27th Sep 2007 18:24
Condor Resources PLC27 September 2007 CONDOR RESOURCES PLC DIRECTOR'S STATEMENT FOR THE SIX MONTHS TO 30 JUNE 2007. HIGHLIGHTS • The consolidated, unaudited net loss after taxation of the Group in respect of the six months ended 30th June 2007 amounted to £691,399. • Exploration Progress: Drill tested several prospects within El Salvador; completed initial and infill trenching at most prospects; mobilised drilling rig to Nicaragua. • San Albino Project, Nicaragua: Defined a significant, regionally mineralised trend (Guyape Suture Zone) through rock chip sampling supporting a combined strike length of over 5,500 metres within the San Albino licence. • San Albino Project, Nicaragua: Announced the discovery of the Arras Prospect, within a high grade gold mineralised shear zone, including 18 metres width at 6.77g/t gold and 11.84g/t silver and 16 metres at 7.89g/t gold and 10.23g/t silver. • La Calera, El Salvador: Reported significant trench results of up to 14 metres width and at grades of up to 4.87g/t gold. • El Cacao, Nicaragua: Announced significant intercepts from the initial phase of trenching showing excellent width and grade over at least a 400 metre strike length up to 3.1m wide and at grades of up to 2.58g/t gold. • Appointment of Mirabaud Securities Limited as broker to the Company commencing on the 1st February 2007 POST PERIOD HIGHLIGHTS • El Cacao Prospect, Nicaragua: Completed a 9 drill hole, 964 metre reverse circulation and diamond drilling program. • San Albino Project, Nicaragua: Commenced an initial 1,000 metres reverse circulation and diamond drilling program on the Arras and San Albino Mine prospects. • La Calera, El Salvador: Completed a 4,000 metres infill trenching program on the main mineralised zones The full financial statements for the period follow. Enquiries: Condor Resources Plc Mark Child, Chairman +44 20 7408 1067 Nigel Ferguson, CEO +44 20 7808 7222 Nabarro Wells & Co. Limited Hugh Oram +44 20 7710 7400 Anthony Rowland +44 20 7710 7419 Mirabaud Securities Limited Rory Scott +44 20 7878 3360 Parkgreen Communications Limited Simon Robinson Erica Nelson +44 20 7851 7480 CONDOR RESOURCES PLC CHIEF EXECUTIVE'S REVIEW OF OPERATIONS FOR THE SIX MONTHS TO 30 JUNE 2007. Introduction In the 6 month period ending 30 June 2007, Condor has again advanced itsprojects through diligent exploration on most project areas, but been frustratedin El Salvador with not being able to drill its' primary project, La Calera, dueto the non issue of environmental permits by the Ministry of the Environment. The Company's global JORC compliant resources remain at an Inferred Resource ofsome 467,000 ounces of gold and 18.4 million ounces of silver. Additional delaysof up to 8 weeks due to bottlenecks in the reporting of assay results by thecommercial laboratory in the USA, has also caused frustration for the company inthe timely release of results to the market. The Company incurred a net operating loss of £691,399 for the 6 month period, ofwhich £367,487 relates to the write off of exploration expenses relating to theEl Potosi Project. A decision was made by the Directors to return the El PotosiLicence to Brett Resources during the period covered by these accounts, whichhave been expensed in conformity with IFRS requirements. Significant changes have taken place during the period with regard to theCompany's projects. In El Salvador access problems have retarded progress on thedrill testing of potential mineral resources at the La Calera, Carolina andGigante Projects, whilst in Nicaragua good progress has been made with excellentresults from trenching and drilling at the San Albino and Cacao Projects. Thisshift in focus of exploration efforts from El Salvador to Nicaragua highlightsthe benefit of the dual country strategy implemented by the Company. The Directors remain confident that the company's corporate goals of drilldefining between 1 to 2 million ounces of gold by May 2008 can still beachieved. To assist in achieving this corporate target, manpower is beingredirected from El Salvador to Nicaragua, to the areas providing significantencouragement at the San Albino and Cacao Projects. Additionally the Company isinvestigating alternative commercial laboratories of a similar standard and costeffectiveness to those being utilised now, to