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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Vatukoula Gold | LSE:VGM | London | Ordinary Share | GB00B52ZLG09 | ORD 5P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 2.30 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
0 | 0 | N/A | 0 |
TIDMVGM
RNS Number : 5638H
Vatukoula Gold Mines PLC
20 May 2014
20 May 2014
Vatukoula Gold Mines plc
("Vatukoula" or "the Company")
Interim Results to 28 February 2014
Vatukoula Gold Mines plc, the AIM listed (AIM: VGM) gold producer focused on Fiji, is pleased to announce its Interim Results for the half-year ended 28 February 2014.
-- Completed the US$ 20 million equity portion of the US$ 40 million investment agreement with Zhongrun International Mining Co. Ltd ("Zhongrun") in November 2013. A total of S20m in loan stock investment to be received by 30 June 2014
-- To date US$4.6 million of the outstanding US$20 million debt financing received -- H1 production of 19.1 koz - on track to achieve full year production target of 40 koz
-- Order of 4 dump trucks and 2 loader completed and scheduled for commissioning in early July 2014
-- 34% reduction in cost of sales from the six months ended 29 February 2012 to the six months ended 28 February 2014.
Financial Highlights: Half Year ended Half Year ended 28 February 2014 28 February 2013 ---------------------------------------- ------------------ ------------------ Revenue (GBP'000) 15,046 20,822 EBITDA (GBP'000) (5,535) 981 Cash (used) / generated from operating activities (GBP'000) (4,455) 343 Underlying operating loss (GBP'000) (9,150) (2,274) Cash cost per ounce sold (US$ / ounce of gold) 1,463 1,635 Average realised gold price (US$ / ounce of gold) 1,264 1,681 Basic (loss) / earnings per share (pence) (3.25) (2.72) Capital investment (GBP'000) 6,134 7,304 ---------------------------------------- ------------------ ------------------ Operational Highlights: Half Year ended Half Year ended 28 February 2014 28 February 2013 ------------------------------------- ----------------------- ----------------------- Total underground tonnes mined (ore and waste) 211,242 206,501 Strike drive development (metres) 828 882 Capital development (metres) 2,862 2,391 Ore processed (tonnes) 174,010 216,860 Average ore head grade (grams of gold / tonne) 4.19 3.80 Total recovery (%) 79.95% 73.24% Gold produced (ounces) 18,712 19,411 Gold shipped (ounces) 19,116 19,595 ------------------------------------- ----------------------- -----------------------
Y.B. Ian He, Non-Executive Chairman of Vatukoula, commented:
"During the half year we completed the US$ 20 million equity portion of the US$40 million investment agreement with our majority shareholder Zhongrun. This has allowed us to continue with our capital development programme and has delivered a 10% improvement in ore grade and a 9% increase in the gold recovery rate. At the same time we have continued to manage our cash costs per ounce which has been reduced by 11% compared to the same period last year.
In March this year the regulatory approval of the US$ 20 million loan portion of the US$40 million was granted, and to date US$ 4.6 million has been advanced. With the current difficult gold and capital market conditions, this funding will provide us with the means to continue or capital investment programme in this fiscal year and we look forward to working alongside Zhongrun as we deliver growth in production to a sustainable and profitable level.
Given the historical delays in financing and the change in the delivery dates of the US$ 20 million loan notes, it has meant we will been unable to progress as quickly as we would have liked to. This is turn has meant that production guidance for the financial year ending August 2014 will be approximately 40,000 ounces as previously announced.
Enquiries Vatukoula Gold Mines Bell Pottinger plc + 44 (0)20 7440 Daniel Thöle + 44 (0)20 7861 Ian He 0643 Marianna Bowes 3232 W.H. Ireland Limited + 44 (0)20 7220 James Joyce 1666
Operating and Financial Performance
Vatukoula Sold 19,116 ounces of gold during the first half of this year at an average cash cost of US$1,463 per ounce. This represents an 11% reduction in cost per ounce, a large portion of the decrease in costs has been driven by the increase in grade which rose 10% from 3.80 grams of gold per tonne in the six months ended 28 February 2013 to 4.19 of gold per tonne in the six months ended 28 February 2014. The increase in grade delivered to the mill also drove a 9% increase in recovery which stood at 79.95% for the six months ended 28 February 2014 (73.24%, for the same period last year).
We have continued to focus on cost reduction with cost of sales reducing by 15% to GBP16.9 million compared to the same period last year. Our continued cost control over the two years has yielded some excellent results with costs of sales dropping 34% from GBP25.5 million for the six months ended 29 February 2012 to GBP16.9 million for the period under review.
Nonetheless, and despite the reduction in costs, we have been effected by the lower gold price environment. Our average realised gold price per ounce decreased from US$1,681 for the six months ending 28 February 2014 to US$1,264 for the period under review. This 25% drop in price has meant that we have lost approximately GBP5.4 million from revenues and as result we had a gross loss of GBP1.9 million during the period compared to a gross profit of GBP0.9 million during the same period last year. After administrative expenses, foreign exchange losses and depreciation and amortisation expenses the operating loss was GBP9.1 million compared to a loss of GBP2.5 million during the same period last year.
As highlighted in January 2014, at the beginning of this financial year the main objectives for this period were to continue with our development schedules to allow access to high grade mining sections. We have continued to invest heavily in our development programme with some GBP5.6 million invested during the period under review, compared to GBP5.2 million during the same period last year.
Underground Production and Development
Gold production from underground mining was limited, as we continued to advance the capital investment programme. We continue to implement footwall drive development (below the ore body) as we believe that this approach will deliver significant benefits and allow for a reduced mining machinery fleet and increased extraction ratio in the long-term. In the short-term however, it will slow initial access to the ore and not produce any gold from development. We do however, remain convinced that this programme is required for the long-term sustainability at Vatukoula.
During the first half of the year we mined a total of 211,242 tonnes of ore and waste, a 2% increase on 206,501 tonnes mined in the same period last year. The increase was driven by higher capital development metres.
Ore delivered from underground was 116,100 tonnes at a grade of 5.18 grams of gold per tonne. Although the tonnage was 8% lower compared to last year, there was 6% increase in underground grade from 4.86 grams per tonne to 5.18 grams per tonne, which resulted in a net marginal decrease in the underground gold delivered to the mill. The lower tonnage was a result of lower strike drive development, reduced stoping tonnes due to reduced face availability during development, and narrower stope mining widths.
