11th Aug 2006 07:01
European Goldfields Ltd11 August 2006 European Goldfields Limited Interim Consolidated Financial Statements (Unaudited) For the Three- and Six-Month Periods Ended 30 June 2005 and 2006 Disclosure of auditor review of interim consolidated financial statements The interim consolidated financial statements of the Company for the three- andsix-month periods ended 30 June 2006 and 2005 have not been reviewed by theauditors of the Company. European Goldfields LimitedConsolidated Balance SheetsAs at 30 June 2006 and 31 December 2005(Unaudited - Prepared by Management)(in thousands of US Dollars, except per share amounts) 30 June 31 December 2006 2005 $ $Assets Note Unaudited Audited Current assetsCash and cash equivalents 33,086 30,536Accounts receivable, prepaid expenses andsupplies 7,905 5,352Inventory 3 2,734 1,865 --------- --------- 43,724 37,753 --------- --------- Non current assetsPlant and equipment 4 22,040 19,374Deferred exploration and development costs 5Greek production stage mineral properties 14,992 10,129Greek development stage mineral properties 173,102 162,738 --------- --------- 188,094 172,867Romanian development stage mineral properties 30,113 27,843 --------- --------- 218,207 200,710 --------- --------- Restricted investment 6 3,815 3,543 Future tax asset 4,450 5,238 --------- --------- 292,236 266,618 --------- --------- Liabilities Current liabilitiesAccounts payable and accrued liabilities 7,271 3,988 Non current liabilitiesFuture tax liability 7 46,988 43,261Non-controlling interest 16,241 14,239Asset retirement obligation 8 5,789 5,307 --------- --------- 69,018 62,807 --------- ---------Shareholders' equityCapital stock 9 244,496 240,234Contributed surplus 9 6,816 6,197Cumulative translation adjustment (750) (12,843)Deficit (34,615) (33,765) --------- --------- 215,947 199,823 --------- --------- --------- --------- 292,236 266,618 --------- --------- The accompanying notes are an integral part of these interim consolidated financial statements. Approved by the Board of Directors (s) Timothy Morgan-Wynne (s) Jeffrey O'LearyTimothy Morgan-Wynne, Director Jeffrey O'Leary, Director European Goldfields LimitedConsolidated Statements of Loss and DeficitFor the three- and six-month periods ended at 30 June 2006 and 2005(Unaudited - Prepared by Management)(in thousands of US Dollars, except per share amounts) 3 months ended 30 June 6 months ended 30 June 2006 2005 2006 2005 $ $ $ $ IncomeSales 8,274 57 17,357 57Cost of sales (includingamortisation and depletionof $1,174 in 2006) (3,944) - (8,732) - -------- -------- -------- --------Gross profit 4,330 57 8,625 57 -------- -------- -------- -------- Other income -------- -------- -------- --------Interest income 267 326 567 652 -------- -------- -------- -------- ExpensesCorporate administrative andoverhead expenses 467 697 1,002 1,582Equity-based compensationexpense 758 196 1,431 322Foreign exchange (gain)/loss (201) (71) (217) 928Hellas Gold administrativeand overhead expenses 1,056 140 1,800 745Hellas Gold water treatmentexpenses 893 1,250 1,386 2,207(non-operating mines)Hellas Gold old adit andequipment maintenance(Stratoni mine) 1,124 - 2,026 -Accretion of assetretirement obligation 28 - 54 -Amortisation 220 75 421 334 -------- -------- -------- -------- 4,345 2,287 7,903 6,118 -------- -------- -------- -------- -------- -------- -------- --------Profit/(loss) for the periodbefore income tax 252 (1,904) 1,289 (5,409) Income taxesCurrent taxes - - - -Future taxes -(reduction)/increase ofdeferred tax asset (563) 1,058 (1,439) 1,770 -------- -------- -------- -------- (563) 1,058 (1,439) 1,770 -------- -------- -------- -------- -------- -------- -------- --------Loss for the period afterincome tax (311) (846) (150) (3,639) Non-controlling interest (225) 123 (700) 264 -------- -------- -------- --------Loss for the period (536) (723) (850) (3,375) Deficit - Beginning ofperiod (34,079) (26,007) (33,765) (23,355) -------- -------- -------- -------- Deficit - End of period (34,615) (26,730) (34,615) (26,730) -------- -------- -------- -------- Profit/(loss) per share (0.00) (0.01) (0.01) (0.03) Weighted average number ofshares (in thousands) 113,847 112,174 112,673 112,109 The accompanying notes are an integral part of these interim consolidated financial statements. European Goldfields LimitedConsolidated Statements of EquityAs at 30 June 2006 and 2005(Unaudited - Prepared by Management)(in thousands of US Dollars, except per share amounts) Capital Contributed Cumulative Deficit Total Stock Surplus Translation Adjustment $ $ $ $ $ --------- --------- --------- --------- ---------Balance - 31 December2004 238,420 5,589 8,964 (23,355) 229,618 --------- --------- --------- --------- --------- Equity-basedcompensation expense - 322 - - 322Share options exercised 287 (117) - - 170Milestone shares issuedas compensation 725 (725) - - -Share issue costs (14) - - - (14)Movement in cumulativetranslation adjustment - - (2,581) - (2,581)Loss for the period - - - (3,375) (3,375) --------- --------- --------- --------- --------- 998 (520) (2,581) (3,375) (5,478) --------- --------- --------- --------- --------- --------- --------- --------- --------- ---------Balance - 30 June 2005 239,418 5,069 6,383 (26,730) 224,140 --------- --------- --------- --------- --------- Equity-basedcompensation expense - 1,943 - - 1,943Restricted share unitsvested 815 (815) - - -Share issue costs 1 - - - 1Movement in cumulativetranslation adjustment - - (19,226) - (19,226)Loss for the period - - - (7,035) (7,035) --------- --------- --------- --------- --------- 816 1,128 (19,226) (7,035) (24,317) --------- --------- --------- --------- --------- --------- --------- --------- --------- ---------Balance - 31 December2005 240,234 6,197 (12,843) (33,765) 199,823 --------- --------- --------- --------- --------- Equity-basedcompensation expense - 2,429 - - 2,429Restricted share unitsvested 435 (435) - - -Share options exercised 3,827 (1,375) - - 2,452Movement in cumulativetranslation adjustment - - 12,093 - 12,093Loss for the period - - - (850) (850) --------- --------- --------- --------- --------- 4,262 619 12,093 (850) 16,124 --------- --------- --------- --------- --------- --------- --------- --------- --------- ---------Balance - 30 June 2006 244,496 6,816 (750) (34,615) 215,947 --------- --------- --------- --------- --------- The accompanying notes are an integral part of these interim consolidated financial statements. European Goldfields LimitedConsolidated Statements of Cash FlowsFor the three- and six-month periods ended 30 June 2006 and 2005(Unaudited - Prepared by Management)(in thousands of US Dollars, except per share amounts) 3 months ended 6 months ended 30 June 30 June 2006 2005 2006 2005 $ $ $ $ Cash flows from operating activitiesLoss for the period (536) (723) (850) (3,375)Foreign exchange loss/(gain) 170 (71) 143 928Amortisation 458 75 876 334Equity-based compensation expense 782 196 1,505 322Accretion of asset retirement obligation 28 - 54 -Future tax asset recognised 563 (1,058) 1,439 (1,770)Non-controlling interest 225 (123) 700 (264)Depletion of mineral properties 440 - 677 - --------- --------- --------- --------- 2,130 (1,704) 4,544 (3,825) Net changes in non-cashworking capital 1,001 (404) 92 (1,337) --------- --------- --------- --------- 3,131 (2,108) 4,636 (5,162) --------- --------- --------- --------- Cash flows from investing activitiesDeferred exploration anddevelop. costs - Romania (992) (893) (1,840) (1,752)Plant and equipment - Greece (1,599) (2,453) (2,167) (4,035)Deferred development costs -Greece (999) (891) (1,475) (891)Proceeds from disposal ofequipment - 18 - 18Purchase of equipment (25) (57) (68) (98)Restricted investment 12 - 12 - --------- --------- --------- --------- (3,603) (4,276) (5,538) (6,758) --------- --------- --------- --------- Cash flows from financing activitiesProceeds from exercise ofshare options 2,391 - 2,452 170Share issue costs - - - (14) --------- --------- --------- --------- 2,391 - 2,452 156 --------- --------- --------- --------- Effect