/NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE
UNITED STATES/
TORONTO, Aug. 6 /CNW/ - (TSX: MLY, MLY.WT) - Sprott Molybdenum
Participation Corporation (the "Corporation") is announcing its results for
the three and six months ended June 30, 2008.
The change in net assets from operations after taxes of the Corporation
in the three and six months ended June 30, 2008 was an increase of $0.09 and a
decrease of $0.07, respectively. Portfolio Investments generated a gain of
$5.9 million in the second quarter, partially offsetting losses incurred in
the first quarter. For the six months ended June 30, 2008, Portfolio
Investments provided a return of -0.90%, the net asset value per common share
appreciated by 0.66% and the value of the common stock declined by 9.73%. Net
asset value as at June 30, 2008 was $246.2 million or $6.10 per common share.
We are cognizant of the discount the Corporation's stock price is
experiencing in the market and are active in the normal course issuer bid
("NCIB") that we instituted last year. The Corporation has repurchased and
cancelled a total of 4.1 million shares to June 30, 2008, of which 3.0 million
shares were repurchased in the first two quarters of this year. The NCIB
resulted in the net asset value increase of $0.02 and $0.10 for the three and
six months ended June 30, 2008, respectively. We intend to renew the normal
course issuer bid in August of 2008. We also continue to look for creative
ways of participating in the molybdenum market.
Approximately 600,000 lbs of contained molybdenum, in form of molybdenum
oxide, generated an unrealized loss of $0.3 million in the quarter and a gain
of $0.9 million year to date, increasing in value from $19.5 million as at
December 31, 2007 to $20.4 as at June 30, 2008.
The most significant expense of the Corporation for the three and six
months ended June 30, 2008 was a management fee of $1.2 and $2.2 million,
respectively. The management fee is calculated pursuant to the management
services agreement dated April 3, 2007(1). Management fees comprised 78.2% of
the Corporation's total expenses for the quarter and 75.3% of total expenses
year to date.
Other expenses incurred in the three and six month periods ended June 30,
2008 included general and administrative expenses of $194 and $379 thousand,
respectively, capital taxes of $25 and $86 thousand, respectively, and
director compensation of $36 and $88 thousand, respectively.
"We still believe that real assets, such as energy and commodities, will
continue to outperform financial assets. We continue to be excited about the
outlook for molybdenum as the 'energy 1 A copy of the management services
agreement is available for review at www.sedar.com and www.sprottmoly.com
metal', and we are encouraged with the progress the companies in our portfolio
are making", commented Mr.