Total development decreased to 9,388 metres, a 7% reduction compared to the same period last year. The primary drivers for this were as follows:
-- Operating development includes all mining to access stopes within an ore body (e.g. rises, cross-cuts and gullies). This type of development is expensed as it is normally within the ore body and once the mining has ceased the development has no further use. Operating development decreased by 16% to 5,698 metres compared to the same period last year. This reduction is a result of increased resources being assigned to the capital development programme. Once new development has exposed new mining areas, we expect an increase in operating development.
-- Capital development metres are primarily comprised of inclines, declines and footwall drives. This type of development is carried outside the orebodies and provides long term access to the ore bodies, and is capitalised. Capital development increased by 20% to 2,861 metres compared to the same period last year. This is the result of incline and decline access development and footwall drive development as part of our change in mining methodology. Capital Development is a major item of our new regime in underground mining at Vatukoula.
Operating Results Half Year Half Year % Variance ended 28 February ended 28 February 2014 2013 -------------------------------------- ----------------------- ----------------------- ------------------------ Underground Mining Total underground tonnes mined (ore and waste) 211,242 206,501 2% Operating development (metres) 5,698 6,779 (16%) Strike drive development (metres) 828 882 (6%) Capital development (metres) 2,862 2,391 20% Total development (metres) 9,388 10,052 (7%) Sulphide Plant Sulphide ore delivered (tonnes) 116,100 126,063 (8%) Sulphide head grade (grams of gold / tonne) 5.18 4.86 6% Oxide Plant Ore delivered (tonnes) 58,586 91,547 (36%) Oxide head grade (grams of gold / tonne) 2.06 2.32 (11%) Total (Sulphide + Oxide) Ore processed (tonnes) 174,010 216,860 (20%) Average ore head grade (grams of gold / tonne) 4.19 3.80 10% Total recovery (%) 79.95% 73.24% 9% Gold produced (ounces) 18,712 19,411 (4%) Gold shipped (ounces) 19,116 19,595 (2%) -------------------------------------- ----------------------- ----------------------- ------------------------ Cash Costs -------------------------------------- ----------------------- ----------------------- ------------------------ Cash cost per ounce sold (US$ / ounce of gold) 1,463 1,635 (11%) Cash cost per tonne mined and milled (US$ / tonne) 161 148 9% Average realised gold price (US$ / ounce of gold) 1,264 1,681 (25%) -------------------------------------- ----------------------- ----------------------- ------------------------
Surface Production
During the six months, production from the surface oxides delivered 58,586 tonnes at an average grade of 2.06 grams per tonne. Surface mining produces both oxide material from open pit mining and sulphide material from old waste dumps. During the six months we terminated the surface oxide mining, to focus on the higher grade sulphide waste dumps available in the mine area. The termination of the oxide mining led to drop of 36% in ore delivered from surface mining compared to the same period last year. The surface oxide material is a supplemental source of gold production and will be phased out once we have sufficient production from underground sources.
Vatukoula Treatment Plant ("VTP")
Ore processed for the half year was 174,010 tonnes, a 20% decrease compared to the half year ending 28 February 2013 (216,860 tonnes). The decrease was primarily driven by the decreased surface mining activities, which decreased ore delivered to the mill by 36%.
The average grade processed increased from 3.80 grams of gold per tonne in the half year ending February 2013, to 4.19 grams of gold per tonne in the half year ending February 2014. This was driven by higher grades delivered from underground mining operations and a decrease in lower grade surface tonnes delivered to the mill. Recoveries ran at 79.95% for the period compared to 73.24% in the same period last year. The increase in recovery rates can be attributed to the increase in grade delivered to the mill
The mine shipped and sold 19,116 ounces of gold during for the six months ended 28 February 2014 compared to 19,595 ounces in the same period last year.
Financial Review
Gold shipped for the period was 2% lower than the six months ended February 2013, and the average gold price was significantly lower by 25%. Even though the Company benefited from a reduction in cost of sales, the impact of lower revenue reduced the gross profit for the period into a loss of GBP1.9 million (HY 2013: profit GBP0.9 million). The lower gross profit affected underlying operating loss, and combined with a GBP2.6 million foreign exchange loss (HY 2013: gain 1.5 million) resulted in a GBP9.1 million loss compared to GBP2.3 million loss during the same period last year. Net loss for the period was GBP9.2 million (HY 2013: GBP2.5 million) as a result of the lower gross profits and foreign exchange losses.
Reconciliation between net profit for the period and EBITDA is presented below:
Half Year ended Half Year ended 28 February 2014 28 February 2013 (GBP'000) (GBP'000) -------------------------------------------- ------------------------------ ------------------------------ Loss for the period (9,206) (2,458) Less income tax credit (160) (182) Plus depreciation and amortisation expense (3,656) 3,486 Less finance income (5) (2) Plus finance expense 180 137 -------------------------------------------- ------------------------------ ------------------------------ EBITDA (5,535) 981 -------------------------------------------- ------------------------------ ------------------------------
Revenue
Revenue for the half year was GBP15.0 million which is 28% lower than the prior year period (GBP20.8 million). The Group's year on year sales volume decreased slightly by 479 ounces. The average realised gold price was US$1,264 per ounce in the half year ended February 2014 compared to US$1,681 per ounce in the same period in 2013, which adversely affected revenue.
Cost of Sales and Operating Expenses
Excluding the impact of foreign exchange, cost of sales and operating expenses showed a decrease of 12% compared the same period in 2013. This was in line with a general decrease in total tonnes mined during 2014.
The negative impact from the foreign exchange loss meant the overall Cost of Sales and Operating Expenses increased to GBP24.2 million in the half year ended February 2014 from GBP23.1 million during the same period last year.
Cost of Sales and Operating Half Year ended 28 Half Year ended 28 Expenses February 2014 February 2013 ------------------------------- (GBP'000) (GBP'000) ------------------------------- ------------------- ------------------- Mining (9,595) (11,620) Processing (4,030) (4,561) Overheads (2,939) (3,142) Gold Duty (394) (583) Administrative expenses (979) (1,236) Foreign exchange (loss) /gain (2,603) 1,532 Depreciation and amortisation (3,656) (3,486) ------------------------------- ------------------- ------------------- Total (24,196) (23,096) ------------------------------- ------------------- -------------------
Depreciation and amortisation was GBP3.7 million for the half year ended 28 February 2014, similar to the same period last year (GBP3.5 million).
