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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Galantas Gold Corporation | LSE:GAL | London | Ordinary Share | CA36315W3012 | COM SHS NPV |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 12.50 | 11.50 | 13.50 | 12.50 | 12.50 | 12.50 | 0.00 | 08:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Gold Ores | 0 | -16.63M | -0.1448 | -1.45 | 24.12M |
From Apr 2019 to Apr 2024
TIDMGAL
RNS Number : 9268H
Galantas Gold Corporation
24 August 2016
GALANTAS GOLD CORPORATION
TSXV & AIM : Symbol GAL
GALANTAS REPORTS RESULTS FOR THE THREE AND SIX MONTHSED JUNE 30, 2016
August 24, 2016: Galantas Gold Corporation (the 'Company') is pleased to announce its financial results for the three and six months ended June 30, 2016.
Financial Highlights
Highlights of the 2016 second quarter's and first six months results, which are expressed in Canadian Dollars, are summarized below:
Hot Features
Premium
All figures denominated in Canadian Dollars (CDN$)
Second Quarter Ended Six Months Ended
June 30 June 30
2016 2015 2016 2015
-------------------------------------------------------- ---------------------------- ------------------------------
Revenue $ 1,648 $ 13,774 $ 29,721 $ 14,897
-------------------------------------------------------- ------------- ------------- --------------- -------------
Cost of Sales $ (88,572) $ (114,656) $ (210,103) $ (184,653)
-------------------------------------------------------- ------------- ------------- --------------- -------------
Loss before the undernoted $ (86,924) $ (100,882) $ (180,382) $ (169,756)
-------------------------------------------------------- ------------- ------------- --------------- -------------
Depreciation $ (42,732) $ (49,881) $ (90,283) $ (102,174)
-------------------------------------------------------- ------------- ------------- --------------- -------------
General administrative expenses $ (419,506) $ (624,852) $ (755,617) $ (886,384)
-------------------------------------------------------- ------------- ------------- --------------- -------------
Gain on sale of property, plant and equipment $ 5,479 $ 0 $ 5,479 $ 0
-------------------------------------------------------- ------------- ------------- --------------- -------------
Unrealized gain on fair value of derivative financial
liability $ 1,000 $ 95,000 $ 80,000 $ 103,000
-------------------------------------------------------- ------------- ------------- --------------- -------------
Foreign exchange loss $ (103,146) $ (28,142) $ (78,371) $ (67,542)
-------------------------------------------------------- ------------- ------------- --------------- -------------
Net Loss for the period $ ( 645,829) $ (708,757) $ (1,019,174) $ (1,122,856)
-------------------------------------------------------- ------------- ------------- --------------- -------------
Working Capital Deficit $ (2,068,440) $ (4,273,046) $ (2,068,440) $(4,273,046)
-------------------------------------------------------- ------------- ------------- --------------- -------------
Cash loss from operating activities before changes in
non-cash working capital $ (300,796) $ (457,670) $ (337,823) $ (958,758)
-------------------------------------------------------- ------------- ------------- --------------- -------------
Cash at June 30, 2016 $ 1,312,989 $ 198,696 $ 1,312,989 $ 198,696
-------------------------------------------------------- ------------- ------------- --------------- -------------
The Net Loss for the three months ended June 30, 2016 amounted to CDN$ 645,829 (2015:CDN$ 708,757) and the cash loss from operating activities before changes in non-cash working capital for the second quarter of 2016 amounted to CDN$ 300,796 (2015 Q2: CDN$ 457,670). The Net Loss for the six months ended June 30, 2016 amounted to CDN$ 1,019,174 (2015:CDN$ 1,122,856) and the cash loss from operating activities before changes in non-cash working capital for the first six months of 2016 amounted to CDN$ 337,823 (2015: CDN$ 958,758).
Sales revenues for the second quarter and six months ended June 30, 2016 consisted of jewelry sales and amounted to CDN$ 1,648 and CDN$ 29,721 respectively (2015: CDN $ 13,774 and $ 14,897 respectively). Following the suspension of production during the fourth quarter of 2013 there have not been any shipments of concentrates from the mine.
Cost of sales, which includes production costs and inventory movement, for the second quarter and six months ended June 30, 2016 amounted to CDN$ 88,572 and $ 210,103 respectively (2015: CDN$ 114,656 and $ 184,653). Production costs were mainly in connection with ongoing care, maintenance and restoration costs at the Omagh mine site.
The Company had cash balances of $ 1,312,989 at June 30, 2016 compared to $ 198,696 at June 30, 2015. The working capital deficit at June 30, 2016 amounted to $ 2,068,440 compared to a working capital deficit of $ 4,273,046 at June 30, 2015.
During the second quarter the Company announced a private placement of shares and shares for debt exchange. Placing priority was given to existing shareholders, with 18,619,841 common shares issued, at a price of CDN$ 0.07875 per common share for a total of CDN $1,466,312. The majority of the placement was taken up by Mr. Ross Beaty, who acquired 12,825,397 common shares. As a consequence of the placing, Mr. Beaty has an interest in 28,825,397 Common Shares or 20.9% of the Company's issued common shares.
In addition to the private placement, Roland Phelps, President & CEO, Galantas Gold Corporation, entered into a shares for debt exchange on the same terms as the placement. Mr. Phelps exchanged $ 935,852 debt accruing to him for 11,883,835 common shares. Shareholder consent was received for the debt exchange by means of a written resolution, with a majority of disinterested shareholder votes consenting. Following the debt exchange, Mr. Phelps holds 33,356,750 common shares, representing 24.2% of the enlarged number of common shares in issue.
Production
Production at the Omagh mine remains suspended. However the granting of planning consent during the 2015 for an underground operation at the Omagh site, now subject to a judicial review to be heard in September 2016, will permit the continuation and expansion of gold mining. The underground mine will utilize the same processing methods. The strategy is to establish the underground mine as soon as finance is available and look for further expansion of gold resources on the property, which has many undrilled targets.
Exploration
The drilling program, which recommenced in September 2015, continued into the first quarter of 2016 with two drill rigs in operation and a further six holes were completed before the rigs left the site in March. In early 2016 Galantas reported the assay results for three holes completed in 2015 (see press release dated January 26, 2016). Most notable was hole OML-DD-15-155 which intersected a wide zone (13 m true width) of the Joshua vein at a vertical depth of 117 m grading 9.9 g/t Au. This drilling program also identified a new vein, Kestrel, running 70 m west of Joshua. An initial shallow (42.4 m) intersect returned 35.8 g/t Au over 0.7 m (true width). A later second hole targeted the Kestrel vein approximately 80m north of the previous hole and hit mineralisation at a vertical depth of 73 m (3.2 g/t Au over 1.2 m true width). A detailed table of drilling data is included in an addendum to this release.
Following extensive geological review, which included a detailed mapping study reported on 9(th) August 2016, new targets have been outlined in preparation for future drilling.
An area of PL3039 in the Republic Of Ireland was revisited during Q2. The results of earlier fieldwork had shown bedrock gold anomalies of 2.1 and 1.8 g/t, associated with significant silver. Recent excavations of the site for construction purposes revealed narrow mineralised quartz veins along 5 m strike. Samples of these were taken for analysis.
