Half Yearly Report

10 December 2012

Mwana Africa PLC

("Mwana", the "Group" or the "Company")

Unaudited results for the six months to 30 September 2012

Mwana Africa PLC is pleased to announce its unaudited interim financial results for the six months to 30 September 2012.

Financial Highlights

·; Consolidated Group revenues up 61% to $60.7m (H1 2011: $37.6m)

·; Profit before tax of $10.1m (H1 2011: $0.7m loss)

·; Share subscription and placing of 383.0m shares in April 2012 raised approximately $32.8m net of expenses

Operational and Corporate Highlights

·; Freda Rebecca production increased by 66% to 36,335 oz of gold in the six months to September 2012 (H1 2011: 21,893 oz).

·; New strategic shareholder in China International Mining Group Corporation (CIMGC)

·; Recapitalisation and restructuring of Bindura Nickel Corporation, enabling the restart of the Trojan nickel mine. First sale of concentrate expected Q2 2013.

·; Positive drilling results at Zani Kodo with 34 holes drilled for a total of 11,047 m.

·; Cooperation and Development Agreement worth up to US$40m signed with Hailiang to jointly explore and develop 28 of SEMHKAT's licenses in the Katanga province of the DRC. Parties currently finalising joint venture agreement which will govern the joint venture relationship.

Oliver Baring, Chairman, commented today:

"The Mwana Group has achieved some major milestones during the past six months including a return to profitability.

Production at the Freda Rebecca Gold Mine continues to progress and positive drilling results from Zani Kodo, and Trojan Nickel Mine gives us confidence that we can increase significantly our resource base. The restart of the Trojan Nickel Mine at BNC as a result of the successful recapitalising and restructuring of the company bodes well for the future.

The current financial period has started well and we look forward to updating our shareholders on further progress during the balance of the financial year end."

For more information, please visit www.mwanaafrica.com or contact:

Donald McAlister / Lorenz WerndleTel: +44 (0)20 7654 5580

Liberum Capital LimitedMichael Rawlinson / Tom Fyson / Christopher KololianTel: +44 (0)20 3100 2000

Tavistock CommunicationsEd Portman / Mike Bartlett / Simon HudsonTel: +44 (0)20 7920 3150

About Mwana Africa PLC

Mwana Africa PLC is a pan-African, multi-commodity resources company. Mwana's principal operations and exploration activities cover gold, nickel, copper and diamonds in Zimbabwe, DRC and South Africa. Mwana was the first African owned and managed mining business to be listed on London's AIM market.

Mwana's Freda Rebecca gold mine in Zimbabwe restarted operations in 2009. In the year to March 2012, Freda Rebecca produced 47,770 oz of gold.

In February 2012, Mwana announced a gold mineral resource of 2.01 million oz at its Zani Kodo project in Democratic Republic of Congo.

In August 2012, Mwana announced it had entered into a Cooperation and Development Agreement with Zhejiang Hailiang Company Limited to jointly explore some of its copper licences in the Katanga Province of the DRC.

In September 2012, Mwana's subsidiary, Bindura Nickel Corporation, implemented a restructuring and recapitalisation which has allowed it to restart operations at its Trojan nickel mine. First sale of concentrate is expected in Q2 2013.

Further information on the Company can be found at www.mwanaafrica.com.

Six Month Review and Outlook

The six months to the end of September have seen us achieve considerable progress on all of our main projects. The Company achieved the best quarterly gold production at our Freda Rebecca mine since its restart in 2009. Significant headway has been made throughout the period at Bindura Nickel Corporation ("BNC"), concluding at the end of September with the successful recapitalisation and restructuring of BNC, which provides the necessary funding and conditions to restart operations at the Trojan Mine. Another significant development has been the signing of a Cooperation and Development Agreement with Zhejiang Hailiang Company Limited - a major Chinese copper producer. The joint venture agreement will accelerate exploration and development programmes at SEMHKAT, a large and prospective licence area near the Democratic Republic of Congo ("DRC") copper belt, with the potential to retain an interest of up to 40% in mining operations that might be developed. The exploration programme at Zani Kodo has continued apace at three separate targets, with further positive drill results achieved. The Company remains focused on providing shareholders with a resource update at Zani Kodo in the first quarter of 2013.

