TIDMCEY
RNS Number : 7037H
Centamin Egypt Limited
26 February 2010
CONSOLIDATED FINANCIAL REPORT
FOR THE HALF-YEAR ENDED
31 DECEMBER 2009
CONTENTS
DIRECTORS'
REPORT.........................................................................
................................................................... 1
AUDITOR'S INDEPENDENCE
DECLARATION....................................................................
................................. 1
INDEPENDENT REVIEW REPORT TO THE MEMBERS OF CENTAMIN EGYPT
LIMITED.................................. 4
DIRECTORS'
DECLARATION....................................................................
............................................................ 6
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE
INCOME................................................. 7
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL
POSITION.......................................................... 8
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN
EQUITY........................................................... 1
CONDENSED CONSOLIDATED STATEMENT OF CASH
FLOWS....................................................................... 1
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS..................................................... 1
The Directors of Centamin Egypt Limited ("the Company") herewith submit the
financial report for the half-year ended 31 December 2009. In order to comply
with the provisions of the Corporations Act 2001, the Directors' Report is as
follows:
DIRECTORS
The names of the Directors and officers of the Company during or since the end
of the half-year are:
Mr Sami El-Raghy, Executive Chairman (resigned 31 December 2009)
Mr Josef El-Raghy, Managing Director/CEO
Mr Trevor Schultz, Executive Director of Operations
Mr Colin Cowden, Non Executive Director
Mr G Brian Speechly, Non Executive Director (resigned 31 December 2009)
Dr Thomas Elder, Non Executive Director
Mr H Stuart Bottomley, Non Executive Director
Professor G Robert T Bowker, Non Executive Director
Mr Marco Di Silvio, Chief Financial Officer
Mrs Heidi Brown, Company Secretary
PRINCIPAL ACTIVITIES
The principal activity of the consolidated entity during the course of the
financial year was the exploration for precious and base metals and the ongoing
development and construction work at the Sukari Gold Project in Egypt.
REVIEW OF OPERATIONS
The Company recorded a consolidated operating loss for the period of US$0.5M
compared with a consolidated operating loss of US$24.4M for the corresponding
period last year.
During the half-year the principal focus of the Company has been:
· Continuing mine development and completion of construction activities at
the Sukari Gold Project in Egypt;
· Upgrading the Sukari Mineral Resource to 10.29 Moz Measured and
Indicated, plus 3.4 Moz Inferred at a 0.5g/t cut off grade;
· Commencement of the underground Amun decline development;
· Corporately, successfully transitioning to the main board of the London
Stock Exchange.
In addition to the above activities, two members of the Centamin Board departed
at the end of December 2009. Mr Sami El-Raghy announced he would be stepping
down as the Chairman of Centamin and as a member of the Board at 31 December
2009 to pursue new personal endeavours and challenges. Sami has overseen a
successful transformation of the Company from a mining exploration company into
a significant gold producer. Mr Gordon Brian Speechly also stepped down from
the Board on 31 December 2009 due to other work commitments. Mr Speechly has
been a director of the Company since 15 August 2000. The Company is currently
pursuing the appointment of further appropriate board members.
The Company remains debt free, unhedged and able to aggressively pursue further
exploration and development activities, including the underground development of
the high grade Amun Deeps Zone.
Shareholders are referred to the Company's website (www.centamin.com) for
further details.
ROUNDING OFF OF AMOUNTS
The Company is a company of the kind referred to in ASIC Class Order 98/0100,
dated 10 July 1998, and in accordance with that Class Order amounts in the
Director's Report and the half-year Financial Report are rounded off to the
nearest thousand dollars, unless otherwise indicated.
AUDITOR'S INDEPENDENCE DECLARATION
The auditor's independence declaration is included on page 3 of the half-year
financial report.
Signed in accordance with a resolution of the directors made pursuant to s306(3)
of the Corporations Act 2001.
