17th Aug 2010 07:00
Central Rand Gold Limited
("CRG" or the "Company" or the "Group")
(Incorporated as a company with limited liability under the laws of Guernsey,
Company Number 45108)
(Incorporated as an external company with limited liability under the laws of
South Africa, registration number 2007/0192231/10)
ISIN: GG00B24HM601
Share code on LSE: CRND
Share code on JSE: CRD
2010 Interim Report
Central Rand Gold, the South African gold mining and exploration holding company, today announces its Interim Results for the six months ended 30 June 2010. The full set of results is available on the Company's website: www.centralrandgold.com
For further information, please contact:
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CRG |
+27 (0) 11 674 2304 |
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Johan du Toit / Patrick Malaza |
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Evolution Securities Limited |
+44 (0) 20 7071 4300 |
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Simon Edwards / Chris Sim / Neil Elliot |
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Macquarie First South Advisers (Pty) Ltd |
+27 (0) 11 583 2000 |
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Annerie Britz/ Melanie de Nysschen/ Manisha Ramlakhan |
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Buchanan Communications |
+44 (0) 20 7466 5000 |
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Bobby Morse / James Strong / Katharine Sutton |
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Jenni Newman Public Relations (Pty) Ltd |
+27 (0) 11 506 7350 |
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Jenni Newman |
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17 August 2010
Johannesburg
JSE Sponsor
Macquarie First South Advisers (Pty) Limited
Chief Executive Officer's Review
Although the first half of 2010 was a challenging period for CRG, we have made significant strides forward, moving from trial mining to our goal of building a platform for a sustainable and profitable gold mine. Highlights for the Company during this period included:
• Trial mining phase completed;
• Successful fundraising initiative to enable the Company to advance the project to commence sustainable gold production;
• Order placed for submersible pumps and discussions progressing with government regarding the rising water table solution;
• Underground development progressing well - decline development at 158 metres below surface; reef development on three levels;
• Second Jumbo DD420 double boom drill rig delivered;
• Improvement in performance and recoveries from metallurgical plants;
• Optical ore sorter ordered for expected delivery in January 2011 and
• Progress in cost containment
During the first half of 2010, the Company produced a total of 3,368 ounces of gold. The Company's cash position at 30 June 2010 was US$4.0 million, with a cash position, following the fundraising, of US$36.4 million as at 31 July 2010.
Fundraising
After completing a US$6.0 million "Cashbox" placing on 22 January 2010 to enable trial mining to be completed, CRG successfully raised US$35.0 million through a "Firm Placing, Placing and Open Offer" on 5 July 2010, which was fully underwritten by Evolution Securities (together the "Fundraising"). These funds will provide the essential capital needed to finance the next stage of mining progression which will include reef development and the acquisition of further necessary mining equipment.
OPERATIONAL UPDATE
Trial Mining
The objectives of trial mining were to validate the mining method and provide real physical and financial data for input into the mine design.
The trial mining, and subsequently updated Competent Person Report ("CPR") by Snowden Mining Industry Consultants, corroborated an updated mine plan which is expected to produce 476,190 ounces of gold over a mine life of 12 years with an average operational cash (including water pumping costs) and capital costs of US$582/oz and US$173/oz respectively from CMR West, one of the Company's tenement areas. Extensions of mineralised reef zones (partings), sweepings and vampings and remnant reef pillars have also been identified as other readily available potential sources of gold but have not been incorporated in this mine plan.
Mining
With the completion of trial mining, the focus now shifts to developing the underground infrastructure to ensure that sustainable production can commence. The first half of the year has been focussed on decline development to provide the operations with sufficient access for reef development whilst opening early cash flow opportunities on identified surface materials. Total development advance to date is sitting at 1,256.1 metres with 38,497 tons of underground ore and 45,664 tons of surface material.
|
Key mining statistics |
Metres development |
Tonnes |
Fully diluted grams per tonne ("g/t") |
|
Decline and waste development |
1,014.3 |
N/A |
N/A |
|
Reef development |
241.8 |
32,424 |
1.6 |
|
Trial mining stoping |
|
6,073 |
2.6 |
|
Surface |
|
45,664 |
2.9 |
|
Total mining production |
1,256.1 |
84,161 |
|
The decline development has reached 158 metres below surface. Reef development has commenced on three levels, with the first level at 121mbs. Ground conditions experienced to date, have been variable for the reef development, which has required additional hanging wall support being introduced. The management team is considering various optimisation opportunities, with the potential for greater efficiencies and effectiveness that will complement the current mining methodology.
A second Jumbo DD420 double boom drill rig was delivered to site at the end of July 2010. This is expected to further increase monthly development rates.
Geology
During March 2010, the Probable Ore Reserve was upgraded to 3.73 million tonnes with an average grade of 4.0 grams per tonne, yielding 482,000 ounces of gold.
Further Confirmation of Resource Model
Channel sampling of underground development ore undertaken to date has fully supported the Australasian Joint Ore Reserves Committee ("JORC") / South African Code for Reporting of Exploration Results, Mineral Resources and Mineral Reserves ("SAMREC") Indicated Resource, as previously defined and reported. The in-situ grade, grade above cut-off and overall block payability (i.e. the percentage of the block above cut-off) appears to be very predictable and robust. However, the specific high grade locations within the block are more variable. A comparison of average block characteristics is presented in the table below.
