The announcement was not taken well by investors, who pummelled the stock yesterday.
Oceana employs more than 300 staff in New Zealand, most of them at the Macraes gold project, in East Otago.
Despite numerous positives during the year, including record production, sales, falling costs and strong global spot gold prices, chief executive Steve Orr candidly outlined that Oceana's liabilities now exceeded its assets by $US43.4 million.
"Current cash-flow projections indicate sufficient funds to continue as a going concern for at least the next 12-months.
"However, should certain assumptions not be achieved, cash-flow deficit may occur, which could lead to doubt as to the ability of the company to meet its future obligations as they fall due and, accordingly, whether the application of the `going concern' principle is appropriate," Mr Orr said.
Oceana was considering alternatives to secure funding, but there was "no assurance that these initiatives would be successful or sufficient", he said in the company's annual report released yesterday.
Oceana's shares, which had been languishing around 20c for months, had recently been rejuvenated and steadily rose to 85c a share by Wednesday.
However, after yesterday's announcement its shares tumbled and closed down 22% at 75c by 5pm.
The $US54.7 loss, which followed a $US69 million loss for 2007, was mainly attributable to unrealised hedging (forward order contracts) losses amounting to $US73.4 million, largely an accounting requirement which might or might not appear on Oceana's bottom line at some time, ABN Amro Craigs broker Peter McIntyre said.
"Oceana made a cash-flow profit, but a loss under accounting standards," he said.
The raft of 2008 positives - record gold revenue up 108% to $US217 million, gold sales up almost 50% at 177,722 ounces, record production up by 41% to 259,812 ounces and annual production costs down by $US24 an ounce to $US532 - were all overshadowed by the booked losses and rising refinancing concerns.
Worryingly, Oceana had dwindling cash reserves, down from $US108 million last year to just $US9.7 million at the end of 2008, at a time when it was struggling to raise $US200 million with a joint-venture partner or cornerstone investor to underpin resumption of its Didipio gold/copper development mine in the northern Philippines, Mr McIntyre said.
Oceana had a "cash burn" of more than $US100 million during the past 12-months.
Refinancing issues for Didipio were becoming an ongoing "over-hang" in cost and investor sentiment, he said.
Assets fell from $US807 million to $US629 million and shareholder equity dropped 30% from $US354 million to $US264 million.
"They urgently need a joint venture for Didipio. However, that raises the question of shareholder dilution with a large cornerstone investor," Mr McIntyre said.
Forsyth Barr broker Suzanne Kinnaird said although there was a 41% production increase to 259,812 ounces for the year, about 33% was hedged at $NZ773 per ounce, compared to the current record gold spot price of around $NZ1900.
"They saw massive swings in electricity and diesel costs, and are looking at hedging programmes for both these vital input costs," Ms Kinnaird said.
Echoing other analysts, she said it was disappointing there was no update on Oceana's "problematic" Didipio project in the Philippines.
"Oceana has stated it will consider alternatives to secure additional capital, including finance facilities and equity. [However] in the current environment this is bound to make investors nervous."
Mr McIntyre said he did not discount the possibility of Chinese investment in Oceana, as the resource-thirsty country had shown a "great appetite" for taking major stakes in "distressed" Australian producers during the past three years.
Oceana is understood to have sunk $US120 million into Didipio, but it has since mothballed the project.
Mr Orr said that "given the erosion in the global economy and international credit markets, the company was unable to source supplementary funding [for Didipio]"By December, continued deterioration of global economic conditions resulted in the decision to place Didipio on care and maintenance pending an improvement in the credit markets."
On the hedging loss of $US73.4 million, Mr Orr said it did not have an effect on cash flow "but can have a significant influence on reported net earnings".
