Red Rock Resources plc Unaudited half-yearly results (2440A)

Share Name	Share Symbol	Market	Type	Share ISIN	Share Description
Red Rock Resources Plc	LSE:RRR	London	Ordinary Share	GB00BYWKBV38	ORD 0.01P

	Price Change	% Change	Share Price	Bid Price	Offer Price	High Price	Low Price	Open Price	Shares Traded	Last Trade
	-0.0005	-1.04%	0.0475	0.045	0.05	0.0475	0.0475	0.0475	11,156,303	08:00:00

Industry Sector	Turnover	Profit	EPS - Basic	PE Ratio	Market Cap
Iron Ores	0	-2.67M	-0.0011	-0.45	1.24M

TIDMRRR

RNS Number : 2440A

Red Rock Resources plc

22 March 2017

 
 
                    22 March 2017 
 
               Red Rock Resources plc 
  Unaudited half-yearly results for the six months 
               ended 31 December 2016 
 
 
 
 Red Rock Resources plc ("Red Rock" or the "Company"), 
  the natural resource exploration and development 
  company with production interests in oil in Louisiana, 
  manganese in South Africa, and gold in South 
  America, announces its unaudited half-yearly 
  results for the six months ended 31 December 
  2016. 
 
 
 Chairman's statement 
 
 
 We present the company's interim report for the 
  six months to 31(st) December 2016. 
 
  Three months ago in our Annual Report we spoke 
  of the end of the downward cycle in the mineral 
  sectors, and the beginning of a recovery that 
  had been seen since the lows of January and February 
  2016. The cost reduction measures we were implementing, 
  another theme of the Annual Report, and the continuation 
  of the sector's good performance into the end 
  of the calendar year, have meant that the recovery 
  began to feed through into our published results 
  with these interim figures. 
 
  The published profit for the six month period 
  was GBP147,662 compared with a loss of GBP22,025 
  for the six months to 31(st) December 2015. Of 
  greater significance, the total comprehensive 
  profit for the period rose to GBP7,114,520 against 
  a loss of GBP109,477 in the comparable period 
  of the previous year. This reflected principally 
  a GBP6,927,699 partial reversal of prior year 
  impairments in the value of our 1.2% holding 
  in Jupiter Mines Ltd ("Jupiter") which also impacted 
  positively on shareholders' total equity which 
  rose to GBP16,026,755 from GBP8,627,235 at 30(th) 
  June 2016. 
 
  The reduction in our cost base saw a 39.1% year-on-year 
  reduction in administrative costs for the half 
  year against the year-before period, after a 
  24.4% year-on-year reduction in the year to June 
  2016, 
 
  Better manganese prices allowed the Tshipi é 
  Ntle mine in the Northern Cape province of South 
  Africa to announce in November 2016 a planned 
  distribution to its shareholders equivalent to 
  over half their capital investment in developing 
  the mine. The 49.9% joint venture shareholder, 
  Jupiter, in turn made a distribution to its shareholders: 
  our share of that, US$655,784.80 (approximately 
  GBP530,700), we received after the period-end 
  in March 2017. A further distribution is expected 
  this year. The distribution was carried out by 
  means of an "equal access buyback" at US$0.40 
  per share for 6% of the Jupiter shares held by 
  each shareholder, and received 98.01% acceptance. 
 
  At the 40c price, the value of our holding would 
  be US$10.93m (or approximately GBP8.85m), and 
  we would hope for (but might not achieve) an 
  equal or higher price-equivalent in a liquidity 
  event for the remainder of our holding, which 
  is anticipated for later this year. 
 
  Jupiter has since appointed Bank of America Merrill 
  Lynch to progress options for realising shareholder 
  value in 2017: this may include a relisting, 
  or a listing or sale of Tshipi é Ntle. 
 
  Given the disparity between our market capitalisation 
  on the stock market and the value of this single 
  high quality asset, and the strong possibility 
  of a liquidity event, our nearest and safest 
  way to preserve and increase shareholder value 
  will be to keep costs low and avoid where possible 
  new share issuance as we expect developments 
  at Jupiter to cause before long a natural narrowing 
  of the discount at which we trade. It might be 
  hard for a new investment to offer a return superior 
  to that obtainable from an existing investment. 
 
