3rd Mar 2009 10:11
FOR IMMEDIATE RELEASE 3 MARCH 2009
allied gold limited
("the Company")
Half-yearly REPORT 2008/2009
Allied Gold Limited has lodged its Half Yearly Financial Report ("Report") for the period ended 31 December 2008 today. Extracts are set out below:
DIRECTORS' REPORT
Your directors submit the consolidated interim financial report of Allied Gold Limited and its controlled entities (together referred to as the "economic entity" or "the Group") for the half-year ended 31 December 2008.
DIRECTORS
The Directors of the Company in office during or since the end of the half-year were:
Mr Mark V Caruso
Mr Gregory H Steemson
Mr Anthony Lowrie
Mr Frank Terranova (appointed 10 December 2008)
Mr Jeffrey J Moore (resigned 7 July 2008)
Mr Richard Johnson (resigned 3 October 2008)
Directors have been in office since the start of the financial year to the date of this report unless otherwise stated.
RESULTS
The consolidated loss of the economic entity after providing for income tax was $11,031,614 (2007: loss $3,961,102).
DIVENDENDS PAID OR RECOMMENDED
No dividends were paid or declared during or in respect of the half-year ended 31 December 2008.
REVIEW OF OPERATIONS
The principal focus of the Group during the half-year to 31 December 2008 has been on operational initiatives aimed at lowering per ounce cash production costs and generating a more consistent production profile.
Key operating statistics for the mining and processing activities for the period from 1 July 2008 to 31 December 2008 are summarised in the table below:
|
Key operating statistic |
Unit of measure |
Volume |
|
Waste mined |
tonnes |
105,819 |
|
Ore mined |
tonnes |
850,284 |
|
Ore processed |
tonnes |
762,696 |
|
Grade |
g/t gold |
1.91 |
|
Recovery |
% |
81.5 |
|
Gold produced |
ounces |
38,631 |
|
Gold sold |
ounces |
31,061 |
|
Average realised gold price $ / oz |
A$/oz US$/oz |
1,044 779 |
|
Operating cash cost $ / oz |
A$/oz US$/oz |
608 474 |
DIRECTORS' REPORT (continued)
Significant events during the half-year included:
In August 2008, Allied Gold successfully raised $10.5 million through a placement of shares with sophisticated investors, including its Joint Venture partner Barrick Gold Corporation.
Resources for the Sorowar deposit were increased by 815,000 ounces to approximately 3.2 million ounces.
Allied Gold continued to generate significant success from its comprehensive exploration program on Simberi Island, including the discovery of additional mineralisation at Sorowar and Pigiput East.
During the half-year Allied Gold repaid in excess of $11 million in secured bank debt, including $ 5 million in debt repaid using funds generated by the proactive management of the Group's hedge book. As a result of the accelerated debt repayments, the next scheduled debt repayment is not due until June 2009.
In accordance with its AUD$20 million farm-in to Allied Gold's exploration licence over Big Tabar and Tatau Islands, Barrick Gold commenced exploration activities in August 2008. During the half-year Barrick commenced drilling at the Tupinda copper prospect, completed two drill holes and commenced a third. An aerial geophysical electromagnetic survey covering the entire Tabar Island Group commenced in December 2008.
A Sulphide pre-feasibility study was commenced with a view to underpinning an expansion of the production profile by up to 200,000 ounces per annum by 2011.
SUBSEQUENT EVENTS
On 24 February 2009, the Company executed agreements with sophisticated investors for the placement of 61,649,000 shares for a total consideration of $30,824,500.
Other than the above matter, there has not arisen in the interval between the end of the financial period and the date of this report any item, transaction or event of a material and unusual nature likely, in the opinion of the Directors of the Company, to affect significantly the operations of the Company, the results of those operations or the state of affairs of the Company in future financial periods.
FUTURE DEVELOPMENTS, PROSPECTS AND BUSINESS STRATEGIES
A number of Group wide improvement and growth opportunities are being assessed by management including:
A sulphide pre-feasibility study to assess the economic and operational feasibility of developing a sulphide processing plant on Simberi Island has commenced.
