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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Medusa Mining | LSE:MML | London | Ordinary Share | AU000000MML0 | ORD NPV (DI) |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 97.50 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
TIDMMML MEDUSA MINING LIMITED ABN: 60 099 377 849 Unit 7, 11 Preston Street Como WA 6152 PO Box 860 Canning Bridge WA 6153 Telephone: 618-9367 0601 Facsimile: 618-9367 0602 Email: admin@medusamining.com.au Internet: www.medusamining.com.au MEDUSA MINING LIMITED (AIM: MML) HALF-YEAR FINANCIAL REPORT 31 DECEMBER 2008 Medusa Mining Limited ("Medusa" or the "Company"), is pleased to report a net after tax profit for the six months to 31 December 2008 of A$12.0 million. Highlights for the six months: * Gold production of 19,144 ounces of gold, an increase of 119% (compared to 8,736 ounces in the same corresponding period in 2007) at an average production cost for the period of US$225 per ounce; * 40% increase in Co-O Mine JORC resource to over 1.2 million ounces; * Phase I and Phase II expansion programmes on schedule, with long term cash costs anticipated at US$200 per ounce. Geoffrey Davis, Managing Director of Medusa, commented: "The Company is starting to see the benefits of its development and expansion programmes and is pleased to report that it is on schedule to increase its gold production initially to 60,000 annualised ounces by Q3, 2009 and then to 100,000 ounces per annum from Q1, 2010 onwards. Being an unhedged, high margin gold producer, we are well positioned for an exciting future as we continue to increase our gold production this year. Medusa is also continuing with an intensive drilling programme at Co-O, designed to further delineate and increase its resource base." 5 March 09 For further information, please contact: Medusa Mining Limited +61 8 9367 0601 Geoffrey Davis, Managing Director Roy Daniel, Finance Director Fairfax I.S. PLC +44 (0)20 7598 5368 Nominated Adviser / Joint Broker Ewan Leggat Mirabaud Securities Limited +44 (0)20 7321 2508 Joint Broker Peter Krens Lothbury Financial +44 (0)20 7011 9411 Michael Padley / Libby Moss REVIEW OF OPERATIONS A summary of activities for the period is presented below. OPERATIONS OVERVIEW The locations of the Company's projects are shown on Figures 1 and 2 (please see the link at the end of this announcement). Figure 1. (please see the link at the end of this announcement) Location diagram Figure 2. (please see the link at the end of this announcement) Regional tenement map showing mines and prospects. Co-O MINE GOLD PRODUCTION The production statistics for the six months to 31 December 2008, are summarised in Table I. Table I. Gold Production +-------------------------------------------------------------------+ | Period | Gold | Head | Cash | Comments | | | produced | grade | costs | | |------------+----------+-------+----------| | | | (ozs) | (g/t | (US$ per | | | | | gold) | oz) | | |------------+----------+-------+----------+------------------------| | Jul to Sep | 6.986 | 10.42 | 243 | On-vein development | | 2008 | | | | and stoping | |------------+----------+-------+----------+------------------------| | Oct to Dec | 12,158 | 15.84 | 215 | On-vein development | | 2008 | | | | and stoping | |------------+----------+-------+----------+------------------------| | TOTAL | 19,144 | 12.71 | 225 | | +-------------------------------------------------------------------+ For the six months to 31 December 2008, the Company produced 19,144 ounces of gold (compared to 8,736 ounces of gold in the corresponding period in 2007) at an average grade of 12.71 g/t gold and average cash production costs of US$225 per ounce. The benefits of the Phase 1 expansion commenced in September 2007 are starting flow through in the last quarter of 2008. Further incremental production increases are forecast in the coming quarters with the full benefits of the Phase I expansion to 60,000 ounces annualised production on track to flow through in the third quarter of 2009. PHASE I MINE EXPANSION Expansion works have proceeded well during the half year with a total of 2,893 metres of development completed. The connection of the 8E and Agsao Shafts is the last stage of the Phase I expansion. The levels in the mine have recently been renamed as follows: Level 1: adit level or 3150 metre level Level 2: 3100 metre level Level 3: 3050 metre level Level 4: 3000 metre level Level 5: 2950 metre level, etc (a) Agsao Shaft The new external Agsao Shaft, to an inclined depth of 240 metres (200 metres vertical) reached final depth in early December with the bottom of this shaft at Level 5. Cutting of the plat and installation of services are in progress with driving along vein to connect to the 8E (or Beta) internal inclined shaft at Level 5 expected to commence during January 2009. (b) 8E(Beta) Shaft The 8E Shaft to an inclined depth of 120 metres (100 metres vertical) is currently at 89.50 metres inclined depth. The timing of the completion of this shaft is being coordinated with the development driving from the Agsao Shaft so that correct drainage levels between the shafts can be set up. PHASE II EXPANSION Work on the Phase II expansion has commenced with the setting up of the collar and headframe for the Baguio Shaft at the western end of the mine. Sinking commenced in early October. (a) Baguio Shaft The Baguio Shaft is designed to provide ore from the western end of the mine above Level 3 for the