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Rare Element – REE – Announces Year End and Fourth Quarter Financial Results

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Rare Element Resources Ltd. (NYSE: REE) announced that its audited consolidated financial statements and Form 10-K for the year ended June 30, 2012 have been filed .

As to the completion of the fiscal year and financial report filing, Randall J. Scott, President and Chief Executive Officer stated, “This was a year of continued substantial progress for our Bear Lodge Property. With a planned 15,000 meter calendar year 2012 drill program, and encouraging results to-date, the future of this exceptional project is coming together in a timely way. We look forward to continuing to meet our goals and milestones as we move toward production and will be keeping our shareholders up to date as we work diligently throughout the remainder of 2012 and into 2013.”

REE – Fourth Quarter Ended June 30, 2012 Financial Highlights:

As an exploration company, we do not report revenues at this time. The net loss for the fourth quarter ended June 30, 2012 totaled $8.6 million or $0.19 per share as compared to a net loss of $7.1 million or $0.16 per share for the same period in 2011. The $1.5 million negative variance in net loss between the periods was due to the following:

  • Increased corporate administrative expenses, excluding stock-based compensation expense, due to a larger number of employees ($1.1 million);
  • Increased exploration spending at the Bear Lodge property ($1.0 million);
  • Write-downs of exploration properties during 2012 ($0.9 million);
  • Increased foreign exchange loss due to the impacts on the Company’s Canadian dollar cash balances related to exchange rate fluctuations in the US dollar on the balance sheet date ($0.5 million);
  • Positive variance in stock-based compensation of $2.1 million due primarily to a lower share price and smaller number of options granted; and
  • Negative variances in non-operating income and expenses amounted to $0.1 million.

Cash and cash equivalents, and short-term investments at June 30, 2012 were $51.6 million compared to $56.0 million as of March 31, 2012. The $4.4 million decrease in cash and cash equivalents was primarily due to exploration, corporate administrative costs, and foreign exchange losses on our Canadian cash balances.

REE – Fiscal Year Ended June 30, 2012 Financial Highlights:

The net loss for the year ended June 30, 2012 totaled $35.0 million or $0.79 per share as compared to a net loss of $16.7 million or $0.43 per share for the same period in 2011. The $18.3 million negative variance in net loss between the periods was due to the following:

  • Increased exploration spending at the Bear Lodge property ($6.7 million);
  • Increased foreign exchange loss due to the impacts on the Company’s Canadian dollar cash balances related to exchange rate fluctuations in the US dollar on the balance sheet dates ($5.7 million);
  • Increased corporate administrative expenses, excluding stock-based compensation expense, due to Bear Lodge Project development related expenditures and due to more employees ($3.3 million);
  • Increased non-cash stock-based compensation expense due primarily an increase in the number of employees and the effects of expensing past grants ($3.3 million);
  • Write-downs of exploration properties during 2012 ($1.9 million);
  • Positive variance in unrealized losses on derivatives due to decreases in the stock price between periods ($2.4 million); and
  • Positive variance in interest income of $0.2 million.

Cash and cash equivalents and short-term investments decreased $20.6 million for the year ended June 30, 2012. The decrease in cash and investments was primarily due to spending for exploration, corporate administrative and Bear Lodge development related costs, and foreign exchange losses on translating our Canadian cash balances to U. S. dollars.

About Rare Element Resources Ltd. –  REE

Rare Element Resources Ltd. (REE) is a publicly traded mineral resource company focused on exploration and development of rare-earth elements and gold on the Bear Lodge property located in northeastern Wyoming, USA.

Rare-earth elements are key components of the green energy technologies and other high-technology applications. Some of the major applications include hybrid automobiles, plug-in electric automobiles, advanced wind turbines, computer hard drives, compact fluorescent lights, metal alloys, additives in ceramics and glass, petroleum cracking catalysts, and a number of critical military applications. China currently produces more than 95 percent of the 130,000 metric tonnes of rare-earths consumed annually worldwide, and China has been reducing its exports of rare-earths each year. The rare-earth market is growing rapidly, and is projected to accelerate if green technologies continue to be implemented on a broad scale.

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edliston
Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.

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Ed Liston

Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing.

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