A new Reserve upgrade for Sorowar and Pigiput East is planned for the March 2009 quarter. The results of this upgrade will influence the Group's decision whether to proceed with a proposed expansion of the Oxide plant beyond its current capacity of 2.2 million tonnes per annum.
In accordance with the existing farm-in agreement, Barrick is continuing its drilling programme on Tabar Island with assayed results expected during the March 2009 quarter.
Allied continues to assess a number of existing opportunities within the sector that may ultimately complement its existing strong organic growth profile.
In the opinion of the Directors it may prejudice the interests of the Company to provide additional information in relation to likely developments in the operations of the Company and the expected results of those operations in subsequent financial periods.
DIRECTORS' REPORT (continued)
OTHER INFORMATION
The registered office and principal place of business is Unit B9, 431 Roberts Road, Subiaco WA 6008.
AUDITOR'S INDEPENDENCE DECLARATION
The auditors' independence declaration under section 307C of the Corporations Act 2001 is set out on page 17 for the half-year ended 31 December 2008 and forms part of the directors report.
Signed in accordance with a resolution of the Directors.
|
Mark Caruso Executive Chairman |
Dated at Perth this 3rd day of March 2009
CONSOLIDATED INCOME STATEMENT
FOR THE HALF-YEAR ENDED 31 DECEMBER 2008
|
Half-year |
|||||
|
2008 |
2007 |
||||
|
Note |
$ |
$ |
|||
|
Revenue |
32,724,924 |
- |
|||
|
Cost of sales |
(24,928,578) |
- |
|||
|
Gross profit |
7,796,346 |
- |
|||
|
Unrealised losses on derivatives |
6 |
(3,540,748) |
- |
||
|
Corporate expenses |
(4,003,202) |
(982,105) |
|||
|
Share based remuneration |
10 |
(4,130,120) |
(921,744) |
||
|
Other operating expenses |
(3,416,323) |
(2,243,288) |
|||
|
Operating Loss |
(7,294,047) |
(4,147,137) |
|||
|
Impairment of available for sale assets |
7 |
(1,158,206) |
- |
||
|
Other expenses |
(1,407,970) |
(148,588) |
|||
|
Other income |
46,778 |
- |
|||
|
Financial income |
48,175 |
334,623 |
|||
|
Financial costs |
(1,266,344) |
- |
|||
|
Loss from continuing operations |
(11,031,614) |
(3,961,102) |
|||
|
Income tax benefit/(expense) |
- |
- |
|||
|
Loss after tax attributable to members of the parent entity |
(11,031,614) |
(3,961,102) |
|||
|
Basic loss per share (cents) |
(2.74) |
(1.16) |
|||
|
Diluted loss per share (cents) |
n/a |
n/a |
|||
The notes on pages 10 to 15 are an integral part of these consolidated interim financial statements.
CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2008
|
Note |
31 December 2008 $ |
30 June 2008 $ |
||
|
CURRENT ASSETS |
||||
|
Cash and cash equivalents |
1,718,906 |
154,180 |
||
|
Trade and other receivables |
1,527,811 |
1,758,073 |
||
|
Inventories |
15,421,496 |
7,401,734 |
||
|
Derivative financial instruments |
- |
314,212 |
||
|
Other assets |
250,369 |
531,032 |
||
|
Total Current Assets |
18,918,582 |
10,159,231 |
||
|
NON-CURRENT ASSETS |
||||
|
Derivative financial instruments |
- |
3,495,855 |
||
|
Available for sale financial assets |
7 |
243,300 |
1,185,074 |
|
|
Property, plant and equipment |
8 |
138,491,912 |
130,034,534 |
|
|
Exploration and evaluation expenditure |
13,664,936 |
10,406,786 |
||
|
Total Non-Current Assets |
152,400,148 |
145,122,249 |
||
|
Total Assets |
171,318,730 |
155,281,480 |
||
|
CURRENT LIABILITIES |
||||
|
Trade and other payables |
22,222,637 |
14,446,386 |
||
|
Borrowings |
11 |
7,743,025 |
8,561,286 |
|
|
Derivative financial instruments |
14,526,846 |
6,972,407 |
||
|
Provisions |
365,819 |
365,819 |
||
|
