FOR IMMEDIATE RELEASE
Contact:
Peter Charles
Thorium Power, Ltd.
Tel: (571) 730-1200
Email: pcharles@thoriumpower.com
Thorium Power Reports Fourth Quarter and Full Year 2008 Financial Results and
Provides Business Update
Achieves Full Year 2008 Adjusted Net Income of $3.7 million
McLEAN, VA — March 26, 2009 — Thorium Power, Ltd. (OTCBB:THPW), the leading developer of non-proliferative nuclear fuel technology and provider of comprehensive advisory services for emerging nuclear programs, today announced financial results for the fourth quarter and year ended December 31, 2008.
Revenue for the three months ended December 31, 2008 was $7.4 million. Operating loss for the three months ended December 31, 2008 was $2.4 million. Operating loss for the fourth quarter included approximately $2.0 million of non-cash items. Net loss for the three months ended December 31, 2008 was $1.9 million. Excluding the impact of non-cash items, adjusted net income for the three months ended December 31, 2008 would have been $0.1 million (see “About Non-GAAP Financial Measures” near the end of this release).
Revenue for the twelve months ended December 31, 2008 was $22.2 million. Operating loss for the twelve months ended December 31, 2008 was $3.0 million. Operating loss for the twelve months ended December 31, 2008 included approximately $6.6 million of non-cash items. Net loss for the twelve months ended December 31, 2008 was $2.9 million. Excluding the impact of non-cash items, adjusted net income for the twelve months ended December 31, 2008 would have been $3.7 million (see “About Non-GAAP Financial Measures” near the end of this release).
As of December 31, 2008, the company had approximately $5.6 million of cash and cash equivalents and $6.8 million of working capital.
Seth Grae, Chief Executive Officer, commented: “It is clear to us that nuclear power is gaining favor globally as a viable, cost-effective, carbon-emissions-free alternative to fossil fuels. We have assembled an industry-leading team that includes the top talent from within the nuclear industry, and we look to play an important role as nuclear power is developed and deployed worldwide.”
“Since launching our nuclear advisory services in early 2008, the practice has provided over $22 million in revenues. Our proprietary, nuclear fuel designs are also progressing. We are moving forward with preparations of preliminary licensing documentation for our VVER fuel assembly design required for regulatory approval of our lead-test assembly testing in a VVER-1000 reactor. As part of these activities, we plan to conduct mechanical tests of certain key fuel assembly components as well as perform additional thermal-hydraulic experiments on a fuel assembly model. The critical technological activities now underway comprise key elements of the pre-commercialization, fuel qualification and verification process.”
Further, as we seek to expand the scope of our technology development towards western-style reactor fuel designs, we are encouraged by the positive developments regarding the use of thorium as the basis for non-proliferative, low-waste fuel designs both in the U.S. and abroad. In October 2008, Senator Orrin Hatch (R-UT) and Senate Majority Leader Harry Reid (D-NV) introduced the ‘2008 Thorium Energy Independence and Security Act’ to strengthen the technical capability of the United States to assess thorium-based nuclear fuels for commercial purposes. The introduction of this legislation illustrates increased awareness of and growing support for thorium as an alternative to traditional nuclear fuel designs for the generation of electricity.”
Mr. Grae concluded: “From a strategic and long-term perspective, we believe the future of nuclear power lies in timely, essential and viable solutions. That is why we are playing a leading role in providing the world with an advanced blueprint for clean nuclear power generation as well as innovative nuclear fuel designs.”
About Non-GAAP Financial Measures
This press release contains non-GAAP financial measures for earnings that exclude non-cash items. Net income excluding non-cash items is not a measure of performance calculated in accordance with generally accepted accounting principles in the United States (“GAAP”). The Company believes the presentation of net income excluding non-cash expense is relevant and useful by enhancing the readers’ ability to understand the Company’s operating performance. The Company’s management utilizes net income excluding non-cash expense as a means to measure operating performance. The table below reconciles adjusted net income excluding non-cash expense, a non-GAAP measure, to GAAP net income for the three months and year ended December 31, 2008.
| (in thousands) | ||||||||
| Year Ended | Three Months Ended | |||||||
| December 31, | December 31, | |||||||
| 2008 | 2008 | |||||||
| GAAP Net loss | $ | (2,859 | ) | $ | (1,927 | ) | ||
| Adjustments: | ||||||||
| Cost of Sales – non-cash employee compensation | 856 | 548 | ||||||
| Operating Expenses – non-cash employee compensation | 5,690 | 1,498 | ||||||
| Adjusted Net Income | $ | 3,687 | $ | 119 | ||||
About Thorium Power, Ltd.