On behalf of the Directors
Colin Cowden
Director
Perth, 25 February 2010
+----------------------------------+
| The Board of Directors |
| Centamin Egypt Limited |
| 57 Kishorn Road |
| Mt Pleasant WA 6153 |
| |
+----------------------------------+
25 February 2010
Dear Board Members
Centamin Egypt Limited
In accordance with section 307C of the Corporations Act 2001, I am pleased to
provide the following declaration of independence to the directors of Centamin
Egypt Limited.
As lead audit partner for the review of the financial statements of Centamin
Egypt Limited for the half-year ended 31 December 2009, I declare that to the
best of my knowledge and belief, there have been no contraventions of:
(i) the auditor independence requirements of the Corporations Act 2001 in
relation to the review; and
(ii) any applicable code of professional conduct in relation to the review.
Yours sincerely
DELOITTE TOUCHE TOHMATSU
Ross Jerrard
Partner
Chartered Accountants
Independent Auditor's Review Report
to the members of Centamin Egypt Limited
We have reviewed the accompanying half-year financial report of Centamin Egypt
Limited, which comprises the condensed consolidated statement of financial
position as at 31 December 2009, and the condensed consolidated statement of
comprehensive income, the condensed consolidated statement of cash flows and the
condensed consolidated statement of changes in equity for the half-year ended on
that date, selected explanatory notes and the directors' declaration of the
consolidated entity comprising the company and the entities it controlled at the
end of the half-year or from time to time during the half-year as set out on
pages 6 to 17.
Directors' Responsibility for the Half-Year Financial Report
The directors of the company are responsible for the preparation and fair
presentation of the half-year financial report in accordance with Australian
Accounting Standards (including the Australian Accounting Interpretations) and
the Corporations Act 2001. This responsibility includes establishing and
maintaining internal control relevant to the preparation and fair presentation
of the half-year financial report that is free from material misstatement,
whether due to fraud or error; selecting and applying appropriate accounting
policies; and making accounting estimates that are reasonable in the
circumstances.
Auditor's Responsibility
Our responsibility is to express a conclusion on the half-year financial report
based on our review. We conducted our review in accordance with Auditing
Standard on Review Engagements ASRE 2410 Review of Interim and Other Financial
Reports Performed by the Independent Auditor of the Entity, in order to state
whether, on the basis of the procedures described, we have become aware of any
matter that makes us believe that the half-year financial report is not in
accordance with the Corporations Act 2001 including: giving a true and fair view
of Centamin Egypt Limited's financial position as at 31 December 2009 and its
performance for the half-year ended on that date; and complying with Accounting
Standard AASB 134 Interim Financial Reporting and the Corporations Regulations
2001. As the auditor of Centamin Egypt Limited, ASRE 2410 requires that we
comply with the ethical requirements relevant to the audit of the annual
financial report.
Auditor's Independence Declaration
In conducting our review, we have complied with the independence requirements of
the Corporations Act 2001.
Conclusion
Based on our review, which is not an audit, we have not become aware of any
matter that makes us believe that the half-year financial report of Centamin
Egypt Limited is not in accordance with the Corporations Act 2001, including:
(a) giving a true and fair view of the consolidated entity's financial position
as at 31 December 2009 and of its performance for the half-year ended on that
date; and
(b) complying with Accounting Standard AASB 134 Interim Financial Reporting and
the Corporations Regulations 2001.
DELOITTE TOUCHE TOHMATSU
Ross Jerrard
Partner
Chartered Accountants
Perth, 25 February 2009
The directors declare that:
a) 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; and
b) In the directors' opinion, the attached financial statements and notes
thereto are in accordance with the Corporations Act 2001, including compliance
with accounting standards and giving a true and fair view of the financial
position and performance of the consolidated entity.
Signed in accordance with a resolution of the directors made pursuant to s303(5)
of the Corporations Act 2001.