Permitting
In June 2015 the Company reported that the Minister of Environment, Northern Ireland had granted planning consent for an underground gold mine at the Omagh site. The planning consent will permit the continuation and expansion of gold mining and is expected to create hundreds of jobs locally. The positive decision is the result of 3 years of examination of environmental and other factors regarding the application. Included were environmental studies by NIEA (Northern Ireland Environment Agency) and independent specialists. The consent includes operating and environmental conditions, which the Company has reviewed. Some conditions require clarification but appear workable with some modifications to operating and construction methodology. A number of conditions precedent to development are required to be satisfied and the Company is carrying those out.
Later in 2015 Galantas reported that they had been made aware of pre-action correspondence from an individual who intends to challenge, by judicial review, the actions of the Department of Environment Northern Ireland (DOENI) in granting planning permission for underground mining beneath the existing open pit. During the first quarter, Galantas confirmed that this third party had obtained leave from Belfast High Court to bring a judicial review of the planning consent granted by Department of Environment Northern Ireland, for the Company's underground mine. The review is scheduled to be heard in September 2016.
Roland Phelps, President & CEO, Galantas Gold Corporation, commented, "Rehabilitation work at the mine has been continued during the last quarter. Additional conditions precedent to the underground planning permit have been satisfied. The processing plant has been subject to throughput checks and is operational, awaiting ore. Initial underground mining equipment is receiving modification to suit Galantas requirements and is expected to be delivered shortly. The exploration program continues to progress well, with a new vein discovered, our best ever drilling result in terms of gold accumulation in Hole 155 and new targets added."
The detailed results and Management Discussion and Analysis (MD&A) are available on www.sedar.com and www.galantas.com and the highlights in this release should be read in conjunction with the detailed results and MD&A. The MD&A provides an analysis of comparisons with previous periods, trends affecting the business and risk factors.
http://www.rns-pdf.londonstockexchange.com/rns/9268H_-2016-8-23.pdf
Qualified Person
The financial components of this disclosure has been reviewed by Leo O' Shaughnessy (Chief Financial Officer) and the production, exploration and permitting components by Roland Phelps (President & CEO), qualified persons under the meaning of NI. 43-101. The information is based upon local production and financial data prepared under their supervision.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS: This press release contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws, including revenues and cost estimates, for the Omagh Gold project. Forward-looking statements are based on estimates and assumptions made by Galantas in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors that Galantas believes are appropriate in the circumstances. Many factors could cause Galantas' actual results, the performance or achievements to differ materially from those expressed or implied by the forward looking statements or strategy, including: gold price volatility; discrepancies between actual and estimated production, actual and estimated metallurgical recoveries and throughputs; mining operational risk, geological uncertainties; regulatory restrictions, including environmental regulatory restrictions and liability; risks of sovereign involvement; speculative nature of gold exploration; dilution; competition; loss of or availability of key employees; additional funding requirements; uncertainties regarding planning and other permitting issues; and defective title to mineral claims or property. These factors and others that could affect Galantas's forward-looking statements are discussed in greater detail in the section entitled "Risk Factors" in Galantas' Management Discussion & Analysis of the financial statements of Galantas and elsewhere in documents filed from time to time with the Canadian provincial securities regulators and other regulatory authorities. These factors should be considered carefully, and persons reviewing this press release should not place undue reliance on forward-looking statements. Galantas has no intention and undertakes no obligation to update or revise any forward-looking statements in this press release, except as required by law.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Enquiries
Galantas Gold Corporation
Jack Gunter P.Eng - Chairman
Roland Phelps C.Eng - President & CEO
Email: info@galantas.com
Website: www.galantas.com
Telephone: +44 (0) 2882 241100
Grant Thornton UK LLP (Nomad)
Philip Secrett, Richard Tonthat
Telephone: +44(0)20 7383 5100
Whitman Howard Ltd (Broker & Corporate Adviser)
Ranald McGregor-Smith, Nick Lovering
Telephone: +44(0)20 7659 1234
NOTICE TO READER
The accompanying unaudited condensed interim consolidated financial statements of Galantas Gold Corporation (the "Company") have been prepared by and are the responsibility of management. The unaudited condensed interim consolidated financial statements have not been reviewed by the Company's auditors.
Galantas Gold Corporation
Condensed Interim Consolidated Statements of Financial Position
(Expressed in Canadian Dollars)
(Unaudited)
As at As at
June 30, December 31,
2016 2015
----------------------------------------------------- ----------- ------------
ASSETS
Current assets
Cash $ 1,312,989 $ 1,518,332
Accounts receivable and prepaid expenses (note 4) 180,579 249,659
Inventories (note 5) 24,804 43,875
----------------------------------------------------- ----------- ------------
Total current assets 1,518,372 1,811,866
Non-current assets
Property, plant and equipment (note 6) 7,583,541 8,686,902
Long-term deposit (note 8) 516,750 612,210
Exploration and evaluation assets (note 7) 2,032,985 2,371,328
----------------------------------------------------- ----------- ------------
Total non-current assets 10,133,276 11,670,440
----------------------------------------------------- ----------- ------------
Total assets $ 11,651,648 $ 13,482,306
----------------------------------------------------- ----------- ------------
EQUITY AND LIABILITIES
Current liabilities
Accounts payable and other liabilities (note 9) $ 817,473 $ 1,388,762
Current portion of financing facility (note 10) 7,450 6,947
Due to related parties (note 14) 2,761,889 4,022,216
----------------------------------------------------- ----------- ------------
Total current liabilities 3,586,812 5,417,925
Non-current liabilities
Non-current portion of financing facility (note 10) 26,128 31,122
Decommissioning liability (note 8) 543,948 637,988
Derivative financial liability (note 11(c)) 52,000 132,000
----------------------------------------------------- ----------- ------------
Total non-current liabilities 622,076 801,110
----------------------------------------------------- ----------- ------------
Total liabilities 4,208,888 6,219,035
----------------------------------------------------- ----------- ------------
Capital and reserves
Share capital (note 11(a)(b)) 36,331,577 33,960,190
Reserves 7,306,222 8,478,946
Deficit (36,195,039) (35,175,865)
----------------------------------------------------- ----------- ------------
Total equity 7,442,760 7,263,271
----------------------------------------------------- ----------- ------------
Total equity and liabilities $ 11,651,648 $ 13,482,306
----------------------------------------------------- ----------- ------------
The notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements.
