28th Aug 2014 07:00
DiamondCorp plc
JSE share code: DMC
AIM share code: DCP
ISIN: GB00B183ZC46
(Incorporated in England and Wales)
(Registration number 05400982)
(SA company registration number 2007/031444/10)
('DiamondCorp' or 'the Company' or 'the Group')
Interim Results (unaudited) for the six month period
ended 30 June 2014
DiamondCorp plc, a southern Africa focussed diamond mine development and exploration company, releases its unaudited interim results for the six month period ended 30 June 2014.
HIGHLIGHTS
· Capital expenditure on underground development and mine infrastructure, including conveyor belts, at the Lace project totalled R76.8 million (£4.3 million) for the six months to 30 June 2014.
· During the period, a revised development budget and schedule was adopted which will allow underground kimberlite mining to commence from the high-grade Upper K4 ("UK4") Block in the first half of 2015, six months ahead of schedule.
· The UK4 development will be funded from existing project finance facilities.
· During the period the Lace processing plant operated on tailings primarily so that it could be maintained and optimised in readiness for kimberlite processing, including the UK4 bulk test. Accordingly, income from diamond sales for the period were capitalised as a credit to mine development.
· Diamond recoveries from tailings for the period totalled 13,055 carats at an average recovered grade of 5.78 carats per hundred tonnes ("cpht"), against a budget of 5.00 cpht.
· Lace diamond sales for the period totalled 14,583 carats.
· Diamond sales before selling costs were US$907,308 (£549,884), representing an average of US$62 per carat.
· The most valuable diamond sold was a 5.6 carat sawable which achieved $3,250 per carat.
· Additional income of US$29,902 (£18,122) was generated from diamond beneficiation and fine diamond sales.
· After the period end, a 15.2 carat white octahedral diamond was recovered, the largest gem found since tailings reprocessing began in 2008.
· An equity fund raising was completed in April 2014, raising gross proceeds of £2.1 million to cover corporate overheads until such time as the Lace project is generating positive cashflow.
· Group cash on hand at the end of June was £7,315,313.
· The net loss for the six months ended 30 June 2014 was £2,748,972 (30 June 2013: £2,198,339). The loss includes a fair value adjustment of £1,585,592 on the derivative component of the convertible bonds. Operating expenses for the period were £869,266 (30 June 2013: £1,687,508).
Commenting on the results, DiamondCorp CEO Paul Loudon said: 'The period under review saw us move closer to our goal of commencing long-life underground kimberlite mining at the Lace mine. Our constant attention to mining and development costs, and emphasis on diamonds recovered rather than tonnes throughput, positions us well to generate outstanding returns for our shareholders when mining commences from the UK4 Block in the first half of 2015.'
28 August 2014
London
CONSOLIDATED Income Statement | ||
Six months ended30 June 2014 (Unaudited) | Six months ended30 June 2013 (Unaudited) | |
£ | £ | |
Operating expenses | (869 266) | (1 687 508) |
Operating loss | (869 266) | (1 687 508) |
Investment revenues | 21 988 | 29 128 |
Finance costs | (316 102) | (539 959) |
Fair value adjustments (Note 4) | (1 585 592) | - |
Loss before tax | (2 748 972) | (2 198 339) |
Tax | - | - |
Loss for the financial year | (2 748 972) | (2 198 339) |
Attributable to: | ||
Equity holders of the parent | (2 676 238) | (1 884 889) |
Non-controlling interest | (72 734) | (313 450) |
(2 748 972) | (2 198 339) | |
Basic and diluted loss per share (pence) (Note 2) | (0.91) | (0.69) |
CONSOLIDATED Statement of comprehensive incomE | ||
Period ended 30 June 2014 (Unaudited) | Period ended 30 June 2013 (Unaudited) | |
£ | £ | |
Net loss | (2 748 972) | (2 198 339) |
Other comprehensive loss: | ||
Items that may be reclassified to profit and loss: | ||
Exchange differences on translating foreign operations | (108 048) | (1 021 012) |
Other comprehensive loss for the year net of taxation | (2 857 020) | (3 219 351) |
Total comprehensive loss | ||
Total comprehensive loss attributable to: | ||
Equity holders of the parent | (2 371 327) | (2 672 061) |
Non-controlling interest | (485 693) | (547 290) |
(2 857 020) | (3 219 351) | |
CONSOLIDATED STATEMENT OF FINANCIAL POSITION | ||
Six months ended30 June 2014 (Unaudited) | Year ended30 December 2013 (Audited) | |
£ | £ | |
Assets | ||
Non-Current Assets | ||
Property, plant and underground development | 18 251 639 | 14 892 223 |
Goodwill | 4 606 026 | 4 606 026 |
Other non-current assets | 41 740 | 43 632 |
Restricted cash | 69 937 | 73 108 |
