American Lithium Minerals, Inc.

What they do

The company was incorporated in Nevada in 2005 and changed its name to American Lithium Minerals in 2009. It has no producing mines and generates no revenue; its activities consist of acquiring and exploring lithium brine and mineral claims in Nevada and Utah. Several earlier properties were abandoned or impaired, including the Raven property in British Columbia and the Esmeralda property in Nevada.

Revenue drivers

• Exploration-stage mining operations — The company has no revenue-generating operations; it is an exploration-stage enterprise focused on lithium brine and mineral claims, and all funds are used for property acquisition and exploration.

Recent performance

At June 30, 2011, the company reported total assets of $3.0 million, total liabilities of $2.8 million, and shareholder equity of just $105,190. Cash and cash equivalents were only $11,077. The company has no revenue and relies on financing to fund operations. During fiscal 2010, it expensed $295,609 and $217,687 as mineral property impairments on two Nevada properties it abandoned.

Strategy

Management is shifting focus to a portfolio of lithium brine projects in Nevada and Utah, acquired in 2010 from Gold Summit Corporation, Robert Craig, and others. In June 2010, the company signed an option agreement with JOGMEC, allowing JOGMEC to earn a 40% interest in certain Nevada claims through staged work commitments totaling $4 million over three years. The company is also pursuing additional mineral claims in Nevada and Utah. However, with minimal cash and no revenue, it will need to raise capital or rely on partner funding to advance exploration.

Risks

• Exploration risk — All properties are early-stage and may never contain economically recoverable lithium or other minerals.
• Liquidity risk — With only $11,077 in cash at June 30, 2011, the company may be unable to meet its obligations or fund exploration.
• Financing risk — The company has no revenue and depends on equity or debt financing, which may not be available on acceptable terms.
• Title and royalty risk — Properties are subject to royalties, including a 2% NRR on certain claims, and title may be challenged or expire if obligations are not met.

Outlook

Management has not provided specific guidance. The company's ability to continue as a going concern depends on raising additional capital or securing partner funding. Exploration success is uncertain and no production is expected in the near term.