5th Feb 2007 07:01
Randgold Resources Ld05 February 2007 RANDGOLD RESOURCES LIMITEDIncorporated in Jersey, Channel IslandsReg. No. 62686LSE Trading Symbol: RRSNasdaq Trading Symbol: GOLD RANDGOLD RESOURCES POSTS 54% INCREASE IN PROFIT BEFORE TAX, DECLARES DIVIDEND London, 5 February 2007 - LSE and Nasdaq listed gold miner Randgold Resourcestoday reported a 54% increase to US$74 million in profit before tax for the 12months to 31 December 2006, fuelled by the first full-year contribution from itsLoulo operation in Mali and a higher gold price. Net profit was up 6% at US$51 million against 2005's restated figure. This wasin spite of a tax charge of US$23.1 million, the company's share of its Morilajoint venture's first full year of corporate taxation. Earnings per share were70 cents. Attributable production rose for the third successive year from 314831 ounces in 2005 to 399 927 ounces (448 242 ounces assuming 100% of Louloproduction). Total cash costs for the year averaged US$296 per ounce, up from2005's US$201, mainly due to the lower grade, but were still well below theindustry average of US$350. The company ended the year with cash of US$143 million after expenditure ofUS$29 million on exploration and corporate costs, US$32 million on thecompletion of the Loulo plant and additions, US$18 million on the Yaleaunderground development and another US$19 million on repaying the first third ofthe Loulo project finance. In view of the strong cash flows from operations and the company's robustbalance sheet, the board decided to declare a dividend of 10 cents per share,totalling a pay-out of US$6.9 million. Chief executive Mark Bristow said the initiation of dividend payments was amajor milestone in the development of Randgold Resources as a profitablebusiness. Loulo finished the year with an excellent quarter, increasing production by 20%from the previous quarter's level on the back of continued operationalimprovements. Despite delays caused by the late commissioning of the hard rockcrushing circuit, production for the year was only marginally below target at241 575 ounces. The higher average gold price received of US$601 per ounce waspartly offset by the effect of delivering 66 922 ounces into the hedge at US$434per ounce. Profit from mining activity for the first full year of productionwas US$57.5 million and net profit was US$16.2 million. "All in all, it's been a very satisfactory year for Loulo, thanks to outstandingperformances by our capital and operational teams. The operation has settleddown to a solid state and the focus now is on achieving further efficiencies andimproving cost control," Bristow said. Production at Loulo is scheduled toexceed 250 000 ounces in 2007 from its two open-pit mines. In the meantime, the development of the Yalea underground mine at Loulo isprogressing rapidly. Construction of the boxcut is almost complete and declinedevelopment started with the first blast into hard rock on 22 December lastyear. First ore is expected to be accessed towards the end of this year, withfull production scheduled for 2009. Development of Gara, Loulo's secondunderground mine, is due to start at the beginning of 2009 with first oredelivered to the plant by the end of that year. The recently completed redesignof Gara has doubled its reserve. The two underground mines are expected to notonly extend Loulo's life but to boost its annual production to more than 400 000ounces by 2011. Elsewhere in Mali, Morila produced 516 667 ounces for the year, below 2005'slevel as a result of lower grades, but in line with expectations. After someoperational problems in the second and third quarters, a record throughput wasachieved in October and the plant is currently operating at its full expandedcapacity. Morila is slated to produce around the 500 000 ounce level again in2007. Morila has no debt and no hedging. In Cote d'Ivoire, a 30 000 metre drilling programme which will form the basisfor a feasibility study on the development of a mine is underway at thecompany's 3 million ounce Tongon project. On the exploration front, Randgold Resources now has 128 targets on 20 414km(2)in six countries in West and East Africa. In addition to the work being done atLoulo and Tongon, the company plans to drill advanced targets in Burkina Faso,Senegal and Tanzania. It has recently also established a generative team toassess the countries in which the company does not already have a presence witha view to identifying opportunities there. "The substantial profit and production increases of the past year reflect thecontinuing success of our organic growth strategy. With two established androbust operations, one underground mine in development and another waiting inthe wings, a feasibility stage project at Tongon and a pipeline of qualityprospects, we are strongly placed to sustain our business in 2007 and beyond,"Bristow said. "In the year ahead we'll be looking to extract the maximum benefit from Louloand Morila while progressing the Yalea underground development and advancing ourother projects and prospects. We'll also be keeping a close eye on costs.Pressures produced by the weak dollar, high oil and steel prices and risingcontract mining costs are currently being felt throughout the industry. As faras Randgold Resources in particular is concerned, our mines are in remote areasand have to generate their own power from diesel-fired generators, and the risein the diesel price means that this now accounts for 25% of our total productioncosts. Keeping these costs under control through improved efficiencies, goodhousekeeping and tight management will therefore be a key focus for 2007." RANDGOLD RESOURCES ENQUIRIES:Chief Executive - Dr Mark Bristow, +44 779 775 2288, +223 675 0122Financial Director - Roger Williams, +44 791 709 8939, +223 675 0109Investor & Media Relations - Kathy du Plessis, +27 11 728 4701, Fax: +27 11 728 2547, Cell: +27 83 266 5847, Email: [email protected] Website: www.randgoldresources.com ------------------------------------------------------------------ REPORT FOR THE QUARTER AND YEAR ENDED 31 DECEMBER 2006 * Profit before tax up 54% year on year* Net profit up at US$51m despite first year full tax charge of US$23m* Loulo mine delivers robust results with an increase in gold production and starts Yalea underground development* Mine redesign doubles Gara underground reserves* Morila weighs in with another solid contribution for the year but down on the quarter and year on year production* Tongon moves to bankable feasibility on the back of an aggressive drilling programme* Exploration adds ounces in Mali and produces results out of Burkina Faso* Board declares dividend SUMMARISED FINANCIAL INFORMATION Unaudited Unaudited Unaudited quarter quarter quarter ended ended ended 31 Dec 31 Dec 30 Sept 2005US$000 2006 2006 Restated)+Gold sales# 68 857 63 178 60 553Total cash costs* 38 125 32 504 29 820+Profit from mining activity* 30 732 30 674 30 733+Profit before income tax 15 763 18 302 17 179+Net profit 10 790 12 746 17 009+Net profit (as previously reported) n/a n/a 12 426Net profit attributableto equity shareholders 9 980 12 285 14 660+Net cash generated from operations 8 645 17 818 13 486Cash and cash equivalents 143 356 155 320 152 452Attributable production(S) 116 821 107 002 126 404Group total cash costsper ounce*(S) (US$) 326 304 236+Group cash operatingcosts per ounce*(S) (US$) 288 265 204+ SUMMARISED FINANCIAL INFORMATION (cont'd) Unaudited Unaudited 12 months 12 months ended ended 31 Dec 31 Dec 2005US$000 2006 (Restated)+Gold sales# 262 717 151 502Total cash costs* 132 540 65 939+Profit from mining activity* 130 177 85 563+Profit before income tax 73 973 48 026+Net profit 50 876 47 856+Net profit (as previously reported) n/a 40 887Net profit attributable to equity shareholders 47 564 45 507+Net cash generated from operations 70 410 29 736Cash and cash Equivalents 143 356 152 452Attributable production(S) 448 242 328 428Group total cash costs per ounce*(S) (US$) 296 201+Group cash operating costs per ounce*(S) (US$) 258 169+ # Gold sales does not include the non-cash profit/(loss) on the roll forward of hedges.