23rd Dec 2005 07:00
Aurum Mining PLC23 December 2005 For immediate release 23 December 2005 AURUM MINING PLC ("Aurum" or "the Company") Interim results for the six month period ended 30 September 2005 Aurum Mining plc (AIM: AUR), the company formed in 2004 to acquire gold andother mineral extraction projects in the Former Soviet Union (FSU) and whichsubsequently acquired an exploration licence over a gold and copper project inthe Kyrgyz Republic, is pleased to announce its interim results for the sixmonths ended 30 September 2005. Highlights: • Good progress has been made with the Andash gold and copper project in the Kyrgyz Republic with the programme of re-opening, cleaning and extending trenches in Zones 1 and 2 completed. • A new exploration opportunity, Tokhonysay, identified and trenched. A total of 1324m of trenching was undertaken at Andash with 536 samples sent for assay. • Programme of work initiated including geotechnical drilling and survey to support the pit optimisation work and tailings pond design. This will allow the Company to apply for land permits and support the Mining Licence application, which is expected in the New Year. • The State Commission of Resources of the Kyrgyz Republic has included 21.7 million tonnes of C1 and C2 reserves at Andash into the State Register, amounting to total gold and gold equivalent of more than 1.5 million ozs. • Mark Jones, an executive with considerable international management experience, joined the Board of Directors as Chief Executive Officer on 1 July 2005. Dr Colin Knight, a highly experienced mining professional, was also appointed to the Board as a Non-Executive Director on 6 September 2005. • To ensure the timely development of the Andash asset, and to put the Company into a position to exploit other opportunities, a further issue of shares is planned. Sean Finlay, the Chairman of Aurum Mining, commenting on the outlook for Aurumsaid: "The last six months have been a very busy period for the Companyincluding the completion of the re-opening, cleaning and extending of trenchesin Zones 1 and 2, which means the Andash project continues to unfold in a verypositive manner and we look forward to moving ahead. Plenty of new opportunitiespresent themselves to the Company and with Mark Jones on board, who is a majorasset to the management and the direction of the Company, Aurum is well placedto capitalise on the current favourable base and precious metal priceenvironment and to locate and assess new opportunities." For further information: Aurum Mining plc Tel: 020 7478 9050Sean Finlay, ChairmanMark Jones, Chief Executive W H Ireland Tel: 0121 616 2101Tim Cofman Buchanan Communications Tel: 020 7466 5000Mark CourtJames Strong Notes to editors Aurum joined the AIM market of the London Stock Exchange in May 2004 with thestrategy of seeking, evaluating and acquiring gold and other mineral extractionprojects in the Former Soviet Union (FSU). In January 2005 the Company completedits first acquisition, giving the Company an exploration licence over a gold andcopper project in the Kyrgyz Republic. In its State Register, the StateCommission of Resources of the Kyrgyz Republic has included 21.7 million tonnesof C1 and C2 reserves from the project, amounting to gold and gold equivalent ofmore than 1.5 million ozs. CHAIRMAN'S STATEMENT Introduction Aurum Mining Plc, the company formed to acquire gold and other mineralextraction projects in the Former Soviet Union, is pleased to announce itsresults reflecting the six month period ended 30 September 2005. Results for the Period The Company made an operating loss for the period of £397,000 compared with aloss of £116,000 in the six month period ended 30 September 2004. Review of Activities The Company has continued to make good progress with its Andash gold and copperproject in the Kyrgyz Republic ("the Project"). A programme of re-opening, cleaning and extending trenches in Zones 1 and 2 wascompleted and in addition a new exploration opportunity, Tokhonysay, within theAndash exploration licence area was identified and trenched. A total of 1324m oftrenching was undertaken with 536 samples sent for assay. Trenching at an outcrop location 250m east of Zone 1 intersected 13m ofmineralisation containing gold at 1.2 g/t and copper at 0.5%. The area betweenZone 1 and this outcrop location is covered by overburden. This is a possibleindication of a significant extension to Zone 1. Further surface work anddrilling will be initiated to confirm this. Trenching close to Zone 2 intersected 4m of mineralisation containing gold at13.3 g/t, highlighting the potential of the Andash licence area. Thismineralisation indicates an extension of the outcrop zone. Trenching at a new exploration opportunity, Tokhonysay, intersected 33m ofmineralisation at an average grade of 1.4 g/t gold and 1.6% copper. This newarea is located 2.4km north-east of Zone 1. A programme of work has been initiated that includes geotechnical drilling andsurvey so that we have data to support our pit optimisation work and tailingspond design. This will allow us to apply for land permits and support our MiningLicence application which we expect to obtain in the New Year. Currently theProject has a temporary mining licence which is valid until the end of May 2006. On 24 August 2005, the Company announced that the State Commission of Resourcesof the Kyrgyz Republic have included 21.7 million tonnes of C1 and C2 reservesof the Andash Mining Company, Aurum's Kyrgyz subsidiary, into its StateRegister. The reserves contain total gold and gold equivalent of more than 1.5million ozs. On 29 September 2005 the Company announced that it had entered into aconditional agreement with Loyal Wealthy Limited ("Seller") to purchase 51 percent of the issued share capital in Open Joint Stock Company Geocentr ("Geocentr"), a Russian company that owns an exploration licence in the Russian Far East.On 13 