Cash Costs
Cash costs per ounce sold for the half year ending 28 February 2014 were US$1,463 per ounce sold (2013: US$1,634 per ounce). This is mainly driven by the 10% increase in grade delivered to the mill which decreased the cash cost per ounce by approximately US$131 per ounce of gold shipped.
Cash Costs Half Year ended Half Year ended 28 February 2014 28 February 2013 ------------------------------------------- ------------------ ------------------ Mining (GBP'000) (9,595) (11,620) Processing (GBP'000) (4,030) (4,561) Overheads (GBP'000) (2,939) (3,142) Gold duty (GBP'000) (394) (583) Mine administrative costs (GBP'000) (943) (209) Total cash costs of production (GBP'000) (17,901) (20,115) GBGBP / US$ foreign exchange rate 0.64 0.63 Gold sold (Oz) 19,116 19,595 Tonnes mined and milled 174,010 216,860 Cash cost per ounce sold (US$ / Oz) 1,463 1,635 Cash cost per tonne mined and milled (US$ / tonne) 161 148 ------------------------------------------- ------------------ ------------------
Administrative Expenses
Administrative expenses totalled GBP0.9 million for the half year ended 28 February 2014, which was a 21% decrease in costs from the same period in the prior year of GBP1.2 million. The administrative expenses are those costs associated with maintaining the London office and the administrative expenses in Fiji. Costs include salaries, office rent, regulatory, audit, legal fees and investor related expenses.
Exploration and Resource Definition Costs
As highlighted in the operations review we have curtailed our capital expenditure and incurred GBP63,000 exploration and resource definition costs compared to the GBP1.0 million in the same period last year. All the exploration and resource definition costs were capitalised as an Intangible Asset in accordance with the requirements of IFRS 6 Exploration for and Evaluation of Mineral Assets.
Taxation and Other Expenses
During the period the Company had a tax credit of GBP0.2 million (HY 2013: GBP0.2 million). This tax credit arises as a result of the release of the deferred tax liability. Other expenses amounted to GBP40,000 in the half year ended 28 February 2014 (HY2013: GBP231,000), mostly due to a significant doubtful debt provision in 2013.
Cash Flow
Net cash used in operating activities was GBP4.5 million for the half year ended 28 February 2014, an increase of GBP4.8 million compared to the same period last year (cash generated of GBP0.3 million). Prior to working capital movements the net operating loss was GBP2.3 million compared to GBP0.004 million in the same period last year. The net operating loss before changes in working capital was increased by the changes in working capital which used GBP2.2 million (HY 2013: generated GBP0.3 million). These changes in working capital were a result of an increase in inventories of GBP0.8 million, an increase in receivables of GBP0.3 million and a decrease in accounts payable of GBP1.1 million.
Cash flow used in investing activities equated to GBP6.1 million for the year which represents a 16% decrease from the same period last year of GBP7.3 million. Of the GBP6.1 million used in investing activities GBP0.4 million (HY 2013: GBP1.1 million) was used in the purchase of plant and equipment and GBP5.7 million (HY 2013: GBP6.2 million) was used in underground development and resource / exploration drilling.
Cash provided by financing activities was GBP13.0 million (HY 2013: GBP6.7 million), mostly through the issuance of shares. As of 28 February 2014 the Group had cash and cash equivalents of GBP2.9 million (HY 2013: GBP2.2 million).
Change in Year End
In order to make further savings in both administrative and regulatory costs, the Company has resolved to align its year end with its majority shareholder, Zhongrun. Therefore, the financial year end of the Company will be changing from 31 August to 31 December. The Company will release a further set of interims for the six months from January 2014 to June 2014 which will be published by 30 September 2014. In addition, the Company will report for the 16 months from September 2013 to December 2014 as a transitional financial period, and thereafter for the 12 month period ending 31 December each year.
Post period events
As announced in March 2014 Zhongrun informed the Company that Chinese regulatory approval had been granted for the advance of the second tranche of US$20 million of secured loan notes ("Loan Notes"). The Company and Zhongrun have agreed to vary the terms of the US$20 million loan notes, to match the cashflow requirements of the operations at the Vatukoula Gold Mine. In this regard the schedule of payments from Zhongrun will occur in three tranches, with the first received by no later than the end of April and the last in June. Each tranche will be no less than US$ 4 million and will total US$20 million.
As of 30 April 2014 and the publication of this document the Company has received a total of $4.6m with US$2 million in cash, a further US$1 in underwriting guarantees for the purchase of an additional four underground haulage trucks and two underground loaders and US$1.6 million deposit paid on its behalf for additional resource development drilling.
Outlook
The long term future of profitable mining operations at Vatukoula requires access to new sections of existing ore bodies. Accessing these ore bodies is the key part of our capital investment programme. In addition, to this we will need to carry out an extensive drilling programme to better define the ore bodies, an upgrade and expansion of our heavy vehicle fleet, the construction of an additional tailings dam and other ancillary capital projects.
However, the historical delays in financing and the change in the delivery dates of the US$ 20 million loan notes, have meant that we have been unable to progress as quickly as we would like with the expenditure on plant property and equipment. This is turn has meant that production guidance for the financial year ending August 2014 will be approximately 40,000 ounces as previously advised.