* Refer to explanation of non-GAAP measures provided.(S) Randgold Resources consolidates 100% of Loulo and 40% of Morila.+ Restated due to change in accounting policy relating to deferred stripping. See note on accounting policies.n/a Not applicable. COMMENTS The figures for the year reflect the successful progression of the company'sgrowth strategy. Profit before tax was up from US$48 million to US$74 millionfor the year. This was the first full year of corporate tax at Morila and thegroup incurred an income tax charge of US$23.1 million for the year (2005:US$0.2 million). The tax charge was however offset by the increased profit frommining activity. Net profit for the year of US$50.9 million was up by 6% whencompared to the prior year (restated). The main factors in the improved profitwere the first full year of production at Loulo and higher gold prices. Theseelements were partially offset by lower grades resulting in lower production atMorila and increased costs, as has been experienced by most of the industry thisyear. Gold prices averaged US$604/oz compared to US$445/oz in 2005.Attributable production (taking 80% of Loulo) was up for the third successiveyear at 399 927 ounces in 2006, (448 242 million ounces assuming 100% of Louloproduction) compared to 314 831 ounces in 2005 and 204 194 ounces in 2004.Earnings per share of 70 cents is in line with the 74 cents of 2005 (restated)and up on 32 cents in 2004. Cash operating costs for the group were US$258/oz up from US$169/oz in 2005(restated). After royalties, total cash costs for the group were US$296/oz forthe year compared to US$201/oz in 2005 (restated). This compares to an averagefor the industry which is now over US$350/oz. Industry wide cost pressures havecontinued this year resulting from the weak dollar, high diesel and steel pricesand contract mining costs. The company's mines are in particularly remotelocations and the mines produce power from diesel fired generators. This, withthe diesel required for the mining fleet, meant that diesel comprised 25% of theproduction costs in the year. Contract mining costs make up over 30% ofproduction costs and have also experienced inflationary pressures as demand formining equipment has led to a supply deficit which has pushed up costs. Despitethese cost pressures, costs have been well controlled at both locations and thelower grade processed is the main factor in the increased cost per ounce.Grades have decreased from 5.9g/t in 2005 at Morila to 4.2g/t this year, and atLoulo from 4.5g/t to 3.2g/t as per the respective Life of Mine plans. Expenditure on exploration and corporate costs continues to be an importantinvestment with US$29 million being spent in the year compared to last year'sUS$24 million. Extensive drilling programmes were undertaken in all countriesin which we operate except for Ghana. The company's cash position remains very healthy with U$143 million cash on thebalance sheet and debt of US$53 million. Net funds have improved from last yeardespite the significant expenditure on exploration and corporate costs, US$31.7million being spent on completion of the Loulo capital project, US$28.8 millionon exploration and corporate costs and US$17.6 million being spent onunderground equipment and the commencement of the decline shaft sinking atLoulo. US$19.2 million of the US$60 million project financing was paid backduring the year. The board has declared a dividend for the 2006 year of US$6.9 million or 10cents per share. A separate announcement is being issued simultaneously withthese results. The results for the fourth quarter of 2006 were impacted by a number of items:Loulo finished the year with an excellent quarter increasing production by 20%compared to the previous quarter, mainly due to operational improvements. Thiswas partially offset by lower production due to lower grades from Morila. Total cash costs were impacted by a provision of US$1.3 million against slowmoving Loulo and Morila debtors relating to reimbursable indirect taxes whichhave been discounted to reflect the expected settlement dates. These provisionsincreased total cash costs for the group by US$11/oz for the quarter. Cash costs were reduced at Loulo from US$350/oz during the previous quarter toUS$326/oz during the final quarter due to the productivity improvements and thehigher grade which was 3.7g/t up from 3.2g/t. At Morila, cash costs were up from US$251/oz to US$327/oz due to lower gradesand the year end provisions for slow-moving debts which have been discountedthat amounted to US$23/oz. OPERATIONSLouloDespite the delays caused by the late commissioning of the hard rock crushingcircuit throughput was maintained at levels above the design specification.This resulted in production of 241 575 ounces for the year, only marginallybelow expectations, mainly as a result of not being in a position to feed asmuch of the originally planned higher grade harder ore stream. The higher average spot gold price received of US$601 offset by the effect ofdelivering 66 922 ounces into the hedge at an average US$434 per ounce resultedin revenue of US$136.8 million for the year. Cash operating costs of US$294/ozfor the year are up from the previous year which reflected only two months ofoxide operations. This resulted in profit from mining of US$57.5 million forthe first full year of operation at Loulo and a net profit of US$16.2 millionafter deducting depreciation, financing costs and exploration. The Loulo operation has settled down to a steady state during the year and thefocus in 2007 will be on the optimisation of the process and improving costcontrol given the cost pressures impacting the industry particularly withrespect to grinding media, reagents and power generation consumables. The mining contractor moved a total of 18.4 million tonnes at a strip ratio of6.2:1 waste to ore during the year after problems with loading equipment wereattended to in the last six months of the year. As part of an exercise tocurtail the effect of rising contractor costs, all rise and fall formulae willbe reviewed to ensure that these only take into account inflationary amounts andnot contractor inefficiencies. Production statistics are:Loulo results Quarter Quarter Quarter ended ended ended 31 Dec 30 Sept 31 Dec 2006 2006 2005MiningTonnes mined (000) 4 953 4 830 4 149Ore tonnes mined (000) 610 784 537MillingTonnes processed (000) 655 588 551Head grade milled (g/t) 3.7 3.2 4.5Recovery (%) 95.2 95.2 94.3Ounces produced 68 501 57 123 67 984Average price received (US$/oz) 546 548 499Cash operating costs*(US$/oz) 293 317 137Total cash costs* (US$/oz) 326 350 165Profit from mining activity(US$000)* 15 268 11 125 19 485Gold sales*+ 37 592 31 110 30 688 Loulo results (cont'd) 12 months 12 months ended ended 31 Dec 31 Dec 2006 2005MiningTonnes mined (000) 18 362 12 096Ore tonnes mined (000) 2 547 1 213MillingTonnes processed (000) 2 595 551Head grade milled (g/t) 3.2 4.5Recovery (%) 93.9 94.3Ounces produced 241 575 67 