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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Lithic Metals (SEE LSE:AFNR) | LSE:LMY | London | Ordinary Share | BMG5504H1051 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 2.375 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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RNS Number : 8938K
Lithic Metals and Energy Limited
31 December 2008
Lithic Metals and Energy Limited
("Lithic" or the Company")
Interim results for the 6 months ended 30 September 2008
Lithic (AIM code: LMY), the AIM-quoted African nickel and uranium exploration company, today announces its interim results for the six
months ended 30th September 2008.
MANAGING DIRECTORS' REPORT
I have pleasure in presenting the unaudited accounts of Lithic for the six months ended 30 September 2008. During this period, Lithic
has established its exploration activities across its Zambia, Togo and Mozambique assets, making significant progress on all fronts.
Significant Events
* Commencement of Zambian uranium joint venture with Zambezi Resources Limited in April.
* Completion of 36,000 line km programmes of airborne radiometric surveys of Zambian uranium JV licences.
* Discovery of over 40 high priority uranium targets on Zambian properties.
* Commencement of exploration activities on Togo properties.
* Completion of airborne geophysical surveys over majority of Togo licences.
* Discovery of broad areas of greater than 1% nickel mineralisation on Mt Haito licence, Togo.
* Successful negotiation for 100% interest in Mavita nickel project, Mozambique from BHP Billiton.
* Completion of VTEM survey over Mavita nickel project.
In Togo, the Company has completed the initial evaluation of its licences through the undertaking of comprehensive geophysical surveys,
data acquisition and review and field activities.
This work has lead to the discovery of significant nickel saprolite mineralisation at the Kpot?roject, where nickel values greater than
1% are now confirmed in test pitting over an area exceeding 1600m x 650m. Geophysical data, field mapping and extensional test pitting
indicate potential to significantly extend the known area of nickel mineralisation through additional exploration.
In Zambia, extensive geophysical surveys over a large proportion of our uranium joint venture licences have identified over 40 high
priority uranium anomalies. Field evaluation of these targets has commenced, with the results from the majority of field samples submitted
for analysis still pending.
On the Mavita licence in Mozambique, the Company negotiated out of clawback and offtake provisions in the Memorandum of Understanding
with BHP Billiton and now holds the licences 100% unencumbered. The Company has just completed a detailed VTEM geophysical survey over the
identified ultramafic lithology in the search for nickel sulphides.
Current Positioning
The current turbulent market conditions and significant decline in all commodity prices has, in the directors' opinion, resulted in a
rapid sentiment shift against junior exploration companies. It is globally recognised that poor market conditions will make access to
ongoing funding for junior explorers extremely difficult in the short term at least, prompting the Company's board of directors to initiate
a comprehensive review of operations and forward expenditure, with a view of ensuring effective long term management and allocation of its
capital resources.
As a result, the Company has moved decisively to stabilise its investment portfolio, significantly reducing its exploration expenditure
across all assets. Corporate focus has now shifted to preserving cash resources, and concentrating on the identification of natural resource
opportunities capable of generating significant returns for shareholders.
Financial Information
The Company and it subsidiaries report a loss for the half year ended 30 September 2008 of £305,977 (compared to a loss of £588,212 for
the six months ended 30 September 2007).
No dividend was paid or declared during the period.
The basic loss and diluted loss per share for the period was £0.01.