production increase in 2010 to 100,000 ounces annualised. It is an inclined shaft with a revised inclined depth of approximately 240 metres. It is currently at a depth of 70.30 metres and, provided ground conditions are reasonable, completion is estimated in late 2009. (b) Ventilation Shaft The vertical ventilation shaft at the western end of the mine to link with upper level workings has been completed at 80 metres depth and is now linked to the Levels 1 and 2 providing improved ventilation at the western end of the mine. This shaft will be set-up to haul ore derived from above Level 1. (c) Hillview Shaft A decision on the final position of this high capacity three compartment shaft is expected next quarter. (d) Mill Expansion The construction of two new leach tanks at the mill (commenced in August) which will boost leaching capacity to approximately 750 tonnes per day is expected to be completed during the next quarter. Budgets and quotes are being finalised for the installation of an expanded crushing circuit to reduce the feed size to the ball mill and increase ball mill throughput to approximately 1,000 tonnes per day depending on rock characteristics. (e) Tailings Dam Tailings dam quotes are currently being considered for raising the wall of the current dam. MINE GRID POWER The grid power line to the Co-O Mine has been energised and is performing satisfactorily. Arrival of electric compressors for the eastern end of the mine is expected during the next quarter to replace diesel compressors. The power line is currently being extended to the western end of the mine where electric compressors will also be installed. RESOURCES AND RESERVES On 19 January 2009 the Company published a new resource estimate (Table II) for the Co-O Mine. The new estimation increases the resources by 341,000 ounces or 40% (from 862,000 ounces) after allowing for mine depletion since 12 August 2008. The main increase is from the new high grade discovery named the Great Hamish Vein which currently contains 318,00ounces in 265,000 tonnes at 37.3 g/t gold. The current resource (announced 19 January 2009) and reserve (announced 27 August 2008) estimations are shown in Tables II and III. Table II. Co-O Mine resource summary +------------------------------------------------+ | Category | > 0 g/t gold | | |----------------------------------| | | tonnes | g/t gold | ounces | |-------------+-----------+----------+-----------| | Indicated | 1,110,000 | 13.4 | 480,000 | |-------------+-----------+----------+-----------| | Inferred | 1,710,000 | 13.2 | 723,000 | |-------------+-----------+----------+-----------| | Grand total | 2,820,000 | 13.3 | 1,203,000 | +------------------------------------------------+ Estimation undertaken by Cube Consulting Pty Ltd (2009) Notes: - A lower cut-off of 3 g/t gold is the designated lower cut-off based on economic parameters; - An uppercut of 300 g/t gold has been applied; and - Resources are inclusive of reserves. Table III. Reserve estimation summary +-----------------------------------------+ | Category | > 3 g/t gold | | |------------------------------| | | tonnes | g/t gold | ounces | |----------+---------+----------+---------| | Probable | 712,000 | 10.77 | 249,000 | +-----------------------------------------+ The reserve estimations were undertaken by Golder Associates Pty Ltd (2008). DRILLING Table IV lists the surface diamond drilling results greater than 3 g/t gold from the Co-O Mine for drill holes MD 85 to MD 113 which are included in the new resource estimate. Some intersections in MDs 85-88 have been previously reported on 11 August 2008. Other previous announcements on the Co-O drilling on 9 July, 15 May and 28 February 2007 contain information regarding drilling and surveying techniques, comments on vein interpretation and methodologies and assaying protocols. The discovery of a new high grade vein, the Great Hamish Vein, was announced on 1 December 2008. This vein is open along strike and at depth, and is currently being developed on two levels. The GHV has been defined over approximately 550 metres on the west side of the Oriental Fault and is interpreted to have been intersected on the east side of the fault in holes MD 87, 98, 108 and 112 over a strike length of approximately 100 metres. The vein has consistent high grades and generally dips northwards around 60-70º. The GHV has been intersected by drives on Levels 2 (50 metres below adit) and 3 (100 metres below adit), with driving on vein and sub-level development commenced. Assays from the levels to date are: Level 2: Level drive: 119 metres length at average width of 1.4 metres at 39.79 g/t gold Sublevel: 133 metres length at average width of 1.2 metres at 33.72 g/t gold Level 3: Level drive: 87 metres length at average width of 1.2 metres at 92.00 g/t gold Sub-level: 82 metres length at average width of 1.0 metres at 70.09 g/t gold Table IV. Drill hole results >3g/t gold for holes MD 85 to 113 which are included in the new resource estimate. GHV intersections are marked with an #. +------------------------------------------------------------------------+ | | | | | | | | Grade| |Hole | East| North| Dip| Azimuth| From| Width| (uncut)| | | | | (°)| (°)| (metres)| (metres)| (g/t| | | | | | | | | gold)| |------+--------+--------+-----+---------+----------+----------+---------| |EAST | | | | | | | | |------+--------+--------+-----+---------+----------+----------+---------| |MD 87 | 614206| 912994| -43| 212| 224.75| 1.00|5.46 