Final Results

 

TIDMGOA 
 
RNS Number : 0067I 
Gemstones of Africa Group PLC 
03 March 2010 
 

                                                                    3 March 2010 
 
                          Gemstones of Africa Group plc 
                         ("Gemstones" or the "Company") 
 
                Final Results for the year ended 31 December 2009 
 
 
Chairman's Statement 
I am pleased to report on the Group's accounts for the year ended 31 December 
2009. 
 
Overview: 
On 23 January 2009, the Company changed its name to Gemstones of Africa Group 
plc to reflect its investing strategy. 
 
Results and Financial Position: 
The Group's results for the year ended 31 December 2009 show a loss on ordinary 
activities before taxation of GBP182,483 (2008: loss GBP88,940). 
 
Net assets as at 31 December 2009 were GBP751,191, compared with GBP489,746 at 
the end of 2008, of which the Group had cash resources of GBP241,061 at 31 
December 2009. 
 
The Company did not pay or propose a dividend during the year. 
 
Change of Board and Investing Strategy: 
Since the 2008 year-end report, the Company has made two investments, both of 
which were reported to shareholders in my statement accompanying the financial 
statements for the year ended 31 December 2008: 
 
- a collaboration and option agreement with Obtala Resources Plc leading to a 
joint venture agreement on a group of emerald mining licences and a prospecting 
licence with ruby potential in Tanzania, Africa. 
 
- an Option Agreement with Javan Investments Company Limited, a private 
Tanzanian company, for two gemstone prospecting licences in Tanzania. The area 
is known to host sapphires, green and red garnets, and rubies, with a number of 
artisanal workings nearby. 
 
We were excited by the prospects for these licences, as they are known to occur 
in gem-bearing ground in a country which has demonstrated a commercial approach 
to foreign investment and offers reasonable infrastructure. However despite 
these investments made by the Company, we were not able to fully satisfy the 
requirements of the AIM Rules for Companies ("AIM Rules") that it had 
substantially implemented its investing strategy and therefore pursuant to Rule 
15 of the AIM Rules the Company's ordinary shares were suspended from trading on 
AIM with effect from 30 September 2009. The Company is required to complete a 
reverse takeover (as defined by the AIM Rules) by 31 March 2010. 
 
As a result of the AIM requirement to effect a substantial acquisition, the 
directors have been actively pursuing acquisition opportunities for the Company 
with the intention of identifying and pursuing a suitable acquisition target 
which would suit the overall strategy of developing the Company into a 
successful natural resources exploration business. The Company is currently in 
advanced negotiations to acquire a company with mineral exploration licences in 
energy commodities such as uranium and coal in Africa and will shortly be 
announcing this transaction and sending a circular to shareholders for their 
approval. 
 
The principal reason for the impending acquisition is that it further broadens 
the Company's strategy as set out above, while providing access to a region 
displaying very viable prospects in uranium and coal, supported by a Government 
that actively encourages active uranium and coal exploration. The shift towards 
uranium and coal exploration and development is based on the steady global 
growth in demand for energy in the foreseeable future, particularly with 
increasing demand from China and India, and reflects a move away from the more 
niche gemstone markets to the broader appeal of energy commodities. 
 
The board structure has been changed during the year. I was appointed as 
Non-Executive Chairman on 1 June 2009, and in July 2009, David Hargreaves and 
Nick Eastwood stepped down from the Board in order to pursue other interests.  I 
would like to thank David and Nick for their contribution and commitment since 
joining the Company. It is the intention of the Board that going forward we 
maintain a low cost base with the bulk of any funding being used for the 
projects on the ground. 
 
Prospects: 
The Directors believe that the natural resource sector is capable of delivering 
attractive levels of investment return and that there are a number of companies 
in this sector that would benefit from greater access to capital, quoted company 
profile and support. The Directors intend to pursue further investment 
opportunities and intend to fund them by using either cash or the issue by the 
Company of new securities, or a combination of both, and possibly through debt 
finance as the Directors consider appropriate. The Company aims to protect and 
preserve the environment and is committed to energy efficient operations. 
 
