closure costs of each period's new environmental disturbances are discounted at the prevailing discount rates in effect during the period of the new disturbance and once the discount rate is applied, it is not revised in subsequent periods. This in effect creates layers of liability for new disturbances incurred in each time period. Under IFRS, at the end of each period, the entire pool of all estimated future cash costs for existing disturbances are discounted using the discount rate existing at the end of each period. |
4. | Under U.S. GAAP, mineral property acquisition costs are capitalized. Pre-acquisition costs and subsequent exploration, mine development and direct general and administrative costs are expensed as incurred until such time as a feasibility study shows that the mineral property is economically viable. Following completion of a viable feasibility study all subsequent exploration, development and direct general and administrative costs are capitalized. For IFRS purposes, all exploration, mine development, acquisition and direct general and administrative costs related to exploration and development projects are capitalized into Deferred Exploration once sufficient work has been performed to demonstrate that an exploration asset exists. In each subsequent period, under IFRS, the exploration, engineering, development, financial and market information for each exploration project is reviewed by management to determine if such capitalized exploration and development costs are impaired. If found impaired, the exploration asset's cost basis is reduced in accordance with IFRS provisions. Amounts written off in the current year under IFRS, which have previously been expensed under U.S. GAAP, result in an adjustment when reconciling net income for the year. |
Deferred Exploration & Development Costs as of 12/31/2010 | Capitalized Exploration Expenditures | Impairments | Other | Deferred Exploration & Development Costs as of 9/30/2011 | |||||||||||||||
AFRICAN PROJECTS | |||||||||||||||||||
Ghana | $ | 8,047 | $ | 2,285 | $ | (166 | ) | $ | — | $ | 10,166 | ||||||||
Sonfon - Sierra Leone | 4,271 | 473 | — | (792 | ) | 3,952 | |||||||||||||
Other Africa | 1,018 | — | — | — | 1,018 | ||||||||||||||
SOUTH AMERICAN PROJECTS | |||||||||||||||||||
Saramacca - Suriname | 1,151 | — | — | — | 1,151 | ||||||||||||||
Total | $ | 14,487 | $ | 2,758 | $ | (166 | ) | $ | (792 | ) | $ | 16,287 |
5. | Income tax - The application of U.S. GAAP and IFRS tax accounting is the same for the company. The difference in the tax liability and expense arise from the changes in reported pre-tax income or loss under the different GAAPs as well as the differing treatment of various assets and liabilities. |
6. | Convertible debentures - Under U.S. GAAP, convertible debt is measured at fair value at each reporting date with changes in fair value shown in the statement of operations. Fair value includes the value of the future stream of cash flows from the debt plus the fair value of the option component attached to the debenture. Fair value of the interest and principal is determined by discounting the cash flows at our external cost of funds. Fair value of the option component is determined using a Black-Scholes option pricing model. Under IFRS, the convertible debentures are separated into a liability and equity component. The fair value of the liability is determined at the origination of the debentures based on discounted cash flows of the future interest and principal, with the residual allocated to the equity portion. The amount of the liability is subsequently accreted through interest expense up to the full $125 million face value over the life of the debentures. |
7. | Shareholders' Equity - Differences in Contributed Surplus reflect differences in stock option expense recognition. Under U.S. GAAP, the expense for a grant is recognized evenly over the vesting period of the grant. Under IFRS we expense each tranche of a grant evenly over that tranche's vesting period. |
8. | Noncontrolling interest - The application of non-controlling interest accounting is the same under U.S. GAAP and IFRS. The difference in the recognized equity account and related expense arise from the changes in reported income or loss under the different GAAPs. |
9. | Recently issued IFRS accounting standards - IAS 1 Presentation of Items of Other Comprehensive Income (“OCI”) - IAS 1 is intended to change the disclosure of items presented in Other Comprehensive Income (“OCI”), including a requirement to separate items presented in OCI into two groups based on whether or not they may be recycled to profit or loss in the future. The new pronouncement is effective for years beginning on or after January 1, 2012. Certain provisions of this pronouncement will be effective for us beginning in 2012. It is expected that these provisions will not have a material impact on our consolidated IFRS financial statements. |