19th Mar 2007 07:01
Allied Gold Limited19 March 2007 FOR IMMEDIATE RELEASE 19 March 2007 ALLIED GOLD LIMITED Half Year Financial Report 31 DECEMBER 2006 RESULTS The consolidated loss of the economic entity after providing for income tax is$467,554 (2005: loss $978,517). REVIEW OF OPERATIONS During the period under review there were major advances in the development ofthe Simberi Oxide Gold Project. A detailed project review was completed whichconfirmed the capital cost of the project at $80M for a plant capacity of2.0Mtpa. Gold production is scheduled to commence in the second half of 2007. Construction of the Project commenced in July 2006 and by the end of December2006 much of the accommodation and infrastructure work had been completed. Plantconstruction including site earthworks, foundations for the leach tanks, plantbuildings and the scrubber area had commenced and was approximately 20% completeby the end of December 2006. Expenditure and commitments to the end of December2006 totaled $44.6M. Construction of accommodation blocks progressed well with 4 construction and 3operations blocks completed with the remainder expected to be completed by theend of the third quarter. The messing facilities and construction power supplyhave been completed and are being operated by the catering contractor. Construction of the all weather roads from the processing plant site to themining areas, aerial ropeway loading point and support towers was completed witha very high standard of road being constructed which will enable ore to behauled to the process plant to supplement the aerial ropeway if necessary. The upgrade of the airstrip on Simberi Island to accommodate Dash 8 aircraft wascompleted along with the upgrade of the island ring road which enabled theemployment of Simberi Island inhabitants on the construction project. Wharfconstruction had commenced with pile driving completed and deck constructionunderway. Negotiations with a power provider are progressing well and areexpected to be completed in the short term. The bathymetric survey of the oceanfloor adjacent to Pigiput Bay was completed enabling the completion of the deepsea tailings placement (DSTP) design. Exploration on Simberi and Tatau continued with positive results being achieved.Ore resources were increased by 43,000 ounces to 2.39 million ounces of gold. SUBSEQUENT EVENTS The following events occurred subsequent to 31 December 2006: •Mr John Grant Brock was appointed to the Board of Allied Gold Limited on 25 January 2007. •Mr Anthony Lowrie was appointed to the Board of Allied Gold Limited on 9 March 2007. €2,000,000 options were issued to certain employees of Allied Gold Limited pursuant to the Allied Gold Limited Employee Option Plan as follows: + €1,250,000 options exercisable at $0.50 on or before 31 December 2008 + €750,000 options exercisable at $0.80 on or before 31 December 2008. €8,333 ordinary shares in the Company were issued through the exercise of options. •Allied Gold Limited completed a Tenement Sale Agreement with Carbine Resources Limited for the sale of the Red Dam Project. The consideration for the sale being a deposit of $5,000 cash plus 4,020,000 shares in Carbine Resources Limited. Other than the matters disclosed above and elsewhere in this half year financialreport, there has not arisen in the interval between the end of the financialperiod and the date of this report any item, transaction or event of a materialand unusual nature likely, in the opinion of the Directors of the Company, toaffect significantly the operations of the Company, the results of thoseoperations or the state of affairs of the Company in future financial periods. FUTURE DEVELOPMENTS, PROSPECTS AND BUSINESS STRATEGIES The company is continuing with the full development of the Simberi Oxide GoldProject with a 2.0 mtpa plant currently being constructed with the associatedinfrastructure underway. Mine production is scheduled at 84,000 ounces of goldper annum. Scheduled gold production is due to commence in the third calendarquarter 2007. It is anticipated that an accelerated exploration programme willbe undertaken to convert known resource ounces into reserve ounces. In the opinion of the