Y.B. Ian He
20 May 2014
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (unaudited) VATUKOULA GOLD MINES PLC 6 months 6 months 28 Feb 28 Feb Notes 2014 2013 GBP'000 GBP'000 --------------------------------------------------- ------ ------------ --------- Turnover 3 15,046 20,822 Cost of sales (16,958) (19,906) Gross (loss) / profit for the period (1,912) 916 --------------------------------------------------- ------ ------------ --------- Operating expenses Administrative expenses (979) (1,236) Foreign exchange (loss) / gain (2,603) 1,532 Depreciation and amortisation expense (3,656) (3,486) Underlying operating loss (9,150) (2,274) --------------------------------------------------- ------ ------------ --------- Impairment charge - - Inventory obsolescence provision - 8 Gain on disposal of assets - 29 Provision for doubtful debt expense - (172) Share based payments expense (41) (96) Operating loss (9,191) (2,505) --------------------------------------------------- ------ ------------ --------- Interest receivable and other income 5 2 Interest payable and similar charges (180) (137) --------------------------------------------------- ------ ------------ --------- Net loss before taxation (9,366) (2,640) --------------------------------------------------- ------ ------------ --------- Taxation 160 182 --------------------------------------------------- ------ ------------ --------- Loss for the period (9,206) (2,458) --------------------------------------------------- ------ ------------ --------- Attributable to: Owners of the Parent (9,206) (2,458) Non-Controlling interest - - --------------------------------------------------- ------ ------------ --------- (9,206) (2,458) Other comprehensive expenses Currency translation differences (301) (509) --------------------------------------------------- ------ ------------ --------- Total comprehensive loss (9,507) (2,967) --------------------------------------------------- ------ ------------ --------- Attributable to: Owners of the Parent (9,507) (2,967) Non-Controlling interest - - --------------------------------------------------- ------ ------------ --------- Loss per share --------------------------------------------------- ------ ------------ --------- Pence Pence Basic 5 (3.25) (2.72) Diluted 5 (3.25) (2.72) --------------------------------------------------- ------ ------------ ---------
All activities relate to continuing operations.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL (audited) POSITION (unaudited) 28 Feb 31 Aug VATUKOULA GOLD MINES PLC Notes 2014 2013 GBP'000 GBP'000 ----------------------------------------------- ------ ------------ ---------- Assets Non-current assets Intangible assets 6 31,703 32,758 Property, plant and equipment 7 20,663 23,604 Mine properties and development 8 23,361 19,913 ----------------------------------------------- ------ ------------ ---------- Total non-current assets 75,727 76,275 ----------------------------------------------- ------ ------------ ---------- Current assets Inventories 6,498 6,558 Trade and other receivables 2,985 3,008 Cash and cash equivalents 2,927 617 ----------------------------------------------- ------ ------------ ---------- Total current assets 12,410 10,183 ----------------------------------------------- ------ ------------ ---------- Total Assets 88,137 86,458 ----------------------------------------------- ------ ------------ ---------- Current liabilities Trade and other payables 6,461 8,404 Provisions 1,087 1,261 Borrowings 125 62 Vatukoula Social Assistance Trust Fund 1,058 1,127 Convertible loan 333 347 ----------------------------------------------- ------ ------------ ---------- ` Total current liabilities 9,064 11,201 ----------------------------------------------- ------ ------------ ---------- Non-current Liabilities Provisions 4,574 4,751 Convertible loan - - Vatukoula Social Assistance Trust Fund 15 15 Deferred tax liability 5,409 5,569 ----------------------------------------------- ------ ------------ ---------- Total non-current liabilities 9,998 10,335 ----------------------------------------------- ------ ------------ ---------- Shareholders' Equity Share capital 10 17,213 7,768 Share premium account 94,711 91,139 Merger reserve 2,167 2,167 Foreign exchange reserve 1,369 1,068 Other reserves 3,108 3,067 Accumulated losses (49,493) (40,287) ----------------------------------------------- ------ ------------ ---------- Total shareholders' equity 69,075 64,922 ----------------------------------------------- ------ ------------ ---------- Total liabilities and shareholders' equity 88,137 86,458 ----------------------------------------------- ------ ------------ ---------- CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (unaudited) (unaudited) VATUKOULA GOLD MINES PLC 6 months 6 months 28 Feb 28 Feb Notes 2014 2013 GBP'000 GBP'000 ---------------------------------------------- ------ ------------ ------------ Cash flows from operating activities Operating loss for the period: (9,191) (2,505) Adjustments for: Share based payments 41 96 Depreciation and amortisation 3,656 3,486 Impairment - - Gain on disposal of assets - (29) Inventory obsolescence provision - (8) Foreign exchange losses / (gains) 3,354 (1,105) Provision for doubtful debt expense - 172 Provision for mine rehabilitation - - Movements in Employment Provisions (134) (111) ---------------------------------------------- ------ ------------ ------------ Net operating loss before changes in working capital (2,274) (4) ---------------------------------------------- ------ ------------ ------------ Payment to Vatukoula Social Assistance - - Trust Fund (Increase) / decrease in inventories (792) 368 (Increase) / decrease in receivables (321) 1,825 Decrease in accounts payable (1,068) (1,846) ---------------------------------------------- ------ ------------ ------------ Net cash (used) / generated in operating activities (4,455) 343 ---------------------------------------------- ------ ------------ ------------ Cash flows from investing activities Payments for intangible assets (63) (997) Purchase of property plant and equipment (429) (1,096) Payments for mine properties and development (5,647) (5,242) Proceeds from disposals of property plant and equipment - 29 Interest received 5 2 ---------------------------------------------- ------ ------------ ------------ Net cash used in investing activities (6,134) (7,304) ---------------------------------------------- ------ ------------ ------------ Cash flows before financing (10,589) (6,961) ---------------------------------------------- ------ ------------ ------------ Cash flows from financing activities Proceeds from issuance of shares 10 13,017 6,600 Interest paid (44) (126) Proceeds from borrowings 63 174 ---------------------------------------------- ------ ------------ ------------ Net cash provided by financing activities 13,036 6,648 ---------------------------------------------- ------ ------------ ------------ Net increase / (decrease) in cash and cash equivalents 2,447 (313) ---------------------------------------------- ------ ------------ ------------ Cash and cash equivalents at beginning of the period 617 2,437 Effect of foreign exchange on cash and cash equivalents (137) 43 ---------------------------------------------- ------ ------------ ------------ Cash and cash equivalents at end of the period 2,927 2,167 ---------------------------------------------- ------ ------------ ------------ CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY VATUKOULA GOLD MINES PLC (unaudited) Share Equity Ordinary Foreign based component share Share Merger exchange payment of convertible Accumulated capital premium reserve reserve reserve loan note losses Total GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 ---------------- --------- --------- --------- ---------- --------- ---------------- ------------ ------------ Balance at 1 September 2013 7,768 91,139 2,167 1,068 3,022 45 (40,287) 64,922 Loss for the period - - - - - - (9,206) (9,206) Other comprehensive income - Currency translation differences - - - 301 - - - 301 Total comprehensive income - - - 301 - - (9,206) (8,905) ---------------- --------- --------- --------- ---------- --------- ---------------- ------------ ------------ Issue of shares 9,445 3,572 - - - - - 13,017 Cost of share - - - - - - - - issue Share option - - - - - - - - expired Convertible - - - - - - - - loan Share based payments - - - - 41 - - 41 Balance at 28 February 2014 17,213 94,711 2,167 1,369 3,063 45 (49,493) 69,075 ---------------- --------- --------- --------- ---------- --------- ---------------- ------------ ------------ Share Equity Ordinary Foreign based component share Share Merger exchange payment of convertible Accumulated capital premium reserve reserve reserve loan note losses Total GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 ------------------- --------- --------- --------- ---------- --------- ---------------- ------------ --------- Balance at 1 September 2012 4,828 81,659 2,167 1,022 2,837 45 (24,623) 67,935 Profit for the year - - - - - - (2,458) (2,458) Other comprehensive income - Currency translation differences - - - 509 - - - 509 Total comprehensive income - - - 509 - - (2,458) (1,949) ------------------- --------- --------- --------- ---------- --------- ---------------- ------------ --------- Issue of shares 1,000 5,600 - - - - - 6,600 Cost of share - - - - - - - - issue Share option - - - - - - - - expired Convertible loan - - - - - - - - Share based payments - - - - 96 - - 96 Balance at 28 February 2013 5,828 87,259 2,167 1,531 2,933 45 (27,081) 72,682 ------------------- --------- --------- --------- ---------- --------- ---------------- ------------ ---------