Total Current Liabilities |
44,858,327 |
30,345,898 |
||
|
NON CURRENT LIABILITIES |
||||
|
Derivative financial instruments |
3,985,130 |
18,911,174 |
||
|
Borrowings |
11 |
4,175,748 |
2,739,755 |
|
|
Provisions |
2,683,648 |
2,584,870 |
||
|
Total Non-Current Liabilities |
10,844,526 |
24,235,799 |
||
|
Total Liabilities |
55,702,853 |
54,581,697 |
||
|
NET ASSETS |
115,615,877 |
100,699,783 |
||
|
EQUITY |
||||
|
Issued capital |
9 |
143,602,145 |
133,686,704 |
|
|
Reserves |
(923,900) |
(16,956,167) |
||
|
Accumulated losses |
(27,062,368) |
(16,030,754) |
||
|
TOTAL EQUITY |
115,615,877 |
100,699,783 |
The notes on pages 10 to 15 are an integral part of these consolidated interim financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE HALF-YEAR ENDED 31 DECEMBER 2007
|
Issued Capital |
Accumulated Losses |
Share-based payments reserve |
Foreign exchange translation reserve |
Available for sale investments revaluation reserve |
Cash Flow Hedging Reserve |
Total |
|
|
$ |
$ |
$ |
$ |
$ |
$ |
$ |
|
|
At 1 July 2007 |
105,794,580 |
(6,491,791) |
1,912,347 |
22,575 |
758,090 |
- |
101,995,801 |
|
Changes in fair value of investments available for sale |
- |
- |
- |
- |
(376,955) |
- |
(376,955) |
|
Translation of foreign controlled entities |
- |
- |
- |
(151,406) |
- |
- |
(151,406) |
|
Changes in the fair value of cash flow hedges |
- |
- |
- |
- |
- |
(19,794,909) |
(19,794,909) |
|
Total income and expenses recognised directly in equity during the year |
- |
- |
- |
(151,406) |
(376,955) |
(19,794,909) |
(20,323,270) |
|
Loss for the period |
- |
(3,961,102) |
- |
- |
- |
- |
(3,961,102) |
|
Total recognised income and expense during the year |
- |
(3,961,102) |
- |
(151,406) |
(376,955) |
(19,794,909) |
(24,284,372) |
|
Share based payments |
- |
- |
921,744 |
- |
- |
- |
921,744 |
|
Conversion of options |
1,265,477 |
- |
- |
- |
- |
- |
1,265,477 |
|
At 31 December 2007 |
107,060,057 |
(10,452,893) |
2,834,091 |
(128,831) |
381,135 |
(19,794,909) |
79,898,650 |
The notes on pages 10 to 15 are an integral part of these consolidated interim financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE HALF-YEAR ENDED 31 DECEMBER 2008
|
Issued Capital |
Accumulated Losses |
Share-based payments reserve |
Foreign exchange translation reserve |
Available for sale investments revaluation reserve |
Cash Flow Hedging Reserve |
Total |
|
|
$ |
$ |
$ |
$ |
$ |
$ |
$ |
|
|
At 1 July 2008 |
133,686,704 |
(16,030,754) |
5,502,877 |
(392,076) |
6,546 |
(22,073,514) |
100,699,783 |
|
Changes in fair value of investments available for sale |
- |
- |
- |
- |
(24,768) |
- |
(24,768) |
|
Translation of foreign controlled entities |
- |
- |
- |
(463,502) |
- |
- |
(463,502) |
|
Changes in the fair value of cash flow hedges |
- |
- |
- |
- |
- |
12,817,527 |
12,817,527 |
|
Deferred hedging loss |
- |
- |
- |
- |
- |
(570,530) |
(570,530) |
|
Total income and expenses recognised directly in equity during the year |
- |
- |
- |
(463,502) |
(24,768) |
12,246,997 |
11,578,727 |
|
Loss for the period |
- |
(11,031,614) |
- |
- |
- |
- |
(11,031,614) |
|
Total recognised income and expense during the year |
- |
(11,031,614) |
- |
(463,502) |
(24,768) |
12,246,997 |
727,113 |
|
Cost of equity raising |
(621,010) |
- |
- |
- |
- |
- |
(621,010) |
|
Share-based payments |
- |
- |
4,273,540 |
- |
- |
- |
4,273,540 |
|
Share placements |
10,536,451 |
- |
- |
- |
- |
- |
10,536,451 |
|
At 31 December 2008 |
143,602,145 |
(27,062,368) |
9,776,417 |
(855,578) |
(18,222) |
(9,826,517) |
115,615,877 |
The notes on pages 10 to 15 are an integral part of these consolidated interim financial statements.