 
 
S. Rollason 
Chairman 
 
3 March 2010 
 
 
Further enquiries: 
 
+---------------------------------------+-----------------------------+ 
| Gemstones of Africa plc               |                             | 
| Simon Rollason, Non-Executive         |         Tel:  [phone] | 
| Chairman                              |                             | 
|                                       |                             | 
+---------------------------------------+-----------------------------+ 
| ZAI Corporate Finance Limited         |                             | 
| Dugald J. Carlean/ David Newton       |         Tel:  [phone] | 
+---------------------------------------+-----------------------------+ 
 
 
Group Income Statement for the year ended 31 December 2009 
 
 
+-----------------------------------------+-------+-----------+-----------+ 
|                                         |Notes  |      2009 |      2008 | 
+-----------------------------------------+-------+-----------+-----------+ 
|                                         |       |       GBP |       GBP | 
+-----------------------------------------+-------+-----------+-----------+ 
|                                         |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Administration expenses                 |       | (182,481) | (126,356) | 
+-----------------------------------------+-------+-----------+-----------+ 
| Other income                            |  2    |         - |    33,526 | 
+-----------------------------------------+-------+-----------+-----------+ 
|                                         |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Group operating loss                    |       | (182,481) |  (92,830) | 
+-----------------------------------------+-------+-----------+-----------+ 
|                                         |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Finance income                          |       |         - |     4,072 | 
+-----------------------------------------+-------+-----------+-----------+ 
| Finance costs                           |       |       (2) |     (182) | 
+-----------------------------------------+-------+-----------+-----------+ 
|                                         |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Finance income - net                    |       |       (2) |     3,890 | 
+-----------------------------------------+-------+-----------+-----------+ 
|                                         |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Loss on operations before taxation      |       | (182,483) |  (88,940) | 
+-----------------------------------------+-------+-----------+-----------+ 
|                                         |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Corporation tax expense                 |  3    |         - |         - | 
+-----------------------------------------+-------+-----------+-----------+ 
|                                         |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Loss for the year                       |       | (182,483) |  (88,940) | 
+-----------------------------------------+-------+-----------+-----------+ 
|                                         |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Comprising:                             |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Loss for the year from continuing       |       | (182,483) |  (95,233) | 
| operations                              |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Profit for the year from discontinued   |  4    |         - |     6,293 | 
| operations                              |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
|                                         |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Loss for the year                       |       | (182,483) |  (88,940) | 
+-----------------------------------------+-------+-----------+-----------+ 
|                                         |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Attributable to:                        |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Equity holders of the Company           |       | (182,483) |  (88,940) | 
+-----------------------------------------+-------+-----------+-----------+ 
|                                         |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Loss per Share (pence)                  |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
|                                         |       |           |           | 
+-----------------------------------------+-------+-----------+-----------+ 
| Basic and Diluted                       |  5    |   (0.01p) |   (0.02p) | 
+-----------------------------------------+-------+-----------+-----------+ 
 
No separate statement of comprehensive income is provided as all income and 
expenditure is disclosed above. 
Group Balance Sheet as at 31 December 2009 
 
