Titanium Corporation Reports First Quarter Ended
Titanium Corporation Reports First Quarter Ended March 31, 2020 and
Provides Project Update
CALGARY, Alberta, May 28, 2020 -- Titanium Corporation Inc. (the “Company” or “Titanium”) (TSX-V: TIC ) today
released its results for the three-month period ended March 31, 2020.
In the first quarter of 2020, the COVID-19 pandemic and the collapse of oil demand and prices introduced unprecedented
uncertainties for industries and economies globally. These include sectors directly related to the Company’s Creating Value
from Waste™ technology (“CVW™”) at the Canadian Natural Resources Limited (“Canadian Natural”) Horizon site (the
“Project”), including Canada’s oil sands industry, the global mineral sands industry and the Canadian economy. The duration
and the extent of the impact of these events is not known but could adversely affect the progress and timing of the Project. In
response, the Company has taken measures to protect its balance sheet by reducing costs and conserving cash over the
months ahead.
During the first quarter of 2020, the Company and Canadian Natural joint project team has continued work on the Project,
performing post-Front End Engineering Design (“FEED”) reviews and optimization of the Project as well as continuing the on-
going minerals analysis programs. In parallel, the Company has been providing updates to the Alberta and Federal government
agencies who have awarded grant funding to the Project and are working with them toward funding contracts for the detailed
engineering phase of the Project.
“During this very challenging period, our team is continuing to work with our industry partner and the government funding
agencies to advance our Project,” commented Scott Nelson, Titanium’s President and Chief Executive Officer. “As
governments plan next steps and new programs to spur economic recovery, we believe our CVW™ technology can provide
important environmental and economic benefits that will assist with the recovery of a resilient and sustainable energy industry
in Alberta and Canada.”
Certain highlights for the three-month period ended March 31, 2020 are set out in more detail below:
• The Company has been conducting technical marketing and testing programs including meeting with potential minerals
processors and customers, visiting their facilities and providing minerals samples for customer testing. These activities
have been largely suspended due to the COVID-19 pandemic and will be resumed when the relevant countries and
businesses reopen and resume normal operations.
• The Company continued to advance the contracting with government funding agencies for grant awards for the next
phase of the Project. This has included Project updates regarding the impacts of the COVID-19 pandemic and the oil
demand and price collapse. Funding from the government programs is subject to finalizing funding agreements which
will outline the conditions under which funding would be provided.
• The Company implemented salary reductions in the range of 15 to 20% effective April 1, 2020 to preserve cash in
response to the uncertainty created by the COVID-19 pandemic and the resulting delays to the Project. The Company
is also continuing its cash conservation programs including those under which management and directors receive a
portion or all of their compensation and fees in restricted share units and deferred share units (“DSUs”), respectively.
This program is aimed to conserve cash and further align management and the Board with shareholder interests. Since
the inception of the program in 2015, the Company’s directors have been receiving 100% of their compensation in DSUs
in lieu of cash compensation.
FINANCIAL OVERVIEW
Titanium is focused on achieving long-term financial success by implementing its innovative CVW™ technologies in
commercial operations at oil sands sites. With the FEED portion of the Project completed, the Company is working with
Canadian Natural on Project activities post-FEED, including engineering optimization and planning for the potential
implementation of its technology at Canadian Natural’s Horizon site. However, until Project activities post-FEED are
completed to the satisfaction of the parties, commercial arrangements and investment decisions are made, and facilities
constructed and operating, the Company expects to continue to incur losses. Currently, quarterly (income)/losses are
comprised of research and development (“R&D”) project costs, recovery of project costs, and general and administrative
(“G&A”) expenditures.
Net (Loss) Income – For the three-month period ended March 31, 2020, the Company reported net loss of $0.9 million or
$0.01 loss per share. The net loss consisted of G&A ($0.5 million) and R&D ($0.4 million) expenses in the current period
compared to net income of $0.5 million for the three-month period ended March 31, 2019 as the Company received Project
contributions for the FEED in the prior period which exceed Project costs incurred and G&A expenses. For a development
stage company and given the timing of Project contributions in the prior year, the net loss was in line with expectations.