CONSOLIDATED CASHFLOW STATEMENT
FOR THE HALF-YEAR ENDED 31 DECEMBER 2008
|
Half-year |
||||
|
2008 $ |
2007 $ |
|||
|
CASH FLOWS FROM OPERATING ACTIVITIES |
||||
|
Receipts from customers |
33,012,629 |
- |
||
|
Payments to suppliers & employees |
(21,958,773) |
(477,430) |
||
|
Proceeds from settlement of derivatives |
5,144,710 |
- |
||
|
Interest received |
48,175 |
334,623 |
||
|
Interest paid |
(388,731) |
(1,849,849) |
||
|
Net cash generated from / (used in) operating activities |
15,858,010 |
(1,992,656) |
||
|
CASH FLOWS FROM INVESTING ACTIVITIES |
||||
|
Purchase of equity investments |
(241,200) |
- |
||
|
Purchase of plant & equipment |
(9,857,413) |
(1,630,595) |
||
|
Exploration and evaluation expenditure |
(3,721,696) |
(6,053,116) |
||
|
Assets under construction |
- |
(26,083,895) |
||
|
Net cash used in investing activities |
(13,820,309) |
(33,767,606) |
||
|
CASH FLOWS FROM FINANCING ACTIVTIES |
||||
|
Proceeds from the issue of securities |
10,806,452 |
1,265,477 |
||
|
Costs of issuing securities |
(239,633) |
- |
||
|
Finance lease payments |
(1,080,703) |
- |
||
|
Proceeds from borrowings |
2,900,000 |
23,393,561 |
||
|
Repayments of borrowings |
(12,859,098) |
- |
||
|
Net cash generated from / (used in ) financing activities |
(472,982) |
24,659,038 |
||
|
Net increase / (decrease) in cash held |
1,564,719 |
(11,101,224) |
||
|
Cash at beginning of the half-year |
154,180 |
12,657,949 |
||
|
Effects of exchange rate changes on the balance of cash and cash equivalents |
7 |
(151,403) |
||
|
Cash and cash equivalents at end of the half-year |
1,718,906 |
1,405,322 |
||
The notes on pages 10 to 15 are an integral part of these consolidated interim financial statements.
NOTES TO THE CONSOLIDATED INTERIM FINANCIAL REPORT
1. Reporting entity
Allied Gold Limited ("the Company") is a company incorporated in Australia and limited by shares, which are publicly traded on the Australian Stock Exchange. The consolidated interim financial report for the half-year ended 31 December 2008 comprises the Company and its controlled entities (together referred to as "the Group").
The consolidated annual report of the Group as at and for the year ended 30 June 2008 is available upon request from the Company's registered office at Unit B9, 431 Roberts Road, Subiaco WA 6008.
2. Statement of compliance
The consolidated interim financial report is a general-purpose financial report, which has been prepared in accordance with the requirements of the Corporations Act 2001 and AASB 134 Interim Financial Reporting.
The consolidated interim financial report does not include all of the information required for a full annual financial report and should be read in conjunction with the annual financial report of the Group as at and for the year ended 30 June 2008.
The financial report of Allied Gold Limited and its controlled entities for the half-year ended 31 December 2008 was approved by the directors on 3rd March 2009.
3. Significant accounting policies
The significant accounting policies applied by the Group in this consolidated interim financial report are the same as those applied by the Group in its consolidated financial report as at and for the year ended 30 June 2008.
