TSX: AAB last: chg: delayed 15-20 min View More

Aberdeen International Reports Value of Investment Portfolio and Cash of $0.69 Per Share at the End of the Second Quarter


TORONTO, ONTARIO -- (MARKET WIRE) -- 08/18/10 -- ABERDEEN INTERNATIONAL INC. ("Aberdeen" or the "Company") (TSX: AAB) today announces that the value of its investment portfolio for the second quarter of fiscal 2011, which ended July 31, 2010, was approximately $60.0 million including a cash balance of $3.9 million. This relates to a total value of $0.69 per share and does not include the value of our gold royalties. This report of the portfolio value is not equivalent to the "Net Asset Value" or "NAV" that has been previously reported by Aberdeen as it does not include assets and liabilities of the corporation that are not treated as investments. Instead it refers only to cash, equity investments (private and public), option-type investments (e.g. warrants) and corporate debt/loans receivable. The cash total includes cash to be received from transactions awaiting settlement at the end of the quarter.

The value of the investment portfolio decreased quarter over quarter by approximately $9.7 million or 13.9%. Second quarter financial results are expected to be released by September 15, 2010, and will include up-to-date shareholders' equity value (previously referred to as "net asset value") which includes value for our royalties as well as other assets and liabilities.

(CAD millions)                  July 31, 2010 April 30, 2010  July 31, 2009
Cash and cash equivalents                 3.9            1.0            1.3
Publicly traded                          27.9           38.2           29.6
Private                                  16.2           11.3            7.8
Non-trading warrants
  Intrinsic value                         1.2            6.8            2.5
  Option value                            2.8            3.5            4.9

Portfolio Investments                    48.1           59.9           44.9

Equity accounted investment                              1.1            1.9

Corporate Debt/Loans
 receivable                               8.0            7.7            2.6

TOTAL                                    60.0           69.7           50.7

Shares Outstanding (millions)            87.5           87.5           87.5
$/Share                                  0.69           0.80           0.58

David Stein, Aberdeen's President and COO, commented, "During our second quarter we saw a significant slide in the overall equity markets and in particular the small and micro-cap stocks that make up much of our portfolio. In particular Dacha Capital was hard hit both by the overall market as well as exceptional selling introduced after its March 2010 Special Warrants became freely trading. Despite this setback, Dacha Capital has been successful in acquiring rare earth metal material and moving it outside of China where demand is growing rapidly. The market value of its holdings has been steadily rising over recent months as witnessed by its growing NAV per share."

"We are undaunted by the month-to-month fluctuations of the portfolio as we manage Aberdeen for the long-term. While many of our public holdings were weak in Q2, we made excellent progress with respect to several new core holdings such as Forbes & Manhattan Coal ("Forbes Coal"), which was financed privately in July, and Newport Mining, which is in effect a spin-out of certain assets of privately-held Amazon Potash. Our portfolio is positioned well to react positively as the resource market rebounds and particularly to improvements in sentiment with respect to the gold price, given our strong gold focus."

Highlights Of The Past Quarter

Aberdeen is excited about the expected listing of Forbes Coal, one of our private holdings that completed a $35.6 million financing in July at $2.80 per share. Prior to the financing Aberdeen held 1,100,000 seed shares, which were purchased at an average cost base of approximately $1.18 per share. In addition, Aberdeen also holds 1,100,000 performance shares which vest based on certain production and profitability milestones-these performance shares give Aberdeen tremendous additional upside provided Forbes Coal meets its operational goals. Aberdeen currently holds 1,705,196 common shares and 1,100,000 performance shares in Forbes Coal.