 
+------------------------------------------+-------+-----------+-----------+ 
|                                          |Notes  |      2009 |      2008 | 
+------------------------------------------+-------+-----------+-----------+ 
|                                          |       |       GBP |       GBP | 
+------------------------------------------+-------+-----------+-----------+ 
| Non-current assets                       |       |           |           | 
+------------------------------------------+-------+-----------+-----------+ 
| Intangible assets                        |  6    |    19,082 |         - | 
+------------------------------------------+-------+-----------+-----------+ 
| Equity investments - available for sale  |  7    |   446,428 |         - | 
+------------------------------------------+-------+-----------+-----------+ 
|                                          |       |           |           | 
+------------------------------------------+-------+-----------+-----------+ 
|                                          |       |   465,510 |         - | 
+------------------------------------------+-------+-----------+-----------+ 
|                                          |       |           |           | 
+------------------------------------------+-------+-----------+-----------+ 
| Current assets                           |       |           |           | 
+------------------------------------------+-------+-----------+-----------+ 
| Trade and other receivables              |       |    66,134 |    16,390 | 
+------------------------------------------+-------+-----------+-----------+ 
| Cash and cash equivalents                |       |   241,061 |   491,421 | 
+------------------------------------------+-------+-----------+-----------+ 
|                                          |       |           |           | 
+------------------------------------------+-------+-----------+-----------+ 
|                                          |       |   307,195 |   507,811 | 
+------------------------------------------+-------+-----------+-----------+ 
|                                          |       |           |           | 
+------------------------------------------+-------+-----------+-----------+ 
| Current liabilities                      |       |           |           | 
+------------------------------------------+-------+-----------+-----------+ 
| Trade and other payables                 |       |    21,514 |    18,065 | 
+------------------------------------------+-------+-----------+-----------+ 
|                                          |       |           |           | 
+------------------------------------------+-------+-----------+-----------+ 
| Current assets less current liabilities  |       |   285,681 |   489,746 | 
+------------------------------------------+-------+-----------+-----------+ 
|                                          |       |           |           | 
+------------------------------------------+-------+-----------+-----------+ 
| Total assets less current liabilities    |       |   751,191 |   489,746 | 
| and net assets                           |       |           |           | 
+------------------------------------------+-------+-----------+-----------+ 
|                                          |       |           |           | 
+------------------------------------------+-------+-----------+-----------+ 
| Capital and reserves                     |       |           |           | 
+------------------------------------------+-------+-----------+-----------+ 
| Called-up share capital                  |       |   330,133 |   315,847 | 
+------------------------------------------+-------+-----------+-----------+ 
| Share premium account                    |       |   730,969 |   301,327 | 
+------------------------------------------+-------+-----------+-----------+ 
| Share option reserve                     |       |    33,441 |    33,441 | 
+------------------------------------------+-------+-----------+-----------+ 
| Retained earnings                        |       | (343,352) | (160,869) | 
+------------------------------------------+-------+-----------+-----------+ 
|                                          |       |           |           | 
+------------------------------------------+-------+-----------+-----------+ 
|                                          |       |   751,191 |   489,746 | 
+------------------------------------------+-------+-----------+-----------+ 
 
Group Statement of Changes in Equity for the year ended 31 December 2009 
 
 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
|                      |           |           |  Retained |   Share |          |           | 
|                      |     Share |     Share |  Earnings |  Option |   Merger |           | 
|                      |   Capital |   Premium |   Account | Reserve |  Reserve |     Total | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
|                      |       GBP |       GBP |       GBP |     GBP |      GBP |       GBP | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
|                      |           |           |           |         |          |           | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
| At 1 January 2008    |   641,796 |   624,066 | (940,059) |       - |   66,351 |   392,154 | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
|                      |           |           |           |         |          |           | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
| Cancellation of      | (177,713) |         - |   177,713 |       - |        - |         - | 
| deferred shares      |           |           |           |         |          |           | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
| Cancellation of      |         - | (624,066) |   624,066 |       - |        - |         - | 
| share premium        |           |           |           |         |          |           | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
| Capital reduction    | (399,903) |         - |         - |       - |        - | (399,903) | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
| Proceed from shares  |   251,667 |   348,333 |         - |       - |        - |   600,000 | 
| issued               |           |           |           |         |          |           | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
| Cost of shares       |         - |  (47,006) |         - |       - |        - |  (47,006) | 
| issued               |           |           |           |         |          |           | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
| On closure of        |         - |         - |    66,351 |       - | (66,351) |         - | 
| subsidiary           |           |           |           |         |          |           | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
| Share option reserve |         - |         - |         - |  33,441 |        - |    33,441 | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
| Loss for the year    |         - |         - |  (88,940) |       - |        - |  (88,940) | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
|                      |           |           |           |         |          |           | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
| At 1 January 2009    |   315,847 |   301,327 | (160,869) |  33,441 |        - |   489,746 | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
|                      |           |           |           |         |          |           | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
| Issue of share       |    14,286 |   432,142 |         - |       - |        - |   446,428 | 
| capital              |           |           |           |         |          |           | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
| Cost of shares       |         - |   (2,500) |         - |       - |        - |   (2,500) | 
| issued               |           |           |           |         |          |           | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
| Loss for the year    |         - |         - | (182,483) |       - |        - | (182,483) | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
|                      |           |           |           |         |          |           | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
| At 31 December 2009  |   330,133 |   730,969 | (343,352) |  33,441 |        - |   751,191 | 
+----------------------+-----------+-----------+-----------+---------+----------+-----------+ 
 
