12th Nov 2015 10:52
LONDON (Alliance News) - Red Rock Resources PLC Thursday reported a wider loss in its last financial year after booking a series of impairments.
"The year ended June 30, 2015 was frustrating for all of us. It contained a period of great difficulty for the entire exploration and mining sector," said Chairman Andrew Bell.
The exploratory mining company, which does not generate any revenue, reported a GBP8.4 million loss after tax in the year ended June 30, widening from the GBP4.1 million loss a year earlier. Its loss from continuing operations and before tax widened to GBP7.7 million from GBP3.8 million.
A GBP5.3 million impairment was taken against monies owed to the company by Mid Migori Mining Co Ltd related to its asset in Kenya. Red Rock and Mid Migori are currently locked in battle over the termination of licences in Kenya, and despite the impairment, the company said it is still confident it will "prevail".
A significant impairment also was taken against the iron ore assets in Greenland, reflecting the current weakness in iron ore prices, totalling GBP1.3 million. In the last financial year, impairments only totalled GBP2.3 million.
Away from its legal troubles, Red Rock said its "small but valuable" stake in Jupiter Mines Ltd was "one bright spot" during the period after Jupiter kick-started a 1.0 million tonne operation at its manganese mine in South Africa, before doubling production, it said.
"The period was therefore one where the restructuring and improvement of finances we sought made progress, but more slowly than we expected or wanted, and against a most unfavourable backdrop," said Bell.
Red Rock slashed its workforce by 80% during the financial year and said it plans to only have three full-time employees by January 2016.
Red Rock shares were down 2.2% at 0.0220 pence per share on Thursday.
By Joshua Warner; [email protected]; @JoshAlliance
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