Austin Gold Corp. — FY2022 Form 20-F
Reporting period: Fiscal year ended December 31, 2022. This is an annual report, not a standalone fourth-quarter filing. The audited consolidated financial statements are prepared under IFRS and presented in U.S. dollars; comparative figures were restated to U.S. dollars after the company changed its presentation currency.
Business context
Austin Gold is an early-stage gold exploration company with five exploration properties in Nevada and Oregon. It has no producing mines, operating revenue, or established mineral resources or reserves. Its common shares trade on NYSE American as AUST. The company completed its IPO in May 2022, raising $15.019 million gross and $13.853 million net of issuance costs.
Key financial metrics
| Metric (US$) | FY2022 | FY2021 |
|---|---|---|
| Revenue | 0 | 0 |
| Net loss | 1.068 million | 401,105 |
| Comprehensive loss | 1.787 million | 379,644 |
| Basic and diluted loss per share | 0.09 | 0.04 |
| Cash used in operating activities | 1.792 million | 276,699 |
| Cash and cash equivalents at year-end | 630,623 | 1.095 million |
| Short-term investments at year-end | 11.649 million | 0 |
| Exploration and evaluation assets | 2.369 million | 1.286 million |
| Total assets | 14.878 million | 2.592 million |
| Total liabilities | 97,825 | 60,773 |
Year-end cash plus short-term investments totaled approximately $12.280 million. The company reported a working-capital surplus of $12.393 million. The balance sheet lists current payables and accrued liabilities, with no material debt balance reported. No dividends have been paid.
Changes and operating results
- Net loss increased by $667,286 year over year, primarily as administrative expenses rose to $1.717 million from $289,268. Increases included management and consulting fees, insurance, IPO/listing costs, share-based compensation, and marketing.
- Foreign-exchange gain was $640,324, while the unrealized loss on marketable securities was $174,634. The latter reflected a decline in the value of the company’s NGE investment. Comprehensive loss also included a $718,921 currency translation loss.
- Operating cash use increased substantially. Investing cash use was $12.517 million, principally reflecting purchases of short-term investments, partly offset by redemptions; financing cash inflow was $13.853 million, net of IPO costs.
- Exploration and evaluation assets increased to $2.369 million. The company reported $1.066 million of cash E&E expenditures during 2022.
Projects, outlook, and principal risks
- Exploration results: At Kelly Creek, a four-hole, 3,485-foot 2022 program encountered difficult drilling and groundwater inflows; holes did not reach their targeted depth. The highest reported gold values were 0.087 and 0.056 g/t. The company was evaluating next steps.
- Subsequent event: The initial Fourmile Basin program was completed in early 2023, after year-end. Five holes totaled 4,580 feet; reported gold values included 0.106 and 0.065 g/t in alluvium, with a highest bedrock value of 0.020 g/t. Analysis was ongoing.
- BLM approvals were received in Q4 2022 for drilling at Fourmile Basin and for access roads and drilling at Stockade Mountain; further permitting, including Oregon state review for Stockade, remained in progress. The company also planned exploration work at Lone Mountain and Miller.
- Management estimated existing working capital would fund the current activity level for at least the next 12 months, but the company has no operating cash flow and expects to rely on financing. Further exploration and any eventual mine development would require additional capital and could dilute shareholders.
- Key risks include the speculative nature of exploration, absence of resources or reserves, uncertain project economics, permitting and environmental requirements, title and surface-access issues, future financing availability, gold-price and currency volatility, and property lease, royalty, and work commitments. At Kelly Creek, wetlands and the Humboldt River may complicate development; a planned solar facility may affect access to some claims.
- The company believes it was a passive foreign investment company for the most recently completed U.S. tax year and expects it may remain one; U.S. investors should review the filing’s tax disclosures with an adviser.
Investor verification points
- Review the audited IFRS statements and cash-flow detail, especially the composition, maturity dates, and liquidity of the $11.649 million in short-term investments.
- Verify subsequent exploration results and permitting progress, distinguishing post-year-end Fourmile results from FY2022 results.
- Check the status and cost of exploration commitments, particularly Kelly Creek’s earn-in spending milestones and Miller’s drilling obligations.
- Assess whether management’s stated 12-month funding runway remains adequate against planned exploration, property payments, and corporate costs.
- Confirm current share count, potential dilution from options and warrants, and the implications of insider ownership of approximately 50%.
The independent auditor issued an unmodified opinion on the financial statements. Management reported effective disclosure controls and internal control over financial reporting at December 31, 2022; the auditor did not provide an internal-control attestation because the company qualified as an emerging growth company.