Thorium Power is a pioneering U.S. nuclear energy company based in McLean, VA. The Company develops non-proliferative nuclear fuel technology and provides comprehensive advisory services for emerging nuclear programs based on a philosophy of transparency, non-proliferation, safety and operational excellence. Thorium Power’s technologies, which are aimed at both existing and future reactors, include nuclear fuel designs optimized to address key concerns regarding traditional nuclear power, including proliferation of weapons usable nuclear materials and reduction of nuclear waste. The Company maintains a seasoned team with unparalleled experience from the nuclear energy industry, regulatory and government affairs, non-proliferation and diplomacy. It leverages those broad and integrated capabilities by offering consulting and strategic advisory services to commercial entities and governments with a need to establish or expand nuclear industry capabilities and infrastructure. Thorium Power also maintains long-standing relationships with leading Russian nuclear entities, providing expert resources and facilities for its nuclear fuel development activities. The Company seeks and forms partnerships with participants in the global nuclear industry, allowing it to address a wide range of international opportunities.
DISCLAIMER
This press release may include certain statements that are not descriptions of historical facts, but are forward-looking statements. These forward-looking statements may include the description of our plans and objectives for future operations, assumptions underlying such plans and objectives, statements regarding revenues in the range of $22 million to $27 million and other statements identified by forward-looking terminology such as "may," "expects," "believes," "anticipates," "intends," "expects," "projects" or similar terms, variations of such terms or the negative of such terms. There are a number of risks and uncertainties that could cause actual results to differ materially from the forward-looking statements made herein. Such information is based upon various assumptions made by, and expectations of, our management that were reasonable when made but may prove to be incorrect. All of such assumptions are inherently subject to significant economic and competitive uncertainties and contingencies beyond our control and upon assumptions with respect to the future business decisions which are subject to change. Accordingly, there can be no assurance that actual results will meet expectations and actual results may vary (perhaps materially) from certain of the results anticipated herein. Reference is made to the risk factors contained in our latest annual report as filed with the Securities and Exchange Commission. These factors may cause actual results to vary from the forward-looking statements contained in this release.
Further information is available on Thorium Power, Ltd.'s website at http://www.thoriumpower.com
(tables follow)
Thorium Power Ltd.
Condensed Consolidated Balance Sheets
| December 31 | ||||||||
| 2008 | 2007 | |||||||
| ASSETS | ||||||||
| Current Assets | ||||||||
| Cash and cash equivalents | $ | 5,580,244 | $ | 9,907,691 | ||||
| Restricted cash | 650,000 | 0 | ||||||
| Accounts receivable - project revenue and reimbursable project costs | 5,357,804 | 0 | ||||||
| Prepaid expenses & other current assets | 394,315 | 204,035 | ||||||
| Deferred project costs | 0 | 371,631 | ||||||
| Total Current Assets | 11,982,363 | 10,483,357 | ||||||
| Property Plant and Equipment -net | 108,121 | 30,676 | ||||||
| Other Assets | ||||||||
| Patent costs - net | 217,875 | 217,875 | ||||||
| Security deposits | 138,418 | 2,049 | ||||||
| Total Other Assets | 356,293 | 219,924 | ||||||
| Total Assets | $ | 12,446,777 | $ | 10,733,957 | ||||
| LIABILITIES AND STOCKHOLDERS EQUITY | ||||||||
| Current Liabilities | ||||||||
| Accounts payable and accrued liabilities | $ | 5,138,979 | $ | 2,122,649 | ||||
| Current portion long term debt | 0 | 4,651 | ||||||
| Customer deposit | 0 | 1,206,875 | ||||||
| Deferred revenue | 0 | 3,793,125 | ||||||
| Total Current Liabilities | 5,138,979 | 7,127,300 | ||||||
| Notes Payable - long term | 0 | 5,782 | ||||||
| Total Liabilities | 5,138,979 | 7,133,082 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders' Equity | ||||||||
| Preferred stock, $0.001 par value, 50,000,000 authorized shares, no shares issued and outstanding | - | - | ||||||
| Common stock, $0.001par value, 500,000,000 authorized, 301,493,084 shares issued and outstanding at December 31, 2008 and 299,014,182 shares issued and outstanding at December 31, 2007 | 301,493 | 299,014 | ||||||
| Additional paid in capital - stock and stock equivalents | 48,607,451 | 41,791,735 | ||||||
| Deficit | (41,489,974 | ) | (38,630,572 | ) | ||||
| Common stock reserved for issuance, 484,055 shares and 2,000,000 shares at December 31, 2008 and 2007, respectively | 114,787 | 590,000 | ||||||
| Accumulated other comprehensive income | 0 | 30,143 | ||||||
| Deferred stock compensation | (225,959 | ) | (479,445 | ) | ||||
| Total Stockholders' Equity | 7,307,798 | 3,600,875 | ||||||
| Total Liabilities and Stockholders' Equity | $ | 12,446,777 | $ | 10,733,957 | ||||
The accompanying notes are an integral part of these consolidated financial statements
Thorium Power Ltd.