Directors it may prejudice the interests of the Company toprovide additional information in relation to likely developments in theoperations of the Company and the expected results of those operations insubsequent financial periods. OTHER INFORMATION The registered office and principal place of business is Unit 15, 51-53 KewdaleRoad, Welshpool, Western Australia, 6106 Contact: Mark Caruso, Executive Chairman, Allied Gold Limited + 61 8 9353 3638 Roland Cornish, Beaumont Cornish Limited + 44 207 628 3396 CONDENSED INCOME STATEMENT FOR THE HALF YEAR ENDED 31 DECEMBER 2006 Half Year 2006 2005 Note $ $ Revenue 2 1,354,714 1,036,783 Exploration and evaluation - (29,253) costs Provision for diminution (12,900) - listed shares Increase in fair value of 105,949 - listed shares MMPEU costs, including - (156,448) depreciation Depreciation (362,373) - Share based remuneration 2 - (973,822) General & administration 2 (1,379,801) (855,776) expenses Net foreign exchange losses (173,143) - Loss before income tax (467,554) (978,517) Income tax expense - - Loss after income tax attributable to members of the parent entity (467,554) (978,517) Overall operations Basic earnings per share (0.17) (0.8) (cents) Diluted earnings per share n/a n/a (cents) The above condensed income statement should to be read in conjunction with theaccompanying notes CONDENSED BALANCE SHEET AS AT 31 DECEMBER 2006 Half Year Note Half Year Financial Year ended 31 December 30 June 2006 2006 $ $ CURRENT ASSETS Cash and cash equivalents 33,240,146 55,370,334 Trade and other 89,316 674,138 receivables Other financial assets 465,478 372,429 Other current assets 35,103 77,809 Total Current Assets 33,830,043 56,494,710 NON-CURRENT ASSETS Plant and equipment 3 28,758,775 3,586,280 Exploration and 4 27,629,076 27,769,231 evaluation expenditure Total Non-Current Assets 56,387,851 31,355,511 Total Assets 90,217,894 87,850,221 CURRENT LIABILITIES Trade and other payables 5,577,443 2,858,952 Total Current Liabilities 5,577,443 2,858,952 NON CURRENT LIABILITIES Provisions 23,522 - Total Non-Current 23,522 - Liabilities Total Liabilities 5,600,965 2,858,952 NET ASSETS 84,616,929 84,991,269 EQUITY Issued capital 5 87,743,506 87,802,197 Reserves 1,952,157 1,800,252 Accumulated losses (5,078,734) (4,611,180) TOTAL EQUITY 84,616,929 84,991,269 The above condensed balance sheet should be read in conjunction with theaccompanying notes CONDENSED STATEMENT OF CHANGES IN EQUITY FOR THE HALF YEAR ENDED 31 DECEMBER 2006 Issued Accumulated Share-based Foreign Total Capital Losses Payments Exchange Reserve Translation ReserveECONOMIC ENTITY At 1 July 2005 23,422,127 (2,885,109) - 58,652 20,595,670 Equity issued to 600,000 - 545,205 1,145,205acquire residualinterest in SimberiMining Joint Venture Share placements 518,331 - - - 518,331 Share based payments 973,822 973,822 Conversion of 4,000 - - - 4,000options Cost of equity - - -raising Adjustments from - - - (91,619) (91,619)translation offoreign controlledentities Total income and (91,619) (91,619)expense recognizeddirectly in equity Loss for the period - (978,517) - - (978,517) Total recognised - (978,517) - (91,619) (1,070,136)income and expenseduring the year At 31 December 2005 24,544,458 (3,863,626) 1,519,027 (32,967) 22,166,892 At 1 July 2006 87,802,197 (4,611,180) 1,823,322 (23,070) 84,991,269 Conversion of 10,000 - - - 10,000options Cost of equity (68,691) - - - (68,691)raising Adjustments from - - - 151,905 151,905translation offoreign controlledentities Total income and 151,905 151,905expense recognizeddirectly in equity Loss for the period - (467,554) - - (467,554) Total recognised - (467,554) - - (315,639)income and expenseduring the year At 31 December 2006 87,743,506 (5,078,734) 1,823,322 128,835 84,616,929 The above condensed statement of changes in equity should be read in conjunction with the accompanying notes CONDENSED CASHFLOW STATEMENT FOR THE HALF YEAR ENDED 31 DECEMBER 2006 Note Economic Entity Half Year Half Year ended 31 ended 31 December December 2006 2005 $ $CASH FLOWS FROM OPERATING ACTIVITIESExploration and evaluation (7,950,387) (3,261,447)expenditureInterest received 1,352,072 53,387Interest paid - -Payments to suppliers & (1,379,592) (914,022)employeesNet cash generated from/ (7,977,907) (4,122,082)(used in) operatingactivities CASH FLOWS FROM INVESTING ACTIVITIESPurchase of equity - (50,000)investmentsPurchase of plant & (2,006,865) (558,112)equipmentAssets under construction (12,241,272) -Proceeds from sale of plant - 502,256and equipmentNet cash generated by (used (14,248,137) (105,856)in) investing activities CASH FLOWS FROM FINANCING ACTIVITIESProceeds from the issue of 10,000 522,331securitiesSubscription for equity 160,000securities received pendingallotmentCosts of raising equity (68,691) -capitalNet cash generated by (58,691) 682,331)financing activities Net increase in cash held (22,284,735) (3,545,607)Cash at beginning of the 55,370,334 4,373,904half yearEffects of exchange rate 154,547 -changes on the balance ofcash held in foreigncurrenciesCash at end of the half 33,240,146 828,297year The above condensed statement of cashflow should be read in conjunction with theaccompanying notes. NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2006 1. BASIS OF PREPARATION OF HALF YEAR FINANCIAL STATEMENTS This general purpose financial report for the interim half-year reporting periodended 31 December 2006 has been prepared in accordance with AustralianAccounting Standard 134 "Interim Financial Reporting" and the Corporations Act2001 This interim report does not include all the notes of the type normally in anannual financial report and therefore cannot be expected to provide as full anunderstanding of the financial performance, financial position and financing andinvesting activities of the consolidated entity as the full financial report.Accordingly, this interim financial report is to read in conjunction with theannual report for the year ending 30 June 2006 and any public announcements madeby Allied Gold Limited during the interim reporting period in accordance withthe continuous disclosure requirements of the Corporations Act 2001. The same accounting policies and methods of computation have generally beenfollowed in this interim financial report as compared with the most recentannual financial report and corresponding Interim reporting period Critical Accounting Estimates and Judgments The directors evaluate estimates and judgments incorporated into the financialreport based on historical knowledge and best available current information.Estimates assume a reasonable expectation of future events and are based oncurrent trends and economic data, obtained both externally and within the group. Key Estimates - Impairment The group assesses impairment at each reporting date by evaluating conditionsspecific to the group that may lead to impairment of assets. Where an impairmenttrigger exists, the recoverable amount of the asset is determined. Value-in-usecalculations performed in assessing recoverable amounts incorporate a number ofkey estimates Half Year 2006 2005 $ $ 2. REVENUES AND EXPENSES (a) RevenueInterest revenue- interest other persons 1,352,072 53,387- interest - wholly owned - -controlled entitiesTotal Interest 1,352,072 53,387Unrealised foreign exchange (173,143) 210,149(loss)/gainOther income 27 1,178,929 263,563 (b) Other incomeFair value change on investments held 105,949 -for tradingNet gain on disposal of assets - 773,220Net gain on disposal of investments - - - 773,220 (c) DepreciationPlant and equipment 362,373 - NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2006 Economic Entity 31 Dec 30 June 2006 2006 $ $ 3. PLANT AND EQUIPMENT Plant and equipment - at 29,121,148 3,806,383costAccumulated depreciation (362,373) (220,103)Total property, plant and 28,758,775 3,586,280equipment Reconciliation of the carryingamount of plant and equipment atthe beginning and end of thecurrent and previous financialyear.Plant and equipmentCarrying amount at beginning 3,586,280 1,575,585of yearAcquisition of controlled - -entityAdditions 25,534,868 3,493,584Disposal - (1,125,606)Depreciation (362,373) (357,283)Carrying amount at end of 28,758,775 3,586,280year As at 31 December 2006 there was a further $22,297,924 expenditure commitment onthe Simberi Oxide Gold project. 