Going concern (note 1)
Contingency (note 16)
Event after the reporting period (note 17)
Galantas Gold Corporation
Condensed Interim Consolidated Statements of Loss
(Expressed in Canadian Dollars)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2016 2015 2016 2015
------------------------------------------- ----------- ---------- ----------- -----------
Revenues
Gold sales $ 1,648 $ 13,774 $ 29,721 $ 14,897
Cost and expenses of operations
Cost of sales (note 13) 88,572 114,656 210,103 184,653
Depreciation (note 6) 42,732 49,881 90,283 102,174
------------------------------------------- ----------- ---------- ----------- -----------
131,304 164,537 300,386 286,827
------------------------------------------- ----------- ---------- ----------- -----------
Loss before general administrative and
other (incomes) expenses (129,656) (150,763) (270,665) (271,930)
------------------------------------------- ----------- ---------- ----------- -----------
General administrative expenses
Management and administration wages
(note 14) 165,550 130,548 343,493 261,167
Other operating expenses 22,590 11,715 44,147 45,487
Accounting and corporate 15,768 15,688 31,233 31,084
Legal and audit 97,064 19,098 147,466 40,908
Stock-based compensation (note
11(d)(i)(ii)) - 338,000 - 338,000
Shareholder communication and
investor relations 78,998 67,927 118,078 98,144
Transfer agent 7,609 8,653 9,232 10,633
Director fees (note 14) 8,250 10,500 13,250 15,500
General office 1,933 1,984 3,882 3,965
Accretion expenses (note 8) 2,916 2,976 6,018 5,942
Loan interest and bank charges (note
14) 18,828 17,763 38,818 35,554
------------------------------------------- ----------- ---------- ----------- -----------
419,506 624,852 755,617 886,384
Other (incomes) expenses
Gain on disposal of property, plant
and equipment (5,479) - (5,479) -
Unrealized gain on fair value of
derivative financial liability
(note 11(c)) (1,000) (95,000) (80,000) (103,000)
Foreign exchange loss 103,146 28,142 78,371 67,542
------------------------------------------- ----------- ---------- ----------- -----------
96,667 (66,858) (7,108) (35,458)
------------------------------------------- ----------- ---------- ----------- -----------
Net loss for the period $ (645,829) $ (708,757) $ (1,019,174) $ (1,122,856)
------------------------------------------- ----------- ---------- ----------- -----------
Basic and diluted net loss per share (note
12) $ (0.01) $ (0.01) $ (0.01) $ (0.01)
------------------------------------------- ----------- ---------- ----------- -----------
Weighted average number of common
shares outstanding - basic and diluted 114,263,285 87,297,154 110,765,807 84,533,844
------------------------------------------- ----------- ---------- ----------- -----------
The notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements.
Galantas Gold Corporation
Condensed Interim Consolidated Statements of Other Comprehensive (Loss) Income
(Expressed in Canadian Dollars)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2016 2015 2016 2015
-------------------------------------------- ----------- --------- ----------- -----------
Net loss for the period $ (645,829) $ (708,757) $ (1,019,174) $ (1,122,856)
Other comprehensive (loss) income
Items that will be reclassified subsequently
to profit or loss
Foreign currency translation differences (536,851) 254,815 (1,172,724) 509,214
-------------------------------------------- ----------- --------- ----------- -----------
Total comprehensive loss $ (1,182,680) $ (453,942) $ (2,191,898) $ (613,642)
-------------------------------------------- ----------- --------- ----------- -----------
The notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements.
Galantas Gold Corporation
Condensed Interim Consolidated Statements of Cash Flows
(Expressed in Canadian Dollars)
(Unaudited)
Six Months Ended
June 30,
2016 2015
------------------------------------------------------------------------------ ----------- -----------
Operating activities
Net loss for the period $ (1,019,174) $ (1,122,856)
Adjustment for:
Depreciation 90,283 102,174
Stock-based compensation (note 11(d)(i)(ii)) - 338,000
Interest expense 18,497 -
Foreign exchange 652,032 (179,018)
Gain on disposal of property, plant and equipment (5,479) -
Accretion expenses (note 8) 6,018 5,942
Unrealized gain on fair value of derivative financial liability (note 11(c)) (80,000) (103,000)
Non-cash working capital items:
Accounts receivable and prepaid expenses 69,080 (5,478)
Inventories 19,071 39,546
Accounts payable and other liabilities (571,289) 139,931
Due to related parties (342,972) 494,047
------------------------------------------------------------------------------ ----------- -----------
Net cash used in operating activities (1,163,933) (290,712)
------------------------------------------------------------------------------ ----------- -----------
Investing activities
Purchase of property, plant and equipment (361,780) (85,995)
Proceeds from sale of property, plant and equipment 34,548 -
Exploration and evaluation assets (22,045) (102,442)
------------------------------------------------------------------------------ ----------- -----------
Net cash used in investing activities (349,277) (188,437)
------------------------------------------------------------------------------ ----------- -----------
Financing activities
Proceeds of private placement 1,466,312 607,062
Share issue costs (30,777) (49,197)
Advances from related parties - 45,318
Proceeds from financing facility - 39,032
Repayment of financing facility (6,537) -
------------------------------------------------------------------------------ ----------- -----------
Net cash provided by financing activities 1,428,998 642,215
------------------------------------------------------------------------------ ----------- -----------
Net change in cash (84,212) 163,066
Effect of exchange rate changes on cash held in foreign currencies (121,131) 15,371
Cash, beginning of period 1,518,332 20,259
Cash, end of period $ 1,312,989 $ 198,696
------------------------------------------------------------------------------ ----------- -----------
Supplemental information
Shares issued to settle due to related parties (note 11(b)(iii)) $ 935,852 $ -
------------------------------------------------------------------------------ ----------- -----------
The notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements.
Galantas Gold Corporation
Condensed Interim Consolidated Statements of Changes in Equity
(Expressed in Canadian Dollars)
(Unaudited)
--------------------------------------------------------------
Reserves
----------- -------- -----------
Equity
settled Foreign
share-based currency
Share payments Warrant translation
capital reserve reserve reserve Deficit Total
--------------------- ----------- ----------- -------- ----------- ------------ ----------
Balance, December 31,
2014 $ 31,825,575 $ 5,471,109 $ - $ 1,133,221 $ (33,382,788) $ 5,047,117
Shares issued in
private placement
(note 11(b)(i)) 607,062 - - - - 607,062
Warrants issued
(note 11(b)(i)) (32,000) - - - - (32,000)
Share issue costs (49,197) - - - - (49,197)
Stock-based
compensation (note
11(d)(i)(ii)) - 338,000 - - - 338,000
Net loss and other
comprehensive income for the period - - - 509,214 (1,122,856) (613,642) --------------------- ----------- ----------- -------- ----------- ------------ ---------- Balance, June 30, 2015 $ 32,351,440 $ 5,809,109 $ - $ 1,642,435 $ (34,505,644) $ 5,297,340 --------------------- ----------- ----------- -------- ----------- ------------ ---------- Balance, December 31, 2015 $ 33,960,190 $ 5,809,109 $ 766,000 $ 1,903,837 $ (35,175,865) $ 7,263,271 Shares issued in private placement (note 11(b)(ii)) 1,466,312 - - - - 1,466,312 Share issue costs (30,777) - - - - (30,777) Common shares issued for debt (note 11(b)(iii)) 935,852 - - - - 935,852 Net loss and other comprehensive loss for the period - - - (1,172,724) (1,019,174) (2,191,898) --------------------- ----------- ----------- -------- ----------- ------------ ---------- Balance, June 30, 2016 $ 36,331,577 $ 5,809,109 $ 766,000 $ 731,113 $ (36,195,039) $ 7,442,760 --------------------- ----------- ----------- -------- ----------- ------------ ----------
The notes to the unaudited condensed interim consolidated financial statements are an integral part of these statements.
