29th Aug 2006 07:01
Namibian Resources PLC29 August 2006 Namibian Resources Plc Annual report and Results for the year ended 28 February 2006 Chairman's statement The year to 28 February 2006 has been very satisfactory compared to 2005. Highlights • Loss of £64,373 against a loss of £490,844 in 2005• Total Recognised Gains (after currency gains) of £83,282 against losses of £443,003 in 2005.• Turnover £484,030 against £29,633 in 2005.• Cash resources are £488,755 against £217,972 in 2005 and the Company has no borrowings. The current financial year has started extremely well and we look forward tomaking further progress. Thanks are due to our staff. In particular I wouldlike to thank Tony Carlton our C.E.O. who is controlling our business on aday-to-day basis, extremely ably. The valuable geological assistance provided by Namdeb is also very muchappreciated. Our own consultant geologist Dr Donald Sutherland of PlacerAnalysis Edinburgh has provided us with highly professional assistance andguidance. The company's Annual General Meeting will be held on Friday 27th October. Lord Sheppard of Didgemere KCVO KtChairman 22nd August 2006 Namibian Resources Plc Consolidated profit and loss account for the year ended 28 February 2006 Note 2006 2005 £ £Turnover 2 484,030 29,633Cost of sales (352,178) (296,750) ________ ________Gross profit/(loss) 131,852 (267,117) Administrative expenses (205,689) (254,409) ________ ________Operating loss 4 (73,837) (521,526) Other interest receivable and similar income 9,464 30,682 ________ ________Loss on ordinary activities £(64,373) £(490,844)before and after taxation Loss per share (pence) 6Basic (0.19) (1.60) ________ ________Diluted (0.17) (1.43) ________ ________ All amounts relate to continuing activities. Consolidated statement of total recognised gains and losses for the year ended28 February 2006 2006 2005 £ £ Loss for the financial year (64,373) (490,844) Currency translation differences on foreigncurrency net investments 147,655 47,841 ________ ________Total recognised gains and losses for the year £83,282 £(443,003) ________ ________ The notes on pages 11 to 20 form part of these financial statements. Namibian Resources Plc Consolidated balance sheet at 28 February 2006 Note 2006 2006 2005 2005 £ £ £ £Fixed assetsIntangible assets:Mining rights 8 755,093 693,728 ________ ________ 755,093 693,728Tangible assets 9 1,506,284 1,260,928 ________ ________ 2,261,377 1,954,656Current assets Stock 11 34,644 -Debtors 12 31,375 25,364Cash at bank and in hand 488,755 217,972 ________ ________ 554,774 243,336Creditors: amounts fallingdue within one year 13 (74,663) (48,259) ________ ________Net current assets 480,111 195,077 ________ ________Total assets less currentliabilities £2,741,488 £2,149,733 ________ ________ Capital and reservesCalled up share capital 15 3,792,246 3,283,773Share premium account 16 359,384 359,384Profit and loss account 17 (1,410,142) (1,493,424) ________ ________ Shareholders' funds - equity £2,741,488 £2,149,733 ________ ________ The financial statements were approved by the Board on 22nd August 2006 O PlummerDirector The notes on pages 11 to 20 form part of these financial statements. Namibian Resources Plc Company balance sheet at 28 February 2006 Note 2006 2006 2005 2005 £ £ £ £Fixed assetsInvestments 10 2,802,763 2,704,423Tangible Assets 9 494 988 _________ _________ 2,803,257 2,705,411 Current assetsDebtors 12 11,750 11,750Cash at bank and in hand 399,821 151,992 ________ ________ 411,571 163,742 Creditors: amounts falling duewithin one year 13 (12,945) (17,333) ________ ________Net current assets 398,626 146,409 ________ ________ Total assets less current £3,201,883 £2,851,820liabilities ________ ________ Capital and reservesCalled up share capital 15 3,792,246 3,283,773Share Premium account 16 359,384 359,384Profit and loss account 17 (949,747) (791,337) ________ ________ Shareholders' funds -equity £3,201,883 £2,851,820 ________ ________ The financial statements were approved by the Board on 22nd August 2006 O PlummerDirector The notes on pages 11 to 20 form part of these financial