Novo Resources Narrows Nine-Month Loss to CAD 9.7M, Cuts Cash Burn
Novo Resources Corp. reported a reduced net loss of CAD 9.7 million for the nine months to September 2025, supported by lower operating cash outflows and a significant post-period sale of San Cristobel Mining shares. The company maintains a cautious outlook amid ongoing funding needs.
- Net loss narrowed to CAD 9.7 million from CAD 17.9 million year-on-year
- Operating cash outflows decreased to CAD 8.45 million
- Cash and short-term investments stood at CAD 2.4 million at period end
- Post-period sale of San Cristobel Mining shares generated USD 6.4 million
- Deferred consideration renegotiated with repayment extended to 2026
Financial Performance and Cash Flow
In its latest unaudited interim financial statements for the nine months ended September 30, 2025, Novo Resources Corp. reported a net loss of CAD 9.7 million, a marked improvement from the CAD 17.9 million loss recorded in the same period last year. This reduction was accompanied by a decline in operating cash outflows to CAD 8.45 million, reflecting tighter cost controls and a more disciplined approach to exploration and administration expenses.
Despite the loss, the company ended the period with CAD 2.4 million in cash and short-term investments, a modest buffer as it navigates ongoing operational and financial challenges.
Asset Portfolio and Strategic Disposals
Novo holds a substantial portfolio of exploration and evaluation assets primarily focused on gold and copper projects in Australia and Canada. Notably, some assets have been classified as held for sale, signaling a strategic effort to unlock liquidity. This was underscored by a significant post-period transaction in October 2025, where Novo sold 400,000 shares in San Cristobel Mining Inc. for gross proceeds of USD 6.4 million (approximately CAD 8.9 million), bolstering its cash position.
The company also recognized impairment charges related to relinquished tenements and revaluations of assets held for sale, reflecting a pragmatic reassessment of its exploration portfolio in a challenging market environment.
Liabilities and Deferred Consideration
On the liabilities front, Novo continues to manage a deferred consideration balance stemming from its 2020 acquisition of Millennium Minerals Pty Ltd. The repayment terms were renegotiated in late 2023, extending the repayment horizon to December 2026 with provisions for early repayment discounts. As of September 30, 2025, the outstanding balance stood at approximately CAD 9.4 million, including accrued interest.
This structured approach to managing legacy obligations provides some financial flexibility but also underscores the importance of Novo’s liquidity management going forward.
Going Concern and Outlook
The board affirms the appropriateness of the going concern basis for these financial statements, supported by a cash flow forecast that assumes disciplined expenditure, potential joint ventures, and further asset disposals. However, the directors acknowledge material uncertainty given the company’s funding requirements and the inherent risks in exploration activities.
Shareholders should note that no new shares were issued during the period, and while stock options and warrants remain outstanding, they are currently antidilutive due to the company’s loss position.
Looking ahead, Novo’s ability to secure additional funding or successfully monetize assets will be critical to sustaining its exploration programs and advancing its project pipeline.
Bottom Line?
Novo Resources’ improved financials and strategic asset sales provide breathing room, but funding challenges remain a key watchpoint.
Questions in the middle?
- Will Novo secure additional funding or joint venture partners to advance its projects?
- How will fluctuations in marketable securities valuations impact Novo’s equity and liquidity?
- What are the prospects and timelines for monetizing other assets classified as held for sale?