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 277.20| 5.00|3.50 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 289.00| 4.30|22.66 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 313.00| 1.00|23.19 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 347.10| 0.20|11.45 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 376.30| 2.00|29.20 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 388.90| 3.90|26.45 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 406.90| 0.60|11.65 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 413.60| 1.70|13.65 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 419.40#| 1.60#|19.55# | |------+--------+--------+-----+---------+----------+----------+---------| |MD 98 | 614150| 912993| -57| 210| 313.80| 1.10|5.10 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 340.45| 0.20|28.04 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 504.60| 0.20|4.37 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 508.70#| 4.90#|67.03# | | | | | | | | |(*) | |------+--------+--------+-----+---------+----------+----------+---------| |MD 108| 613856| 912812| -54| 185| 249.40| 0.80|3.21 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 250.75| 0.35|5.80 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 371.95#| 0.25#|120.55# | | | | | | | | |(*) | |------+--------+--------+-----+---------+----------+----------+---------| |MD 112| 614010| 912889| -65| 180| 245.20| 0.25|13.07 (*)| |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 252.75| 0.85|30.23 (*)| |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 331.00| 1.70|60.86 (*)| |------+--------+--------+-----+---------+----------+----------+---------| |WEST | | | | | | | | |------+--------+--------+-----+---------+----------+----------+---------| |MD 85 | 613587| 912868| -75| 180| 157.80| 0.30|11.44 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 183.50| 0.40|7.82 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 214.50| 1.30|9.23 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 257.00#| 2.50#|16.02# | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 264.30| 0.40|6.56 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 277.65| 1.05|8.09 | |------+--------+--------+-----+---------+----------+----------+---------| |MD 86 | 613737| 912855| -60| 190| 217.25#| 2.65#|113.80# | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 287.80| 0.50|33.26 | |------+--------+--------+-----+---------+----------+----------+---------| |MD 88 | 613546| 912850| -75| 195| 66.05| 1.10|20.04 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 69.70| 1.80|13.65 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 126.35| 1.85|16.61 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 219.20| 3.35|3.82 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 228.45| 1.15|3.71 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 264.20| 0.35|42.49 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 280.30| 5.00|4.59 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 328.20| 0.90|3.92 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 366.10#| 1.45#|97.62# | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 399.50| 0.85|13.79 | |------+--------+--------+-----+---------+----------+----------+---------| |MD 91 | 613477| 912845| -70| 205| 61.20| 2.40|4.47 (*) | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 69.10| 0.50|39.63 (*)| |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 198.40#| 1.00#|31.71# | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 287.95| 0.35|11.50 (*)| |------+--------+--------+-----+---------+----------+----------+---------| |MD 92 | 613544| 912844| -62| 196| 65.10| 1.15|4.52 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 193.30| 0.25|88.45 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 195.40#| 1.60#|61.05# | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 211.60| 0.75|14.97 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 278.70| 0.40|9.49 | |------+--------+--------+-----+---------+----------+----------+---------| |MD 97 | 613660| 912837| -65| 190| 151.50| 0.30|33.10 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 172.40#| 3.45#|43.26# | | | | | | | | |(*) | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 195.60| 0.30|12.03 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 201.05| 0.20|40.76 (*)| |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 206.90| 1.30|7.31 (*) | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 295.90| 0.60|43.59 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 307.60| 0.30|6.73 | |------+--------+--------+-----+---------+----------+----------+---------| |MD 100| 613350| 912846| -72| 185| 119.70| 0.40|8.80 (*) | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 155.60| 2.50|17.31 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 218.30| 1.20|6.79 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 223.40#| 2.80#|31.09# | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 249.00| 0.75|7.57 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 267.00| 0.60|10.39 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 277.80| 1.20|4.89 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 343.80| 2.60|10.53 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 357.65| 1.00|5.49 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 362.00| 1.00|7.53 | |------+--------+--------+-----+---------+----------+----------+---------| |MD 103| 613663| 912782| -50| 196| 99.30#| 