Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Nov. 30, 2015 | Jan. 20, 2016 | May. 29, 2015 | |
Document And Entity Information | |||
Entity Registrant Name | NOVAGOLD RESOURCES INC | ||
Entity Central Index Key | 1,173,420 | ||
Document Type | 10-K | ||
Document Period End Date | Nov. 30, 2015 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --11-30 | ||
Is Entity a Well-known Seasoned Issuer? | Yes | ||
Is Entity a Voluntary Filer? | No | ||
Is Entity's Reporting Status Current? | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $ 798,815,000 | ||
Entity Common Stock, Shares Outstanding | 319,323,874 | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,015 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Nov. 30, 2015 | Nov. 30, 2014 |
ASSETS | ||
Cash and cash equivalents | $ 41,731 | $ 70,325 |
Term deposits | 85,000 | 95,000 |
Other assets | 3,310 | 3,735 |
Current assets | 130,041 | 169,060 |
Investment in Donlin Gold (note 4) | 1,058 | 1,618 |
Investment in Galore Creek (note 5) | 242,906 | 283,247 |
Mineral properties (note 6) | 43,605 | 50,897 |
Deferred income taxes (note 14) | 9,711 | 11,445 |
Other assets (note 7) | 6,263 | 8,279 |
Total assets | 433,584 | 524,546 |
LIABILITIES | ||
Accounts payable and accrued liabilities | 3,066 | 3,489 |
Convertible notes (note 8) | 0 | 15,112 |
Other liabilities | 451 | 625 |
Current liabilities | 3,517 | 19,226 |
Promissory note (note 9) | 80,261 | 76,153 |
Deferred income taxes (note 14) | 20,510 | 24,051 |
Total liabilities | $ 104,288 | $ 119,430 |
Commitments and contingencies (note 20) | ||
EQUITY | ||
Common shares Authorized - 1,000 million shares, no par value Issued and outstanding - 317.9 and 317.3 million shares, respectively | $ 1,938,262 | $ 1,936,336 |
Contributed surplus | 80,774 | 74,038 |
Accumulated deficit | (1,672,055) | (1,640,103) |
Accumulated other comprehensive income (loss) | (17,685) | 34,845 |
Total equity | 329,296 | 405,116 |
Total liabilities and equity | $ 433,584 | $ 524,546 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Nov. 30, 2015 | Nov. 30, 2014 |
Statement of Financial Position [Abstract] | ||
Common shares authorized | 1,000,000 | 1,000,000 |
Par value | $ 0 | $ 0 |
Common shares issued | 317,900 | 317,288 |
Common shares oustanding | 317,900 | 317,288 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Operating expenses: | |||
Equity loss - Donlin Gold (note 4) | $ 11,016 | $ 13,985 | $ 14,620 |
Equity loss - Galore Creek (note 5) | 392 | 1,941 | 13,352 |
General and administrative (note 11) | 19,887 | 22,046 | 26,991 |
Evaluation | 366 | 0 | 0 |
Depreciation | 35 | 36 | 37 |
Write-down of assets (note 12) | 0 | 0 | 776 |
Total operating expenses | 31,696 | 38,008 | 55,776 |
Loss from operations | (31,696) | (38,008) | (55,776) |
Total other income (expense) | (103) | (2,213) | (3,088) |
Loss before income taxes | (31,799) | (40,221) | (58,864) |
Income tax expense (note 14) | (153) | (263) | (3,896) |
Net loss | (31,952) | (40,484) | (62,760) |
Other comprehensive loss: | |||
Unrealized holding losses during period | (227) | (288) | (855) |
Reclassification adjustment for losses included in net income (note 17) | 426 | 0 | 2,738 |
Net unrealized gain (loss), net of $(2), $14 and $32 tax recovery (expense) | 199 | (288) | 1,883 |
Foreign currency translation adjustments | (52,729) | (29,371) | (34,687) |
Other comprehensive loss | (52,530) | (29,659) | (32,804) |
Comprehensive Loss | $ (84,482) | $ (70,143) | $ (95,564) |
Net loss per common share | |||
Basic and diluted | $ (0.10) | $ (0.13) | $ (0.2) |
Weighted average shares outstanding - basic and diluted | 317,850 | 317,203 | 313,372 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Operating activities: | |||
Net Loss | $ (31,952) | $ (40,484) | $ (62,760) |
Adjustments to reconcile net loss to net cash used in operating activities: | |||
Equity losses of affiliates | 11,408 | 15,926 | 27,972 |
Share-based compensation | 9,488 | 10,197 | 12,304 |
Interest on promissory note | 4,108 | 4,425 | 3,622 |
Accretion of convertible notes | 717 | 1,542 | 5,101 |
Depreciation | 35 | 36 | 37 |
Deferred income taxes | (2) | 74 | 3,606 |
Write-down of investments | 426 | 0 | 3,227 |
Write-down of assets | 0 | 0 | 776 |
Foreign exchange gain | (4,771) | (3,688) | (10,448) |
Other | (515) | (373) | (721) |
Withholding tax on share based compensation | (827) | (636) | (619) |
Net change in operating assets and liabilities (note 18) | 459 | 3,173 | (1,588) |
Net cash used in operations | (11,426) | (9,808) | (19,491) |
Investing activities: | |||
Proceeds from term deposits | 135,000 | 215,000 | 0 |
Purchases of term deposits | (125,000) | (200,000) | (110,000) |
Funding of affiliates | (10,964) | (15,946) | (18,793) |
Proceeds from sale of assets | 0 | (21) | (53) |
Net cash used in investing activities | (964) | (967) | (128,846) |
Financing activities: | |||
Proceeds from share issuance, net | 0 | 0 | 54,359 |
Repayment of debt | (15,829) | 0 | (79,171) |
Net cash provided from (used in) financing activities | (15,829) | 0 | (24,812) |
Effect of exchange rate changes on cash | (375) | (162) | (256) |
Decrease in cash and cash equivalents | (28,594) | (10,937) | (173,405) |
Cash and cash equivalents at beginning of period | 70,325 | 81,262 | 254,667 |
Cash and cash equivalents at end of period | $ 41,731 | $ 70,325 | $ 81,262 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands | Common Stock | Contributed Surplus | Accumulated deficit | Accumulated Other Comprehensive Income / Loss | Total |
Beginning Balance, shares at Nov. 30, 2012 | 279,927 | ||||
Beginning Balance, amount at Nov. 30, 2012 | $ 1,462,102 | $ 454,260 | $ (1,536,859) | $ 97,308 | $ 476,811 |
Net loss | (62,760) | 0 | (62,760) | ||
Other comprehensive loss | (32,804) | (32,804) | |||
Warrants issued/exercised, shares | 36,529 | ||||
Warrants issued/exercised, amount | $ 469,150 | (397,052) | 0 | 0 | 72,098 |
Share based compensation and related share issuances, shares | 205 | ||||
Share based compensation and related share issuances, amount | $ 2,701 | 9,603 | 0 | 0 | 12,304 |
Ending Balance, shares at Nov. 30, 2013 | 316,661 | ||||
Ending Balance, amount at Nov. 30, 2013 | $ 1,933,953 | 66,811 | (1,599,619) | 64,504 | 465,649 |
Net loss | (40,484) | 0 | (40,484) | ||
Other comprehensive loss | (29,659) | (29,659) | |||
Share based compensation and related share issuances, shares | 627 | ||||
Share based compensation and related share issuances, amount | $ 2,383 | 7,227 | 0 | 0 | 9,610 |
Ending Balance, shares at Nov. 30, 2014 | 317,288 | ||||
Ending Balance, amount at Nov. 30, 2014 | $ 1,936,336 | 74,038 | (1,640,103) | 34,845 | 405,116 |
Net loss | (31,952) | (31,952) | |||
Other comprehensive loss | (52,530) | (52,530) | |||
Share based compensation and related share issuances, shares | 622 | ||||
Share based compensation and related share issuances, amount | $ 1,926 | 6,736 | 8,662 | ||
Ending Balance, shares at Nov. 30, 2015 | 317,910 | ||||
Ending Balance, amount at Nov. 30, 2015 | $ 1,938,262 | $ 80,774 | $ (1,672,055) | $ (17,685) | $ 329,296 |
NOTE 1. THE COMPANY
NOTE 1. THE COMPANY | 12 Months Ended |
Nov. 30, 2015 | |
Accounting Policies [Abstract] | |
NOTE 1. THE COMPANY | NOVAGOLD RESOURCES INC. and its affiliates and subsidiaries (collectively, "NOVAGOLD" or the "Company") operates in the mining industry, focused on the exploration for and development of gold and copper mineral properties. The Company has no operations or realized revenues from its planned principal business purpose. The Company's principal assets include a 50% interest in the Donlin Gold project in Alaska, U.S.A. and a 50% interest in the Galore Creek project in British Columbia, Canada. The Company's primary focus is on the Donlin Gold project, which advanced to the permitting phase in 2012. The Donlin Gold project is owned and operated by Donlin Gold LLC, a limited liability company that is owned equally by wholly owned subsidiaries of NOVAGOLD and Barrick Gold Corporation ("Barrick"). The Company is currently exploring opportunities to sell, in whole or in part its interest in the Galore Creek Partnership. The Galore Creek project is owned by the Galore Creek Partnership a partnership in which a wholly owned subsidiary of NOVAGOLD, and Teck Resources Limited ("Teck") each own a 50% interest. |
NOTE 2. SUMMARY OF SIGNIFICANT
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Nov. 30, 2015 | |
Accounting Policies [Abstract] | |
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | Presentation These consolidated financial statements are presented in United States dollars and have been prepared in accordance with accounting principles generally accepted in the United States (US GAAP). References in these Consolidated Financial Statements and Notes to $ refer to United States currency and C$ to Canadian currency. Dollar amounts are in thousands, except for per share amounts. Use of estimates The preparation of the Company's Consolidated Financial Statements in accordance with US GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and the related disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. The more significant areas requiring the use of management estimates and assumptions related to: estimates of gold and copper production that are the basis for future cash flow estimates utilized in impairment calculations; estimates of fair value for asset impairments (including impairments of mineral properties and investments); valuation allowances for deferred tax assets; environmental, reclamation and closure obligations; reserves for contingencies and litigation; and the fair value and accounting treatment of financial instruments including marketable equity securities and derivative instruments. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Accordingly, actual results will differ from these amounts estimated in these financial statements. Principles of consolidation The Company's Consolidated Financial Statements include NOVAGOLD RESOURCES INC. and its wholly owned subsidiaries. The Company's wholly-owned subsidiaries include NOVAGOLD Canada Inc., Copper Canyon Resources Inc., NOVAGOLD U.S. Holdings Inc., NOVAGOLD Resources Alaska Inc., NOVAGOLD USA Inc., and AGC Resources Inc. All inter-company transactions and balances are eliminated on consolidation. The functional currency for the Company's Canadian operations is the Canadian dollar and the functional currency for the Company's U.S. operations is the U.S. dollar. Therefore, gains and losses on U.S. dollar denominated transactions and the effect of translating U.S. dollar denominated balances of Canadian operations are recorded in net loss. Cash and cash equivalents Cash and cash equivalents consists of cash balances and highly liquid investments with original maturities of three months or less are considered to be cash equivalents. Cash equivalents are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes. Restricted cash is excluded from cash and cash equivalents and is included in other long-term assets. Term deposits The Company's term deposits are recorded at cost. Term deposits are held at two Chartered Canadian banks with original maturities of 12 months or less. The term deposits are not traded in an active market. Investment in affiliates Investments in unconsolidated ventures over which the Company has the ability to exercise significant influence, but does not control, are accounted for under the equity method and include the Company's investments in the Donlin Gold and Galore Creek projects. The Company identified Donlin Gold LLC and the Galore Creek Partnership as Variable Interest Entities (VIEs) as these entities are