31st Mar 2005 14:19
Petra Diamonds Ld31 March 2005 31 March 2005 Petra Diamonds Limited ("Petra" or "the Company") Chairman's Statement and Interim Results to 31 December 2004 The period since my last Chairman's letter, published in December 2004, has beenvery productive for the Company as we have moved significantly closer toachieving our goal of building a diamond group that combines successfulproducing mines with quality exploration assets. With exciting prospects aheadof us, I report the interim results for the six months to 31 December 2004. Results The loss for the period amounted to £4,197,050 (2003: loss £1,799,734) statedafter operating charges of £3,646,031 (2003: £1,458,980) and net financing costsof £551,019 (2003: £340,754). The increased loss over the comparative period was due to the level of activityand associated expenditure at the Alto Cuilo project for the six month period,which led to significant exploration developments. The Company's expenditure onAlto Cuilo will not remain at these levels from January 2005 due to an importantdevelopment with regards to the joint venture with BHP Billiton WorldExploration Inc ("BHP Billiton") as set out below. Net financing costs arose due to exchange movements on the restatement ofborrowings within the Petra group. Proposed Merger with Crown Diamonds On 8 February Petra Diamonds announced its proposed merger with Australianlisted Crown Diamonds NL ("Crown"). This transaction is a significant steptowards our long-term objective of becoming a significant player in the diamondindustry with a combination of quality producing mines and an impressiveexploration base. On completion of the merger, the enlarged Petra group will bedual listed on AIM and the ASX, enhancing liquidity and aiming to increase thescope of institutional investor interest due to asset base and marketcapitalisation. As noted when the proposed merger was announced, the transaction constitutes aReverse Takeover under the AIM rules. The Company's shares are currentlysuspended from trading on AIM until such time as an AIM Admission documentrelating to the proposed merger is published. Work is progressing well on thepreparation of the various documents and we will publish the AIM document andreturn to trading in the near future. Crown's current producing diamond assets are all situated in South Africa. Theyencompass Helam, Star and the Messina/Dancarl joint venture. All three of thesediamond operations are kimberlite fissure mines with life of mine in excess of15 years each and all three produce high quality diamond gem stones. It isestimated that the Crown operations will produce in excess of 167,000 carats ofgem quality stones in 2005. Crown has also agreed a joint venture with AIM and TSX listed Mano RiverResources Inc concerning the Kono diamond project in Sierra Leone, a kimberliteproject with several identified fissures from which small scale production isenvisaged during the next twelve months. Initial indications show goodgeochemical results with a fissure strike length greater than Crown's currentproducing mines. Crown also brings with it an experienced management team which is highly skilledin diamond mining production in South Africa. The two management teams togetherwill have the depth and knowledge to develop diamond opportunities anywhere onthe African continent. Alto Cuilo and BHP Billiton Further, I am pleased to announce an important development with regards to thejoint venture with BHP Billiton regarding the Alto Cuilo diamond project innorth eastern Angola. The joint venture agreement between Petra and BHP Billiton included an optionwith regards to BHP Billiton's funding of the project, and I am delighted toadvise you that BHP Billiton have formally elected to fund the Alto Cuilokimberlite exploration programme, with this funding taking effect from 1 January2005. The election by BHP Billiton represents important progress for the projectand for Petra and we look forward to working with BHP Billiton in moving theexploration programme ahead over the coming months. Drilling continues at Alto Cuilo and as at the end of February 2005 diamond coredrilling had been completed at 43 sites, with a total 6,436 metres having nowbeen drilled. Since commissioning of the diamond recovery plant (MB100 and DMS) in September2004, alluvial gravels from the Luangue river and kimberlitic material from theAC2 complex continued to be treated by the plant and as of 26 February 2005,4,927 macro diamonds have been