Galantas Gold Corporation Notes to Condensed Interim Consolidated Financial Statements Three and Six Months Ended June 30, 2016 (Expressed in Canadian Dollars) (Unaudited) ------------------------------------------------------------ 1. Going Concern
These unaudited condensed interim consolidated financial statements have been prepared on a going concern basis which contemplates that Galantas Gold Corporation (the "Company") will be able to realize assets and discharge liabilities in the normal course of business. In assessing whether the going concern assumption is appropriate, management takes into account all available information about the future, which is at least, but is not limited to, twelve months from the end of the reporting period. Management is aware, in making its assessment, of material uncertainties related to events or conditions that may cast significant doubt on the Company's ability to continue as a going concern. The Company's future viability depends on the consolidated results of the Company's wholly-owned subsidiary Cavanacaw Corporation ("Cavanacaw"). Cavanacaw has a 100% shareholding in both Omagh Minerals Limited ("Omagh") and Flintridge Resources Limited ("Flintridge") who are engaged in the acquisition, exploration and development of gold properties, mainly in Omagh, Northern Ireland. The Omagh mine has an open pit mine, which was in production and is reported as property, plant and equipment and an underground mine which is in the development stage and reported as exploration and evaluation assets. The production at the open pit mine was suspended in 2013.
The going concern assumption is dependent upon the ability of the Company to obtain the following:
a. Securing sufficient financing to fund ongoing operational activity and the development of
the underground mine.
b. Obtaining consent for an underground mine which is currently subject to a judicial review
process scheduled for September 2016.
Should the Company be unsuccessful in securing the above, there would be significant uncertainty over the Company's ability to continue as a going concern. The Company is currently in discussions with a number of potential financiers.
As at June 30, 2016, the Company had a deficit of $36,195,039 (December 31, 2015 - $35,175,865). Management is confident that it will be able to secure the required financing to enable the Company to continue as a going concern. However, this is subject to a number of factors including market conditions.
These unaudited condensed interim consolidated financial statements do not reflect adjustments to the carrying values of assets and liabilities, the reported expenses and financial position classifications used that would be necessary if the going concern assumption was not appropriate. These adjustments could be material.
2. Incorporation and Nature of Operations
The Company was formed on September 20, 1996 under the name Montemor Resources Inc. on the amalgamation of 1169479 Ontario Inc. and Consolidated Deer Creek Resources Limited. The name was changed to European Gold Resources Inc. by articles of amendment dated July 25, 1997. On May 5, 2004, the Company changed its name from European Gold Resources Inc. to Galantas Gold Corporation. The Company was incorporated to explore for and develop mineral resource properties, principally in Europe. In 1997, it purchased all of the shares of Omagh which owns a mineral property in Northern Ireland, including a delineated gold deposit. Omagh obtained full planning and environmental consents necessary to bring its property into production.
The Company entered into an agreement on April 17, 2000, approved by shareholders on June 26, 2000, whereby Cavanacaw, a private Ontario corporation, acquired Omagh. Cavanacaw has established an open pit mine to extract the Company's gold deposit near Omagh. Cavanacaw also has developed a premium jewellery business founded on the gold produced under the name Galántas Irish Gold Limited ("Galántas"). As at July 1, 2007, the Company's Omagh mine began production and in 2013 production was suspended. On April 1, 2014, Galántas amalgamated its jewelry business with Omagh.
Galantas Gold Corporation Notes to Condensed Interim Consolidated Financial Statements Three and Six Months Ended June 30, 2016 (Expressed in Canadian Dollars) (Unaudited) ------------------------------------------------------------ 2. Incorporation and Nature of Operations (Continued)
On April 8, 2014, Cavanacaw acquired Flintridge. Following a strategic review of its business by the Company during 2014 certain assets owned by Omagh were acquired by Flintridge.
The Company's operations include the consolidated results of Cavanacaw, and its wholly-owned subsidiaries Omagh, Galántas and Flintridge.
The Company's common shares are listed on the TSX Venture Exchange ("TSXV") and London Stock Exchange AIM under the symbol GAL. The primary office is located at 36 Toronto Street, Suite 1000, Toronto, Ontario, Canada, M5C 2C5.
3. Significant Accounting Policies
Statement of compliance
The Company applies International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") and interpretations issued by the International Financial Reporting Interpretations Committee. These unaudited condensed interim consolidated financial statements have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting. Accordingly, they do not include all of the information required for full annual financial statements.
The policies applied in these unaudited condensed interim consolidated financial statements are based on IFRSs issued and outstanding as of August 19, 2016 the date the Board of Directors approved the statements. The same accounting policies and methods of computation are followed in these unaudited condensed interim consolidated financial statements as compared with the most recent annual consolidated financial statements as at and for the year ended December 31, 2015, except for changes noted below. Any subsequent changes to IFRS that are given effect in the Company's annual consolidated financial statements for the year ending December 31, 2016 could result in restatement of these unaudited condensed interim consolidated financial statements.
Change in accounting policies
(i) IAS 1 - Presentation of Financial Statements was amended in December 2014 in order to clarify, among other things, that information should not be obscured by aggregating or by providing immaterial information, that materiality consideration apply to all parts of the financial statements and that even when a standard requires a specific disclosure, materiality considerations do apply. At January 1, 2016, the Company adopted this pronouncement and there was no material impact on the Company's unaudited condensed interim consolidated financial statements.
Galantas Gold Corporation Notes to Condensed Interim Consolidated Financial Statements Three and Six Months Ended June 30, 2016 (Expressed in Canadian Dollars) (Unaudited) ------------------------------------------------------------ 3. Significant Accounting Policies (Continued)
Recent accounting pronouncements
(i) IFRS 9 - Financial Instruments ("IFRS 9") was issued by the IASB in October 2010 and will replace IAS 39 -Financial Instruments: Recognition and Measurement ("IAS 39"). IFRS 9 uses an incurred loss approach to determine whether a financial asset is measured at amortized cost or fair value, replacing the expected loss approach in IAS 39. The approach in IFRS 9 is based on how an entity manages its financial instruments in the context of its business model and the contractual cash flow characteristics of the financial assets. In July 2014, the IASB issued the final version of IFRS 9. The final amendments made in the new version include guidance for the classification and measurement of financial assets and a third measurement category for financial assets, fair value through other comprehensive income. The standard also contains a new expected loss impairment model for debt instruments measured at amortized cost or fair value through other comprehensive income, lease receivables, contract assets and certain written loan commitments and financial guarantee contracts. Most of the requirements in IAS 39 for classification and measurement of financial
liabilities were carried forward unchanged to IFRS 9. IFRS 9 will be effective for accounting periods beginning January 1, 2018. The Company is currently assessing the impact of this pronouncement.
(ii) In May 2014, the IASB issued IFRS 15 - Revenue from Contracts with Customers ("IFRS 15") to replace IAS 18 -Revenue and IAS 11 - Construction Contracts and the related interpretations on revenue recognition. The new revenue standard introduces a single, principles based, five-step model for the recognition of revenue when control of a good or service is transferred to the customer. The five steps are identify the contract(s) with the customer, identify the performance obligations in the contract, determine transaction price, allocate the transaction price and recognize revenue when the performance obligation is satisfied. IFRS 15 also requires enhanced disclosures about revenue to help investors better understand the nature, amount, timing and uncertainty of revenue and cash flows from contracts with customers and improves the comparability of revenue from contracts with customers. IFRS 15 will be effective for annual periods beginning on or after January 1, 2018, with early adoption permitted.