0.30#|28.29# | |------+--------+--------+-----+---------+----------+----------+---------| |MD 104| 613840| 912883| -60| 168| 202.00| 1.10|14.96 | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 258.65#| 2.25#|166.29# | |------+--------+--------+-----+---------+----------+----------+---------| |MD 111| 613766| 912841| -70| 180| 161.00| 0.60|4.50 (*) | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 190.50| 1.70|15.77 (*)| |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 248.85#| 2.25#|28.10# | | | | | | | | |(*) | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 330.75| 0.25|9.57 | |------+--------+--------+-----+---------+----------+----------+---------| |MD 112| 614010| 912889| -65| 180| 245.20| 0.25|13.70 (*)| |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 252.75| 0.85|30.23 (*)| |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 331.00| 1.70|60.86 (*)| |------+--------+--------+-----+---------+----------+----------+---------| |MD 113| 613767| 912847| -81| 173| 187.40| 1.10|26.13 (*)| |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 420.45| 0.55|7.10 (*) | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 485.15| 0.55|4.15 (*) | |------+--------+--------+-----+---------+----------+----------+---------| | | | | | | 544.70| 1.00|5.93 (*) | +------------------------------------------------------------------------+ Notes: (i) (*) denotes Philsaga assays; (ii) Independent laboratory McPhar assays are quoted in preference to Philsaga assays; (iii) Grid coordinates based on the Philippine Reference System 92; (iv) Intersection lower cut-off grade is 3 g/t gold; (v) Some previously reported intersection widths and grades may have changed as a result of check assaying by McPhar. Drilling is continuing with six surface rigs and 3 underground rigs. Figure 3. (please see the link at the end of this announcement) Composite diagram of the Co-O Mine area showing the projection of the veins and locations of drill holes MD 85-113. Figure 4. (please see the link at the end of this announcement) Co-O Mine 3D model looking north. LINGIG PORPHYRY COPPER DISCOVERY The Lingig prospect is covered by a Mines Operating Agreement ("MOA") over MPSA application number APSA 024-XIII comprising two parcels situated to the north and to the east (the Lingig porphyry copper prospect) of the Co-O Mine and millsite as shown on Figure 2 (please see the link at the end of this announcement). Detailed information on the Lingig porphyry copper prospect was provided in a release dated 13 November 2007 and in the December 2007 quarterly report. Initial drill results from the first hole, LIN 1, were provided in the September 2008 quarterly report. This hole returned 83.9 metres at 0.3% copper above mineralised porphyry compared to 98 metres at 0.27% Cu in DDH 1 in the same zone in 1974. Drilling with one rig is continuing with some difficult ground conditions being encountered. The geology is being revised through comprehensive new mapping as previous maps have found to be inaccurate and not supported by subsurface geology. On completion of this mapping, subsequent interpretations and receipt of a back-log of assays, a comprehensive update will be provided in March 2009. TAMBIS-BAROBO AREA The Tambis project, currently comprising the Bananghilig and Kamarangan prospects, is operated under a Mining Agreement with Philex Gold Philippines Inc. over Mineral Production Sharing Agreement ("MPSA") application APSA-000022-XIII which covers 6,262 hectares. BANANGHILIG Drilling has been completed at the Bananghilig area for the time being. Detailed compilation of the results has been completed, and subject to further interpretative work demonstrating good continuity of mineralisation, an initial resource estimate may be undertaken. KAMARANGAN PORPHYRY TARGET An extensive area of weathered magnetite with secondary hematite skarn mineralisation was located early in 2008. The area is also marked by extensive alluvial gold workings from previous artisinal sluicing operations. Detailed descriptions and results are contained in an announcement dated 29 February 2008 and 14 August 2008. The iron-rich skarn rocks, as well as other skarn types including epidote-silica skarns and sulphide-rich skarns, and hornfels rocks have been mapped as covering an area approximately 2,000 metres east-west by > 800 metres north-south. The skarns are developed in sub-vertical, banded limestones and associated sedimentary rocks. Figure 2 (please see the link at the end of this announcement) shows the location of the Kamarangan area in the Tambis-Barobo region. Drill results from holes KAM 1 and 2 were provided in the September 2008 quarterly report indicating the presence of sub-ore grade copper and molybdenum mineralisation in porphyry rocks and higher grades of copper and gold in the magnetite-rich skarn rocks. Drilling is continuing and a comprehensive report will be provided after the initial drilling campaign which is estimated to be completed in February. Figure 9. (please see the link at the end of this announcement) Map showing skarn types and the locations of drill holes KAM 1 and 2. ANOLING The Mines Operating Agreement ("MOA") with Alcorn Gold Resources Inc. covers Mining Production Sharing Agreement ("MPSA") application number 039-XIII situated approximately 8 kilometres north from the millsite as shown on Figure 2 (please see the link at the end of this announcement). Processing of the Anoling MPSA is progressing. Diamond drilling with one rig is