First Quarter Report
Management Discussion and Analysis
First Quarter Report for the Period Ended March 31, 2002
This Management Discussion and Analysis (MD&A) for the First Quarter
Report, 2002 should be read in conjunction with the interim consolidated
financial statements for the three-month period ended March 31, 2002.
It is assumed that readers are already familiar with the MD&A and
financial statements contained in the First Quarter Report, 2001. The
MD&A is an assessment of the financial affairs of the Company for
the most recent fiscal period. All figures are in $US.
Since its incorporation the Company has endeavored to secure valuable
mineral properties that in due course could be explored, developed and
brought into production to provide the Company with positive cash flow.
To that end, the Company has expended its funds exploring and developing
mineral properties each year since incorporation. As a result, the Company
has incurred losses during each of its fiscal years since incorporation.
Losses are typical of development-stage exploration and mining companies
and are expected to continue until positive cash flow is achieved.
The Company knows of no trends, demands, commitments, events or uncertainties
outside of the normal course of business that may result in the Company’s
liquidity either materially increasing or decreasing at the present time
or in the foreseeable future. Material increases or decreases in the Company’s
liquidity are substantially determined by the success or failure of the
Company’s exploration programs and overall market conditions for
smaller resource companies. The Company is not aware of any seasonality
in the business that have a material effect upon its financial condition,
results of operations or cash flows other than those normally encountered
by public reporting smaller resource companies. The Company is not aware
of any changes in it’s the results of its operations that are other
than those normally encountered in its ongoing business.
Liquidity and Capital Resources
The Company had positive working capital of $272,000 at March 31, 2002
as compared to $366,000 at December 31, 2001. Current assets fell 14%
to $407,000 and current liabilities also dropped 14% to $92,000 during
the First Quarter of 2002 as the Company continued to pay down its current
accounts. The Company’s principal sources of funds continue to be
the annual cash payments from our partner on the Bellavista project in
Costa Rica and the raising of capital from time to time by issuing securities.
Results of Operations
The Company experienced a loss of $50,000 ($0.001 per share) for the
3 month period ending March 31, 2002, a reduction of 224% as compared
to a loss of $112,000 ($0.003 per share) for the 3 month period ended
March 31, 2001. The Company incurred cash expenditures totalling $56,000
on general, administrative, and other costs in the First Quarter of 2002,
a reduction of 250% as compared to $140,000 in the First Quarter of 2001.
The use of capital during the period was mainly directed toward company
operating expenses rather than asset acquisitions or development programs.