(iii) IFRS 16 - Leases ("IFRS 16") was issued on January 13, 2016 to require lessees to recognize assets and liabilities for most leases. For lessors, there is little change to the existing accounting in IAS 17 - Leases.
The IASB issued its standard as part of a joint project with the Financial Accounting Standards Board ("FASB"). The FASB has not yet issued its new standard, but it is also expected to require lessees to recognize most leases on their statement of financial position.
The new standard will be effective for annual periods beginning on or after 1 January 2019. Early application is permitted, provided the new revenue standard, IFRS 15, has been applied, or is applied at the same date as IFRS 16.
Galantas Gold Corporation
Notes to Condensed Interim Consolidated Financial Statements
Three and Six Months Ended June 30, 2016
(Expressed in Canadian Dollars)
(Unaudited)
------------------------------------------------------------
4. Accounts Receivable and Prepaid Expenses
As at As at
June 30, December 31,
2016 2015
----------------------------------------------- -------- ------------
Sales tax receivable - Canada $ 7,210 $ 3,083
Valued added tax receivable - Northern Ireland 88,926 141,976
Accounts receivable 37,804 62,725
Prepaid expenses 46,639 41,875
----------------------------------------------- -------- ------------
$ 180,579 $ 249,659
----------------------------------------------- -------- ------------
Prepaid expenses includes advances for consumables and for construction of the passing bays in the Omagh mine.
The following is an aged analysis of receivables:
As at As at
June 30, December 31,
2016 2015
-------------------------- -------- ------------
Less than 3 months $ 98,389 $ 165,666
3 to 12 months - 1,837
More than 12 months 35,551 40,281
-------------------------- -------- ------------
Total accounts receivable $ 133,940 $ 207,784
-------------------------- -------- ------------
5. Inventories
As at As at
June 30, December 31,
2016 2015
------------------------ -------- ------------
Concentrate inventories $ 11,196 $ 13,265
Finished goods 13,608 30,610
------------------------ -------- ------------
$ 24,804 $ 43,875
------------------------ -------- ------------
Refer to note 13 for inventory movement.
Galantas Gold Corporation
Notes to Condensed Interim Consolidated Financial Statements
Three and Six Months Ended June 30, 2016
(Expressed in Canadian Dollars)
(Unaudited)
------------------------------------------------------------
6. Property, Plant and Equipment
Freehold Plant Mine
land and and Motor Office development
Cost buildings machinery vehicles equipment costs Total
----------- ---------- ---------- -------- --------- ----------- -----------
Balance,
December
31, 2014 $ 2,440,515 $ 5,159,328 $ 81,732 $ 111,292 $ 14,943,018 $ 22,735,885
Additions - 10,278 40,198 - 855,937 906,413
Foreign
exchange
adjustment 315,480 663,775 14,714 14,387 1,931,651 2,940,007
----------- ---------- ---------- -------- --------- ----------- -----------
Balance,
December
31, 2015 2,755,995 5,833,381 136,644 125,679 17,730,606 26,582,305
Additions - 7,222 34,069 - 320,489 361,780
Disposals - (35,435) - - - (35,435)
Foreign
exchange
adjustment (429,733) (905,218) (21,307) (19,597) (2,764,680) (4,140,535)
----------- ---------- ---------- -------- --------- ----------- -----------
Balance,
June 30,
2016 $ 2,326,262 $ 4,899,950 $ 149,406 $ 106,082 $ 15,286,415 $ 22,768,115
----------- ---------- ---------- -------- --------- ----------- -----------
Freehold Plant Mine
land and and Motor Office development
Accumulated
depreciation buildings machinery vehicles equipment costs Total
------------- ---------- ---------- -------- --------- ----------- -----------
Balance,
December 31,
2014 $ 1,969,052 $ 4,300,385 $ 75,803 $ 85,203 $ 9,217,987 $ 15,648,430
Depreciation 24,105 173,340 6,466 4,000 - 207,911
Foreign
exchange
adjustment 266,155 560,042 10,085 11,191 1,191,589 2,039,062
------------- ---------- ---------- -------- --------- ----------- -----------
Balance,
December 31,
2015 2,259,312 5,033,767 92,354 100,394 10,409,576 17,895,403
Depreciation 10,064 73,229 5,252 1,738 - 90,283
Disposals - - (6,366) - - (6,366)
Foreign
exchange
adjustment (353,254) (787,633) (14,905) (15,821) (1,623,133) (2,794,746)
------------- ---------- ---------- -------- --------- ----------- -----------
Balance, June
30, 2016 $ 1,916,122 $ 4,319,363 $ 76,335 $ 86,311 $ 8,786,443 $ 15,184,574
------------- ---------- ---------- -------- --------- ----------- -----------
Freehold Plant Mine
land and and Motor Office development
Carrying value buildings machinery vehicles equipment costs Total
-------------------- --------- --------- -------- --------- ----------- ----------
Balance, December
31, 2015 $ 496,683 $ 799,614 $ 44,290 $ 25,285 $ 7,321,030 $ 8,686,902
-------------------- --------- --------- -------- --------- ----------- ----------
Balance, June 30,
2016 $ 410,140 $ 580,587 $ 73,071 $ 19,771 $ 6,499,972 $ 7,583,541
-------------------- --------- --------- -------- --------- ----------- ----------
Galantas Gold Corporation
Notes to Condensed Interim Consolidated Financial Statements
Three and Six Months Ended June 30, 2016
(Expressed in Canadian Dollars)
(Unaudited)
------------------------------------------------------------
7. Exploration and Evaluation Assets
Exploration and evaluation assets are expenditures for the underground mining operations in Omagh. The proposed underground mine is dependent on the ability of the Company to obtain the necessary planning permission. On June 11, 2015, the Company announced that it had obtain planning consent for an underground gold mine at the Omagh site. However, the planning permission is subject to a judicial review which is scheduled for September 2016. The consent includes operating and environmental conditions.