recovered with a total mass of 1,241 carats. Conclusion Petra Diamonds is at a pivotal stage in its development and considerably closerto achieving its objective of becoming a significant producer of diamonds with abalanced portfolio of cash flow positive, producing mines combined with the "blue sky" of high quality exploration assets. The merger with Crown and thesupport of BHP Billiton puts the Company in a strong position to create ageographically diversified diamond group with a substantial asset base andmarket capitalisation, giving the Company the potential to become a nichemid-tier producer of rough diamonds. Adonis Pouroulis, Chairman 31 March 2005 For further information, please contact: Kevin Dabinett / David Abery Justine Howarth / Cathy Malins Petra Diamonds Parkgreen Communications Tel: +27 11 467 6710 Tel: +44 20 7493 3713 PETRA DIAMONDS LIMITED UNAUDITED CONSOLIDATED INCOME STATEMENT FOR THE SIX MONTH PERIOD ENDED 31 DECEMBER 2004 Unaudited Unaudited Audited 1 July 2004 1 July 2003 1 July 2003 31 December 31 December 30 June 2004 2003 2004 £ £ £ Other operating income - - 4,424 Other operating charges (3,646,031) (1,458,980) (3,978,460) Group operating loss (3,646,031) (1,458,980) (3,974,036) Net financing costs (551,019) (340,754) (245,827) Loss before and after taxation for the (4,197,050) (1,799,734) (4,219,863)financial period Basic and diluted loss per share - pence (6.17) (3.48) (7.45) UNAUDITED CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES FOR THE SIX MONTH PERIOD ENDED 31 DECEMBER 2004 Unaudited Unaudited Audited 1 July 1 July 2004- 31 2003 1 July 2003 December 2004 31 December 30 June 2004 2003 £ £ £Loss for the financial period (4,197,050) (1,799,734) (4,219,863) Exchange adjustments on translation of subsidiary 475,979 293,229 153,094andbranch undertakings recognised directly in equity Total recognised gains and losses relating to the (3,721,071) (1,506,505) (4,066,769)financial period PETRA DIAMONDS LIMITED UNAUDITED CONSOLIDATED BALANCE SHEETAT 31 DECEMBER 2004 Unaudited Unaudited Audited 31 December 2004 31 December 2003 30 June 2004 £ £ £ASSETSProperty, plant and equipment 2,301,919 493,033 1,782,408 Intangible assets 80,281 78,440 79,576 Investment in associates - - - Total non-current assets 2,382,200 571,473 1,861,984 Other receivables 615,970 306,917 550,838 Cash at bank and in hand 452,466 285,828 3,766,852 Total current assets 1,068,436 592,745 4,317,690 Total assets 3,450,636 1,164,218 6,179,674 EQUITY AND LIABILITIES Equity Issued capital 6,926,954 5,184,997 6,784,998 Share premium account 19,746,615 12,920,899 18,834,587 Foreign currency translation reserve 2,115,057 1,779,213 1,639,078 Accumulated loss (27,775,175) (21,157,996) (23,578,125) Total equity 1,013,451 (1,272,887) 3,680,538 Minority interests - - - Liabilities Trade and other payables 2,000,000 2,082,176 2,013,620 Total non-current liabilities 2,000,000 2,082,176 2,013,620 Trade and other payables 437,185 354,929 485,516 Total current liabilities 437,185 354,929 485,516 Total liabilities 2 ,437,185 2,437,105 2 ,499,136 Total equity, minority interests and 3,450,636 1,164,218 6,179,674liabilities PETRA DIAMONDS LIMITED NOTES TO THE INTERIM FINANCIAL STATEMENTS FOR THE SIX MONTH PERIOD ENDED 31 DECEMBER 2004 1. The interim results, which are unaudited, have been prepared inaccordance with International Financial Reporting Standards (IFRS) adopted bythe International Accounting Standards Board (IASB). The unaudited interim financial statements for the six months ended 31 December2004 do not constitute statutory accounts within the meaning of section 240 ofthe Companies Act 1985 and have been drawn up using accounting policies andpresentation consistent with those applied in the audited accounts for the yearended 30 June 2004. The financial information for the year ended 30 June 2004 has been extractedfrom the statutory accounts for that period, the auditors report on thoseaccounts was unqualified. 2. No dividends were proposed or paid during the period. 3. The calculation of basic loss per share is based on a loss for theinterim period of £4,197,050 and on a weighted average of 68,010,371 ordinaryshares of 10p each in issue during the period. 4. Due to losses incurred no taxation has been provided for. Deferred taxassets on losses have not been recognised as it is not foreseeable withsufficient certainty that the related tax benefit will be realised. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Petra Diamonds