We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Customisable watchlists with full streaming quotes from leading exchanges, such as LSE, NASDAQ, NYSE, AMEX, Bovespa, BIT and more.
| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Kimcor | LSE:KIM | London | Ordinary Share | GB00B0TNHV95 | ORD 0.5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.325 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
Hot Features
Premium
RNS Number:3228K
KimCor Diamonds plc
20 December 2007
20 December 2007
KIMCOR DIAMONDS plc
(AIM:KIM)
INTERIM RESULTS
FOR THE PERIOD ENDING 30 SEPTEMBER 2007
AND OPERATIONAL UPDATE
KimCor Diamonds plc ("KimCor" or the "Company" or the "Group"), a diamond
producing and exploration company with properties in South Africa, is pleased to
announce the interim results for the period ended 30 September 2007.
HIGHLIGHTS
*Revenue for the period of £1.8m
*£3.4m of available funds, as at 30 September 2007
*Successful completion of the Dwyka Diamond Holdings ("DDH") transaction
*Successful completion of the Bellsbank expansion program
*Successful completion of the Central Sorting Facility expansion program
POST PERIOD HIGHLIGHTS
*On target to complete Newlands expansion program from 84,000 tonnes per
annum ("tpa") to 300,000tpa in early 2008
*Acquisition of an additional 15.5m tonnes of tailings from De Beers
Martyn Churchouse, CEO of KimCor, commented: "We are delighted with the DDH
transaction which was in line with KimCor's corporate strategy. We quickly
recognised the synergies that existed between KimCor and DDH, both in terms of
their respective asset bases and with regard to mining and management expertise.
This transaction will allow KimCor to focus on its expansion and development
programmes, supporting its aim to achieve an annualised output of 200,000
carats."
Enquiries:
KimCor Diamonds plc Tel: 020 7290 1400
Martyn Churchouse
Strand Partners Limited Tel: 020 7409 3494
Warren Pearce
Bishopsgate Communications Ltd Tel: 020 7562 3350
Nick Rome
Chairman's Statement and Operations Update
On behalf of KimCor's Board of Directors, I am pleased to present our unaudited
interim results for the six months ended 30 September 2007, as well as an
operational update for the period to 12 December 2007.
The financial period has been dominated by the acquisition of the South African
diamond mining and exploration assets of Dwyka Resources Limited ("Dwyka") which
constituted a Reverse Takeover for the purposes of the AIM rules ("RTO" or
"Acquisition").
The Acquisition has bolstered production from Kimcor's original Bellsbank dump
processing operation by the addition of two producing underground mines, an
alluvial mining operation and a further large-scale dump processing project.
This offers the Group a diversified suite of diamond types and qualities which
will provide for the changing demands in the diamond market. The total number of
carats attributable to the Group's mine portfolio has risen from 200,000 carats
to 2.2 million carats, based on inferred and indicated resources.
Feasibility studies undertaken by KimCor prior to the RTO identified
opportunities to expand production at the various operations and to improve
profitability. As a result, the Board has approved a capital development
programme, building upon the previous development and investment made by Dwyka,
to implement the recommended expansion and plant upgrades with the objective of
producing 200,000 carats per annum from combined mine production.
The Acquisition also included the Supermix Industrial Division, which
manufactures ready mix concrete, bricks and paving blocks, utilising aggregate
produced from the Nooitgedacht mining operation This Industrial Division's
building products business is the largest of its type in the Northern Cape.
OPERATIONS UPDATE
Bellsbank Tailings Operation
The expansion programme has been successfully completed on schedule and under
budget with annual production to rise from 480,000tpa up to 900,000tpa from the
start of 2008. Recoverable grades will be maintained at 4.3 carats per hundred
tonnes ("cpht"). A new dense media separation unit ("DMS") has been installed
and production is steadily increasing towards the design capacity.