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|
Theoretical |
Actual |
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|
Development |
Block |
In-situ (g/t) |
C-O (g/t) |
Pay % |
Ave Width (cm) |
Ave (g/t) |
In-situ (g/t) |
C-O (g/t) |
Pay % |
Ave Width (cm) |
Ave (g/t) |
|
1596 |
CMR 46 |
3.04 |
3 |
46% |
151 |
4.67 |
3.81 |
3 |
35% |
100 |
9.18 |
|
1581 |
CMR 33 |
3.55 |
3 |
50% |
112 |
5.29 |
8.80 |
3 |
80% |
100 |
10.58 |
|
1580 |
CMR 33 |
3.55 |
3 |
50% |
112 |
5.29 |
0.83 |
3 |
0% |
100 |
0.83 |
|
1575 |
CMR 33 |
3.55 |
3 |
50% |
112 |
5.29 |
4.53 |
3 |
62% |
100 |
6.21 |
|
1563 |
CMR 33 |
3.55 |
3 |
50% |
112 |
5.29 |
4.39 |
3 |
72% |
111 |
5.36 |
|
1551 |
CMR 33 |
3.55 |
3 |
50% |
112 |
5.29 |
5.77 |
3 |
100% |
101 |
5.77 |
|
|
|
|
|
|
|
|
|
|
|
|
|
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Averages |
3.43 |
3 |
49% |
122 |
5.14 |
4.26 |
3 |
51% |
102 |
6.26 |
|
|
CMG/T |
416 |
- |
- |
- |
624 |
436 |
- |
- |
- |
642 |
|
|
G/t over 122 cm |
3.43 |
- |
- |
- |
5.14 |
3.59 |
- |
- |
- |
5.28 |
|
In particular, the gold accumulation (cmg/t) and equivalent gold grade over a standardised width of 122cm for the sampled development, closely approximates that described by the Theoretical Model.
Surface Exploration Target*
Exploration trenching has continued to the east and west of the process plant. Two additional potential new open pit mining areas have been delineated which offer the opportunity to generate further gold production from surface areas:
Note 1:
* The potential quantity and grade described by the term "Exploration Target" is conceptual in nature and there has been insufficient exploration to define a Mineral Resource. It is uncertain if further exploration will result in the definition of a Resource. Further exploration work is ongoing, and includes trial mining and processing of this shallow target to establish grade and orebody continuity, mineability, dilution and throughput characteristics.
The information in this statement relating to Mineral Resources and geology has been reviewed and approved by Mr Keith Matier, BSc (Hons),GDE,Pr Sci Nat, who is a competent person in terms of the SAMREC and JORC codes. Mr Matier is Geology Manager of Central Rand Gold South Africa (Pty) Ltd and has over 17 years experience in exploration, mineral resource management and mineral evaluation.
DS Open Pit Block
To the east of the plant, trenching has exposed approximately 80m of in-situ Main Reef Leader, Main Reef and Mineralised Middling. Material exposed can be extracted through free digging and is open at depth. Combined assay results for material exposed thus far are as follows:
• Main Reef Leader: 6.4 g/t over 58cm;
• Middling: 2.2g/t over 47cm;
• Main Reef: 3.6g/t over 70cm; and
• Total Package: 4.2g/t over 175cm.
An estimated exploration target of between 22,000 tonnes and 28,000 tonnes has been discovered in these areas with composite grades of between 3.3g/t and 3.8g/t.
KF Open Pit Block
To the west of the process plant, exploration trenching has exposed approximately 160m of Main Reef package. The material exposed is amenable to free digging, although between 3m and 5m of overburden and backfill is present. The Main Reef averages approximately 7.1g/t over a diluted 102cm width with occasional Main Reef Leader remnant pillars present, grading up to 290g/t.
An estimated exploration target of between 27,000 tonnes and 55,000 tonnes has been discovered in this area with composite grades of between 7.1g/t and 7.5g/t.
Metallurgy
The Bateman concentrator has processed 37,851 tonnes with 21.4% mass pull factor producing 8 108 tonnes of concentrate at 3.5 g/t for the six months to 30 June 2010. A higher-than-expected flotation recovery of 75% on low grade at 1.4 g/t, predominantly oxide material was achieved despite lower than planned availability at 59%.
Direct feed to the carbon-in-pulp ("CIP") for the period was 33,120 tonnes at 3.2g/t. A total of 41,228 tonnes, including the Bateman concentrate, have been processed through the CIP for the six months ended 30 June 2010, with year to date availability at 87%, 2% above forecast with an acceptable recovery of approximately 89% on oxide material.
In total 70,971 ROM tonnes were fed to both Bateman and CIP plant during the period to end June 2010.
Following the improvements that have been made to the metallurgical plants earlier in the year, the emphasis has shifted to maximising throughput and recoveries, and establishing accurate metal accounting to enable refinement of all metallurgical processes.
Water Table
Good progress has been made regarding the rising water-table that affects the Company's mining operations. If this water, also known as acid mine drainage ("AMD"), is allowed to decant onto the surface, it will have serious environmental and ultimately economic implications for the Gauteng area. Due to the seriousness of this problem, discussions have been escalated to the highest level of government. In broad terms, there is an understanding between all stakeholders, on an interim solution, which will include the construction of a submersible pump station at 400mbs, the refurbishment of the existing high density sludge plant and the construction of a pipeline connecting the Western and Central basins. The Minister of the South African Department of Water Affairs, Minister Buyelwa Sonjica, speaking at the Agri SA water conference in Johannesburg on 11 August 2010, confirmed that the South African government recognised that as 70% of the mining area in the Witwatersrand district is currently ownerless and the liability to resolve the AMD problem would reside with the State, requiring a contribution of approximately US$19.8 million (ZAR145.0 million). The remaining 30% liability would be funded by existing active mining operations in the area.
To limit the extent that the water table will rise above the 400mbs level, the Company has placed an order for the submersible pumps, which are the project's longest lead item. The initial payment of US$1.3 million (ZAR10 million) will form part of CRG's total committed contribution of US$5.0 million (ZAR36.0 million).
Corporate Overhead
Cost containment continues to be a key focus for the Company. As part of this process, a total of 46 support staff accepted redundancy packages, reducing the support payroll costs by 28%. With effect from the beginning of July 2010, the head office building in Killarney was vacated, with all functions moving to the existing operational offices at Rand Leases, Roodepoort, which will result in significant savings going forward.
Management and Directorate
Don Harper resigned as CRG's Head of Mining at the end of June 2010, due to family reasons, but will still be available to the Company in a consultancy capacity until the end of September 2010. The Group's thanks goes to him for his valuable contribution towards reconfiguring and refocusing CRG's mining operations. A recruitment process is at an advanced stage to find a replacement. In the interim, John Ramabaleha is acting as the Head of Mining, with the continuing support of the mining contractors, Australian Contract Mining ("ACM").