provide timely receipt of resultsand the calculation of mineral resources. Operationally, the Company advanced its knowledge of its projects by securing adrilling rig and commenced reverse circulation and diamond core drilling at theEl Pescadito Project, El Salvador. It also reported significant trench resultsat La Calera, El Salvador, including mineralised structures of up to 14 metreswidth and at grades of 4.87g/t gold, including several, greater than 1 metrewide, higher grade zones of greater than 10g/t gold. In Nicaragua, significant intercepts were reported from the first batch of assayresults for the initial phase of 34 trenches for 1,432 metres on its' El CacaoProspect located in the historical El Limon - La India mining district,Nicaragua. These show excellent width and grade and establish a continuity ofmineralization over at least a 400 metre strike length. Mineralised veins up to3.1m width at grades of 2.58g/t gold are reported, including a one metre wide,higher grade zone of greater than 10g/t gold. Infill trenching at 40 metresspacing has been completed with assay results expected very soon. Condor's success continued with the announcement of the discovery of wide, highgrade gold mineralization within a broad shear zone at its' San Albino Prospectin northern Nicaragua defining a mineralised corridor of at least 200 metreslength and varying between 3 metres width in the north-east to over 18 metreswidth towards the south-west. Best results include 18 metres at 6.77g/t gold and11.84g/t silver; 3 metres at 20.11g/t gold and 31.07g/t silver; 16 metres at7.89g/t gold and 10.23g/t silver and 3 metres at 4.99g/t gold and 24.37g/tsilver. Operations El Salvador A delay in the granting of environmental permits by the Ministry of Environmentin El Salvador, has restricted all drilling activities to the PescaditoConcession, where a permit was awarded to Condor previously. The Company, alongwith all other exploration and mining companies in El Salvador, are lobbying theGovernment for issue of these permits to allow drilling and mining of theeconomic resources present. CONDOR RESOURCES PLC CHIEF EXECUTIVE'S REVIEW OF OPERATIONS FOR THE SIX MONTHS TO 30 JUNE 2007. The El Pescadito Project exploration programs included reconnaissance geologicalmapping and rock chip sampling followed by 1,788 metres of trenching in 44trenches and 1,675.43 metres of combined Reverse Circulation and Diamond drilltesting of anomalous results in 25 drill holes. Significant trenching results from the El Pescadito Project included 31 metresat 1.8g/t gold and 283g/t silver; 15 metres at 1g/t gold and 105g/t silver and 5metres at 2.78g/t gold and 326g/t silver at the Divisidero structure. Whilstsignificant drilling results included 2 metres at 1.44g/t gold and 63.5g/tsilver in PRRD005 and 10.78 metres at 1.35g/t gold and 369g/t silver in ACRD009.Further follow up work is required. These results have highlighted the potential for the Protectora, San FranciscoTortuga and Agua Caliente-Virginia Prospects to host significant gold and silvermineralization, with the Agua Caliente -Virginia Prospect having the highestpotential ranking. Follow-up trenching and drilling programs have been planned. At the El Gigante Prospect, located in the Pescadito Project, El Salvador themain target forms part of the historic El Gigante Mine, which is a north westtrending multiple vein system, mined until the early 1960s by undergroundoperations to a depth of approximately 75 metres and over a strike length of upto 500 metres. Work conducted by Condor during the period was restricted to datareview of historic underground plans and channel sampling of those undergroundworkings. Condor also complete limited reconnaissance geological mapping to dateand has embarked on a significant trenching program to test the significant goldmineralization intercepted in underground channel sampling and drillingcompleted historically. Exploration at the La Calera Project was designed to define the extent of themineralization hosted by the main northwest trending Rosa, Rosa West andCalichal vein systems. Initial exploration revealed the potential of extendingthe initial resource strike length of 600 metres to over 1,000 metres. Calerahas a JORC compliant Inferred Resource of 112,604 ounces of gold, 97,373 ouncesof silver. The exploration