of foreign currencytranslation on cash 827 (1,760) 1,000 (3,509) --------- --------- --------- --------- Increase/(decrease) in cashand cash equivalents 2,746 (8,144) 2,550 (15,273) Cash and cash equivalents -Beginning of period 30,340 58,124 30,536 65,253 --------- --------- --------- --------- Cash and cash equivalents -End of period 33,086 49,980 33,086 49,980 --------- --------- --------- --------- The accompanying notes are an integral part of these interim consolidated financial statements. European Goldfields LimitedNotes to Consolidated Financial StatementsFor the three- and six-month periods ended 30 June 2006 and 2005(Unaudited - Prepared by Management)(in thousands of US Dollars, except per share amounts) 1. Nature of operations European Goldfields Limited (the "Company"), a company incorporated under theYukon Business Corporations Act, is a resource company involved in theacquisition, exploration and development of mineral properties in Greece,Romania and the Balkans. The Company's common shares are listed on the AIM Market of the London StockExchange and on the Toronto Stock Exchange (TSX) under the symbol "EGU". Greece - The Company holds a 65% interest in Hellas Gold S.A. ("Hellas Gold").Hellas Gold owns assets in northern Greece which consist of three depositswithin 70-year mining concessions covering a total area of 317 km(2). Thedeposits include the polymetallic projects of Stratoni and Olympias whichcontain gold, lead, zinc and silver, and the copper/gold porphyry body referredto as Skouries. The three deposits are located within a 10 km radius of each other. BothStratoni and Olympias were previously in production and have existing mining andplant infrastructure and a ship-loading facility on the Aegean Sea. Hellas Gold's assets also include revenue-generating stockpiles of goldconcentrates. In September 2005, Hellas Gold resumed production at Stratoni following theaward by the Greek state of all necessary environmental and mining permits.Hellas Gold is in the process of applying for similar permits for Olympias andSkouries, having met its first milestone by submitting business plans to theGreek government in January 2006. Romania - The Company holds four mineral properties located within the "GoldenQuadrilateral" area of Romania. The Company recently announced the conversion ofresources into Canadian NI 43-101 compliant reserves for its 80%-owned Certejproject, underpinning the value of the project. The Company is now completing afinal feasibility study for submission to the Romanian government by the end of2006, in support of an application for environmental and mining permits todevelop the Certej project. The underlying value of the deferred exploration and development costs formineral properties is dependent upon the existence and economic recovery ofreserves in the future, and the ability to raise long-term financing to completethe development of the properties. For the coming year, the Company believes it has adequate funds available tomeet its corporate and administrative obligations and its planned expenditureson its mineral properties. These interim consolidated financial statements have been prepared on a goingconcern basis, which assumes the Company will be able to realise assets anddischarge liabilities in the normal course of business for the foreseeablefuture. These interim consolidated financial statements do not include theadjustments that would be necessary should the Company be unable to continue asa going concern. 2. Significant accounting policies These interim consolidated financial statements have been prepared on the goingconcern basis in accordance with Canadian GAAP using the same accountingpolicies as those disclosed in Note 4 to the Company's audited consolidatedfinancial statements for the years ended 31 December 2005 and 2004. These interim consolidated financial statements should be read in conjunctionwith the Company's audited consolidated financial statements for the years ended31 December 2005 and 2004. 