Newlands Underground Mine
Extensive mine development and plant modification has been taking place in order
to provide access to kimberlite ores to achieve production of 84,000tpa of
underground ore and the treatment a further 300,000tpa of tailings. The project
is on schedule for completion by the end of February 2008. During the expansion
programme, the mine and plant has continued operating.
On completion of the project, production is expected to recover approximately
19,320 carats per annum from underground ores and 21,000 carats per annum from
the reprocessing of tailings.
Blaauwbosch Underground Mine
Underground development has continued with the aim of opening up access to
additional resources that will increase annual production from 36,000tpa to
132,000tpa. It is expected that this will result in diamond production rising
from 10,000 carats per annum to 40,000 carats per annum.
The development requirements are extensive and the programme is scheduled for
completion in July 2008. The upgrading of the processing plant will also take
place within this time with production levels expected to be at 5,000 tonnes per
month during this time.
SMI4 Tailings Project
The recent acquisition of an additional 15.5 million tonnes of tailings material
from De Beers will expand the SMI4 dump processing project to a total resource
base of approximately 19 million tonnes. The capital project recently approved
by the Board will see initial production increased to 1.2 million tpa by March
2008 and a further increase to 1.8 million tpa by August 2008. This will provide
a production capacity of 108,000 carats per annum over a 9 year project life.
Planned plant design modifications are expected to reduce operating costs from
US$5 per tonne down to below US$3 per tonne. Plant upgrade commissioning is
scheduled to commence by the end of February 2008.
Nooitgedacht Alluvial Mine
Nooitgedacht has a long history of diamond production and retains the record for
the largest recorded alluvial diamond recovered in South Africa, the "Venter
Diamond", weighing over 711 carats.
KimCor will increase production significantly at Nooitgedacht. The existing
240,000tpa capacity processing plant will remain in operation and, in parallel;
the Group will engage two contractors in the first quarter of 2008 to mine and
process an additional 1.2 million tpa of diamond bearing gravels. At an average
recoverable grade of 1 cpht and an average sales price of over US$500 per carat,
the mine is projected to produce approximately 14,400 carats and US$7.2 million
in revenue annually. The contractors will bear all operating costs and receive
85% of gross sale proceeds with the Group receiving the remaining 15%. The
percentage received by the Group will increase to over 25% of gross proceeds
realised in respect of the more valuable stones recovered.
The Group will continue to operate the mine's aggregate plant providing raw
material to the Group's Industrial Division, and, at the same time, cover a
proportion of the alluvial diamond mining costs.
Central Sorting Facility
The Central Sorting Facility located at the Group's Kimberley regional office
has been expanded to facilitate the increases in production across all projects,
and can now process over 30 tonnes of concentrate per day.
Industrial Division
The Northern Cape is experiencing a rise in demand for construction products,
which is reflected in the Industrial Division's improving performance, supplying
18,000 cubic meters of ready mix cement during this half year period. Supply to
the Kimberly prison will continue through 2008, and the construction of a new
mall begins in January 2008.
EXPLORATION UPDATE
Tanzania De Beers Joint Venture
In Tanzania the Group has commenced a bulk sampling programme designed to
evaluate two delineated kimberlite pipes with a combined surface area of over 9
hectares. Under the terms of its agreement with De Beers, KimCor, through its
Tanzanian subsidiary, plans to mine and process a total of 18,000 tonnes of
kimberlite in 2008 so as to provide recoverable grade estimates for the two
structures.
Bosele
The Bosele Prospecting Right, located close to the Group's Bellsbank operation,
comprises a series of kimberlite bearing fissures that form the strike extension
to fissures currently being exploited at the nearby Messina mine. In addition,
the licence contains an unusual large structure tentatively described as a
lamproite. Bulk sampling of the structure resulted in the recovery of diamonds
and the Group is currently planning an exploration drilling programme to
commence in the fourth quarter of 2008.