dependent on funding from their owners. All funding, ownership, voting rights and power to exercise control is shared equally on a 50/50 basis between the owners of each VIE. Therefore, the Company has determined that it is not the primary beneficiary of either VIE. The Company's maximum exposure to loss is its investment in Donlin Gold LLC and Galore Creek Partnership. The equity method is a basis of accounting for investments whereby the investment is initially recorded at cost and the carrying value is adjusted thereafter to include the investor's pro rata share of post-acquisition earnings or losses of the investee, as computed by the consolidation method. Cash funding increases the carrying value of the investment. Profit distributions received or receivable from an investee reduce the carrying value of the investment. Donlin Gold LLC and the Galore Creek Partnership are non-publicly traded equity investees owning exploration and development projects. Therefore, the Company assesses whether there has been a potential impairment triggering event for other-than-temporary impairment by testing the underlying assets of the equity investee for recoverability and assessing whether there has been a change in the development plan or strategy for the project. If the Company determines that the underlying assets are recoverable and no other potential impairment conditions are identified, then the investment in the equity investee is carried at cost. If the underlying assets are not recoverable, the Company will record an impairment charge equal to the difference between the carrying amount of the investee and its fair value. Mineral properties Mineral property expenditures are expensed as incurred except for expenditures associated with the acquisition of mineral property assets through a business combination or asset acquisition. The Company reviews and evaluates its mineral properties for impairment when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. An impairment is considered to exist if the total estimated future cash flows on an undiscounted basis are less than the carrying amount of the assets. An impairment loss is measured and recorded based on discounted estimated future cash flows. Income taxes The Company accounts for income taxes using the liability method, recognizing certain temporary differences between the financial reporting basis of the Company's liabilities and assets and the related income tax basis for such liabilities and assets. This method generates either a net deferred income tax liability or asset for the Company, as measured by the statutory tax rates in effect. The Company derives its deferred income tax charge or benefit by recording the change in either the net deferred income tax liability or asset balance for the year. The Company's deferred income tax assets include certain future tax benefits. The Company records a valuation allowance against any portion of those deferred income tax assets when it believes, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred income tax asset will not be realized. Share-based payments The Company operates a stock option plan and a performance share unit (PSU) plan under which the Company receives services from employees as consideration for equity instruments (options or shares) of the Company. The Company records share-based compensation awards exchanged for employee services at fair value on the date of the grant and expenses the awards in the consolidated statement of loss over the requisite employee service period. Share-based compensation expense includes an estimate for forfeitures. The fair values of stock options are determined using a Black-Scholes option pricing model. The fair values of PSUs are determined using a Monte Carlo valuation model. The Company's estimates may be impacted by certain variables including, but not limited to, stock price volatility, employee stock option exercise behaviors, additional stock option grants, estimates of forfeitures, the Company's performance and the Company's performance in relation to its peers. The Company operates a deferred share unit (DSU) plan under which the Company receives services from its directors as consideration for equity instruments (shares) of the Company. Each DSU entitles the Company's directors to receive one common share of the Company when they retire from the Company. The fair value of the DSUs is measured at the date of the grant in amounts ranging from 50% to 100% of the directors' annual retainers at the election of the directors. The fair value is recognized in the consolidated statement of loss over the related service period. Net income (loss) per common share Basic and diluted income (loss) per share are presented for Net income (loss). Basic income (loss) per share is computed by dividing Net income (loss) by the weighted-average number of outstanding common shares for the period. Diluted income per share reflects the potential dilution that could occur if securities or other contracts that may require the issuance of common shares in the future were converted. Diluted income per share is computed by increasing the weighted-average number of outstanding common shares to include the additional common shares that would be outstanding after conversion and adjusting net income for changes that would result from the conversion. Only those securities or other contracts that result in a reduction in earnings per share are included in the calculation. Recently adopted accounting pronouncements Presentation of Financial Statements – Going Concern In August 2014, Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) guidance was issued that explicitly requires management to assess an entity's ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. The Company elected early adoption of the new standard applied prospectively. Application of the new guidance had no impact on the consolidated financial position, results of operations or cash flows. Discontinued Operations In April 2014, ASC guidance was issued related to Discontinued Operations which changed the criteria for determining which disposals can be presented as discontinued operations and modified related disclosure requirements. The updated guidance requires an entity to only classify dispositions as discontinued operations due to a major strategic shift or a major effect on an entity's operations in the financial statements. The updated guidance will also require additional disclosures relating to discontinued operations. The Company elected early adoption of the new standard. Application of the new guidance had no impact on the consolidated financial position, results of operations or cash flows. Foreign Currency Matters In March 2013, ASC guidance was issued related to Foreign Currency Matters to clarify the treatment of cumulative translation adjustments when a parent sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a business within a foreign entity. The updated guidance also resolves the diversity in practice for the treatment of business combinations achieved in stages in a foreign entity. Application of the new guidance had no impact on the consolidated financial position, results of operations or cash flows. Disclosures about Offsetting Assets and Liabilities In November 2011, ASC guidance was issued related to disclosures about offsetting assets and liabilities. The new guidance requires disclosures to allow investors to better compare financial statements prepared under US GAAP with financial statements prepared under International Financial Reporting Standards, as issued by the IASB (IFRS). In January 2013, an update was issued to further clarify that the disclosure requirements are limited to derivatives, repurchase agreements, and securities lending transactions to the extent that they are (i) offset in the financial statements or (ii) subject to an enforceable master netting arrangement or similar agreement. Application of the new guidance had no impact on the consolidated financial position, results of operations or cash flows. Consolidation – Amendments to the Consolidation Analysis In February 2015, ASC guidance was issued to amend current consolidation guidance. The amendments affect both the variable interest entity and voting interest entity consolidation models. The need to assess an entity under a different consolidation model may change previous consolidation conclusions. The new guidance is effective for the Company's fiscal year beginning December 1, 2016. The Company is currently evaluating this guidance. |
NOTE 3. SEGMENTED INFORMATION
NOTE 3. SEGMENTED INFORMATION | 12 Months Ended |
Nov. 30, 2015 | |
Segment Reporting [Abstract] | |
NOTE 3. SEGMENTED INFORMATION | Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Chief Executive Officer that makes strategic decisions. The Company has one operating segment in exploration and development of mineral properties. The Chief Executive Officer considers the business from a geographic perspective considering the performance of our investments in affiliates. Segment information is provided on each of the material projects individually in Note 5. |
NOTE 4. INVESTMENT IN DONLIN GO
NOTE 4. INVESTMENT IN DONLIN GOLD | 12 Months Ended |
Nov. 30, 2015 | |
Schedule of Investments [Abstract] | |
NOTE 4. INVESTMENT IN DONLIN GOLD | The Donlin Gold project is owned by Donlin Gold LLC, a limited liability company in which Barrick and the Company each own a 50% interest. Donlin Gold LLC has a board of four directors, with two directors selected by Barrick and two directors selected by the Company. All significant decisions related to Donlin Gold LLC require the approval of Barrick and the Company. Changes in the Company's investment in Donlin Gold LLC are summarized as follows: Years ended November 30, 2015 2014 2013 Balance – beginning of period $ 1,618 $ 1,720 $ 4,185 Share of losses Mineral property expenditures (10,845 ) (13,811 ) (14,412 ) Depreciation (171 ) (174 ) (208 ) (11,016 ) (13,985 ) (14,620 ) Funding 10,456 13,883 12,155 Balance – end of period $ 1,058 $ 1,618 $ 1,720 The following amounts represent the Company's 50% share of the assets and liabilities of Donlin Gold LLC. Donlin Gold LLC has capitalized as Mineral property the initial contribution of the Donlin Gold property with a carrying value of $64,000 resulting in a higher carrying value of the Mineral property than the Company. At November 30, 2015 2014 Current assets: Cash, prepaid expenses and other receivables $ 1,762 $ 2,294 Non-current assets: Property and equipment 232 403 Non-current assets: Mineral property 32,692 32,692 Current liabilities: Accounts payable and accrued liabilities (936 ) (1,079 ) Non-current liabilities: Reclamation obligation (692 ) (692 ) Net assets $ 33,058 $ 33,618 |
NOTE 5. INVESTMENT IN GALORE CR
NOTE 5. INVESTMENT IN GALORE CREEK | 12 Months Ended |
Nov. 30, 2015 | |
Investments in and Advances to Affiliates, Schedule of Investments [Abstract] | |