984Average price received (US$/oz) 556 499Cash operating costs*(US$/oz) 294 137Total cash costs* (US$/oz) 328 165Profit from mining activity (US$000)* 57 534 19 485Gold sales*+ 136 765 30 688 Randgold Resources owns 80% of Loulo with the Government of Mali owning 20%.The Government's share is not a free carried interest. Randgold Resources hasfunded the Government portion of the investment in Loulo by way of shareholderloans and therefore controls 100% of the cash flows from Loulo until theshareholder loans are repaid.Randgold Resources consolidates 100% of Loulo and then shows the minorityinterest separately. * Refer to explanation of non-GAAP measures provided. + Includes the impact of 27 158 ounces delivered into the hedge at US$434/oz for the quarter ended 31 December 2006 and 66 922 ounces at US$434/oz for the year ended 31 December 2006. MorilaMorila produced 516 667 ounces of gold for the year, below 2005's production asexpected as a result of moving to lower grade areas of the pit. Miningproduction dropped in the second half of the year as a result of poor fleetavailability but remedial action had been put in place by the year end. Plantmonthly throughput in the second and third quarters slipped to levels belowdesign capacity but production levels have now been restored and in the Octobermonth a record throughput of 372 463 tonnes was achieved and the plant is nowoperating at full expanded capacity. Costs were reasonably well contained given prevailing increases in input costs.Cash operating costs, before adjusting for exceptional costs relating toprovisions on indirect taxes, were US$215/oz up from last year's costs of US$178/oz (restated). Total cash costs were US$327/oz for the quarter and US$258/ozfor the year after the adjustments discussed above. Morila results Quarter Quarter Quarter ended ended ended 31 Dec 31 Dec 30 Sept 2005 2006 2006 (Restated)+MiningTonnes mined (000) 4 585 4 862 6 798Ore tonnes mined (000) 911 1 261 2 199MillingTonnes processed (000) 1 086 1 007 946Head grade milled (g/t) 3.7 4.2 5.2Recovery (%) 92.5 90.8 90.8Ounces produced 120 801 124 698 146 049Average price received (US$/oz) 623 622 485Cash operating costs* (US$/oz) 282 206 282+Total cash costs* (US$/oz) 327 251 319+Profit from mining activity(US$000)*38 660 48 872 28 120+Attributable (40% proportionatelyconsolidated)Gold sales 31 265 32 068 29 865Ounces produced 48 320 49 879 58 420Profit from mining activity(US$000)*15 464 19 549 11 248+ Morila results (cont'd) 12 months 12 months ended ended 31 Dec 31 Dec 2006 2005MiningTonnes mined (000) 21 512 24 554Ore tonnes mined (000) 5 242 7 041MillingTonnes processed (000) 4 138 3 763Head grade milled (g/t) 4.2 5.9Recovery (%) 91.9 91.7Ounces produced 516 667 651 110Average price received (US$/oz) 609 449Cash operating costs* (US$/oz) 215 178+Total cash costs* (US$/oz) 258 210+Profit from mining activity (US$000)* 181 607 165 195+Attributable (40% proportionately consolidated)Gold sales 125 952 120 814Ounces produced 206 667 260 444Profit from mining activity (US$000)* 72 643 66 078+ * Refer to explanation of non-GAAP measures provided. + Restated due to change in accounting policy related to deferred stripping. See note on accounting policies. The resource base for Morila as at end 2006 is tabulated below with a comparisonto figures as at end 2005. After resource depletion as a result of miningactivities during the year, remaining resources are less than last year's as aresult of changes to the orebody model. An updated reserve statement will be published as part of the group's annualresource/reserve tabulation at the end of the first quarter of 2007. Morila Resources - 31 December 2006Measured, indicated and inferred mineral resources Tonnes Tonnes Grade (Mt) (Mt) (g/t) Category 2006 2005 2006 Measured 20.54 20.06 3.44 Indicated 9.50 14.01 3.34Sub-total Measured and Indicated 30.04 34.07 3.41 Inferred 3.09 3.78 3.31 (cont'd) Attribut- able Grade Gold Gold gold (g/t) (Mozs) (Mozs) (Mozs) Category 2005 2006 2005 (40%) Measured 2.73 1.50 1.76 Indicated 3.00 1.02 1.35Sub-total Measured and Indicated 2.84 2.52 3.11 1.01 Inferred 3.19 0.33 0.39 0.13 PROJECTS AND EVALUATIONLOULO UNDERGROUND DEVELOPMENT PROJECTYaleaExcavation and construction of the boxcut for the Yalea underground developmentmade good progress during the quarter. The inauguration ceremony for the Yaleaunderground mine was held on 17 October 2006. Bedrock was exposed duringNovember and the first blast into solid rock initiated the twin declinedevelopment on 22 December. Most of the underground heavy vehicle fleet equipment has been delivered tosite. A maintenance agreement was reached with Manutention Africaine (the localCaterpillar dealership) for a service contract for 2007. GaraDuring the quarter, the proposed mine was redesigned and a mining schedule wasprepared for the Gara underground mine based on the increase of resources by 800000 ounces. The latest resource totals 25 million tonnes at 4.11g/t for 3.3million ounces. The redesign for Gara has been based on the Yalea design with a production rateincrease to 100 000 tonnes per month (previously 60 000 tonnes per month). A twin ramp system, developed from the open pit instead of a boxcut, one towardsthe north and the other towards the south, will divide the underground mine intwo separate mining and ventilation districts. A conveyor belt system will beused to transport ore and waste out of the mine rather than the conventionaltruck transport and waste passes will be developed from inside the pit tofacilitate backfill. Based on the enlarged resource and this re-design, the total underground orereserve for Gara now amounts to 11.12Mt at a grade of 3.87g/t for total gold of1.38 million ounces an increase of 720 000 ounces over the previous reserve. Itis currently expected that the development of the Gara underground mine willcommence early in 2009 with first ore delivered to the plant at the end of 2009. TONGON PROJECTThe team is progressing with the implementation of a 30 000 metre drillingprogramme at the Tongon project which will form the basis for a feasibilitystudy on the development of the mine. A further suite of metallurgical samplinghas been scheduled in order to better characterise the ore and develop thedetailed flow sheet and plant design required for the bankable feasibilitystudy. EXPLORATION ACTIVITIESThe quarter brought to an end a very busy and fruitful year in exploration,which resulted in a continual addition of resources at Loulo, reactivation offield activities in the Cote d'Ivoire on the 3 million ounce Tongon project, apromising target in Burkina Faso and a pipeline of exploration targets acrosssix African countries. At Loulo, reconnaissance drilling at the Gara deposit, up to 400 metres south ofthe current wireframe, has confirmed gold mineralisation associated with a blindantiformal fold closure. L0CP117: 5.80 metres at 3.18g/t from 333 metres;L0CP118: 4.76 metres at 0.64g/t from 409 metres and 6.15 metres at 1.39g/t(including 1.20 metres at 3.70g/t) from 459 metres. Also on the Loulo mining permit, Faraba is part of a 10 kilometre anomalousstructural corridor at surface. Drilling has so far tested a 3 kilometre strikeand identified two mineralised pods; a main zone of 360 metres long with anaverage thickness of 43 metres and an average grade of 2.6g/t to vertical depthsof between 100 and 200 metres below the surface. An inferred resource of 6.8million tonnes at a grade of 2.6g/t for 567 000 ounces has been outlined. Thenorthern zone is 600 metres long, 12 metres wide