On behalf of the Directors
Colin Cowden
Director
Perth, 25 February 2010
+----------------------------------------------+----------+----------+
| FOR THE HALF YEAR ENDED 31 DECEMBER 2009 | |
+----------------------------------------------+---------------------+
| | Half Year Ended |
+----------------------------------------------+---------------------+
| | 31 December |
+----------------------------------------------+---------------------+
| | 2009 | 2008 |
+----------------------------------------------+----------+----------+
| | US$'000 | US$'000 |
+----------------------------------------------+----------+----------+
| | | |
+----------------------------------------------+----------+----------+
| Revenue - Note 4 | 450 | 2,106 |
+----------------------------------------------+----------+----------+
| | | |
+----------------------------------------------+----------+----------+
| Other income - Note 4 | 886 | 10 |
+----------------------------------------------+----------+----------+
| | | |
+----------------------------------------------+----------+----------+
| Corporate administration expenses | (2,352) | (914) |
+----------------------------------------------+----------+----------+
| | | |
+----------------------------------------------+----------+----------+
| Foreign exchange gain / (loss) | 2,595 | (25,204) |
+----------------------------------------------+----------+----------+
| | | |
+----------------------------------------------+----------+----------+
| Share based payments | (1,477) | (360) |
+----------------------------------------------+----------+----------+
| | | |
+----------------------------------------------+----------+----------+
| Other expenses | (644) | (72) |
+----------------------------------------------+----------+----------+
| | | |
+----------------------------------------------+----------+----------+
| Loss before income tax | (542) | (24,434) |
+----------------------------------------------+----------+----------+
| | | |
+----------------------------------------------+----------+----------+
| Tax (expense) / income | - | - |
+----------------------------------------------+----------+----------+
| | | |
+----------------------------------------------+----------+----------+
| Loss for the period | (542) | (24,434) |
+----------------------------------------------+----------+----------+
| | | |
+----------------------------------------------+----------+----------+
| Other Comprehensive Income | | |
+----------------------------------------------+----------+----------+
| Other Comprehensive Income for the period | - | - |
| (net of tax) | | |
+----------------------------------------------+----------+----------+
| Other Comprehensive Income for the period | - | - |
+----------------------------------------------+----------+----------+
| | | |
+----------------------------------------------+----------+----------+
| | | |
+----------------------------------------------+----------+----------+
| Total Comprehensive Income | (542) | (24,434) |
+----------------------------------------------+----------+----------+
| | | |
+----------------------------------------------+----------+----------+
| Earnings per share - Note 9 | | |
+----------------------------------------------+----------+----------+
| - Basic (cents per share) | (0.05) | (2.78) |
+----------------------------------------------+----------+----------+
| - Diluted (cents per share) | (0.05) | (2.78) |
+----------------------------------------------+----------+----------+
The above Condensed Consolidated Statement of Comprehensive Income
should be read in conjunction with the accompanying notes.
+----------------------------------------+------------+-----------+
| AS AT 31 DECEMBER 2009 | | |
+----------------------------------------+------------+-----------+
| | 31 | 30 June |
| | December | 2009 |
| | 2009 | |
+----------------------------------------+------------+-----------+
| | US$'000 | US$'000 |
+----------------------------------------+------------+-----------+
| CURRENT ASSETS | | |
+----------------------------------------+------------+-----------+
| Cash and cash equivalents | 26,941 | 68,609 |
+----------------------------------------+------------+-----------+
| Trade and other receivables | 1,583 | 30 |
+----------------------------------------+------------+-----------+
| Inventories | 11,009 | 3,780 |
+----------------------------------------+------------+-----------+
| Other assets | 520 | 945 |
+----------------------------------------+------------+-----------+
| Total current assets | 40,053 | 73,364 |
+----------------------------------------+------------+-----------+
| | | |
+----------------------------------------+------------+-----------+
| NON-CURRENT ASSETS | | |
+----------------------------------------+------------+-----------+
| Plant and equipment | 56,960 | 59,879 |
+----------------------------------------+------------+-----------+
| Deferred tax assets | 4,104 | 4,104 |
+----------------------------------------+------------+-----------+