Consolidated Statements of Operations and Comprehensive Loss
| For the Years Ended | ||||||||
| December 31, | ||||||||
| 2008 | 2007 | |||||||
| Revenue: | ||||||||
| Consulting revenue | $ | 22,219,905 | $ | 0 | ||||
| Total Revenue | 22,219,905 | 0 | ||||||
| Cost of Consulting Services Provided | 11,088,723 | 0 | ||||||
| Gross Margin | 11,131,182 | 0 | ||||||
| Operating Expenses | ||||||||
| General and administrative | 6,958,165 | 6,259,317 | ||||||
| Research and development expenses | 1,565,594 | 756,755 | ||||||
| Stock-based compensation | 5,649,835 | 4,745,098 | ||||||
| Total Operating Expenses | 14,173,594 | 11,761,170 | ||||||
| Operating loss | (3,042,412 | ) | (11,761,170 | ) | ||||
| Other Income and (Expenses) | ||||||||
| Interest income | 162,893 | 367,187 | ||||||
| Other income and expenses | 30,143 | (58,600 | ) | |||||
| Total Other Income and Expenses | 193,036 | 308,587 | ||||||
| Net loss before income taxes | (2,849,376 | ) | (11,452,583 | ) | ||||
| Income taxes | 10,026 | 0 | ||||||
| Net loss | (2,859,402 | ) | (11,452,583 | ) | ||||
| Other Comprehensive Income (Loss) | ||||||||
| Unrealized gain on marketable securities | 0 | 11,282 | ||||||
| Total Comprehensive Loss | $ | (2,859,402 | ) | $ | (11,441,301 | ) | ||
| Net Loss Per Common Share, Basic and diluted | $ | (0.01 | ) | $ | (0.04 | ) | ||
| Weighted Average Number of shares outstanding for the period used to compute per share data | 300,070,925 | 296,666,502 | ||||||
The accompanying notes are an integral part of these consolidated financial statements
Thorium Power Ltd.
Consolidated Statements of Cash Flows
| For the Years Ended | ||||||||
| December 31, | ||||||||
| 2008 | 2007 | |||||||
| Operating Activities: | ||||||||
| Net Loss | $ | (2,859,402 | ) | $ | (11,452,583 | ) | ||
| Adjustments to reconcile net loss from operations to net cash used in operating activities: | ||||||||
| Stock based compensation | 6,546,493 | 4,978,981 | ||||||
| Depreciation and amortization | 24,668 | 8,582 | ||||||
| Realized gain on sale of securities | (30,143 | ) | 0 | |||||
| Settlement Expense | 0 | 58,601 | ||||||
| Changes in non-cash operating working capital items: | ||||||||
| Accounts receivable - fees and reimburseable project costs | (5,357,804 | ) | 0 | |||||
| Prepaid expenses and other current assets | (190,280 | ) | 321,966 | |||||
| Security deposits | (136,369 | ) | 0 | |||||
| Accounts payable, accrued liabilities and other current liabilities | 1,809,455 | 1,293,951 | ||||||
| Deferred revenue | (3,793,125 | ) | 3,793,125 | |||||
| Deferred project costs - net | 371,631 | 0 | ||||||
| Net Cash Used In Operating Activities | (3,614,876 | ) | (997,377 | ) | ||||
| Investing Activities: | ||||||||
| Purchase of office equipment | (102,113 | ) | (17,968 | ) | ||||
| Net Cash Used In Investing Activities | (102,113 | ) | (17,968 | ) | ||||
| Financing Activities: | ||||||||
| Proceeds from issue of common shares | 49,975 | 0 | ||||||
| Payments on notes payable and other | (10,433 | ) | (4,739 | ) | ||||
| Restricted cash | (650,000 | ) | 0 | |||||
| Net Cash Used In Financing Activities | (610,458 | ) | (4,739 | ) | ||||
| Net Decrease In Cash and Cash Equivalents | (4,327,447 | ) | (1,020,084 | ) | ||||
| Cash and Cash Equivalents, Beginning of Year | 9,907,691 | 10,927,775 | ||||||
| Cash and Cash Equivalents, End of Year | $ | 5,580,244 | $ | 9,907,691 | ||||
| Supplemental Disclosure of Cash Flow Information | ||||||||
| Cash paid during the year: | ||||||||
| Interest paid | $ | 0 | $ | 876 | ||||
| Income taxes paid | $ | 10,026 | $ | 0 | ||||
| Non-cash transactions | ||||||||
| Conversion of liabilities to equity | $ | 0 | $ | 278,441 | ||||
The accompanying notes are an integral part of these consolidated financial statements
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