22 969 342 | 19 614 989 | |
Current assets | ||
Inventories | 520 000 | 557 085 |
Current tax receivable | 6 362 | 6 651 |
Other receivables | 667 217 | 880 990 |
Cash and cash equivalents | 7 315 313 | 2 220 130 |
8 508 892 | 3 664 856 | |
Total Assets | 31 478 234 | 23 279 845 |
Equity and Liabilities | ||
Equity | ||
Equity Attributable to owners of the parent | ||
Share capital (Note 3) | 37 161 667 | 35 190 544 |
Reserves | (1 200 268) | (1 807 236) |
Accumulated loss | (25 583 544) | (22 907 307) |
10 377 855 | 10 476 001 | |
Non-controlling interest | (2 734 619) | (1 946 868) |
Total Equity | 7 643 236 | 8 529 133 |
Liabilities | ||
Non-Current Liabilities | ||
Other financial liabilities | 16 614 893 | 9 239 447 |
Provisions | 505 892 | 528 828 |
17 120 785 | 9 768 275 | |
Current Liabilities | ||
Compound instruments - liabilities | 2 623 990 | 2 532 981 |
Compound instruments - derivatives | 3 619 296 | 2 107 849 |
Trade and other payables | 470 927 | 341 607 |
6 714 213 | 4 982 437 | |
Total Liabilities | 23 834 998 | 14 750 712 |
Total Equity and Liabilities | 31 478 234 | 23 279 845 |
STATEMENT OF CHANGES IN EQUITY (UNAUDITED) | ||||||
Total Share Capital | Total Reserves | Retained losses | Total attributable to owner of the parent | Non- controlling interest | Total | |
£ | £ | £ | £ | £ | £ | |
GROUP | ||||||
Balance at 1 January 2013 | 34 920 544 | (218 920) | (20 524 660) | 14 176 964 | (1 104 254) | 13 072 710 |
Loss for financial year | - | - | (2 382 647) | (2 382 647) | (227 257) | (2 609 904) |
Other comprehensive income | - | (1 675 211) | (1 675 211) | (615 357) | (2 290 568) | |
Total comprehensive income | - | (1 675 211) | (2 382 647) | (4 057 858) | (842 614) | (4 900 472) |
Issue of share capital | 270 000 | - | - | 270 000 | - | 270 000 |
Value attributed for equitysettled share based payments | - | 86 895 | - | 86 895 | - | 86 895 |
Balance at 31 December 2013 | 35 190 544 | (1 807 236) | (22 907 307) | 10 476 001 | (1 946 868) | 8 529 133 |
Balance at 1 January 2014 | 35 190 544 | (1 807 236) | (22 907 307) | 10 476 001 | (1 946 868) | 8 529 133 |
Loss for the 6 month period | - | - | (2 676 238) | (2 676 238) | (72 734) | (2 748 972) |
Other comprehensive income | - | 606 968 | - | 606 968 | (715 016) | (108 048) |
Total comprehensive income | - | 606 968 | (2 676 238) | (2 069 269) | (787 751) | (2 857 020) |
Issue of share capital | 1 971 123 | - | - | 1 971 123 | 1 971 123 | |
Balance at 30 June 2014 | 37 161 667 | (1 200 268) | (25 583 545) | 10 377 855 | (2 734 619) | 7 643 236 |
CONSOLIDATED Cash Flow Statement | ||
Six months ended 30 June 2014 (Unaudited) | Six months ended 30 June 2013 (Unaudited) | |
£ | £ | |
Cash flows from operating activities | ||
Cash utilised in operations | (1 110 198) | (2 359 884) |
Finance cost | (316 102) | - |
Net cash used in operating activities | (1 426 300) | (2 359 884) |
Cash flows from investing activities | ||
Purchase of property, plant and underground development | (3 038 223) | (2 594 366) |
Interest income | 21 988 | 29 128 |
Net cash used in investing activities | (3 016 235) | (2 565 238) |
Cash flows from financing activities | ||
Proceeds on share issue | 1 971 123 | - |
Proceeds from other financial liabilities | 7 375 446 | 3 830 427 |
Net cash from financing activities | 9 346 569 | 3 830 427 |
Total cash movement for the period | 4 882 046 | (1 094 695) |
Cash at the beginning of the period | 2 220 130 | 4 319 776 |
Effect of exchange rate movement on cash balances | 191 149 | (220 762) |
Total cash at end of the period | 7 315 313 | 3 004 319 |
NOTES TO THE FINANCIAL STATEMENTS
Six months ended 30 June 2014
1. ACCOUNTING POLICIES
These interim financial statements have been prepared using accounting policies consistent with International Financial Reporting Standards (IFRSs). The same accounting policies, presentation and methods of computation are followed in the condensed interim financial information as applied in the Group's latest annual audited financial statements. The financial figures included in this half-yearly report have been computed in accordance with IFRSs applicable to interim periods.
These interim financial statements were approved by the Board on 27 August 2014 and do not constitute statutory financial statements within the meaning of Section 435 of the Companies Act 2006. The results for the year ended 31 December 2013 have been extracted from the statutory financial statements of DiamondCorp plc.
A copy of the statutory accounts for the year ended 31 December 2013 has been delivered to the Registrar of Companies. The auditors' report on those accounts was not qualified and did not contain statements under Section 498 (2) or (3) of the Companies Act 2006.