Operations at Freda Rebecca Gold Mine have performed well throughout the period, with the current annualised rate of gold production now standing at circa 72,000 oz. This makes Freda Rebecca the largest producing gold mine in Zimbabwe. The results of several efficiency programmes at the mine have been increases in milled tonnage, head grade and recoveries. A reduction in C1[1] costs to below US$800 per ounce has also been achieved, resulting in improved margins and revenue of US$59.6m during the period (H1 2011: US$36.0m). At these production levels, the current 2.3Moz gold resource will support a mine life in excess of 10 years. 

Exploration work at the Company's gold and base metals projects in the DRC has been very encouraging. At Zani Kodo, drilling has continued at the Kodo, Gombiri and Lelumodi target areas with positive drill intersections at Kodo. The year 2013 is expected to be a landmark year for the DRC gold mining industry with Randgold's Kibali project, which is in close proximity to Zani Kodo, scheduled to commence production in the second half of next year. In Q1 2013, Mwana plans to update its current 2Moz JORC resource with revised figures from this year's drilling campaign. Management remains confident that Zani Kodo has the potential to host a multi-million ounce mineable resource.

Great strides were made during the period to begin to unlock value at the Company's assets in the Katanga copper belt in the DRC. In August, agreement was reached with Hailiang, China's largest copper tube exporter and a leading manufacturer of copper products in China, to provide up to US$40m of investment into the SEMHKAT exploration area. The Katanga region of the DRC has recently become a key focus of global sector players as they compete to secure high quality assets.

In April, the Company raised US$32.8m in a share issue backed by CIMGC and supported by our institutional shareholders. This enabled the Company to invest US$21m into BNC through a rights issue. Agreeing terms with legacy BNC creditors and agreeing a retrenchment package with BNC staff were pre-requisites to the restart of BNC's Trojan mine. The restructuring and recapitalisation of BNC was successfully concluded in September and work is now focussed on restarting the Trojan mine with the sale of first nickel concentrate expected in Q2 2013. Further funding will be required by BNC to take BNC through to being cashflow positive. Post-period, Mwana reported that the resource drilling programme at Trojan had yielded a number of significant intersections of high grade nickel mineralisation. Whilst the immediate focus is on the Trojan restart, the longer term intention remains bringing Hunters Road into production and restarting the Bindura Smelter and Refinery.

Review of Operations and Exploration

Freda Rebecca Gold Mine - Zimbabwe

Freda Rebecca has continued to ramp up production. The mine produced 36,335oz of gold in the six months to September 2012, an increase of 66% from the same period last year (H1 2011 21,893oz). Average monthly production for the period was 6,055oz of gold, and the highest level of gold production achieved in a single month was in August 2012, when 7,242oz of gold was produced. Recoveries improved to 82% (H1 2011 74%)

The increase in gold produced for the six months was attributable to an increase in milled tonnage, increase in grade and improved recoveries.

 Table 1: Freda Rebecca production results for the six month periods to 30 September 2011 and 30 September 2012[2]

Table 2: Freda Rebecca key financial performance indicators for the six month periods to 30 September 2011 and 30 September 2012

In June, Mwana announced that Freda Rebecca had been awarded ISO 14001 and OHAS 18001 certification, the internationally recognised standards for sustainable environmental management and occupational health & safety management systems. Freda Rebecca maintains an excellent safety record with no fatalities and only three lost time injuries in the past 6 months of operation. Two minor environmental incidents resulted from tailings line failures. Conceptual plans for lining the tailings storage facility were approved by the Environmental Management Agency (EMA). Freda Rebecca was awarded first place in the Association of Mine Managers of Zimbabwe, Safety Health and Environment competitions for the Mashonaland region.