continuing. Underground exploration has been discontinued and drilling may be increased in 2009 if rigs are available whilst the tenement application is progressed. OTHER PROJECTS Ø Abacus Project The Mines Operating Agreement ("MOA") with Abacus Consolidated Resources and Holdings Inc. covers Exploration Permit ("EP") application number 000028-XIII situated to the north of the Co-O mine and millsite as shown on Figure 2 (please see the link at the end of this announcement). The granting process for the Abacus EP is being progressed. The ridge and spur soil sampling described in the Tambis-Barobo section above has covered the eastern parts of the tenement. Ø Saugon Project The Saugon regional ridge and spur soil sampling programme is continuing. Ø Bunawan Mining Corporation JV (Medusa earning 70%) The Company, through its Philippines operating company, Philsaga Mining Corporation ("Philsaga"), signed a joint venture agreement ("JVA") with Bunawan Mining Corporation ("Bunawan") on 23 August 2007, the Philippine operating company of ASX listed Sierra Mining Limited ("Sierra"), whereby Philsaga will earn a 70% joint venture interest in Exploration Permit application ("EPA") 000037-XIII and Mineral Production Sharing Agreement application ("APSA") 000003-XIII (together the "Bunawan JV"). The Company through Philsaga Mining Corporation is continuing to fulfil its obligations under the JVA. COMMUNITY PROGRAMMES Work has commenced on a 16 bed hospital at the Co-O Mine and is expected to be operational around mid-year. A helipad for emergency evacuations will also be constructed adjacent to the hospital. Construction of six new class rooms to be commenced at the Manabo Village serving the Co-O Mine will be completed for the new school year commencing in July. The first full season of support for rice growers through interest-free micro-loans is underway. Initial field trials have established base line costs which have been incorporated into formal agreements between the Company's Foundation and the rice farmers. CORPORATE On 19 September 2008 Crosby Capital Limited ("Crosby") of Hong Kong announced a proposal to make an unsolicited and highly conditional takeover offer ("Offer Announcement") for the Company. On 23 September 2008, the Medusa Board conducted an initial review of the proposed offer as outlined in the Offer Announcement and advised shareholders to take no action as the Board believed the offer was inadequate and opportunistic. On 3 November 2008 Crosby withdrew their offer. JORC COMPLIANCE - CONSENT OF COMPETENT PERSONS Medusa Mining Limited Information in this report relating to Exploration Results, is based on information compiled by Mr Geoff Davis, who is a member of The Australian Institute of Geoscientists. Mr Davis is the Managing Director of Medusa Mining Limited and has sufficient experience which is relevant to the style of mineralization and type of deposits under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the "Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Davis consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. Cube Consulting Pty Ltd Information in this report relating to Mineral Resources has been estimated and complied by Mark Zammit of Cube Consulting Pty Ltd. Mr Zammit is a member of The Australasian Institute of Mining & Metallurgy and has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the "Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Zammit consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. Cube Consulting is an independent Perth based resource industry consulting firm specialising in geological modelling, resource estimation and information technology. Golder Associates Pty Ltd The information in this report that relates to Ore Reserves is based on information compiled by Charles Hastie BAppSc (Mining Engineering), B AppSc (Multidisciplinary Science), MAusIMM and Peter Onley MBA, MSc, BSc (Hons), FAusIMM, CP. Mr Hastie and Mr Onley are full-time employees of Golder Associates Pty Ltd. Messrs Hastie and Onley have sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are undertaking to qualify as Competent Persons as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Charles Hastie and Peter Onley consent to the inclusion in the report of the matters based on their information in the form and context in which it appears. Golder Associates is a global consulting group employing more than 5500 staff offering services in earth engineering and environmental sciences. LEAD AUDITOR'S INDEPENDENCE DECLARATION The lead auditor's independence declaration under section 307C of the Corporations Act 2001 is set out on page 15 for the half-year ended 31 December 2008. This report is signed in accordance with a resolution of the Board of Directors. GEOFFREY J DAVIS Managing Director Dated this 4th day of March 2009. CONDENSED INCOME STATEMENT for the half-year ended 31 December 2008 Consolidated Entity 31 Dec 2008 31 Dec 2007 A$ A$ Revenue 20,169,951 6,164,793 Cost of Sales (7,628,898) (4,091,345) Exploration and Evaluation Expense - (293,574) Administration Expenses (1,838,256) (1,549,500) Other Expenses (499,466) (1,825,794) Profit/(loss) before income tax expense 10,203,331 (1,595,420) Income tax (expense)/benefit 1,841,405 - Profit/l(loss) for the period after income tax expense 12,044,736 (1,595,420) Overall operations: Basic earnings per share $0.083 ($0.011) Diluted earnings per share $0.077 n/a The accompanying condensed notes form part of these