Mega Uranium Ltd. (TSE:MGA) (PINK:MGAFF) share price continues on the downtrend as usual but the stock attracted attention when it recorded a tremendous trading volume on Monday. 4.5 million shares changed hands during the session. The stock price didn’t show that much action though.
The daily candle left a long downwards shadow after breaking below 20 cents per share but remained inside the very narrow downtrend.
The action could have come as a delayed reaction to the financial results for the fiscal year ended September 30 which the company released on December 15. The books marked some serious negative developments compared to 2010:
- Revenues were negative $1.6 million due to losses on investments in public companies;
- Operating expenses grew threefold to $147.6 million as a result of large write-down of mineral properties;
- Net loss for the year was 4 times larger than in 2010.
Still most of the sums were non-cash which lead to only $1.85 million negative cash flow. The write-downs occurred when Mega Uranium terminated options on a number of mining properties. Cash cost of write-offs was $6.38 million and the rest came as an impairment of value.
The company retains ownership to various degrees a number of other properties throughout the world, but doesn’t generate any revenue from mining. An interesting fact is that Mega Uranium decided to drop their rights to the Lake Maintland properties which were name as their flagship project.