and an average grade of 2.2g/t.Drilling is planned in 2007 to further test the north and main zones togetherwith an evaluation of the 10 kilometre corridor where an additional 14 dilationzones have been mapped. During December, a 23 hole, 2 368 metre RC drilling programme was completed overa strike length of 1.3 kilometres at Baboto South, in the north of the Loulopermit. Gold mineralisation is associated with both massive and disseminatedpyrite and is hosted in silica/carbonate altered sandstones between hangingwalland footwall shears. The results delineated mineralisation over the strikelength, with an average width of 15 metres and grade of 1.8g/t to verticaldepths of 95 metres. The Baboto structure is part of a large plus 5 kilometre mineralised structurewhich hosts the known targets of Baboto South, Central and North. The targetsare open in all directions and combined air and core drilling methods will beemployed during 2007 to test the strike extensions as well as the potential forplunging high-grade shoots. To increase the company's knowledge and understanding of the Loulo mineraliseddistrict a three year PhD research thesis is being undertaken in conjunctionwith Kingston University, London, England. At Morila the regional drilling completed 89 holes for 44 045 metres. Theresults, although failing to identify an additional deposit, have so farintersected the low-grade (plus 0.1g/t) footprint to the deposit. This datawill be used as a vector for follow-up holes to target for higher-grademineralisation. Drilling at the Samacline target, approximately 500 metres to the west of thepit and some 400 metres below surface, has also continued during the year. Oncompletion of the current drilling programme a scoping study designed to testamenability of the deposit to a small underground mining operation will becompleted. A six month post doctoral research project has been set up through the GeologyDepartment of the Australian National University and the Research School ofEarth Sciences. The aim of this study is to understand the relationship of goldmineralisation to high-grade metamorphism and partial melting of the surroundingsediments. Preliminary results indicate an ore genesis related to the contactthermal aureole of an igneous intrusive. In Mali South, a 40 by 40 kilometre ground gravity survey has been completed,centred over the Morila deposit. The results return an arcuate anomalyimmediately south of the deposit and both to the northeast and northwest of thegrid. Modelling is attempting to estimate the depth and type of geological bodyresponsible for these results. In Senegal, a 10 000 metre RAB drilling programme has commenced to evaluate 12targets. This will help in prioritising additional targets to Delya, Bambarayaand Sofia for diamond drilling later in the year. In Ghana, good progress has been made with the completion of first pass regionalexploration programmes over Randgold Resources' portfolio of four permits; threeof these permits are in the process of being relinquished followingunprospective results while the remaining one, Bole in the north of the country,has returned a 14 kilometre long anomalous, in gold, corridor associated with amajor regional shear at the contact between granite and greenstone. Burkina Faso is showing promise following further drilling at Kiaka which hasidentified a 3 kilometre long mineralised system, within which locates a 1.2kilometre continuous zone of gold mineralisation, 800 metres of which is 100 to200 metres wide, grading at 0.8g/t to 1.6g/t and has been drill tested tovertical depths of 200 metres; it is open in all directions. The best interceptreturned to date is from KDH05: 73 metres at 2.14g/t (from 41 metres) including11 metres at 3.40g/t (from 44 metres) and 14 metres at 3.00g/t (from 58 metres).Infill and step out drilling are planned to commence in February. Elsewhereon our 2 000km(2) permit portfolio, regional programmes are identifying targetsfor follow-up work in the coming year. In the Cote d'Ivoire, with the political situation remaining calm preparationsare nearly complete to commence the 30 000 metres feasibility drilling inFebruary. In Tanzania, generative work is the driver to build a new portfolio of projects;the team is relooking at the Southern Lake Victoria Goldfield, the Proterozoicmobile belts and new greenstone belts within the Craton. To help stimulate the 'next discovery', a dedicated 'African hunting team' hasbeen established and commenced a review of the potentially prospective and newlyemerging countries on the African continent. In summary, the company has a quality portfolio of exploration projects in bothWest and East Africa. It is in a good position to continue its businessstrategy of organic growth through exploration and its primary objective ofdiscovery and development of world class gold mining projects with the potentialfor significant returns. This strategy is attested to by Randgold Resources'discovery and development track record, which includes the Morila and Yaleadeposits, both operating mines in Mali and the plus three million ounce Tongonproject, which is commencing final feasibility stage in the Cote d'Ivoire. CONSOLIDATED INCOME STATEMENT Unaudited Unaudited Unaudited Quarter Quarter Quarter ended ended ended 31 Dec 31 Dec 30 Sept 2005US$000 2006 2006 (Restated)+REVENUESGold sales on spot 73 777 67 205 60 553Loss on matured hedges (4 920) (4 027) -Non-cash profit/(loss)on roll forward of hedges 287 577 -Total 69 144 63 755 60 553OTHER INCOMEInterest income 1 692 1 889 1 067Other income 64 550 194Total other income 1 756 2 439 1 261Total income 70 900 66 194 61 814COSTS AND EXPENSESMine production costs 29 067 29 673 26 822Movement in production inventoryand ore stockpiles (852) (3 528) (3 882)+Depreciation and amortisation 6 532 6 386 4 733General and administration expenses 5 229 2 079 2 724Mining and processing costs 39 976 34 610 30 397+Transport and refinery costs 253 179 162Royalties 4 428 4 101 3 994Exploration and corporateexpenditure 7 412 6 768 7 283Other losses/(gains) - net 330 323 -Exchange losses/(gains) - net 1 311 296 391Other expenses - - 1 536Unwind of discount onprovisions for rehabilitation 289 84 (125)Interest expense 1 138 1 531 997Profit before income tax 15 763 18 302 17 179+Income tax expense (4 973) (5 556) (170)+Net profit 10 790 12 746 17 009+Attributable to:Equity shareholders 9 980 12 285 14 660+Minority shareholders 810 461 2 349 10 790 12 746 17 009+Basic earnings per share (US$) 0.15 0.18 0.22+Fully diluted earnings pershare (US$) 0.14 0.18 0.22+Average shares in issue (000) 68 695 68 474 65 311 CONSOLIDATED INCOME STATEMENT (cont'd) Unaudited Unaudited 12 months 12 months ended ended 31 Dec 31 Dec 2005US$000 2006 (Restated)+REVENUESGold sales on spot 274 907 151 502Loss on matured hedges (12 190) -Non-cash profit/(loss) on roll forwardof hedges (4 413) -Total 258 304 151 502OTHER INCOMEInterest income 7 384 2 064Other income 1 168 1 303Total other income 8 552 3 367Total income 266 856 154 869COSTS AND EXPENSESMine production costs 115 217 66 612Movement in production inventoryand ore stockpiles (13 373) (18 744)+Depreciation and amortisation 22 844 11 910General and administration expenses 13 006 7 438Mining and processing costs 137 694 67 216+Transport and refinery costs 711 360Royalties 16 979 10 273Exploration and corporate expenditure 28 805 24 049Other losses/(gains) - net 653 (45)Exchange losses/(gains) - net 970 2 074Other expenses 705 801Unwind of discount on provisions forrehabilitation 541 254Interest