29th Jun 2007 17:30
Everfor Diamonds PLC29 June 2007 AIM: EVE PRESS RELEASE 29 June 2007 Everfor Diamonds plc Final Results for the Year Ended 31 December 2006--------------------------------------------------------------------------------Everfor Diamonds plc ('Everfor', or the 'Company') (AIM:EVE) the AIM-listeddiamond explorations company developing deposits in the north west of theRussian federation, announces its audited results for the year ended 31 December2006. Highlights Financial Highlights • Everfor Diamonds plc graduated to the Alternative Investment Market ("AIM") of the London Stock Exchange on 6 April 2006 • The Admission to trading on AIM provided the opportunity for the Company to allot shares to raise net funding of approximately £1.4m. These proceeds were used to commence and, subsequent to year-end, complete an extensive exploration drilling programme. • At year-end sufficient cash funds exist for the Company to continue its sample analysis and prospective drilling target determination for the period extending 18 months from balance sheet date. Annual General Meeting The annual general meeting of the Company will be held at Ground Floor, 1 RedPlace, London W1K 6PL at 10.30am on 31 July 2007. Executive Chairman, Dr Sergey V Kurzin commented: "As a relatively new entrant to the sector, Everfor has three years' explorationactivities on which to capitalise and make those important new kimberlitediscoveries. I remain confident that we have the correct geological address andlook forward to the results of our future work programmes." Executive Chairman's Statement "I am pleased to report that the Everfor Diamonds was officially admitted to theAlternative Investment Market (AIM) of the London Stock Exchange in April 2006.Funds were not raised on admission but obtained via a prior private placement.These funds were used to continue Everfor's vigorous diamond explorationprogramme in northwest Russia. Our drilling contractors in the Kola Peninsula, the Central Kola Expedition,were highly proactive in obtaining new, lightweight and environmentallysensitive drilling equipment and support vehicles. This equipment allows thetraditional drilling season of mid-February to end April to be extended into thesummer and autumn months. Regrettably, delays in securing the equipment and thetraining of personnel resulted in slower than estimated drilling progress. Project Status Reconnaissance sampling is complete in three of the four licences and the entirearea of Tulomo-Teriberskaya has now been surveyed with high definitionaeromagnetics. In December, a comprehensive report on the Company's explorationactivities was prepared for each licence, as stipulated in the licenceconditions, and submitted to the regulatory authorities for review. Drilling continued in the first quarter of 2007, but a warmer than expectedwinter precluded the necessary ice thicknesses forming in the rivers and lakesso access was delayed until March. Outlook The diamond market in 2006 proved turbulent but sluggish and the imbalancebetween rough and polished prices continued in to early 2007. It would appearthat there is now a movement upwards in both rough and polished prices and thereis mounting evidence that diamonds as a commodity are once again regainingfavour with the investment community. Over the past ten years, De Beers has moved from controlling over 80% of theindustry to a company whose market share has diminished to less than 50%. Fornew and existing players, a number of growth opportunities have been created bythe fact that De Beers' decisions are being heavily influenced by the sentimentsof producer countries. A degree of negative sentiment with respect to investments in Russia has beennoted, principally as a result of events in the energy sector. The broadereffects of the re-registration of Alrosa from the Russian corporate form ZAO,closed corporation, to OAO, open public corporation remain to be seen. Provided that disposable income in developed and developing consumer societiescontinues to increase as estimated, there is little doubt that the supply-demandprojections for diamonds will be justified. The long lead-time between thelocation and the exploitation of diamond sources, coupled with the lack ofrecent discoveries, indicates that the ensuing ten to twenty years will be anexciting time for diamond exploration companies. Everfor, as a relatively new entrant to the sector, has three years' explorationactivities on which to capitalise and make those important new kimberlitediscoveries. I remain confident that we have the correct geological address andlook forward to the results of our future work programmes." Dr Sergey V Kurzin Executive Chairman 29 June, 2007 The full 2006 Annual Report of the Company is available for download from theCompany's website (www.everfor.com) and will be mailed to shareholders on 30June 2007. Everfor Diamonds plc Group profit and loss account for the year ended 31 December 2006 ----------- ---------- Note 2006 Restated (see note 1) 2005 ----------- ---------- £'000 £'000 Exploration expenses (444) (584)Other administrative expenses (962) (669) ----------- ----------Operating loss (1,406) (1,253) Interest receivable and similar income 40 38 ----------- ----------Loss on ordinary activities before taxation (1,366) (1,215) Tax on loss on ordinary activities - - ----------- ---------- Loss on ordinary activities after taxation (1,366) (1,215) Minority interest 