Bindura Nickel Corporation - Zimbabwe

On 7 June 2012, BNC announced, by way of an EGM notice to its shareholders, the commencement of a rights issue process. On 29 June 2012, BNC shareholders approved the various resolutions required to implement the recapitalisation and restructuring at BNC. On 21 September, Mwana announced that BNC had completed a rights issue and placing required to restructure and recapitalise BNC and to recommence operations. Satisfactory terms for the settlement of creditors and of liabilities relating to employee retrenchment and back pay were reached by BNC and the respective stakeholders.

New funds invested into BNC by way of the transaction totalled US$23m, including US$21m from Mwana Africa. The proceeds were sufficient to restart the Trojan Mine, although further funding will be required by BNC to provide sufficient working capital to take BNC through to positive cash flow. Various financing options are currently being considered by Mwana Africa and BNC.

Following the success of the rights issue, work commenced on the restart programme at Trojan Nickel Mine which focused on the mobilisation of the workforce, the commencement of underground operations and the refurbishment of certain components of the milling, flotation and concentrate handling facilities

BNC is planning to ramp up to a production rate of 7,000 tonnes per annum of nickel in concentrate, with first concentrate expected in Q2 2013. Nickel concentrate will be sold to Glencore International.

At Trojan a resource drilling programme is underway with the aim of confirming the down dip extension of the massive sulphide zone within the main ore body and to update the resource at Trojan. A number of significant intersections of high grade nickel were reported by Mwana on the 8th of October 2012 and 28th of November 2012.

Zani-Kodo - Democratic Republic of Congo

During the six months to 30 September 2012, exploration drilling continued with three diamond core drill rigs at three target areas with 34 holes completed for a total of 11,047 m:

§ Kodo down dip extension

§ Gombiri

§ Lelumodi

For Figure 1 map (Zani-Kodo project area showing current resources and active drill targets, Q3 2012), please click on, or paste the following link in to your web browser, to view the PDF file:

http://www.rns-pdf.londonstockexchange.com/rns/0474T_-2012-12-7.pdf 

Kodo Downdip Extension

Drilling continues to target the downdip extension of the Kodo mineralised zone. During the period a total of 15 diamond holes for 5,944 m were drilled. Drilling has continued to intersect excellent widths of visible sulphide mineralisation in both quartz veins/breccias and deformed Banded Iron Formations ("BIFs").

Selected results received for the period are summarised in Table 3 below.

Table 3: Selected results received, Kodo area, April-September 2012[3]

Excellent widths of mineralised BIF continued to be intersected, indicating good downdip continuity of the Kodo Main zone. The best width occurs in hole KDODD072 with 24m at 10.08g/t. The high grade zone narrows out to the north but remains completely open at depth. A significant addition to the current resource is anticipated in this area with a revised resource statement expected in Q1 2013.

Lelumodi

This target area is located to the east of the southerly extension of the Zani-Kodo trend (Figure 1) and is interpreted to be associated with a series of hanging wall splays. A substantial NW-SE trending gold in soil anomaly is present in this area.

Drilling initially focused on completing a full cross section of the area, with heel to toe diamond holes. Current drilling is being carried out on a 50m x 50m grid with a view to defining a resource over a strike length of 400m in the Lelumodi area. 19 holes for 5,103m were completed during the six month period. Results for the first 8 holes in this area were received:

Table 4: Selected results received, Lelumodi area, July-September 2012[4]

The results indicate the presence of multiple zones of mineralisation up to 21m in width. These zones occur in either sheared felsic tuff or BIF within a sequence dominated by metabasalts and dolerite intrusions. The zones are all close to surface and represent potential open pit material.

The presence of significant near surface mineralisation at Lelumodi has shown that soil geochemistry is an effective exploration tool and implies that further mineralisation will be present along the complete 4,000m strike length of the soil anomaly. This will be tested during 2013.