Research & Development – R&D spending in the current quarter consisted primarily of compensation for technical staff, on-
going minerals testing and evaluations, and preliminary post-FEED optimization engineering work. Project costs were lower
by $0.1 million for the three-month period ended March 31, 2020 compared to the same period in 2019 due to the completion
of the FEED Project in the first quarter of 2019. Recovery of Project costs was nil for the three-month period ended March 31,
2020 compared to $1.5 million for the three-month period ended March 31, 2019. The recovery in 2019 related to the collection
of FEED contributions from ERA and Canadian Natural for the final FEED Project milestones. Based on the level of R&D, post-
FEED activity R&D costs were in line with expectations.
General & Administrative – G&A expenses for the three-month period ending March 31, 2020 were slightly lower at $0.53
million as compared to $0.55 million for the three-month period ended March 31, 2019. There was an increase in the quarter in
professional fees due to legal costs related to shareholder matters. This was offset by a decrease investor relations costs as
investor relations services were provided on an as-needed basis compared to a fixed retainer in the prior fiscal period.
Cash Position – The Company’s aggregate cash and short term investment position was $4.2 million as of March 31, 2020.
The Company had $2.2 million in interest-bearing cash accounts and a $2.0 million short-term investment with a Schedule I
bank in the form of a cashable GIC at March 31, 2020 as compared to $5.1 million at December 31, 2019. The decrease in
cash and short-term investments of $0.9 million is the result of funding the Company’s post-FEED Project activities, general
and administrative and public company expenditures. With the costs reduction initiatives and delayed timing of the Project, the
Company expects its current cash position will support it through the next 12-month period.
To view the Company’s management discussion and analysis and interim unaudited financial statements for the three month
period ended March 31, 2020, please visit our website at www.titaniumcorporation.com or SEDAR at www.sedar.com.
About Titanium Corporation Inc.
Titanium Corporation’s CVW™ technology provides sustainable solutions to reduce the environmental footprint of the oil
sands industry. Our technology reduces the environmental impact of oil sands froth treatment tailings while economically
recovering valuable products that would otherwise be lost. CVW™ recovers bitumen, solvents, heavy minerals and water from
tailings, preventing these commodities from entering tailings ponds and the atmosphere: volatile organic compound and
greenhouse gas emissions are materially reduced; hot tailings water is improved in quality for recycling; and residual tailings
can be thickened more readily. A new minerals industry would be created commencing with the production and export of
zircon, an essential ingredient in ceramics. The Company’s shares trade on the TSX-V under the symbol “TIC”. For more
information please visit the Company’s website at www.titaniumcorporation.com.
Disclosure regarding forward-looking information
This news release contains forward-looking statements and information within the meaning of applicable Canadian securities
laws (collectively, " forward-looking information ") that reflect the current expectations of management about the future
results, performance, achievements, prospects or opportunities for Titanium, including statements relating to the occurrence
and timing of future steps with respect to the CVW™ Horizon Project, including the Project activities post-FEED and the
factors that are expected to affect such occurrence and timing; the continued effective collaboration between the Company
and Canadian Natural; the Company's ongoing engagement with its business partners and government funding agencies; the
Company's continuing cash conservation program and expectations regarding the Company's current cash position; the
Company's ongoing evaluation of financing opportunities, including grant and financing opportunities from applicable
government programs; and the advantages of the Company's technology in assisting with the recovery of the energy industry in
Alberta and Canada. This forward-looking information generally can be identified by use of forward-looking words such as
"may", "will", "expect", "estimate", "anticipate", "believe", "project", "should" or "continue" or the negative thereof or similar
variations.
Forward-looking information is presented in this news release for the purpose of assisting investors and others in
understanding certain key elements of our financial results and business plan, as well as our objectives, strategic priorities
and business outlook, and in obtaining a better understanding of our anticipated operating environment. Readers are
cautioned that such forward-looking information may not be appropriate for other purposes.