December the Company announced that the acquisition of Geocentr had notcompleted within the conditional agreement's terms and would not thereforeproceed. As part of the conditional agreement entered into with the Seller, it was agreedthat if the acquisition did not complete then the benefit of an outstanding loanof $170,000 to Geocentr would be assigned to the Seller. As the acquisition wasnot completed, this loan was reassigned. While Geocentr represented aninteresting exploration opportunity and the Board is disappointed that theacquisition could not proceed it is critical that we select only projects thatmeet our stringent criteria. Board Changes Mark Jones joined the Board of Directors as Chief Executive Officer on 1 July2005 and at the same time John Webster, who was previously the Company'sManaging Director, became a Non-Executive Director of the Company. Mr Jones, who holds an MBA from Newport University and an associate degree fromColumbia University, New York, is a Mining Graduate from the Camborne School ofMines, UK. For the five years prior to joining the Company Mr Jones worked forIngersoll-Rand Company Ltd (NYSE: IR), a leading diversified industrial firm,most recently as Business Unit Manager, Global Services, Ingersoll-Rand Europe. Mr Webster continues to provide technical input to Aurum in the areas of projectevaluation and development, including implementation of the drilling servicesagreement between Aurum and PPI. Dr Colin Knight, a highly experienced mining professional, was appointed on 6September 2005 as Non-Executive Director. His international mining experiencehas been gained through almost five decades in the industry and spans academia,executive industry roles and consultancy. His experience of project evaluationin the FSU is of particular value to the Company. Outlook The last six months have been a very busy period for the Company including thecompletion of the re-opening, cleaning and extending of trenches in Zones 1 and2, as well as the initiation of geotechnical drilling and surveying. Plenty ofnew opportunities present themselves to the Company including the newexploration opportunity in Tokhonysay. We look forward to the coming months withgreat enthusiasm as we grow the Company. Sean Finlay Chairman 23 December 2005 Consolidated Profit and Loss Account For the six months ended 30 September 2005 (unaudited) Notes 6 months ended 6 months ended 12 months to 30 September 30 September 31 March 2005 2005 (unaudited) 2004 (unaudited) (audited) £000 £000 £000 Turnover - - -Cost of Sales - - -Gross profit - - -Administrative expenses (397) (116) (389)Operating profit / (loss) (397) (116) (389)Net interest receivable 8 18 45Profit/ (loss) on ordinary activities before (389) (98) (344)taxationTaxation 3 - - -Profit / (loss) on ordinary activities after (389) (98) (344)taxationLoss per share 4 (4.09)p (1.19)p (4.23p) All recognised gains and losses are included in the profit and loss account. Consolidated Balance Sheet At 30 September 2005 (unaudited) 6 months ended 6 months ended 12 months to 30 September 30 September 31 March 2005 2005 (unaudited) 2004 (unaudited) (audited) £000 £000 £000Fixed assetsIntangible assets 986 - 819Tangible assets 277 11 189 Total fixed assets 1,263 11 1,008 Current assets /(liabilities)Stocks 9 - -Debtors 289 18 265Cash at bank and in hand 127 1377 944Creditors: amounts falling due within one year (141) (34) (281)Total assets less current liabilities 1,547 1372 1,936Creditors: amounts falling due after more than one year - - - Net assets 1,547 1372 1,936 Capital and reservesCalled up share capital 95 82 95Share premium 1,687 1,388 1,687Capital reserve 498 498Profit and loss account (733) (98) (344) Shareholders' funds 1,547 1372 1,936 Consolidated cash flow statement For the six months ended 30 September 2005 (unaudited) 6 months ended 6 months ended 12 months to 30 September 30 September 31 March 2005 2005 (unaudited) 2004 (unaudited) (audited) £000 £000 £000 Net cash outflow from operating activities (562) (99) (487) Returns on investments and servicing of financeInterest received 8 18 45 Net cash flow from returns on investments and servicing 8 18 45of finance Taxation - Capital expenditurePurchase of intangible fixed assets (167) (56)Purchase of tangible fixed assets (96) (12) (179) Net cash outflow from capital expenditure (263) (12) (235) Acquisitions and disposalsPurchase of subsidiary undertaking (160)Cash acquired with subsidiary 5 Net cash outflow from acquisitions (155) FinancingIssue of ordinary shares 1,550 2,150Expenses paid in connection with share issues - (80) (374) Net cash inflow from financing 1,470 1,776 Increase/(decrease) in cash (817) 1377 944 Notes to the Interim Results 1 BASIS OF PREPARATION The interim accounts for the six months ended 30 September 2005 are unauditedand do not constitute statutory accounts in accordance with section 240 of theCompanies Act 1985. The financial information has been prepared in accordance with applicableaccounting standards and under the historical cost accounting convention. Accounting policies consistent with those applied in the financial statementsfor the year ended 31 March 2005 have been used in preparing the unauditedinterim financial statements for the 6 months ended 30 September 2005. 2 DIVIDENDS The Directors are not declaring a dividend for the six months ended 30 September2005. 3 TAXATION The charge for taxation is based on the profit for the year as adjusted fordisallowable items. 4 LOSS PER SHARE The calculation of the loss per share is based on the loss for the period of£389,000 and the weighted average number of shares in issue during the period of9,505,775. 5 COPIES OF INTERIM RESULTS Copies of the interim results will be sent to shareholders and will be availablefrom the Company's registered office, 26 Curzon Street, London W1J 7TQ This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Shearwater