Exploration
and
evaluation
Cost assets
---------------------------- -----------
Balance, December 31, 2014 $ 2,070,772
Additions 40,636
Foreign exchange adjustment 259,920
---------------------------- -----------
Balance, December 31, 2015 2,371,328
Additions 22,045
Foreign exchange adjustment (360,388)
---------------------------- -----------
Balance, June 30, 2016 $ 2,032,985
---------------------------- -----------
Exploration
and
evaluation
Carrying value assets
--------------------------- -----------
Balance, December 31, 2015 $ 2,371,328
--------------------------- -----------
Balance, June 30, 2016 $ 2,032,985
--------------------------- ----------- 8. Decommissioning Liability
The Company's decommissioning liability is a result of mining activities at the Omagh mine in Northern Ireland. The Company estimated its decommissioning liability at June 30, 2016 based on a risk-free discount rate of 1% (December 31, 2015 - 1%) and an inflation rate of 1.50% (December 31, 2015 - 1.50%) . The expected undiscounted future obligations allowing for inflation are GBP 330,000 and based on management's best estimate the decommissioning is expected to occur over the next 5 to 10 years. On June 30, 2016, the estimated fair value of the liability is $543,948 (December 31, 2015 - $637,988). Changes in the provision during the six months ended June 30, 2016 are as follows:
As at As at
June 30, December 31,
2016 2015
----------------------------------------------- -------- ------------
Decommissioning liability, beginning of period $ 637,988 $ 553,544
Accretion 6,018 12,341
Foreign exchange (100,058) 72,103
----------------------------------------------- -------- ------------
Decommissioning liability, end of period $ 543,948 $ 637,988
----------------------------------------------- -------- ------------
Galantas Gold Corporation
Notes to Condensed Interim Consolidated Financial Statements
Three and Six Months Ended June 30, 2016
(Expressed in Canadian Dollars)
(Unaudited)
------------------------------------------------------------
8. Decommissioning Liability (Continued)
As required by the Crown in Northern Ireland, the Company is required to provide a bond for reclamation related to the Omagh mine in the amount of GBP 300,000 (December 31, 2015 - GBP 300,000), of which GBP 300,000 was funded as of June 30, 2016 (GBP 300,000 was funded as of December 31, 2015) and reported as long-term deposit of $516,750 (December 31, 2015 - $612,210).
9. Accounts Payable and Other Liabilities
Accounts payable and other liabilities of the Company are principally comprised of amounts outstanding for purchases relating to exploration costs on exploration and evaluation assets, general operating activities, amounts payable for financing activities and professional fees activities.
As at As at
June 30, December 31,
2016 2015
--------------------------------------------- -------- ------------
Accounts payable $ 285,446 $ 756,682
Accrued liabilities 532,027 632,080
--------------------------------------------- -------- ------------
Total accounts payable and other liabilities $ 817,473 $ 1,388,762
--------------------------------------------- -------- ------------
The following is an aged analysis of the accounts payable and other liabilities:
As at As at
June 30, December 31,
2016 2015
--------------------------------------------- -------- ------------
Less than 3 months $ 300,787 $ 680,077
3 to 12 months 102,797 220,071
12 to 24 months 56,036 67,029
More than 24 months 357,853 421,585
--------------------------------------------- -------- ------------
Total accounts payable and other liabilities $ 817,473 $ 1,388,762
--------------------------------------------- -------- ------------
10. Financing Facility
Amounts payable on the long-term debt are as follow:
As at As at
June 30, December 31,
Interest 2016 2015
----------------------------------------- -------- -------- ------------
Financing facility, beginning of period $ 38,069 $ -
Financing facility received (GBP 19,900) 6.79% - 40,610
Less current portion (7,450) (6,947)
Repayment of financing facility (6,537) (2,541)
Foreign exchange adjustment 2,046 -
----------------------------------------- -------- -------- ------------
Financing facility - long term portion $ 26,128 $ 31,122
----------------------------------------- -------- -------- ------------
In June 2015, the Company obtained financing in the amount of GBP 19,900 for the purchase of a vehicle. The financing is for three years at interest of 6.79% per annum with monthly principal and interest payments of GBP 377 together with a final payment in June 2018 of GBP 9,383. The financing was secured on the vehicle.
Galantas Gold Corporation Notes to Condensed Interim Consolidated Financial Statements Three and Six Months Ended June 30, 2016 (Expressed in Canadian Dollars) (Unaudited) ------------------------------------------------------------ 11. Share Capital and Reserves a) Authorized share capital
At June 30, 2016, the authorized share capital consisted of an unlimited number of common and preference shares issuable in Series.
The common shares do not have a par value. All issued shares are fully paid.
No preference shares have been issued. The preference shares do not have a par value.
b) Common shares issued
At June 30, 2016, the issued share capital amounted to $36,331,577. The change in issued share capital for the periods presented is as follows:
Number of
common
shares Amount
---------------------------------------- ----------- -----------
Balance, December 31, 2014 76,697,155 $ 31,825,575
Shares issued in private placement (i) 10,599,999 607,062
Warrants issued (i) - (32,000)
Share issue costs - (49,197)
----------------------------------------- ----------- -----------
Balance, June 30, 2015 87,297,154 $ 32,351,440
----------------------------------------- ----------- -----------
Balance, December 31, 2015 107,297,154 $ 33,960,190
Shares issued in private placement (ii) 18,619,841 1,466,312
Share issue costs - (30,777)
Common shares issued for debt (iii) 11,883,835 935,852
----------------------------------------- ----------- -----------
Balance, June 30, 2016 137,800,830 $ 36,331,577
----------------------------------------- ----------- -----------
(i) On February 16, 2015, the Company closed a private placement of 10,599,999 common shares at GBP 0.03 ($0.05727) per common share for gross proceeds of GBP 316,667 ($607,062). Commissions of $36,424 were paid in connection with the placement and was included in the share issue costs. The agent also received 636,000 broker warrants. Each broker warrant can be exercised for one common share at an exercise price of GBP 0.045 for a period of 3 years.
The fair value of the 636,000 broker warrants was estimated at $32,000 using the Black-Scholes option pricing model with the following assumptions: expected dividend yield - 0%, expected volatility - 168.98%, risk-free interest rate -0.43% and an expected average life of 3 years. As a result of the exercise price of the broker warrants being denominated in a currency other than the functional currency, the broker warrants are considered a derivative financial liability.
Galantas Gold Corporation Notes to Condensed Interim Consolidated Financial Statements Three and Six Months Ended June 30, 2016 (Expressed in Canadian Dollars) (Unaudited) ------------------------------------------------------------ 11. Share Capital and Reserves (Continued) b) Common shares issued (continued)
(ii) On June 9, 2016, the Company closed a private placement of 18,619,841 common shares at $0.07875 per common share for gross proceeds of $1,466,312. A four month hold period applies to the shares which will expire on October 10, 2016.
The majority of the placement was taken up by Mr. Ross Beaty, who acquired 12,825,397 common shares.
(iii) On June 10, 2016, the Company issued 11,883,835 common shares as settlement of due to related parties of $935,852. Due to related parties consisted of an amount owing to Roland Phelps (President and Chief Executive Officer ("CEO").
c) Warrant reserve
The following table shows the continuity of warrants for the periods presented:
Weighted
average
Number of exercise
warrants price
--------------------------- ----------- --------
Balance, December 31, 2014 10,330,000 $ 0.18
Issued (note 11(b)(i)) 636,000 0.08
---------------------------- ----------- --------
Balance, June 30, 2015 10,966,000 $ 0.18
---------------------------- ----------- --------
Balance, December 31, 2015 30,966,000 $ 0.17
Expired (10,330,000) 0.17
---------------------------- ----------- --------
Balance, June 30, 2016 20,636,000 $ 0.16
---------------------------- ----------- --------
The following table reflects the actual warrants issued and outstanding as of June 30, 2016:
Fair value
Grant date June 30,
Number fair value Exercise 2016
Expiry date of warrants ($) price ($)
------------------ ----------- ---------- -------- ----------
July 24, 2016 20,000,000 766,000 0.16 766,000
February 16, 2018 636,000 32,000 0.045(1) 52,000
------------------- ----------- ---------- -------- ----------
20,636,000 798,000 818,000
------------------ ----------- ---------- -------- ----------
Galantas Gold Corporation
Notes to Condensed Interim Consolidated Financial Statements
Three and Six Months Ended June 30, 2016
(Expressed in Canadian Dollars)
(Unaudited)
------------------------------------------------------------
11. Share Capital and Reserves (Continued)
c) Warrant reserve (continued)
(1) Exercise price is in GBP. As a result of the exercise price of the warrants being denominated in a currency other than the functional currency, the warrants are considered a derivative financial liability. The warrants are revalued at each period end with any gain or loss in the fair value being record in the unaudited condensed interim consolidated statements of loss as an unrealized gain or loss on fair value of derivative financial liability.