| Exploration, evaluation and | 342,893 | 269,075 |
| development expenditure - Note 5 | | |
+----------------------------------------+------------+-----------+
| Total non-current assets | 403,957 | 333,058 |
+----------------------------------------+------------+-----------+
| | | |
+----------------------------------------+------------+-----------+
| Total assets | 444,010 | 406,422 |
+----------------------------------------+------------+-----------+
| | | |
+----------------------------------------+------------+-----------+
| CURRENT LIABILITIES | | |
+----------------------------------------+------------+-----------+
| Trade and other payables | 8,407 | 7,454 |
+----------------------------------------+------------+-----------+
| Current tax liabilities | 444 | 444 |
+----------------------------------------+------------+-----------+
| Provisions | 1,325 | 606 |
+----------------------------------------+------------+-----------+
| Total current liabilities | 10,176 | 8,504 |
+----------------------------------------+------------+-----------+
| | | |
+----------------------------------------+------------+-----------+
| NON-CURRENT LIABILITIES | | |
+----------------------------------------+------------+-----------+
| Provisions | 2,307 | 1,736 |
+----------------------------------------+------------+-----------+
| Total non-current liabilities | 2,307 | 1,736 |
+----------------------------------------+------------+-----------+
| | | |
+----------------------------------------+------------+-----------+
| Total liabilities | 12,483 | 10,240 |
+----------------------------------------+------------+-----------+
| | | |
+----------------------------------------+------------+-----------+
| NET ASSETS | 431,527 | 396,182 |
+----------------------------------------+------------+-----------+
| | | |
+----------------------------------------+------------+-----------+
| EQUITY | | |
+----------------------------------------+------------+-----------+
| Issued Capital - Note 7 | 454,773 | 416,886 |
+----------------------------------------+------------+-----------+
| Reserves | 6,957 | 8,957 |
+----------------------------------------+------------+-----------+
| Accumulated losses | (30,203) | (29,661) |
+----------------------------------------+------------+-----------+
| TOTAL EQUITY | 431,527 | 396,182 |
+----------------------------------------+------------+-----------+
The above Condensed Consolidated Statement of Financial Position should be read
in conjunction with the accompanying notes.
+-----------------+---------+----------+---------+-------------+----------+
| FOR THE HALF YEAR ENDED 31 DECEMBER 2009 |
+-------------------------------------------------------------------------+
| | Issued | |Options |Accumulated | |
| | |Reserves |Reserve | Losses | Total |
| |Capital | US$'000 |US$'000 | US$'000 | US$'000 |
| |US$'000 | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| At 1 July 2008 | 352,948 | 2,295 | 5,273 | (7,559) | 352,957 |
+-----------------+---------+----------+---------+-------------+----------+
| Loss for the | - | - | - | (24,434) | (24,434) |
| period | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| Total | - | - | - | (24,434) | (24,434) |
| Comprehensive | | | | | |
| Income for the | | | | | |
| period | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| Share options | 811 | - | - | - | 811 |
| exercised | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| Cost of share | - | - | 360 | - | 360 |
| based payments | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| Transfer to | 334 | - | (334) | - | - |
| issued capital | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| At 31 December | 354,093 | 2,295 | 5,299 | (31,993) | 329,694 |
| 2008 | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| At 1 July 2009 | 416,886 | 2,295 | 6,662 | (29,661) | 396,182 |
+-----------------+---------+----------+---------+-------------+----------+
| Loss for the | - | - | - | (542) | (542) |
| period | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| Total | | | | (542) | (542) |
| Comprehensive | | | | | |
| Income for the | | | | | |
| period | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| Share options | 8,959 | - | - | - | 8,959 |
| exercised | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| Cost of share | - | - | 1,477 | - | 1,477 |
| based payments | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| | 25,451 | - | - | - | 25,451 |
| Issue of shares | | | | | |
| under | | | | | |
| employee share | | | | | |
| option plan | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| Transfer to | 3,477 | - | (3,477) | - | - |
| issued capital | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
| At 31 December | 454,773 | 2,295 | 4,662 | (30,203) | 431,527 |
| 2009 | | | | | |
+-----------------+---------+----------+---------+-------------+----------+
The above Condensed Consolidated Statement of Changes in Equity
should be read in conjunction with the accompanying notes.
