22nd Sep 2008 07:00
Carnegie
Minerals Plc
FOR IMMEDIATE RELEASE 22 SEPTEMBER 2008
CARNEGIE MINERALS PLC
("Carnegie" or the "Company" and its subsidiaries together "the Group")
INTERIM RESULTS
For the period ended 30 June 2008
Carnegie Minerals Plc (AIM: CME), the AIM listed resource company, announces its interim results for the period ended 30 June 2008.
HIGHLIGHTS
Senegal (50% contributing JV with Astron Ltd)
An Environmental Impact Study has been commissioned for the Niafarang Deposit where the JORC-compliant Indicated Resource was estimated in 2007.
Laboratory assaying of samples obtained during the 2007 drilling programme in southern Senegal confirmed intersections of some new mineralisation zones with a number of exploration targets remaining untested.
USA
A broad reaching review of some mineral sands and iron ore projects was undertaken on the ground with a number of good potential opportunities being identified.
Gambia (50% free carried JV with Astron Ltd)
The expropriation of the joint venture assets and wrongful cancellation of the JV company's mining licence by the Gambian Government saw an end to operations in The Gambia during the period. Legal redress is being followed up by the joint venture parties.
Other
Investigations into bulk commodity prospects in Indonesia were terminated after preliminary investigations.
FINANCIAL HIGHLIGHTS
The Company incurred a loss for the period of £ 953,432, which included, in addition to recurring operating expenses, initial costs of our USA project review and significant expenditure on defending the joint venture Gambian interests.
With the expected emerging cash flows from The Gambia lost as a result of the expropriation, combined with the costs of seeking remedies to this action, the Group's modest cash levels have reduced to critical levels with world equity markets providing a significant constraint to further fundraising. The ongoing survival of the Group is now dependent on its stakeholders' support for a successful equity raising.
The Company is actively seeking third party financiers to assist the Group moving forward especially in conjunction with the identification of a suitable project.
Alan Hopkins Managing Director said:
"The Group has been placed in a critical position as a result of The Gambian Government expropriating the joint venture company's operations shortly after they were brought into production. The board has taken all steps to reduce costs to the minimum while seeking financial support from its stakeholders to enable it to continue with its planned operations elsewhere."
CHAIRMAN AND CHIEF EXECUTIVE'S REPORT
On behalf of the Board we provide this interim report for the Company and its subsidiaries (together the "Group"), for the six months ended 30 June 2008.
Financial Review
During the period to 30 June 2008, the Group recorded a loss of £953,432 (2007: £420,507).
The most significant element of the loss was the unforeseen expenditure on defending the position of the joint venture company and its employee, Charlie Northfield, following the wrongful cancellation of the JV company's Gambian mining licence and the arrest of Mr Northfield. At the point of cancellation, the project was approaching full production and a substantial stock of heavy mineral concentrate was ready for sale.
All costs associated with the review of our USA project have been written off as incurred.
During the period, the company placed 28 million new ordinary shares, raising £979,000 after costs.
Cash at bank as at 30 June 2008 was £339,000.
Operational Review
Senegal (50% contributing JV with Astron Ltd)
During the period, the Group commissioned an Environmental Impact Study on the Niafarang Deposit in Southern Senegal (just south of the Gambian border) after having earlier obtained a JORC-compliant independent estimate for an Indicated Resource for this deposit. It is planned to apply to convert this part of the exploration area to a mining title.
In addition to the evaluation of the Niafarang Deposit, the Group had earlier completed exploration drill testing over some priority targets identified by the airborne geophysical survey and the laboratory results of the drill samples confirmed intersections of some new zones of mineralisation. There remain a number of exploration targets that have yet to be tested.
USA
The technical team undertook several field investigations following up opportunities arising from its co-operation agreement with The US Geological Survey. These field trips included the taking of preliminary samples from several areas with some promising results.
If appropriate funding support for this initiative can be obtained, follow up in this area is expected to become the focus for future endeavours of the Group.