Bosele offers scope in the long-term to utilise the existing Bellsbank plant to
process kimberlite ores recovered at Bosele.
Koffiefontein
A drilling programme designed to outline the different phases of kimberlite and
possible extensions to the structure, is scheduled for the fourth quarter of
2008.
Outlook
The work undertaken during this period to increase and diversify KimCor's asset
base and to strengthen its management team leaves KimCor well placed at the end
of 2007 to achieve its target annualised output of 200,000 carats. I would like
to take this opportunity to thank our staff for their commitment and hard work
throughout the year, and our shareholders for their continued support.
Consolidated income statement for six months ended 30 September 2007
Note Six months Six months
to 30 to 30
September September
2007 2006
Unaudited Unaudited
£'000 £'000
Revenue 1,835 1,631
Cost of sales (2,522) (1,988)
-------- --------
Gross profit/(loss) (687) (357)
Administrative expenses (3,655) (1,804)
Other operating income 99 1,359
-------- --------
Loss from operations (4,243) (802)
Finance income 7 13
Finance expense (100) (63)
-------- --------
Loss for the period before taxation (4,336) (852)
Tax - -
-------- --------
Loss for the period after taxation (4,336) (852)
attributable to equity holders of the
parent
-------- --------
Basic and diluted loss per share 5 (3.06)p (0.01)p
-------- --------
Consolidated Balance sheet as at 30 September 2007
30 September 30 June 2007
2007
Unaudited Unaudited
£'000 £'000
ASSETS
Non - current assets
Property, plant and equipment 2,835 2,402
Mining properties 5,364 -
Prospecting rights 115 -
Other non-current receivables 175 163
-------- --------
8,489 2,565
-------- --------
Current assets
Inventories 266 189
Trade and other receivables 1,654 306
Cash and cash equivalents 3,421 177
-------- --------
5,341 672
-------- --------
Total assets 13,830 3,237
-------- --------
LIABILITIES
Current liabilities
Trade and other payables 1,522 765
Current tax payable 12 -
Accruals 262 -
Provisions 453 298
-------- --------
2,249 1,063
-------- --------
Non-Current liabilities
Borrowing 1,697 11,937
Deferred tax liability 1,097 -
-------- --------
2,794 11,937
-------- --------
Total liabilities 5,043 13,000
-------- --------
Equity attributable to equity holders
of the parent
Share capital issued 1,341 -
Share premium reserve 7,034 -
Cumulative translation adjustments (517) 2,631
Warrant reserve 157 -
Retained earnings and other reserves 772 (12,373)
-------- --------
Equity attributable to equity holders 8,787 (9,742)
of the parent
-------- --------
Minority interest - (21)
Total equity and liabilities 13,830 3,237
-------- --------
Consolidated Statement of Changes in Equity for three months ended 30 September
2007
Share Share Warrant Retained Translation Total
premium reserve earnings Reserve
capital and
other
reserves
£'000 £'000 £'000 £'000 £'000 £'000
Balance as - - - (12,373) 2,631 (9,742)
of 1 July
2007
Loss for the - - - (1,741) - (1,741)
period
Foreign
exchange on
translation
of foreign
operation - - - - (3,148) (3,148)
Reverse -
takeover 1,341 7,034 157 14,886 23,418
Balance as 1,341 7,034 157 772 (517) 8,787
of 30
September
2007
Consolidated Cash flow statement for six months ended 30 September 2007
Six months Six months
to 30 to 30
September September
2007 2006
Unaudited Unaudited
£'000 £'000
CASH FLOW FROM OPERATING ACTIVITIES
Loss before tax: (4,336) (851)
Adjustments for:
Finance expense 100 63
Finance income (7) (13)
Depreciation, amortisation and impairment 2,935 47
Provision for rehabilitation 10 30
Income from sales of investment - (1,195)
Foreign exchange difference 793 1,005
-------- --------
Operating loss before changes in working capital (505) (914)
Increase/(decrease)in other payables 335 221
(Increase)/decrease in other receivables (188) (311)
(Increase)/decrease in inventories (169) 34
-------- --------
Net cash flow from operating activities (527) (971)
INVESTING ACTIVITIES
Purchase of property, plant and (27) (362)
equipment
Interest received - 2
Cash held in subsidiary at the date of 85 -
acquisition
-------- --------
58 (360)
FINANCING ACTIVITIES
Proceeds from issue of ordinary shares 3,234 -
Proceeds from loan raised 648 629
Repayment of the loan (42) -
Interest paid (72) -
-------- --------
3,768 629
-------- --------
NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS 3,299 (702)
DURING THE PERIOD
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE 122 879
PERIOD
-------- --------
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD 3,421 177
-------- --------
Notes forming part of the interim financial statements
1. CORPORATE INFORMATION
KimCor Diamonds plc (the "Company") is a diamond mining and exploration company
incorporated in England and Wales on 21 March 2005 for the purpose of developing
diamond mining assets and projects primarily in South Africa.
