- Terrain Minerals (TMX) released its September quarterly today, detailing a deeper operational cash burn and steady cash reserves
- Over the first quarter of the 2021 financial year, Terrain went cashflow-negative by $584,000
- Comparatively, the company burnt through just $131,000 on operations in the previous quarter, and $598,000 over the course of FY20
- The majority of the cash burn was chalked up to exploration costs, which took up $307,000 on Terrain’s operational balance sheet
- However, a share sale brought in nearly $400,000, which steadied the balance sheet and left the materials stock with $1.89 million in cash reserves
- Despite this, Terrain only has enough capital to continue operations for just three more quarters, meaning it may not be long before the company has to raise fresh funding
- On the back of today’s report, Terrain Minerals shares are trading 6.67 per cent lower, worth 1.4 cents
Terrain Minerals (TMX) released its September quarterly today, detailing a deeper operational cash burn and steady cash reserves.
Over the first quarter of the 2021 financial year, Terrain went cashflow-negative by $584,000. Comparatively, the company burnt through just $131,000 on operations in the previous quarter, and $598,000 over the course of FY20.
This means Terrains first quarter operational cash burn nearly equals the amount the company burnt through during the 2020 financial year.
The majority of the cash burn was chalked up to exploration costs, which took up $307,000 on Terrain’s operational balance sheet. At this stage, results from drilling campaigns at the company’s Wild-viper and Smokebush gold projects in WA are pending. In addition, the explorer spent just shy of $130,000 to cover staff, admin and corporate costs over the September quarter.
A government stimulus package grant was the only operational figure in the black — a $44,000 boost to this quarter’s financials. Even so, this came with a $194,000 net business activity statement (BAS) outgoing, which kept the company’s operations balance in the red.
Investment cashflow and reserves
Looking at Terrian’s investment-related cashflow, however, it’s a different story — the company netted nearly $400,000 over the period thanks to its sale of Red 5 shares. Significantly, it was the only investment cashflow activity tabled this quarter.
The sale kept Terrains cash reserves relatively steady, covering a fair chunk of the $584,000 operational burn. At the start of the September quarter, the materials stock had just over $2 million in the bank. Taking away this quarter’s operational cash burn and adding the proceeds from the share sale, it leaves $1.89 million to line Terrain’s pockets.
However, based on this quarter’s outgoings and its current cash reserves, the materials stock only has enough capital to continue operations for just three more quarters.
As a result, it may not be long before Terrain has to raise fresh funding to support its operations across its WA-based gold and base metal projects.
On the back of today’s report, Terrain Minerals shares are trading 6.67 per cent lower, worth 1.4 cents at 2:55 pm AEST.