In February 2010, Patrick Malaza and Jerome Brauns were appointed to the Board of Directors (the "Board") as Finance Director and Non-Executive Director, respectively.
In April 2010 the following changes were made to the Board:
• Michael McMahon succeeded Alastair Walton as the CRG Chairman; and
• Robert Kirby resigned as a Non-Executive Director.
Black Economic Empowerment
Funding Call and Call Option: Arbitration
Puno Gold Investments (Proprietary) Limited ("Puno"), the 26% shareholder in Central Rand Gold SA, has failed to institute the arbitration proceedings envisaged by an Order of the South Gauteng High Court in May 2009, in order to resolve the dispute surrounding the minority shareholder's funding obligations and the validity of the Company's call option in respect of their shares as a consequence. Attempts to resolve the dispute amicably have been explored to no avail. In the circumstances, the Company is now taking steps to ensure that the arbitration proceedings be heard as soon as possible and has itself taken steps in order to have an arbitrator appointed.
Damages Claim
Puno has issued a summons on the Company, claiming damages to the value of US$17 million. This action, instituted by Puno against the Company out of the South Gauteng High Court, Johannesburg, traverses issues similar to those covered by Puno's previous application. In particular, Puno's damages claim is premised on a similar interpretation of the Shareholders' Agreement as it contended for in the previous application.
The previous application was dismissed by Acting Judge, Alan Horwitz SC, on Thursday, 5 November 2009, with costs, including the costs of two counsel on the grounds that Puno had failed to make out a case for the relief sought on each ground which formed the subject of the application hearing. Puno's application for leave to appeal against the judgment was also dismissed with a similar order as to costs. In relation to Puno's interpretation of the Shareholders' Agreement, the Acting Judge expressly rejected the interpretation on which the present action seeks to rely.
It is the Company's considered view that the present action is equally ill-founded, and possibly vexatious, and while Puno has in any event failed to take proper and appropriate steps in the institution of these proceedings on which basis alone the present action must be stayed, Puno's contentions for the relief sought are considered to be flawed and devoid of merit.
In consequence, the Directors are of the opinion that in as much as the action has no prospects of success, this will not have any material consequences in respect of the consolidated accounts of the Group.
Financial Review
Operating loss for the period decreased by 22% to US$17.4 million (30 June 2009: US$22.4 million). This is mainly attributed to:
• Revenue from the sale of 3,085 ounces of gold processed from initial underground development ore, trial stoping and shallow surface materials;
• Processing plant shutdown and consequent repair and reconfiguration costs;
• Provision for voluntary retrenchment of 46 head office and support staff;
• Full half year depreciation and amortisation of mine assets and
• Impairment of redundant processing plant.
Net loss for the period increased 19% to US$17.3 million (30 June 2009: US$14.6 million) mainly attributed to lower interest received and lower foreign exchange gains on the back of lower cash balances.
The net cash position is reported at approximately US$4.0 million (30 June 2009: US$46.4 million). The Company's cash position, following the Fundraising, is $36.4 million as at 31 July 2010. Major cash flows during the period are set out in the abridged cash flow statement below:
|
|
US$'million |
|
Cash and cash equivalents at 1 January 2010 |
15.9 |
|
Cash used in operations |
(13.7) |
|
Interest received |
0.3 |
|
Mine property, plant and equipment |
(7.8) |
|
Security deposits - Redemption |
0.5 |
|
Proceeds from share issue |
6.0 |
|
Effects of exchange rate movement on cash balances |
2.8 |
|
Cash and cash equivalents at 30 June 2010 |
4.0 |
Outlook
With trial mining now completed, the Group is committed to achieving the implementation of sustainable and profitable gold mining operations.
The second half of 2010 will focus mainly on establishing CRG's underground mining operations, having made good progress in the first half, with 1,256 metres of development completed. The Company will continue to seek to optimise its mining methodology thereby improving the speed that it can access mineable reef when poor ground conditions are encountered.
As outlined at the time of the Fundraising in June 2010, the Company will also focus on securing its mining fleet. The global increase in the demand for mining equipment has resulted in delivery lead times increasing substantially over the last six months. The successful Fundraising has enabled the Company to have meaningful discussions with various equipment suppliers in an attempt to secure essential underground mining equipment. Until the Fundraising was completed it was not possible to contract for the additional equipment, the most significant being a Long Hole Rig, which is required to commence underground stoping. Any delay in delivery could have short term production implications as the 2010 production forecast predominantly relies on the processing of higher grade underground ore. In order to mitigate these effects, extended surface exploration and surface mining have been undertaken to ensure the optimal utilisation of metallurgical plants. The Company will continue with its underground mine development programme, establishing stoping blocks, while it awaits confirmation of delivery of the Long Hole Rig.
From a metallurgy point of view, the emphasis will be on successfully implementing the optical ore sorter, which is expected to be delivered in January 2011. We have retained the option to rent an ore sorter in the interim, should underground production ramp up prior to delivery of the new unit. The ore sorter will provide an effective mechanism to remove waste from underground ore linked to the mining method being utilised. It will also deal with dilution and provide an efficient way of "high grading" material so that recoveries can be maximised.
Another important emphasis will be the completion of the feasibility study by early 2011 relating to CMR East, which is the Company's next development target.
During the first half of 2010, the Company produced a total of 3,368 refined ounces of gold, in line with management expectations. The second half of 2010 promises to be an exciting period for CRG, as it will build on the trial mining experience and create a platform for strong development and production progress to be made in the years that lie ahead.