2. BASIS OF PREPARATION
These primary statements and selected notes comprise the unaudited interim
consolidated results of the Company and its subsidiaries ("the Group") for the
six months ended 30 September 2007.
The audited financial statements for the period ended on 31 March 2007 were
prepared in accordance with International Financial Reporting Standards (IFRSs
and IFRIC interpretations), as adopted by the European Union and with those
parts of the Companies Act 1985 applicable to companies preparing their accounts
under IFRS.
These primary statements and selected notes reflect the acquisition of 100% of
issued share capital of Dwyka Diamonds Holdings Limited ("DDH"). As a result of
this transaction, described as a reverse takeover, shareholders of DDH acquired
control of the Company. Accordingly, this transaction has been accounted for as
an acquisition of the Company by DDH (See note 6). The interim financial
statements therefore represent a continuation of the financial statements of
DDH, the legal subsidiary acquired. These consolidated financial statements
reflect the results of the operations and cash flows of DDH for all periods
presented and include those of the Company subsequent to the date of the reverse
takeover on 21 September 2007. The consolidated balance sheet at 30 June 2007
and the consolidated income statement and cash flow statement for the 6 months
ended 30 September 2006 are that of DDH.
The comparative period figures for the income statement are for the six months
ended 30 September 2006. For the balance sheet the figures are at 31 June 2007
and are not audited.
The unaudited interim consolidated results of the Group presented in this
interim announcement have been prepared on the basis of the DDH's accounting
policies as set out in Part 4 of the Admission Document (dated 21 August 2007)
and which are consistent with the accounting policies applied for the financial
statements for the year ended 31 March 2007. These accounting policies are
expected to be adopted for the following year end. As permitted the Group has
chosen not to adopt IAS 34 Interim Financial Reporting.
The interim financial statements for 6 months ended 30 September 2007 are
unaudited and within the meaning of the section 240 of the Companies Act 1985,
such accounts do not constitute full statutory accounts of the Group.
3. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
Estimates and judgments are continually evaluated and are based on historical
experience and other factors, including expectations of future events that may
have a financial impact on the entity and that are believed to be reasonable
under the circumstances.
The Group makes estimates and assumptions concerning the future. The resulting
accounting estimates will, by definition, seldom equal the related actual
results. The estimates and assumptions that have a significant risk of causing a
material adjustment to the carrying amounts of assets and liabilities within the
next financial year are discussed below.
(i)Reverse Takeover ("RTO")
Reverse takeover accounting for the acquisition of DDH (note 6);
(ii) Income taxes
The Group is subject to income taxes in various jurisdictions where it has
foreign operations. Significant judgment is required in determining the
worldwide provision for income taxes. There are many transactions and
calculations undertaken during the ordinary course of business for which the
ultimate tax determination is uncertain. The Group recognises liabilities for
anticipated tax audit issues based on estimates of whether additional taxes will
be due. Where the final tax outcome of these matters is different from the
amounts that were initially recorded, such differences will impact the current
and deferred tax provisions in the period in which such determination is made.