For more information please contact:
Jim Kerr David Youngman/ Katy Laurence Reed
Mitchell
Lithic Metals & Energy Ltd WH Ireland Threadneedle Communications
Tel: +61 (0) 428 948 552 Tel: +44 (0) 161 832 Tel: +44 (0) 20 7936 9696
2174
Consolidated Statement of Comprehensive Income
For the six months ended 30 September 2008
Unaudited Unaudited six months Audited
Note six months ended ended year
ended
September 2008 September 2007 March
2008
£ £ £
Total revenue 2 222,982 33,791 150,380
Other expenses 2 (528,959) (622,003) (987,075)
Deficit before income tax (305,977) (588,212) (836,695)
Income tax expense - - -
Deficit after tax for the (305,977) (588,212) (836,695)
half-year
Other comprehensive income:
Exchange differences on 158,570 (19,533) (11,856)
translation of foreign
entities
Income tax effect - - -
Total other comprehensive 158,570 (19,533) (11,856)
income
TOTAL COMPREHENSIVE
INCOME/(DEFICIT) (147,407) (607,745) (848,551)
- attributable to owners
Earnings per share:
- Basic and diluted deficit 3 (0.01) (0.01) (0.01)
per share
Consolidated Statement of Cash Flows
for the six months ended 30 September 2008
Unaudited Unaudited Audited
six months ended six months ended Year
ended
September 2008 September 2007 March
2008
£ £ £
Cash flows from operating
activities (534,578) (194,118) (487,249)
Payments to suppliers and 99,690 33,791 150,380
employees 122,893 - -
Interest received
Management fee received
Net cash utilised by operating (311,995) (160,327) (336,869)
activities
Cash flows from investing
activities (541,301) (60,441) (325,495)
Payments for mineral - - (114,318)
exploration activities (886,213) (33,647) (205,742)
Purchase of RRCC Limited (156,662) (4,983) (131,149)
Payments for business
development projects
Payments for property, plant
and equipment
Net cash utilised by investing (1,584,176) (99,071) (776,704)
activities
Cash flows from financing
activities - 1,992,500 6,000,000
Proceeds from issue of shares - - (226,524)
Share issue costs
Net cash generated from - 1,992,500 5,773,476
financing activities
Net increase/(decrease) in (1,896,171) 1,733,102 4,659,903
cash and cash equivalents 4,920,809 260,906 260,906
Cash and cash equivalents at
beginning of the period
Cash and cash equivalents at 3,024,639 1,994,008 4,920,809
end of the year - (Note 6)
Consolidated Statement of Financial Position
at 30 September 2008
Note Unaudited Unaudited Audited
September 2008 September 2007 March 2008
£ £ £
ASSETS
Non-current assets
Property, plant and equipment 288,824 16,119 124,882
Mineral properties 3,724,883 1,551,136 3,083,930
Other assets 4 1,126,067 33,637 204,839
5
Total non current assets 5,139,774 1,600,892 3,413,651
Current assets
Trade and other receivables 130,620 15,903 52,725
Prepayments 133,321 7,609 46,681
Cash and cash equivalents 3,024,638 1,994,008 4,920,809
6
Total current assets 3,288,579 2,017,520 5,020,215
Total assets 8,428,353 3,618,412 8,433,866
EQUITY AND LIABILITIES
Current liabilities
Trade and other payables 317,000 94,055 283,934
Provisions 36,370 4,930 19,213
Total current liabilities 353,370 98,985 303,147
Total liabilities 353,370 98,985 303,147
Equity
Issued capital 8 1,522,972 753,741 1,522,972
Share premium account 8 7,838,278 3,826,533 7,838,278
Options and Warrants Reserve 9 272,492 109,699 180,821
Foreign currency translation 9 113,251 (52,996) (45,319)
reserve 9 (1,672,010) (1,117,550) (1,366,033)
Accumulated deficit
Total equity 8,074,983 3,519,427 8,130,719
Total equity and liabilities 8,428,353 3,618,412 8,433,866
Statement of Changes in Equity
for the six months ended 30 September 2008
Unaudited
September 2008
£
Issued Capital
Opening balance as at 1 April 2008 1,522,972
Issued during the period -
Closing balance as at 30 September 2008 1,522,972
Share Premium Reserve
Opening balance as at 1 April 2008 7,838,278
Premium on shares issued during the period -
Closing balance as at 30 September 2008 7,838,278
Options & Warrants Reserve
Opening balance as at 1 April 2008 180,821
Recognition of share-based payments 91,671
Closing balance as at 30 September 2008 272,492
Accumulated Deficit
Opening balance as at 1 April 2008 (1,366,033)
Deficit for the period (305,977)
Closing balance as at 30 September 2008 (1,672,010)
Foreign Currency Translation Reserve
Opening balance as at 1 April 2008 (45,319)
Exchange differences arising on translation of foreign 158,570
operations
Closing balance as at 30 September 2008 113,251
Total of shareholders equity at 30 September 2008 8,074,983
Notes to the Annual Financial Statements
1. Key accounting policies
Lithic Metals and Energy Limited (hereafter "Lithic" or the "Company") is a company registered and domiciled in Bermuda whose principal
activities comprise minerals exploration and development for the benefit of shareholders.
The Company's registered office is:
Canon's Court
22 Victoria Street
Hamilton HM 12
Bermuda
The financial statements incorporate the principal accounting policies set out below. Accounting policies of the subsidiaries are
consistent with those of the holding company.