3. Inventory This balance comprises the following: 30 June 31 December 2006 2005 $ $ Ore mined 950 583Metal concentrates 1,236 1,274Material and supplies 548 8 --------- ----------- 2,734 1,865 --------- ----------- 4. Plant and equipment Exploration Vehicles Land and Leasehold Total /office buildings improvements equipment $ $ $ $ $Cost - 2006 At 31 December 2005 5,559 1,134 13,402 223 20,318 Additions 2,202 - - 33 2,235Disposals - - - - -Currency translationadjustment 423 71 1,089 - 1,583 -------- -------- -------- ---------- --------At 30 June 2006 8,184 1,205 14,491 256 24,136 -------- -------- -------- ---------- -------- Accumulatedamortisation - 2006 At 31 December 2005 420 372 119 33 944 Provision forthe period 574 132 318 13 1,037Disposals - - - - -Currency translationadjustment 48 30 37 - 115 -------- -------- -------- ---------- --------At 30 June 2006 1,042 534 474 46 2,096 -------- -------- -------- ---------- -------- -------- -------- -------- ---------- --------Net book valueat 30 June 2006 7,142 671 14,017 210 22,040 -------- -------- -------- ---------- -------- 5. Deferred exploration and development costs Romanian mineral properties: Certej Baita- Voia Cainel Total Craciunesti $ $ $ $ $ -------- -------- -------- -------- --------Balance - 31 December2005 23,400 2,948 513 982 27,843 -------- -------- -------- -------- -------- Drilling and assaying 487 1 57 1 546Geosciences and tech.consulting 390 17 35 6 448Samplers, miners andsurveying 26 1 - - 27Project management 593 7 9 - 609Project overhead 521 14 43 13 591Amortisation 39 4 1 5 49 -------- -------- -------- -------- -------- 2,056 44 145 25 2,270 -------- -------- -------- -------- --------Balance - 30 June 2006 25,456 2,992 658 1,007 30,113 -------- -------- -------- -------- -------- The Certej exploitation licence and the Baita-Craciunesti exploration licenceare held by the Company's 80%-owned subsidiary, Deva Gold S.A. ("Deva Gold").Minvest S.A. (a Romanian state owned mining company), together with threeprivate Romanian companies, hold the remaining 20% interest in Deva Gold and theCompany holds the pre-emptive right to acquire such 20% interest. The Company isrequired to fund 100% of all costs related to the exploration and development ofthese properties. As a result, the Company is entitled to the refund of suchcosts (plus interest) out of future cash flows generated by Deva Gold, prior toany dividends being distributed to shareholders. The Voia and Cainel explorationlicences are held by the Company's wholly-owned subsidiary, European GoldfieldsDeva SRL. Individual property spending commitments for each of the Company's Romanianlicences have been met as at 30 June 2006. Greek mineral properties: Stratoni Skouries Olympias Total $ $ $ $ ---------- ---------- ----------- --------Balance - 31 December 2005 14,861 62,624 95,382 172,867 ---------- ---------- ----------- -------- Deferred development costs - 1,093 945 2,038Depletion of mineral properties (695) - - (695)Currency translation adjustment 826 5,176 7,882 13,884 ---------- ---------- ----------- -------- 131 6,269 8,827 15,227 ---------- ---------- ----------- --------Balance - 30 June 2006 14,992 68,893 104,209 188,094 ---------- ---------- ----------- -------- The Stratoni, Skouries and Olympias properties are held by the Company's65%-owned subsidiary, Hellas Gold. In September 2005, the Stratoni propertycommenced production. 6. Restricted investment The balance consists of an amount of $3,815 (€3 million) pledged by Hellas Goldto the National Bank of Greece as collateral for a letter of guarantee issued bythe National Bank of Greece to the Greek Ministry of Development to guaranteeHellas Gold's environmental commitments under its mining permit at Stratoni. Theletter of guarantee expires on 31 December 2010. The investment bears a rate ofinterest of Euribor plus 0.8% per annum. 