Outlook
The expropriation of the emerging mining project in The Gambia was financially devastating to our small Group especially coming at a time of equity markets significantly contracting due to the world wide credit crunch. The board recognises the extent of the very significant challenges that it is grappling with, but is taking all steps to cut costs while seeking the necessary support to allow the Group to continue to follow up its potential. We thank you for your support during this extremely challenging time.
Timothy S Jones Alan G Hopkins
Chairman Managing Director
END
For further information please contact:
Alan G. Hopkins (Carnegie Minerals Managing Director) [email protected]
Olly Cairns (Blue Oar Securities Plc) T: +61 (0) 8 6430 1631
The Carnegie Minerals Website is www.carnegiemins.com
Consolidated Income Statement for the period ended 30 June 2008
|
Note |
Unaudited |
Unaudited |
Audited |
|
|
period ended |
period ended |
year ended |
||
|
30 June 2008 |
30 June 2007 |
31 December 2007 |
||
|
£ |
£ |
£ |
||
|
Revenue - management fees |
5,617 |
7,822 |
81,606 |
|
|
Administrative expenses |
(969,786) |
(498,440) |
(1,270,126) |
|
|
Operating Loss |
(964,169) |
(490,618) |
(1,188,520) |
|
|
Share of profit/(loss) in joint venture |
- |
47,928 |
(598,719) |
|
|
Interest income |
10,737 |
22,183 |
34,016 |
|
|
Loss before taxation |
(953,432) |
(420,507) |
(1,753,223) |
|
|
Tax expense |
- |
- |
- |
|
|
Loss for the period attributable to equity holders of the parent entity |
(953,432) |
(420,507) |
(1,753,223) |
|
|
Loss per share attributable to equity holders of the parent entity Basic and diluted |
2 |
(1.219)p |
(0.765)p |
(3.188)p |
Consolidated Statement of Recognised Income and Expense for the period ended 30 June 2008
|
Unaudited |
Unaudited |
Audited |
|
|
period ended |
period ended |
year ended |
|
|
30 June 2008 |
30 June 2007 |
31 December 2007 |
|
|
|
£ |
£ |
£ |
|
Loss for the period |
(953,432) |
(420,507) |
(1,753,223) |
|
Foreign exchange gain/(loss) on retranslation of overseas operations |
62,252 |
6,972 |
(60,533) |
|
Total recognised income and expense for the period |
(891,180) |
(413,535) |
(1,813,756) |
|
Attributable to: |
|||
|
Equity holders of the parent |
(891,180) |
(413,535) |
(1,813,756) |
Consolidated Balance Sheet at 30 June 2008
|
|
|
Unaudited
|
Unaudited
|
Audited
|
|
|
|
30 June 2008
|
30 June 2007
|
31 December 2007
|
|
|
|
£
|
£
|
£
|
|
Assets
|
|
|
|
|
|
Non-current assets
|
|
|
|
|
|
Intangible assets
|
|
488,997
|
448,288
|
474,991
|
|
Property, plant and equipment
|
|
79,947
|
80,594
|
78,603
|
|
Interests in joint ventures
|
|
-
|
766,263
|
-
|
|
|
|
568,944
|
1,295,145
|
553,594
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
Debtors
|
|
61,578
|
35,213
|
21,024
|
|
Cash at bank and in hand
|
|
339,119
|
771,009
|
215,737
|
|
|
|
400,697
|
806,222
|
236,761
|
|
|
|
|
|
|
|
Total assets
|
|
969,641
|
2,101,367
|
790,355
|
|
|
|
|
|
|
|
Liabilities
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
Trade and other payables
|
|
(238,244)
|
(76,035)
|
(146,672)
|
|
|
|
|
|
|
|
Total liabilities
|
|
(238,244)
|
(76,035)
|
(146,672)
|
|
|
|
|
|
|
|
Net assets
|
|
731,397
|
2,025,332
|
643,683
|
|
|
|
|
|
|
|
Capital and reserves
|
|
|
|
|
|
Called up share capital
|
|
830,000
|
550,000
|
550,000
|
|
Share premium
|
|
1,668,748
|
969,851
|
969,851
|
|
Merger reserve
|
|
839,346
|
839,346
|
839,346
|
|
Foreign exchange reserve
|
|
8,484
|
13,740
|
(53,765)
|
|
Warrant reserve
|
|
250,000
|
