Safe haven bets have returned since the start of this year as investors have been spooked by concerns over the situation in the euro zone and a slowdown in China. Not surprisingly, one of the beneficiaries of the increasing safe haven bets has been gold.
Gold prices have climbed to around $1,275 U.s. an ounce since the start of this year. Importantly, prices could remain strong as investors pull money out of risk assets. This bodes well for gold miners, including junior mining companies like Goldrush Resources Ltd. (TSX-Venture:GOD).
Based in Vancouver, B.C., Goldrush is primarily involved in the acquisition and exploration of mineral property interests in the West African nation of Burkina Faso. The company is engaged in the exploration of gold in the West African nation.
Goldrush has been engaged in exploration activities in Burkina Faso since 2006. Last year, the company sold three of its permits in the country to international mining companies, boosting its cash reserves.
One of the permits Goldrush sold last year was the Pompoi exploration permit. The company sold the Pompoi permit, along with the rights to the adjoining Banguiou exploration permit application for a consideration of $435,000. In addition, the company will also receive a fixed net smelter return royalty of 1.5% on gold sold from the Pompoi and Banguiou permit for a period of 15 years.
Following the sale of the Pompoi permit in April last year, Goldrush also executed a definitive agreement for the sale of the Ronguen Gold project to Nord Gold N.V. The agreement was signed in June last year and under the terms, Goldrush agreed to sell Nordgold all of the shares of its 100%-owned subsidiary, Goldrush Burkina S.A.R.L. Goldrush Burkina is the owner of two mineral permits that are part of the Ronguen Gold project.
In November last year, Goldrush also announced a change in its senior management, with the appointment of Scott Hamilton as Chief Financial Officer (CFO). Hamilton has nearly two decades of experience with junior mining and industrial companies.
Commenting on Hamilton’s appointment, Goldrush President and CEO Len Brownlie had this to say, "We are very fortunate that Scott has made the transition to Chief Financial Officer for the Company where his extensive experience in junior company accounting will be a tremendous asset to the Board as we determine the best path forward for Goldrush following the successful $4.25-million U.S. sale of the Ronguen gold deposit."
Hamilton replaced Kim Phillips, who resigned from his post as CFO.
Goldrush also released its most recent financial results (Q3) in November last year. For the quarter ended September 30, 2014, the company reported a net loss of $130,131, or $0.00 per share. This is slightly higher than the net loss of $85,989, or $0.00 per share, the company reported for the same period in 2013. For the nine-month period ended September 30, 2014, the miner had a loss of $112,060, well below the net loss of $254,117 it reported for the same period in 2013.
At the end of the September quarter, Goldrush had a working capital deficiency of $348,736. However, the sale of permits last year has improved the company’s liquidity. In addition, following the end of the third quarter, the company received the first tranche of the payment for the sale of Goldush Burkina to Nordgold. The first tranche payment totaled $3.25 million U.S. and has significantly boosted Goldrush’s financial position.