Amazon Potash, another of Aberdeen's private holdings which holds agricultural mineral assets in Brazil (and already spun out private company Brazil Potash previously), also reported an exciting development. Amazon Potash executed a transaction to vend its phosphate exploration and development assets to Newport Mining (NMN-ASX), an Australian listed Company. Aberdeen holds both debt and equity in Amazon Potash. Aberdeen agreed to settle part of its debt for shares and performance shares in Newport. In addition, Aberdeen received shares and performance shares for its equity holdings in Amazon Potash. Vesting of the two series of performance shares depends on the size of JORC compliant resources discovered on the phosphate properties sold to Newport, and Aberdeen expects that the drilling and subsequent resource estimates by Newport could add significant value to the portfolio both from the upside in Newport's common stock held by Aberdeen as well as the potential to vest the performance shares. Aberdeen holds 1,521,583 commons shares, 4,145,556 series A performance shares, and 3,318,763 series B performance shares of Newport Mining.

Both of these transactions demonstrate that Aberdeen's core business of investing in and nurturing early-stage resource investments with exceptional upside has been successful despite the recent ups and downs of the market. We continue to work with our investee companies to add value for Aberdeen shareholders as well as selectively reviewing and analysing new investment opportunities.

At the end of quarter, Aberdeen had purchased 75,000 shares as part of its Normal Course Issuer Bid ("NCIB") at an average cost of $0.34 per share. Since the end of the quarter Aberdeen has purchased an additional 177,500 shares for a total of 252,500 shares and all repurchased shares have been cancelled. Aberdeen expects to continue to purchase shares over the remainder of the fiscal year, depending on market conditions and other investment opportunities that may be available.


Our outlook for the remainder of the year is cautiously positive. We are entering a seasonally strong period for the gold price with a macro-economic background that remains supportive to higher gold prices. Our portfolio continues to be weighted heavily towards gold through large investments in Crocodile Gold, Avion Gold, Sulliden Gold and Belo Sun Mining, all of which are up significantly since the market lows witnessed in May-June 2010, as well as our gold royalties on two producing operations in South Africa (Buffelsfontein and Mine Waste Solutions).

We are also pleased to report the launch of Aberdeen's updated, rebranded, and modernized website at www.aberdeeninternational.ca. This is an important and long-overdue step as Aberdeen strives to improve communication with its shareholders and the investment community at large. In conjunction with its new website, Aberdeen is also making updates available on Twitter (username: AberdeenAAB), including company news, updates on the company's holdings and other relevant information relating to the company and the resource industry.

About Aberdeen International Inc:

Aberdeen is a publicly traded global investment and merchant banking company focused on small cap companies in the resource sector. Aberdeen will seek to acquire significant equity participation in pre-IPO and/or early stage public resource companies with undeveloped or undervalued high-quality resources. Aberdeen will focus on companies that: (i) are in need of managerial, technical and financial resources to realize their full potential; (ii) are undervalued in foreign capital markets; and/or (iii) operate in jurisdictions with moderate local political risk. Aberdeen will seek to provide value-added managerial and board advisory services to companies. The Corporation's intention will be to optimize the return on its investment over an 18 to 24 month investment time frame.

For additional information, please visit our website at www.aberdeeninternational.ca and follow us on Twitter: AberdeenAAB.

Cautionary Note

Except for statements of historical fact contained herein, the information in this press release constitutes "forward-looking information" within the meaning of Canadian securities law. Such forward-looking information may be identified by words such as "plans", "proposes", "estimates",

"intends", "expects", "believes", "may", "will" and include without limitation, statements regarding the impact of the appointment on Aberdeen; past success as an indicator of future success; net asset value of the Company; the potential of investee companies and the appreciation of their share price; the future intentions of the Company with regard to its shareholdings; the Company's plan of business operations; and anticipated returns. There can be no assurance that such statements will prove to be accurate; actual results and future events could differ materially from such statements. Factors that could cause actual results to differ materially include, among others, metal prices, competition, financing risks, acquisition risks, risks inherent in the mining industry, and regulatory risks. Most of these factors are outside the control of the Company. Investors are cautioned not to put undue reliance on forward-looking information. Except as otherwise required by applicable securities statutes or regulation, the Company expressly disclaims any intent or obligation to update publicly forward-looking information, whether as a result of new information, future events or otherwise.

Aberdeen International
Mike McAllister
Manager, Investor Relations
+1 416-309-2134

Aberdeen International
David Stein
President and COO
+1 416-861-5812