250,000
|
250,000
|
|
Retained earnings
|
|
(2,865,181)
|
(597,605)
|
(1,911,749)
|
|
|
|
|
|
|
|
Total equity
|
|
731,397
|
2,025,332
|
643,683
|
|
|
|
|
|
|
Consolidated Cash Flow Statement for the period ended 30 June 2008
|
Unaudited
|
Unaudited |
Audited |
||||
| period ended |
period ended |
year ended |
||||
|
30 June 2008 |
30 June 2007 |
31 December 2007 |
||||
|
£ |
£ |
£ |
||||
|
Net cash flow from operating activities |
||||||
|
Loss for the period |
(953,432) |
(420,507) |
(1,753,223) |
|||
|
Depreciation and amortisation |
8,542 |
3,447 |
13,162 |
|||
|
Share-based payment expense |
- |
74,304 |
92,877 |
|||
|
Share of (loss)/profit of joint venture |
- |
(47,928) |
598,718 |
|||
|
Impairment of goodwill |
26,555 |
- |
168,174 |
|||
|
Capitalised exploration expenses |
(20,826) |
(62,185) |
(138,147) |
|||
|
Interest received |
(10,737) |
(22,183) |
(34,106) |
|||
|
Foreign exchange gains/(losses) |
33,921 |
5,736 |
(68,182) |
|||
|
Movement in working capital: |
||||||
|
- trade and other receivables |
(40,554) |
43,424 |
57,613 |
|||
|
- trade and other payables |
91,572 |
(32,165) |
38,472 |
|||
|
Cash flow from operations |
(864,959) |
(458,057) |
(1,023,850) |
|||
|
Cash flow from investing activities |
||||||
|
Purchase of property, plant and equipment |
(1,293) |
(8,209) |
(10,401) |
|||
|
Disposal of property, plant and equipment |
- |
9,770 |
10,650 |
|||
|
Interest received |
10,737 |
22,183 |
34,016 |
|||
|
Net cash flow from investing activities |
9,444 |
23,744 |
34,265 |
|||
|
Cash flow from financing activities |
||||||
|
Issue of shares |
1,120,000 |
- |
- |
|||
|
Share issue costs |
(141,103) |
- |
- |
|||
|
Net cash flow from financing activities |
978,897 |
- |
- |
|||
|
Net increase/(decrease) in cash and cash equivalents |
123,382 |
(434,313) |
(989,585) |
|||
|
Cash and cash equivalents at beginning of period |
215,737 |
1,205,322 |
1,205,322 |
|||
|
Cash and cash equivalents at end of period |
339,119 |
771,009 |
215,737 |
|||
NOTES TO THE INTERIM RESULTS
1. Accounting policies
Basis of accounting
The interim financial information for the six months ended 30 June 2008 and that for the equivalent period in 2007 has been neither audited nor reviewed by the Group's auditors. The comparatives for the full year ended 31 December 2007 are not the Group's full statutory accounts for that year. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The auditors' report on those accounts was unqualified, did not include references to any matters to which the auditors drew attention by way of emphasis without qualifying their report and did not contain a statement under section 237(2)-(3) of the Companies Act 1985.
The interim financial information has been prepared in accordance with the accounting policies and presentation required by International Financial Reporting Standards, incorporating International Accounting Standards and Interpretations (collectively "IFRS") as endorsed by the European Union.
The interim report is presented and prepared in a form consistent with that which has been adopted in the Group's annual accounts having regard to the accounting standards applicable to such accounts.
2. Loss per share
The calculation of loss per ordinary share is based on a loss of £953,432 (2007: £420,507) and on 78,230,769 (2007: 55,000,000) ordinary shares, being the weighted average number of ordinary shares in issue during the period.
3. Dividends
The directors do not recommend the payment of a dividend.
Related Shares:
BHR.L