Following the sale of its La Camorra gold mine in Bolivar state, Venezuela,
Monarch sold La Camorra and its exploration properties in Venezuela and Mexico to
In 1998, Monarch lost US$892,000 on revenue of US$4.1 million in the third quarter, but made a profit of US$2.6 million on revenue of US$11.7 million in the first nine months. The profit was the result of a 1998 asset sales worth US$7.9 million.
Monarch’s sale of La Camorra brought in US$9 million and 6.7 million shares of Hecla, a block that then had a market value of US$15.5 million. The sale also translated into a balance-sheet loss of US$117,000 in the third quarter and US$1.7 million for the first three quarters of 1999.
Monarch retains a royalty on future production from La Camorra that exceeds recoverable reserves at the time the mine was sold, and a half-interest in unrecovered tax losses. Hecla can claim costs related to employee and contractor termination at La Camorra, and for unrecorded liabilities. Monarch has set aside about US$1 million to cover those contingencies.
The sale of its properties meant that Monarch no longer met Toronto Stock Exchange listing standards. The exchange set a deadline of December 1999 for the company to fall in line, but Monarch has decided to allow its listing to lapse. It plans to move to another exchange.
With total assets of US$18.3 million and a working capital deficiency of US$853,000, Monarch will need additional capital to stay in operation beyond June 30, 2000, when principal payments come due on an existing loan.
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