Statement of compliance
The Group financial statements are prepared in accordance with International Financial Reporting Standards (IFRS) adopted by the
International Accounting Standards Board (IASB) and interpretations issued by the International Financial Reporting Interpretations
Committee of the IASB.
Basis of preparation
The Group financial statements are prepared on the historical cost basis. Cost is based on the fair values of the consideration given in
exchange for assets. All amounts are presented in Pounds Sterling, unless otherwise noted.
Principles of consolidation
The consolidated financial statements incorporate the assets and liabilities of Lithic and its subsidiaries (hereafter the "Group" or
"Consolidated Entity") as at 30 September 2008, and the results of its subsidiaries for the six month period then ended. Subsidiaries are
those entities over which the Group has the power to govern the financial and operating policies, generally accompanying a shareholding of
more than fifty percent of the voting rights so as to obtain benefits from its activities. The existing and effect of potential voting
rights which 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. Inter-company transactions,
balances and unrealised gains on transactions between Group companies are eliminated on consolidation. 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 (when relevant) in the results are shown separately in the consolidated income statement and balance sheet
respectively.
The Group financial statements incorporate the assets, liabilities and results of operations of the Company and its subsidiaries
acquired and disposed of during a financial period. These assets, liabilities and results are included from the effective dates of
acquisition to the effective dates of disposal. Where necessary, the accounting policies of subsidiaries are changed to ensure the
consistency with the policies adopted by the Group.
Mineral exploration expenditure
Exploration and evaluation costs incurred by the Group are accumulated separately for each area of interest. Such costs comprise net
direct costs and an appropriate portion of related overhead costs, but do not include general overheads or administrative costs that do not
have a specific association with a particular area of interest. Exploration and evaluation costs are carried forward to the extent that:
a) such costs are expected to be recouped through the successful development and utilisation of the area of interest, or alternatively
by its sale; or
b) exploration and evaluation activities in the area of interest have not reached a stage which permits a reasonable assessment of the
existence or otherwise of economically recoverable reserves.
In the event that an area of interest is abandoned or if the Directors consider the costs incurred exceed the area of interest's
recoverable amount, accumulated costs carried forward are written off in the year in which that assessment is made.
Exploration and evaluation costs are not carried forward in respect of any area of interest unless the Group's right of tenure to the
property is current. Depletion is not charged on areas of interest under development until commercial production commences, at which time it
will be recorded using a units of production basis which will be based on the mineral mined at each area of interest relative to the
estimated resource relating of that area of interest.
Revenue recognition
Interest revenue is recorded on a time proportion basis, based on the effective yield of the asset. The effective yield of the asset is
the rate of interest required to discount the stream of future cash receipts, expected over the life of the financial asset, to equate to
its net carrying amount.
Foreign currency
The individual financial statements of each Group entity are presented in the currency of the primary economic environment in which the
entity operates (its functional currency). For the purpose of the consolidated financial statements, the results and financial position of
each entity are expressed in Pounds Sterling which is the functional currency of Lithic Metals and Energy Limited and is the presentation
currency for its consolidated financial statements.
Foreign currency translations 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, except when
deferred in equity as qualifying cash flow hedges and qualifying net investment hedges.
Translation differences on non-monetary items, such as equities held at fair value through the profit and loss, are reported as part of
the fair value gain or loss.
The results and financial position of the Group entities (none of which has the currency of a hyperinflationary economy) that have a
functional currency different from the presentation currency are translated into the presentation currency as follows:
* Assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that balance sheet.;
* Income and expenses for each income statement are translated at average rates (unless this is not a reasonable approximation of
the cumulative effect of the rates prevailing on the transaction date, in which case income and expenses are translated at the dates of the
transactions); and
* All resulting exchange differences are recognised as a separate component of equity.
On consolidation, exchange differences arising from the translation of any net investment in foreign entities and borrowings are taken
to shareholders equity. When a foreign operation is sold or borrowings repaid, a proportionate share of such exchange differences are
recognised in the income statement as part of the gain or loss on sale.
Earnings per share and dilutive earnings per share
Basic earnings per share is calculated by dividing the profit attributable to equity holders of the Company, excluding any costs of
servicing equity other than ordinary shares, by the weighted average number of ordinary shares outstanding during the financial year,
adjusted for bonus elements in ordinary shares issued during the year.