Forward-looking information, by its very nature, is subject to inherent risks and uncertainties and is based on many
assumptions, both general and specific, which give rise to the possibility that actual results or events could differ materially
from our expectations expressed in or implied by such forward-looking information and that our business outlook, objectives,
plans and strategic priorities may not be achieved. Macro-economic conditions, including public health concerns (including
the impact of the COVID-19 pandemic) and other geopolitical risks, the condition of the global economy and, specifically, the
condition of the crude oil and natural gas industry including the collapse of global crude oil demand and prices and other
commodity prices and demand in 2020, and the ongoing volatility in world markets may adversely impact oil sands producers'
program plans, including proceeding with an investment decision in further Project activities post-FEED or any final investment
decision with respect to commercialization, which could materially adversely impact the Company. In addition to other factors
and assumptions which may be identified in this news release, assumptions have been made regarding, among other things:
the condition of the global economy, including trade, public health (including the impact of the COVID-19 pandemic) and other
geopolitical risks, including the fact that any estimates of Project next steps post-FEED , as well as the detailed engineering
and construction period may be affected by the COVID-19 pandemic, condition of the global economy and commodity prices,
in particular crude oil prices; the stability of the economic and political environment in which the Company operates; the
success of the Project activities post-FEED, including the expected assessment of post-FEED engineering reviews for next
steps as part of the Project activities post-FEED; the ability of the Company to enter into commercial contracts with oil sands
producers and to achieve commercialization of the CVW™ technology, including the anticipated scope of such commercial
contracts; the ability of the Company to enter into commercial contracts with other strategic partners in relation to building and
operating facilities, as required; the ability of the Company to continue with its cost reduction initiatives and to be supported
by its current cash position; the ability of the Company to retain qualified staff; the ability of the Company to obtain financing
on acceptable terms, including available grant and financing opportunities from government programs and finalizing funding
agreements for such government programs; the translation of the results from the Company's research, pilot programs,
Project activities during the FEED, Project activities post-FEED and studies into the results expected on a commercial scale;
the belief that the Company's technology will provide important environmental and economic benefits that will assist with the
recovery of a resilient and sustainable energy industry in Alberta and Canada; the anticipated timing for the completion of
detailed engineering and construction once all Project activities post-FEED are completed and a final decision to proceed has
been made; future crude oil and zircon prices and the impact of lower prices on activity levels and cost savings of oil sands
producers; the impact of increasing competition; the ability to protect and maintain the Company's intellectual property;
currency, exchange and interest rates; the regulatory framework regarding royalties, taxes and environmental matters in the
jurisdictions in which the Company operates; and the ability of the Company to successfully market its CVW™ technology.
The Company has not commercially demonstrated its technologies and there can be no assurance that our research, pilot
programs, Project activities during the FEED, Project activities post-FEED and related studies will prove to be accurate nor
that such commercialization efforts will be successful, as actual results and future events could differ materially from those
expected or estimated in such forward-looking information. As a result, we cannot guarantee that any forward-looking
information will materialize and we caution you against relying on any of this forward-looking information. Accordingly, readers
should not place undue reliance on forward-looking information.
Additional information on these and other factors are disclosed in our most recently filed management's discussion and
analysis, including under the heading “Discussion of Risks”, and in other reports filed with the securities regulatory authorities
in Canada from time to time and available on SEDAR (sedar.com).
The forward-looking information contained in this news release describes our expectations as of May 28, 2020 and,
accordingly, is subject to change after such date. Except as may be required by Canadian securities laws, we do not
undertake any obligation to update or revise any forward-looking information contained in this news release, whether as a
result of new information, future events or otherwise.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
For further information, contact:
Scott Nelson
President & CEO
Tel: (403) 561-0439
Email: [email protected]
Jennifer Kaufield
Vice President Finance & CFO
Tel: (403) 874-9498