Gombiri

This target area is situated immediately south of the Zani Central area (Figure 1). Drilling was completed at the Gombiri target which is situated immediately south of Zani Central. Results were disappointing but have resulted in a re-interpretation of the Zani-Kodo trend, with mineralisation occurring in a related parallel fault zone to the East. This corresponds to the NW strike extension of the Lelumodi mineralised zone and will be targeted for drilling in 2013.

Katanga Base Metals (SEMHKAT) - Democratic Republic of Congo

On 21 August Mwana announced that it had entered into a Cooperation and Development Agreement covering 28 licences within its 100% owned SEMHKAT copper exploration area with Zhejiang Hailiang Company Limited ("Hailiang"). The parties are currently finalising a joint venture agreement which will govern the joint venture relationship.

Under the Agreement, Hailiang will invest US$25 million over a minimum period of four years to earn a 62% voting interest in the Exploration Joint Venture. Hailiang has the right at any time to transfer a licence into a development company ("DC"). Once in a DC, exploration and development of the selected licence area will be progressed further and a JORC resource report and feasibility study will be produced, and, inter alia, assuming a positive result from the feasibility study, a mine will be developed. Mwana's 38% shareholding in any DC will be non-dilutable. Hailiang has a further six month option over the Kibolwe prospect. Should they exercise this option, Kibolwe will be transferred to its own DC, in which Mwana will have a 40% non-dilutable shareholding, and, Hailiang has committed a further US$15m to Kibolwe within 12 months after the transfer of the license.

Over the six months to 30 September exploration work concentrated on Lunsano, as the major focus remains the generation of drilling targets for 2013. The Lunsano area is located 25km due south of Likasi and overlies the Roan Group of rocks with known potential for Cu-Co mineralisation. The Southern copper anomaly (6km by 1km), Northern copper anomaly (6km by 500m) and the Eastern copper anomaly (3km by 300m) all form part of the broader Lunsano geochemical anomaly.

Geological mapping in conjunction with trenching and pitting was carried out on the Northern, Southern and Eastern geochemical anomalies, with a focus on distinguishing the erosional regimes of the Lunsano terrain in order to delineate in-situ copper. Re-mapping of Mine Series Units to the SW of the Southern copper geochemical anomaly was also completed.

Detailed geological mapping of priority areas in the southern anomaly continued. The geology of the two areas was updated on plan. Mapping revealed a shaly sandstone sandwiched between the Grand Conglomerat and shale units. A strong association of high soil, trench and pit copper values with brecciated zones have been recognised, and are related to NW-SE trending structures. Visible sulphide and oxide mineralisation was encountered in some trenches.

A total of 401 pits yielding 1,208 samples were assayed by Niton hand-held XRF. The pit geology and results were updated on plan. The pit and soil sample results support each other. Some areas gave peak average copper values of 794.1ppm (P246), 600.6ppm (P448), 481.3ppm (P320A) and 154.6ppm (P389) respectively. The high copper values coincide with brecciated zones. The pit results of the northern anomaly warrant further investigation.

A total of 8,304 trench samples were assayed by Niton over this period.

AMBASE-SEMHKAT Joint Venture

Field work commenced in April. Infill soil sampling was completed on the Kasolo, Komeshia, Kabransuki, Sase, Mlalaninga, Dilungu, Gunji, Katenge, Diseba, Kikunka, Kabibangao and Kimani. A total of 3,019 samples were collected over the period.

Approximately 50% of ground geophysical surveys at Kasolo were completed. Further mag, IP, and MLEM surveys over the main target areas were scheduled for Q4.

The Katenge target combines a soil geochem anomaly with coinciding SPECTREM EM, as well as a vegetation anomaly (possible Cu clearing). At least one of the holes intersected visible Cu mineralisation in form of malachite in carbonaceous and partially pyritic shale on the base of the Grand Conglomerat. NITON analysis of the holes is pending.