Group Cash Flow Statement for the year ended 31 December 2009 
 
 
+----------------------------------------------+------+-----------+-----------+ 
|                                              |      |      Year |      Year | 
|                                              |      |     ended |     ended | 
|                                              |      |        31 |        31 | 
|                                              |      |  December |  December | 
+----------------------------------------------+------+-----------+-----------+ 
|                                              |      |      2009 |      2008 | 
+----------------------------------------------+------+-----------+-----------+ 
|                                              |      |       GBP |       GBP | 
+----------------------------------------------+------+-----------+-----------+ 
| Cash flows from operating activities         |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
| Operating loss                               |      | (182,481) |  (92,830) | 
+----------------------------------------------+------+-----------+-----------+ 
| Profit on disposal of subsidiary             |      |         - |    11,974 | 
+----------------------------------------------+------+-----------+-----------+ 
| Share based payments                         |      |         - |    33,441 | 
+----------------------------------------------+------+-----------+-----------+ 
| Increase in trade and other receivables      |      |  (49,744) |  (10,439) | 
+----------------------------------------------+------+-----------+-----------+ 
| Decrease / (Increase) in trade and other     |      |     3,449 |  (45,954) | 
| payables                                     |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
|                                              |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
| Cash utilised in operations                  |      | (228,776) | (103,808) | 
+----------------------------------------------+------+-----------+-----------+ 
|                                              |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
| Finance income                               |      |         - |     4,072 | 
+----------------------------------------------+------+-----------+-----------+ 
| Finance costs                                |      |       (2) |     (182) | 
+----------------------------------------------+------+-----------+-----------+ 
|                                              |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
| Net cash outflow from operating activities   |      | (228,778) |  (99,918) | 
+----------------------------------------------+------+-----------+-----------+ 
|                                              |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
| Cash flows from financing activities         |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
| Proceeds from issue of shares                |      |         - |   600,000 | 
+----------------------------------------------+------+-----------+-----------+ 
| Capital reduction                            |      |         - | (399,903) | 
+----------------------------------------------+------+-----------+-----------+ 
| Share issue costs                            |      |   (2,500) |  (47,006) | 
+----------------------------------------------+------+-----------+-----------+ 
|                                              |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
| Net cash (outflow)/inflow from financing     |      |   (2,500) |   153,091 | 
| activities                                   |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
|                                              |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
| Cash flows from investing activities         |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
| Purchase of licences                         |      |  (19,082) |         - | 
+----------------------------------------------+------+-----------+-----------+ 
| Proceeds from disposal group classified as   |      |         - |         1 | 
| held-for-sale                                |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
|                                              |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
| Net cash (outflow)/inflow from investing     |      |  (19,082) |         1 | 
| activities                                   |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
|                                              |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
| Net (decrease)/increase in cash and cash     |      | (250,360) |    53,174 | 
| equivalents                                  |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
|                                              |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
| Cash and cash equivalents at beginning of    |      |   491,421 |   438,247 | 
| year                                         |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
|                                              |      |           |           | 
+----------------------------------------------+------+-----------+-----------+ 
| Cash and cash equivalents at end of year     |      |   241,061 |   491,421 | 
+----------------------------------------------+------+-----------+-----------+ 
 
 
 
Major non cash transactions 
During the year the Company issued share capital to the value of GBP446,428 to 
acquire its shareholding in Gemstones of Africa Limited. 
 