(iii) Exploration, evaluation and mining properties
The Group's main activity is exploration and evaluation for, and mining of
diamonds. The nature of mining and exploration activities are such that it
requires interpretation of complex and difficult geological models in order to
make an assessment of the size, shape, depth and quality of resources and their
anticipated recoveries. The economic, geological and technical factors used to
estimate mining viability may change from period to period. In addition
exploration activities by their nature are inherently uncertain. Changes in all
these factors can impact exploration and mining asset carrying values,
provisions for rehabilitation and the recognition of deferred tax assets.
(iv) Rehabilitation obligations
The Group estimates the future removal costs of mine operations disturbances at
the time of installation of the assets and commencement of operations. In most
instances, removal of assets occurs some years into the future. This requires
judgmental assumptions regarding removal date, the extent of reclamation
activities required, the engineering methodology for estimating cost, future
removal technologies in determining the removal cost and asset specific discount
rates to determine the present value of these cash flows.
4. SIGNIFICANT ACCOUNTING POLICES
Significant accounting policies are set out below:
Basis of consolidation
(i) Subsidiaries
The consolidated financial statements incorporate the financial statements of
the Group and entities controlled by the Group (its subsidiaries).
Subsidiaries are all those entities (including special purpose entities) over
which the Group has the power to govern the financial and operating policies,
generally accompanying a shareholding of more than one-half of the voting
rights. The existence and effect of potential voting rights that are currently
exercisable or convertible are considered when assessing whether the Group
controls another entity.
Subsidiaries are fully consolidated from the date on which control is
transferred to the Group. They are de-consolidated from the date that control
ceases.
The purchase method of accounting is used to account for the acquisition of
subsidiaries by the Group.
Intercompany transactions, balances and unrealised gains on transactions between
Group companies are eliminated. Unrealised losses are also eliminated unless the
transaction provides evidence of the impairment of the asset transferred.
Accounting policies of subsidiaries have been changed where necessary to ensure
consistency with the policies adopted by the Group.
Minority interests in the results and equity of subsidiaries are shown
separately in the consolidated income statement and balance sheet respectively.
(ii) Associates
Associates are all entities over which the Group has significant influence but
not control, generally accompanying a shareholding of between 20 per cent. and
50 per cent. of the voting rights. Investments in associates are accounted for
using the equity method of accounting, after initially being recognised at cost.
The Group's share of its associates' post-acquisition profits or losses is
recognised in the income statement, and its share of post-acquisition movements
in reserves is recognised in reserves. The cumulative post acquisition movements
are adjusted against the carrying amount of the investment. Dividends receivable
from associates reduce the carrying amount of the investment.
When the Group's share of losses in an associate equals or exceeds its interest
in the associate, including any other unsecured receivables, the Group does not
recognise further losses, unless it has incurred obligations or made payments on
behalf of the associate.
Unrealised gains on transactions between the Group and its associates are
eliminated to the extent of the Group's interest in the associates. Unrealised
losses are also eliminated unless the transaction provides evidence of an
impairment of the asset transferred.
Business combinations
Business combinations are accounted for using the purchase method.
The cost of the acquisition is measured at the aggregate of the fair values at
the date of exchange, of assets given, liabilities incurred or assumed, and
equity instruments issued by the Group in exchange for control of the acquiree,
plus any costs directly attributable to the business combination. The acquiree's
identifiable assets, liabilities and contingent liabilities that meet the
conditions for recognition under IFRS 3 are recognised at their fair value at
the acquisition date.
Any excess of the cost of acquisition over the fair values of the identifiable
net assets acquired is recognised as goodwill. Any deficiency of the cost of
acquisition below the fair values of the identifiable net assets acquired (i.e.
discount on acquisition) is credited to the income statement in the period of
acquisition.