Johan du Toit
|
Condensed Group Income Statement for the six months ended 30 June 2010 |
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
30 June |
|
31 December |
|
30 June |
|
|
|
|
|
2010 |
|
2009 |
|
2009 |
|
|
|
|
|
US$ '000 |
|
US$ '000 |
|
US$ '000 |
|
|
|
|
Notes |
(Unaudited) |
|
(Audited) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Employee benefits expense |
|
(5,546) |
|
(9,688) |
|
(5,027) |
|
|
|
Directors' emoluments |
12 |
(534) |
|
(1,676) |
|
(925) |
|
|
|
Depreciation and amortisation |
|
(1,445) |
|
(2,479) |
|
(911) |
|
|
|
Inventory write down |
|
(420) |
|
(1,947) |
|
(1,076) |
|
|
|
Operating lease expense |
|
(310) |
|
(833) |
|
(689) |
|
|
|
Exploration and evaluation expenditure |
13 |
(5,249) |
|
(33,696) |
|
(11,061) |
|
|
|
Other expenses |
|
(3,873) |
|
(5,956) |
|
(2,680) |
|
|
|
Operating loss |
|
(17,377) |
|
(56,275) |
|
(22,369) |
|
|
|
Interest receivable |
|
772 |
|
3,996 |
|
2,458 |
|
|
|
Finance costs |
|
(500) |
|
(1,108) |
|
(329) |
|
|
|
Foreign exchange transaction gains |
|
367 |
|
7,596 |
|
6,085 |
|
|
|
Other income and gains |
|
6 |
|
2 |
|
- |
|
|
|
Loss before income tax |
|
(16,732) |
|
(45,789) |
|
(14,155) |
|
|
|
Income tax expense |
14 |
(617) |
|
(546) |
|
(399) |
|
|
|
Loss for the period |
|
(17,349) |
|
(46,335) |
|
(14,554) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss is attributable to: |
|
|
|
|
|
|
|
|
|
Non-controlling interest |
|
- |
|
- |
|
- |
|
|
|
Equity holders of the parent |
|
(17,349) |
|
(46,335) |
|
(14,554) |
|
|
|
|
|
(17,349) |
|
(46,335) |
|
(14,554) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares in issue |
|
271,611,610 |
|
246,919,650 |
|
246,919,650 |
|
|
|
Weighted average number of ordinary shares in issue |
|
268,746,797 |
|
246,919,650 |
|
246,919,650 |
|
|
|
Fully diluted weighted average number of ordinary shares in issue |
|
268,746,797 |
|
246,919,650 |
|
246,919,650 |
|
|
|
Basic loss per share (cents) |
|
(6.46) |
|
(18.77) |
|
(5.89) |
|
|
|
Headline loss per share (cents) |
|
(5.46) |
|
(17.15) |
|
(5.62) |
|
|
|
Diluted loss per share (cents) |
|
(6.46) |
|
(18.77) |
|
(5.89) |
|
|
|
Diluted headline loss per share (cents) |
|
(5.46) |
|
(17.15) |
|
(5.62) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation between loss attributable to the equity holders of the Group and the headline loss attributable to the equity holders of the Group: |
|
|
|
|
|
|
|
|
|
Loss attributable to equity holders of the Group |
|
(17,349) |
|
(46,335) |
|
(14,554) |
|
|
|
Provision for restructuring |
|
616 |
|
- |
|
472 |
|
|
|
Loss on measurement of non-current assets held for sale to fair value, less costs to sell |
|
2,159 |
|
3,496 |
|
- |
|
|
|
(Profit)/loss on disposal of property, plant and equipment |
|
(98) |
|
501 |
|
217 |
|
|
|
Headline loss attributable to equity holders of the Group |
|
(14,672) |
|
(42,338) |
|
(13,865) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed Group Statement of Comprehensive Income for the six months ended 30 June 2010 |
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
30 June |
|
31 December |
|
30 June |
|
|
|
|
2010 |
|
2009 |
|
2009 |
|
|
|
|
US$ '000 |
|
US$ '000 |
|
US$ '000 |
|
|
|
|
(Unaudited) |
|
(Audited) |
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Loss for the period |
|
(17,349) |
|
(46,335) |
|
(14,554) |
|
|
Other comprehensive income: |
|
|
|
|
|
|
|
|
Exchange differences on translating foreign operations |
|
(3,245) |
|
14,500 |
|
12,610 |
|
|
Income tax relating to components of other comprehensive income |
|
- |
|
- |
|
- |
|
|
Other comprehensive income for the period, net of tax |
|
(3,245) |
|
14,500 |
|
12,610 |
|
|
Total comprehensive income for the period |
|
(20,594) |
|
(31,835) |
|
(1,944) |
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income is attributable to: |
|
|
|
|
|
|
|
|
Non-controlling interest |
|
- |
|
- |
|
- |
|
|
Equity holders of the parent |
|
(20,594) |
|
(31,835) |
|
(1,944) |
|
|
|
|
(20,594) |
|
(31,835) |
|
(1,944) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed Group Statement of Financial Position as at 30 June 2010 |
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
30 June |
|
31 December |
|
30 June |
|
|
|
|
|
2010 |
|
2009 |
|
2009 |
|
|
|
|
Notes |
US$ '000 |
|
US$ '000 |
|
US$ '000 |
|
|
|
|
|
(Unaudited) |
|
(Audited) |
|
(Unaudited) |
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
|
NON CURRENT ASSETS |
|
|
|
|
|
|
|
|
|
Property, plant and equipment |
5 |
31,339 |
|
34,298 |
|
30,712 |
|
|
|
Intangible assets |
7 |
1,282 |
|
1,316 |
|
1,251 |
|
|
|
Security deposits and guarantees |
|
5,641 |
|
5,806 |
|
- |
|
|
|
Loans receivable |
8 |
8,065 |
|
7,818 |
|
6,626 |
|
|
|
|
|
46,327 |
|
49,238 |
|
38,589 |
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT ASSETS |
|
|
|
|
|
|
|
|
|
Security deposits and guarantees |
|
185 |
|
510 |
|
6,686 |
|
|
|
Prepayments and other receivables |
|
4,446 |
|
5,272 |
|
5,176 |
|
|
|
Inventory |
9 |
1,205 |
|
1,574 |
|
4,142 |
|
|
|
Cash and cash equivalents |
|
3,945 |
|
15,899 |
|
46,449 |
|
|
|
Non-current assets held for sale |
6 |
8,780 |
|
2,750 |
|
- |
|
|
|
|
|
18,561 |
|
26,005 |
|
62,453 |
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
64,888 |
|
75,243 |
|
101,042 |
|
|
|
|
|
|
|
|
|
|
|
|
|
EQUITY AND LIABILITIES |
|
|
|
|
|
|
|
|
|
Attributable to equity holders of the parent |
|
|
|
|
|
|
|
|
|
Share capital |
10 |
5,424 |
|
5,023 |
|
5,023 |
|
|
|
Share premium |
10 |
197,017 |
|
191,406 |
|
191,406 |
|
|
|
Share-based compensation reserve |
|
28,296 |
|
27,482 |
|
26,644 |
|
|
|
Treasury shares |
|
(6) |
|
(2) |
|
(2) |
|
|
|
Foreign currency translation reserve |
|
(31,645) |
|
(28,400) |
|
(30,290) |
|
|
|
Accumulated losses |
|
(156,174) |
|
(138,825) |
|
(106,859) |
|
|
|
|
|
42,912 |
|
56,684 |
|
85,922 |
|
|
|
Non-controlling interest |
|
- |
|
- |
|
- |
|
|
|
TOTAL EQUITY |
|
42,912 |
|
56,684 |
|
85,922 |
|
|
|
|
|
|
|
|
|
|
|
|
|
NON CURRENT LIABILITIES |
|
|
|
|
|
|
|
|
|
Environmental rehabilitation and other provisions |
11 |
1,460 |
|
1,434 |
|
39 |
|
|
|
Loan payable |
|
8,065 |
|
7,818 |
|
6,626 |
|
|
|
Operating lease liability |
|
- |
|
26 |
|
41 |
|
|
|
Borrowings |
|
1 |
|
12 |
|
35 |
|
|
|
|
|
9,526 |
|
9,290 |
|
6,741 |
|
|
|
|
|
|
|
|
|
|
|
|
|
CURRENT LIABILITIES |
|
|
|
|
|
|
|
|
|
Trade and other payables |
|
8,155 |
|
7,620 |
|
6,413 |
|
|
|
Environmental rehabilitation and other provisions |
11 |
2,805 |
