2019 Annual Report (2) Update ON Delay IN Publication of Q1 and Q2 2020 Financial Results (3) Business Update
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August 12, 2020
(1) UPDATE ON DELAY IN PUBLICATION OF
2019 AUDITED ANNUAL RESULTS AND DESPATCH OF
2019 ANNUAL REPORT
(2) UPDATE ON DELAY IN PUBLICATION OF Q1 AND Q2
2020 FINANCIAL RESULTS
(3) BUSINESS UPDATE
VANCOUVER – SouthGobi Resources Ltd. (TSX: SGQ, HK: 1878) (“SouthGobi” or the
“Company”) announces that reference is made to the announcements of the Company dated
June 21, 2020, June 30, 2020 and July 24 , 2020 (collectively, the “ Announcements”) in
relation to the delay in publication of the 2019 Audited Annual Results and the despatch of the
2019 Annual Report. Unless otherwise stated herein, capitalized terms used herein shall have
the same meanings as that ascribed to them in the Announcements.
Delay in Publication of 2019 Audited Annual Results and Despatch of 2019 Annual
Report
In its announcement dated July 24, 2020, the Company disclosed that it expected to be in a
position to issue its 2019 Audited Annual Results and 2019 Annual Report by August 14, 2020,
provided the following assumptions hold true: (i) the Company concludes written settlement
agreements with each of the key creditors that has provided a verbal commitment to the
Company to do so on or before July 30, 2020; and (ii) the Company and its major shareholder
conclude an agreement on an avenue of support for the Company that the Auditors consider
as acceptable evidence to support the Company’s going concern assumptions.
As of the date hereof, the Company has not entered into a written settlement agreement with
one of the aforementioned key creditors and has not reached an agreement with its major
shareholder in relation to an avenue of support that is acceptable to the Auditors. Accordingly,
the Company will be unable to issue the 2019 Audited Annual Results and 2019 Annual Report
by August 14, 2020 as previously anticipated.
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The Company continues to work close ly with the Auditors and provide them with audit
evidence to support the going concern assumptions for the Company’s 2019 Financial
Statements in order to issue the 2019 Audited Annual Results at the earliest possible date.
Delay in Publication of 2020 Q1 Financial Results
The filing deadline for the Company’s 2020 Q1 financial results for the quarter ended March
31, 2020 (“ 2020 Q1 Financial Results ”) was May 15, 2020 as required under applicable
Canadian securities laws. However, the Company cannot issue its 2020 Q1 Financial Results
until it first issues its 2019 Audited Annual Results. Currently, the 2020 Q1 Financial Results
have not been revie wed by the Auditors. If and when the 2019 Audited Annual Results are
issued, the Company expects that it will take approximately 30 days from the date of issuance
of the 2019 Audited Annual Results for the Auditors to complete the review of, and the
Company to issue, the 2020 Q1 Financial Results.
Delay in Publication of 2020 Q2 Financial Results
The filing deadline for the Company’s 2020 Q2 financial results for the quarter ended June 30,
2020 (“ 2020 Q2 Financial Results ”) is August 14, 2020 as required under applicable
Canadian securities laws and is August 31, 2020 as required under Hong Kong Listing Rules
respectively. However, the Company cannot issue its 202 0 Q2 Financial Results until it first
issues its 2019 Audited Annual Results. Currently, the 2020 Q2 Financial Results have not
been finalized and have not been r eviewed by the Auditors. If and when the 2019 Audited
Annual Results and the 2020 Q1 Financial Results are released, the Company expects that it
will take approximately 30 days from the date of issuance of the 2020 Q1 Financial Results
for the Auditors to complete the review of, and the Company to issue, the 2020 Q2 Financial
Results.
Cease Trade Order
The BCSC issued the CTO against the Company on June 19, 2020 as a result of the
Company’s failure to file the Comp any’s 2019 Financial Statements and 2020 Q 1 interim
financial statements, and the related management’s discussion and analysis and
management certifications related thereto. The Company expects the CTO will remain i n
place until such time as the Company’s 2019 Financial Statements, 2020 Q1 interim financial
statements and 2020 Q2 interim financial statements are filed . The Company continues to
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work closely with the Auditors to provide them with audit evidence to support the going concern
assumptions for the Company’s 2019 Financial Statements, and to issue the 2019 Audited
Annual Results, 2020 Q1 Financial Results 2020 Q2 Financial Results at the earliest possible
dates.
Business Update
The Company’s sales volume in July 2020 was approximately 0.25 million tonne, representing
a 16 % increase from sales volume in June 2020. The Company has resumed the mining
operation since August 2, 2020.
DUE TO THE AFOREMENTIONED DELAY IN PUBLICATION OF 2019 AUDITED ANNUAL
RESULTS, THE COMPANY WILL APPLY FOR A TRADING SUSPENSION FROM THE
HONG KONG STOCK EXCHANGE, EFFECTIVE FROM 9AM ON AUGUST 17, 2020,
PENDING FOR PUBLICATION OF 2019 AUDITED ANNUAL RESULTS.
SHAREHOLDERS AND POTENTIAL INVESTORS OF THE COMPANY SHOULD
EXERCISE CAUTION WHEN THEY DEAL OR CONTEMPLATE DEALING IN THE
COMPANY’S SHARES OR OTHER SECURITIES OF THE COMPANY.
The Company will make further announcement(s) in relation to the above matters, as and
when appropriate. If there is any inconsistency or discrepancy between the English version
and the Chinese version, the English version shall prevail.
About SouthGobi
SouthGobi, listed on the Toronto and Hong Kong stock exchanges, owns and operates its
flagship Ovoot Tolgoi coal mine in Mongolia. SouthGobi produces and sells coal to customers
in China.
Contact:
Investor Relations
Office: +852 2156 1438 (Hong Kong)
+1 604 762 6783 (Canada)
Email: [email protected]
Website: www.southgobi.com