On June 30, 2016, the fair value of the warrants, denominated in a currency other than the functional currency, was estimated using the Black-Scholes option pricing model with the following assumptions: expected dividend yield of 0%; expected volatility of 143%; risk free interest rate of 0.52%; and an expected life of 1.63 years. As a result, the fair value of the warrants was calculated to be $52,000 and the Company recorded an unrealized gain on fair value of derivative financial liability for the three and six months ended June 30, 2016 of $1,000 and $80,000, respectively (three and six months ended June 30, 2015 - unrealized gain of $95,000 and $103,000, respectively).
d) Stock options
The following table shows the continuity of stock options for the periods presented:
Weighted
average
Number of exercise
options price
--------------------------- --------- --------
Balance, December 31, 2014 940,000 $ 0.50
Granted (i)(ii) 3,700,000 0.11
---------------------------- --------- --------
Balance, June 30, 2015 4,640,000 $ 0.19
---------------------------- --------- --------
Balance, December 31, 2015 4,440,000 $ 0.17
Expired (50,000) 0.50
---------------------------- --------- --------
Balance, June 30, 2016 4,390,000 $ 0.17
---------------------------- --------- --------
(i) On June 1, 2015, 3,550,000 stock options were granted to directors, officers, consultants and key employees of the Company to purchase common shares at a price of $0.105 per share until June 1, 2020. The options vested immediately. The fair value attributed to these options was $324,000 and was expensed in the unaudited condensed interim consolidated statements of loss and credited to equity settled share-based payments reserve. During the three and six months ended June 30, 2016, included in stock-based compensation is $nil (three and six months ended June 30, 2015 - $324,000) related to the vested portion of these options.
The fair value of the options was estimated using the Black-Scholes option pricing model with the following assumptions: dividend yield - 0%; volatility - 134%; risk-free interest rate - 0.90% and an expected life of 5 years.
Galantas Gold Corporation Notes to Condensed Interim Consolidated Financial Statements Three and Six Months Ended June 30, 2016 (Expressed in Canadian Dollars) (Unaudited) ------------------------------------------------------------ 11. Share Capital and Reserves (Continued) d) Stock options (continued)
(ii) On June 13, 2015, 150,000 stock options were granted to a consultant of the Company to purchase common shares at a price of $0.105 per share until June 12, 2020. The options vested immediately. The fair value attributed to these options was $14,000 and was expensed in the unaudited condensed interim consolidated statements of loss and credited to equity settled share-based payments reserve. During the three and six months ended June 30, 2016, included in stock-based compensation is $nil (three and six months ended June 30, 2015 - $14,000) related to the vested portion of these options.
The fair value of the options was estimated using the Black-Scholes option pricing model with the following assumptions: dividend yield - 0%; volatility - 133%; risk-free interest rate - 1.01% and an expected life of 5 years.
The following table reflects the actual stock options issued and outstanding as of June 30, 2016:
Weighted average Number of
remaining Number of options Number of
Exercise contractual options vested options
Expiry date price ($) life (years) outstanding (exercisable) unvested
------------------ --------- ---------------- ----------- ------------- ---------
September 6, 2016 0.50 0.19 690,000 690,000 -
June 1, 2020 0.105 3.92 3,550,000 3,550,000 -
June 12, 2020 0.105 3.96 150,000 150,000 -
------------------- --------- ---------------- ----------- ------------- ---------
0.17 3.34 4,390,000 4,390,000 -
------------------ --------- ---------------- ----------- ------------- ---------
12. Net Loss per Common Share
The calculation of basic and diluted loss per share for the three and six months ended June 30, 2016 was based on the loss attributable to common shareholders of $645,829 and $1,019,174, respectively (three and six months ended June 30, 2015 - $708,757 and $1,122,856, respectively) and the weighted average number of common shares outstanding of 114,263,285 and 110,765,807, respectively (three and six months ended June 30, 2015 - 87,297,154 and 84,533,844, respectively) for basic and diluted loss per share. Diluted loss did not include the effect of 20,636,000 warrants (three and six months ended June 30, 2015 - 10,966,000) and 4,390,000 options (three and six months ended June 30, 2015 - 4,640,000) for the three and six months ended June 30, 2016, as they are anti-dilutive.
Galantas Gold Corporation
Notes to Condensed Interim Consolidated Financial Statements
Three and Six Months Ended June 30, 2016
(Expressed in Canadian Dollars)
(Unaudited)
------------------------------------------------------------
13. Cost of Sales
Three Months Ended Six Months Ended
June 30, June 30,
2016 2015 2016 2015
---------------------- -------- -------- -------- --------
Production wages $ 36,950 $ 27,676 $ 97,430 $ 52,208
Oil and fuel 15,081 8,088 33,350 16,887
Repairs and servicing 10,952 9,493 26,350 24,660
Equipment hire - 3,061 - 5,174
Royalties - 10,897 - 20,133
Other costs 26,009 8,401 39,443 18,551
---------------------- -------- -------- -------- --------
Production costs 88,992 67,616 196,573 137,613
Inventory movement (420) 47,040 13,530 47,040
---------------------- -------- -------- -------- --------
Cost of sales $ 88,572 $ 114,656 $ 210,103 $ 184,653
---------------------- -------- -------- -------- --------
14. Related Party Disclosures
Related parties include the Board of Directors, close family members, other key management individuals and enterprises that are controlled by these individuals as well as certain persons performing similar functions.
Related party transactions conducted in the normal course of operations are measured at the fair value and approved by the Board of Directors in strict adherence to conflict of interest laws and regulations.
(a) The Company entered into the following transactions with related parties:
Three Months Ended Six Months Ended
June 30, June 30,
Note 2016 2015 2016 2015
-------------------------------- ----- --------- -------- -------- -------
Interest on related party loans (i) $ 17,137 $ 17,012 $ 35,250 $ 33,622
--------------------------------- ------ --------- -------- -------- -------
(i) G&F Phelps Limited ("G&F Phelps"), a company controlled by a director of the Company, had amalgamated loans to the Company of $2,270,866 (GBP 1,318,354) (December 31, 2015 - $2,690,365 - GBP 1,318,354) included with due to related parties bearing interest at 2% above UK base rates, repayable on demand and secured by a mortgage debenture on all the Company's assets. Interest accrued on related party loans is included with due to related parties. As at June 30, 2016, the amount of interest accrued is $302,009 (GBP 175,332) (December 31, 2015 - $320,053 -GBP 156,835).