expense 5 825 1 861Profit before income tax 73 973 48 026+Income tax expense (23 097) (170)+Net profit 50 876 47 856+Attributable to:Equity shareholders 47 564 45 507+Minority shareholders 3 312 2 349 50 876 47 856+Basic earnings per share (US$) 0.70 0.74+Fully diluted earnings per share (US$) 0.69 0.71+Average shares in issue (000) 68 392 61 702 The results have been prepared in accordance with International FinancialReporting Standards (IFRS). + Restated due to change in accounting policy relating to deferred stripping.See note on accounting policies. CONSOLIDATED BALANCE SHEET Unaudited Unaudited Unaudited at at at 31 Dec 31 Dec 30 Sept 2005US$000 2006 2006 (Restated)+AssetsNon-current assetsProperty, plant and equipment 241 300 237 168 202 636Cost 297 839 287 175 236 331Accumulated depreciationand amortisation (56 539) (50 007) (33 695)Deferred stripping costs - - -+Deferred taxation 2 993 2 696 2 957+Long-term ore stockpiles 41 614 29 522 22 176+Receivables 13 702 - -Total non-current assets 299 609 269 386 227 769+Current assetsDeferred stripping costs - - -+Inventories and stockpiles 34 200 40 473 34 210+Receivables 34 999 52 169 47 918Cash and cash equivalents 143 356 155 320 152 452Total current assets 212 555 247 962 234 580+Total assets 512 164 517 348 462 349+Shareholders' equity 336 063 328 911 301 822+Minority interest 4 707 3 897 1 395Total equity 340 770 332 808 303 217+Non-current liabilitiesLong-term borrowings 25 666 36 777 49 538Loans from minority shareholdersin subsidiaries 2 773 2 663 2 483Deferred taxation 462 - -+Financial liabilities -forward gold sales 39 969 40 128 34 151Provision for rehabilitation 8 842 9 751 9 480Total non-current liabilities 77 712 89 319 95 652Current liabilitiesFinancial liabilities - forwardgold sales 27 525 22 982 8 939Current portion of long-termborrowings 24 818 24 730 22 991Accounts payable and accruedliabilities 39 461 42 575 28 813Taxation payable 1 878 4 934 2 737Total current liabilities 93 682 95 221 63 480Total equity and liabilities 512 164 517 348 462 349+ + Restated due to change in accounting policy relating to deferred stripping. See note on accounting policies. Property, plant and equipment increased significantly year on year, mainly dueto the completion of the Loulo capital project and funds being spent onunderground equipment and the decline shaft sinking at Loulo. The increase in long-term stockpiles relates to Morila, where the current lifeof mine plan envisages a build up of stockpiles until mining of the pit stops in2009. After this, the lower grade stockpiles will be processed. Significant balances include advances to the main contractor at Loulo, MDMFerroman (Pty) Ltd (in liquidation) ("MDM"). MDM was the contractor responsiblefor construction of the Loulo mine ("MDM contract"). At the end of 2005, thecompany determined that MDM was unable to perform its obligations under the MDMcontract, at which time the company enforced a contractual remedy which allowedit to act as its own general contractor and to complete the remaining work onthe Loulo project that was required under the MDM contract. As a result ofMDM's failure to perform under the MDM contract, the company believes that it isentitled to recover from MDM all amounts paid in excess of the lump sumcontract. This comprises payments totalling US$32 million, which have beencapitalised as part of the cost of the project, US$9 million in respect ofdamages arising from the delayed completion of the project, and loan agreementssigned by MDM of US$12.1 million included in Receivables. As part of thecompany's efforts to recoup the monies owed to it, MDM was liquidated followedby a South African Companies Act Section 417 investigation into the businessactivities of MDM. Significant uncertainties exist as to the recoverability of the amounts due byMDM to the company. The directors believe that the group will be able torecover in full the US$12.1 million included in Receivables. This is dependenton the amounts which can be recovered from the performance bonds, personalguarantees and other assets provided as security and, if these amounts prove tobe insufficient, the outcome of the liquidation of MDM. The aggregate amountwhich will ultimately be recovered can not presently be determined. Thefinancial statements do not reflect any additional provision that may berequired if the US$12.1 million cannot be recovered in full. Recovery of the other US$41 million is dependent on the extent to which thegroup's claim is accepted by the liquidator and the outcome of the liquidationof MDM. The ultimate outcome of this claim cannot presently be determined. Thefinancial statements do not reflect any reduction to the cost of the Loulodevelopment that may arise from the claim, any additional income that may arisefrom the claim for damages, or any charge that may arise from MDM's inability tosettle amounts that are determined to be payable by MDM to the group in respectof the Loulo development. As in the previous year, this significant uncertainty will be the subject of anemphasis of matter in the auditors' report on the financial statements. Receivables also includes US$20.3 million relating to reimbursable fuel dutiesand TVA owing by the Government of Mali to Morila and Loulo. A provision ofUS$1.3 million based on an estimate of the time value of money given theslow-moving nature of these amounts has been raised this year. Accounts payable has increased significantly in the year due to the build up ofstores to a normal operating level at Loulo. The non current receivables of US$13.7 million are those parts of the MDM andMalian Government receivables which, whilst legally payable immediately, areanticipated to be reimbursed after more than 12 months. CONSOLIDATED CASHFLOW STATEMENT Unaudited Unaudited 12 months 12 months ended ended 31 Dec 31 Dec 2005US$000 2006 (Restated)+Profit before income tax 73 973 48 026+Adjustment for non-cash items 29 636 14 367+Effects of changes in operatingworking capital items (18 415) (32 267)+Income tax paid (14 784) (390)Net cash generated from operating activities 70 410 29 736Additions to property, plant and equipment (61 508) (73 217)Financing of contractors 105 (11 276)Net cash used by investing activities (61 403) (84 493)Ordinary shares issued 3 653 105 248(Decrease)/increase in long-term loans (21 756) 23 721Net cash (used by)/generated fromfinancing activities (18 103) 128 969Net (decrease)/increase in cash andcash equivalents (9 096) 74 212Cash and cash equivalents atbeginning of year 152 452 78 240Cash and cash equivalents at end of year 143 356 152 452 + Restated due to change in accounting policy relating to deferred stripping. See note on accounting policies. CONSOLIDATED STATEMENT OF CHANGES IN EQUITY Number of Share Share Other ordinary capital premium reserves Shares US$000 US$000 US$000 Balance - 31 Dec 2004(as previously reported) 59 226 694 2 961 102 342 (14 347)Change in accountingpolicy - - - -Balance - 31 Dec 2004 59 226 694 2 961 102 342 (14 347)Net income - - - -Movement on cash flowhedges -Transfer to incomestatement - - - (45)Fair value movementon financial instruments - - - (27 422)Total recognisedincome/(loss) - - - (27 467)Share-based payments - - - 2 243Share options exercised 617 260 31 1 838 -Shares vested# 103 910 6 1 429 (1 429)Capital raising 8 125 000 406 109 281 -Costs associated withcapital raising - - (6 308) -Balance - 31 Dec 2005 68 072 864 3 404 208 582 (41 000)Net income - - - -Movement on cashflow hedges -Transfer to incomestatement - - - 17 256Fair value