financial statements. CONDENSED BALANCE SHEET as at 31 December 2008 Consolidated Entity 31 Dec 2008 30 Jun 2008 Note A$ A$ CURRENT ASSETS Cash & cash equivalents 5,736,734 4,834,161 Trade & other receivables 4,709,168 2,185,194 Inventories 1,694,968 935,976 Other current assets 373,867 333,119 TOTAL CURRENT ASSETS 12,514,737 8,288,450 NON-CURRENT ASSETS Property, plant & equipment 32,462,322 28,499,551 Exploration and evaluation expenditure 39,933,163 28,292,304 Development expenditure 19,647,577 12,447,889 Deferred tax assets 1,401,362 2,851,792 TOTAL NON-CURRENT ASSETS 93,444,424 72,091,536 TOTAL ASSETS 105,959,161 80,379,986 CURRENT LIABILITIES Trade & other payables 10,880,461 6,845,501 TOTAL CURRENT LIABILITIES 10,880,461 6,845,501 NON-CURRENT LIABILITIES Deferred tax liability 1,901,640 5,217,720 Total Non-Current Liabilities 1,901,640 5,217,720 TOTAL LIABILITIES 12,782,101 12,063,221 NET ASSETS 93,177,060 68,316,765 EQUITY Issued capital 6 66,946,550 65,866,550 Reserves 11,206,222 (529,337) Retained profits 15,024,288 2,979,552 TOTAL SHAREHOLDERS' EQUITY 93,177,060 68,316,765 The accompanying condensed notes form part of these financial statements. CONDENSED STATEMENT OF CHANGES IN EQUITY for the half-year ended 31 DECEMBER 2008 Option Retained Premium Foreign Share Profits / Reserve Currency capital (Accumulated (refer Translation Ordinary Losses) note 7) Reserve Total A$ A$ A$ A$ A$ Balance at 01.07.2007 63,805,000 4,327,041 1,544,961 793,287 70,470,289 Shares issued during the period 1,067,450 - - - 1,067,450 Share options recognised during the period in accordance with AASB 2 - Share based payments - - 1,009,600 - 1,009,600 Loss attributable to members of parent entity - (1,595,420) - - (1,595,420) Transfer from Option Premium Reserve 994,100 - (994,100) - - Exchange differences arising on translation of foreign subsidiaries - - - 1,881,699 1,881,699 Sub-total 65,866,550 2,731,621 1,560,461 2,674,986 72,833,618 Dividends paid or provided for - - - - - Balance at 31.12.2007 65,866,550 2,731,621 1,560,461 2,674,986 72,833,618 Balance at 01.07.2008 65,866,550 2,979,552 1,722,692 (2,252,029) 68,316,765 Shares issued during the period 1,080,000 - - - 1,080,000 Share options recognised during the period in accordance with AASB 2 - Share based payments - - 140,761 - 140,761 Profit / (Loss) attributable to members of parent entity - 12,044,736 - - 12,044,736 Exchange differences arising on translation of foreign subsidiaries - - - 11,594,798 11,594,798 Sub-total 66,946,550 15,024,288 1,863,453 9,342,769 93,177,060 Dividends paid or provided for - - - - - Balance at 31.12.2008 66,946,550 15,024,288 1,863,453 9,342,769 93,177,060 +-------------------------------------------------------------------+ | The accompanying condensed notes form part of these financial | | statements. | +-------------------------------------------------------------------+ CONDENSED CASH FLOW STATEMENT for the half-year ended 31 DECEMBER 2008 Consolidated Entity 31 Dec 2008 31 Dec 2007 A$ A$ CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers 20,490,476 5,734,867 Payments to suppliers and employees (6,320,562) (5,946,771) Interest received 23,527 248,659 Net cash provided by operating activities 14,193,441 36,755 CASH FLOWS FROM INVESTING ACTIVITIES Purchase of non-current assets (2,330,054) (1,242,938) Payments for exploration expenditure and (5,528,740) (4,666,166) tenements Payments for development activities (7,328,223) (2,776,237) Payments relating to loan - (2,800,000) Net cash (used in) investing activities (15,187,017) (11,485,341) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of shares 1,080,000 1,742,200 Transaction costs from issue of shares - (1,811,250) Net cash provided by / (used in) 1,080,000 (69,050) financing activities Net increase / (decrease) in cash held 86,424 (11,517,636) Cash at beginning of period 4,834,161 20,168,063 Exchange rate adjustments 816,149 138,289 Cash at end of period 5,736,734 8,788,716 The accompanying condensed notes form part of these financial statements CONDENSED NOTES TO THE FINANCIAL STATEMENTS for the half-year ended 31 DECEMBER 2008 Note 1: Basis of preparation Medusa Mining Limited (the "Company") is a company domiciled in Australia. The consolidated interim financial report of the Company as at and for the six months ended 31 December 2008 comprises the Company and its subsidiaries (together referred to as (the "Consolidated Entity") and the consolidated entity's interests in associates and jointly controlled entities. The consolidated annual financial report of the consolidated entity as at and for the year ended 30 June 2008 is available on the company's website. (a) Statement of compliance The consolidated interim financial report is a general purpose financial report which has been prepared in accordance with AASB 134: Interim Financial Reporting, Australian Accounting Interpretations, other authoritative pronouncements of Australian Accounting Standards Board and the Corporations Act 2001. The consolidated interim financial report does not include all of the information required for a full annual financial report, and should be read in conjunction with the consolidated annual financial report of the consolidated entity as at and for the year ended 30 June 2008. This consolidated interim financial report was approved by the Board of Directors on 26 February 2009. (b) Significant accounting policies The accounting policies applied by the consolidated entity in this