Foreign currency
(i) Functional and presentation currency
Items included in the financial statements of each of the Group's entities are
measured using the currency of the primary economic environment in which the
entity operates ('the functional currency'). The consolidated financial
statements are presented in Pound Sterling.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using
the exchange rates prevailing at the dates of the transactions. Foreign exchange
gains and losses resulting from the settlement of such transactions and from the
translation at year-end exchange rates of monetary assets and liabilities
denominated in foreign currencies are recognised in the income statement.
(iii) Group companies
On consolidation, the assets and liabilities of the Group's overseas operations
are translated at exchange rates prevailing on the balance sheet date. Goodwill
and fair value adjustments arising on the acquisition of a foreign entity are
treated as assets and liabilities of the foreign entity and translated at the
closing rate.
Income and expense items are translated at the average exchange rates for the
period unless exchange rates fluctuate significantly. Exchange differences
arising, if any, are classified as equity and transferred to the Group's
translation reserve. Exchange differences recognised in the income statement of
group entities' separate financial statements on the translation of long-term
monetary items forming part of the group's net investment in the overseas
operation concerned are reclassified to the foreign exchange reserve. On
disposal of a foreign operation, the cumulative exchange differences recognised
in the foreign exchange reserve relating to that operation up to the date of
disposal are transferred to the income statement as part of the profit or loss.
Property, plant and equipment
Items of property, plant and equipment are initially recognised at cost. As well
as the purchase price, cost includes directly attributable costs and estimated
present value of any future costs of dismantling and removing items. The
corresponding liability is recognised within provisions. Property, plant and
equipment is stated at cost less accumulated depreciation and any impairment
losses.
Land is shown at cost and is not depreciated Depreciation is provided on all
other assets to write down the cost, less residual value, by equal instalments
over their estimated useful lives as follows:
- Buildings 10-20 years
- Machinery 5-12 years
- Vehicles 3-5 years
- Furniture, fittings and equipment 3-8 years
The depreciation charge for each period is recognised in the income statement,
unless it is included in the carrying amount of another asset. Subsequent
expenditure relating to an item of property, plant and equipment is capitalised
when it is probable that future economic benefits from the use of asset will be
increased. All other subsequent expenditure is recognised as an expense in the
period in which it is incurred.
Repairs and maintenance which neither materially add to the value of assets nor
appreciably prolong their useful lives are charged against income. The gain or
loss arising from the de-recognition of an item of property, plant and equipment
is included in the income statement when the item is de-recognised. The gain or
loss arising from the de-recognition of an item of property, plant and equipment
is determined as the difference between the net disposal proceeds, if any, and
the carrying amount of the item. The carrying values of property, plant and
equipment are reviewed for impairment when events or changes in circumstances
indicate the carrying value may not be recoverable. Assets under construction
are carried at cost less any recognised impairment. Borrowing costs attributable
to assets under construction are recognised as an expense as incurred.
Mining properties
Mining properties are stated at cost of acquisition and/or accumulation of
exploration, evaluation and development costs in respect of areas of interest in
which mining has commenced less accumulated amortisation and any impairment
loss.
When further development expenditure is incurred in respect of a mining property
after the commencement of production, such expenditure is carried forward as
part of the mine property only when substantial future economic benefits are
thereby established, otherwise such expenditure is classified as part of the
cost of production.
Amortisation is provided on a unit-of-production basis so as to write off the
cost in proportion to the depletion of the proved and probable mineral
resources.