+----------------------------------------------+----------+------------+
| FOR THE HALF YEAR ENDED 31 DECEMBER 2009 | |
+----------------------------------------------+-----------------------+
| | Half Year Ended |
+----------------------------------------------+-----------------------+
| | 31 December |
+----------------------------------------------+-----------------------+
| | 2009 | 2008 |
+----------------------------------------------+----------+------------+
| | US$'000 | US$'000 |
+----------------------------------------------+----------+------------+
| CASH FLOWS FROM OPERATING ACTIVITIES | | |
+----------------------------------------------+----------+------------+
| Payments to suppliers and employees | (2,913) | (1,423) |
+----------------------------------------------+----------+------------+
| Payments for exploration | (6,198) | (5,142) |
+----------------------------------------------+----------+------------+
| Other income | - | 10 |
+----------------------------------------------+----------+------------+
| Net cash used in operating activities | (9,111) | (6,555) |
+----------------------------------------------+----------+------------+
| | | |
+----------------------------------------------+----------+------------+
| CASH FLOWS FROM INVESTING ACTIVITIES | | |
+----------------------------------------------+----------+------------+
| Payments for development | (70,656) | (48,166) |
+----------------------------------------------+----------+------------+
| Payments for plant & equipment | (3,131) | (7,743) |
+----------------------------------------------+----------+------------+
| Proceeds on sale of plant and equipment | 3,900 | - |
+----------------------------------------------+----------+------------+
| Interest received | 450 | 2,106 |
+----------------------------------------------+----------+------------+
| Net cash used in investing activities | (69,437) | (53,803) |
+----------------------------------------------+----------+------------+
| | | |
+----------------------------------------------+----------+------------+
| CASH FLOWS FROM FINANCING ACTIVITIES | | |
+----------------------------------------------+----------+------------+
| Proceeds from the issue of equity & | 34,410 | 811 |
| conversion of options | | |
+----------------------------------------------+----------+------------+
| Project finance due diligence | (1,343) | (1,573) |
+----------------------------------------------+----------+------------+
| Net cash generated by / (used in) financing | 33,067 | (762) |
| activities | | |
+----------------------------------------------+----------+------------+
| | | |
+----------------------------------------------+----------+------------+
| Net decrease in cash and cash equivalents | (45,481) | (61,120) |
+----------------------------------------------+----------+------------+
| | | |
+----------------------------------------------+----------+------------+
| Cash and cash equivalents at the beginning | 68,609 | 182,329 |
| of the financial period | | |
+----------------------------------------------+----------+------------+
| | | |
+----------------------------------------------+----------+------------+
| Effects of exchange rate changes on the | 3,813 | (23,704) |
| balance of cash held in foreign currencies | | |
+----------------------------------------------+----------+------------+
| | | |
+----------------------------------------------+----------+------------+
| Cash and cash equivalents at the end of the | 26,941 | 97,505 |
| financial period | | |
+----------------------------------------------+----------+------------+
The above Condensed Consolidated Statement of Cash Flows should be read in
conjunction with the accompanying notes.
NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
STATEMENT OF COMPLIANCE
The Half Year report is a general purpose financial report prepared in
accordance with the Corporations Act 2001 and AASB 134 'Interim Financial
Reporting'. Compliance with AASB 134 ensures compliance with International
Financial Reporting Standard IAS 34 'Interim Financial Reporting'. The Half
Year financial report does not include notes of the type normally included in an
annual financial report and should be read in conjunction with the most recent
annual financial report.
BASIS OF PREPARATION
This financial report is denominated in United States Dollars, which is the
functional currency of Centamin Egypt Limited. The Company is of a kind
referred to in ASIC Class Order 98/100 dated 10 July 1998 and in accordance with
that Class Order, all financial information presented in United States Dollars
has been rounded to the nearest thousand dollars, unless otherwise stated.
The financial report has been prepared on the basis of historical cost, except
for the revaluation of certain non-current assets and financial instruments.