NOTE 5. INVESTMENT IN GALORE CREEK | The Galore Creek project is owned by the Galore Creek Partnership (GCP), a partnership in which Teck and the Company each own a 50% interest. GCP has a board of four directors, with two members selected by Teck and two members selected by the Company. All significant decisions related to GCP require the approval of Teck and the Company. GCP prepares its financial statements under International Financial Reporting Standards, as issued by the IASB and presents its financial statements in Canadian dollars. In accounting for its investment in GCP, the Company converts and presents reported amounts in accordance with US GAAP and in U.S. dollars. Changes in the Company's investment in GCP are summarized as follows: Years ended November 30, 2015 2014 2013 Balance – beginning of period $ 283,247 $ 305,735 $ 335,086 Share of losses Mineral property expenditures (147 ) (442 ) (4,580 ) Care and maintenance expense (884 ) (1,499 ) (2,444 ) Gain on sale of equipment 639 — — Depreciation — — (6,328 ) (392 ) (1,941 ) (13,352 ) Funding 508 2,063 6,638 Exploration tax credit 107 (693 ) (1,352 ) Foreign currency translation (40,564 ) (21,917 ) (21,285 ) Balance – end of period $ 242,906 $ 283,247 $ 305,735 The following amounts represent the Company's 50% share of the assets and liabilities of GCP presented in U.S. dollars and in accordance with U.S. GAAP. As a result of recording the Company's investment at fair value in June 2011, the carrying value of the Company's 50% interest in GCP is higher than 50% of the book value of GCP. Therefore, the Company's investment does not equal 50% of the net assets recorded by GCP: At November 30, 2015 2014 Current assets: Cash, prepaid expenses and other receivables $ 497 $ 386 Non-current assets: Mineral property 218,532 254,991 Current liabilities: Accounts payable and accrued liabilities (365 ) (360 ) Non-current liabilities: Payables and decommissioning liabilities (7,162 ) (8,268 ) Net assets $ 211,502 $ 246,749 |
NOTE 6. MINERAL PROPERTIES
NOTE 6. MINERAL PROPERTIES | 12 Months Ended |
Nov. 30, 2015 | |
Extractive Industries [Abstract] | |
NOTE 6. MINERAL PROPERTIES | In 2011, the Company acquired 40% of the Copper Canyon property in British Columbia, Canada adjacent to the Galore Creek project. The remaining 60% of the Copper Canyon property is owned by GCP. |
NOTE 7. OTHER ASSETS
NOTE 7. OTHER ASSETS | 12 Months Ended |
Nov. 30, 2015 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
7. OTHER ASSETS | At November 30, 2015 2014 Other current assets: Accounts and interest receivable $ 295 $ 137 Receivable from Galore Creek Partnership 28 32 Mineral exploration tax credit receivable 1,487 1,894 Note receivable 919 945 Prepaid expenses 581 727 $ 3,310 $ 3,735 Other long-term assets: Note receivable $ 939 $ 1,805 Marketable equity securities 571 901 Receivable from Galore Creek Partnership 3,546 4,139 Restricted cash – reclamation deposit 1,117 1,304 Office equipment 90 130 $ 6,263 $ 8,279 |
NOTE 8. CONVERTIBLE NOTES
NOTE 8. CONVERTIBLE NOTES | 12 Months Ended |
Nov. 30, 2015 | |
Debt Disclosure [Abstract] | |
NOTE 8. CONVERTIBLE NOTES | On March 26, 2008, the Company issued $95,000 in 5.5% unsecured senior convertible notes ("Notes") maturing on May 1, 2015, for net proceeds of $92,200. Interest was payable semi-annually in arrears on May 1 and November 1 of each year, beginning November 1, 2008. On conversion, at the Company's election, holders of the Notes would receive cash or a combination of cash and shares. On May 2, 2013, the Company purchased $72,821 of the principal amount of its Notes, pursuant to the terms and indenture governing the Notes which provided Holders the opportunity to require the Company to purchase for cash, all or a portion of their Notes (the "Put Option") on May 1, 2013. On September 16, 2013, the Company accepted Holders' offers to purchase another $6,350 of the principal amount of the Notes. The remaining $15,829 principal amount of the Notes was repaid on May 1, 2015. As the conversion price of the Notes was denominated in U.S. dollars, a currency different from the functional currency of the Company, the conversion feature was an embedded derivative and separately recognized as a liability. This embedded derivative was recorded at fair value and re-measured each period with the movement being recorded as a gain or loss in Net loss. The fair value of the embedded derivative prior to the expiry of the Put Option was composed of the conversion feature of the Note and the Put Option. Subsequent to this date, until settlement at maturity, the measurement of the embedded derivative was based solely on the conversion feature. As a result of the measurement of the embedded derivatives and the initial discount, the recorded liability to repay the Notes was lower than its face value. The effective Note discount, was charged to interest expense and accreted to the liability over the term of the Notes. Changes in the carrying values of the Notes are summarized as follows: Years ended November 30, 2015 2014 2013 Balance – beginning of period $ 15,112 $ 13,570 $ 73,606 Accretion expense 717 1,542 5,101 Repayment or repurchases of Notes (15,829 ) — (65,137 ) Balance – end of period $ — $ 15,112 $ 13,570 |
NOTE 9. PROMISSORY NOTE
NOTE 9. PROMISSORY NOTE | 12 Months Ended |
Nov. 30, 2015 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
NOTE 9. PROMISSORY NOTE | The Company has a promissory note payable to Barrick for $51,576, plus interest at a rate of U.S. prime plus 2%, amounting to $28,685 in accrued interest. The promissory note resulted from the agreement that led to the formation of Donlin Gold LLC, where the Company agreed to reimburse Barrick for a portion of their expenditures incurred from April 1, 2006 to November 30, 2007. The promissory note and accrued interest are payable from 85% of the Company's share of revenue from future mine production or from any net proceeds resulting from a reduction of the Company's interest in Donlin Gold LLC. The carrying value of the promissory note approximates fair value. |
NOTE 10. FAIR VALUE ACCOUNTING
NOTE 10. FAIR VALUE ACCOUNTING | 12 Months Ended |
Nov. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
NOTE 10. FAIR VALUE ACCOUNTING | Financial instruments measured at fair value are classified into one of three levels in the fair value hierarchy according to the significance of the inputs used in making the measurement. The three levels of the fair value hierarchy are as follows: Level 1 Level 2 Level 3 Fair value at November 30, 2015 Total Level 1 Level 2 Level 3 Assets: Marketable equity securities $ 571 $ 571 $ — $ — Fair value at November 30, 2014 Total Level 1 Level 2 Level 3 Assets: Marketable equity securities $ 901 $ 901 $ — $ — The Company's marketable equity securities are valued using quoted market prices in active markets and as such are classified within Level 1 of the fair value hierarchy. The fair value of the marketable equity securities is calculated as the quoted market price of the marketable equity security multiplied by the quantity of shares held by the Company. |
NOTE 11. GENERAL AND ADMINISTRA
NOTE 11. GENERAL AND ADMINISTRATIVE EXPENSES | 12 Months Ended |
Nov. 30, 2015 | |
Other Income and Expenses [Abstract] | |
NOTE 11. GENERAL AND ADMINISTRATIVE EXPENSES | Years ended November 30, 2015 2014 2013 Salaries $ 6,164 $ 6,022 $ 6,067 Share-based compensation (note 15) 9,488 10,197 12,304 Office expense 2,090 2,626 4,462 Professional fees 693 1,806 2,889 Corporate communications and regulatory 1,452 1,395 1,269 $ 19,887 $ 22,046 $ 26,991 |
NOTE 12. WRITE-DOWN OF ASSETS
NOTE 12. WRITE-DOWN OF ASSETS | 12 Months Ended |
Nov. 30, 2015 | |
Asset Impairment Charges [Abstract] | |
NOTE 12. WRITE-DOWN OF ASSETS | In 2013, the Company recorded write-downs at its San Roque project in Argentina including $514 related to mineral property and $262 for other assets. |
NOTE 13. OTHER INCOME (EXPENSE)
NOTE 13. OTHER INCOME (EXPENSE) | 12 Months Ended |
Nov. 30, 2015 | |
Other Income and Expenses [Abstract] | |
NOTE 13. OTHER INCOME (EXPENSE) | Years ended November 30, 2015 2014 2013 Interest income $ 740 $ 854 $ 942 Interest expense (5,188 ) (6,838 ) (12,607 ) Foreign exchange gain 4,771 3,688 10,448 Write-down of investments (426 ) — (3,227 ) Gain on derivative liabilities — 83 1,356 $ (103 ) $ (2,213 ) $ (3,088 ) During 2015, the Company recognized impairments for other-than-temporary declines in value of $426 for marketable equity securities. During 2013, the Company recognized impairments for other-than-temporary declines in value of $2,738 for marketable equity securities and to write-off $489 of other investments, at cost. At November 30, 2015 all unrealized losses were in a continuous loss position for less than 12 months. |
NOTE 14. INCOME TAXES
NOTE 14. INCOME TAXES | 12 Months Ended |
Nov. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
NOTE 14. INCOME TAXES | The Company's Income tax expense consisted of: Years ended November 30, 2015 2014 2013 Current: Canada $ — $ — $ — Foreign 155 189 290 155 189 290 Deferred: Canada (2 ) 74 3,606 Foreign — — — (2 ) 74 3,606 Income tax expense $ 153 $ 263 $ 3,896 The Company's Loss before income tax consisted of: Years ended November 30, 2015 2014 2013 Canada $ (14,775 ) $ (20,372 ) $ (42,077 ) Foreign (17,024 ) (19,849 ) (16,787 ) $ (31,799 ) $ (40,221 ) $ (58,864 ) Effective April 1, 2013 the British Columbia provincial corporate tax rate increased from 10% to 11%. The Company's Income tax expense differed from the amounts computed by applying the Canadian statutory corporate income tax rates for the following reasons: Years ended November 30, 2015 2014 2013 Loss before income taxes (31,799 ) $ (40,221 ) $ (58,864 ) Combined federal and provincial statutory tax rate 26.00 % 26.00 % 25.67 % Income tax recovery based on statutory income tax rates (8,268 ) (10,457 ) (15,110 ) Increase (decrease) attributable to: (Non-deductible) taxable expenditures 3,175 3,339 2,913 Non-taxable unrealized gain (loss) on derivative financial instruments — — 615 Effect of different statutory tax rates on earnings of subsidiaries (2,619 ) (3,027 ) (2,773 ) Effect of statutory rate change — — (1,916 ) Effect of tax losses expired 3,878 1,424 — Change in valuation allowance 4,480 9,357 20,248 Other (493 ) (373 ) (81 ) Income tax expense $ 153 $ 263 $ 3,896 Components of the Company's deferred income tax assets (liabilities) are as follows: At November 30, 2015 2014 Deferred tax income assets: Asset retirement obligation $ 186 $ 257 Net operating loss carry forwards 212,619 214,594 Capital loss carry forwards 31,561 37,002 Mineral properties 16,596 19,524 Property and equipment 198 354 Investment in affiliates 43,315 42,343 Share issuance costs 776 1,327 Unpaid interest expense 4,458 4,458 Investment tax credit 2,938 3,429 Other 2,339 2,550 314,986 325,838 Valuation allowances (276,521 ) (281,071 ) 38,465 44,767 Deferred income tax liabilities: Investment in affiliates (36,133 ) (42,176 ) Mineral properties (11,315 ) (13,208 ) Capitalized assets & other (1,052 ) (1,102 ) Unrealized gain on investments — (5 ) Investment tax credit (764 ) (882 ) (49,264 ) (57,373 ) Net deferred income tax liabilities $ (10,799 ) $ (12,606 ) Net deferred income tax asset, as presented in the balance sheet $ 9,711 $ 11,445 Net deferred income tax liability, as presented in the balance sheet $ (20,510 ) $ (24,051 ) Net operating losses available to offset future taxable income are as follows: Year of Expiry U.S. Canada 2024 $ 1,032 $ — 2025 1,246 — 2026 13,382 24,498 2027 18,493 3,935 2028 85 519 2029 11,223 12,238 2030 10,916 17,607 2031 16,580 16,519 2032 306,333 28,940 2033 14,529 21,642 2034 15,606 10,021 2035 16,833 7,605 $ 426,258 $ 143,524 Future use of U.S. loss carry-forwards is subject to certain limitations under provisions of the Internal Revenue Code including limitations subject to Section 382, which relates to a 50% change in control over a three-year period, and are further dependent upon the Company attaining profitable operations. Ownership changes occurred on January 22, 2009 and on December 31, 2012 and the U.S. tax losses related to NOVAGOLD Resources Alaska Inc. and its investment in Donlin Gold LLC for the prior three year periods prior to the change in control may be subject to limitation under Section 382. Accordingly, the Company's ability to use these losses may be limited or they may expire un-utilized. Losses incurred to date may be further limited if a subsequent change in control occurs. Uncertain tax position There were no unrecognized tax benefits at November 30, 2015, 2014 and 2013. The Company recognizes any interest and penalties related to uncertain tax positions, if any, as income tax expense. At November 30, 2015, 2014 and 2013, there were no interest and penalties related to uncertain tax positions. The Company is subject to income taxes in Canada and the United States. The Company is currently under audit by the Canada Revenue Agency regarding transactions undertaken by one of the Company's Canadian subsidiaries. The Company is currently under audit by the Internal Revenue Service regarding one of its U.S. subsidiaries. With few exceptions, the tax years that remain subject to examination as of November 30, 2015 are 2008 to 2015 in Canada and 1998 to 2015 in the United States. The Company has recognized $9,711 (2014: $11,445, 2013: $9,728) of deferred tax assets that are dependent on the reversal of existing taxable temporary differences. The Company has suffered a loss in the current and prior period in the tax jurisdictions to which the deferred tax assets relate. The Company has undertaken a tax planning strategy in the current and prior period to merge Canadian entities when required to access the deferred tax assets to offset future increases in taxable income of the Canadian entities. Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to use the existing deferred tax asset. Significant pieces of objective negative evidence evaluated included the cumulative loss incurred as at November 30, 2015 and the decline in metal prices. Such objective evidence limits the ability to consider other subjective evidence such as managements' projections for future growth. On the basis of this evaluation, as of November 30, 2015, a valuation allowance of $276,521 (2014: $281,071, 2013: $276,630) inclusive of valuation allowance for investment tax credits has been recorded in order to measure only the portion of the deferred tax asset that more likely than not will be realized. The amount of the deferred tax asset considered realizable; however, could be adjusted if estimates of future taxable income during the carry forward period are reduced or if objective negative evidence in the form of cumulative losses is no longer present and additional weight may be given to subjective evidence such as management's projections for growth. |
NOTE 15. SHARE-BASED COMPENSATI
NOTE 15. SHARE-BASED COMPENSATION | 12 Months Ended |
Nov. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
NOTE 15. SHARE-BASED COMPENSATION | Share incentive awards include a stock option plan for directors, executives and eligible employees, a PSU plan for executives and eligible employees and a DSU plan for directors of the Company. Options granted to purchase common shares have exercise prices not less than the fair market value of the underlying share at the date of grant. At November 30, 2015, 23.2 million common shares were available for future share incentive plan awards. The Company recognized share-based compensation as follows: Years ended November 30, 2015 2014 2013 Stock options $ 4,736 $ 6,062 $ 8,135 Performance share unit plan 4,537 3,944 3,935 Deferred share unit plan 215 191 234 $ 9,488 $ 10,197 $ 12,304 At November 30, 2015, the non-vested stock option and PSU expense not recognized was $2,653 (2014: $3,877) to be recognized over the next two years. Stock options Stock options granted under the Company's share-based incentive plans vest over periods of two years and are exercisable over a period of time not to exceed five years from the grant date. The value of each option award is estimated at the grant date using the Black-Scholes option pricing model. The Black-Scholes option pricing model requires the input of subjective assumptions, including the expected term of the option award and share price volatility. The expected term of options granted is derived from historical data on employee exercise and post-vesting employment termination experience. Expected volatility is based on the historical volatility of the Company's shares at the grant date. These estimates involve inherent uncertainties and the application of management's judgment. In addition, we are required to estimate the expected forfeiture rate and only recognize expense for those options expected to vest. As a result, if other assumptions had been used, our recorded share-based compensation expense would have been different from that reported. The Black-Scholes option pricing models used the following weighted-average assumptions: Years ended November 30, 2015 2014 2013 Share price (C$) 3.18 2.90 4.40 Average risk-free interest rate 1.06% 1.18% 1.07% Exercise price (C$) 3.18 2.90 4.40 Expected life (years) 3 3 3 Expected volatility 60% 60% 56% Expected dividends Nil Nil Nil Fair value per share of options granted (C$) 1.28 1.18 1.72 The following table summarizes annual activity for all stock options for each of the three years ended November 30: 2015 2014 2013 Number of shares (thousands) Weighted average exercise price (C$) Number of shares (thousands) Weighted average exercise price (C$) Number of shares (thousands) Weighted average exercise price (C$) Outstanding at beginning of year 15,219 5.47 15,223 6.54 13,903 7.08 Granted 4,360 3.18 6,109 2.90 3,218 4.40 Exercised (393) 3.46 (1,285) 2.24 (121) 2.23 Forfeited and expired (1,336) 7.38 (4,828) 6.45 (1,777) 7.22 Outstanding at end of year 17,850 4.81 15,219 5.47 15,223 6.54 Exercisable at year-end 14,092 11,644 12,715 At November 30, 2015, there were 3,758,000 (2014: 3,575,000) unvested options outstanding with a weighted average exercise price of C$3.07 (2014: C$3.15). During the year ended November 30, 2015, 4,177,000 (2014: 4,636,000) options vested. The following table summarizes information about stock options outstanding and exercisable at November 30, 2015: Stock options - issued and outstanding Stock options - exercisable Range of price (C$) Number of outstanding options (thousands) Weighted average years to expiry Weighted average exercise price (C$) Number of exercisable options (thousands) Weighted average exercise price (C$) 2.90 to 3.99 10,168 3.48 3.02 6,411 2.99 4.00 to 5.99 4,138 1.93 4.59 4,138 4.59 6.00 to 7.99 800 1.45 6.36 800 6.36 10.00 to 11.99 1,712 0.96 10.24 1,711 10.24 12.00 to 13.99 932 0.12 13.02 932 13.02 14.00 to 14.82 100 1.50 14.82 100 14.82 17,850 2.60 4.81 14,092 5.28 Performance share units The Company has a PSU plan that provides for the issuance of PSUs in amounts as approved by the Company's Compensation Committee. Each PSU entitles the participant to receive a common share of the Company at the end of a specified period. The Compensation Committee may adjust the number of common shares for the achievement of certain performance and vesting criteria. The actual performance against each of these criteria generates a multiplier that varies from 0% to 150%. Thus, the common shares that may be issued vary between 0% and 150% of the number of PSUs granted, as reduced by the amounts for participants no longer with the Company on vesting date. For the year ended November 30, 2015, the PSUs vested with a multiplier of 137% (2014: 85%; 2013: 70%). The value of each PSU granted is estimated at the grant date using a Monte Carlo simulation model. The Monte Carlo simulation model requires the input of subjective assumptions, including the share price volatility of the Company's stock, as well as comparator group companies and the correlation of returns between the comparator companies and the Company. Expected volatility is based on the historical volatility of the Company's shares and the comparator group companies shares at the grant date. These estimates involve inherent uncertainties and the application of management's judgment. As a result, if other assumptions had been used, our recorded share-based compensation expense would have been different from that reported. For the year ended November 30, 2015, the estimated fair value per share of PSUs granted was C$3.86 (2014: C$3.18; 2013: C$4.58). The following table summarizes annual information about the number of PSUs outstanding: Years ended November 30, 2015 2014 2013 Outstanding at beginning of year 2,422,150 1,268,450 805,300 Granted 1,377,250 1,819,700 706,150 Vested (846,180) (546,380) (167,735) Performance adjustment 228,530 (96,420) (72,765) Forfeited — (23,200) (2,500) Outstanding at end of year 3,181,750 2,422,150 1,268,450 The PSUs outstanding at November 30, 2015 are scheduled to vest over the next two years. For the year ended November 30, 2015, the Company recognized a share-based compensation charge against income of $4,537 (2014: $3,944; 2013: $3,935) for PSUs. Under the PSU plan, the Company issued 506,175 common shares in 2015 (2014: 329,645; 2013: 96,467). The difference between the PSUs vested and the common shares issued were settled in cash to cover employee withholding taxes. Deferred share units The Company has a DSU plan that provides for the issuance of DSUs in amounts where the Directors receive half of their annual retainer in DSUs and have the option to elect to receive all or a portion of the other half of their annual retainer in DSUs. Each DSU entitles the Directors to receive one common share when they retire from the Company. For the year ended November 30, 2015, the Company recognized a share-based payment charge against income of $215 (2014: $191; 2013: $234) for the DSUs granted to Directors during the year. Under the DSU plan, the Company issued nil common shares in 2015 and 2014, and 7,750 common shares in 2013. The common shares were issued at the date of the DSU vesting and the valuation was deemed to be the opening TSX common share price on the vesting date. |
NOTE 16. SHARE CAPITAL
NOTE 16. SHARE CAPITAL | 12 Months Ended |
Nov. 30, 2015 | |
Stockholders' Equity Note [Abstract] | |
NOTE 16. SHARE CAPITAL | Common shares The Company is authorized to issue 1,000,000,000 common shares without par value, of which 317,910,000 were issued and outstanding as of November 30, 2015 and 317,288,000 were issued and outstanding as of November 30, 2014. Preferred shares Pursuant to the Company's Notice of Articles filed under the Business Corporations Act (British Columbia), the Company is authorized to issue 10,000,000 preferred shares without par value. The authorized but unissued preferred shares may be issued in designated series from time to time by one or more resolutions adopted by the Directors. The Directors have the authority to determine the preferences, limitations and relative rights of each series of preferred shares. At November 30, 2015 and 2014, no preferred shares were issued or outstanding. |
NOTE 17. RECLASSIFICATIONS OUT
NOTE 17. RECLASSIFICATIONS OUT OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | 12 Months Ended |
Nov. 30, 2015 | |
EQUITY | |
NOTE 17. RECLASSIFICATIONS OUT OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) | Unrealized gain (loss) on marketable securities, net Foreign currency translation adjustments Total November 30, 2014 $ (104 ) $ 34,949 $ 34,845 Change in other comprehensive income (loss) before reclassifications (227 ) (52,729 ) (52,956 ) Reclassifications from accumulated other comprehensive income (loss) 426 — 426 Net current-period other comprehensive income (loss) 199 (52,729 ) (52,530 ) November 30, 2015 $ 95 $ (17,780 ) $ (17,685 ) Details about accumulated other comprehensive income (loss) components: Amount reclassified from accumulated other comprehensive income (loss) 2015 2014 2013 Marketable equity securities adjustments Impairment of marketable equity securities (1) $ 426 $ — $ 2,738 Tax benefit (expense) — — — Net of tax $ 426 $ — $ 2,738 (1) |