Evaluation and exploration costs
Exploration and evaluation costs include expenditure incurred in connection with
the exploration for and the evaluation of economically recoverable diamond
resources. These costs include costs of acquisition, exploration and appraisal
costs and technical overheads directly associated with those projects. The
company's policy with respect to exploration and evaluation expenditure is to
use the "area of interest" method. Under this method, exploration and evaluation
costs are carried forward on the following basis:
(i) Each area of interest is considered separately when deciding whether and to
what extent to carry forward or write off exploration and evaluation costs;
(ii) Exploration and evaluation costs related to an area of interest may be
carried forward provided that rights to tenure of the area of interest are
current and provided further that one of the following conditions are met:
*such costs are expected to be recouped through successful development and
exploitation of the area of interest or alternatively, by its sale; or
*exploration and/or evaluation activities in the area of interest have not
yet reached a stage which permits a reasonable assessment of the existence
or otherwise of economically recoverable reserves and active and significant
operations in relation to the area are continuing.
(iii) The carrying values of exploration and evaluation costs are reviewed by
directors where results of exploration and/or evaluation of an area of interest
are sufficiently advanced to permit a reasonable estimate of the costs expected
to be recouped through successful development and exploitation of the area of
interest or by its sale. Expenditure in excess of this estimate is written off
to the income statement in the year in which the review occurs;
(iv) When development of an area of interest is complete and production
commences, all exploration, evaluation and development costs carried forward as
an asset (including the cost of extractive rights acquired) are transferred to
mining properties. Development costs related to an area of interest are carried
forward as an asset to the extent that they are expected to be recovered either
through sale or successful exploitation; and
(v) The carrying values of exploration, evaluation and development expenditure
are carried forward and amortised over the expected useful life of each project.
Inventories
Inventories, which include rough diamonds, finished goods and raw materials, are
stated at the lower of cost and estimated net realisable value. Cost is
determined on a first-in, first-out basis and comprises direct labour and direct
materials. Net realisable value is the estimated selling price in the ordinary
course of business, less the cost of completion and selling expenses.
Provisions
Provisions are recognised when the consolidated entity has a legal, equitable or
constructive obligation to make a future sacrifice of economic benefits to other
entities as a result of past transactions or other past events, it is probable
that a future sacrifice of economic benefits will be required and a reliable
estimate can be made of the amount of the obligation.
Rehabilitation and restoration costs
The Group has obligations for site restoration related to its mining properties.
The Group establishes restoration provisions for future mine closure costs when
a legal or constructive obligation exists based on the present value of the
future cash flows required to satisfy the obligations. Provisions expected to be
utilised in the coming 12 months on areas with lives of less than one year are
accounted for in the income statement of the Group. Provisions not expected to
be utilized in the coming 12 months are added to the capital cost of the related
mining assets in mine properties and amortised over the resource life. The
provision is accreted to its future value over the resource life through a
charge to borrowing costs.
Changes in the estimated cost of rehabilitation is applied on a prospective
basis with an adjustment to capital cost
5. BASIC AND DILUTED LOSS PER SHARE
Basic loss per share amounts are calculated by dividing net loss for the period,
attributable to ordinary equity holders of the parent, by the weighted average
number of ordinary shares outstanding during the period.
Diluted earnings per share amounts are calculated by dividing the net loss
suffered by equity shareholders of the parent by the weighted average number of
ordinary shares outstanding during the period plus the weighted average number
of ordinary shares that would be issued on the conversion of all the dilutive
potential ordinary shares into ordinary shares.
The loss per share for the 6 months period ended 30 September 2006 is calculated
using the number of shares issued to the shareholders of DDH during the RTO, in
line with the guidance in IAS 33 Earnings per share.
In line with IFRS 3, following the RTO the equity structure of the Group
reflects the equity of the legal parent, including the shares issued by it to
effect the business combination. In the six months period ended 30 September
2007, the weighted average number of shares has been calculated as follows:
* Number of ordinary shares from beginning of period to date of RTO is the
number of shares issued by the Company to the owners to DDH; and
* From acquisition date to end of period the number of shares is the
actual number of shares of the Company outstanding during the period.