4. EXPLORATION AND EVALUATION EXPENDITURE Exploration expenditure -costscarried forward in respect ofareas of interest in: Exploration and evaluation 27,769,231 27,629,076phases The ultimate recoupment of suchcosts is dependant on successfuldevelopment and commercialexploitation, or alternativelysale of the exploration areas. Reconciliation of the carryingamount of mining tenements atthe beginning and end of thecurrent and the previousfinancial year: Carrying amount at beginning 27,769,231 15,616,266of yearExpenditure outlaid in cash 7,950,387 12,097,666and accruedExpenditure reclassified to (8,245,088)assets under constructionForeign currency translation 154,546 84,786Write off discontinued - (29,487)projectsCarrying amount at end of year 27,629,076 27,769,231 NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2006 5 ISSUED CAPITAL Half year Year ended Half year Year ended ended 31 30 June ended 31 30 June December 2006 December 2006 2006 2006 Number of Number of $ $ shares shares(a) Ordinary shares fullypaidBalance at beginning of 272,022,528 120,579,818 87,802,197 23,422,127financial yearIssue of shares to Simberi - 2,000,000 600,000Gold CorpPlacement December 2005 at 40 - 1,295,828 - 518,331centsPlacement January 2006 at 40 - 23,704,172 - 9,481,669centsPlacement February 2006 at 44 - 15,192,027 - 6,684,492centsPlacement April 2006 at 44 - 79,545,455 - 35,000,000centsPlacement May 2006 at 60 - 21,800,000 - 13,080,000centsConversion of options during 7,905,228 2,381,100year ended 30 June 2006Conversion of options during 40,000 10,000the half year ended 31December 2006Costs of capital raising - - (68,691) (3,365,522)Balance at end of financial 272,062,528 272,022,528 87,743,506 87,802,197year Fully paid ordinary shares entitle the holder to participate in dividends and toone vote per share. (b) Options Options granted and exercised during the period, and on issue at balance dateare as follows. Date and details of grant / No. of Options Exercise Expiry Date exercise Price Opening balance 30,112,183 Various Various Options exercised in the (40,000) $0.20 period Balance at 31 December 2006 30,072,183 6 CONTINGENT LIABILITIES There are no contingent liabilities. NOTES TO THE CONDENSED FINANCIAL STATEMENTS FOR THE HALF YEAR ENDED 31 DECEMBER 2006 7 SUBSEQUENT EVENTS The following events occurred subsequent to 31 December 2006: •Mr John Grant Brock was appointed to the Board of Allied Gold Limited on 25 January 2007. •Mr Anthony Lowrie was appointed to the Board of Allied Gold Limited on 9 March 2007. €2,000,000 options were issued to certain employees of Allied Gold Limited pursuant to the Allied Gold Limited Employee Option Plan as follows: + €1,250,000 options exercisable at $0.50 on or before 31 December 2008 + €750,000 options exercisable at $0.80 on or before 31 December 2008. €8,333 ordinary shares in the Company were issued through the exercise of options. •Allied Gold Limited completed a Tenement Sale Agreement with Carbine Resources Limited for the sale of the Red Dam project. The consideration for the sale being a deposit of $5,000 cash plus 4,020,000 shares in Carbine Resources Limited. Other than the matters disclosed above and elsewhere in this half year financialreport, there has not arisen in the interval between the end of the financialperiod and the date of this report any item, transaction or event of a materialand unusual nature likely, in the opinion of the Directors of the Company, toaffect significantly the operations of the Company, the results of thoseoperations or the state of affairs of the Company in future financial periods. 8. SEGMENT REPORTING Geographical segments The consolidated entity has the following two geographical segments • Australia • Papua New Guinea (a) Geographical Australia Papua New Guinea Consolidated 31 Dec 31 Dec 31 Dec 2006 31 Dec 31 Dec 31 Dec 2006 2005 2005 2006 2005 $ $ $ $ $ $RevenueTotal segment 1,352,072 1,036,783 2,642 210,149 1,354,714 2,265,819revenue ResultSegment result 555,501 (653,202) (1,023,055) (355,315) (467,554) (978,517)Income Tax - - - - Loss from ordinary activities after tax 555,501 (653,202) (1,023,055) (355,315) (467,554) (978,517) This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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