movementon financial instruments - - - (36 603)Total recognisedincome/(loss) - - - (19 347)Share-based payments - - - 2 369Share options exercised 633 867 34 3 619 -Exercise of optionspreviously expensed underIFRS2 - - 650 (650)Shares vested# 56 830 2 802 (802)Balance - 31 Dec 2006 68 763 561 3 440 213 653 (59 430) CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (cont'd) Total attribu- Accum table ulated to equity Minority Total profits Share interest equity US$000 holders US$000 US$000 Balance - 31 Dec 2004(as previously reported) 100 213 191 169 (954) 190 215Change in accountingpolicy (14 884)+ (14 884)+ - (14 884)+Balance - 31 Dec 2004 85 329+ 176 285+ (954) 175 331+Net income 45 507+ 45 507+ 2 349 47 856+Movement on cash flowhedges -Transfer to incomestatement - (45) - (45)Fair value movementon financial instruments - (27 422) - (27 422)Total recognisedincome/(loss) 45 507+ 18 040 2 349 20 389Share-based payments - 2 243 - 2 243Share options exercised - 1 869 - 1 869Shares vested# - 6 - 6Capital raising - 109 687 - 109 687Costs associated withcapital raising - (6 308) - (6 308)Balance - 31 Dec 2005 130 836+ 301 822+ 1 395 303 217+Net income 47 564 47 564 3 312 50 876Movement on cash flowhedges -Transfer to incomestatement - 17 256 - 17 256Fair value movementon financial instruments - (36 603) - (36 603)Total recognisedincome/(loss) 47 564 28 217 3 312 31 529Share-based payments - 2 369 - 2 369Share options exercised - 3 653 - 3 653Exercise of optionspreviously expensedunder IFRS2 - - - -Shares vested# - 2 - 2Balance - 31 Dec 2006 178 400 336 063 4 707 340 770 # Restricted shares were issued to directors as remuneration. The transfer between "other reserves" and "share premium" in respect of the shares vested represents the cost calculated in accordance with IFRS 2. + Restated due to change in accounting policy relating to deferred stripping. See note on accounting policies. NON-GAAP MEASURESTotal cash costs and cash cost per ounce are non-GAAP measures. Total cashcosts and total cash costs per ounce are calculated using guidance issued by theGold Institute. The Gold Institute was a non profit industry associationcomprised of leading gold producers, refiners, bullion suppliers andmanufacturers. This institute has now been incorporated into the NationalMining Association. The guidance was first issued in 1996 and revised inNovember 1999. Total cash costs, as defined in the Gold Institute's guidance,include mine production, transport and refinery costs, general andadministrative costs, movement in production inventories and ore stockpiles,transfers to and from deferred stripping where relevant, and royalties. Underthe company's revised accounting policies, there are no transfers to and fromdeferred stripping. Total cash costs per ounce are calculated by dividing total cash costs, asdetermined using the Gold Institute guidance, by gold ounces produced for theperiods presented. Total cash costs and total cash costs per ounce arecalculated on a consistent basis for the periods presented. Total cash costsand total cash costs per ounce should not be considered by investors as analternative to operating profit or net profit attributable to shareholders, asan alternative to other IFRS or US GAAP measures or an indicator of ourperformance. The data does not have a meaning prescribed by IFRS or US GAAP andtherefore amounts presented may not be comparable to data presented by goldproducers who do not follow the guidance provided by the Gold Institute. In particular depreciation, amortisation and share-based payments would beincluded in a measure of total costs of producing gold under IFRS and US GAAP,but are not included in total cash costs under the guidance provided by the GoldInstitute. Furthermore, while the Gold Institute has provided a definition forthe calculation of total cash costs and total cash costs per ounce, thecalculation of these numbers may vary from company to company and may not becomparable to other similarly titled measures of other companies. However,Randgold Resources believes that total cash costs per ounce are usefulindicators to investors and management of a mining company's performance as itprovides an indication of a company's profitability and efficiency, the trendsin cash costs as the company's operations mature, and a benchmark of performanceto allow for comparison against other companies. Cash operating costs and cash operating cost per ounce are calculated bydeducting royalties from total cash costs. Cash operating costs per ounce arecalculated by dividing cash operating costs by gold ounces produced for theperiods presented. Gold sales is a non-GAAP measure. It represents the sales of gold at spot andthe gains/losses on hedge contacts which have been delivered into at thedesignated maturity date. It excludes gains/losses on hedge contracts whichhave been rolled forward to match future sales. This adjustment is consideredappropriate because no cash is received/paid in respect of these contracts. Profit from mining activity is calculated by subtracting total cash costs fromgold sales revenue for all periods presented. The following table reconciles total cash costs, profit from mining activity andprofit from operations as non-GAAP measures, to the information provided in theincome statement, determined in accordance with IFRS, for each of the periodsset out below: Quarter Quarter Quarter ended ended ended 31 Dec 31 Dec 30 Sept 2005US$000 2006 2006 (Restated)+Gold sales on spot 73 777 67 205 60 553Loss on matured hedges (4 920) (4 027) -Gold sales 68 857 63 178 60 553Mine production costs 29 067 29 673 26 822Movement in productioninventory and ore stockpiles (852) (3 528) (3 882)+Transfer from deferred stripping - - -+Transport and refinery costs 253 179 162Royalties 4 428 4 101 3 994General and administrationexpenses 5 229 2 079 2 724Total cash costs 38 125 32 504 29 820+Profit from mining activity 30 732 30 674 30 733+ (cont'd) 12 months 12 months ended ended 31 Dec 31 Dec 2005US$000 2006 (Restated)+Gold sales on spot 274 907 151 502Loss on matured hedges (12 190) -Gold sales 262 717 151 502Mine production costs 115 217 66 612Movement in production inventoryand ore stockpiles (13 373) (18 744)+Transfer from deferred stripping - -+Transport and refinery costs 711 360Royalties 16 979 10 273General and administration expenses 13 006 7 438Total cash costs 132 540 65 939+Profit from mining activity 130 177 85 563+ + Restated due to change in accounting policy relating to deferred stripping. See note on accounting policies. ACCOUNTING POLICIESThe financial information in this report has been prepared in accordance withthe group's accounting policies, which comply with IFRS and are consistent withthe prior period, except as noted below. Joint ventures are those investments in which the group has joint control andare accounted for under the proportional consolidation method. Under thismethod, the proportion of assets, liabilities, income and expenses and cashflows of each joint venture attributable to the group are incorporated in theconsolidated financial statements under appropriate headings. Inter-companyaccounts and transactions are eliminated on consolidation. The directors have changed the group's accounting policy on deferred strippingcosts, under both IFRS and US GAAP in the current period. Previously, costs ofproduction stage waste stripping in excess of the expected pit life averagestripping ratio were deferred and then charged to production when the actualstripping ratio was below the expected pit life average