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Third Quarter

Interim Report

Consolidated Financial Statements

Three Months Ended September 30, 2009

Toronto Office

Suite 1220, 20 Toronto Street

Toronto, Ontario M5C 2B8

Tel : (416) 703-3751

Fax : (416) 367-3638

E-mail : info@moydow.com

Dublin Office                                    

74 Haddington Road                        

Dublin 4, Ireland                           

Tel : (353) 1-667-7611                               

Fax : (353) 1-667-7622                               

E-mail : www.moydow.com                       

MOYDOW MINES INTERNATIONAL INC. 

CONSOLIDATED BALANCE SHEETS

(expressed in United States dollars, unless otherwise stated)

Assets   Current assets		September 30 2009 (un-audited)	December 31  2008 (audited)
Cash and cash equivalents		$66,078	$146,937
Accounts receivable and prepaid expenses		5,388	156,595
Other assets		6,595	11,807
		78,061	315,339
Mineral properties (Note 2)		698,480	9,542,497
		776,541	9,857,836
Liabilities
Current liabilities
Accounts payable and accrued liabilities		332,966	387,374
Related party payable (Note 4)		8,393,342	6,965,039
Loan		7,717	7,717
Current income tax liability		33,674	33,674
		8,767,699	7,393,804
Shareholders' Equity
Capital stock (Note 3)		22,073,991	22,073,991
Contributed surplus		710,225	710,225
Deficit		(30,775,374)	(20,320,184)
		7,991,158	2,4654,032
		776,541	9,857,836

Nature of operations and going concern (note 1)

  MOYDOW MINES INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF EARNINGS(UN-AUDITED)

(expressed in United States dollars, unless otherwise stated)

	Three months ended		Nine months ended
	Sept 30, 2009	Sept 30, 2008	Sept 30, 2009	Sept 30, 2008
Expenses	$	$	$	$
Write-down of mineral properties	2,100,652		9,283,849
Stock - based compensation	-	3,672	-	51,147
General and administrative	465,949	275,051	1,009,006	850,052
Amortization of plant & equipment	(104)	378	-	1,131
Foreign exchange loss/ (gain)	34,808	(35,904)	46,703	(45,027)
	2,601,305	243,197	10,339,558	857,303
Other income and expenses Option fee	-		10,000
Interest expenses	(33,425)	(87,154)	(140,999)	(264,310)
Unrealized (loss)/ gain on financial assets held for trading	14,324	(20,470)	15,184	(27,887)
Interest income	25	1,476	183	1,587
	(19,076)	(106,148)	(115,632)	(290,610)
Loss before income taxes	(2,620,381)	(349,345)	(10,455,190)	(1,147,913)
Income tax provision	-	141,259	-	170,207
Comprehensive loss for the period	(2,620,381)	(208,086)	(10,455,190)	(977,706)
Basic and diluted loss per common share	(0.04)	(0.003)	(0.17)	(0.017)
Weighted average number of
common shares outstanding	60,572,904	60,572,904	60,572,904	58,961,182
Deficit, beginning of period	(28,154,993)	(14,326,262)	(20,320,184)	(13,556,642)
Loss for period	(2,620,381)	(208,086)	(10,455,190)	(977,706)
Deficit, end of period	(30,775,374)	(14,534,348)	(30,775,374)	(14,534,348)

 

MOYDOW MINES INTERNATIONAL INC.

CONSOLIDATED STATEMENTS OF CASH FLOW (UN-AUDITED)

(expressed in United States dollars, unless otherwise stated)

	Three months ended		Nine months ended
	Sept 30, 2009	Sept 30, 2008	Sept 30, 2009	Sept 30, 2008
	$	$	$	$
Cash provided by (used in) operating activities
Loss for the period	(2,620,381)	(208,086)	(10,455,190)	(977,706)
Adjustments for non-cash items: Writedown of mineral properties	2,100,652		9,283,849
Stock-based compensation	-	3,672	-	51,147
Amortization of plant and equipment	(104)	378	-	1,131
Unrealised loss on financial assets held for trading	6,463	20,470	5,211	27,887
	(513,370)	(183,566)	(1,166,130)	(897,541)
Changes in non-cash working capital:
Accounts receivable and prepaid expenses	17,961	(237,670)	151,207	184,498
Accounts payable and accrued liabilities
and income taxes	452,641	(190,675)	1,373,896	2,069,874
	470,602	428,345	1,525,103	2,254,372
	(42,768)	(611,911)	358,973	1,356,831
Investing activities
Exploration of mineral properties	(5,072)	280,837	(439,832)	(2,154,446)
Financing activities
Proceeds from issue of capital stock	-	-	-	797,011
Loan	-	-	-	-
	-	-	-	797,011
Increase in cash and cash equivalents	(37,696)	(331,074)	(80,859)	(604)
Cash and cash equivalents at beginning of period	103,774	424,203	146,937	93,733
Cash and cash equivalents at end of period	66,078	93,129	66,078	93,129
Supplemental information
Cash income taxes paid	-	-	-	-
Cash interest paid	-		-	-

 

MOYDOW MINES INTERNATIONAL INC. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(expressed in United States dollars, unless otherwise stated)

• Nature of operations and going concern

Moydow Mines International Inc. (Moydow or the Company) is an international exploration company with primary interests in precious metals, diamonds and industrial minerals. Moydow's common shares are listed on both the Toronto Stock Exchange and the AIM Market of the London Stock Exchange.  

The Company is exploring its mineral properties and, as at September 30, 2009, had not determined the existence of economically recoverable reserves (note 2). The recoverability of the amounts shown for mineral properties is dependent upon the existence of economically recoverable mineral reserves, the preservation of the Company's interest in the underlying mineral claims, the ability to obtain necessary financing, to obtain government approval and to attain profitable production or, alternatively, upon the Company's ability to profitably dispose of its interests. 