NOTES TO THE FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 28 FEBRUARY 2014
1. General information
Vatukoula Gold Mines Plc. is registered in England and Wales under number 5059077. The Company is governed by its articles of association and the principal statute governing the Company is the Companies Act 2006. The Company's registered office is at 2 More London Riverside, London, SE1 2AP. The company is listed on the AIM market of the London Stock Exchange. The principal activity of the Group is the mining of gold ore and the refining of the ore into gold Dore bars which are sold to be smelted into gold.
2. Basis of preparation
The interim condensed consolidated financial statements have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting.
These interim condensed consolidated financial statements are unaudited and does not constitute statutory financial statements. The interim condensed consolidated financial statements incorporate the results of the Group for the period from 1 September 2013 to 28 February 2014. The results for the year ended 31 August 2013 have been extracted from the statutory financial statements for Vatukoula Gold Mines plc. for the year ended 31 August 2013 which are prepared under International Financial Reporting Standards ("IFRS") as adopted by the European Union. The interim financial information should be read in conjunction with the annual financial statements for the year ended 31 August 2013.
The same accounting policies, presentations and methods of computation have been followed in these condensed financial statements as were applied in the preparation of the Group's financial statements for the year ended August 2013.
These financial statements have been prepared on a going concern basis, on the assumption that the Group and the Company will generate adequate cash flows from operations and receive continuing financial support from the majority shareholder of the Company in accordance with its financing agreements.
3. Turnover and Segmental Analysis
All turnover in the Group in the current and prior period is derived from the sales to one customer, which is included in the Gold Mining Segment.
NOTES TO THE FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 28 FEBRUARY 2014
3. Turnover and Segmental Analysis (continued) SEGMENTAL ANALYSIS VATUKOULA GOLD MINES PLC Unattributed 28 Feb 2014 Head Office Gold Other (unaudited) Costs Mining Activity Total GBP'000 GBP'000 GBP'000 GBP'000 ------------------------------- ------------- --------- --------- --------- Turnover - 15,046 - 15,046 ------------------------------- ------------- --------- --------- --------- Mining - (9,595) - (9,595) Processing - (4,030) - (4,030) Gold duty - (394) - (394) Overheads - (2,939) - (2,939) ------------------------------- ------------- --------- --------- --------- Cost of sales - (16,958) - (16,958) ------------------------------- ------------- --------- --------- --------- Gross Profit - (1,912) - (1,912) ------------------------------- ------------- --------- --------- --------- Administrative expenses (593) (336) (50) (979) Foreign exchange losses - (2,603) - (2,603) Depreciation and amortisation (799) (2,851) (6) (3,656) ------------------------------- ------------- --------- --------- --------- Underlying operating loss (1,392) (7,702) (56) (9,150) ------------------------------- ------------- --------- --------- --------- Inventory obsolescence - - - - Gain on disposal of assets - - - Impairment charge - - - - Provision for doubtful - - - debt - Share based payments (3) (38) - (41) ------------------------------- ------------- --------- --------- --------- Operating loss (1,395) (7,740) (56) (9,191) ------------------------------- ------------- --------- --------- --------- Interest receivable and other income 5 - - 5 Interest payable and similar charges (24) (156) - (180) ------------------------------- ------------- --------- --------- --------- Net loss before taxation (1,414) (7,896) (56) (9,366) ------------------------------- ------------- --------- --------- --------- Taxation 160 - - 160 ------------------------------- ------------- --------- --------- --------- Loss for the period (1,254) (7,896) (56) (9,206) ------------------------------- ------------- --------- --------- --------- Other Segment Items Additions to intangible assets - 63 - 63 Additions to property, plant, and equipment - 429 - 429 Additions to mine properties and development - 5,647 - 5,647 ------------------------------- ------------- --------- --------- --------- Current assets 2,093 10,270 47 12,410 Non currents assets 27,047 48,527 153 75,727 ------------------------------- ------------- --------- --------- --------- Current liabilities (539) (8,520) (5) (9,064) Noncurrent liabilities (5,419) (4,579) - (9,998) ------------------------------- ------------- --------- --------- ---------
NOTES TO THE FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 28 FEBRUARY 2014
3. Turnover and Segmental Analysis (continued) Unattributed 28 Feb 2013 Head Office Gold Other (Unaudited) Costs Mining Activity Total GBP'000 GBP'000 GBP'000 GBP'000 ------------------------------- ------------- --------- --------- --------- Turnover - 20,822 - 20,822 ------------------------------- ------------- --------- --------- --------- Mining - (11,620) - (11,620) Processing - (4,561) - (4,561) Gold duty - (583) - (583) Overheads - (3,142) - (3,142) ------------------------------- ------------- --------- --------- --------- Cost of sales - (19,906) - (19,906) ------------------------------- ------------- --------- --------- --------- Gross Profit - 916 - 916 ------------------------------- ------------- --------- --------- --------- Administrative expenses (943) (209) (84) (1,236) Foreign exchange gains - 1,532 - 1,532 Depreciation and amortisation (793) (2,685) (8) (3,486) ------------------------------- ------------- --------- --------- --------- Underlying operating loss (1,736) (446) (92) (2,274) ------------------------------- ------------- --------- --------- --------- Inventory obsolescence - 8 - 8 Gain on disposal of assets - 29 29 Provision for doubtful debt - (172) - (172) Share based payments - (96) - (96) ------------------------------- ------------- --------- --------- --------- Operating loss (1,736) (677) (92) (2,505) ------------------------------- ------------- --------- --------- --------- Interest receivable and other income 2 - - 2 Interest payable and similar charges (23) (114) - (137) ------------------------------- ------------- --------- --------- --------- Net loss before taxation (1,757) (791) (92) (2,640) ------------------------------- ------------- --------- --------- --------- Taxation 182 - - 182 ------------------------------- ------------- --------- --------- --------- Loss for the period (1,575) (791) (92) (2,458) ------------------------------- ------------- --------- --------- --------- Other Segment Items Additions to intangible assets - 997 - 997 Additions to property, plant, and equipment - 1,096 - 1,096 Additions to mine properties and development - 5,242 - 5,242 ------------------------------- ------------- --------- --------- --------- Current assets 684 13,486 173 14,343 Non currents assets 28,644 50,804 188 79,636 ------------------------------- ------------- --------- --------- --------- Current liabilities (807) (10,352) 8 (11,151) Non current liabilities (6,575) (3,571) - (10,146) ------------------------------- ------------- --------- --------- ---------
NOTES TO THE FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 28 FEBRUARY 2014
4. Results for the period
The Interim results are not affected by seasonality or cyclicity.