 
Notes to the Group Financial Statements for the year ended 31 December 2009 
 
1.       Group Accounting Policies 
 
Basis of preparation of group financial statements 
The Group's financial statements have been prepared in accordance with 
International Financial Reporting Standards (IFRS) as adopted by the European 
Union, IFRIC Interpretations and the parts of the Companies Act 2006 applicable 
to companies reporting under IFRS.  The Group's financial statements have also 
been prepared under the historical cost convention. 
 
The financial information set out above does not constitute the Company's 
statutory accounts for the years ended 31 December 2009 and 31 December 2008, 
but is derived from those accounts. Statutory accounts for 2008 have been 
delivered to the Registrar of Companies and those for 2009 will be delivered 
following the Company's Annual General Meeting. The Auditors have reported on 
those accounts; their reports were unqualified and did not contain statements 
under the Companies Act 1985, sections 237(2) or (3). 
 
2.       Other income 
+---------------------------------------------+------------+----------+ 
|                                             |       2009 |     2008 | 
+---------------------------------------------+------------+----------+ 
|                                             |            |          | 
|                                             |        GBP |      GBP | 
+---------------------------------------------+------------+----------+ 
|                                             |            |          | 
+---------------------------------------------+------------+----------+ 
| Profit on disposal of subsidiary            |          - |   11,974 | 
+---------------------------------------------+------------+----------+ 
| Loan waiver                                 |          - |   21,552 | 
+---------------------------------------------+------------+----------+ 
|                                             |            |          | 
+---------------------------------------------+------------+----------+ 
|                                             |          - |   33,526 | 
+---------------------------------------------+------------+----------+ 
 
3.       Taxation 
 
No UK corporation tax charge arises in respect of the year due to the trading 
losses incurred.  The Group has UK Corporation Tax losses available to be 
carried forward and used against trading profits arising in future periods of 
GBP574,571 (2008: GBP435,040). 
 
A deferred tax asset has not been recognised in respect of the tax losses 
carried forward due to the uncertainty that profits will arise against which the 
losses can be offset. 
 
The tax assessed for the year differs from the standard rate of corporation tax 
in the UK as follows: 
 
+---------------------------------------------+-----------+------------+ 
|                                             |      2009 |       2008 | 
+---------------------------------------------+-----------+------------+ 
|                                             |       GBP |        GBP | 
+---------------------------------------------+-----------+------------+ 
|                                             |           |            | 
+---------------------------------------------+-----------+------------+ 
| Loss on ordinary activities before tax      | (182,483) |   (88,940) | 
+---------------------------------------------+-----------+------------+ 
|                                             |           |            | 
+---------------------------------------------+-----------+------------+ 
| Expected tax charge/(credit) at effective   |           |            | 
| rate/(standard rate) of UK Corporation Tax  |           |            | 
+---------------------------------------------+-----------+------------+ 
| 21% (2008: 20.75%)                          |  (38,321) |   (18,455) | 
+---------------------------------------------+-----------+------------+ 
| Tax losses carried forward                  |    38,321 |     18,455 | 
+---------------------------------------------+-----------+------------+ 
|                                             |           |            | 
+---------------------------------------------+-----------+------------+ 
| Tax charge for the year                     |         - |          - | 
+---------------------------------------------+-----------+------------+ 
 