4. Estimates
The preparation of the half-year financial statements in accordance with Australian Accounting Standards requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets, liabilities, income and expenses.
These estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.
In preparing this consolidated interim financial report, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated annual financial report as at and for the year ended 30 June 2008.
NOTES TO THE CONSOLIDATED INTERIM FINANCIAL REPORT (continued)
5. Segment reporting
The consolidated entity comprises the following main business segments, based on the consolidated entity's management and internal reporting structure:
Mining and processing
Mineral exploration
|
Mining and processing |
Mineral exploration |
Total |
||||
|
2008 |
2007 |
2008 |
2007 |
2008 |
2007 |
|
|
$ |
$ |
$ |
$ |
$ |
$ |
|
|
Revenue |
||||||
|
Sales to external customers |
32,724,924 |
- |
- |
- |
32,724,924 |
- |
|
Intersegment sales |
- |
- |
- |
- |
- |
- |
|
Total sales revenue |
32,724,924 |
- |
- |
- |
32,724,924 |
- |
|
Other revenue |
- |
- |
- |
- |
- |
- |
|
Total segment revenue |
32,724,924 |
- |
- |
- |
32,724,924 |
- |
|
Intersegment eliminations |
- |
- |
- |
- |
- |
- |
|
Unallocated revenue |
94,953 |
334,623 |
- |
- |
94,953 |
334,623 |
|
Consolidated revenue |
32,819,877 |
334,623 |
- |
- |
32,819,877 |
334,623 |
|
Result |
||||||
|
Segment result |
4,255,598 |
- |
- |
- |
4,255,598 |
- |
|
Intersegment eliminations |
- |
- |
- |
- |
- |
- |
|
Unallocated revenue less unallocated expenses |
(15,287,212) |
(3,961,102) |
- |
- |
(15,287,212) |
(3,961,102) |
|
Loss before income tax |
(11,031,614) |
(3,961,102) |
- |
- |
(11,031,614) |
(3,961,102) |
|
Income Tax |
- |
- |
- |
- |
- |
- |
|
Loss for the year |
(11,031,614) |
(3,961,102) |
- |
- |
(11,031,614) |
(3,961,102) |
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL REPORT (continued)
6. Derivative financial instruments
During the half-year the Group closed out certain sold put options maturing in the period March 2011 to December 2011.
The effects of this are that
The cumulative loss of $570,530 existing in the Hedging Reserve at the time that the options was sold will remain in equity and be recognised when the forecast transactions that they were hedging are recognised in the income statement.
The call options with a corresponding maturity and entered into in conjunction with the sold put options as a component of an effective hedge of gold price risk no longer meet the hedge effectiveness criteria. In accordance with the Group's accounting policies they were classified as derivatives held for trading and all subsequent changes in their fair value were taken directly to the income statement. The total of those unrealised losses for the period was $3,540,748.
7. Available for sale financial assets
During the six months ended 31 December 2008 the Group recognised an impairment loss of $1,158,206 in relation to listed equity investments. These investments declined significantly in value during the six months and in the view of the Directors the decline in value is not considered to be temporary.
The impairment loss has been recognised in the income statement.
8. Property plant and equipment
During the six months ended 31 December 2008, the Group acquired assets with a cost of $7,215,357 (six months ended 31 December 2007: 26,421,389). This included assets capitalised under finance leases of $5,711,334 (six months ended 31 December 2007:$ nil).
9. Contributed equity
|
2008 |
2007 |
2008 |
2007 |
||||
|
Number of shares |
Number of shares |
$ |
$ |
||||
|
(a) Ordinary shares |
410,994,276 |
342,014,710 |
143,602,565 |
107,060,057 |
|||
|
Balance at 1 July |
377,005,725 |
337,649,110 |
133,686,704 |
105,794,580 |
|||
|
Shares issued through capital raising |
33,988,551 |
- |
10,536,451 |
- |
|||
|
Shares issued on exercise of options |
- |
4,365,600 |
- |
1,265,477 |
|||
|
144,223,155 |
107,060,057 |
||||||
|
Costs of capital raising |
(621,010) |
- |
|||||
|
Balance at 31 December |
410,994,276 |
342,014,710 |
143,602,145 |
107,060,057 |
Ordinary shares entitle the holder to one vote per share and to participate in dividends and proceeds on winding up of the company in proportion to the number of and amounts paid on the shares held.