91 85 ----------- ----------Loss for the financial year (1,275) (1,130) =========== ========== =========== ========== Loss per share - basic and diluted 2 (1.44)p (1.94)p Group statement of total recognised gains and losses for the year ended 31December 2006 2006 Restated 2005 £'000 £'000 Loss for thefinancial year (1,275) (1,130) Foreign exchange translation differences 25 (23) on consolidation ---------- ---------- ---------- ----------Total lossesrecognised forthe year (1,250) (1,153) ========== ========== Group balance sheet as at 31 December 2006 Notes 2006 2005 £'000 £'000Fixed assetsIntangible fixed assets 3,182 3,182Tangible fixed assets 4 6 --------- ---------- 3,186 3,188 Current assetsDebtors 193 250Cash at bank and in hand 656 448 --------- ---------- 849 698 --------- ----------Creditors: amounts falling due within (105) (78)one year --------- ---------- Net current assets 744 620 --------- ----------Total assets less current liabilities 3,930 3,808 ========= ========== Capital and reservesCalled up share capital 989 581Share premium 4,111 3,122Merger reserve 1,950 1,950Profit and loss account - deficit (3,504) (2,313) --------- ----------Total shareholders' funds 3,546 3,340 Minority interests 384 468 --------- ---------- 3,930 3,808 ========= ========== Group cash flow statement for the year ended 31 December 2006 Note 2006 2005 £'000 £'000 Net cash outflow from operating 3 (1,185) (1,367)activities Returns on investments andservicing of financeInterest received 40 38Net cash inflow from returns on 40 38investments and servicing of finance Capital expenditure and financialinvestmentPurchase of tangible fixed assets (2) (3) ------- --------Net cash outflow for capital (2) (3)expenditure and financial investment ------- --------Cash outflow before management of (1,147) (1,332)liquid resources & financing FinancingIssue of ordinary shares 1,397 - ------- --------Cash inflow from financing 1,397 - ======= ========Increase/(decrease) in net cash in 4,5 250 (1,332)the year ======= ======== Notes forming part of the financial statements for the year ended 31 December2006 1. Adoption of FRS 20 - Share Based Payment The Group has adopted Financial Reporting Standard (FRS) 20 'Share basedPayment' during the year. The adoption of this standard constitutes a change inaccounting policy. Therefore, the impact has been reflected as a prior yearadjustment in accordance with FRS 3 'Reporting Financial Performance'. The standard requires that where shares or rights to shares are granted to thirdparties, including employees, a charge should be recognised in the profit andloss account based on the fair value of the shares at the date the grant ofshares or right to shares is made. The adoption of FRS 20 has increased operating loss and retained loss for theyear by £58,550 (2005 loss: by £68,485) and increased loss per share by 0.08p(2005: by 0.11p). There is no impact on the net assets of the Group. 2. Loss per ordinary share The basic and diluted loss per share of 1.44 pence (2005: 1.94 pence, restated)is calculated, in accordance with FRS 22 (Earnings per share), on a loss onordinary activities of £1,275,000 (2005: £1,130,000, restated) and on 88,665,541ordinary shares (2005: 58,099,290), being the weighted average number ofordinary shares in issue for the year ended 31 December 2006. 3. Reconciliation of operating loss to net cash outflow fromoperating activities 2006 Restated 2005 £'000 £'000 Operating loss (1,406) (1,253)Depreciation of tangible fixed assets 3 3Increase /(decrease) in debtors 57 (161)Increase /(decrease) in creditors 27 (24)Foreign exchange differences 75 -Share based payments 59 68 ---------- ----------Net cash outflow from operating activities (1,185) (1,367) ========== ========== 4. Reconciliation of net cash flow to movement in the net cash 2006 2005 £'000 £'000 Net cash at the start of the year 388 1,748Increase /(decrease) in net cash in the year 250 (1,332) ---------- ----------Movement in net cash arising from cashflows 638 416Foreign exchange movement (42) (28) ---------- ----------Net cash at end of the year 596 388 ========== ========== 5. Analysis of net funds At 1.1.06 Cash flow Foreign At 31.12.06 Exchange £'000 £'000 £'000 £'000 Cash and short term deposits 388 250 (42) 596Liquid resources 60 - - 60 -------- -------- -------- --------Net funds 448 250 (42) 656 ======== ======== ======== ======== ENDS Notes to Editors: Everfor Diamonds plc was formed in January 2004 with the specific intention ofexploring in the Russian Federation. This was based upon a positive technicalassessment by the then geological consultant (now Managing Director), whichhighlighted the untapped potential of the Kola Peninsula. The extensive networkof contacts available to the Executive Chairman allowed swift applications forground to be made and four licence areas for diamond prospecting were granted.The Pulongskaya and Ermakovskaya licences contain core areas whereclose-interval sampling and some geophysical surveying has taken place byprevious explorers. Two known kimberlites are located in the Ermakovskayalicence. For further information please contact: Donald Duncan, Managing Director, Everfor Diamonds plcTel: +44 (0)20 7514 0590 Gavin Dallas, Marketing and PR, Everfor Diamonds PlcTel: +44 (0)20 7514 0590 Robin Birchall / Ryan Gaffney, Canaccord Adams LimitedTel: +44 (0)20 7050 6500 www.everfor.com This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
EVE.L