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after tax
effect of interest and other finance charges associated with diluted potential ordinary shares and the weighted average number of shares
assumed to have been issued for no consideration in relation to dilutive potential ordinary shares.
2. Reconciliation of Loss
The deficit before income tax was after the following income and expenses:
Unaudited Audited Audited
six months ended six months ended year ended
September 2008 September 2007 March 2007
£ £ £
Interest income 99,690 33,791 150,380
Management fee received 122,893 - -
Profit on asset write-off 399 - -
Total revenue 222,982 33,791 150,380
Auditors' remuneration
- audit services (5,800) 1,425 (18,313)
Depreciation (7,934) (740) (3,434)
Directors' fees (39,327) (18,750) (43,908)
Exploration expenditure - (352,897) (352,753)
written off
Foreign exchange losses (73,617) (2,529) (16,016)
Other costs (175,405) (138,301) (232,220)
Personnel costs - defined (13,159) - (1,967)
contribution plan
Personnel costs - salaries (122,046) (72,515) (209,646)
Share-based payments (91,671) (37,696) (108,818)
Total expenses (528,959) (622,003) (987,075)
Deficit for period (305,977) (588,212) (836,695)
3. Loss Per Share
The calculation of the loss and diluted loss per share is based on the deficit for the financial period of £305,977 (2007 - £588,212)
and the weighted number of average ordinary shares of 152,297,197 (2007 - 63,570,841). No warrants or options have been taken into account
for the diluted loss per share as the impact of these instruments is non-dilutive.
Shares Unaudited Unaudited Audited
six months ended six months ended year ended
September 2008 September 2007 March 2008
Basic weighted average number
of ordinary shares on issue 152,297,197 63,570,841 95,550,665
£ £ £
Basic loss per share (0.01) (0.01) (0.01)
The diluted loss per share is the same as the basic loss per share as the effect of the share
options is non-dilutive.
4. Mineral Interests
a) Reconciliation
Unaudited Unaudited Audited
six months ended six months ended year ended
September 2008 September 2007 March 2008
£ £ £
Opening balance 3,083,930 1,856,849 1,856,849
Exploration costs capitalised 566,858 65,094 350,271
for the period
Purchase of exploration - - 1,236,371
licences
Exploration costs written off - (352,897) (352,753)
Foreign exchange movements 74,095 (17,910) (6,808)
As at 30 September 2008 3,724,883 1,551,136 3,083,930
b) Exploration expenditure per project
Unaudited Unaudited Audited
six months ended six months ended year ended
September 2008 September 2007 March 2008
£ £ £
Group exploration projects
Mitaba 1,578,636 1,411,557 1,488,897
Haito 606,473 - 384,445
Pagala 445,716 - 339,386
Niamtougou 419,738 - 328,423
Kara 331,839 - 317,669
Mavita 342,481 139,579 225,110
As at 30 September 2008 3,724,883 1,551,136 3,083,930
5. Other assets
Unaudited Unaudited Audited
six months ended six months ended year ended
September 2008 September 2007 March 2008
£ £ £
Opening balance 204,839 - -
Investment in uranium JV 921,228 33,637 204,839
farm-in projects for the year
Business development costs 1,126,067 33,637 204,839
Lithic is farming into a uranium Joint Venture with Zambezi Resources Limited. The costs associated with this farm-in are capitalised to
business development projects and forms part of acquisition costs once the farm-in is earned. In the event that Lithic decides not to
proceed with the Joint Venture, all costs capitalised to the Joint Venture will be expensed.
6. Cash and cash equivalents
Unaudited Unaudited Audited
six months ended six months ended year ended
September 2008 September 2007 March 2008
£ £ £
Cash on hand and at bank 311,307 166,970 239,909
Cash on term deposits 2,713,331 1,827,038 4,680,900
Total cash and cash 3,024,638 1,994,008 4,920,809
equivalents
7. Investment in Subsidiaries
At 30 September 2008, the Company had interests in the following subsidiaries:
Company Country of Holding Company Class of Share % Held Nature of Business Investment
Cost
Incorporation Capital Held
£
MR Nickel (Bermuda) Limited Bermuda Lithic Metals and Ordinary 100 Exploration 7,500
Energy Limited
MR Nickel Limited Zambia MR Nickel (Bermuda) Ordinary 100 Exploration 12
Limited
Zambezi Niquel Mozambique Mozambique MR Nickel (Bermuda) Ordinary 100 Exploration 420
Limitada Limited
RRCC Limited (BVI) British Virgin Lithic Metals and Ordinary 100 Exploration 1,246,566
Islands Energy Limited
Regent Resources Capital Togo RRCC (BVI) Limited Ordinary 100 Exploration 10,195
Corporation SAU
Loans by the Company to its subsidiaries are at call, interest free with no agreed fixed terms of repayment. The Company has undertaken
not to recall the loans within 12 months from the date of this report unless the respective subsidiaries are in a financial position to do
so. The balance owing by subsidiaries at 30 September 2008 was £1,568,694.
8. Issued Capital
The Company has 302 million authorised ordinary par value shares at £0.01 each.
Number of Shares Issued Capital Share Premium
£ £ £
Issued and fully paid
Balance at 1 April 2007 35,374,120 353,741 2,234,033
May 2007 placement issue 40,000,000 400,000 1,600,000
Capital raising costs (7,500)
Balance at 30 September 2007 75,374,120 753,741 3,826,533
November 2007 placement issue 61,538,462 615,385 3,384,615
Issued for RRCC Ltd 15,384,615 153,846 846,154
acquisition
Capital raising costs - (219,024)
Balance at 30 September 2008 152,297,197 1,522,972 7,838,278
Notes
a. There were 10,900,000 share options outstanding at the beginning of the period.
b. 2,000,000 share options were issued during the period.
c. No options were exercised during the period.
d. No options expired or were forfeited during the period.
e. The total of share options outstanding at the end of the period was 12,900,000.
f. The weighted average price of the share options outstanding at the end of the period was £0.11.
9. Reserves
Share premium Accumulated deficit Foreign currency Options and warrants
reserve translation reserve reserve
£ £ £ £
As at 1 April 2008 7,838,278 (1,366,033) (45,319) 180,821
Movements during the period - (305,977) 158,570 91,671
As at 30 September 2008 7,838,278 (1,672,010) 113,251 272,492
* The share premium reserve reflects the amounts received for the issuance of shares in excess of the par value of the share.
* The accumulated deficit represents the Group's operational losses since incorporation.
* The foreign currency translation reserve represents the foreign exchange movements on the translation of all foreign entities
controlled by the Group.
* The options and warrants reserve represents the value of all share based payments made to directors, staff and other persons as
measured by the Black Scholes valuation model. The respective amounts are transferred out of the reserve and into share capital and share
premium accounts as and when the options and warrants are exercised.
10. Commitments
On 21 May 2007 the Group entered into a joint venture "Heads of Agreement" with Zambezi Resources Limited (hereafter "ZRL") and signed
the farm-in Joint Venture agreement on 28 April 2008 in which Lithic has the right to explore for uranium on certain of ZRL's mining
licences. In terms of the agreement Lithic is required to contribute in aggregate US$5 million, over a period of 2.5 years, for a 51% equity
participation in both Oryx Resources Limited and Sothern African Resources Limited. To achieve the 51% holding, Lithic must still contribute
US$2,954,093 in aggregate, to the respective companies.
The Group had no contingent liabilities at 30 September 2008.
11. Post-balance Sheet Events
On 16 October 2008 Dr Geoffrey Ian Johnson resigned as a Director of the Company following his relocation to Adelaide.
12. Related Party Transactions
The Group leased office premises and shared certain administrative overheads with Zambezi Resources Limited and during the period made
payments of £233,480 to the Company. At period end the Group had an outstanding obligation of £43,120 payable to Zambezi Resources Limited.
On 28 October 2008 Zambezi Resources Limited sold its shareholding of 26,633,621 ordinary shares in the Company in volatile market
conditions. In order to stabilise the Company's shareholding and its Zambian investments, these shares were acquired at short notice by
Lithic directors and management. At the date hereof the Company announced the restructuring of this transaction as a buyback of the shares
acquired by directors and management by the Company following the lapse of the close period dealing restrictions.
13. General
Detailed financial statements for the 6 months ended 30 September 2008 can be viewed on the Company's web-site at www.lithicme.com.
Authorised on behalf of the Board.
James Kerr Julian Ford
Director Director
Date: 31 December 2008 Date: 31 December 2008
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR WUGCUPUPRGPU
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