NOTE 18. CHANGE IN OPERATING AS
NOTE 18. CHANGE IN OPERATING ASSETS AND LIABILITIES | 12 Months Ended |
Nov. 30, 2015 | |
Increase (Decrease) in Operating Capital [Abstract] | |
NOTE 18. CHANGE IN OPERATING ASSETS AND LIABILITIES | Years ended November 30, 2015 2014 2013 Decrease (increase) in receivables and other assets $ 908 $ 3,319 $ (89 ) Increase (decrease) in accounts payable and accrued liabilities (275 ) 56 (1,231 ) Decrease in other liabilities (174 ) (202 ) (268 ) $ 459 $ 3,173 $ (1,588 ) |
NOTE 19. RELATED PARTY TRANSACT
NOTE 19. RELATED PARTY TRANSACTIONS | 12 Months Ended |
Nov. 30, 2015 | |
Related Party Transactions [Abstract] | |
NOTE 19. RELATED PARTY TRANSACTIONS | The Company provided management services to Donlin Gold LLC for $nil in 2015, $235 in 2014 and $258 in 2013; office rental and services to Galore Creek Partnership for $349 in 2015, $398 in 2014 and $423 in 2013; and management and office administration services to NovaCopper Inc. for $nil in 2015 and 2014, and $168 in 2013. As of November 30, 2015, the Company has accounts receivable from Galore Creek Partnership of $28 (2014: $32) included in other current assets and $3,546 (2014: $4,139) included in other long-term assets. |
NOTE 20. COMMITMENTS AND CONTIN
NOTE 20. COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Nov. 30, 2015 | |
Commitments and Contingencies Disclosure [Abstract] | |
NOTE 20. COMMITMENTS AND CONTINGENCIES | General The Company follows ASC guidance in determining its accruals and disclosures with respect to loss contingencies. Accordingly, estimated losses from loss contingencies are accrued by a charge to income when information available prior to issuance of the financial statements indicates that it is probable that a liability could be incurred and the amount of the loss can be reasonably estimated. Legal expenses associated with the contingency are expensed as incurred. If a loss contingency is not probable or reasonably estimable, disclosure of the loss contingency is made in the financial statements when it is at least reasonably possible that a material loss could be incurred. Obligations under operating leases The Company leases certain assets, such as office equipment and office facilities, under operating leases expiring at various dates through 2018. Future minimum annual lease payments are $385 in 2016, $336 in 2017, $41in 2018, totaling $762. |
NOTE 21. SUPPLEMENTAL CASH FLOW
NOTE 21. SUPPLEMENTAL CASH FLOW INFORMATION | 12 Months Ended |
Nov. 30, 2015 | |
Supplemental Cash Flow Elements [Abstract] | |
NOTE 21. SUPPLEMENTAL CASH FLOW INFORMATION | Years ended November 30, 2015 2014 2013 Interest received $ 639 $ 643 $ 630 Interest paid $ 435 $ 870 $ 3,164 Income taxes paid $ 120 $ 432 $ — |
NOTE 22. UNAUDITED SUPPLEMENTAR
NOTE 22. UNAUDITED SUPPLEMENTARY DATA | 12 Months Ended |
Nov. 30, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
NOTE 22. UNAUDITED SUPPLEMENTARY DATA | Quarterly data The following is a summary of selected quarterly financial information (unaudited): 2015 Q1 Q2 Q3 Q4 Operating loss $ (11,286 ) $ (7,246 ) $ (6,579 ) $ (6,585 ) Net loss $ (9,299 ) $ (9,184 ) $ (6,301 ) $ (7,168 ) Loss per common share, basic and diluted $ (0.03 ) $ (0.03 ) $ (0.02 ) $ (0.02 ) 2014 Q1 Q2 Q3 Q4 Operating loss $ (11,333 ) $ (8,264 ) $ (10,755 ) $ (7,656 ) Net loss $ (10,691 ) $ (10,681 ) $ (12,009 ) $ (7,103 ) Loss per common share, basic and diluted $ (0.03 ) $ (0.03 ) $ (0.04 ) $ (0.02 ) Significant after-tax items were as follows: Fourth quarter 2015: n/a Third quarter 2015: n/a Second quarter 2015: n/a First quarter 2015: Foreign exchange gain $3,463 ($0.01 per share, basic and diluted). Fourth quarter 2014: n/a Third quarter 2014: n/a Second quarter 2014: n/a First quarter 2014: Foreign exchange gain $2,449 ($0.01 per share, basic and diluted). |
NOTE 2. SUMMARY OF SIGNIFICAN29
NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Nov. 30, 2015 | |
Accounting Policies [Abstract] | |
Presentation | These consolidated financial statements are presented in United States dollars and have been prepared in accordance with accounting principles generally accepted in the United States (US GAAP). References in these Consolidated Financial Statements and Notes to $ refer to United States currency and C$ to Canadian currency. Dollar amounts are in thousands, except for per share amounts. |
Use of estimates | The preparation of the Company's Consolidated Financial Statements in accordance with US GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and the related disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. The more significant areas requiring the use of management estimates and assumptions related to: estimates of gold and copper production that are the basis for future cash flow estimates utilized in impairment calculations; estimates of fair value for asset impairments (including impairments of mineral properties and investments); valuation allowances for deferred tax assets; environmental, reclamation and closure obligations; reserves for contingencies and litigation; and the fair value and accounting treatment of financial instruments including marketable equity securities and derivative instruments. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Accordingly, actual results will differ from these amounts estimated in these financial statements. |
Principles of consolidation | The Company's Consolidated Financial Statements include NOVAGOLD RESOURCES INC. and its wholly owned subsidiaries. The Company's wholly-owned subsidiaries include NOVAGOLD Canada Inc., Copper Canyon Resources Inc., NOVAGOLD U.S. Holdings Inc., NOVAGOLD Resources Alaska Inc., NOVAGOLD USA Inc., and AGC Resources Inc. All inter-company transactions and balances are eliminated on consolidation. The functional currency for the Company's Canadian operations is the Canadian dollar and the functional currency for the Company's U.S. operations is the U.S. dollar. Therefore, gains and losses on U.S. dollar denominated transactions and the effect of translating U.S. dollar denominated balances of Canadian operations are recorded in net loss. |
Cash and cash equivalents | Cash and cash equivalents consists of cash balances and highly liquid investments with original maturities of three months or less are considered to be cash equivalents. Cash equivalents are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes. Restricted cash is excluded from cash and cash equivalents and is included in other long-term assets. |
Term Deposits | The Company's term deposits are recorded at cost. Term deposits are held at two Chartered Canadian banks with original maturities of 12 months or less. The term deposits are not traded in an active market. |
Investment in affiliates | Investments in unconsolidated ventures over which the Company has the ability to exercise significant influence, but does not control, are accounted for under the equity method and include the Company's investments in the Donlin Gold and Galore Creek projects. The Company identified Donlin Gold LLC and the Galore Creek Partnership as Variable Interest Entities (VIEs) as these entities are dependent on funding from their owners. All funding, ownership, voting rights and power to exercise control is shared equally on a 50/50 basis between the owners of each VIE. Therefore, the Company has determined that it is not the primary beneficiary of either VIE. The Company's maximum exposure to loss is its investment in Donlin Gold LLC and Galore Creek Partnership. The equity method is a basis of accounting for investments whereby the investment is initially recorded at cost and the carrying value is adjusted thereafter to include the investor's pro rata share of post-acquisition earnings or losses of the investee, as computed by the consolidation method. Cash funding increases the carrying value of the investment. Profit distributions received or receivable from an investee reduce the carrying value of the investment. Donlin Gold LLC and the Galore Creek Partnership are non-publicly traded equity investees owning exploration and development projects. Therefore, the Company assesses whether there has been a potential impairment triggering event for other-than-temporary impairment by testing the underlying assets of the equity investee for recoverability and assessing whether there has been a change in the development plan or strategy for the project. If the Company determines that the underlying assets are recoverable and no other potential impairment conditions are identified, then the investment in the equity investee is carried at cost. If the underlying assets are not recoverable, the Company will record an impairment charge equal to the difference between the carrying amount of the investee and its fair value. |
Mineral properties | Mineral property expenditures are expensed as incurred except for expenditures associated with the acquisition of mineral property assets through a business combination or asset acquisition. The Company reviews and evaluates its mineral properties for impairment when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. An impairment is considered to exist if the total estimated future cash flows on an undiscounted basis are less than the carrying amount of the assets. An impairment loss is measured and recorded based on discounted estimated future cash flows. |
Income Taxes | The Company accounts for income taxes using the liability method, recognizing certain temporary differences between the financial reporting basis of the Company's liabilities and assets and the related income tax basis for such liabilities and assets. This method generates either a net deferred income tax liability or asset for the Company, as measured by the statutory tax rates in effect. The Company derives its deferred income tax charge or benefit by recording the change in either the net deferred income tax liability or asset balance for the year. The Company's deferred income tax assets include certain future tax benefits. The Company records a valuation allowance against any portion of those deferred income tax assets when it believes, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred income tax asset will not be realized. |
Share-based payments | The Company operates a stock option plan and a performance share unit (PSU) plan under which the Company receives services from employees as consideration for equity instruments (options or shares) of the Company. The Company records share-based compensation awards exchanged for employee services at fair value on the date of the grant and expenses the awards in the consolidated statement of loss over the requisite employee service period. Share-based compensation expense includes an estimate for forfeitures. The fair values of stock options are determined using a Black-Scholes option pricing model. The fair values of PSUs are determined using a Monte Carlo valuation model. The Company's estimates may be impacted by certain variables including, but not limited to, stock price volatility, employee stock option exercise behaviors, additional stock option grants, estimates of forfeitures, the Company's performance and the Company's performance in relation to its peers. The Company operates a deferred share unit (DSU) plan under which the Company receives services from its directors as consideration for equity instruments (shares) of the Company. Each DSU entitles the Company's directors to receive one common share of the Company when they retire from the Company. The fair value of the DSUs is measured at the date of the grant in amounts ranging from 50% to 100% of the directors' annual retainers at the election of the directors. The fair value is recognized in the consolidated statement of loss over the related service period. |