Positive results from infill soil sampling and shallow RC drilling during Q3 has prompted the establishment of further drill access tracks (8.2km completed) at the Katenge, Kikunka and Kabibangao targets.

A reverse circulation ("RC") drilling rig was mobilised to Maina Camp and commenced drilling in May. A second multi-purpose RC/DD rig was mobilised in June.

A total of 302 holes both RAB and RC, yielding 10,551m were completed in Q3.

The majority of these holes were drilled as shallow RC scout holes over soil geochemistry anomalies or as deeper follow-up holes, either directly testing targets from earlier shallow RC or drilled as pre-collars for later diamond drill extensions.

Most of the targets drill-tested over Q3 have been abandoned due to low grades returned. In most cases the Cu (and sometimes Ni) is associated only with a Fe-rich weathering zone just above the fresh rock, where Cu typically reaches concentrations of up to 0.3% Cu, and then rapidly drops off as drilling intersect fresh rock.

Gunji delivered the best results so far with an 18m showing visible malachite and NITON assays of 0.6% Cu (maximum of 1.1% Cu over 2m).

Diamond drilling is on-going and so far, 11 DD holes totalling 1001m have been drilled.

The DD holes at Kasolo intersected mainly altered limestone, dolomite, and tectonic talcose breccias. Minor chalcocite was observed in the breccias with malachite and native Cu occupying limestone fractures. Assays are still to be done.

DD holes at Gunji were drilled in order to complement the existing deeper RC holes. These holes appear to confirm the inferred moderate south-westerly dip of the strata. Both holes intersected brecciated saprolite before grading into fresh dolomite and dolomitic shale at depth.

No significant Cu mineralisation could be recorded in fresh rock, confirming earlier observations in RC holes, which indicate Cu predominantly being concentrated in the deeper weathering zone near the interface to the fresh rock.

Klipspringer Diamond Mine - South Africa 

Management continue to review options for the Klipspringer mine which remained on care and maintenance for the period. 

Diamonds - other interests

Mwana Africa has minority stakes in a number of other diamond projects including a 20% interest in Societe Miniere de Bakwanga (MIBA) in the DRC, an 18% interest in the Camafuca project in Angola and 55% interest in the BK16 project in Botswana.[5]

Financial Review

Income Statement

The Group reported revenue of $60.7m for the period (H1 2011: $37.6m). Freda Rebecca generated $59.7m (H1 2011: $36.0m) from the sale of 36,335oz. (H1 2011: 21,893oz) of gold.

The Group generated a gross profit of $33.1m for the period (H1 2011: $17.2m), $32.3m at Freda Rebecca and $0.8m at BNC which continued to dispose of inventory items.

Operating costs of $49.6m (H1 2011: $39.0m) increased from the previous year due to increased activity at Freda Rebecca with the introduction of the second milling circuit where costs for the period rose to $34.9m (H1 2011: $24.5m).

No impairment nor reversal of impairment of assets was recorded in the period. The Group reported a profit before tax of $10.1m (H1 2011: Loss of $0.7m). 

Cashflow

During the period the Company raised $32.4m through an equity issue. This was achieved through the placing of and subscription for 383,042,447 new ordinary shares in April.

Cashflow from operations of $19.8m was generated by the Group during the period. $29.7m of operational cash generated by Freda Rebecca was offset by $6.4m spent on the continued care and maintenance program at BNC, $1m on care and maintenance at Klipspringer diamond mine, and $2.6m on other corporate costs. $3.1m was absorbed by working capital, resulting mainly from the repayment of creditors outstanding at the year-end as well as payments received from debtors. Financing costs were $0.2m, and income tax charges of $5.6m mainly on the profits of Freda Rebecca resulting in net cash generated from operations of $10.8m.

Capital investment comprised $4m (H1 2011: $4.6m) on property, plant and equipment, principally at Freda Rebecca, and a further $6.6m (H1 2011: $4.6m) on exploration assets.