(ii) See note 11(b)(ii)(iii).
(b) Remuneration of key management of the Company was as follows:
Three Months Ended Six Months Ended
June 30, June 30,
2016 2015 2016 2015
------------------------- --------- -------- -------- --------
Salaries and benefits(1) $ 118,574 $ 121,420 $ 240,060 $ 237,708
Stock-based compensation - 109,521 - 109,521
------------------------- --------- -------- -------- --------
$ 118,574 $ 230,941 $ 240,060 $ 347,229
------------------------- --------- -------- -------- --------
(1) Salaries and benefits include director fees. As at June 30, 2016, due to directors for fees amounted to $97,000 (December 31, 2015 - $83,750) and due to key management, mainly for salaries and benefits accrued amounted to $92,014 (GBP 53,419) (December 31, 2015 - $928,048 - GBP 454,769), and is included with due to related parties.
Galantas Gold Corporation Notes to Condensed Interim Consolidated Financial Statements Three and Six Months Ended June 30, 2016 (Expressed in Canadian Dollars) (Unaudited) ------------------------------------------------------------ 14. Related Party Disclosures (Continued)
(c) As of June 30, 2016, Ross Beaty owns 28,825,397 common shares of the Company or approximately 20.92% of the outstanding common shares. Roland Phelps, CEO and director, owns, directly and indirectly, 33,356,750 common shares of the Company or approximately 24.21% of the outstanding common shares of the Company. The remaining 54.87% of the shares are widely held, which includes various small holdings which are owned by directors of the Company. These holdings can change at anytime at the discretion of the owner.
The Company is not aware of any arrangements that may at a subsequent date result in a change in control of the Company.
15. Segment Disclosure
The Company has determined that it has one reportable segment. The Company's operations are substantially all related to its investment in Cavanacaw and its subsidiaries, Omagh and Flintridge. Substantially all of the Company's revenues, costs and assets of the business that support these operations are derived or located in Northern Ireland. Segmented information on a geographic basis is as follows:
June 30, 2016 United Kingdom Canada Total ------------------- -------------- ---------- ---------- Current assets $ 311,137 $ 1,207,235 $ 1,518,372 Non-current assets 10,072,796 60,480 10,133,276 ------------------- -------------- ---------- ---------- Revenues $ 29,721 $ - $ 29,721 ------------------- -------------- ---------- ---------- December 31, 2015 United Kingdom Canada Total ------------------- -------------- ---------- ---------- Current assets $ 447,691 $ 1,364,175 $ 1,811,866 Non-current assets 11,609,887 60,553 11,670,440 ------------------- -------------- ---------- ---------- 16. Contingency
During the year ended December 31, 2010, the Company's subsidiary Omagh received a payment demand from Her Majesty's Revenue and Customs in the amount of $524,140 (GBP 304,290) in connection with an aggregate levy arising from the removal of waste rock from the mine site during 2008 and early 2009. The Company believes this claim is without merit. An appeal has been lodged and the Company's subsidiary Omagh intends to vigorously defend itself against this claim. A hearing date for the appeal has not yet been determined. No provision has been made for the claim in the unaudited condensed interim consolidated financial statements.
17. Event After the Reporting Period
On July 24, 2016, 20,000,000 warrants with an exercise price of $0.16 expired unexercised.
Addendum : Drilling Data
Hole Easting Northing Starting Intersect Dip Estimated Intersect Au Ag Pb Core
number azimuth width at TRUE vertical g/t g/t % loss
(m) intersect width depth %
(m)* (m)*
--------------- --------- --------- ---------
OML-DD-15-155 239749.4 370912.9 270(o) 21.6 53(o) 13.0 117.2 9.9 30.3 0.6 1
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
And 0.6 53.5(o) 0.4 148.4 1.2 2.4 0 0
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
And 0.8 53.5(o) 0.5 175.2 1.5 2.7 0 0
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
OML-DD-15-154 239568.9 370650.9 80(o) 1.2 55(o) 0.7 42.4 35.8 85.8 4.9 1
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
53.4
And 0.6 (o) 0.4 142.1 0.5 0.8 0.1 0
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
73.9
OML-DD-15-153 239574.9 370815.2 95(o) 0.7 (o) 0.2 77.4 12.6 6.3 0 0
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
75.6
And 5.6 (o) 1.4 212 1.6 2.2 0.1 1
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
OML-DD-152 288 61.3
(JA) 239803.7 370916.8 (o) 1.01 (o) 0.5 328.5 1.5 0.3 0 3
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
OML-DD-156 75 56.5
(JA) 239577.3 370815.8 (o) 0.9 (o) 0.5 98.7 8.1 22.1 1.5 0
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
56.5
And 2.8 (o) 1.5 101.1 1.8 33.7 0.2 0
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
OML-DD-157 80 69.8
(KL) 239567.9 370650.9 (o) 0.8 (o) 0.3 88 3 4 0 26
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
OML-DD-158 270 45.1
(JA) 239858.3 371082 (o) 0.6 (o) 0.4 17.9 2.7 2.3 0.5 0
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
49
And 0.4 (o) 0.3 133.3 2.2 0.8 0 0
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
OML-DD-159 75 57.8
(KY) 240007.8 370930.3 (o) 1 (o) 0.5 63.9 5.7 6.2 0 7
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
OML-DD-160 260 54.4
(KL) 239634.8 370742.5 (o) 2 (o) 1.2 74.1 3.2 7.1 0 0
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
OML-DD-161 270 46.1
(JA) 239724.7 371047 (o) 0.6 (o) 0.4 60.3 6.1 6.8 1.2 3
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
46
And 1 (o) 0.7 68.2 2.1 5.8 0 0
--------------- --------- --------- --------- ---------- ---------- ---------- ---------- ----- ----- ---- -----
260 coring deviation : missed
OML-DD-162 239624.1 370818.8 (o) NA target
--------------- --------- --------- --------- ---------- -------------------------------------------------------------
265 coring deviation : missed
OML-DD-163 239735.1 370980 (o) NA target
--------------- --------- --------- --------- ---------- -------------------------------------------------------------
NOTE: All figures have been rounded to one decimal place. Intersect depth is a maximum estimate to the top of the intersect.
The samples were taken by geological staff under the supervision of R. Phelps C.Eng MIMMM, (President & CEO, Galantas Gold Corporation), the Qualified Person (QP) for the program under NI 43-101 and who is also a "Qualified Person" as defined in the Note for Mining Oil & Gas Companies, June 2009, of the London Stock Exchange. Sampling methodology, security and verification followed standard procedures (April 2006) with standards, blanks and duplicates added at a frequency of 1 for every 20. The samples were analysed as follows: gold by fire assay and ICP-AES on 30g samples (fire assay and gravimetric finish for samples >10 ppm Au); other metals by ICP-MS and ICP-AES, at ALS Geochemistry Laboratories of Galway, Ireland, and were considered compliant with all requirements of International Standards ISO 17025:2005. All the samples reported herein are from drill core.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR SESFDDFMSESA
(END) Dow Jones Newswires
August 24, 2016 09:00 ET (13:00 GMT)
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