statements. Namibian Resources Plc Consolidated cash flow statement for the year ended 28 February 2006 Note 2006 2005 £ £ Net cash inflow/(outflow) from operating activities 19 69,607 (348,114) Returns on investments and servicingof financeInterest received 9,464 30,682 Investing ActivitiesPayments to acquire investments - (10,537)Payments to acquire intangible assets (28,387) (47,695)Payments to acquire tangible fixed assets (288,374) (1,290,002) ________ ________Net cash outflow before managementof liquid resources and financing (237,690) (1,665,666) FinancingIssue of shares and exercise of warrants and options 508,473 1,875,184 ________ ________ Increase in cash in the year 21 £270,783 £209,518 ________ ________ The notes on pages 11 to 20 form part of these financial statements. Namibian Resources Plc Notes forming part of the financial statements for the year ended 28 February2006 1 Accounting policies The financial statements have been prepared under the historical cost conventionand are in accordance with applicable accounting standards. The followingprincipal accounting policies have been applied: Basis of consolidation The consolidated profit and loss account and balance sheet include the financialstatements of the company and its subsidiary undertakings made up to 28 February2006. The results of subsidiaries sold or acquired are included in the profitand loss account up to, or from the date control passes. Intra-group sales andprofits are eliminated fully on consolidation. Going Concern The company's ability to continue as a going concern depends on the prospects offuture profitable trade. To date, the company and the group have accumulatedtrading losses since the commencement of mining activities and there areinherent uncertainties in the mining industry which make it impossible topredict when the company will become profitable. Nevertheless, the directorsremain confident that the company and the group will trade profitably in theforeseeable future and will be able to continue to meet its liabilities as theyfall due. Turnover Turnover represents sales to NAMDEB Diamond Corporation (Proprietary) Limited("NAMDEB") at invoiced amounts less sales tax and trade discounts. Turnover isrecognised when diamonds are delivered to NAMDEB. Mining rights Mining rights are carried at cost less accumulated amortisation. Amortisationis calculated to write off the cost in approximate equal annual instalments overthe period of the concession. Tangible fixed assets and depreciation Tangible fixed assets are stated at cost less depreciation. Depreciation isprovided at rates calculated to write off the costs less the estimated residualvalue of each asset over its expected useful life, as follows: Motor Vehicles - 4 yearsPlant and machinery - 10 - 20 yearsOffice Equipment - 3 years Leasing Rentals payable under operating leases are charged against income on astraight-line basis over the lease term. Investments Fixed asset investments are stated at cost less provision for diminution invalue. Namibian Resources Plc Notes forming part of the financial statements for the year ended 28 February2006 (Continued) 1 Accounting policies (Continued) Stock Stock represents inventories of consumable stores, held at the lower of cost andnet realisable value. Deferred taxation Deferred tax balances are recognised in respect of all timing differences thathave originated but not reversed by the balance sheet date except that therecognition of deferred tax assets is limited to the extent that the companyanticipates making sufficient taxable profits in the future to absorb thereversal of the underlying timing differences. Deferred tax balances are not discounted. Foreign currency translation Monetary assets and liabilities denominated in foreign currencies are translatedinto sterling at the rates of exchange ruling at the balance sheet date.Transactions in foreign currencies are recorded at the rate ruling at the dateof the transaction. The results of overseas operations and the balance sheets are translated at therates ruling at the balance sheet date. Exchange differences arising ontranslation of opening assets are reported in the statement of total recognisedgains and losses. All other exchange differences are included in the profit andloss account. 