consolidated interim financial report are the same as those applied by the consolidated entity in its consolidated financial report as at and for the year ended 30 June 2008. (c) Estimates The preparation of the interim financial report requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. In preparing this consolidated interim financial report, the significant judgements made by management in applying the consolidated entity's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial report as at and for the year ended 30 June 2008. Determination of Ore Reserves and remaining life The Company estimates its ore reserves and mineral resources based on information compiled by Competent Persons (as defined in accordance with the Australian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves as revised December 2004 (the JORC code). Reserves determined in this way are taken into account in the calculation of depreciation, amortisation, impairment, deferred mining costs, rehabilitation and environmental expenditure. In estimating the remaining life of the mine for the purpose of amortisation and depreciation calculations, due regard is given, not only to the amount of remaining recoverable gold ounces contained in proved and probable ore reserves, but also to limitations which could arise from the potential for changes in technology, demand, and other issues which are inherently difficult to estimate over a lengthy time frame. Where a change in estimated recoverable gold ounces contained in proved and probable ore reserves is made, depreciation and amortisation is accounted for prospectively. The determination of ore reserves and remaining mine life affects the carrying value of a number of the Consolidated Entity's assets and liabilities including deferred mining costs and the provision for rehabilitation. The company recently completed a new resource estimation at the Co-O mine which increased the JORC compliant ounces from 862,000 ounces to 1,203,000 ounces. (d) Financial Risk Management The consolidated entity's financial risk management objectives and policies are consistent with that disclosed in the consolidated financial report as at and for the year ended 30 June 2008. CONDENSED NOTES TO THE FINANCIAL STATEMENTS for the half-year ended 31 DECEMBER 2008 Note 2: Changes in Accounting Estimate The Group has reviewed its estimate of the effective tax rate which is expected to be applicable to the various group entities for the year ending 30 June 2009 and in future periods in which taxable and deductible temporary differences are expected to reverse. Following this change in estimate, the balances of the consolidated deferred tax liability and deferred tax asset relating to temporary differences and tax losses have been revised resulting in income tax benefit for the period of $1,841,405. This amount includes a write-back of previously recognised deferred tax liabilities of $2,038,552 relating to the year ended 30 June 2008. Consolidated Entity 31 Dec 2008 31 Dec 2007 A$ A$ Note 3: Profit/(Loss) for the period The following revenue and expense items are relevant in explaining the financial performance for the interim period: Revenue Items - Interest revenue 21,703 270,305 - Gold and silver sales 20,147,924 5,895,663 Expense Items - Depreciation 1,221,328 398,575 - Amortisation 792,636 919,744 - Employee benefits expense 560,680 535,946 - Exploration expenditure write off - 293,574 - Recognition of share based payments 140,761 133,600 Note 4: Dividends No dividend was declared or paid by the Company since the last annual reporting date. Note 5: Segment Information Primary reporting - geographical segment Segment revenue: - Australia 15,902 265,587 - Philippines 20,154,049 5,899,206 Total Revenue 20,169,951 6,164,793 Segment results - Profit/(loss): - Australia (1,527,370) (1,962,255) - Philippines 11,730,701 366,834 Profit/(loss) from ordinary activities 10,203,331 (1,595,421) CONDENSED NOTES TO THE FINANCIAL STATEMENTS for the half-year ended 31 DECEMBER 2008 Consolidated Entity 31 Dec 2008 30 Jun 2008 31 Dec 2008 30 Jun 2008 (shares) (shares) (A$) (A$) Note 6: Issued Capital Ordinary shares on 146,307,548 145,057,548 66,946,550 65,866,550 issue Opening balance 145,057,548 142,037,548 65,866,550 63,805,000 add - Shares issued during 1,250,000 3,020,000 1,080,000 2,061,550 the period 146,307,548 145,057,548 66,946,550 65,866,550 Movement in ordinary shares during the half-year: - Balance at 145,057,548 142,037,548 65,866,550 63,805,000 beginning of the period - Options converted - 3,000,000 - 1,729,200 to ordinary shares at $0.5764 per share - Options converted - 20,000 - 13,000 to ordinary shares at $0.65 per share - Options converted 250,000 - 180,000 - to ordinary shares at $0.72 per share - Options converted 1,000,000 - 900,000 - to ordinary shares at $0.90 per share - Transfer from - - - 994,100 option reserve - Issue costs - - - (674,750) 146,307,548 145,057,548 66,946,550 65,866,550 Consolidated Entity 31 Dec 2008 30 Jun 2008 31 Dec 2008 30 Jun 2008 (options) (options) (A$) (A$) Note 7: Option Premium Reserve Option Premium 10,400,000 12,401,446 1,863,453 1,722,692 Reserve Opening balance 12,401,446 6,021,446 1,722,692 1,544,961 less - Options converted/ (2,401,446) (3,020,000) - (994,100) cancelled add - Options Issued - 7,400,000 - 295,831 Share options 400,000 2,000,000 140,761 876,000 recognised during the period in accordance with AASB 2 - Share based payments 10,400,000 12,401,446 1,863,453 1,722,692 