These financial statements have been prepared using Canadian generally accepted accounting principles applicable to a going concern, which contemplates the realization of assets and settlement of liabilities in the normal course of business as they come due. As at September 30, 2009, the Company had an excess of current liabilities over current assets of $8.69 million and has recorded losses and net cash outflows from operations for the past three years. The Company is also required to make expenditures in the near term to keep its mineral property rights in Angola. The Company will have to secure additional financing to meet its required commitments. These circumstances lend substantial doubt as to the ability of the Company to meet its obligations as they come due and, accordingly, the appropriateness of the use of accounting principles applicable to a going concern. 

In recognition of these circumstances, the Company is exploring various initiatives to secure capital so that Moydow can continue as a going concern. It is not possible to determine, with any certainty, the success, adequacy or sufficiency of these initiatives. 

The Company's ability to continue as a going concern is dependent upon its ability to fund its working capital and exploration requirements and eventually to generate positive cash flows, either from operations or sale of a property. These financial statements do not reflect the adjustments to the carrying values of assets and liabilities and the reported expenses and balance sheet classifications that would be necessary were the going concern assumption inappropriate. These adjustments could be material.

Operating results for the periods ended September 30, 2009 are not necessarily indicative of the results that may be expected for the full year ended December 31, 2009. For further information, see the Company's consolidated financial statements including the notes thereto included in the Annual Report for the year ended December 31, 2008.

 

MOYDOW MINES INTERNATIONAL INC. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(expressed in United States dollars, unless otherwise stated)

2) Mineral properties

The Company, either directly or through certain joint ventures, has obligations to expend various amounts on its mineral properties and projects in order to keep its mineral property rights in good standing. All agreements are in the normal course of business.

	Angola $	Sierra Leone $	Ghana $	Total $
Balance-December 31, 2008	6,999,015	1,939,465	604,017	9,542,497
Costs-March 31, 2009	149,374	58,614	21,238	229,226
Balance-March 31, 2009	7,148,389	1,998,079	625,255	9,771,723
Costs-June 30, 2009	34,808	139,809	41,061	215,678

Write-down

(7,183,197)

-

-

(7,183,197)

Balance-June 30, 2009

-

2,137,888

666,316

2,804,204

Cost - September 30, 2009	(48,251)	11,015	32,164	(5,072)
Write-down	48,251	(2,148,903)	-	(2,100,652)
Balance-September 30, 2009	-	-	698,480	698,480

During the period ended September 30, 2009, the management of the company decided to write off all expenditures on the Kimberlite diamond property, Angola, in the sum of $7.18 million. The writedown was necessitated by the extraordinary challenging times for the diamond industry and the global economic crisis together with concerns over the commercial viability of the mineral deposit which is dependent on a number of factors together with concerns over the particular attributes of the deposit, such as its size, grade and proximity to infrastructure. 

The management of the Company decided to write off all expenditures on the Port Loko property, Sierra Leone, in the sum of $2.15 million due to an on-going dispute with the Ministry of Mineral Resources in Sierra Leone.

MOYDOW MINES INTERNATIONAL INC. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(expressed in United States dollars, unless otherwise stated)

3) Capital stock

Authorized-Unlimited number of common shares

		Number of shares		$
Balance - December 31, 2008		60,572,904		22,073,991
Issue of shares		-		-
Balance - September 30, 2009		60,572,904		22,073,991

4) Transactions with Related Parties 

Related party transactions relate primarily to the payment of fees under contracts for services with companies in which a Moydow Mines' director is a shareholder and director. The Company was charged a total of $0.22 million during the nine months to September 30, 2009 (2008 - $0.15 million) with respect to administration services. 

The Company's primary legal counsel is a firm in which a director of the Company is a partner. The Company was charged $0.0l million during the nine months to September 30, 2009 (2008 - $0.05 million) for legal services provided by this firm. 

A company controlled by certain insiders of the Company advanced money to the Company and interest has been accrued at Libor plus 2%. The amount of interest charged to the Company during the first nine months of 2009 and 2008 was $0.14 million and $0.26 million, respectively. 

These transactions are made in the normal course of business.

 

MOYDOW MINES INTERNATIONAL INC. 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(expressed in United States dollars, unless otherwise stated)

Corporate Information.

Directors and Officers

Noel P. Kiernan - Director, Chairman

Brian P. Kiernan - Director, President & CEO

J. Joseph Breen - Director & COO

Michael E. Power - Director, Vice President & Secretary

Albert Gourley - Director & Audit Committee

Richard Linnell - Director & Audit Committee

L. Comerford - Director & Audit Committee

Rosemary G. O'Mongain - CFO

Toronto Office

12th Floor

20 Toronto Street

Toronto, Ontario

Canada, M5C 2B8

Tel: (416) 703 3751 Fax: (416) 367 3638

Registered Office

Suite 2900, 550 Burrard Street

Vancouver, British Columbia V6C 0A3 

Dublin Office

74 Haddington Road

Dublin 4, Ireland

Tel: (353) 1 667 7611 Fax: (353) 1 667 7622

Transfer Agent

Computershare Trust Company of Canada

100 University Avenue, 8th Floor

Toronto, Ontario

Canada, M5J 2YI

Exchange Listing

The Toronto Stock Exchange

AIM Market of the London Stock Exchange

Symbol: MOY

CUSIP: 62472V 100

Shares outstanding: 60,572,904

Shares fully diluted: 63,872,904

To contact the Company 

In order to contact the Company or to request to be added to our mailing list

please email info@moydow.com

website: www.moydow.com

        

    

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