Net income (loss) per common share | Basic and diluted income (loss) per share are presented for Net income (loss). Basic income (loss) per share is computed by dividing Net income (loss) by the weighted-average number of outstanding common shares for the period. Diluted income per share reflects the potential dilution that could occur if securities or other contracts that may require the issuance of common shares in the future were converted. Diluted income per share is computed by increasing the weighted-average number of outstanding common shares to include the additional common shares that would be outstanding after conversion and adjusting net income for changes that would result from the conversion. Only those securities or other contracts that result in a reduction in earnings per share are included in the calculation. |
Recently adopted accounting pronouncements | Presentation of Financial Statements – Going Concern In August 2014, Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) guidance was issued that explicitly requires management to assess an entity's ability to continue as a going concern, and to provide related footnote disclosures in certain circumstances. The Company elected early adoption of the new standard applied prospectively. Application of the new guidance had no impact on the consolidated financial position, results of operations or cash flows. Discontinued Operations In April 2014, ASC guidance was issued related to Discontinued Operations which changed the criteria for determining which disposals can be presented as discontinued operations and modified related disclosure requirements. The updated guidance requires an entity to only classify dispositions as discontinued operations due to a major strategic shift or a major effect on an entity's operations in the financial statements. The updated guidance will also require additional disclosures relating to discontinued operations. The Company elected early adoption of the new standard. Application of the new guidance had no impact on the consolidated financial position, results of operations or cash flows. Foreign Currency Matters In March 2013, ASC guidance was issued related to Foreign Currency Matters to clarify the treatment of cumulative translation adjustments when a parent sells a part or all of its investment in a foreign entity or no longer holds a controlling financial interest in a subsidiary or group of assets that is a business within a foreign entity. The updated guidance also resolves the diversity in practice for the treatment of business combinations achieved in stages in a foreign entity. Application of the new guidance had no impact on the consolidated financial position, results of operations or cash flows. Disclosures about Offsetting Assets and Liabilities In November 2011, ASC guidance was issued related to disclosures about offsetting assets and liabilities. The new guidance requires disclosures to allow investors to better compare financial statements prepared under US GAAP with financial statements prepared under International Financial Reporting Standards, as issued by the IASB (IFRS). In January 2013, an update was issued to further clarify that the disclosure requirements are limited to derivatives, repurchase agreements, and securities lending transactions to the extent that they are (i) offset in the financial statements or (ii) subject to an enforceable master netting arrangement or similar agreement. Application of the new guidance had no impact on the consolidated financial position, results of operations or cash flows. Consolidation – Amendments to the Consolidation Analysis In February 2015, ASC guidance was issued to amend current consolidation guidance. The amendments affect both the variable interest entity and voting interest entity consolidation models. The need to assess an entity under a different consolidation model may change previous consolidation conclusions. The new guidance is effective for the Company's fiscal year beginning December 1, 2016. The Company is currently evaluating this guidance. |
NOTE 4. INVESTMENT IN DONLIN 30
NOTE 4. INVESTMENT IN DONLIN GOLD (Tables) - Donlin Gold LLC, Alaska, USA | 12 Months Ended |
Nov. 30, 2015 | |
Changes in the Company's investment | Years ended November 30, 2015 2014 2013 Balance – beginning of period $ 1,618 $ 1,720 $ 4,185 Share of losses Mineral property expenditures (10,845 ) (13,811 ) (14,412 ) Depreciation (171 ) (174 ) (208 ) (11,016 ) (13,985 ) (14,620 ) Funding 10,456 13,883 12,155 Balance – end of period $ 1,058 $ 1,618 $ 1,720 |
Net assets | At November 30, 2015 2014 Current assets: Cash, prepaid expenses and other receivables $ 1,762 $ 2,294 Non-current assets: Property and equipment 232 403 Non-current assets: Mineral property 32,692 32,692 Current liabilities: Accounts payable and accrued liabilities (936 ) (1,079 ) Non-current liabilities: Reclamation obligation (692 ) (692 ) Net assets $ 33,058 $ 33,618 |
NOTE 5. INVESTMENT IN GALORE 31
NOTE 5. INVESTMENT IN GALORE CREEK (Tables) - The Galore Creek Partnership, British Columbia, Canada | 12 Months Ended |
Nov. 30, 2015 | |
Changes in the Company's investment | Years ended November 30, 2015 2014 2013 Balance – beginning of period $ 283,247 $ 305,735 $ 335,086 Share of losses Mineral property expenditures (147 ) (442 ) (4,580 ) Care and maintenance expense (884 ) (1,499 ) (2,444 ) Gain on sale of equipment 639 — — Depreciation — — (6,328 ) (392 ) (1,941 ) (13,352 ) Funding 508 2,063 6,638 Exploration tax credit 107 (693 ) (1,352 ) Foreign currency translation (40,564 ) (21,917 ) (21,285 ) Balance – end of period $ 242,906 $ 283,247 $ 305,735 |
Net assets | At November 30, 2015 2014 Current assets: Cash, prepaid expenses and other receivables $ 497 $ 386 Non-current assets: Mineral property 218,532 254,991 Current liabilities: Accounts payable and accrued liabilities (365 ) (360 ) Non-current liabilities: Payables and decommissioning liabilities (7,162 ) (8,268 ) Net assets $ 211,502 $ 246,749 |
NOTE 7. OTHER ASSETS (Tables)
NOTE 7. OTHER ASSETS (Tables) | 12 Months Ended |
Nov. 30, 2015 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Summary of other assets | At November 30, 2015 2014 Other current assets: Accounts and interest receivable $ 295 $ 137 Receivable from Galore Creek Partnership 28 32 Mineral exploration tax credit receivable 1,487 1,894 Note receivable 919 945 Prepaid expenses 581 727 $ 3,310 $ 3,735 Other long-term assets: Note receivable $ 939 $ 1,805 Marketable equity securities 571 901 Receivable from Galore Creek Partnership 3,546 4,139 Restricted cash – reclamation deposit 1,117 1,304 Office equipment 90 130 $ 6,263 $ 8,279 |
NOTE 8. CONVERTIBLE NOTES (Tabl
NOTE 8. CONVERTIBLE NOTES (Tables) | 12 Months Ended |
Nov. 30, 2015 | |
Debt Disclosure [Abstract] | |
Convertible notes | Years ended November 30, 2015 2014 2013 Balance – beginning of period $ 15,112 $ 13,570 $ 73,606 Accretion expense 717 1,542 5,101 Repayment or repurchases of Notes (15,829 ) — (65,137 ) Balance – end of period $ — $ 15,112 $ 13,570 |
NOTE 10. FAIR VALUE ACCOUNTING
NOTE 10. FAIR VALUE ACCOUNTING (Tables) | 12 Months Ended |
Nov. 30, 2015 | |
Fair Value Disclosures [Abstract] | |
Fair value of financial instruments | Fair value at November 30, 2015 Total Level 1 Level 2 Level 3 Assets: Marketable equity securities $ 571 $ 571 $ — $ — Fair value at November 30, 2014 Total Level 1 Level 2 Level 3 Assets: Marketable equity securities $ 901 $ 901 $ — $ — |
NOTE 11. GENERAL AND ADMINIST35
NOTE 11. GENERAL AND ADMINISTRATIVE EXPENSES (Tables) | 12 Months Ended |
Nov. 30, 2015 | |
Other Income and Expenses [Abstract] | |
Summary of general and administrative expenses | Years ended November 30, 2015 2014 2013 Salaries $ 6,164 $ 6,022 $ 6,067 Share-based compensation (note 15) 9,488 10,197 12,304 Office expense 2,090 2,626 4,462 Professional fees 693 1,806 2,889 Corporate communications and regulatory 1,452 1,395 1,269 $ 19,887 $ 22,046 $ 26,991 |
NOTE 13. OTHER INCOME (EXPENS36
NOTE 13. OTHER INCOME (EXPENSE) (Tables) | 12 Months Ended |
Nov. 30, 2015 | |
Other Income and Expenses [Abstract] | |
Summary of other income and expense | Years ended November 30, 2015 2014 2013 Interest income $ 740 $ 854 $ 942 Interest expense (5,188 ) (6,838 ) (12,607 ) Foreign exchange gain 4,771 3,688 10,448 Write-down of investments (426 ) — (3,227 ) Gain on derivative liabilities — 83 1,356 $ (103 ) $ (2,213 ) $ (3,088 ) |
NOTE 14. INCOME TAXES (Tables)
NOTE 14. INCOME TAXES (Tables) | 12 Months Ended |
Nov. 30, 2015 | |
Income Tax Disclosure [Abstract] | |
Income tax expense (recovery) | Years ended November 30, 2015 2014 2013 Current: Canada $ — $ — $ — Foreign 155 189 290 155 189 290 Deferred: Canada (2 ) 74 3,606 Foreign — — — (2 ) 74 3,606 Income tax expense $ 153 $ 263 $ 3,896 |
Schedule of Loss before Income Tax, Domestic and Foreign | Years ended November 30, 2015 2014 2013 Canada $ (14,775 ) $ (20,372 ) $ (42,077 ) Foreign (17,024 ) (19,849 ) (16,787 ) $ (31,799 ) $ (40,221 ) $ (58,864 ) |
Schedule of Effective Income Tax Rate Reconciliation | Years ended November 30, 2015 2014 2013 Loss before income taxes (31,799 ) $ (40,221 ) $ (58,864 ) Combined federal and provincial statutory tax rate 26.00 % 26.00 % 25.67 % Income tax recovery based on statutory income tax rates (8,268 ) (10,457 ) (15,110 ) Increase (decrease) attributable to: (Non-deductible) taxable expenditures 3,175 3,339 2,913 Non-taxable unrealized gain (loss) on derivative financial instruments — — 615 Effect of different statutory tax rates on earnings of subsidiaries (2,619 ) (3,027 ) (2,773 ) Effect of statutory rate change — — (1,916 ) Effect of tax losses expired 3,878 1,424 — Change in valuation allowance 4,480 9,357 20,248 Other (493 ) (373 ) (81 ) Income tax expense $ 153 $ 263 $ 3,896 |
Schedule of Deferred Tax Assets and Liabilities | At November 30, 2015 2014 Deferred tax income assets: Asset retirement obligation $ 186 $ 257 Net operating loss carry forwards 212,619 214,594 Capital loss carry forwards 31,561 37,002 Mineral properties 16,596 19,524 Property and equipment 198 354 Investment in affiliates 43,315 42,343 Share issuance costs 776 1,327 Unpaid interest expense 4,458 4,458 Investment tax credit 2,938 3,429 Other 2,339 2,550 314,986 325,838 Valuation allowances (276,521 ) (281,071 ) 38,465 44,767 Deferred income tax liabilities: Investment in affiliates (36,133 ) (42,176 ) Mineral properties (11,315 ) (13,208 ) Capitalized assets & other (1,052 ) (1,102 ) Unrealized gain on investments — (5 ) Investment tax credit (764 ) (882 ) (49,264 ) (57,373 ) Net deferred income tax liabilities $ (10,799 ) $ (12,606 ) Net deferred income tax asset, as presented in the balance sheet $ 9,711 $ 11,445 Net deferred income tax liability, as presented in the balance sheet $ (20,510 ) $ (24,051 ) |
Summary of Operating Loss Carryforwards | Year of Expiry U.S. Canada 2024 $ 1,032 $ — 2025 1,246 — 2026 13,382 24,498 2027 18,493 3,935 2028 85 519 2029 11,223 12,238 2030 10,916 17,607 2031 16,580 16,519 2032 306,333 28,940 2033 14,529 21,642 2034 15,606 10,021 2035 16,833 7,605 $ 426,258 $ 143,524 |
NOTE 15. STOCK-BASED COMPENSATI
NOTE 15. STOCK-BASED COMPENSATION (Tables) | 12 Months Ended |
Nov. 30, 2015 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Recognized stock-based compensation | Years ended November 30, 2015 2014 2013 Stock options $ 4,736 $ 6,062 $ 8,135 Performance share unit plan 4,537 3,944 3,935 Deferred share unit plan 215 191 234 $ 9,488 $ 10,197 $ 12,304 |