5. Earnings per share (a) Basic Basic loss per share is calculated by dividing the loss for the year from continuing operations of the Group by the weighted average number of ordinary shares in issue during the year The calculation of consolidated loss per share is based on the following loss and number of shares: 2014 2013 GBP'000 GBP'000 ------------------------------------------------- ------------- ------------ Loss after tax (9,206) (2,458) ------------------------------------------------- ------------- ------------ 2014 2013 Number Number ------------------------------------------------- ------------- ------------ Basic weighted average ordinary shares in issue during the period 282,834,334 90,509,159 ------------------------------------------------- ------------- ------------ 2014 2013 Pence Pence ------------------------------------------------- ------------- ------------ Basic loss per share (3.25) (2.72) ------------------------------------------------- ------------- ------------ (b) Diluted All potential shares were anti-dilutive as the Group was in a loss making position. As a result diluted loss per share for the periods ended 28 February 2014 and 28 February 2013 is disclosed as the same value as basic loss per share. The diluted weighted average ordinary shares in issue during the period were 282,834,334 (2013: 90,509,159).
NOTES TO THE FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 28 FEBRUARY 2014
6. Intangible assets Mining Computer Exploration Rights Software expenditure Total Group GBP'000 GBP'000 GBP'000 GBP'000 ---------------------------------- -------- --------- ------------ -------- Cost As at 1 September 2013 38,721 522 7,608 46,851 Additions - - 63 63 Disposals - - - - Transferred from tangible assets - - - - Exchange difference - (32) (467) (499) ---------------------------------- -------- --------- ------------ -------- As at 28 February 2014 38,721 490 7,204 46,415 ---------------------------------- -------- --------- ------------ -------- Amortisation As at 1 September 2013 10,874 104 3,115 14,093 Current charge 801 15 - 816 Impairment charge - - - - Exchange difference - (7) (190) (197) ---------------------------------- -------- --------- ------------ -------- As at 28 February 2014 11,675 112 2,925 14,712 ---------------------------------- -------- --------- ------------ -------- Carrying value as at 28 February 2014 27,046 378 4,279 31,703 ---------------------------------- -------- --------- ------------ -------- Mining Computer Exploration Rights Software expenditure Total Group GBP'000 GBP'000 GBP'000 GBP'000 ---------------------------------- -------- --------- ------------ -------- Cost As at 1 September 2012 38,721 551 6,933 46,205 Additions - - 1,085 1,085 Disposals - - - - Transferred from tangible assets - - - - Exchange difference - (29) (410) (439) ---------------------------------- -------- --------- ------------ -------- As at 31 August 2013 38,721 522 7,608 46,851 ---------------------------------- -------- --------- ------------ -------- Amortisation As at 1 September 2012 9,284 80 - 9,364 Current charge 1,590 30 - 1,620 - - 3,264 3,264 Exchange difference - (6) (149) (155) ---------------------------------- -------- --------- ------------ -------- As at 31 August 2013 10,874 104 3,115 14,093 ---------------------------------- -------- --------- ------------ -------- Carrying value as at 31 August 2013 27,847 418 4,493 32,758 ---------------------------------- -------- --------- ------------ --------
NOTES TO THE FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 28 FEBRUARY 2014
6. Intangible assets (continued)
The Mining rights represent the mining rights acquired on the acquisition of the Vatukoula Gold Mine in April 2008. The amortisation of the Mining Rights is calculated on a unit of production basis, based on forecast production and the total Mineral Reserves. At the current production, reserves and gold price, the useful economic life is expected to be 7 years. This rate will vary from year to year and is dependent on the mineral reserves which are reassessed every year. Amortisation is included in depreciation and amortisation in the Statement of Comprehensive Income.
For the year ended August 2013 the directors carried out an impairment review. As in previous years, this was based on an estimate of discounted future cash flows from the development and operation of the Vatukoula Gold Mine. The directors have used past experience and an assessment of future conditions, together with external sources of information, to determine the assumptions which were adopted in the preparation of a financial model to estimate the cashflows.
The recoverable amount of the mine is determined by using a net present value calculation based on the estimated
economically recoverable portion of the total Mineral Resource and the life of mine plan. The life of mine plan is currently 7 years. This Mineral Resource is used rather than the Mineral Reserve as the Mineral Reserve will not represent the total recoverable amount from the mine. This is because it excludes ore deposits that are above the economic cut off grade within the Inferred Mineral Resource category.
The key assumptions therein are those regarding discount rates, and expected changes to selling prices and direct costs during the period. Management estimates discount rates using pre-tax rates that reflect current market assessments of the time value of money and the risks specific to the mine and the rate used was 10%.
