EX-99.3 4 ex99_3.htm EXHIBIT 99.3 Exhibit 99.3
CORAL GOLD RESOURCES LTD.
Consolidated Balance Sheets
(Prepared by Management)
 
 
  
July 31, 2006
  
January 31, 2006
  
ASSETS
          
           
Current
          
Cash and cash equivalents
  
$
3,974,850
  
$
663,071
  
Advances receivable (note 7(b))
    
71,854
    
62,358
  
Interest receivable
    
12,585
    
-
  
Prepaid expenses
    
81,417
    
69,856
  
               
     
4,140,706
    
795,285
  
               
Investment securities 
    
147,408
    
147,408
  
Loan receivable (note 7(f))
    
83,000
    
83,000
  
Equipment
   
3,272
    
3,634
  
Mineral properties (note 5)
    
10,632,985
    
10,095,609
  
Reclamation deposit
   
263,182
    
260,976
  
               
 
  
$
15,270,553
  
$
11,385,912
  
               
LIABILITIES
              
               
Current
              
Accounts payable and accrued liabilities (note 7(d))
  
$
390,902
  
$
696,810
  
Advances payable (note 7(c))
    
46,037
    
61,956
  
               
 
    
436,939
    
758,766
  
               
Site restoration obligation
   
16,000
    
16,000
  
               
Future income tax liability
   
1,448,662
    
1,448,662
  
               
Non-controlling interest
    
10,317
    
10,320
  
               
SHAREHOLDERS' EQUITY
              
               
Subscriptions received in advance
   
-
    
60,000
  
Share capital (note 6)
    
36,413,491
    
31,560,337
  
Contributed surplus
   
1,428,173
    
1,428,173
  
Deficit
    
(24,483,029
)
  
(23,896,346
)
               
 
    
13,358,635
    
9,152,164
  
               
 
  
$
15,270,553
  
$
11,385,912
  

NOTE 1 - NATURE OF OPERATIONS

Approved by the Directors:

“Louis Wolfin”
  
Director
  
“Gary Robertson”
  
Director
 
 
 
 
 
 
CORAL GOLD RESOURCES LTD.
Consolidated Interim Statements of Operations and Deficit
(Unaudited - Prepared by Management)

   
Three Months ended July 31,
  
Six Months ended July 31,
  
 
  
2006
  
2005
  
2006
  
2005
  
Revenue
                  
Interest income
  
$
43,930
  
$
2,461
  
$
70,968
  
$
5,897
  
                           
Expenses
                          
Amortization
    
181
    
159
    
362
    
443
  
Consulting fees
    
57,500
    
10,020
    
92,300
    
20,020
  
Directors fees
    
-
    
-
    
50,000
    
-
  
Investor relations and shareholder information
    
53,669
    
23,089
    
69,072
    
39,426
  
Legal and accounting
    
188,356
    
14,922
    
225,468
    
51,612
  
Listing and filing fees
    
2,440
    
4,381
    
31,411
    
7,581
  
Management fees
    
32,800
    
22,500
    
60,475
    
45,000
  
Office and miscellaneous
    
18,458
    
17,137
    
40,227
    
34,921
  
Salaries and benefits
    
18,071
    
25,614
    
37,203
    
49,735
  
Stock-based compensation
    
-
    
-
    
-
    
36,400
  
Transfer agent fees
    
6,844
    
3,136
    
10,544
    
4,890
  
Travel
    
27,325
    
17,498
    
38,643
    
39,415
  
                           
 
    
405,644
    
138,456
    
655,705
    
329,443
  
                           
Operating loss
    
(361,714
)
  
(135,995
)
  
(584,737
)
  
(323,546
)
                           
Other items
                          
Recovery of bad debt
    
3,464
    
-
    
3,464
    
-
  
Foreign exchange gain (loss)
    
(4,897
)
  
(13,822
)
  
(5,413
)
  
(6,740
)
                           
Loss for the period before non-controlling interest
  
$
(363,147
)
$
(149,817
)
$
(586,686
)
$
(330,286
)
                           
Non-controlling interest gain
    
-
    
-
    
3
    
-
  
                           
Loss for the period
    
(363,147
)
  
(149,817
)
  
(586,683
)
  
(330,286
)
                           