7. Future tax liability The following table reflects future income tax liabilities: 30 June 31 December 2006 2005 $ $ --------- ----------Mineral properties 44,519 41,213Plant and equipment 1,118 1,276Exploration and development expenditure 1,351 772 --------- ---------- 46,988 43,261 --------- ---------- The tax liability arises as a result of the increase in value placed on themineral properties held by Hellas Gold on acquisition by the Company. Thisfuture tax liability will reverse as the corresponding mineral properties areamortised. 8. Asset retirement obligation Management has estimated the total future asset retirement obligation based onthe Company's net ownership interest in the Olympias, Skouries and Stratonimines and facilities. This includes all estimated costs to dismantle, remove,reclaim and abandon the facilities and the estimated time period during whichthese costs will be incurred in the future. The following table reconciles theasset retirement obligations as at 30 June 2006 and 31 December 2005: 30 June 31 December 2006 2005 $ $ --------- ----------Asset retirement obligation - Beginning of period 5,307 5,811Additional obligation - -Currency translation adjustment 428 (771)Accretion expense 54 267 --------- ----------Asset retirement obligation - End of period 5,789 5,307 --------- ---------- As at 30 June 2006, the undiscounted amount of estimated cash flows required tosettle the obligation was $6,448 (31 December 2005 - $5,970). The estimated cashflow has been discounted using a credit adjusted risk free rate of 5.04%. Theexpected period until settlement is six years. 9. Capital stock Authorised: - Unlimited number of common shares, without par value- Unlimited number of preferred shares, issuable in series, without par value Issued and outstanding (common shares - all fully paid): Number of Amount Shares $ --------- ---------- --------- ----------Balance - 31 December 2005 112,598,708 240,234 --------- ---------- Restricted share units vested 165,000 435Share options exercised 1,084,168 3,827Share issue costs - - --------- ---------- 1,249,168 4,262 --------- ---------- --------- ----------Balance - 30 June 2006 113,847,876 244,496 --------- ---------- As at 30 June 2006, the Company had Nil common shares held in escrow or inrespect of which trading restrictions applied. Contributed surplus: 30 June 31 December 2006 2005 $ $Equity-based compensation expense 6,238 5,619Broker warrants 578 578 ---------- ---------- 6,816 6,197 ---------- ---------- 10. Share options and restricted share units Share Option Plan The Company operates a Share Option Plan (together with its predecessor, the"Share Option Plan") authorising the directors to grant options to acquirecommon shares of the Company to the directors, officers, employees andconsultants of the Company and its subsidiaries, on terms that the Board ofDirectors may determine, within the limitations of the Share Option Plan. As at 30 June 2006, the following share options were outstanding: Number of Exercise Options price C$Expiry date2007 50,000 2.502009 325,000 2.802009 240,000 3.202009 250,000 4.202009 535,000 3.072009 285,000 3.152010 1,020,999 2.002010 75,000 2.112010 150,000 2.402011 600,000 3.852011 200,000 4.10 --------- --------- 3,730,999 2.97 --------- --------- During the six-month period ended 30 June 2006, share options were granted,exercised and cancelled as follows: Number of Weighted Options average exercise price C$ --------- ---------Balance - 31 December 2005 4,684,333 2.58 --------- --------- Options granted 800,000 3.91Options exercised (1,084,168) 2.47Options cancelled (669,166) 2.43 --------- ---------Balance - 30 June 2006 3,730,999 2.97 --------- --------- Of the 3,730,999 share options outstanding as at 30 June 2006, 2,547,166 werefully vested and had a weighted average exercise price of C$2.80 per share. The weighted average grant date fair value of the 800,000 share options grantedduring the six-month period ended 30 June 2006 (2005 - Nil) was C$3.91 (2005 -Nil). For outstanding share options which were not fully vested during thesix-month period ended 30 June 2006, the Company incurred a total equity-basedcompensation cost of $675 (2005 - $1,431) of