Ivanhoe Electric (US:IE)2025-05-06 20:40Financial Performance - The company recorded a net loss attributable to common stockholders of $30.5 million ($0.24 per share) for the three months ended March 31, 2025, a decrease of $25.0 million compared to a net loss of $55.5 million ($0.46 per share) for the same period in 2024 [77]. - General and administrative expenses were $11.6 million for the three months ended March 31, 2025, a decrease of $1.0 million from $12.6 million for the same period in 2024 [79]. - Net cash used in operating activities was $15.8 million in Q1 2025, primarily due to $15.4 million in exploration expenditures and $9.0 million in general and administrative costs [100]. - Cash and cash equivalents increased to $98.2 million as of March 31, 2025, compared to $41.0 million at the end of 2024, with working capital rising to $77.1 million from $35.9 million [88]. - The share of loss from equity method investees was $5.0 million for the three months ended March 31, 2025, an increase of $2.0 million from $3.0 million for the same period in 2024 [80]. Exploration and Project Development - Exploration expenses were $15.8 million for the three months ended March 31, 2025, a decrease of $27.9 million from $43.6 million for the same period in 2024 [78]. - The Initial Assessment for the Santa Cruz Project estimates life of mine copper production of 1.6 million tonnes over a 20-year mine life, with projected cash costs of $1.36 per pound of copper produced [64]. - The Santa Cruz Project is expected to focus on an underground copper mine with an average of 5.5 million tonnes mined annually from high-grade domains [64]. - The Santa Cruz Project incurred $6.5 million in expenditures in Q1 2025, significantly lower than the $27.8 million spent in Q1 2024, focusing on technical engineering studies [83]. - The company has not generated any revenue from its mining projects as they are still in the exploration stage [70]. Revenue Generation - CGI generated revenue of $0.7 million from software licensing and data processing services for the three months ended March 31, 2025, compared to $0.4 million for the same period in 2024 [81]. - Software licensing and data processing services revenue increased to $735,000 for the three months ended March 31, 2025, up 104% from $360,000 in the same period of 2024 [82]. - Gross profit for the same period was $442,000, representing a 70% increase from $260,000 year-over-year [82]. - CGI's revenue rose to $700,000 in Q1 2025, an increase of $300,000 from $400,000 in Q1 2024, attributed to more data processing services [84]. Financing and Capital Structure - The company completed a public offering on February 14, 2025, issuing 11,794,872 units at a price of $5.85 per unit for net proceeds of approximately $66.0 million [68]. - The company completed a public offering in Q1 2025, issuing 11,794,872 units at $5.85 per unit, resulting in net proceeds of approximately $65.6 million [102]. - As of May 6, 2025, the company anticipates needing additional financing within the next 12 months to advance its projects, particularly if a development decision is made at the Santa Cruz Project [89]. - The company has not generated revenue from its mining projects and does not expect to do so in the foreseeable future, relying primarily on equity securities for funding [87]. Debt and Interest Expense - The company has fixed-rate debt consisting of a convertible bond with an interest rate of 8.0% per annum and a related party loan at 10.0% per annum [117]. - The variable-rate debt includes a secured promissory note with an annual interest rate of U.S. prime plus 1%, totaling $12.1 million due in installments from November 2025 to 2027 [118]. - A sensitivity analysis indicated that a hypothetical 100 basis points adverse movement in the prime rate would increase interest expense and net loss by approximately $0.1 million for the three months ended March 31, 2025 [119]. Foreign Currency Risk - The company incurred foreign currency risk primarily in Colombia and Canada, with monetary assets and liabilities in Colombian Pesos and Canadian dollars [120]. - As of March 31, 2025, the Colombian Peso appreciated by 4.7% against the U.S. dollar, while the Canadian dollar appreciated by 0.1% [121]. - A 10% depreciation or appreciation of foreign currencies against the U.S. dollar would result in an approximate $0.5 million decrease or increase in the company's net loss for the three months ended March 31, 2025 [121]. - The carrying amount of Colombian Peso monetary assets and liabilities was approximately $2.639 million, while Canadian dollar balances were about $2.853 million as of March 31, 2025 [121]. Tax Position - The company had no uncertain tax positions as of March 31, 2025, indicating a stable tax position [115]. - The realization of deferred tax assets is contingent on future taxable income generation, with potential changes in estimates affecting the valuation allowance [114].