stripping ratio. Underthe revised accounting policy, all stripping costs incurred during theproduction phase of a mine are treated as variable production costs and as aresult are included in the cost of the inventory produced during the period thatthe stripping costs are incurred. Under US GAAP, EITF 04-06 'Accounting for Stripping Costs Incurred duringProduction in the Mining Industry' is effective for reporting periods beginningafter 15 December 2005. The consensus does not permit the deferral of any wastestripping costs during the production phase of a mine, but requires instead thatthey should be treated as variable production costs. The directors have decidedto adopt the same treatment under IFRS which will ensure that the accountingpolicies applied under IFRS and US GAAP remain in line. With regard to theconclusions reached by the EITF, the directors believe the revised policy willmean that the financial statements provide reliable and more relevantinformation about the group's financial position and its financial performance.In accordance with the requirements of IAS 8 "Accounting Policies, Changes inAccounting Estimates and Errors", the change in the IFRS policy has been appliedretrospectively and hence the 2005 comparatives have been restated. IFRIC Interpretation 4 "Determining whether an arrangement contains a lease" wasadopted during the year. This resulted in certain contracts being classified asoperating leases. The change in the IFRS accounting policy has resulted in the followingadjustments to the amounts reported under IFRS: 31 Dec 30 Sept 31 DecUS$000 2006 2006 2005Decrease in deferred stripping costs 2 115 - 3 687Decrease in ore stockpiles 6 324 9 150 8 342Decrease/(increase) in gold in process 36 (11) 51Decrease in deferred taxation liability 1 227 - 1 227(Decrease)/Increase in deferredtaxation asset 2 966 311 2 938Decrease in opening retained earnings 7 915 14 584 14 884 Quarter Quarter Quarter Year Year ended ended ended ended ended 31 Dec 30 Sept 31 Dec 31 Dec 31 DecUS$000 2006 2006 2005 2006 2005(Decrease)/increasein net profit (126) 580 4 583 3 633 6 969Increase/(decrease)in basic earnings pershare (cents pershare) - 1 7 6 12Increase in fullydiluted earningsper share (centsper share) - 1 7 6 11 FORWARD COMMODITY CONTRACTSThe group's hedging position which all relates to the Loulo project financing,was as follows at 31 December 2006: Forward sales Forward salesMaturity date Ounces average US$/ozYear ended 2007 132 583 438Year ended 2008 80 496 431Year ended 2009 84 996 437Total 298 075 436 The remaining portion of the hedge book represents approximately 33% of plannedproduction at Loulo for the period that the project finance is in place and 20%of the group's attributable production. In the current gold price environment,it is the company's intention to roll out to 2010 some of the 2007 forward salescontracts to provide some protection during the Loulo underground capitalprogramme. Morila's production is completely exposed to spot gold prices. During the quarter, the company delivered into 27 158/oz of its hedge book at anaverage price of US$434/oz and rolled longer-dated 10 580 ounces. PROSPECTSLife of mine scheduling at Morila anticipates production for 2007 to beapproximately 500 000 ounces. Morila continues to be a significant cashgenerator with no debt and no hedging. Loulo's 2007 production is scheduled to exceed 250 000 ounces. The undergrounddevelopment at Yalea is underway and should access first ore towards the end of2007 with full production due in 2009. Yalea is the first of the two Loulounderground mines, and is currently a bigger ore body with higher grades thanthe Gara deposit. The underground mines are expected to not only add life toLoulo but to increase levels of annual production to in excess of 400 000 ouncesin 2011. Total cash costs for the group are estimated to increase year on year between10% and 15% depending on diesel price assumptions and gold price which impactson Mali Government royalties paid. The final feasibility study has commenced at Tongon. This will take some 24months and cost around US$10 million. In the coming year, the group plans to spend similar amounts to 2006 on itsinvestment in exploration and corporate. The company plans to retain its focus on organic growth through discovery anddevelopment of world class orebodies. It will also continue to monitor themarket for value creating and or strategic M&A opportunities. D M Bristow R A WilliamsChief Executive Financial Director 5 February 2007 --------------------------------------------------------------- RANDGOLD RESOURCES UPDATES GARA EXTENDS LOULO'S LIFE TO 2004 The redesign of the proposed Gara underground mine, based on a resource increaseof 800 000 ounces produced by deep-drilling exploration, has lifted the Loulocomplex firmly into the world-class category. Gara, which now has an underground ore reserve of 1.38 million ounces, isscheduled to produce at 100 000 tonnes per month, with development due to startat the beginning of 2009. This has extended Loulo's reserve life to 2024 and isestimated to build production from the current 250 000 ounces per year to morethan 350 000 ounces per year for the seven-year period 2009 - 2015, peakingabove 400 000 ounces in 2011 and 2012. "Loulo has come a very long way since we started developing it," says AdrianReynolds, general manager - exploration and evaluation. "It was initially basedon two open pits, Yalea and Gara (then called Loulo 0) and had a mine life ofjust over five years on an ore reserve of 11.7 million tonnes at a grade of3.77g/t for a total gold content of 1.4 million ounces. But we could seeenormous potential in the strike extensions of the known orebodies and also inthe depth extensions under the open pits. While deep drilling is slow andexpensive, we were confident in the continuity of Loulo's gold mineralisation atdepth, analogous to that of the 100-year Obuasi underground mine in Ghana." The results of the deep drilling have more than justified this confidence,increasing the Loulo resource base to more than 10 million ounces andidentifying two underground mines to complement the open-pit operations. Thefirst of these is Yalea, scheduled to produce at 80 000 tonnes per month, andGara will be the second. Development at Yalea is already well underway, with the first blast in hard rockin December last year marking the start of the decline. Thinus Strydom, the manager of underground mining at Loulo, notes that RandgoldResources is in effect building West Africa's first modern mechanisedunderground gold mine at Yalea. "Installing an underground conveyor belt system is a significant innovationwhich will enable us to achieve higher production rates. We are alsointroducing a number of other advanced techniques such as Reverse Avoca stoping,backfill for support and forced ventilation," Strydom says. "While Mali is known for very successful open-pit operations, its undergroundexperience is limited to the small-scale Kalana mine. The systems andtechnologies which we shall be employing at Loulo will build up the undergroundmining expertise in Mali to the point where it can challenge Ghana as the miningcapital of West Africa." RANDGOLD RESOURCES' STRATEGY: THE COMPASS THAT GUIDES ITS GROWTH Randgold Resources' continued success, reflected again in its results for 2006,are attributable to the fact that the business is managed for the long-term andnot with one eye on the next quarter and the other on the whims of the market,says chief executive Mark Bristow. "Our central strategy