  Turning to our other projects , the new owner 
  of our former gold mining interests in Colombia 
  now has a C$24m market value and has broadened 
  its asset base. It announced in February 2017 
  that the second ball mill at the El Limón 
  mine is now installed and operational, supplementing 
  the first ball mill which gave us some problems 
  and has given the new owner further ones, requiring 
  more and lengthier refurbishment than expected. 
  In our current financial year we have received 
  three royalty payments amounting to US$26,607.16 
  from El Limón, covering the period to end-December, 
  and hope to get one more, at a considerably higher 
  level, as well as a US$50,000 interest payment, 
  before our books close on 30(th) June 2017. After 
  c1410 oz of gold production in calendar 2016, 
  the operators forecast a level of production 
  nearly ten times higher in 2017, with a 70%-plus 
  further increase in 2018, so that we look to 
  a substantial increase in our revenues from this 
  source. 
 
  Our third revenue-producing asset, our 20% working 
  interest in the LM20 and other oil and gas wells 
  in the Shoats Creek field in Louisiana, has failed 
  to produce the expected revenue stream to date 
  as it has not been operated satisfactorily. This 
  is a matter we shall now address, through a more 
  vigorous and proactive approach. We see no reason 
  why it should not perform better. 
 
  Apart from these three revenue and cash flow-producing 
  interests, and some minor ones, the Company retains 
  some exploration interests and assets in Kenya, 
  Ivory Coast and elsewhere. 
 
  In Kenya, the company is pursuing an action for 
  judicial review on behalf of itself and its local 
  partner, and until that is resolved is restricted 
  in its activities. This is a matter we shall 
  give renewed attention. The Company is also seeking 
  arbitration on its claim for conversion or early 
  repayment of the US$1m Promissory Note due in 
  May 2018 that was issued to it at the time of 
  the sale of the Colombian assets. 
 
  Red Rock expects to show continuing satisfactory 
  results in the second half of its financial year 
  and for the full year to 30(th) June 2017, and, 
  provided that commodity prices remain reasonably 
  stable, should see a pattern of strengthening 
  revenues in the following year. There is also 
  a strong possibility of one or more significant 
  liquidity events over coming months. The Company 
  therefore looks to the future with confidence. 
 
 
  Andrew Bell 
  Chairman 
  22 March 2017

Consolidated statement of financial position

as at 31 December 2016

 
                              Notes      31 December        31 December        30 June        30 June 
                                                2016               2015           2016           2015 
                                           Unaudited          Unaudited        Audited        Audited 
                                                 GBP                GBP            GBP            GBP 
 
 ASSETS 
 Non-current assets 
 Property plant 
  and equipment                 5             15,600                  -         17,400            266 
 Investments in 
  associates and 
  joint ventures                           2,458,409          3,924,891      2,459,638      3,968,878 
 Available for sale 
  financial assets              6          8,868,758          1,606,766      1,976,552      1,331,766 
 Exploration assets                          280,460                  -        280,460              - 
 Non-current receivables                   5,205,816          3,692,538      4,838,559      3,634,270 
 Total non-current 
  assets                                  16,829,043          9,224,195      9,572,609      8,935,180 
 
 Current assets 
 Cash and cash equivalents                    32,585            132,760         26,564         29,426 
 Trade and other 
  receivables                                996,151            765,863        939,554        661,152 
 Total current assets                      1,028,736            898,623        966,118        690,578 
 
 TOTAL ASSETS                             17,857,779         10,122,818     10,538,727      9,625,758 
 
 
 EQUITY AND LIABILITIES 
 Equity attributable 
  to owners of the 
  parent 
 Called up share 
  capital                       7          2,759,988          2,737,390      2,752,487      2,600,207 
 Share premium account                    25,553,288         24,678,302     25,275,788     24,285,503 
 Other reserves                            7,490,289            307,448        523,431        394,899 
 Retained earnings                      (19,751,847)       (19,769,046)   (19,910,736)   (19,747,630) 
                                                                         ------------- 
                                          16,051,718          7,954,094      8,640,971      7,532,979 
 
 Non-controlling 
  interest                                  (24,963)            (6,100)       (13,736)        (5,491) 
                                     ---------------  -----------------  -------------  ------------- 
 Total equity                             16,026,755          7,947,994      8,627,235      7,527,488 
 
 LIABILITIES 
 Current liabilities 
 Trade and other 
  payables                                 1,831,024          2,094,202      1,854,002      2,098,270 
 Short term borrowings                             -             80,622         57,490              - 
 Total current liabilities                 1,831,024          2,174,824      1,911,492      2,098,270 
 
 TOTAL EQUITY AND 
  LIABILITIES                             17,857,779         10,122,818     10,538,727      9,625,758

The accompanying notes form an integral part of these financial statements.

Consolidated statement of income