Deficit, beginning of period
    
(24,119,882
)
  
(20,691,341
)
  
(23,896,346
)
  
(20,510,872
)
                           
Deficit, end of period
  
$
(24,483,029
)
$
(20,841,158
)
$
(24,483,029
)
$
(20,841,158
)
                           
Loss per share
  
$
(0.05
)
$
(0.03
)
$
(0.09
)
$
(0.07
)
                           
Weighted average number of common shares outstanding
    
6,719,932
    
4,651,155
    
6,425,173
    
4,650,030
  

 
 
 
 
 
CORAL GOLD RESOURCES LTD.
Consolidated Interim Statements of Cash Flows
(Unaudited - Prepared by Management)
 
   
Three Months Ended July 31,
  
Six Months Ended July 31,
  
 
  
2006
  
2005
  
2006
  
2005
  
Cash flows from (used in) operating activities
                          
 
                          
Loss for the year
  
$
(363,147
)
$
(149,817
)
$
(586,683
)
$
(330,286
)
Adjustments for items not involving cash:
                          
- amortization
    
181
    
159
    
362
    
443
  
- stock based compensation
    
-
    
-
    
-
    
36,400
  
- non-controlling interest
    
-
    
-
    
(3
)
  
-
  
                   
     
(362,966
)
  
(149,658
)
  
(586,324
)
  
(293,443
)
                           
Change in non-cash working capital:
                          
- increase (decrease) in advances receivable
    
(19,172
)
  
(7,779
)
  
(9,496
)
  
4,378
  
- increase (decrease) prepaid expenses
    
(3,370
)
  
(18,457
)
  
(11,561
)
  
(15,090
)
- (increase) decrease in share subscription receivable
    
-
    
11,000
    
-
    
11,945
  
- increase (decrease) in accounts payable and accrued liabilities
    
17,289
    
59,673
    
(305,908
)
  
51,220
  
- decrease (increase) in advances payable
    
(34,692
)
  
(363
)
  
(15,919
)
  
(6,305
)
- increase (decrease) in subscriptions received in advance
    
-
    
-
    
(60,000
)
  
-
  
                           
 
    
(402,911
)
  
(105,584
)
  
(989,208
)
  
(247,295
)
                           
Cash flows from (used in) investing activities
                          
Mineral properties acquisition and exploration expenditures incurred
    
(413,977
)
  
(206,753
)
  
(537,376
)
  
(285,811
)
Interest receivable
    
(12,585
)
  
-
    
(12,585
)
  
-
  
Loan receivable
    
-
    
-
    
-
    
(33,000
)
Decrease (increase) in reclamation deposit amounts
    
(2,206
)
  
12,702
    
(2,206
)
  
5,315
  
                           
 
    
(428,768
)
  
(194,051
)
  
(552,167
)
  
(313,496
)
                           
Cash flows from financing activities
                          
Issuance of shares for cash, net
    
192,749
    
900
    
4,853,154
    
900
  
                           
Net increase (decrease) in cash and cash equivalents
    
(638,930
)
  
(298,735
)
  
3,311,779
    
(559,891
)
                           
Cash and cash equivalents, beginning of period
    
4,613,780
    
1,210,990
    
663,071
    
1,472,146
  
                           
Cash and cash equivalents, end of period
  
$
3,974,850
  
$
912,255
  
$
3,974,850
  
$
912,255
  
 
 
 
 
 
 
CORAL GOLD RESOURCES LTD.
Notes to Consolidated Interim Financial Statements
July 31, 2006
(Unaudited - Prepared by Management)
1.    Nature of Operations

These consolidated financial statements have been prepared on a going-concern basis, which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business in the foreseeable future. The Company is in the process of exploring its mineral interests and has not yet determined whether these properties contain ore reserves that are economically recoverable. The continued operations of the Company and the recoverability of mineral property costs is dependent upon the discovery of economically recoverable mineral reserves, the ability of the Company to obtain necessary financing to complete the development and upon future profitable production. Management’s plan in this regard is to raise equity financing as required.
 
2.    Basis of Presentation

These unaudited interim financial statements have been prepared in accordance with the instructions for the preparation of such financial statements contained in the CICA Handbook Section 1751. Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such instructions. These unaudited interim financial statements should be read in conjunction with the audited financial statements and accompanying notes thereto for the fiscal year ended January 31, 2006. These interim financial statements have not been reviewed by an auditor.