is a straightforward one: to grow organically throughdiscovery and development, because that is inarguably the best way to createvalue," he says. "Of course, nowadays exploration is back in vogue and thevirtues of finding deposits rather than buying them are praised throughout theindustry. The difference is that we've always believed this and we put ourmoney where our mouth was. The substantial investment we made in exploration inthe lean years, when the industry was generally cutting back, is paying offhandsomely for us now, and it will continue to do so for the foreseeable future." The commitment to organic growth is not a blinkered one, however, and thecompany watches the market closely for corporate growth opportunities. But,says Bristow, while Randgold Resources' management has carefully evaluated manyof these, it has yet to find one that is truly value creating. The flurry ofmergers and acquisitions that has characterised the industry in recent years, henotes, has consolidated but not grown it. Under the umbrella of its central strategy, Randgold Resources' hassub-strategies for each aspect of the business. There is an overall explorationstrategy, for example, supported by a series of regional strategies. Thecompany's constantly replenished prospect pipeline attests to their efficacy.Corporate finance and marketing are other areas where a grand design isdiligently pursued. Success in these fields is demonstrated by theeffectiveness with which the company has funded and managed its major projectdevelopments, as well as by the quality of its share register and the breadth ofits shareholder base. All these strategies are regularly and rigorously tested. A strategy shouldonly be adjusted if there is a compelling reason to do so, however - and formore than 10 years, says Bristow, Randgold Resources' philosophy of organicgrowth has served it very well. EXPLORATION: MAKING YOUR OWN LUCK What does it take to find a world-class gold deposit? Science only gets you sofar, says Randgold Resources exploration manager Paul Harbidge, and after thatit becomes a question of experience, intuition and creative thinking. "Exploration is both a science and an art," explains Harbidge. "We usepainstakingly constructed regional models to find structural and geologicalsettings that could host major deposits, but even with a high level oftechnological expertise and thorough evaluation it's still a bit like huntingfor a needle in a haystack. It takes a sound exploration strategy and talentedpeople to find those rare and elusive deposits." Harbidge notes that Randgold Resources' exploration team boasts highlyaccomplished geologists who already have two world-class discoveries - Morilaand Yalea - to their credit. However, team members also have a wide range ofother qualifications, such as MBAs, which makes for a well-balanced skills base,as well as giving the team a broad perspective and strong dash of commercialacumen. "Our exploration is strategically driven and constantly tested, and although wehave budgets for each country, the regional teams still have to compete fordrilling dollars to ensure that the best targets get priority," he says. "You never can tell when you're going to make the next big discovery, but whenyou combine hard work, quality skills and experience with tenacity and theability to recognise potential, you make your own luck." Following another busy exploration year, in which it expanded its presence inWest and East Africa's most prospective gold belts, Randgold Resources currentlyhas 128 targets on holdings of 20 414km(2) in six countries. In addition, ithas recently established a generative team to assess the African countries inwhich the company does not already have a presence with a view to identifyingopportunities there. COMPLIANCE IN A COMPLEX MULTI-JURISDICTIONAL ENVIRONMENT When Randgold Resources was incorporated in 1995, the board made a strategicdecision to source the company's capital from first-world markets andconsequently listed it on the main board of the London Stock Exchange in 1997.This meant that the fledgling company had to meet stringent accounting andcorporate governance standards from the outset. In order to improve the liquidity of its stock, the company also listed onNasdaq in 2002 after meeting the rigorous requirements of the US Securities andExchange Commission. The fact that it has since also adhered to US reportingand accounting standards has encouraged North American investors, and some 75%of its share capital is now traded on Nasdaq. "While the corporate governance climate has been substantially codified inrecent years, the company has always sought to go beyond the letter of the lawin meeting the highest standards in its relations with our investors. We remaincommitted to providing shareholders with accurate and timeous information toenable them to best evaluate their investment and the company's performance,"says group finance director Roger Williams. ----------------------------------------------------------------- REGISTERED OFFICE:La Motte Chambers, La Motte Street, St Helier, Jersey JE1 1BJ, Channel Islands REGISTRARS:Computershare Investor Services (Channel Islands) Limited, PO Box 83, OrdnanceHouse, 31 Pier Road, St Helier, Jersey JE4 8PW, Channel Islands TRANSFER AGENTS:Computershare Services PLC, PO Box 663, 7th Floor, Jupiter House, Triton Court,14 Finsbury Square, London EC2A 1BR INVESTOR AND MEDIA RELATIONS:For further information contact Kathy du Plessis on Tel +27 (11) 728-4701,Mobile +27 83 266 5847, Fax +27 (11) 728-2547 E-MAIL:[email protected] www.randgoldresources.com DISCLAIMER: Statements made in this document with respect to Randgold Resources'current plans, estimates, strategies and beliefs and other statements that arenot historical facts are forward-looking statements about the future performanceof Randgold Resources. These statements are based on management's assumptionsand beliefs in light of the information currently available to it. RandgoldResources cautions you that a number of important risks and uncertainties couldcause actual results to differ materially from those discussed in theforward-looking statements, and therefore you should not place undue reliance onthem. The 2005 annual report notes that the financial statements do not reflectany provisions or other adjustments that might arise from the claims and legalprocess initiated by Loulo against MDM. Other potential risks and uncertaintiesinclude risks associated with: fluctuations in the market price of gold, goldproduction at Morila, the development of Loulo and estimates of resources,reserves and mine life. For a discussion on such other risk factors refer tothe annual report on Form 20-F for the year ended 31 December 2005 which wasfiled with the United States Securities and Exchange Commission (the 'SEC') on29 June 2006. Randgold Resources assumes no obligation to update information inthis release. Cautionary note to US investors: the 'SEC' permits companies, intheir filings with the 'SEC', to disclose only proven and probable ore reserves.We use certain terms in this release, such as "resources", that the 'SEC' doesnot recognise and strictly prohibits us from including in our filings with the 'SEC'. Investors are cautioned not to assume that all or any parts of ourresources will ever be converted into reserves which qualify as 'proven andprobable reserves' for the purposes of the SEC's Industry Guide number 7. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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