Stock Options, Valuation Assumptions | Years ended November 30, 2015 2014 2013 Share price (C$) 3.18 2.90 4.40 Average risk-free interest rate 1.06% 1.18% 1.07% Exercise price (C$) 3.18 2.90 4.40 Expected life (years) 3 3 3 Expected volatility 60% 60% 56% Expected dividends Nil Nil Nil Fair value per share of options granted (C$) 1.28 1.18 1.72 |
Summary of stock options activity | 2015 2014 2013 Number of shares (thousands) Weighted average exercise price (C$) Number of shares (thousands) Weighted average exercise price (C$) Number of shares (thousands) Weighted average exercise price (C$) Outstanding at beginning of year 15,219 5.47 15,223 6.54 13,903 7.08 Granted 4,360 3.18 6,109 2.90 3,218 4.40 Exercised (393) 3.46 (1,285) 2.24 (121) 2.23 Forfeited and expired (1,336) 7.38 (4,828) 6.45 (1,777) 7.22 Outstanding at end of year 17,850 4.81 15,219 5.47 15,223 6.54 Exercisable at year-end 14,092 11,644 12,715 |
Stock options outstanding and exercisable | Stock options - issued and outstanding Stock options - exercisable Range of price (C$) Number of outstanding options (thousands) Weighted average years to expiry Weighted average exercise price (C$) Number of exercisable options (thousands) Weighted average exercise price (C$) 2.90 to 3.99 10,168 3.48 3.02 6,411 2.99 4.00 to 5.99 4,138 1.93 4.59 4,138 4.59 6.00 to 7.99 800 1.45 6.36 800 6.36 10.00 to 11.99 1,712 0.96 10.24 1,711 10.24 12.00 to 13.99 932 0.12 13.02 932 13.02 14.00 to 14.82 100 1.50 14.82 100 14.82 17,850 2.60 4.81 14,092 5.28 |
Peformance share units outstanding | Years ended November 30, 2015 2014 2013 Outstanding at beginning of year 2,422,150 1,268,450 805,300 Granted 1,377,250 1,819,700 706,150 Vested (846,180) (546,380) (167,735) Performance adjustment 228,530 (96,420) (72,765) Forfeited — (23,200) (2,500) Outstanding at end of year 3,181,750 2,422,150 1,268,450 |
NOTE 17. RECLASSIFICATIONS OU39
NOTE 17. RECLASSIFICATIONS OUT OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Tables) | 12 Months Ended |
Nov. 30, 2015 | |
EQUITY | |
Schedule of Accumulated Other Comprehensive Income (Loss) | Unrealized gain (loss) on marketable securities, net Foreign currency translation adjustments Total November 30, 2014 $ (104 ) $ 34,949 $ 34,845 Change in other comprehensive income (loss) before reclassifications (227 ) (52,729 ) (52,956 ) Reclassifications from accumulated other comprehensive income (loss) 426 — 426 Net current-period other comprehensive income (loss) 199 (52,729 ) (52,530 ) November 30, 2015 $ 95 $ (17,780 ) $ (17,685 ) Details about accumulated other comprehensive income (loss) components: Amount reclassified from accumulated other comprehensive income (loss) 2015 2014 2013 Marketable equity securities adjustments Impairment of marketable equity securities (1) $ 426 $ — $ 2,738 Tax benefit (expense) — — — Net of tax $ 426 $ — $ 2,738 (1) |
NOTE 18. CHANGE IN OPERATING 40
NOTE 18. CHANGE IN OPERATING ASSETS AND LIABILITIES (Tables) | 12 Months Ended |
Nov. 30, 2015 | |
Supplemental Cash Flow Elements [Abstract] | |
CHANGE IN OPERATING ASSETS AND LIABILITIES | Years ended November 30, 2015 2014 2013 Decrease (increase) in receivables and other assets $ 908 $ 3,319 $ (89 ) Increase (decrease) in accounts payable and accrued liabilities (275 ) 56 (1,231 ) Decrease in other liabilities (174 ) (202 ) (268 ) $ 459 $ 3,173 $ (1,588 ) |
NOTE 21. SUPPLEMENTAL CASH FL41
NOTE 21. SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 12 Months Ended |
Nov. 30, 2015 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Cash Flow, Supplemental Disclosures | Years ended November 30, 2015 2014 2013 Interest received $ 639 $ 643 $ 630 Interest paid $ 435 $ 870 $ 3,164 Income taxes paid $ 120 $ 432 $ — |
NOTE 22. UNAUDITED SUPPLEMENT42
NOTE 22. UNAUDITED SUPPLEMENTARY DATA (Tables) | 12 Months Ended |
Nov. 30, 2015 | |
Quarterly Financial Information Disclosure [Abstract] | |
Summary of quarterly financial information | 2015 Q1 Q2 Q3 Q4 Operating loss $ (11,286 ) $ (7,246 ) $ (6,579 ) $ (6,585 ) Net loss $ (9,299 ) $ (9,184 ) $ (6,301 ) $ (7,168 ) Loss per common share, basic and diluted $ (0.03 ) $ (0.03 ) $ (0.02 ) $ (0.02 ) 2014 Q1 Q2 Q3 Q4 Operating loss $ (11,333 ) $ (8,264 ) $ (10,755 ) $ (7,656 ) Net loss $ (10,691 ) $ (10,681 ) $ (12,009 ) $ (7,103 ) Loss per common share, basic and diluted $ (0.03 ) $ (0.03 ) $ (0.04 ) $ (0.02 ) |
NOTE 4. INVESTMENT IN DONLIN 43
NOTE 4. INVESTMENT IN DONLIN GOLD (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Balance - beginning of period | $ 283,247 | ||
Share of losses | |||
Depreciation | 35 | $ 36 | $ 37 |
Share of losses | (11,016) | (13,985) | (14,620) |
Balance - end of period | 242,906 | 283,247 | |
Donlin Gold LLC, Alaska, USA | |||
Balance - beginning of period | 1,618 | 1,720 | 4,185 |
Share of losses | |||
Mineral property expenditures | (10,845) | (13,811) | (14,412) |
Depreciation | (171) | (174) | (208) |
Share of losses | (11,016) | (13,985) | (14,620) |
Funding | 10,456 | 13,883 | 12,155 |
Balance - end of period | $ 1,058 | $ 1,618 | $ 1,720 |
NOTE 4. INVESTMENT IN DONLIN 44
NOTE 4. INVESTMENT IN DONLIN GOLD (Details 1) - Donlin Gold LLC, Alaska, USA - USD ($) $ in Thousands | Nov. 30, 2015 | Nov. 30, 2014 |
Current assets: Cash, prepaid expenses and other receivables | $ 1,762 | $ 2,294 |
Non-current assets: Property and equipment | 232 | 403 |
Non-current assets: Mineral property | 32,692 | 32,692 |
Current liabilities: Accounts payable and accrued liabilities | (936) | (1,079) |
Non-current liabilities: Reclamation | (692) | (692) |
Net assets | $ 33,058 | $ 33,618 |
NOTE 5. INVESTMENT IN GALORE 45
NOTE 5. INVESTMENT IN GALORE CREEK (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Balance - beginning of period | $ 283,247 | ||
Share of losses | |||
Depreciation | 35 | $ 36 | $ 37 |
Share of losses | (11,016) | (13,985) | (14,620) |
Balance - end of period | 242,906 | 283,247 | |
The Galore Creek Partnership, British Columbia, Canada | |||
Balance - beginning of period | 283,247 | 305,735 | 335,086 |
Share of losses | |||
Mineral property expenditures | (147) | (442) | (4,580) |
Care and maintenance expense | (884) | (1,499) | (2,444) |
Gain on sale of equipment | 639 | 0 | 0 |
Depreciation | 0 | 0 | (6,328) |
Share of losses | (392) | (1,941) | (13,352) |
Funding | 508 | 2,063 | 6,638 |
Exploration tax credit | 107 | (693) | (1,352) |
Foreign currency translation | (40,564) | (21,917) | (21,285) |
Balance - end of period | $ 242,906 | $ 283,247 | $ 305,735 |
NOTE 5. INVESTMENT IN GALORE 46
NOTE 5. INVESTMENT IN GALORE CREEK (Details 2) - The Galore Creek Partnership, British Columbia, Canada - USD ($) $ in Thousands | Nov. 30, 2015 | Nov. 30, 2014 |
Current assets: Cash, prepaid expenses and other receivables | $ 497 | $ 386 |
Non-current assets: Property and equipment | 218,532 | 254,991 |
Current liabilities: Accounts payable and accrued liabilities | (365) | (360) |
Non-current liabilities: payables and decommissioning liabilities | (7,162) | (8,268) |
Net assets | $ 211,502 | $ 246,749 |
NOTE 7. OTHER ASSETS (Details)
NOTE 7. OTHER ASSETS (Details) - USD ($) $ in Thousands | Nov. 30, 2015 | Nov. 30, 2014 |
Other current assets: | ||
Accounts and interest receivable | $ 295 | $ 137 |
Receivable from Galore Creek Partnership | 28 | 32 |
Mineral exploration tax credit receivable | 1,487 | 1,894 |
Note receivable | 919 | 945 |
Prepaid expenses | 581 | 727 |
Other current assets | 3,310 | 3,735 |
Other long-term assets: | ||
Note receivable | 939 | 1,805 |
Marketable equity securities | 571 | 901 |
Receivable from Galore Creek Partnership | 3,546 | 4,139 |
Restricted cash - reclamation deposit | 1,117 | 1,304 |
Office equipment | 90 | 130 |
Other long-term assets | $ 6,263 | $ 8,279 |
NOTE 8. CONVERTIBLE NOTES (Deta
NOTE 8. CONVERTIBLE NOTES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Debt Disclosure [Abstract] | |||
Balance - beginning of period | $ 15,112 | $ 13,570 | $ 73,606 |
Accretion expense | 717 | 1,542 | 5,101 |
Repurchases of Notes | (15,829) | 0 | (65,137) |
Balance - end of period | $ 0 | $ 15,112 | $ 13,570 |
NOTE 10. FAIR VALUE ACCOUNTIN49
NOTE 10. FAIR VALUE ACCOUNTING (Details) - USD ($) $ in Thousands | Nov. 30, 2015 | Nov. 30, 2014 |
Assets: | ||
Marketable equity securities | $ 571 | $ 901 |
Level 1 | ||
Assets: | ||
Marketable equity securities | 571 | 901 |
Level 2 | ||
Assets: | ||
Marketable equity securities | 0 | 0 |
Level 3 | ||
Assets: | ||
Marketable equity securities | $ 0 | $ 0 |
NOTE 11. GENERAL AND ADMINIST50
NOTE 11. GENERAL AND ADMINISTRATIVE EXPENSES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Other Income and Expenses [Abstract] | |||
Salaries | $ 6,164 | $ 6,022 | $ 6,067 |
Share based compensation (note 15) | 9,488 | 10,197 | 12,304 |
Office expense | 2,090 | 2,626 | 4,462 |
Professional fees | 693 | 1,806 | 2,889 |
Corporate communications and regulatory | 1,452 | 1,395 | 1,269 |
General and administrative | $ 19,887 | $ 22,046 | $ 26,991 |
NOTE 13. OTHER INCOME (EXPENS51
NOTE 13. OTHER INCOME (EXPENSE) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Other Income and Expenses [Abstract] | |||
Interest income | $ 740 | $ 854 | $ 942 |
Interest expense | (5,188) | (6,838) | (12,607) |
Foreign exchange gain | 4,771 | 3,688 | 10,448 |
Write-down of investments | (426) | 0 | (3,227) |
Gain on derivative liabilities | 0 | 83 | 1,356 |
Total other income (expense) | $ (103) | $ (2,213) | $ (3,088) |
NOTE 14. INCOME TAXES (Details)
NOTE 14. INCOME TAXES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Current: | |||
Canada | $ 0 | $ 0 | $ 0 |
Foreign | 155 | 189 | 290 |
Total current income tax expense | 155 | 189 | 290 |
Deferred: | |||
Canada | (2) | 74 | 3,606 |
Foreign | 0 | 0 | 0 |
Total deferred income tax expense | (2) | 74 | 3,606 |
Income tax expense (recovery) | $ 153 | $ 263 | $ 3,896 |
NOTE 14. INCOME TAXES (Details
NOTE 14. INCOME TAXES (Details 1) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Income Tax Disclosure [Abstract] | |||
Canada | $ (14,775) | $ (20,372) | $ (42,077) |
Foreign | (17,024) | (19,849) | (16,787) |
Income (loss) before income taxes | $ (31,799) | $ (40,221) | $ (58,864) |
NOTE 14. INCOME TAXES (Detail54
NOTE 14. INCOME TAXES (Details 2) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Income Tax Disclosure [Abstract] | |||
Loss before income taxes | $ (31,799) | $ (40,221) | $ (58,864) |
Combined federal and provincial statutory tax rate | 26.00% | 26.00% | 25.67% |
Income tax recovery based on statutory income tax rates | $ (8,268) | $ (10,457) | $ (15,110) |
Increase (decrease) attributable to: | |||
(Non-deductible) taxable expenditures | 3,175 | 3,339 | 2,913 |
Non-taxable unrealized gain (loss) on derivative financial instruments | 0 | 0 | 615 |
Effect of different statutory tax rates on earnings of subsidiaries | (2,619) | (3,027) | (2,773) |
Effect of statutory rate change | 0 | 0 | (1,916) |
Effect of tax losses expired | 3,878 | 1,424 | 0 |
Change in valuation allowance | 4,480 | 9,357 | 20,248 |
Other | (493) | (373) | (81) |
Income tax expense | $ 153 | $ 263 | $ 3,896 |
NOTE 14. INCOME TAXES (Detail55
NOTE 14. INCOME TAXES (Details 3) - USD ($) $ in Thousands | Nov. 30, 2015 | Nov. 30, 2014 |
Deferred tax income assets: | ||
Asset retirement obligation | $ 186 | $ 257 |
Net operating loss carry forwards | 212,619 | 214,594 |
Capital loss carry forwards | 31,561 | 37,002 |
Mineral properties | 16,596 | 19,524 |
Property and equipment | 198 | 354 |
Investment in affiliates | 43,315 | 42,343 |
Share issuance costs | 776 | 1,327 |
Unpaid interest expense | 4,458 | 4,458 |