In the opinion of the Company’s management, all adjustments considered necessary for a fair presentation of these unaudited financial statements have been included and all such adjustments are of a normal recurring nature. Operating results for the six month period ended July 31, 2006 is not necessarily indicative of the results that can be expected for the year ended January 31, 2007.
 
3.    Basis of Consolidation 

These consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries, Coral Resources, Inc. and Coral Energy Corporation of California and its 98.49% owned subsidiary Marcus. Significant inter-company accounts and transactions have been eliminated.
 
4.    Comparative Figures 

Certain of the comparative figures for 2005 have been reclassified, where applicable, to conform to the presentation adopted for the current year.


 
 
 
 
 
CORAL GOLD RESOURCES LTD.
Notes to Consolidated Interim Financial Statements
July 31, 2006
(Unaudited - Prepared by Management)
5.    Mineral Properties 

The following is a summary of mineral property expenditures for the six months ended July 31, 2006:

Balance, beginning of period
        
$
10,095,609
  
               
Robertson Property
              
Assays
  
$
48,950
        
Consulting
    
172,140
        
Drilling
    
240,671
        
Field supplies and other
    
4,999
        
Lease payments
    
53,300
        
Reclamation
    
9,376
        
Water analysis
    
481
        
Total expenditures for Robertson Property
          
537,376
  
               
Balance, end of period
        
$
10,632,985
  


6.    Share Capital

(a)    Authorized Unlimited common shares without par value

(b)   
Issued

   
2006
  
2005
  
   
Shares
  
Amount
  
Shares
  
Amount
  
Balance, January 31,
    
5,106,266
  
$
31,560,337
    
4,648,905
  
$
30,754,678
  
                           
Private placements
    
1,500,000
    
4,500,000
    
-
    
-
  
Exercise of warrants
    
58,212
    
160,064
    
-
    
-
  
Exercise of stock options
    
14,500
    
28,350
    
-
    
-
  
Warrants returned to treasury
    
(2,000
)
  
(11,000
)
  
-
    
-
  
Share issuance costs
    
-
    
(17,009
)
  
-
    
-
  
                           
Balance, April 30,
    
6,676,978
  
$
36,220,742
    
4,648,905
  
$
30,754,678
  
                           
Exercise of warrants
    
67,232
    
173,624
    
-
    
-
  
Exercise of stock options
    
11,250
    
19,125
    
7,000
    
11,900
  
Cancelled shares
    
-
    
-
    
(2,500
)
  
(11,000
)
                           
Balance, July 31,
    
6,755,460
  
$
36,413,491
    
4,653,405
  
$
30,755,578
  


 
 
 
 
 
CORAL GOLD RESOURCES LTD.
Notes to Consolidated Interim Financial Statements
July 31, 2006
(Unaudited - Prepared by Management)
6.    Share Capital (continued)

(c)    
Share Purchase Warrants

A summary of share purchase warrants transactions for the year to date is as follows:

   
Number of
Underlying Shares
  
Balance, January 31, 2006
    
1,115,698
  
Granted
    
-
  
Exercised
    
(58,212
)
Returned to treasury
    
2,000
  
Expired
    
(252,720
)
         
Balance, April 30, 2006
    
806,766
  
Granted
    
-
  
Exercised
    
(67,232
)
         
Balance, July 31, 2006
    
739,534
  


As at July 31, 2006, the following share purchase warrants were outstanding:

Number of Underlying Shares
Exercise Price
Expiry Date
333,900
$3.10
October 12, 2006
192,500
$3.60
November 17, 2006
100,000
$3.90
December 19, 2006
113,134
$2.00
September 15, 2007
 
 
 
739,534
 
 
     


 
(d)
Stock Options

During the six months ended July 31, 2006, there were no stock options granted by the Company.
 