|
701 |
|
1,206 |
|
|
|
Taxation payable |
|
1,461 |
|
895 |
|
709 |
|
|
|
Operating lease liability |
|
4 |
|
26 |
|
13 |
|
|
|
Borrowings |
|
25 |
|
27 |
|
38 |
|
|
|
|
|
12,450 |
|
9,269 |
|
8,379 |
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITES |
|
21,976 |
|
18,559 |
|
15,120 |
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL EQUITY AND LIABILITIES |
|
64,888 |
|
75,243 |
|
101,042 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed Group Statement of Changes in Equity for the period ended 30 June 2010 |
|
|
|
Attributable to equity holders of the Parent Company |
||||||||
|
|
Notes |
Ordinary share capital |
Share premium |
Share-based compensation reserve |
Treasury shares |
Foreign currency translation reserve |
Accumulated losses |
Total |
Non controlling interest |
Total equity |
|
|
|
US$ '000 |
US$ '000 |
US$ '000 |
US$ '000 |
US$ '000 |
US$ '000 |
US$ '000 |
US$ '000 |
US$ '000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at 31 December 2008 |
|
5,023 |
191,406 |
26,429 |
(4) |
(42,900) |
(92,490) |
87,464 |
- |
87,464 |
|
Total comprehensive income for the period ended 30 June 2009 |
|
|
|
|
|
|
|
|
|
|
|
Loss for the period |
|
- |
- |
- |
- |
- |
(14,554) |
(14,554) |
- |
(14,554) |
|
Other comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
Foreign currency adjustments |
|
- |
- |
- |
- |
12,610 |
- |
12,610 |
- |
12,610 |
|
Transactions with owners, recorded directly in equity |
|
|
|
|
|
|
|
|
|
|
|
Employee Share Option Scheme: |
|
|
|
|
|
|
|
|
|
|
|
Transfer of forfeited share options |
|
- |
- |
(185) |
- |
- |
185 |
- |
- |
- |
|
Share-based payments: Employees' and Directors' shares |
|
- |
- |
400 |
2 |
- |
- |
402 |
- |
402 |
|
Balance at 30 June 2009 |
|
5,023 |
191,406 |
26,644 |
(2) |
(30,290) |
(106,859) |
85,922 |
- |
85,922 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at 31 December 2009 |
|
5,023 |
191,406 |
27,482 |
(2) |
(28,400) |
(138,825) |
56,684 |
- |
56,684 |
|
Total comprehensive income for the period ended 30 June 2010 |
|
|
|
|
|
|
|
|
|
|
|
Loss for the period |
|
- |
- |
- |
- |
- |
(17,349) |
(17,349) |
- |
(17,349) |
|
Other comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
Foreign currency adjustments |
|
- |
- |
- |
- |
(3,245) |
- |
(3,245) |
- |
(3,245) |
|
Transactions with owners, recorded directly in equity |
|
|
|
|
|
|
|
|
|
|
|
Issue of Shares: |
|
|
|
|
|
|
|
|
|
|
|
Capital raising |
10 |
401 |
5,611 |
- |
- |
- |
- |
6,012 |
|
6,012 |
|
Employee Share Option Scheme: |
|
|
|
|
|
|
|
|
|
|
|
Share-based payments: Employees' and Directors' shares |
17 |
- |
- |
814 |
(4) |
- |
- |
810 |
- |
810 |
|
Balance at 30 June 2010 |
|
5,424 |
197,017 |
28,296 |
(6) |
(31,645) |
(156,174) |
42,912 |
- |
42,912 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Condensed Group Cash Flow Statement for the six months ended 30 June 2010 |
||||
|
|
|
30 June |
31 December |
30 June |
|
|
|
2010 |
2009 |
2009 |
|
|
|
US$ '000 |
US$ '000 |
US$ '000 |
|
|
|
(Unaudited) |
(Audited) |
(Unaudited) |
|
|
|
|
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES |
Notes |
|
|
|
|
Loss before tax |
|
(16,732) |
(45,789) |
(14,155) |
|
Adjusted for : |
|
|
|
|
|
Depreciation and amortisation |
|
1,445 |
2,479 |
911 |
|
Employment benefit expenditure (share-based payments) |
|
265 |
1,053 |
638 |
|
Loss/(profit) on disposal and scrapping of assets |
|
(98) |
501 |
217 |
|
Inventory write down |
|
420 |
1,947 |
- |
|
Impairment of assets |
|
2,202 |
4,476 |
- |
|
Net gain on foreign exchange |
|
(367) |
(7,596) |
(6,085) |
|
Increase/(decrease) in operating lease liability |
|
(48) |
9 |
3 |
|
Sundry income |
|
(6) |
(2) |
- |
|
Interest received |
|
(772) |
(3,996) |
(2,458) |
|
Finance costs |
|
500 |
1,108 |
329 |
|
Changes in working capital |
|
|
|
|
|
(Increase)/decrease in prepayments and other receivables |
|
(826) |
60 |
2,266 |
|
Increase in inventory |
|
(2,185) |
(842) |
(2,813) |
|
Increase/(decrease) in trade and other payables |
|
535 |
3,862 |
1,303 |
|
Increase in provisions |
|
1,963 |
13 |
485 |
|
Cash flows used in operations |
|
(13,704) |
(42,717) |
(19,359) |
|
Interest received |
|
283 |
2,899 |
2,458 |
|
Finance costs |
|
(12) |
(83) |
(329) |
|
Sundry income |
|
6 |
2 |
- |
|
Net cash used in operating activities |
|
(13,427) |
(39,899) |
(17,230) |
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
|
|
|
Purchases of property, plant and equipment |
5 |
(8,263) |
(26,915) |
(18,193) |
|
Proceeds from disposal of property, plant and equipment |
|
445 |
104 |
- |
|
Purchases of intangible assets |
7 |
- |
(1,185) |
- |
|
Purchases of subsidiaries |
|
- |
- |
(917) |
|
Net cash used in investing activities |
|
(7,818) |
(27,996) |
(19,110) |
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
|
|
|
Repayments of borrowings |
|
(13) |
(36) |
(15) |
|
(Increase)/decrease in security deposits and guarantees |
|
490 |
(221) |
516 |
|
Proceeds from issuance of shares |
10 |
5,985 |
- |
- |
|
Net cash (used in)/from financing activities |
|
6,462 |
(257) |
501 |
|
|
|
|
|
|
|
Net decrease in cash and cash equivalents |
|
(14,783) |
(68,152) |
(35,839) |
|
Cash and cash equivalents at beginning of period |
|
15,899 |
69,601 |
69,601 |
|
Effects of exchange rate movement on cash balances |
|
2,829 |
14,450 |
12,687 |
|
Cash and cash equivalents at end of period |
|
3,945 |
15,899 |
46,449 |
|
|
Notes to the Condensed Interim Group Financial Statements |
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
1. Basis of preparation |
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
These condensed consolidated interim financial statements for the six months ended 30 June 2010 have been prepared in accordance with the accounting policies set out in the 2009 Annual Report (except as stated below) which comply with International Financial Reporting Standards ("IFRS"), as adopted by the European Union ("EU") in accordance with EU laws (IA's regulation EC 1606/2002), and also in accordance with IAS 34, 'Interim Financial Reporting' as adopted by the EU. The interim results for the six months ended 30 June 2010 are unaudited. 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 as at and for the year ended 31 December 2009, which have been prepared in accordance with IFRS as adopted by the EU. The financial information set out in this document in respect of the year ended 31 December 2009 does not constitute the Group's statutory accounts for the year ended 31 December 2009. |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
