19th Apr 2017 07:12
Asa Resource Group plc("Asa Resource", "the Group" or "the Company")
Anonymous allegations & Legal update- Freda Rebecca
Further to the Company's announcement on 18th April 2017, the Board provides further information on the Group's cash position.
So far as its two principal mining operations are concerned, Freda Rebecca Gold Mine ("FRGM") and Bindura Nickel Corporation ("BNC"), continuing cash flows from operations at each mine are expected to be adequate for the normal working capital requirements of these mines. Both FRGM and BNC have their own banking facilities that are being utilised in the normal way.
At Group level there are a number of outstanding creditors, mainly relating to legacy litigation and unpaid directors fees and salaries. These amounts are expected to be paid in due course from management fees payable by BNC and FRGM to the Company.
The Board is satisfied that it has established that the total amount of Asa Resource funds that are unaccounted for is $4.3m. Of this amount $2.7m relates to the year ended 31st March 2016 and $1.6m relates to the year ended 31st March 2017. The sum of $1.6m in 2017 has been traced to two Group companies administered from Hong Kong but the Board has yet to confirm whether any part of this sum remains within the two companies. The Board has not relied on these amounts and any recoveries will improve the expected cash position.
The Company continues to maintain its exploration permits in the DRC and there is approximately $500,000 due to creditors as at 31st March 2017. These sums are in line with the Group's normal level of creditors within the DRC.
At Klipspringer, the change to reprocessing fine to coarse tailings has meant that for the last three months there has been nominal cash inflows which are at a lower level than originally anticipated. This has meant that certain creditors are in arrears and are expected to be addressed in due course.
Asa Meat in South Africa has no immediate need for cash and has a positive cash balance at its bank on 31st March 2017.
Following recent management changes announced on 18th April 2017, the Board is now satisfied there are sound operational financial controls at FRGM and BNC.
Shareholders should be assured that the Board is taking every measure possible to recover these sums and to restore confidence in its operations and across the Group.
CONTACT
London
Asa Resource Group plc.
One Fleet Place, London EC4M 7W
Ian B Dearing Ll B, Group General Counsel and Company Secretary
Niall Henry, non-Executive Director (Investor Relations)
Nominated Adviser and Joint Broker
SP Angel Corporate Finance LLP
Prince Frederick House, 35-39 Maddox Street, London W1S 2PP
John Mackay, Jeff Keating, Caroline Rowe
Tel: +44 (0) 20 3470 0470
Related Shares:
Asa Resources