ATLANTA, Dec. 20, 2010 (GLOBE NEWSWIRE) -- Dutch Gold Resources, Inc. (Pink Sheets:DGRI) (the "Company") ( http://dutchgold.com ) today provided the following update to shareholders discussing recent progress as well as its outlook for 2011.
As many would expect, 2010 was a challenging year. Despite rising gold prices, a difficult economic environment fueled by the banking crisis made the financing of small companies difficult. Having now successfully weathered this storm, we believe the Company is well positioned for growth going into 2011. We have made substantial progress on last year's goals of increasing the mining resources base, improving the Company's balance sheet and cash position, strengthening the management team, and improving transparency, and are looking forward to 2011.
During mid-2009, the Company previously stated the objective to grow its resource base to 10 million ounces of gold. Despite management having elected to discontinue the lease on the project on the Benton Mine, the Company still has recognized a fourteen-fold increase in reserves under management, increasing the resource we control to approximately 7.5 Million ounces during 2010. This does not currently account for any resources associated with the Company's Jungo holding.
2010 was a year of significant corporate activity for Dutch Gold. The Company successfully acquired a controlling interest in Aultra Gold, Inc., (AGDI). After repositioning the properties in Aultra Gold to Dutch Gold, the Company entered into a change of control transaction with Shamika 2 Gold, Inc., (Shamika) resulting in Dutch Gold retaining 4,950,000 million shares of Shamika. Shamika maintains significant resource holdings in the Democratic Republic of the Congo. The Company continues to hold its Shamika shares in anticipation that there will be further development in the Democratic Republic of the Congo as well as other potential future resource acquisitions.
As a significant shareholder in Shamika, Dutch Gold looks forward to the publication of NI 43-101 compliant reports on their holdings. As evidenced by recent news on the company, they have recently added several important projects to its holdings as well as retaining the talents of Mr. Clement de la Forge as Chief Operating Officer, a world-class manager with extensive experience and relationships around the globe. It should not be lost on our own shareholders that with Shamika's success, comes potentially non-dilutive financial resources and options previously not possessed by the Company at the beginning of 2010.
While in 2010, the company's balance sheet could be considered to have needed strengthening, with approximate assets valued at $295,919.00 and cash of only $25,845.00, the Company anticipates its year end balance sheet to look much different. The company currently anticipates closing the year with approximately a fifteen-fold increase in cash, and a twelve-fold increase in current assets. Current assets measure the ability of the Company to react quickly, and to advance its projects over time, an important indicator for any resource company. The Shamika shares, which have only recently begun to show liquidity, have become an important part of Dutch Gold's treasury with current market prices representing approximately $3,000,000.
The Company has also been aggressively focused on the elimination of debt and other financial exposures. To that end, the Company has completed a reclamation plan at the Benton Mine in Oregon, capping any ongoing potential liability on the discontinued operation. Additionally, the Company has resolved a substantial portion of its accounts payable and other note liabilities. The balance sheet is much stronger which has the potential to facilitate lower financing costs in the future. Dutch Gold clearly now has a much more solid foundation from which to execute its business plan in 2011
Shareholders have expressed interest regarding the number of shares that are outstanding in the Company. As of December 1, 2010, there were 298,306,737 shares outstanding. In the two months following our last report on September 30, 2010, the Company issued shares for consultants and managers, and the liquidation over eight hundred thousand dollars ($800,000) of debt. During that same period, the number of shares available in the "float" grew to approximately 150M shares as legacy shareholders and others recognized the significant increase in liquidity during the month of November, many of whom had held restricted stock for over three years. At the time of authorship of this communications, there is a possibility for additional debt conversion although amounts available for conversion are greatly diminished, likely reducing dilution in the near term.
With respect to corporate transparency, management is pleased to restate that during 2010, the Company successfully brought current all of its filings with the Securities and Exchange Commission. Currently new policies and procedures have been put in place in anticipation of filing for additional trading platforms during 2011. With this in mind, the company has submitted a 15C-211 to a sponsoring broker dealer for application to the OTC Bulletin Board. During the New Year, the Company anticipates enhancing its corporate governance, adding two additional outside Board Members, establishing both Compensation and Audit committees, consistent with the standards of NYSE-Amex.