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|
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|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
2. Accounting policies |
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
Except as described below, the accounting policies applied by the Group in these condensed consolidated interim financial statements are the same as those applied by the Group in its consolidated financial statements as at and for the year ended 31 December 2009, as described in those consolidated financial statements. |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
Taxes on income in the interim periods are accrued using the tax rate that would be applicable to expected total annual earnings. |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
The following new standards and amendments to standards are mandatory for the first time for the financial year beginning 1 January 2010. |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
IFRS 5, 'Non-current Assets Held for Sale and Discontinued Operations'. The amendment clarifies that the disclosure requirements in Standards other than IFRS 5 do not generally apply to non-current assets classified as held for sale and discontinued operations. |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
IFRS 8, 'Operating Segments'. The improvement to IFRS 8 clarifies that segment information with respect to total assets is required only if such information is regularly reported to the chief operating decision maker. |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
IAS 7, 'Statement of Cash Flows'. The amendment clarifies that only expenditures that result in the recognition of an asset can be classified as a cash flow from investing activities. |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
IAS 32, 'Financial Instruments: Presentation'. The amendment deals with the classification of rights issues. For rights issues offered for a fixed amount of foreign currency current practice appears to require such issues to be accounted for as derivative liabilities. The amendment states that if such rights are issued pro rata to an entity's all existing shareholders in the same class for a fixed amount of currency, they should be classified as equity regardless of the currency in which the exercise price is denominated. |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
The following new standards and amendments to standards and interpretations have been issued, but are not effective for the financial year beginning 1 January 2010 and have not been early adopted: |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
IFRS 7, 'Financial Instruments: Disclosures' |
||||||||||||||||||||||||||
|
|
IFRS 9, 'Financial Instruments' |
||||||||||||||||||||||||||
|
|
IAS 1, 'Presentation of Financial Statements' |
||||||||||||||||||||||||||
|
|
IAS 24, 'Related Party Disclosures' |
||||||||||||||||||||||||||
|
|
IAS 27, 'Consolidated and Separate Financial Statements' |
||||||||||||||||||||||||||
|
|
IAS 34, 'Interim Financial Reporting' |
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
3. Estimates |
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
During the six months ended 30 June 2010 management reassessed its estimates in respect of: |
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
- the carrying value of property, plant and equipment |
||||||||||||||||||||||||||
|
|
- the units of production depreciation |
||||||||||||||||||||||||||
|
|
- the impairment of assets |
||||||||||||||||||||||||||
|
|
- net realisable value of non-current assets held for sale |
||||||||||||||||||||||||||
|
|
- the recoverable amount of inventory (see note 9) |
||||||||||||||||||||||||||
|
|
- provisions (see note 11) |
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
4. Financial risk management |
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
The Group's financial risk management objectives and policies are consistent with those disclosed in the consolidated annual financial statements as at and for the year ended 31 December 2009. |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
Foreign currency rates |
||||||||||||||||||||||||||
|
|
The US Dollar rates of exchange applicable to the year are as follows: |
||||||||||||||||||||||||||
|
|
|
|
|
2010 |
2009 |
2009 |
|||||||||||||||||||||
|
|
|
|
|
Six months to 30 June |
Year ended 31 December |
Six months to 30 June |
|||||||||||||||||||||
|
|
|
|
|
Closing Average |
Closing Average |
Closing Average |
|||||||||||||||||||||
|
|
|
|
|
|
|
|
|||||||||||||||||||||
|
|
South African Rand |
|
|
0.13 0.13 |
0.13 0.12 |
0.13 0.11 |
|||||||||||||||||||||
|
|
British Pound |
|
|
1.51 1.53 |
1.59 1.57 |
1.65 1.49 |
|||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
5. Property, plant and equipment |
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
During the six months ended 30 June 2010 the Group spent US$215,820 (six months ended 30 June 2009: US$0) to upgrade processing plants and US$7,151,601 (six months ended 30 June 2009: US$0) was spent on mine development. US$895,255 was spent on other items of property, plant and equipment. |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
A Gekko 50 ton per hour processing plant was transferred to non-current assets classified as held for sale at 30 June 2010. Refer to note 6 for further details. |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
6. Non-current assets held for sale |
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
At 31 December 2009, the Group classified land situated at holding 59, Tedderfield Agricultural Holdings (net realisable value: US$442,125) and the Gekko 20 ton per hour gold processing plant and head gears (net realisable value: US$2,245,450) as non-current assets held for sale. During the period, the Group disposed of the land for US$445,137, resulting in a loss of US$9,881. |
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
An item of plant and machinery, a Gekko 50 ton per hour processing plant, has been classified as held for sale during the six months ended 30 June 2010. The value of the asset is now expected to be realised from the sale of the asset rather than the continuing use. The value of assets transferred to non-current assets held for sale is US$8,868,702 at 30 June 2010. Based on management's estimate of the fair value to be obtained from the sale, the asset held for sale has been impaired by US$2,203,702 to its fair value less costs to sell. |