work conducted at La Calera consisted mainly of2,270.9 metres of trenching in 16 trenches as part of a 4,000 metre trenchingprogram. Significant results reported to date from this program include: 1 metre at18.04g/t gold and 6.8g/t silver; 3 metres at 4.74g/t gold and 2.23g/t silver; 11metres at 1.06g/t gold and 0.97g/t silver and 3 metres at 3.30g/t gold and 6.73g/t silver. The results of the trenching programs confirm the potential for theRosa, Rosa West and Calichal mineralised vein systems to extend its strikelength up to 1000m. Nicaragua In Nicaragua, excellent results have been returned from most project areas withsignificant gold intercepts returned in the San Albino Project. These include 12metres at 5.69g/t gold in trench SATR003; 18 metres at 6.77g/t gold and 8 metresat 8.82g/t gold in trench SATR010, and 12 metres at 5.59g/t gold in trenchSATR011. Further excellent results were also returned from trenching within theLas Conchitas Prospect, San Albino Project, including results of 2 metres at3.08g/t gold and 1metre at 6.75g/t gold. Regional rock chip samples of up to 21g/t gold were also returned from the San Albino Prospect area, supporting astrike length of over 4,000 metres for the north-west striking San Albino"Guyape Suture" trend and 1,500 metres for the nearby Las Conchitas trend. The Company is hopeful of further excellent results from the San Albino Projectwhere ongoing work is producing high grade gold anomalies requiring trenchingand drill testing. Of particular interest is the development of the Arras, SanAlbino Mine and Las Conchitas areas where significant, wide high gradestructures are being defined with average grades in excess of 5g/t gold andindividual strike lengths of greater than 200 metres. The Company's seniorgeologists believe that there is a distinct regional trend to thismineralization and the planned work will define further high grade zoneshopefully amenable to economic mining. CONDOR RESOURCES PLC CHIEF EXECUTIVE'S REVIEW OF OPERATIONS FOR THE SIX MONTHS TO 30 JUNE 2007. Mapping and rock chip sampling continues at the newly awarded Los Potrerilloslicence adjacent to the San Albino licence, with further assay results awaitedfrom sampling of several siliceous outcrops and float which form the maintargets for exploration. To date, encouragement is gained from the initiallimited program of sampling which returned indications of epithermalmineralization over broad areas within a distinct mineralised trend, interpretedby Condors geologists to be an extension of those trends defined at San Albino. Trenching at El Cacao also returned some promising intersections over a 400metre strike length, with a best result of 1metre at 11.54g/t gold in trenchCCTR004 and 3.1metres at 2.58g/t gold in trench CCTR006. Quartz mineralizationwas intercepted in all but one drill hole completed recently at the project andthese results are awaited with confidence of further gold mineralization beingpresent. Infill trenching on 40 metre spacing has been completed and results areawaited. Two rock chip samples from the Cacao vein returned results exceeding 1g/t goldfrom the main mineralised zone defined by the trenching, thus confirmingmineralization further east than previously defined. A third rock chip collectedover two kilometres west of the main zone also returned >0.5g/t gold. At Kuikuinita, Nicaragua, trench results from the Los Indios Prospect confirmprevious results with wide low grade results including 1m at 5.08g/t and 4m at1.31g/t gold. Further work is planned in a staged program to test thismineralised structure through trenching and then drilling. At the Columbus project, after delays caused by extended negotiations on accessagreements exploration finally was underway by the end of June 2007. So far 260metres of trenching had been completed and another 70 metres was in progress atthe Mina Columbus Prospect for a total of three hundred and sixty-five samplesbeing collected and submitted for analysis. The trenching programme at Columbuscontinues with assay results awaited. The Company also reviewed the Juan Sebastian Project with a view to itsretention. Subsequently the project was relinquished to the licence holders. CONDOR RESOURCES PLC CHIEF EXECUTIVE'S REVIEW OF OPERATIONS FOR THE SIX MONTHS TO 30 JUNE 2007. POST PERIOD HIGHLIGHTS El Cacao Prospect, Nicaragua The Company completed its initial reverse circulation and diamond drillingprogram on the El Cacao prospect to test depth extensions to the significantgold mineralization intercepted within trenching completed at surface. A totalof 994 metres were completed in 9 holes. San Albino Project, Nicaragua On 3 September 2007, the Company announced the results of extension and infilltrenching at the Aguja de Arras Prospect in Northern Nicaragua close to thehistorical high grade San Albino Gold Mine. Extensions to trenches excavated inthe first phase of trenching, as well as an infill trench designed to close thetrench spacing to 40 metres along strike, has extended the width and betterdefined the orientation of the high-grade gold mineralization reported in May2007. A mineralised zone up to 24 metres width at a grade of 7.17 gram per tonne gold(SATR003 - including a 3 metre wide zone of internal waste) has now beendefined, with individual assay results of up to 1 metre at 47.5 grams per tonnegold. This high grade gold mineralization has been intercepted in five adjacenttrenches and currently defines a strike length of 200 metres, open along strikein both directions, with the maximum width of 24 metres remaining unconstrained. High grade gold mineralization at the Arras Prospect is hosted by both quartzveins and the adjacent altered wall rock, in a package of graphitic schistwithin the under-explored Guayape Suture Zone. The Directors believe thatmultiple rock chip samples assaying over 1 gram per tonne gold indicate half adozen or more parallel mineralised systems throughout the company's San AlbinoLicence and extending onto the adjacent Los Potrerillos Licence. Condor'sapplication for the 12 km2 Potrerillos Licence was granted in July this year andfield rock chip sampling has already commenced. At the Arras Prospect, furtherextensions to the existing trenches and additional trenching along strike isalready underway and a combined diamond and reverse circulation drilling programhas commenced. Other gold mineralised trends identified by regional rock chip sampling withinthe San Albino Licence area are being systematically tested by trenching and theCompany is confident that this work will result in the discovery of further highgrade gold mineralised systems comparable to the Arras Prospect. El Potosi Project, El Salvador The Company recently completed a full technical review of all drilling andsurface data for the El Potosi Licence in El Salvador. The review suggests thatalthough gold is present in the system, the mineralised structures are narrowand very discrete with little or no wall-rock alteration, thus proving a veryhard and expensive target to define further. It was therefore decided thatCondor's other projects, such as Cacao, Arras, and San Albino, should be givenevery opportunity to be developed into profitable mines and the US$1.25 millionpayment due to Brett Resources under the Brett El Potosi Option Agreement (RNS15 February 2007) would be better spent funding exploration and development ofthose projects. Condor informed Brett that it would withdraw from the El PotosiOption Agreement. Given the decision to return El Potosi Licence to Brett Resources was made bythe Directors in the period covered by these accounts, the costs associated withthe El Potosi Licence (£367,487) have been expensed in conformity with IFRSrequirements. Nigel Ferguson Chief Executive Officer 26th September 2007. INDEPENDENT REVIEW REPORT TO CONDOR RESOURCES PLC Introduction We have been instructed by the Company to review the financial information forthe six months ended 30 June 2007, which comprises Consolidated IncomeStatement, Consolidated Statement of Changes in Equity, Consolidated BalanceSheet, Consolidated Cash Flow Statement, and related notes 1 to 4. We have readthe other information contained in the interim report and considered whether itcontains any apparent misstatements or material inconsistencies with thefinancial information. This report is made solely to the Company in accordance with guidance containedin Bulletin 1999/4 "Review of interim financial information" issued by theAuditing Practices Board. To the fullest extent permitted by law, we do notaccept or assume responsibility to anyone other than the Company, for our work,for this report, or for