2 Turnover The total turnover of the group for the year has been derived from its principalactivity, mining, wholly undertaken by its subsidiary in Namibia, SonnbergDiamonds (Namibia) (Proprietary) Limited ("Sonnberg"). All sales are made inNamibia and the majority of assets are also located in Namibia. 3 Employees 2006 2005 £ £Staff costs consist of: Directors Remuneration 55,000 50,417Wages and Salaries 19,273 36,202Social Security Costs 6,768 1,144 ________ ________ The average monthly number of employees, (including directors),during the year was: Number Number Staff of subsidiary 10 12Staff of head office 1 1Directors 5 5 ________ ________ 16 18 ________ ________ Namibian Resources Plc Notes forming part of the financial statements for the year ended 28 February2006 (Continued) 4 Operating loss 2006 2005 £ £This has been arrived at after charging:Depreciation 126,534 29,074Amortisation 13,009 130,160Exchange differences - 36Operating lease rentals - land and buildings 7,768 6,318Auditors' remuneration - audit(company - £9,211 (2005 - £14,436)) 12,124 17,032 ________ ________ 5 Taxation on loss on ordinary activities There has been no tax payable in this or the previous year due to theavailability of losses. 2006 2005 £ £ Loss on ordinary activities before tax (64,373) (490,844) ________ ________ Loss on ordinary activities at the standard rate ofcorporation tax in the UK of 30% (2005 - 30%) (19,312) (147,253)Effects of:Tax losses 19,312 147,253 ________ ________ Current tax charge for year - - ________ ________ A deferred tax asset of £711,728 (2005 - £718,568) relating to losses in thesubsidiary undertakings has not been recognised due to uncertainty regarding theavailability of suitable taxable profits against which the losses can berecovered. 6 Loss per share Loss per share has been calculated using the weighted average number of sharesin issue during the relevant financial periods. The weighted average number ofshares in issue is 34,264,560 (2005 - 30,756,130) and the loss, being the lossafter tax, is £64,373 (2005 loss - £490,844). Diluted loss per share has been calculated using a weighted average number ofshares of 37,764,560 (2005 - 34,256,133), which includes the share options inissue at the start and end of the year. Namibian Resources Plc Notes forming part of the financial statements for the year ended 28 February2006 (Continued) 7 Loss for the financial period As permitted by Section 230 of the Companies Act 1985, the holding company'sprofit and loss account has not been included in these financial statements.The loss for the financial year is made up as follows: 2006 2005 Holding company's loss for the financial year £(158,410) £(657,474) ________ ________ 8 Intangible fixed assets Mining rights Group £ CostAt 1 March 2005 1,270,787Exchange differences 84,243Additions 28,387 ________ At 28 February 2006 1,383,417 ________AmortisationAt 1 March 2005 577,059Charge for the year 13,009Exchange differences 38,256 ________ At 28 February 2006 628,324 ________Net book valueAt 28 February 2006 £755,093 ________ At 28 February 2005 £693,728 ________ Namibian Resources Plc Notes forming part of the financial statements for the year ended 28 February2006 (Continued) 9 Tangible fixed assets Office Equipment Plant & Machinery Motor Total Vehicle £ £ £GroupCostAt 1 March 2005 1,482 2,145,611 2,147,093Additions 3,375 284,999 288,374Exchange difference - 83,516 83,516 ________ ________ ________ At 28 February 2006 4,857 2,514,126 2,518,983 ________ ________ ________ DepreciationAt 1 March 2005 494 885,671 886,165Charge for the year 1,034 125,500 126,534 ________ ________ ________ At 28 February 2006 1,528 1,011,171 1,012,699 ________ ________ ________ Net book ValueAt 28 February 2006 £3,329 £1,502,955 £1,506,284 ________ ________ ________ At 28 February 2005 £988 £1,259,940 £1,260,928 ________ ________ ________ Company Office equipment £ At 1 March 2005 and 28 February 