With respect to questions regarding access to Corporate Stock Transfer, the Company's transfer agent, by business practice, our transfer agent refers all calls regarding the Company to management. The procedure was in place third quarter 2010, and the policy will remain in place. The Company will update its data and its capital structure on www.OTCMarkets.com on a quarterly basis as well as the Company's website on the 10th of each month, beginning January 2011.
The Company is specifically pleased with the quality additions to the management team during 2010. Rauno Perttu is a world-class geologist. The Company believes his expertise will prove invaluable as it begins to add value to its current portfolio through potential new acquisitions. Steve Keaveney, the Company's Chief Financial Officer has an outstanding record of mergers and acquisitions work and should prove invaluable as the business progresses. In 2011, we expect to continue to add to the management team while building out the operations side of the business.
Frequently, the Company is asked to comment on the state of the gold market. Dutch Gold is governed by two main principles. First, the gold sector is volatile. While we continue to hold to the belief that we are in a secular bull market, we expect that there will be corrections in the spot market. We would not be surprised to see gold retrace to the $1,250 ounce range, for a brief period. Long term, we believe that the momentum is upward, but we caution that there will be dips. The commodities markets have never been for the faint of heart; the volatility can be ferocious. We maintain, however, that the trend line should remain positive in the near term. The second principle that we hold is that, once you have discovered and developed a project, containing costs becomes all-important. Our goal is to produce positive cash flow. At $1,250 per ounce, we predict a reasonable profit on our current holdings. If the price of gold continues to rise, we expect to generate additional cash flow, for reinvestment, additional acquisitions, or dividends.
As the Company looks forward to 2011, there will continue to be four main themes to its activities. First, we commit again to resource growth in 2011, both organically in our existing projects like Basin Gulch, and through acquisitions. Second, we remain committed to building a strong balance sheet. We anticipate that a stronger balance sheet, combined with better financial resources will allow us to capitalize on opportunities we missed during 2010. Some potential transactions, although successfully negotiated, were unable to close due to cash constraints. Third, we maintain the best way to attract world-class projects and lower cost financing is to build a world-class team. Rauno Perttu and I are committed to finding the best people to help build a company of which you can be proud.
Finally, our vision is to improve the Company to the point where Dutch Gold Resources, Inc., can be listed on NYSE-Amex and the Toronto Stock Exchange. Although we are keenly aware that there remains a great deal of hard work ahead of us, we continue to set our sights on building an institutional quality company and creating long term sustainable shareholder value.
About Dutch Gold Resources:
Dutch Gold Resources, Inc. is engaged in the production and development of gold reserves in North America. The company's strategy is to focus on overlooked resources that can be quickly and cost-efficiently brought into production, and to seek out potentially significant exploration targets in high value geographies. The Basin Gulch project Montana, the Jungo property outside Winnemucca, Nevada, and the Gold Bug Mine in Oregon comprise the Company's current portfolio. The DGRI management team is composed of seasoned professionals with decades of experience in geology, and in mergers and acquisitions, as well as corporate finance.
This press release contains forward-looking statements that reflect the Company's current expectation regarding future events. Actual events could differ materially and substantially from those projected herein and depend on a number of factors. Certain statements in this release, and other written or oral statements made by Dutch Gold Resources, Inc. are "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. You should not place undue reliance on forward-looking statements since they involve known and unknown risks, uncertainties and other factors, which are, in some cases, beyond the Company's control and which could, and likely will, materially affect actual results, levels of activity, performance or achievements. The Company assumes no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future. Important factors that could cause actual results to differ materially from the company's expectations include, but are not limited to, those factors that are disclosed under the heading "Risk Factors" and elsewhere in documents filed by the company from time to time with the United States Securities and Exchange Commission and other regulatory authorities.
For further information, please see or please contact Steve Keaveney at Dutch Gold Resources, Inc. at (404) 419-2440.
CONTACT: Dutch Gold Resources, Inc. Steve Keaveney (404) 419-2440 www.DutchGold.com Lippert Heilshorn & Associates, Inc. Investor Relations Contact Jody Burfening (212) 838-3777 email@example.com