These interim financial statements have been prepared using the accounting policies set out in the Group's 2013 statutory accounts.
Results for the six-month period ended 30 June 2014 and 30 June 2013 have not been audited.
The comparative information presented in the income statement has been prepared for the period 1 January 2012 - 30 June 2013. This has been performed in order to comply with the AIM rules and is presented solely for this purpose.
2. LOSS PER SHARE
IAS 33 "Earnings per share" requires presentation of diluted earnings per share when a company could be called upon to issue shares that would decrease net profit or increase net loss per share. As share options are anti-dilutive, there is no difference between earnings per share and dilutive earnings per share.
The calculation of basic and diluted loss per ordinary share is based on the loss attributable to equity holders of the parent of £2,676,238 for the six months ended 30 June 2014 (30 June 2013: £1,839,889) and on 294,360,041 ordinary shares (30 June 2013: 276,836,478) being the weighted-average number of ordinary shares in issue.
The Group presents an alternative measure of loss per share after excluding all capital gains and losses from the loss attributable to ordinary shareholders ("Headline earnings/(loss)"). Due to there being no adjustments, headline loss per share and basic loss per share is the same.
30 June 2014 | 30 June 2013 | |
Basic and diluted loss per share (pence) | (0.91) | (0.69) |
Basic and diluted loss per share (Rand) | (R0.1645) | (R0.1035) |
3. SHARE CAPITAL
DiamondCorp plc does not have an authorised share capital, in line with the provisions of the UK Companies Act 2006. The Directors' authority to issue and allot shares in the company is set each year by Company's shareholders at the Annual General Meeting. The level of disapplication in respect of pre-emption authority is determined by the Board and approved by shareholders in consultation with the Company's financial and legal advisers and is based on UK corporate governance guidelines for AIM companies.
A special resolution was passed at the AGM held on 2 July 2013 giving the Group the option of settling the convertible bond debt through the issue of a fixed amount of shares.
Also approved at the meeting held on 2 July 2013 were resolutions passed by the majority of votes cast, approving the reorganisation of the Company's share capital.
Pursuant to the share capital reorganisation, dealings in the Company's existing ordinary shares with par value of 3 pence each ceased at the close of business on 2 July 2013 and dealings in the new ordinary shares with par value of 0.1 pence commenced on both AIM and AltX on 3 July 2013.
In April 2014, 41,526,000 ordinary shares of 0.1 pence each were issued to current and new shareholders of the Company at a price of 5 pence each (R0.90). The cost associated with issuance of these shares has been charged to the share premium account.
30 June 2014 | 30 June 2013 | |
Number of shares issued before reorganisation: | ||
Ordinary shares | 276 839 478 | 270 839 478 |
Issue of ordinary shares | 41 526 000 | 6 000 000 |
318 365 478 | 276 839 478 | |
Reconciliation of number of shares issued after | ||
reorganisation: | ||
Ordinary shares of 0.1 pence each | 318 365 478 | 276 839 478 |
Ordinary shares of 2.9 pence each | 276 839 478 | 276 839 478 |
595 204 956 | 553 678 956 | |
Issued | £ | £ |
Ordinary shares of 0.1 pence each | 318 366 | 276 840 |
Deferred ordinary shares of 2.9 pence each | 8 028 344 | 8 028 344 |
Share premium | 28 814 957 | 26 885 360 |
37 161 667 | 35 190 544 |
Share Re-organisation Detail
- Existing ordinary shares were sub-divided into one new ordinary share of 0.1 pence each (New Ordinary Share") and one deferred ordinary share of 2.90 pence each (Deferred Ordinary Share).
- The New Ordinary Shares continue to carry the same rights and benefits as those attached to the Company's existing ordinary shares (save for the reduction in nominal value). The number of New Ordinary Shares in issue following the Share Capital Reorganisation is identical to the number of existing ordinary shares in issue immediately prior to the Share Capital Reorganisation.
- The Deferred Ordinary Shares do not entitle the holders to (a) receive notice of or attend and vote at any general meeting of the Company; (b) to receive any dividend or other distribution; or (c) to participate in any return on capital on winding up, other than the nominal amount paid on such shares following a substantial distribution to holders of ordinary shares in the Company.
- The Deferred Ordinary Shares are effectively valueless, non-transferable and have no effect on the economic interest of the Shareholders.
4. MOVEMENT IN FAIR VALUE
The movement in fair value as indicated in the Income Statement of £1,585,592 relates to fair value measurement of the derivative component of convertible bonds issued by the Company in South Africa and the United Kingdom.
5. EVENTS AFTER THE REPORTING PERIOD
No events occurred after the reporting period which had any material impact on the financial position of the Company.
Contact details:
DiamondCorp plc
Paul Loudon, CEO
Tel: +27 56 216 1300
Euan Worthington, Chairman
Tel: +44 20 3151 0970
UK Broker & Nomad
Panmure Gordon (UK) Limited
Dominic Morley/Adam James
Tel: +44 20 7886 2500
JSE Designated Advisor
Sasfin Capital (a division of Sasfin Bank Limited)Megan Young
Tel: +27 11 445 8068
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