Capital commitments at the end of the period comprised of $775k at BNC and $1,246k at Freda Rebecca. The Group plans to spend an additional $14,910k by the end of this financial year on the restart program at the Trojan Mine.

At 30th September 2012, the Group, held cash balances of $39.9m (H1 2011: $15.3m). 

Restructuring and re-financing of the Trojan Mine restart.

BNC completed a rights issue and a placing on 17th September 2012. New funds invested into BNC by way of the transaction totalled US$23m, including US$21m from Mwana Africa. In addition as part of the placing, external creditors amounting to $4.7 million and labour settlement of $1.1 million were converted into BNC shares. The rights issue resulted in an increase in BNC's share capital of $31.4million.

A prerequisite to the rights issue was satisfactory agreement on labour liabilities and retrenchment provisions and payables. Movements in labour provisions are summarised in the table below:

$3.4 million was paid after the period end being the first payment to retrenchees and $8.5 million has been deferred to December 2014, to be settled in cash of $6.5 million and mining houses for $2.0million. This amount is classified as non-current liabilities.

Condensed Group balance sheet

As at 30 September 2012

(Unaudited)

Condensed Group income statement

For the six months ended 30 September 2012

(Unaudited)

Condensed Group statement of comprehensive income

For the six months ended 30 September 2012

(Unaudited)

Condensed Group statement of changes in equity

For the six months ended 30 September 2012

(Unaudited)

Condensed Group statement of changes in equity (continued)

For the six months ended 30 September 2012

(Unaudited)

Condensed Group cash flow statement

For the six months ended 30 September 2012

(Unaudited)

1. Reporting entity

Mwana Africa PLC (the "Company") is a company domiciled in the United Kingdom. The condensed consolidated interim financial statements of the Company as at and for the six months ended 30 September 2012 comprise the Company and its subsidiaries (together referred to as the "Group") and the Group's interests in associates and jointly controlled entities. The audited consolidated financial statements of the Group as at and for the year ended 31 March 2012 are available upon request from the Company's registered office at 43 Palace Street, London, SW1E 5HL or at www.mwanaafrica.com.

2. Statement of compliance

These condensed financial statements have been prepared in accordance with International Accounting Standard ("IAS") 34, Interim Financial Reporting, as adopted by the EU. These condensed financial statements have been prepared using the same accounting policies as used in the preparation of the Group's annual financial statements for the year ended 31 March 2012, which were prepared in accordance with International Financial Reporting Standards as adopted by the EU ("IFRS"). They do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated financial statements of the Group for the year ended 31 March 2012. The financial information presented in this document is unaudited.

The comparative figures for the financial year ended 31 March 2012 are not the Company's statutory accounts for that financial year. Those accounts have been reported on by the Company's auditor and delivered to the Registrar of Companies. The report of the auditor was unqualified, included emphasis of matter paragraphs in which the auditor drew attention to significant uncertainties that may cast significant doubt regarding going concern and the carrying value of investments, and did not contain a statement under section 498(2) or (3) of the Companies Act 2006. These sections address whether proper accounting records have been kept, whether the Company's accounts are in agreement with those records and whether the auditor has obtained all the information and explanations necessary for the purposes of its audit.

3. Going concern

The Directors, having considered the Group's and the Company's current trading activities, funding position and projected funding requirements and the Zimbabwean environment for the period at least twelve months from the date of approval of these Interim Financial Statements, consider it appropriate to adopt the Going Concern basis in preparing the Interim Financial Statements for the six months ended 30th of September 2012.

The Group's business activities, together with the factors likely to affect its future development, performance and position are set out in the Operational Review on pages 4 to 10. The financial position of the Group, its cashflows and liquidity position are as set out in the Financial Review on pages 11 to 28. 

The group reports a profit for the six months ended 30 September 2012 of US$4 million (H1 2011 Loss of: US$4.2 million). As at 30 September 2012, the group held cash of US$39.9 million, of which US$22 million is held by BNC.