 
4.       Analysis of the result of discontinued operations, and the result 
recognised 
 
+----------------------------------------------------------+-------+----------+ 
|                                                          |  2009 |     2008 | 
+----------------------------------------------------------+-------+----------+ 
|                                                          |   GBP |      GBP | 
+----------------------------------------------------------+-------+----------+ 
|                                                          |       |          | 
+----------------------------------------------------------+-------+----------+ 
| Administration expenses                                  |     - | (39,758) | 
+----------------------------------------------------------+-------+----------+ 
| Other income                                             |     - |   46,135 | 
+----------------------------------------------------------+-------+----------+ 
|                                                          |       |          | 
+----------------------------------------------------------+-------+----------+ 
| Discontinued operating  profit                           |     - |    6,377 | 
+----------------------------------------------------------+-------+----------+ 
|                                                          |       |          | 
+----------------------------------------------------------+-------+----------+ 
| Finance income                                           |     - |        - | 
+----------------------------------------------------------+-------+----------+ 
| Finance costs                                            |     - |     (84) | 
+----------------------------------------------------------+-------+----------+ 
|                                                          |       |          | 
+----------------------------------------------------------+-------+----------+ 
| Finance income - net                                     |     - |     (84) | 
+----------------------------------------------------------+-------+----------+ 
|                                                          |       |          | 
+----------------------------------------------------------+-------+----------+ 
| Profit on discontinued operations before taxation        |     - |    6,293 | 
+----------------------------------------------------------+-------+----------+ 
| Corporation tax expense                                  |     - |        - | 
+----------------------------------------------------------+-------+----------+ 
|                                                          |       |          | 
+----------------------------------------------------------+-------+----------+ 
| Profit for the  year from discontinued operations        |     - |    6,293 | 
+----------------------------------------------------------+-------+----------+ 
 
5.       Earnings per share 
 
The basic loss per share is calculated by dividing the loss attributable to 
equity shareholders by the weighted average number of shares in issue.  As the 
Group is loss making, there was no dilutive effect from the share options 
outstanding during the year. 
 
+---------------------------------------------------+---------------+-------------+ 
|                                                   |          2009 |        2008 | 
+---------------------------------------------------+---------------+-------------+ 
|                                                   |           GBP |         GBP | 
+---------------------------------------------------+---------------+-------------+ 
|                                                   |               |             | 
+---------------------------------------------------+---------------+-------------+ 
| Net loss for the year attributable to ordinary    |     (182,483) |    (88,940) | 
| shareholders                                      |               |             | 
+---------------------------------------------------+---------------+-------------+ 
|                                                   |               |             | 
+---------------------------------------------------+---------------+-------------+ 
| The weighted average number of shares in the      |               |             | 
| period were:                                      |               |             | 
+---------------------------------------------------+---------------+-------------+ 
|                                                   |               |             | 
+---------------------------------------------------+---------------+-------------+ 
| Basic and dilutive ordinary shares                | 1,380,047,211 | 367,353,448 | 
+---------------------------------------------------+---------------+-------------+ 
|                                                   |               |             | 
+---------------------------------------------------+---------------+-------------+ 
| Basic and diluted loss per share                  |       (0.01p) |     (0.02p) | 
+---------------------------------------------------+---------------+-------------+ 
 
 
6.       Intangible exploration and evaluation assets 
+--------------------------------------------+------------+-----------+ 
|                                            |      Javan |     Total | 
|                                            |   licenses |           | 
+--------------------------------------------+------------+-----------+ 
|                                            |       2009 |      2009 | 
+--------------------------------------------+------------+-----------+ 
|                                            |        GBP |       GBP | 
+--------------------------------------------+------------+-----------+ 
|                                            |            |           | 
+--------------------------------------------+------------+-----------+ 
| Cost at 1 January 2009                     |          - |         - | 
+--------------------------------------------+------------+-----------+ 
| Purchase of mining licences                |     19,082 |    19,082 | 
+--------------------------------------------+------------+-----------+ 
|                                            |            |           | 
+--------------------------------------------+------------+-----------+ 
| Cost at 31 December 2009                   |     19,082 |    19,082 | 
+--------------------------------------------+------------+-----------+ 
 
Javan licences 
On 27 May 2009, the Company signed an option agreement with Javan Investments 
Company Limited, a private Tanzanian registered company for two prospecting 
licences in Tanzania. Under the terms of the option agreement Gemstones of 
Africa acquired an initial 25% interest in both licences for a consideration of 
US$15,000 per licence. 
 
The above values of intangible exploration assets acquired represent the cash 
consideration paid by the Group at the time of their acquisition. 
 