Investment tax credit | 2,938 | 3,429 |
Other | 2,339 | 2,550 |
Deferred Tax Assets, gross | 314,986 | 325,838 |
Valuation allowances | (276,521) | (281,071) |
Deferred Tax Assets, net | 38,465 | 44,767 |
Deferred income tax liabilities: | ||
Investment in affiliates | (36,133) | (42,176) |
Mineral properties | (11,315) | (13,208) |
Capitalized assets & other | (1,052) | (1,102) |
Unrealized gain on investments | 0 | (5) |
Investment tax credit | (764) | (882) |
Deferred tax liabilities | (49,264) | (57,373) |
Net deferred income tax liabilities | (10,799) | (12,606) |
Net deferred income tax asset, as presented in the balance sheet | 9,711 | 11,445 |
Net deferred income tax liability, as presented in the balance sheet | $ (20,510) | $ (24,051) |
NOTE 14. INCOME TAXES (Detail56
NOTE 14. INCOME TAXES (Details 4) $ in Thousands | Nov. 30, 2015USD ($) |
U.S | |
Net operating losses carry-forwards | $ 426,258 |
U.S | 2024 | |
Net operating losses carry-forwards | 1,032 |
U.S | 2025 | |
Net operating losses carry-forwards | 1,246 |
U.S | 2026 | |
Net operating losses carry-forwards | 13,382 |
U.S | 2027 | |
Net operating losses carry-forwards | 18,493 |
U.S | 2028 | |
Net operating losses carry-forwards | 85 |
U.S | 2029 | |
Net operating losses carry-forwards | 11,223 |
U.S | 2030 | |
Net operating losses carry-forwards | 10,916 |
U.S | 2031 | |
Net operating losses carry-forwards | 16,580 |
U.S | 2032 | |
Net operating losses carry-forwards | 306,333 |
U.S | 2033 | |
Net operating losses carry-forwards | 14,529 |
U.S | 2034 | |
Net operating losses carry-forwards | 15,606 |
U.S | 2035 | |
Net operating losses carry-forwards | 16,833 |
Canada | |
Net operating losses carry-forwards | 143,524 |
Canada | 2024 | |
Net operating losses carry-forwards | 0 |
Canada | 2025 | |
Net operating losses carry-forwards | 0 |
Canada | 2026 | |
Net operating losses carry-forwards | 24,498 |
Canada | 2027 | |
Net operating losses carry-forwards | 3,935 |
Canada | 2028 | |
Net operating losses carry-forwards | 519 |
Canada | 2029 | |
Net operating losses carry-forwards | 12,238 |
Canada | 2030 | |
Net operating losses carry-forwards | 17,607 |
Canada | 2031 | |
Net operating losses carry-forwards | 16,519 |
Canada | 2032 | |
Net operating losses carry-forwards | 28,940 |
Canada | 2033 | |
Net operating losses carry-forwards | 21,642 |
Canada | 2034 | |
Net operating losses carry-forwards | 10,021 |
Canada | 2035 | |
Net operating losses carry-forwards | $ 7,605 |
NOTE 15. STOCK-BASED COMPENSA57
NOTE 15. STOCK-BASED COMPENSATION (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Stock-based compensation | $ 9,488 | $ 10,197 | $ 12,304 |
Stock Options [Member] | |||
Stock-based compensation | 4,736 | 6,062 | 8,135 |
Performance Share Unit Plan | |||
Stock-based compensation | 4,537 | 3,944 | 3,935 |
Deferred Share Unit Plan | |||
Stock-based compensation | $ 215 | $ 191 | $ 234 |
NOTE 15. STOCK-BASED COMPENSA58
NOTE 15. STOCK-BASED COMPENSATION (Details 1) - $ / shares | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |||
Weighted average share price | $ 3.18 | $ 2.90 | $ 4.40 |
Average risk-free interest rate, minimum | 1.06% | 1.18% | 1.07% |
Exercise price | $ 3.18 | $ 2.90 | $ 4.40 |
Expected life (years), minimum | 3 years | 3 years | 3 years |
Expected volatility, minimum | 60.00% | 60.00% | 56.00% |
Expected dividends | 0.00% | 0.00% | 0.00% |
Fair value per share of options granted | $ 1.28 | $ 1.18 | $ 1.72 |
NOTE 15. STOCK-BASED COMPENSA59
NOTE 15. STOCK-BASED COMPENSATION (Details 2) - Stock Options [Member] - CAD / shares | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Balance - beginning of year | 15,219 | 15,223 | 13,903 |
Granted | 4,360 | 6,109 | 3,218 |
Exercised | (393) | (1,285) | (121) |
Forfeited and expired | (1,336) | (4,828) | (1,777) |
Balance - end of year | 17,850 | 15,219 | 15,223 |
Exercisable at year-end | 14,092 | 11,644 | 12,715 |
Weighted average exercise price outstanding, beginning | CAD 5.47 | CAD 6.54 | CAD 7.08 |
Granted | 3.18 | 2.90 | 4.40 |
Exercised | 3.46 | 2.24 | 2.23 |
Forfeited and expired | 7.38 | 6.45 | 7.22 |
Weighted average exercise price outstanding, ending | CAD 4.81 | CAD 5.47 | CAD 6.54 |
NOTE 15. STOCK-BASED COMPENSA60
NOTE 15. STOCK-BASED COMPENSATION (Details 3) | 12 Months Ended |
Nov. 30, 2015$ / sharesshares | |
Stock options - issued and outstanding: Number of outstanding options | shares | 17,850 |
Stock options - issued and outstanding: Weighted average years to expiry | 2 years 7 months 6 days |
Stock options - issued and outstanding: Weighted average exercise price | $ / shares | $ 4.81 |
Stock options - exercisable: Number of exercisable options | shares | 14,092 |
Stock options - exercisable: Weighted average exercise price | $ / shares | $ 5.28 |
$ C 2.90 to $ 3.99 | |
Stock options - issued and outstanding: Number of outstanding options | shares | 10,168 |
Stock options - issued and outstanding: Weighted average years to expiry | 3 years 5 months 23 days |
Stock options - issued and outstanding: Weighted average exercise price | $ / shares | $ 3.02 |
Stock options - exercisable: Number of exercisable options | shares | 6,411 |
Stock options - exercisable: Weighted average exercise price | $ / shares | $ 2.99 |
$ C 4.00 to $ 5.99 | |
Stock options - issued and outstanding: Number of outstanding options | shares | 4,138 |
Stock options - issued and outstanding: Weighted average years to expiry | 1 year 11 months 5 days |
Stock options - issued and outstanding: Weighted average exercise price | $ / shares | $ 4.59 |
Stock options - exercisable: Number of exercisable options | shares | 4,138 |
Stock options - exercisable: Weighted average exercise price | $ / shares | $ 4.59 |
$ C 6.00 to $ 7.99 | |
Stock options - issued and outstanding: Number of outstanding options | shares | 800 |
Stock options - issued and outstanding: Weighted average years to expiry | 1 year 5 months 12 days |
Stock options - issued and outstanding: Weighted average exercise price | $ / shares | $ 6.36 |
Stock options - exercisable: Number of exercisable options | shares | 800 |
Stock options - exercisable: Weighted average exercise price | $ / shares | $ 6.36 |
$ C10.00 to $11.99 | |
Stock options - issued and outstanding: Number of outstanding options | shares | 1,712 |
Stock options - issued and outstanding: Weighted average years to expiry | 11 months 16 days |
Stock options - issued and outstanding: Weighted average exercise price | $ / shares | $ 10.24 |
Stock options - exercisable: Number of exercisable options | shares | 1,711 |
Stock options - exercisable: Weighted average exercise price | $ / shares | $ 10.24 |
$ C12.00 to $13.99 | |
Stock options - issued and outstanding: Number of outstanding options | shares | 932 |
Stock options - issued and outstanding: Weighted average years to expiry | 1 month 13 days |
Stock options - issued and outstanding: Weighted average exercise price | $ / shares | $ 13.02 |
Stock options - exercisable: Number of exercisable options | shares | 932 |
Stock options - exercisable: Weighted average exercise price | $ / shares | $ 13.02 |
$ C14.00 to $14.82 | |
Stock options - issued and outstanding: Number of outstanding options | shares | 100 |
Stock options - issued and outstanding: Weighted average years to expiry | 1 year 6 months |
Stock options - issued and outstanding: Weighted average exercise price | $ / shares | $ 14.82 |
Stock options - exercisable: Number of exercisable options | shares | 100 |
Stock options - exercisable: Weighted average exercise price | $ / shares | $ 14.82 |
NOTE 15. STOCK-BASED COMPENSA61
NOTE 15. STOCK-BASED COMPENSATION (Details 4) - PSUs - shares | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Balance - beginning of year | 2,422,150 | 1,268,450 | 805,300 |
Granted | 1,377,250 | 1,819,700 | 706,150 |
Vested | (846,180) | (546,380) | (167,735) |
Performance adjustment | 228,530 | (96,420) | (72,765) |
Forfeited | 0 | (23,200) | (2,500) |
Balance - end of year | 3,181,750 | 2,422,150 | 1,268,450 |
NOTE 15. STOCK-BASED COMPENSA62
NOTE 15. STOCK-BASED COMPENSATION (Details Narrative) - $ / shares | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Share-based Compensation [Abstract] | |||
Weighted-average fair value of options granted | $ 1.28 | $ 1.18 | $ 1.72 |
Non-vested options outstanding | 3,758,000 | 3,575,000 | |
Non-vested options, weighted average exercise price | $ 3.07 | $ 3.15 | |
Options vested during the year | 4,177,000 | 4,636,000 | 3,385,000 |
NOTE 17. RECLASSIFICATIONS OU63
NOTE 17. RECLASSIFICATIONS OUT OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
EQUITY | |||
Unrealized gain (loss) on marketable securities | $ 95 | $ (104) | |
Foreign currency translation adjustments | (17,780) | 34,949 | |
Accumulated other comprehensive income | (17,685) | 34,845 | |
Unrealized holding gains (losses) during period | (227) | (288) | $ (855) |
Reclassification adjustment for losses included in net income | 426 | 0 | 2,738 |
Net unrealized gain (loss) | 199 | (288) | 1,883 |
Foreign currency translation adjustments | (52,729) | (29,371) | (34,687) |
Other comprehensive income (loss) | $ (52,530) | $ (29,659) | $ (32,804) |
NOTE 18. CHANGE IN OPERATING 64
NOTE 18. CHANGE IN OPERATING ASSETS AND LIABILITIES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Supplemental Cash Flow Elements [Abstract] | |||
Decrease (increase) in receivables and other assets | $ 908 | $ 3,319 | $ (89) |
Increase (decrease) in accounts payable and accrued liabilities | (275) | 56 | (1,231) |
Decrease in other liabilities | (174) | (202) | (268) |
Net change in operating assets and liabilities (note 13) | $ 459 | $ 3,173 | $ (1,588) |
NOTE 19. RELATED PARTY TRANSA65
NOTE 19. RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Donlin Gold LLC, Alaska, USA | |||
Related party transactions - exploration and management services | $ 0 | $ 235 | $ 258 |
The Galore Creek Partnership, British Columbia, Canada | |||
Related party transactions - office rental and services and office administration services | 349 | 398 | 423 |
Account receivable, related party - current | 28 | 32 | |
Account receivable, related party - noncurrent | 3,546 | 4,139 | |
NovaCopper | |||
Related party transactions - office rental and services and office administration services | $ 0 | $ 0 | $ 168 |
NOTE 20. COMMITMENTS AND CONT66
NOTE 20. COMMITMENTS AND CONTINGENCIES (Details Narrative) $ in Thousands | Nov. 30, 2015USD ($) |
Future minimum annual lease payments | |
2,016 | $ 385 |
2,017 | 336 |
2,018 | 41 |
Total minimum annual lease payments | $ 762 |
NOTE 21. SUPPLEMENTAL CASH FL67
NOTE 21. SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Supplemental Cash Flow Elements [Abstract] | |||
Interest received | $ 639 | $ 643 | $ 630 |
Interest paid | 435 | 870 | 3,164 |
Income taxes paid | $ 120 | $ 432 | $ 0 |
NOTE 22. UNAUDITED SUPPLEMENT68
NOTE 22. UNAUDITED SUPPLEMENTARY DATA (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||
Nov. 30, 2015 | Aug. 31, 2015 | May. 31, 2015 | Feb. 28, 2015 | Nov. 30, 2014 | Aug. 31, 2014 | May. 31, 2014 | Feb. 28, 2014 | Nov. 30, 2015 | Nov. 30, 2014 | Nov. 30, 2013 | |
Quarterly Financial Information Disclosure [Abstract] | |||||||||||
Operating loss | $ (6,585) | $ (6,579) | $ (7,246) | $ (11,286) | $ (7,656) | $ (10,755) | $ (8,264) | $ (11,333) | $ (31,696) | $ (38,008) | $ (55,776) |
Net loss | $ (7,168) | $ (6,301) | $ (9,184) | $ (9,299) | $ (7,103) | $ (12,009) | $ (10,681) | $ (10,691) | $ (31,952) | $ (40,484) | $ (62,760) |
Loss per common share, basic and diluted | $ (0.02) | $ (0.02) | $ (0.03) | $ (0.03) | $ (0.02) | $ (0.04) | $ (0.03) | $ (0.03) | $ (0.10) | $ (0.13) | $ (0.2) |