13th Mar 2014 14:41
LONDON (Alliance News) - Ferrum Crescent Ltd Thursday posted a wider pretax loss for the first half of its financial year as its revenues fell sharply and it booked financial losses.
The company, which is continuing to develop its Moonlight Iron Ore Project in South Africa, posted a pretax loss of AUD1.7 million in the six months ended December 31, 2013, compared with a loss of AUD1.2 million a year earlier, as revenue, which is made up of investment income and interest received, dropped to AUD19,669 from AUD73,354.
The widened loss was also partly as a result of a AUD642,742 loss on financial instrument relating to a forward subscription agreement with Mkhombi Investments (Pty) Ltd, and charges of AUD113,274 in share based payments.
The company said its had been working to progress its Moonlight Project during the half year. It signed a legally binding letter with Anwar Asian Investment to facilitate the completion of a Bankable Feasibility Study at the project.
Anwar will pay Ferrum Crescent USD10 million for a 35% shareholding in Ferrum Iron Ore (Pty) Ltd, and contribute costs of USD1.5 million to the study.
Ferrum is the operator and owns 97% of the Moonlight project.
Ferrum had advanced plans to implement a drilling programme on the forms Julietta and Gouda Fontein to increase the total resource estimate of the Moonlight project, but determined that as there are sufficient resources at Moonlight to support mining for over 20 years, it will focus its attention instead on getting definitive answers on the logistics and related infrastructure for a definitive feasibility study.
Mineral Corporation Consultancy Ltd was commissioned to carry out an updated JORC compliant Mineral Resource Estimate at the site. Based on results from the estimate, the company says that the total average Iron grade had decreased slightly, but the tonnage had increased proportionately, along with an increase in the confidence and classification of the resource.
"I look forward to 2014 and moving Moonlight towards being a producer of a high quality iron ore product that is situated near established infrastructure," said Chairman Ed Nealon in a statement.
Shares in Ferrum were trading down 8.4% at 1.90 pence Thursday afternoon.
By Hana Stewart-Smith; [email protected]; @hanassallnews
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