The following reflects the loss and share data used in the basic and diluted
earnings per share computations:
Six months Six months
to 30 to 30
September September
2007 2006
£'000 £'000
Net loss attributable to equity holders of the 4,336 852
parent
--------- ---------
No diluted loss per share has been calculated as the Group has incurred a loss
for the period.
Six months Six months
to 30 to 30
September September
2007 2006
Number Number
Basic weighted average number of shares 141,699,667 134,383,718
--------- ---------
The only transaction involving ordinary shares or potential ordinary shares
between the reporting date and the date of completion of these financial
statements is described in note 7 below.
6. REVERSE TAKEOVER
On 21 September 2007 the Company became the legal parent of DDH. As part of this
combination Dwyka Resources Limited, the sole shareholder of DDH, became the
owner of 50.09% of the enlarged share capital. Accordingly, and considering the
size of the companies involved, the substance of the combination was that DDH
acquired the Company in a reverse acquisition.
Under the requirements of the Companies Act 1985 it would normally be necessary
for the Company's consolidated accounts to follow the legal form of the business
combination. In that case, the pre-combination results would be those of the
Company and DDH would be included only in relation to its performance from 21
September 2007. However this would show the combination as the acquisition of
DDH by the Company and would, in the opinion of the directors, fail to give a
fair view of the substance of the business combination. Accordingly, the
directors have adopted reverse acquisition accounting as the basis of the
consolidation.
On 21 September DDH acquired 50.09% of the issues share capital of the Company
for the consideration of £5,039,608 representing directly attributable costs of
£0.7 million and 67,191,859 ordinary shares of the Company in issue immediately
prior to the takeover for which the fair value was determined by directors as
the placing price of 6.5p of the new ordinary shares issued and proposed for
placing on AIM at the same date.
The provisional fair value of the net assets acquired was determined by the
directors, having regard to reports by independent experts.
A loss incurred in the period to 30 September 2007 by the Company and its
subsidiaries is not significant and did not materially impact the consolidated
operating loss of the Group. Had the acquisition occurred on 1 April 2007, the
estimated operating loss would have been £807,996 higher at £5,143,719 for the
six months period ended 30 September 2007.
Book and fair values of the net assets at date of acquisition, were as follows:
Book Fair value Fair value
values adjustments to group
£'000 £'000 £'000
Mining properties 1,763 3,601 5,364
Property, plant and 527 - 527
equipment
Other long-term assets 224 360 584
Inventories 4 - 4
Cash and short-term 85 - 85
deposits
Other receivables 855 - 855
Trade and other (923) - (923)
creditors
Deferred tax liability (412) (1,044) (1,456)
-------- --------- --------
Net assets 2,123 2,917 5,040
-------- --------- --------
Goodwill arising on -
acquisition
--------
5,040
--------
Discharged by:
Fair value of shares 4,367
Acquisition costs 673
--------
5,040
-------
No identifiable goodwill has arisen in respect of this transaction. The surplus
of value of the consideration over the other separable net assets and
liabilities of the acquired group has been attributed to the mining properties
and represents their estimated fair value of as at the date of acquisition of 21
September 2007.
7. POST BALANCE SHEET EVENTS
Grant of Share options
On 1 October 2007, as envisaged in the admission document dated 21August 2007,
the Company granted 4,250,000 options to certain key employees and consultants
under the Company's Share Option Plan. All of the options granted have a strike
price of 7.75p.
The vesting periods of the options issued is one-third per annum from the date
of grant, and options not vested will lapse on the individual ceasing to be an
employee, director or consultant (as applicable). Any options vested will lapse
if not exercised within 3 months of the date of any such cessation.
8. INTERIM REPORT
Copies of this interim report for the six months ended 30 September 2007 will be
available from the offices of KimCor Diamonds plc, 18 Upper Brook Street,
London, W1K 7PU, and on the Company's website www.kimcordiamonds.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR ILFSRFFLALID
1 Year Kimcor Diamonds Chart |
1 Month Kimcor Diamonds Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions
