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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Marakand | LSE:MKD | London | Ordinary Share | GB0033883835 | 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% | 5.10 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
RNS Number:3531R Marakand Minerals Limited 16 September 2005 16 September 2005 Final results for the year ended 30 June 2005 Marakand Minerals Limited ("Marakand" or "the Company") is pleased to announce its preliminary results for the year ended 30 June 2005. Highlights include: * Completion of the Khandiza Feasibility Study and receipt of technical approval from the Uzbek Government * Khandiza Project "Act of Site Selection" prepared and approved * Positive independent review completed on the Feasibility Study, indicating areas of upside potential * Environmental and Social Impact Assessment (to World Bank standards) completed, following successful public consultation * Uzbek State Committee of Nature Protection approvals received for the Khandiza underground mine, ore transfer pipeline and processing plant * Framework agreements concluded for treatment of zinc, lead and copper concentrates * Further reconnaissance mapping, outcrop sampling and analyses of key exploration targets in South East Uzbekistan continue to confirm high grade polymetallic mineralisation in locations surrounding Khandiza * Compilation of data on the Tajik Akjilga Project confirms high silver grades and encouraging results from metallurgical test-work Khandiza Following the submission of the Khandiza Feasibility Study to the Uzbek Government in September 2004, Marakand has focused on advancing the permitting stage and negotiating the final form of project development for the Khandiza Project. Good progress has been made on obtaining key Government approvals and permits for Khandiza. Technical approvals that have been granted include: acceptance of the Feasibility Study by the Uzbek State Committee for Architecture and Construction, and signing off of the Act of Site Selection. The latter details the whole project and proposed land allocation for mining, ore processing and mine infrastructure. The Act of Site Selection is a critical step in the permitting process as it demonstrates acceptance of the project by all the relevant local government organisations in the Surkhandarya Region, as well as the central government. Marakand commissioned independent UK consultants Wardell Armstrong International ("WAI") to carry out an independent review of the Khandiza Feasibility Study. This review identified a number of potential upside opportunities for the project, particularly with regard to increasing production and improving metal recoveries. These recommendations will be taken into account during the detailed design and development phases. The environmental and social aspects have been addressed from both an international and a local perspective. Following final review of all the environmental baseline data and successful public consultation, the Environmental and Social Impact Assessment ("ESIA") was prepared by WAI and completed in accordance with World Bank and international standards. The key finding was WAI's conclusion that there are no significant effects to the environment with respect to water, air and land that would inhibit project development. Furthermore, there is potential to enhance local infrastructure through mine development, as well as economic and employment contributions to the local and regional economy. The Uzbek State Committee of Nature Protection has also granted all the local environmental approvals required at this stage of project development, relating to the mine, ore transfer pipeline and processing plant. Preliminary approval has also been given for the mine backfill quarry and the tailings facility. Uzgeotechliti, a local engineering institute, was commissioned to commence geotechnical investigation of the tailings facility and the plant site. Boreholes, trial pits and associated geotechnical test-work have indicated favourable engineering conditions at both locations. Marakand has also invited, received and screened pre-qualification documentation from a number of international detailed mine design and EPCM contractors. Framework agreements have been concluded for the toll smelting and sale of zinc, lead and copper concentrates. Demand for concentrates and metals continues to be in excess of planned production and the Company is well positioned to benefit from its proximity to high growth developing economies. The Company's primary focus has been to secure agreement with the Uzbek Government on the commercial structure of the project. Under the terms of the Government Decree 359 (issued in 2002), which granted Marakand exclusive rights to negotiate the form of project development for the Khandiza Project, two options were set out - a concession or a production sharing agreement. Marakand, following discussion with the Uzbek State Committee of Geology ("Goscomgeology"), initially selected the concession option, as the production sharing option is more suited to single product operations such as oil or gas, whereas Khandiza produces three concentrates containing five payable metals. During the detailed review process the Government has concluded there are weaknesses with the Law on Concessions in its interaction with the relevant Foreign Investment Laws and the tax regime. Due to these weaknesses, it was felt the concession structure did not afford the appropriate level of legal protection that Marakand required. The Uzbek Government has therefore proposed that the more commonly used joint venture structure be considered, whilst acknowledging the need for Marakand to maintain the attractive project economics. A number of successful joint ventures are already operating in the mining sector in Uzbekistan (Zarafshan-Newmont Joint Venture and Oxus Gold's Amantaytau Goldfields Joint Venture). Accordingly Marakand has submitted joint venture documentation to Goscomgeology who await final authorisation from the Uzbek Government to proceed on this basis. The Khandiza Project remains in Uzbekistan's Foreign Investment Programme and is high on the Government's agenda with engagement continuing at all levels. It is anticipated that this process will now be concluded in the fourth quarter of 2005. Khandiza - Resources and reserves * The Soviet resource for the Khandiza Project was estimated in 1974 at 20.9Mt at an average grade of 6.63% zinc, 3.28% lead, 0.84% copper, 114 g/t silver and 0.35 g/t gold. * The JORC classified measured and indicated resource above a 2% zinc cut-off has been estimated in 2004 at 11.83Mt at an average grade of 7.66% zinc, 3.65% lead, 0.921% copper, 129 g/t silver and 0.38 g/t gold. * The mineable reserve above a 4% zinc break-even cut-off, for the first 15 years of production, totals 9.61Mt at an average grade of 7.90% zinc, 3.78% lead, 0.95% copper, 129 g/t silver and 0.37 g/t gold. South East Uzbekistan Exploration With the primary focus of the Marakand team in Tashkent being the Khandiza development process, geological resources have continued to carry out reconnaissance works, rock sampling and analyses on the priority exploration targets in South East Uzbekistan. Commencement of further drilling has been deferred until agreement is secured on the commercial structure of the Khandiza project. Marakand has sampled three zones of outcropping mineralisation at Sulukul on the Yakkabag Ridge, where assays of massive sulphide grab samples average 19.6% zinc, 3.2% lead and 0.9% copper. Samples of oxidised mineralisation in two of the zones, assayed on average 6.0% lead and 241 g/t silver. These high grade results warrant further detailed exploration. In addition to Sulukul on the Yakkabag Ridge, Marakand has carried out further sampling and multi-element analyses of both volcanic host rocks and outcropping mineralisation associated with the Chornova Volcanic Centre, also near Khandiza, namely the Yangaklik, Maidansai and Chinarsai VMS occurrences / anomalies. Samples have been selected for multi-element analyses enabling comparisons to be drawn between Khandiza and other less well explored target areas. Initial results confirm consistency of the volcanic host rocks throughout the region. Analogies are being drawn with the well known Bathurst mining district in Eastern Canada confirming the region's excellent exploration potential. Akjilga Silver Project Compilation of data on the Akjilga Silver Project in Tajikistan illustrates high silver grades encountered during Soviet adit development and encouraging results from metallurgical testwork on Akjilga silver ores. The Soviet resource for the Akjilga Project was estimated at 988,300t at an average grade of 2,114 g/t silver, 0.71% copper and 0.78% antimony. A number of high grade veins, of 0.5 to 2.0m in width, were explored by two adits and associated drives. Preliminary metallurgical testwork carried out in Moscow, on a sample with average grade 996 g/t silver, indicated that 97.2% of the silver could be recovered to a gravity and flotation concentrate grading 30,410 g/t silver, 23.0% copper and 3.5% antimony. The Company is preparing an exploration programme for 2006. Corporate Marakand has continued to evaluate a number of projects in Turkey, the former Soviet Union and Eastern Europe with a view to considering future acquisition. In Turkey, Marakand has signed a Cooperation Agreement with a local partner regarding exploration, development and existing production properties. The Company is in the process of technical and legal reviews. In the former Soviet Union and Eastern Europe, Marakand has had discussions with a number of potential partners regarding collaboration over development of polymetallic licences. Financial Results The Company had $1.7million available at the end of the review period and continues to operate within budget. Outlook The Company has made good progress in advancing the permitting process for the project and now expects an agreement to be reached on Khandiza with the Uzbek Government in Q4,2005. This will initiate the project funding process, detailed design and the commencement of construction with a view to starting production in 2007. Concurrently Marakand will continue to add value through its exploration efforts in Uzbekistan and Tajikistan as well as seeking other opportunities within its target regions. Marakand Minerals is a mining exploration and development company focused in Central Asia and listed on the Alternative Investment Market (AIM) in London, stock exchange symbol MKD.L. For further information please visit www.marakand.co.uk or contact: Marakand Minerals Limited Alasdair Stuart, CEO Tel: + 998 71 120 7162 Joanna Solino, Investor Relations Officer Tel: +44 (0)20 7907 2000 Buck-Bias Limited Alex Buck / Nick Bias Tel: +44 (0)7932 740 452 CONSOLIDATED INCOME STATEMENT ------------------------------ ------------ ------------ (US$000) Year ended Year ended 30 June 2005 30 June 2004 ------------------------------ ------------ ------------ Revenue Gross revenue 25 9 Expenses Administration expenses (720) (702) Deferred exploration and evaluation expenditure (2,281) (1,198) ------------------------------- ------------ ------------ Gross loss (2,976) (1,891) Stock-based compensation - - Foreign exchange gain 55 327 ------------------------------- ------------ ------------ Loss from operations (2,921) (1,564) Interest receivable 136 108 ------------------------------- ------------ ------------ Loss before taxation (2,785) (1,456) Taxation (1) (2) ------------------------------- ------------ ------------ Loss for the year (2,786) (1,458) ------------------------------- ------------ ------------ Loss per share (US cents) Basic (2.76) (2.09) ------------------------------- ------------ ------------ Diluted (2.76) (1.77) ------------------------------- ------------ ------------ CONSOLIDATED BALANCE SHEET -------------------------------- ------------ ------------ (US$000) As at 30 June 2005 As at 30 June 2004 -------------------------------- ------------ ------------ ASSETS Current assets Cash and cash equivalents 1,715 4,223 Trade and other receivables 1 218 -------------------------------- ------------ ------------ 1,716 4,441 Non-current assets Exploration and mining properties 28,456 28,456 -------------------------------- ------------ ------------ 30,172 32,897 -------------------------------- ------------ ------------ LIABILITIES Current liabilities Trade and other payables 96 46 Shareholders' Equity Capital stock 1,781 1,781 Reserves 28,295 31,070 -------------------------------- ------------ ------------ 30,076 32,851 -------------------------------- ------------ ------------ 30,172 32,897 -------------------------------- ------------ ------------ CONSOLIDATED STATEMENT OF CASH FLOWS ------------------------------- ------------ ------------ (US$000) Year ended Year ended 30 June 2005 30 June 2004 ------------------------------- ------------ ------------ CASH FLOWS FROM OPERATING ACTIVITIES Loss for the year (2,786) (1,458) Adjustments for: Depreciation and assets written off - - Stock-based compensation - - Salaries and bonuses converted to shares 11 4 ------------------------------- ------------ ------------ Operating loss before working capital changes (2,775) (1,454) Decrease /(increase) in trade and other receivables 217 (216) Increase in trade and other payables 50 46 ------------------------------- ------------ ------------ Cash used for operations (2,508) (1,624) ------------------------------- ------------ ------------ CASH FLOWS FROM FINANCING ACTIVITIES Warrants and options exercised - - Shares issued - 5,847 ------------------------------- ------------ ------------ Net cash provided by financing activities - 5,847 ------------------------------- ------------ ------------ Net (decrease) increase in cash and cash equivalents (2,508) 4,223 ------------------------------- ------------ ------------ Cash and cash equivalents as at 1 July 4,223 - ------------------------------- ------------ ------------ Cash and cash equivalents as at 30 June 1,715 4,223 ------------------------------- ------------ ------------ STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY -------- --------- ---------- -------- (US$000) Share capital Capital reserve Accumulated loss Total ------------------------- -------- --------- ---------- -------- Balance as at 1 July 2003 17 - (15) 2 Share premium account --------------------------- -------- --------- ---------- -------- Shares issued 341 5,506 - 5,847 Warrants and options - - - - exercised Conversion of directors' remuneration to shares 1 3 - 4 Shares issued to Oxus Gold plc on 22 October 2003 in consideration for the warranty deed in respect of the Khandiza project 1,422 - - 1,422 Capital reserve Capital reserve arising on revaluation of exploration rights in Marakand Minerals Limited - 27,034 - 27,034 Loss for the year - - (1,458) (1,458) --------------------------- -------- --------- ---------- -------- Balance as at 1 July 2004 1,781 32,543 (1,473) 32,851 Shares issued - - - - Warrants and options - - - - exercised Conversion of directors' remuneration to shares - 11 - 11 Stock-based compensation - - - - Loss for the year - - (2,786) (2,786) --------------------------- -------- --------- ---------- -------- Balance as at 30 June 2005 1,781 32,554 (4,259) 30,076 --------------------------- -------- --------- ---------- -------- NOTES 1. The above financial information for the year ended 30 June 2005 is audited, with an unqualified opinion, and does not constitute statutory accounts within the meaning of section 240 of the Companies Act 1985. The financial information for the year ended 30 June 2004 has been extracted from the accounts for that year, which has been delivered to the Registrar of Companies and on which the auditors gave an unqualified opinion. Statutory accounts for the year ended 30 June 2005 will be delivered to the Registrar of Companies. The Annual Report will be posted to shareholders in mid-October 2004 and the Annual General Meeting will be held on 17 November 2005. 2. The basic and diluted loss per share has been calculated by reference to a loss, after taxation, of $2,786,000 (2004: $1,458,000 loss) and the weighted average number of ordinary shares in issue of 101,015,157 (2004: 69,853,282). 3. The Directors do not recommend the payment of a dividend in respect of this period (2004 - nil). 4. The Consolidated Financial Statements, including comparatives, have been prepared in accordance with International Financial Reporting Standards (''IFRS'') issued by the International Accounting Standards Board (''IASB'') and the interpretations issued by the Standing Interpretations Committee of the IASB. 5. Khandiza Services Limited, a 100% subsidiary, has been consolidated within the financial statements. 6. The company will account for stock-based compensation under the rules of IFRS 2, accounting for Share-Based Payments, with effect from 1 July 2005, whereby the fair value of such options is expensed to the income statement in accordance with the specific vesting periods. The Company has not taken any charge in its financial statements this year, but had IFRS 2 been implemented a charge of $93,000 would have been made to the income statement and an adjustment to capital reserves of $93,000.This charge will be made as a prior year adjustment in the 2006 accounts, in accordance with IFRS 2. The basic and diluted loss per share, taking this adjustment into account, is US cents (2.85) per share. This information is provided by RNS The company news service from the London Stock Exchange END FR LAMPTMMBBBBA
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