The production is based on the directors' forecast of the mine's maximum output and based on the mine achieving its operating capacity. The directors believe this rate is justified based on the current progress of the mine. A deferred tax liability of GBP10,757,000 arose in 2008 in respect of the intangible assets recognised on the acquisition in the prior periods. The deferred tax liability is in respect of future taxable profits potentially generated from the exploration of the mining rights.
The Exploration expenditure is an internally generated intangible asset, and represents costs associated with the exploration and evaluation of mineral deposits on our mining and special prospecting licenses and are capitalised under IFRS 6. The directors believe that there are no indicators of impairment.
The Computer Software expenditure represents the costs associated with the purchase of specialised mining and inventory software.
.
NOTES TO THE FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 28 FEBRUARY 2014
7. Property, plant and equipment Freehold Fixtures and leasehold Work Plant Motor Mine fittings land in progress and machinery vehicles assets and equipment Total Group GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 ------------------ --------------- ------------- --------------- ---------- --------- --------------- --------- Cost As at 1 September 2013 975 1,591 33,669 347 3,268 143 39,993 Additions - 429 - - - - 429 Transferred on completion - (711) 711 - - - - Disposals - - - - - - - Exchange difference (55) (81) (3,084) (8) (200) (1) (3,429) ------------------ --------------- ------------- --------------- ---------- --------- --------------- --------- As at 28 February 2014 920 1,228 31,296 339 3,068 142 36,993 ------------------ --------------- ------------- --------------- ---------- --------- --------------- --------- Accumulated depreciation As at 1 September 2013 29 - 15,529 232 502 97 16,389 Charge for the period 5 - 1,970 1 53 - 2,029 Disposals - - - - - - - Exchange difference (2) - (2,049) (4) (32) (1) (2,088) ------------------ --------------- ------------- --------------- ---------- --------- --------------- --------- As at 28 February 2014 32 - 15,450 229 523 96 16,330 ------------------ --------------- ------------- --------------- ---------- --------- --------------- --------- Net book value At 28 February 2014 888 1,228 15,846 110 2,545 46 20,663 ------------------ --------------- ------------- --------------- ---------- --------- --------------- --------- At 31 August 2013 946 1,591 18,140 115 2,766 46 23,604 ------------------ --------------- ------------- --------------- ---------- --------- --------------- --------- Freehold Fixtures and leasehold Work Plant Motor Mine fittings land in progress and machinery vehicles assets and equipment Total Group GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 ------------------ --------------- ------------- --------------- ---------- --------- --------------- --------- Cost As at 1 September 2012 1,024 2,572 33,466 341 1,998 145 39,546 Additions - 2,216 - 26 - - 2,242 Transferred on completion - (3,109) 3,109 - - - - Disposals - - (169) - - - (169) Changes in estimates - - - - 1,374 - 1,374 Exchange difference (49) (88) (2,737) (20) (104) (2) (3,000) ------------------ --------------- ------------- --------------- ---------- --------- --------------- --------- As at 31 August 2013 975 1,591 33,669 347 3,268 143 39,993 ------------------ --------------- ------------- --------------- ---------- --------- --------------- --------- Accumulated depreciation As at 1 September 2012 13 - 13,021 238 463 98 13,833 Charge for the period 17 - 4,436 3 66 1 4,523 Disposals - - (169) - - - (169) Exchange difference (1) - (1,759) (9) (27) (2) (1,798) ------------------ --------------- ------------- --------------- ---------- --------- --------------- --------- As at 31 August 2013 29 - 15,529 232 502 97 16,389 ------------------ --------------- ------------- --------------- ---------- --------- --------------- --------- Net book value At 31 August 2013 946 1,591 18,140 115 2,766 46 23,604 ------------------ --------------- ------------- --------------- ---------- --------- --------------- ---------
NOTES TO THE FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 28 FEBRUARY 2014
8. Mine properties and development 2014 2013 GBP'000 GBP'000 ----------------------------- -------- -------- Cost Balance as at 1 September 23,272 13,865 Additions 5,647 10,624 Foreign exchange difference (1,622) (1,217) ----------------------------- -------- -------- Balance at end of period 27,297 23,272 ----------------------------- -------- -------- Depreciation Balance as at 1 September 3,359 2,350 Current charge 811 1,185 Foreign exchange difference (234) (176) ----------------------------- -------- -------- Balance at end of period 3,936 3,359 ----------------------------- -------- -------- Carrying value Balance at end of period 23,361 19,913 ----------------------------- -------- -------- 9. Provisions Group ------------------------------------ ------------ -------------------- ------------------------- 28-Feb-14 31-Aug-13 GBP'000 GBP'000 ------------------------------------ ------------ -------------------- ------------- ---------- Current Provision for annual leave 245 260 Provision for workers compensation 104 102 Other employee related provisions 738 899 ------------------------------------ ------------ -------------------- ------------- ---------- 1,087 1,261 ------------------------------------ ------------ -------------------- ------------- ---------- Non current Provision for mine rehabilitation 4,520 4,660 Provision for Long Service Leave 54 91 ------------------------------------ ------------ -------------------- ------------- ---------- 4,574 4,751 ------------------------------------ ------------ -------------------- ------------- ---------- 5,661 6,012 ------------------------------------ ------------ -------------------- ------------- ---------- Employee related Long Service provisions Mine rehabilitation Leave Total Group GBP'000 GBP'000 GBP'000 GBP'000 ------------------------------------ ------------ -------------------- ------------- ---------- Balance at 1 September 2013 1,261 4,660 91 6,012 Additional provisions made during the period (100) - (34) (134) Reversed during the period - - - - Unwinding of discount - 150 - 150 Changes in estimates - - - - Exchange difference (73) (290) (4) (367) ------------------------------------ ------------ -------------------- ------------- ---------- Balance at 28 February 2014 1,088 4,520 53 5,661 ------------------------------------ ------------ -------------------- ------------- ----------
NOTES TO THE FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 28 FEBRUARY 2014
9. Provisions (continued)
Employee related provisions include a provision for unpaid annual leave based on Fijian labour legislation, and a provision for legally required workers compensation relating to work injuries. Based on current estimates, these are expected to realise in approximately 10 years.