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7. Intangible assets |
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|
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|
|
During the prior year, the Group purchased the issued share capital of Ferreira Estate and Investment Company ("FEIC"), the registered holder of the Prospecting and Mining rights over the Consolidated Main Reef, Crown Mines, City Deep and Langlaagte mining areas. The amount of US$1,282,417 included the purchase of these Prospecting and Mining rights. No further additions were made in the current year. |
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8. Loans receivable |
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|
Puno Gold Investments (Proprietary) Limited ("Puno") |
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|
Since the last report for the year ended 31 December 2009 there has been no resolution to the dispute relating to alleged procedural breaches of the Shareholders' Agreement between CRGSA and its current Black Economic Empowerment ("BEE") shareholder, Puno. The dispute surrounds the allocation of intercompany loans which fund the budget and work programme and the incurring of, and level of, certain costs. In order to suspend protracted litigation, the parties have agreed to refer the matter to arbitration pursuant to the dispute resolution mechanism under the Shareholders' Agreement. The Group still believes that ultimately their position will prevail. The Directors are still of the opinion that this will not have any material consequences in respect of the consolidated accounts of the Group. Notwithstanding this position, the Group have, pending the outcome of any dispute, allocated 100% of the intercompany balances directly from the Company to CRGSA. This additional 26% of intercompany debt, excluding interest, amounts to US$2,982,708 (ZAR22,375,901) between 1 January and 30 June 2010 (US$18,315,012 (ZAR151,903,560) between 1 January and 31 December 2009). |
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The loan payable to Puno contains the same allocations referred to above. |
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Group |
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|
|
|
|
June |
|
December |
|
|||||||||||||||||
|
|
|
|
|
|
|
|
2010 |
|
2009 |
|
|||||||||||||||||
|
|
|
|
|
|
|
|
US$ '000 |
|
US$ '000 |
|
|||||||||||||||||
|
9. Inventory |
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
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|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Exploration consumables |
|
|
|
|
|
|
1,045 |
|
1,223 |
|
|||||||||||||||||
|
Ore stockpiles |
|
|
|
|
|
|
158 |
|
308 |
|
|||||||||||||||||
|
Stationery on hand |
|
|
|
|
|
|
2 |
|
43 |
|
|||||||||||||||||
|
Total inventory |
|
|
|
|
|
|
1,205 |
|
1,574 |
|
|||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
The amount of the write-down of ore stockpiles to net realisable value and recognised as an expense is US$419,995 (2009: US$1,946,955). |
|
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
10. Share capital and share premium |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
On 22 January 2010, CRG placed a total of 24,691,960 new ordinary shares of £0.01 each in the capital of the Company at a price of £0.15 per share to raise US$6.0 million (£3.7 million). 23,781,964 Placing Shares were placed using the cashbox structure with existing investors and 909,996 Placing Shares were placed with Directors and senior management of the Company. As part of this placing, 2,567,964 ordinary shares were placed with entities owned and controlled by Mark Creasy who is deemed to be a Related Party under the UKLA's Listing Rules by virtue of the fact that he is a Substantial Shareholder. The placing of ordinary shares is classified as a smaller related party transaction under Listing Rule 11.1.10 and this disclosure is being made in accordance with that rule. |
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|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
11. Environmental rehabilitation and other provisions |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
Provisions consist of provisions for environmental rehabilitation of US$3,660,430 (30 June 2009: US$697,888) and a provision of US$605,090 (30 June 2009: US$547,562) which has been recognised for restructuring. The restructuring costs are expected to be incurred during the current financial year. |
|
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
12. Directors' emoluments |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
During the current year, the composition of the Board of Directors changed. Two Directors of the Group, Mr A. Walton and Mr R. Kirkby, resigned on 14 April 2010. Mr P. Malaza and Mr J. Brauns were appointed to the Board on the 17 February 2010. |
|
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
13. Exploration expenditure |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
Included in exploration expenditure above is the revenue incidental to the exploration and development operations of the Group. CRGSA sold 3,085 ounces (30 June 2009: 122.81 ounces) of gold recovered from the metallurgical processing plants during the six months ended 30 June 2010. The revenue attributable to this sale is US$3,830,252 (30 June 2009: US$115,345). |
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||||||||||||||||||||||||||
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|
||||||||||||||||||||||||||
|
14. Income taxes |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
Income tax expense is recognised based on management's best estimate of the weighted average annual income tax rate expected for the full financial year. The estimated average annual tax rate used for the year to 30 June 2010 is 3.69% (2009: 1.19%). The increase is mainly due to an increase in the intercompany loans from the Company to Central Rand Gold (Netherlands Antilles) N.V. ("CRGNV") and the disallowed interest on these loans. |
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|
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||||||||||||||||||||||||||
|
15. Commitments |
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||||||||||||||||||||||||||
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|