2006 1,482 ________Depreciation At 1 March 2005 494Provided in the year 494 ________At 28 February 2006 988 ________Net book valueAt 28 February 2006 £494 ________ At 28 February 2005 £988 ________ Namibian Resources Plc Notes forming part of the financial statements for the year ended 28 February2006 (Continued) 10 Fixed asset investments Group Loans to group Total undertakings undertakings £ £ £CompanyAt 1 March 2005 2,064,225 1,768,734 3,832,959Additions - 98,340 98,340 ________ ________ ________At 28 February 2006 2,064,225 1,867,074 3,931,299 ________ ________ ________Provisions for diminution in valueAt 1 March 2005 and 28 February 2006 628,536 500,000 1,128,536 ________ ________ ________ Net book valueAt 28 February 2006 £1,435,689 £1,367,074 £2,802,763 ________ ________ ________ At 28 February 2005 £1,435,689 £1,268,734 £2,704,423 ________ ________ ________ Investment in group undertakings includes • 100% holding in Sonnberg Diamonds (Namibia) (Proprietary) Limited, a mining company incorporated in Namibia. • 75% of the issued share capital of Oletu Investment Holdings (Pty) Limited, a company incorporated in Namibia. 11 Stock Group Group 2006 2005 Consumable stores £34,644 £- ________ ________ 12 Debtors Group Group Company Company 2006 2005 2006 2005 £ £ £ £ Trade debtors 19,625 13,614 - -Prepayments 11,750 11,750 11,750 11,750 ________ ________ ________ ________ £31,375 £25,364 £11,750 £11,750 ________ ________ ________ ________ All amounts fall due for repayment within one year. Namibian Resources Plc Notes forming part of the financial statements for the year ended 28 February2006 (Continued) 13 Creditors: amounts falling due within one year Group Group Company Company 2006 2005 2006 2005 £ £ £ £ Trade creditors and accruals 74,663 48,259 12,945 17,333 ________ ________ ________ ________ 14 Derivatives and other financial instruments Financial instruments policies and strategies During the period since its incorporation, the group has financed its businesswith the cash it has raised through the issue of shares. It has used thesefunds to acquire and develop business in Namibia. The main risk arising fromthe group's financial instruments is foreign currency risk. At 28 February 2006, the group's financial instruments comprised cash andshort-term debtors and creditors arising directly from its operations. Thegroup's primary treasury activity has been the management of cash. This hasbeen held so as to maximise interest earned without compromising the group'sneed for flexibility in meeting its cash needs. The group is not currentlyactively pursuing a strategy of acquiring investments. Although the group is based in the UK, it has a significant investment inNamibia. As a result, the group's sterling balance sheet can be significantlyaffected by movements in the Namibian Dollar/Sterling exchange rates. Sales of diamonds are denominated in Namibian Dollars but the price obtained isdependent on market prices set in US Dollars. The group incurs costs in bothSterling and Namibian Dollars. The group has not entered into any derivative transactions during the year. Short-term debtors and creditors have been excluded from the numericaldisclosures below. Interest rate risk profile of financial assets: Floating rate 2006 2005 £ £ Sterling 459,821 65,980Namibian dollar 28,934 151,992 ________ ________ £488,755 £217,972 ________ ________ The financial assets comprise short-term cash deposits. The group does not haveany material interest bearing financial liabilities. As the group's principalfinancial instruments is cash, the directors do not consider there to be amaterial difference between the book and fair value of the group's financialassets. Namibian Resources Plc Notes forming part of the financial statements for the year ended 28 February2006 (Continued) 15 Share capital Shares 2006 2005 2006 2005 Number Number £ £Authorised500,000,000 ordinary shares of 10p each 500,000,000 500,000,000 50,000,000 50,000,000 __________ __________ _________ __________ Allotted, called up and fully paidOrdinary shares of 10p each 37,922,460 32,837,730 3,792,246 