CONDENSED NOTES TO THE FINANCIAL STATEMENTS for the half-year ended 31 DECEMBER 2008 Consolidated Entity 31 Dec 2008 30 Jun 2008 31 Dec 2008 30 Jun 2008 (options) (options) (A$) (A$) Movement in options during the half-year: - Balance at 12,401,446 6,021,446 1,722,692 1,544,961 beginning of the period - Unlisted (1,250,000) (3,020,000) - (994,100) options converted to shares - Unlisted - 7,000,000 - - options exercisable at $1.60 each - 630,000 - - - 56,464 Unlisted options issued and exercisable at $1.25 each (0% vested at balance date) - Options (1,151,446) - - - cancelled - Share options 400,000 2,400,000 140,761 1,115,367 recognised during the period in accordance with AASB 2 - Share based payments 10,400,000 12,401,446 1,863,453 1,722,692 Note 8: Contingent Liabilities Under a Heads of Agreement ("HOA") between Sierra Mining Limited ("SML") and Medusa signed in August 2007, Medusa had agreed to take a 9.9% placement in Sierra of 4.85 million shares (at an issue price of A$0.25, totalling A$1.21 million) with 2.425 million unlisted attaching options exercisable at A$0.30 each with an expiry date of 4 years from the date of completion of due diligence. On 8 April 2008 Sierra advised the ASX that Sierra would not be proceeding with the placement of 9.9% of Sierra shares to Medusa under the HOA, and Medusa agreed not to take up the placement in an announcement to the ASX and AIM markets. Subsequently, on 23 June 2008, Sierra has made a claim against Medusa relating to the HOA and has demanded that Medusa subscribes for the securities. Medusa denies it has any obligation to take up the proposed placement and will defend any legal proceedings that may be commenced. There have been no developments in the period since the annual report. Note 9: Commitments There has been no change to the commitments as disclosed in the entity's 30 June 2008 annual financial report. Note 10: Related Parties Arrangements with related parties continue to be in place. For details on these arrangements, refer to 30 June 2008 annual financial report. Note 11: Events subsequent to balance date There has not arisen in the interval between the half-year ended 31 December 2008 and the date of this report any other item, transaction or event of a material or unusual nature likely, in the opinion of the Directors of the Company, to affect significantly the operations of the Consolidated Entity, the results of those operations, or the state of affairs of the Consolidated Entity, in subsequent financial periods except for: On 26 February 2009 the Company announced a placement of 20,300,000 fully paid ordinary shares at $1.21 each to institutional and sophisticated clients of Euroz Securities Limited ("Euroz"). The placement which was fully underwritten by Euroz raised gross proceeds of $24.563 million. CONDENSED NOTES TO THE FINANCIAL STATEMENTS for the half-year ended 31 DECEMBER 2008 Note 12: Changes in Accounting Policies The following accounting policies were available for early adoption but have not been applied in preparing these consolidated interim financial statements. * AASB 101 Presentation of Financial Statements (Revised 2007) * AASB 8 Operating Segments * AASB 123 Borrowing Costs (Revised 2007) The adoption of AASB 101 (Revised 2007) is applicable for annual reporting periods beginning on or after 1 January 2009. It makes certain changes to the format and titles of the primary financial statements and to the presentation of some items within these statements. It also gives rise to additional disclosures. The measurement and recognition of the Group's assets, liabilities, income and expenses is unchanged. However, some items that were recognised directly in equity will be recognised in other comprehensive income, for example revaluation of property, plant and equipment. AASB 101 affects the presentation of owner changes in equity and introduces a 'Statement of comprehensive income'. AASB 8 is applicable for annual reporting periods beginning on or after 1 January 2009. It will not affect the identified operating segments for the Group. Reported segment results are based on internal management reporting information that is regularly reviewed by the chief operating decision maker. AASB 123 Borrowing Costs (Revised 2007) requires the capitalisation of borrowing costs to the extent they are directly attributable to the acquisition, production or construction of qualifying assets that need a substantial period of time to get ready for their intended use or sale. There will be no effect of the application of the new standard given that the Group already capitalise borrowing costs related to qualifying assets. DIRECTORS' DECLARATION The Directors of the Company declare that: 1. The financial statements and notes, as set out on pages 16 to 24: (a) comply with Accounting Standard AASB 134: Interim Financial Reporting and the Corporations Regulations; and (b) give a true and fair view of the Consolidated Entity's financial position as at 31 December 2008 and of its performance for the half year ended on that date. 2. In the Directors' opinion there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable. This declaration is made in accordance with a resolution of the Board of Directors. GEOFFREY J DAVIS Managing Director Dated this 4 th day of March 2009 =--END OF MESSAGE--- http://hugin.info/138050/R/1295158/294006.pdf This announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.
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