During the six months to 30 September 2012, gold production at Freda Rebecca has continued to ramp up with production averaging 6,055 oz per month. The operating cash flows from Freda Rebecca represent a strengthening of the Group's cash generating ability.

Following the restructuring and recapitalisation of Bindura Nickel Corporation ("BNC") in September 2012, BNC's Trojan mine has come off care and maintenance and is currently being brought back into production. This significantly reduces the care & maintenance cost burden which BNC has represented in Mwana's cash flows in recent years. However, the Directors expect that after BNC commences sales of nickel concentrate it will require further funding within the next twelve months to fund working capital requirements to take BNC through to being cash flow positive. The Directors are confident that this funding can be secured given that Trojan is expected to be revenue generative by that time. 

Discussions are on-going with the Zimbabwean Government pertaining to the implementation of the country's Indigenisation Act in relation to Mwana's Zimbabwean assets. The Indigenisation Act presents a level of uncertainty around Mwana's ability to manage cash flow from its Zimbabwean entities. Furthermore, the lack of clarity around indigenisation makes it harder for Mwana to raise funding as required for its Zimbabwean assets.

The Directors have prepared the cash flow forecasts of the Group and are of the opinion that the Group's current cash resources, together with the cash forecast to be generated by Freda Rebecca, are sufficient to fund all of the Group's planned activities (excluding BNC) for at least twelve months from the date of these Financial Statements. BNC is expected to require further funding during the course of the next twelve months. 

The Directors are aware that various uncertainties might affect the validity of their forecasts. These uncertainties include metal prices, mining and processing risks and resource and reserve risks, in addition to the political and indigenisation risks in Zimbabwe. The Directors, however, believe they have the ability to manage cash flows by deferring exploration spend if necessary and implementing indigenisation proposals in such a way to minimise the cash flow impact to the Group. However, the Directors acknowledge that there is no certainty of successfully carrying out such mitigating steps.

The Directors have concluded that the combination of these circumstances represents a material uncertainty that may cast significant doubt on the Company's and the Group's ability to continue as a going concern and that therefore the Company and the Group may be unable to realise all their assets and discharge all of their liabilities in the normal course of business. 

Nevertheless, after making enquiries and considering the uncertainties described above the Directors have a reasonable expectation that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future. Accordingly they continue to adopt the going concern basis in preparing these Financial Statements which do not include any adjustments that would result from the going concern basis of preparation being inappropriate

4. Significant accounting policies

In the preparation of thesecondensed financial statements, the Group has applied the same accounting policies as those presented in the Group's consolidated financial statements for the year ended 31 March 2012, as set out on pages 43 to 50 of the Annual Report, as adjusted for the effects ofthe following amendments to published standards and interpretations are effective for the Group for the half year ended 30 September 2012:

·; Amendments to IFRS 7 Financial Instruments: Disclosures, which is effective for accounting periods beginning on or after 1 July 2011, requires additional disclosures about transfers of financial assets. The amendments also require additional disclosures if a disproportionate amount of transfer transactions are undertaken around the end of a reporting period.

The Group has reviewed the effect of these amendments and interpretations, and has concluded that they have no material impact on these condensed consolidated interim financial statements.

The Group is currently assessing the potential impacts of the other new and revised standards and interpretations that will be effective from 1 April 2013 and beyond, and which the Group has not early adopted. The Group does not anticipate that these will have a material impact on the Group's overall results and financial position.

5. Operating segments

The Group has four reportable segments, as described below, which are the Group's strategic business units.

The strategic business units offer different products and services, and are managed separately because they require different technology and marketing strategies.

The following summary describes the operations in each of the Group's reportable segments:

·; Gold: Gold mining activities

·; Nickel: Nickel mining. Smelting and refining activities are currently on care and maintenance

·; Diamonds: Diamond mining activities currently on care and maintenance

·; Exploration: Gold and base metal exploration activities

Information about reportable segments - Operations