3,283,773 __________ __________ __________ __________ Warrants During the year, 5,084,730 warrants were exercised, raising proceeds of£508,473. Options The company has in issue the following options to subscribe for ordinary shares: 2006 2005 Number 3,500,000 3,500,000 _________ _________ 16 Share Premium Account Group and Company Share Premium account At 1 March 2005 and 28 February 2006 £359,384 ________ 17 Profit and Loss Account Group £ At 1 March 2005 (1,493,424)Loss for the year (64,373)Foreign currency translation differences 147,655 ________At 28 February 2006 £(1,410,142) ________ Company £ At 1 March 2005 (791,337)Loss for the year (158,410) ________At 28 February 2006 £(949,747) ________ Namibian Resources Plc Notes forming part of the financial statements for the year ended 28 February2006 (Continued) 18 Reconciliation of movements in shareholders' funds 2006 2005 £ £GroupLoss for the financial year (64,373) (490,844)Other recognised gains and losses 147,655 37,304Issue of shares and exercise of warrants and options 508,473 1,875,184 ________ ________Net addition to shareholders' funds 591,755 1,421,644Opening shareholders' funds 2,149,733 728,089 ________ ________Closing shareholders' funds £2,741,488 £2,149,733 ________ ________ 2006 2005Company £ £ Loss for the financial year (158,410) (657,474)Issue of shares 508,473 1,875,184 ________ ________ Net addition to shareholders' funds 350,063 1,217,710Opening shareholders' funds 2,851,820 1,634,110 ________ ________ Closing shareholders' funds £3,201,883 £2,851,820 ________ ________ 19 Reconciliation of operating loss to net cash outflow from operatingactivities 2006 2005 £ £ Operating loss (73,837) (521,526)Depreciation of tangible assets 126,534 29,074Amortisation of intangible assets 13,009 130,160(Increase) in stock (34,644) -(Increase)/decrease in debtors (6,012) 76,655Increase/(decrease) in creditors 26,405 (110,786)Net effect of foreign exchange differences 18,152 48,309 ________ ________ Net cash inflow/(outflow) from operating activities £69,607 (348,114) ________ ________ Namibian Resources Plc Notes forming part of the financial statements for the year ended 28 February2006 (Continued) 20 Analysis of net debt At 1 March 2005 Cash flow At 28 February 2006 £ £ £Net cash: Cash at bank and in hand £217,972 £270,783 £488,755 ________ ________ ________ 21 Reconciliation of net cash flow to movement in net funds 2006 2005 £ £ Increase in cash for the year 270,783 209,518 ________ ________ Movement in net funds in the year 270,783 209,518Opening net funds 217,972 8,454 ________ ________ Closing net funds £488,755 £217,972 ________ ________ 22 Contingent liabilities The mining contract undertaken by the group requires the subsidiary, Sonnberg,to remove all equipment and installations and to rehabilitate all disturbedareas once mining activities have ceased. Sonnberg pay 1% of sales to a fund held by NAMDEB Diamond Corporation(Proprietary) Limited, to provide for the costs of environmental rehabilitation.The directors' best estimate is that there is no additional liability at thebalance sheet date to the contributions already made to this fund. Accordingly,no provision has been made. 23 Commitments under operating leases As at 28 February 2006, the company had annual commitments under non-cancellableoperating leases as set out below: 2006 2005 Land and buildings Land and buildings £ £ Expiring in less than one year 2,968 2,318 ________ ________ 24 Transactions with Directors During the year, ACA Carlton, a director of Namibian Resources PLC, advanced asum of £60,000 to Sonnberg, a subsidiary company. This loan was repaid beforethe end of the year. The report and accounts have been sent to shareholders and copies will beavailable for collection at or by writing to the Company's offices located atCargil Management Services, 302 High Street, Croydon, Surrey, CR0 1NG For further information, please contact: Tony Carlton, CEO, 020 8680 1600Oliver Plummer, Finance Director 020 7381 0100 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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