 
 
 
 
 
CORAL GOLD RESOURCES LTD.
Notes to Consolidated Interim Financial Statements
July 31, 2006
(Unaudited - Prepared by Management)
6.    Share Capital (continued)

(d)    Stock Options (continued)

A summary of the stock options granted and exercised at the period ended July 31, 2006 is as follows:

   
Number of Options
  
Weighted Average Exercise Price
  
           
Balance, January 31, 2006
    
697,900
  
$
2.67
  
Exercised
    
(14,500
)
$
1.96
  
               
Balance, April 30, 2006
    
683,400
  
$
2.68
  
Exercised
    
(11,250
)
$
1.70
  
               
Balance, July 31, 2006
    
672,150
  
$
2.70
  


A summary of stock options outstanding and exercisable at the period ended July 31, 2006 is as follows:

Exercise Price
Number Outstanding
Weighted Average Remaining Contractual Life (yr)
Weighted Average Exercise Price
$1.70
309,150
3.37
$1.70
$3.55
363,000
4.37
$3.55


7.  Related Party Transactions

Related party transactions not disclosed elsewhere in these statements are as follows:

a)    
During the six months ended July 31, 2006, the Company paid, or made provision for the future payment, of the following amounts to related parties:

i)    
$58,281 (2005 - $92,006) for administrative expenses to a private Company beneficially owned by the Company and a number of other public companies related through common Directors;

ii)    
$45,000 (2005 - $45,000) to a private company controlled by a Director for management fees;

iii)    
$15,000 (2005 - $15,000) in consulting fees to a private company owned by a Director; and

iv)    
$50,000 (2005 - $nil) in directors fees to directors of the Company.


1
 
 
 
 
CORAL GOLD RESOURCES LTD.
Notes to Consolidated Interim Financial Statements
July 31, 2006
(Unaudited - Prepared by Management)
7.    Related Party Transactions (continued)

b)    
Included in advances receivable are amounts due from related parties, as well as third party receivables. These amounts due from related parties include $28,003 (2005 - $28,003) due from a joint venture with common management and common directors; $1,414 (2005 - $nil) due from a company controlled by a Director and $13,124 (2005 - $31,427) due from a public company with common management and common directors.

c)    
Advances payable include $17,000 (2005 - $19,333) due to Directors in regards to past directors’ fees; $22,676 (2005 - $32,540) due to the private company that provides administrative services as disclosed in note 7(a)(i) above; $5,325 (2005 - $nil) to an officer of the Company in regards to management fees and $1,036 (2005 - $nil) due to a private company controlled by a Director of the Company for expense reimbursements.

d)    
Of the $525,000 included in accounts payable and accrued liabilities as at January 31, 2006 and payable to a director of the Company, $300,000 has been paid to the director in the six month period ending July 31, 2006. The balance still owing and included in accounts payable and accrued liabilities as of July 31, 2006 is $225,000.

e)    
The loan receivable of $83,000 (2005 - $83,000) is due from a subsidiary of a related company with common management that provides drilling services. The amount due is non-interest bearing, unsecured and due on demand.

These transactions are in the normal course of operations and are measured at the exchange amount, which is the consideration established and agreed to by the related parties, unless otherwise noted.

8.    Commitments

The Company entered into a cost-sharing agreement during 2005 to reimburse a related party for a variable percentage of its overhead expenses, to reimburse 100% of its out-of-pocket expenses incurred on behalf of the company, and to pay a percentage fee based on the total overhead and corporate expenses referred to above. The agreement may be terminated with one-month notice by either party.

9.    Subsequent Events

The Company entered into a 3 month Investor Relations Agreement on August 30, 2006 with Agoracom Investor Relations Corp. (“Agoracom”), to provide online marketing services. In consideration for the services rendered, the Company has agreed to pay Agoracom fees totaling $9,000 and grant Agoracom the option to purchase 20,000 common shares at a price of $3.92 per share.

Subsequent to July 31, 2006 the Company renewed a 12 month Investor Relations Agreement with Investor Relations Group Inc., formerly called Investors Relations Services Group John Mullen & Partners (“IRS”), to provide investor relations services in Europe. In consideration for the services rendered, the Company has agreed to pay IRS fees totaling $18,000 plus expenses.

Subsequent to July 31, 2006 the Company granted incentive stock options for the purchase of up to 280,000 shares at a price of $3.92 per share exercisable on or before September 5, 2011 to directors, officers, employees and consultants of the Company.

Subsequent to July 31, 2006 the Company has had 1,000 share purchase warrants exercised for total proceeds of $3,100.