the conclusions we have formed. Directors' responsibilities The interim report, including the financial information contained therein, isthe responsibility of, and has been approved by the Directors. The Directors areresponsible for preparing the interim report in accordance with the AIM ListingRules which require that the accounting policies and presentation applied to theinterim figures should be consistent with those applied in preparing thepreceding annual accounts except where any changes, and the reasons for them,are disclosed. Review work performed We conducted our review in accordance with guidance contained in Bulletin 1999/4"Review of interim financial information" issued by the Auditing Practices Boardfor use in the United Kingdom. A review consists principally of making enquiriesof Group management and applying analytical procedures to the financialinformation and underlying financial data and based thereon, assessing whetherthe accounting policies and presentation have been consistently applied unlessotherwise disclosed. A review excludes audit procedures such as tests ofcontrols and verification of assets, liabilities and transactions. It issubstantially less in scope than an audit performed in accordance withInternational Standards of Auditing (UK and Ireland) and therefore provides alower level of assurance than an audit. Accordingly we do not express an auditopinion on the financial information. Review conclusion On the basis of our review we are not aware of any material modifications thatshould be made to the financial information as presented for the six monthsended 30 June 2007. Mazars LLPLondon 26th September 2007 CONDOR RESOURCES PLC CONSOLIDATED INCOME STATEMENT FOR THE SIX MONTHS TO 30 JUNE 2007 Six Months to Six Months to 30.06.07 30.06.06 £ £CONTINUING OPERATIONSOperating costs (394,140) -Administrative expenses (367,427) (201,457) ------- ------- OPERATING LOSS (761,567) (201,457)Finance income 70,168 29,009 ------- ------- (691,399) (172,448)LOSS BEFORE TAXTax - - ------- -------LOSS FOR THE PERIOD (691,399) (172,448) ======= =======Attributable to:Equity holders of the parent (691,399) (172,448) ======= ======= Earnings per share expressedin pence per share:Basic (0.53) (0.35)Diluted (0.49) (0.28) CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 30.06.07 31.12.06 30.06.06 £ £ £Losses (691,399) (518,076) (172,448)Exchange difference (3,353) - -Share capital 5,000 - 1,298,118Share premium 46,022 - 7,306,486Legal reserve - 60 -Share option reserve - 109,275 - ------- ------- ------- Net addition to reserves (643,730) (408,741) 8,432,156Opening reserves 8,023,415 8,432,156 - ------- ------- ------- Closing reserves 7,379,685 8,023,415 8,432,156 ======= ======= ======= CONDOR RESOURCES PLC CONSOLIDATED BALANCE SHEET AS AT 30 JUNE 2007 30.06.07 31.12.06 30.06.06 £ £ £ASSETSNON-CURRENT ASSETSProperty, plant and equipment 111,975 69,473 27,441Intangible assets 4,984,270 4,464,040 3,940,300Trade and other receivables 6,281 170,076 9,660 ------- ------- ------- 5,102,526 4,703,589 3,977,401 ------- ------- -------CURRENT ASSETSTrade and other receivables 74,096 40,818 596,226Cash and cash equivalents 2,319,142 3,456,183 4,326,693 ------- ------- ------- 2,393,238 3,497,001 4,922,919 ------- ------- ------- LIABILITIESCURRENT LIABILITIESTrade and other payables 116,079 176,934 468,164Tax payable - 241 - ------- ------- ------- 116,079 177,175 468,164 ------- ------- ------- NET CURRENT ASSETS 2,277,159 3,319,826 4,454,755 ------- ------- -------NET ASSETS 7,379,685 8,023,415 8,432,156 ======= ======= ======= SHAREHOLDERS' EQUITYCalled up share capital 1,303,118 1,298,118 1,298,118Share premium 7,352,508 7,306,486 7,306,486Legal reserves 60 60 -Share options reserve 109,275 109,275 -Exchange difference (3,353) - -Retained earnings (1,381,923) (690,524) (172,448) ------- ------- ------- Total shareholders' equity 7,379,685 8,023,415 8,432,156 ------- ------- ------- TOTAL EQUITY 7,379,685 8,023,415 8,432,156 ======= ======= ======= CONDOR RESOURCES PLC CONSOLIDATED CASH FLOW STATEMENT FOR THE SIX MONTHS TO 30 JUNE 2007 Six Six Months to Months to 30.06.07 30.06.06 £ £Cash flows from operating activitiesLoss before tax (691,399) (172,448)Exchange rate difference (3,353) -Depreciation charges 14,918 3,262Finance income (70,168) (29,009) ------- ------- (750,002) (198,195) (Decrease)/Increase in trade and other receivables 130,517 (26,516)(Decrease)/Increase in trade and other payables (61,096) 468,164 ------- ------- Net cash from operating activities (680,581) 243,453 Cash flows from investing activitiesAcquisition of subsidiaries - (55,570)Purchase of intangible fixed assets (520,230) (346,407)Purchase of tangible fixed assets (57,420) (30,703)Interest received 70,168 29,009 ------- ------- Net cash from investing activities (507,482) (403,671) ------- ------- Cash flows from financing activitiesProceeds from share issue 51,022 5,263,482Less issue costs - (776,571) ------- ------- Net cash from financing activities 51,022 4,486,911 (Decrease)/Increase in cash and cash equivalents (1,137,041) 4,326,693Cash and cash equivalents at beginning of period 3,456,183 - ------- -------Cash and cash equivalents at end of period 2,319,142 4,326,693 ======= ======= CONDOR RESOURCES PLC NOTES TO THE FINANCIAL STATEMENTS FOR THE SIX MONTHS TO 30 JUNE 2007 1. ACCOUNTING POLICIES Basis of preparation These financial statements have been prepared in accordance with InternationalFinancial Reporting Standards and with those parts of the Companies Act 1985applicable to companies reporting under IFRS. During the year ended 31 December 2006 the directors completed the initialaccounting of the acquisition of the company's subsidiary undertakings. As aresult, the amount of goodwill, as reported in the six month period to 31 August2006, was de-recognised and mineral resources were recognised at their fairvalue. The fair value given to the mineral resources was £3,600,443 The Interim report is unaudited and does not constitute statutory financialaccounts as defined in section 240 of the Companies Act 1985 The Interim Report for the six months ended 30 June 2007 was approved by theDirectors on 26 September 2007. The comparative period presented is that of 30 June 2006. The directors are ofthe opinion that due to the nature of the group's activities and the eventsduring that period these are the most appropriate comparatives for the currentperiod. Copies of the Interim Report are available from the Company's websitewww.condorresourcesplc.com. 2. REVENUE AND SEGMENTAL REPORTING The Group has not generated any revenue during the period. The Group's operations are located in England, El Salvador and Nicaragua. The following is an analysis of the carrying amount of segment assets, andadditions to plant and equipment, analysed by geographical area in which theassets are located. Carrying amount Additions to Depreciation Carrying amount Result of segment property, plant charged in the of liabilities for the assets & equipment and period period intangible assets Periods ended 30th June 2007 2006 2007 2006 2007 2006 2007 2006 2007 2006 £ £ £ £ £ £ £ £ £ £ England 6,225,533 8,543,112 165,380 3,643,040 1,442 - 105,340 466,201 (223,613) (124,385) El Salvador 834,136 354,546 104,102 327,963 10,800 3,262 5,017 1,963 (380,254) (47,002)Nicaragua 436,095 2,662 308,168 - 2,676 - 5,722 - (87,532) (1,061) ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ Total 7,495,764 8,900,320 577,650 3,971,003 14,918 3,262 116,079 468,164 (691,399) (172,448) ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ 3. TAX There is no current tax charge for the period. The accounts do not include adeferred tax asset in respect of carry forward unused tax losses as theDirectors are unable to assess that there will be probable future taxableprofits available against which the unused tax losses can be utilised. 4. EARNINGS PER SHARE Basic earnings per share is calculated by dividing the earnings attributable toordinary shareholders by the weighted average number of ordinary sharesoutstanding during the period. CONDOR RESOURCES PLC NOTES TO THE FINANCIAL STATEMENTS FOR THE SIX MONTHS TO 30 JUNE 2007 A reconciliation is set out below: Six months to Six months to 30.06.07 30.06.06Basic EPSLoss for the period (691,399) (172,448)Weighted average number of shares 130,145,086 49,637,127Loss per share (in pence) (0.53) (0.35) ------- -------Diluted EPS Loss for the period (691,399) (172,448)Weighted average number of shares 141,895,086 61,387,127 Loss per share (in pence) (0.49) (0.28) ------- ------- This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Condor Gold