which $613 (2005 - $1,431) has beenrecognised as an expense in the income statement and $62 (2005 - Nil) has beencapitalised to deferred exploration and development costs. Restricted Share Unit Plan The Company operates a Restricted Share Unit Plan (the "RSU Plan") authorisingthe directors, based on recommendations received from the CompensationCommittee, to grant Restricted Share Units ("RSUs") to designated directors,officers, employees and consultants. The RSUs are "phantom" shares that rise andfall in value based on the value of the Company's common shares and are redeemedfor actual common shares on the vesting dates determined by the Board ofDirectors when the RSUs are granted. The RSUs would typically become 100% vestedupon a change of control of the Company. The maximum number of common shares ofthe Company which may be reserved for issuance for all purposes under the RSUPlan shall not exceed 2.5% of the common shares issued and outstanding from timeto time. As at 30 June 2006, the following RSUs were outstanding: Vesting date Number of Grant date RSUs fair value of underlying shares C$ 31 December 2006 400,000 2.1931 December 2006 * 415,000 4.041 July 2007 ** 250,000 4.0431 December 2007 350,000 2.1931 December 2007 235,000 4.04 --------- --------- 1,650,000 3.20 --------- --------- * Of which 100,000 RSUs vest on 31 December 2006 provided certain operationalmilestones are achieved by such date. ** Or earlier if certain operational milestones are achieved. Vestingconditional upon such milestones being achieved by 1 July 2007. During the six-month period ended 30 June 2006, RSUs were granted, vested andcancelled as follows: Number of Weighted RSUs average grant date fair value of underlying shares C$ --------- ---------Balance - 31 December 2005 750,000 2.19 --------- --------- RSUs granted 1,065,000 3.88RSUs vested (165,000) 3.00RSUs cancelled - - --------- ---------Balance - 30 June 2006 1,650,000 3.20 --------- --------- The weighted average grant date fair value of underlying shares of the 1,065,000RSUs granted during the six-month period ended 30 June 2006 (2005 - Nil) wasC$3.88 (2005 - Nil). For outstanding RSUs which were not fully vested during thesix-month period ended 30 June 2006, the Company incurred a total equity-basedcompensation cost of $1,797 (2005 - Nil) of which $893 (2005 - Nil) has beenrecognised as an expense in the income statement and $904 (2005 - Nil) has beencapitalised to deferred exploration and development costs. 11. Supplementary cash flow information 30 June 30 June 2006 2005 $ $ --------- ---------Changes in non-cash operating accounts:Accounts receivable, prepaid expenses and supplies (2,552) (1,270)Accounts payable 3,283 (67)Inventory (639) - --------- --------- 92 (1,337) --------- --------- Supplemental disclosure of non-cash transactions:Exercise of share options - Transfer from contributedsurplus to share capital (1,375) (117)Vesting of restricted share units (435) - 12. Commitments As at 30 June 2006, the Company had remaining spending commitments of $1,345(2005 - $1,490) over the remaining term of its Voia exploration licence inRomania which expires in March 2007. The Company has spending commitments of $187 per year (plus service charges andvalue added tax) for a term of ten years under the lease for its office inLondon, England, which commenced in April 2004. The rent will be reviewed on thefifth anniversary of the commencement of the term to reflect any increase inrents in the market. In November 2005, Hellas Gold entered into off-take agreements pursuant to whichHellas Gold agreed to sell the following quantities of metal concentratesproduced at the Stratoni mine during the financial years ending 31 December2006, 2007 and 2008: 2006 2007 2008 (dry metric tonnes (dmt)) --------- --------- Zinc concentrates 42,700 51,000 15,000Lead/silver concentrates 25,000 26,000 20,000 --------- --------- --------- 67,700 77,000 35,000 --------- --------- --------- As at 30 June 2006, 10,796 dmt of zinc concentrates and 6,959 dmt of lead/silverconcentrates had been sold on account of the 2006 commitments. 