(b) Options
Options granted and exercised during the period, and on issue at balance date are as follows.
|
Date and details of grant/exercise |
No. of Options |
Exercise Price |
Expiry Date |
|
As at 1 July 2008 |
17,333,261 |
Various |
Various |
|
1 December 2008 |
15,650,000 |
$0.35 |
30 November 2011 |
|
5 December 2008 |
14,000,000 |
$0.35 |
31 October 2011 |
|
29 December 2008 |
8,000,000 |
$0.35 |
30 November 2011 |
|
31 December 2008 |
1,699,427 |
$0.31 |
31 December 2010 |
|
Options lapsed or cancelled |
(7,850,000) |
Various |
Various |
|
As at 31 December 2008 |
48,832,688 |
||
Each option is convertible into one ordinary share in the company when exercised. Options do not participate in dividends and do not give holders voting rights.
10. Share based payments
In 2006, the group established a share option program that entitles key management personnel and senior employees to purchase shares in the entity. The terms and conditions of the share option programme are disclosed in the consolidated financial report as at and for the year ended 30 June 2008. The Group uses the binomial option pricing methodology.
The terms and conditions of the grants made during the six months ended 31 December 2008 are as follows:
Employee options issued 1 December 2008
|
Tranche A options |
Tranche B options |
Tranche C options |
|||||
|
Fair value at grant date |
$0.0924 |
$0.0924 |
$0.0858 |
||||
|
Exercise price |
$0.35 |
$0.35 |
$0.35 |
||||
|
Grant date |
1/12/2008 |
1/12/2008 |
1/12/2008 |
||||
|
Expiry date |
31/10/2011 |
31/10/2011 |
31/10/2011 |
||||
|
Share price at grant date |
$0.27 |
$0.27 |
$0.27 |
||||
|
Expected price volatility of shares |
60% |
60% |
60% |
||||
|
Expected dividend yield |
0% |
0% |
0% |
||||
|
Risk free interest rate |
3.27% |
3.27% |
3.27% |
||||
|
Discount applied in relation to vesting conditions |
0% |
30% |
0% |
Director options issued 5 December 2008
|
Tranche A options |
Tranche B options |
Tranche C options |
|||||
|
Fair value at grant date |
$0.097 |
$0.097 |
$0.0905 |
||||
|
Exercise price |
$0.35 |
$0.35 |
$0.35 |
||||
|
Grant date |
5/12/2008 |
5/12/2008 |
5/12/2008 |
||||
|
Expiry date |
30/11/2011 |
30/11/2011 |
30/11/2011 |
||||
|
Share price at grant date |
$0.275 |
$0.275 |
$0.275 |
||||
|
Expected price volatility of shares |
60% |
60% |
60% |
||||
|
Expected dividend yield |
0% |
0% |
0% |
||||
|
Risk free interest rate |
3.24% |
3.24% |
3.24% |
||||
|
Discount applied in relation to vesting conditions |
0% |
30% |
0% |
Employee options issued 29 December 2008
|
Tranche A options |
Tranche B options |
Tranche C options |
|||||
|
Fair value at grant date |
$0.2009 |
$0.2009 |
$0.195 |
||||
|
Exercise price |
$0.35 |
$0.35 |
$0.35 |
||||
|
Grant date |
1/12/2007 |
1/12/2007 |
1/12/2007 |
||||
|
Expiry date |
31/10/2011 |
31/10/2011 |
31/10/2011 |
||||
|
Share price at grant date |
$0.425 |
$0.425 |
$0.425 |
||||
|
Expected price volatility of shares |
60% |
60% |
60% |
||||
|
Expected dividend yield |
0% |
0% |
0% |
||||
|
Risk free interest rate |
2.95% |
2.95% |
2.95% |
||||
|
Discount applied in relation to vesting conditions |
0% |
30% |
0% |
The terms of each Tranche of options are summarised below:
Tranche A - vest on grant date.