There were no triggers for carrying out an impairment review in the period. The 
Directors have considered the following factors: 
 
(a)     Geology and lithology on each licence as outlined in the most recent 
CPR's (Independent Competent Person's Reports from the mining and earth 
resources consultancy company, Wardell Armstrong International Limited); 
 
(b)     The expected useful lives of the licences and the ability to retain the 
licence interests when they come up for renewal; 
 
(c)     Comparable information for large mining and exploration companies in the 
vicinity of each of the licences; 
 
(d)     History of exploration success in the regions being explored; 
 
(e)     Local infrastructure; 
 
(f)      Climatic and logistical issues; and 
 
(g)     Geopolitical environment; 
 
7.       Equity investments - available for sale 
+----------------------------------------------------------------+---------+ 
|                                                                |     GBP | 
+----------------------------------------------------------------+---------+ 
|                                                                |         | 
+----------------------------------------------------------------+---------+ 
| Fair value                                                     |         | 
+----------------------------------------------------------------+---------+ 
| At 1 January 2009                                              |       - | 
+----------------------------------------------------------------+---------+ 
| Additions                                                      | 446,428 | 
+----------------------------------------------------------------+---------+ 
| Disposal                                                       |       - | 
+----------------------------------------------------------------+---------+ 
|                                                                |         | 
+----------------------------------------------------------------+---------+ 
| At 31 December 2009                                            | 446,428 | 
+----------------------------------------------------------------+---------+ 
 
On 13 March 2009, the Company entered into a collaboration and option agreement 
on a group of emerald mining licences in Tanzania, Africa, with Obtala and 
Obtala's subsidiary Mindex Invest Limited ("Mindex"). 
 
Under the terms of this agreement, Mindex agreed to transfer its 75 per cent 
interest in certain specified licences to Gemstones of Africa Limited.  The 
Company then acquired an initial 16.96 per cent of the share capital of 
Gemstones of Africa Limited in exchange for issuing ordinary shares the 
equivalent of five per cent of the Company's share capital to Obtala, totalling 
71,428,571 shares.  This equity, which equated to a fair value of GBP446,428 
(based on the closing price on 12 March 2009 of 0.625p per Ordinary Share), has 
been placed in Obtala treasury.  If within 24 months of acquiring the initial 
interest, the Company has incurred exploration costs of not less than US$75,000, 
then the Company has a right to a acquire a further 16.96 per cent of Gemstones 
of Africa Limited for $1. 
 
As at the year end Mindex had not yet transferred its 75 per cent interest in 
these licences to Gemstones of Africa Limited.  The Directors expect this 
transfer to be completed in the near future. 
 
8.       Related party transactions 
 
During the year ended 31 December 2009, the Group paid GBP35,000 (2008 GBP5,833) 
to Adler Shine LLP for the services of Rakesh Patel, director.  Rakesh Patel is 
a partner in Adler Shine LLP.  The Group also paid GBP8,250 (2008 GBPnil) to 
Adler Shine LLP for accounting services provided in the year. 
 
During the year ended 31 December 2009, the Company disposed of its subsidiary 
undertaking, Gemstones of Africa Limited to Obtala Resources Plc for a 
consideration of GBP100.  No gain or loss arose on the disposal.  Simon 
Rollason, director, is also a director of Obtala Resources Plc. 
 
As disclosed in note 14, the Company then acquired a 16.96 per cent shareholding 
in Gemstones of Africa Limited from Obtala.    The consideration for the 
acquisition was shares in the Company with a fair value of GBP446,428. 
 
During the year ended 31 December 2008 Mr. V. A. Stanzione, a former director 
and shareholder, signed a loan waiver agreement for GBP35,000 against an amount 
of GBP21,552 due to him at 31 December 2008 which was waived. 
 
9.       Dividend 
 
The directors have not recommended a dividend. 
 
10.     Copies of report and accounts 
 
Copies of the report and accounts will be posted to shareholders shortly, will 
be available from the Company's registered office, Aston House, Cornwall Avenue, 
London N3 1LF and will be available from the Company's website 
www.gemstonesofafrica.net. 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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