13. Transactions with related parties During the six-month period ended 30 June 2006, Hellas Gold incurred costs of$8,303 (2005 - $4,307) for management, technical and engineering servicesreceived from a related party, Aktor S.A., a 35% shareholder in Hellas Gold. Asat 30 June 2006, Hellas Gold had accounts payable of $4,195 (2005 - $1,985) toAktor S.A. These expenses were contracted in the normal course of operations andare recorded at the exchange amount agreed by the parties. 14. Segmented information The Company has one operating segment: the acquisition, exploration anddevelopment of precious and base metal mineral resources properties located inGreece and Romania. Geographic segmentation of plant and equipment and deferred exploration anddevelopment costs and operating liabilities is as follows: 30 June 31 December 2006 2005 $ $ --------- ---------RevenueCanada - -Greece 17,357 1,521Romania - -United Kingdom - - --------- --------- 17,357 1,521 --------- --------- Plant and equipment and deferred exploration anddevelopment costsCanada -Greece 209,583 191,659Romania 30,300 28,081United Kingdom 364 344 --------- --------- 240,247 220,084 --------- --------- Operating liabilitiesCanada 137 214Greece 6,526 3,144Romania 144 310United Kingdom 464 320 --------- --------- 7,271 3,988 --------- --------- 15. Reconciliation to International Accounting Standards ("IAS") These financial statements have been prepared in accordance with Canadian GAAP. For Canadian GAAP, the Company has accounted for its investment in Hellas Goldfrom the parent entity perspective which, focuses on the parent entityshareholders and their interests in the subsidiary. For International FinancialReporting purposes, the Company would account for its investment in Hellas Goldfrom the economic entity perspective which views both the controlling andnon-controlling shareholders as equity holders in a consolidated entity thatshould be viewed as, and accounted for, as a whole. The effect of the differences between Canadian GAAP and IAS on the Company'sconsolidated balance sheets and statements of equity is summarised as follows: 30 June 31 December 2006 2005 $ $ --------- ---------Non current assetsGreek mineral properties under Canadian GAAP 188,094 172,867Adjustment for IAS 94,194 88,234 --------- ---------Greek mineral properties under IAS 282,288 261,101 --------- --------- Non current liabilitiesNon current liabilities under Canadian GAAP 69,018 62,807Adjustment to future tax 23,478 22,069Adjustment for non-controlling interest (16,241) (14,239) --------- ---------Non current liabilities under IAS 76,255 70,637 --------- --------- Shareholders' equityShareholders' equity under Canadian GAAP 215,947 199,823Adjustment to cumulative translation adjustment account 13,937 (26,388)Non-controlling interest under IAS 79,260 72,706Additional depletion 371 41 --------- ---------Shareholders' equity under IAS 309,515 246,182 --------- --------- Other than the differences noted above, management considers that there are nomaterial differences between amounts reported under Canadian GAAP and those thatwould result from the application of IAS. 16. Reclassification of comparative figures Certain comparative figures have been reclassified to conform to the currentyear's presentation. 17. Legal proceedings The Company, from time to time, is involved in various claims, legal proceedingsand complaints arising in the ordinary course of business. There are no legalproceedings to which the Company or any of its subsidiaries is a party or ofwhich any of their properties is the subject that would have a material adverseeffect on the consolidated financial condition or future results of the Company.There are no such proceedings known to the Company to be contemplated. 18. Post balance sheet event Since 30 June 2006, the Company granted 330,000 restricted share units under theCompany's Restricted Share Unit Plan. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
EGU.L