Tranche B - vest upon the 100,000th ounce of gold production between 1 October 2008 and 31 December 2009. Upon production of 75,000 ounces within that timeframe, the Directors have the discretion to require the holder to exercise 50% of the Tranche B options in which case the holder will forego the balance of the options.
Tranche C - vest when the weighted average price of Allied shares is greater than 70 cents for five consecutive days.
NOTES TO THE CONSOLIDATED INTERIM FINANCIAL REPORT (continued)
11. Loans and borrowings
The following loans and borrowings were drawn down and repaid during the six months ended 31 December 2008:
|
Half-year |
||
|
2008 |
2007 |
|
|
$ |
$ |
|
|
Balance at 1 July |
11,301,041 |
- |
|
New Issues |
||
|
Secured bank loan (USD) |
- |
23,393,561 |
|
Finance lease liabilities (PGK and AUD) |
5,671,404 |
- |
|
Unsecured loans (AUD) |
2,900,000 |
- |
|
Impact of exchange rates |
5,207,294 |
- |
|
Repayments |
||
|
Secured bank loan (USD) |
(11,459,098) |
- |
|
Finance lease liabilities (PGK and AUD) |
(301,868) |
- |
|
Unsecured loans (AUD) |
(1,400,000) |
- |
|
Balance at 31 December |
11,918,773 |
23,393,651 |
12. Related party transactions
Arrangements with related parties continue to be in place. With the exception of the items described below, the nature and terms of transactions with related parties are consistent with those described in the consolidated financial report for the year ended 30 June 2008.
Mine Site Construction Services provides goods and services including the hire of mining equipment to the Group. During the six months ended 31 December 2008, equipment hire contracts that were previously disclosed as operating leases were recorded as finance leases pursuant to a modification in the terms of those agreements (refer note 11).
13. Going concern basis
As at 31 December 2008 the financial statements indicated a prima facie working capital deficiency of AUD$25,939,745. Notwithstanding this prima facie deficiency the Board has determined that it is appropriate to apply the Going Concern basis in the preparation of the financial statements for the following reasons:
Included in current liabilities were amounts of AUD$14,526,846 relating to derivative financial instruments that will be satisfied through the delivery of gold production into the respective hedge contracts. It is not anticipated that any of these liabilities will require cash settlement to satisfy the obligation.
In the six months to 31 December 2008 the entity generated cash flow from operations of AUD$10,713,300 (net of proceeds from sale of derivatives). Given prevailing market conditions and the current forecast production profile it is anticipated that significant operating cash flows will continue to be generated in the coming period.
Inventories in the balance sheet are recorded at the lower of cost or net realisable value which is significantly lower than the gold price at which the inventories are expected to be realised.
14. Subsequent events
On 24 February 2009, the Company executed agreements with sophisticated investors for the placement of 61,649,000 shares for a total consideration of $30,824,500.
DECLARATION BY DIRECTORS
The Directors of Allied Gold Limited declare that:
1. The consolidated financial statements comprising the income statement, balance sheet, cash flow statement, statement of changes in equity and accompanying notes are in accordance with the Corporations Act 2001 and:
(a) comply with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001; and
(b) give a true and fair view of the economic entity's financial position as at 31 December 2008 and of its performance for the half-year ended on that date .
2. In the directors' opinion, there are reasonable grounds to believe that Allied Gold Limited will be able to pay its debts as and when they become due and payable.
Signed in accordance with a resolution of the Directors:
|
Mark Caruso Executive Chairman |
Dated at Perth this 3rd day of March 2009
A copy of the full report including the audit review statement can be viewed and downloaded on the Company's website in due course - www.alliedgold.com.au.
http://www.rns-pdf.londonstockexchange.com/rns/2069O_-2009-3-3.pdf
For enquiries in connection with the above, please contact:
Mark Caruso
Executive Chairman
Allied Gold Limited
+ 61 8 9353 3638
Roland Cornish
Beaumont Cornish Limited
020 7628 3396
Related Shares:
ALD.L