The provision for mine rehabilitation represents the current mine closure plan. The present value of the estimated cost is capitalised as property, plant and equipment. Over time the discounted liability will be increased for the change in the present value based on the discount rates that reflect the current market assessments and the risks specific to the liability. The provision for Mine rehabilitation is expected to be expensed over 7 years. This is based on the current economic useful life of seven years plus a further three years of rehabilitation. The economic useful life is dependent on the economic viability of extracting the contained Mineral Reserves and may vary on a year by year basis dependant on the mining / processing costs and the price of gold. In addition the quantum of the provision may vary on a year by year basis dependant on the costs associated with executing the Mine Rehabilitation Plan.
Long Service Leave is a contractual obligation for additional leave days earned by employees with 10 years or more service. Based on current estimates, these are expected to realise in approximately 10 years.
10. Share capital
(a) Share capital
Group and Company ------------------------------------ ---------------------- 28-Feb-14 31-Aug-13 GBP'000 GBP'000 ------------------------------------ ---------- ---------- Allotted, issued and fully paid 344,255,339 ordinary shares of 5p each (31 Aug 2013: 155,358,339 ordinary shares of 5p each) 17,213 7,768 ------------------------------------ ---------- ----------
(b) Share issues during the period
The following shares were issued during the period ended 28 February 2014:
Issue Par Value value value Share of shares per per premium Share Share issued Share Share per Share Shares Capital premium for cash Date GBP GBP GBP GBP GBP GBP ---------------- ------------ ------- ------- ----------- ------------ ---------- ---------- ----------- Shares issued for cash Issue for cash 21/10/2013 0.07 0.05 0.02 90,000,000 4,500,000 1,701,000 6,201,000 Issue for cash 05/11/2013 0.07 0.05 0.02 98,897,000 4,944,850 1,870,854 6,815,704 188,897,000 9,444,850 3,571,854 13,016,704 ----------------------------- ------- ------- ----------- ------------ ---------- ---------- -----------
NOTES TO THE FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 28 FEBRUARY 2014
10. Share capital (continued)
(c) Warrants and options
During the period ending 28 February 2014 the following movements occurred on the warrants and options to purchase 5p ordinary shares in Vatukoula Gold Mines Plc.
Average Number exercise of price Number Number Number Number Number Number warrants Number Number per of of of of of of and of of share options options options options options options options options options Exercise price GBP0.50 GBP0.70 GBP0.88 GBP0.90 GBP0.95 GBP0.97 GBP1.00 GBP1.39 GBP1.75 Total ----------- ------------------ --------- --------- --------- --------- --------- --------- ----------- --------- --------- ----------- Balance at 1 September 2013 1.1 863,000 360,000 235,000 400,000 365,000 700,000 4,200,000 484,112 800,000 8,407,112 Granted during the period - - - - - - - - - - - Exercised during the period - - - - - - - - - - - Expired during the period - - - - - - - - - - - ----------- ------------------ --------- --------- --------- --------- --------- --------- ----------- --------- --------- ----------- Balance at 28 February 2014 1.1 863,000 360,000 235,000 400,000 365,000 700,000 4,200,000 484,112 800,000 8,407,112 ----------- ------------------ --------- --------- --------- --------- --------- --------- ----------- --------- --------- ----------- Average Number exercise of price Number Number Number Number Number Number warrants Number Number per of of of of of of and of of share options options options options options options options options options Exercise price GBP0.50 GBP0.70 GBP0.88 GBP0.90 GBP0.95 GBP0.97 GBP1.00 GBP1.39 GBP1.75 Total ----------- ------------------ --------- --------- --------- --------- --------- --------- ----------- --------- --------- ----------- Balance at 1 September 2012 1.1 863,000 360,000 235,000 400,000 365,000 700,000 4,200,000 484,112 800,000 8,407,112 Granted during the period - - - - - - - - - - - Exercised during the period - - - - - - - - - - - Expired during the period - - - - - - - - - - - ----------- ------------------ --------- --------- --------- --------- --------- --------- ----------- --------- --------- ----------- Balance at 31 August 2013 1.1 863,000 360,000 235,000 400,000 365,000 700,000 4,200,000 484,112 800,000 8,407,112 ----------- ------------------ --------- --------- --------- --------- --------- --------- ----------- --------- --------- -----------
NOTES TO THE FINANCIAL INFORMATION
FOR THE SIX MONTHS ENDED 28 FEBRUARY 2014
11. Post balance sheet events
On 31 March 2014 the Company announced an update on the investment agreement with Zhongrun International Mining Co. Ltd to provide US$ 40 million of funding to implement the capital investment plan at the Vatukoula Gold Mine previously announced on 12 August 2013. As announced on 5 November 2013, the US$ 20 million equity component was completed. Zhongrun informed the Company the second tranche of US$20 million of secured loan notes was delayed until the approval of the State Administration of Foreign Exchange (SAFE) of the People's Republic of China was granted.
The Company and Zhongrun have agreed to vary the terms of the Loan Notes, to match the cashflow requirements of the operations at the Vatukoula Gold Mine in Fiji. In this regard the schedule of payments from Zhongrun will occur in three tranches.
As to date, a total of US$4.6 million of the debt funding has been received.
12. Capital Commitments
Capital commitments as at 28 February 2014 amounted to GBP1,022,076 (31 August 2013; GBP438,900). These commitments are in relation to projected expenditure on mine properties and development.
13. Related party transactions
No related party transactions occurred since the end of last annual reporting period.
14. Contingent liabilities
No significant changes in contingent liabilities occurred since the end of last annual reporting period.
15. Cautionary Statement
The interim results announcement contains forward looking statements. These have been made by the Directors in good faith based on the information available to them up to the time of their approval of this report. The Directors can give no assurance that these expectations will prove to have been correct. Due to the inherent uncertainties, including both economic and business risk factors underlying such forward looking information, actual results may differ materially from those expressed or implied by these forward looking statements. The Directors undertake no obligation to update any forward looking statements whether as a result of new information, future events or otherwise.
There are a number of potential risks and uncertainties which could have a material impact on the Group's performance over the remainder of the financial year and could cause actual results to differ materially from expected and historical results. These include but are not limited to, competitor activity and competition risk, changes in foreign exchange and commodity price and the political and economic risks of operating in Fiji.
16. Approval of interim financial statements
The interim financial statements for the six months ended 28 February 2014 were approved by the board of directors on 20 May 2014.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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