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
Group |
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|||||||||||||||||||
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|
|
|
|
|
|
|
June |
|
December |
|
|||||||||||||||||
|
|
|
|
|
|
|
|
2010 |
|
2009 |
|
|||||||||||||||||
|
|
|
|
|
|
|
|
US$ '000 |
|
US$ '000 |
|
|||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
|
Design of optical ore sorter |
|
26 |
|
- |
|
||||||||||||||||||||||
|
Mining equipment |
|
1,176 |
|
- |
|
||||||||||||||||||||||
|
Fees payable to iProp Limited for prospecting |
|
- |
|
500 |
|
||||||||||||||||||||||
|
|
|
|
|
|
|
|
1,202 |
|
500 |
|
|||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
16. Segment reporting |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
An operating segment is a component of an entity that engages in business activities from which it may earn revenues and incur expenses, whose operating results are regularly reviewed by the entity's chief operating decision maker to make decisions about resources to be allocated to the segment and assess its performance and for which discrete financial information is available. The entity's chief operating decision maker reviews information in one operating segment, being the acquisition of mineral rights and data gathering in the Central Rand Goldfield of South Africa, therefore management has determined that there is only one reportable segment. Accordingly, no analysis of segment revenue, results or net assets has been presented. No corporate or other assets are excluded from this segment. |
|
||||||||||||||||||||||||||
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|
|
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
17. Share based payments |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
Grant of shares in the Company |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
During the six months ended 30 June 2010, the Company granted the following shares to selected Non-Executive Directors: |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
Vesting |
Strike price |
Allocation |
|
Number of shares granted |
|
||||||||||||||||||||||
|
100,000 on 28 June 2010 100,000 on 17 February 2011 100,000 on 17 February 2012 |
Exercise price of £0.01 per share. |
Mr J. Brauns |
|
300,000 |
|
||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
No further shares were issued from the Employee Share Trust. |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
Grant of options in the Company |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
During the period further share options were granted to selected Executive Directors. The options granted are summarised below. |
|
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
Vesting |
Strike price |
Allocation |
|
Number of share options granted |
|
||||||||||||||||||||||
|
500,000 on 10 February 2011, 500,000 on 10 February 2012 and 500,000 on 10 February 2013. |
Exercise price escalates in accordance with the vesting tranches. One third at price of £0.20, one third at £0.40 and one third at £0.60. |
Mr S.J. du Toit |
|
1,500,000 |
|
||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
18. Related parties |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
Two dormant subsidiaries in the Group, Central Rand Gold Assay Laboratory (Proprietary) Limited and Central Rand Gold Water (Proprietary) Limited, were deregistered during the six months ended 30 June 2010. The deregistration has no material impact on the Group. Except for the information disclosed in Note 17 Share-based payments above, no other disclosable related party transactions occurred in the period. |
|
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
19. Events occurring after balance sheet date |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
On 5 July 2010 CRG placed a total of 1,328,071,380 new ordinary shares (Firm Placing of 649,042,355 new shares and Placing and Open Offer of 679,029,025 new shares) of £0.01 each in the capital of the Company at a price of £0.02 per share to raise gross proceeds of US$40.4 million (£26.6 million). The placing provides sufficient funds to meet the projected funding requirements of the business for at least the next twelve months from the date of approval of the interim financial statements. |
|
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
20. Contingent liability |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
Damages claim |
|
||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
Puno has issued a summons on the Company, claiming damages, to the value of US$17m. This action instituted by Puno against the Company out of the South Gauteng High Court, Johannesburg, traverses issues similar to those covered by Puno's previous application. In particular, Puno's damages claim is premised on a similar interpretation of the Shareholders' Agreement as it contended for in the previous application. |
|
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
The previous application was dismissed by Acting Judge, Alan Horwitz SC, on Thursday, 5 November 2009, with costs, including the costs of two counsel on the grounds that Puno had failed to make out a case for the relief sought on each and every ground which formed the subject of the application hearing. Puno's application for leave to appeal against the judgment was also dismissed with a similar order as to costs. In relation to Puno's interpretation of the Shareholders' Agreement, the Acting Judge expressly rejected the very interpretation on which the present action seeks to rely. |
|
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
It is the Company's considered view that the present action is thus equally ill-founded and possibly vexatious, and while Puno has in any event failed to take proper and appropriate steps in the institution of these proceedings, on which basis alone the present action must be stayed, Puno's contentions for the relief sought are considered to be flawed and devoid of merit. |
|
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
In consequence the directors are of the opinion that in as much as the action has no prospects of success this will not have any material consequences in respect of the consolidated accounts of the Group. |
|
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
|
|
|
||||||||||||||||||||||||||
|
|
|||||||||||||||||||||||||||
Related Shares:
Central Rand Gold