Cost is based on the fair values of the consideration given in exchange for
assets.
In the application of A-IFRS, management is required to make judgments,
estimates and assumptions about carrying values of assets and liabilities that
are not readily apparent from other sources. The estimates and associated
assumptions are based on historical experience and various other factors that
are believed to be reasonable under the circumstances, the results of which form
the basis of making the judgments. Actual results may different from these
estimates. The estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the period in which
the estimate is revised if the revision affects only that period, or in the
period of the revision and future periods if the revision affects both current
and future periods.
Judgments made by management in the application of A-IFRS that have significant
effects on the financial statements and estimates with a significant risk of
material adjustments in the next year are disclosed, where applicable, in the
relevant notes to the financial statements.
Accounting policies are selected and applied in a manner which ensures that the
resulting financial information satisfies the concepts of relevance and
reliability, thereby ensuring that the substance of the underlying transactions
or other events is reported.
ADOPTION OF NEW AND REVISED ACCOUNTING STANDARDS
In the current period, the Company has adopted all of the new and revised
Standards and Interpretations issued by the Australian Accounting Standards
Board ("AASB") that are relevant to its operations and effective for annual
reporting periods beginning on or after 1 July 2009. The standards adopted are:
- AASB 3 : "Business Combinations"
- AASB 8 : "Operating Segments"
- AASB 2007-3 "Amendments to Australian Accounting Standards arising from AASB
8"
- AASB 101 : "Presentation of Financial Statements"
- AASB 127 : "Consolidated and Separate Financial Statements"
- AASB 2009-4: "Amendments to Australian Accounting Standards arising from the
Annual Improvements Project"
The adoption of these new and revised Standards and Interpretations has resulted
in some disclosure changes being made.
NOTE 2: SEGMENT REPORTING
The Consolidated Entity has adopted AASB 8 "Operating Segments" and AASB 2007-3
"Amendments to Australian Accounting Standards arising from AASB 8" with effect
from 1 January 2009. AASB 8 requires operating segments to be identified on the
basis of internal reports about components of the Group that are regularly
reviewed by the chief operating decision maker in order to allocate resources to
the segment and to assess its performance. In contrast, the predecessor standard
(AASB 114 "Segment Reporting") required an entity to identify two sets of
segments (business and geographical) using a risks and rewards approach, with
the entity's 'system of internal financial reporting to key management
personnel' serving as the only starting point for the identification of such
segments.
In the case of the Centamin Group, the adoption of AASB 8 has changed the
methodology used to identify segments however the reporting segments that are
disclosed in the financial report remain unchanged.
The Consolidated Entity is engaged in the business of exploration and mining of
precious and base metals only, which is characterised as one operating segment
only. As the consolidated Entity has only one operating segment, all the
necessary reporting disclosures are disclosed elsewhere in the notes to the
financial statements.
NOTE 3: EVENTS SUBSEQUENT TO BALANCE DATE
Other than as set out above, there has not risen in the interval between the end
of the financial year and the date of this report, any item, transaction or
event of a material and unusual nature likely in the opinion of the Directors of
the Company to affect significantly the operations of the company, the results
of those operations, or the state of affairs of the Company in subsequent
financial years.
+------------------------------------------------+---------+---------+
| | Half Year Ended |
| NOTE 4: REVENUE | |
+------------------------------------------------+-------------------+
| | 31 December |
+------------------------------------------------+-------------------+
| | 2009 | 2008 |
+------------------------------------------------+---------+---------+
| |US$'000 |US$'000 |
+------------------------------------------------+---------+---------+
| (a) Revenue | | |
+------------------------------------------------+---------+---------+
| Interest revenue | 450 | 2,106 |
+------------------------------------------------+---------+---------+
| | | |
+------------------------------------------------+---------+---------+
| (b) Other income | | |
+------------------------------------------------+---------+---------+
| Gain on sale of plant and equipment | 886 | - |
+------------------------------------------------+---------+---------+
| VAT refund | - | 10 |
+------------------------------------------------+---------+---------+
| | 1,336 | 2,116 |
+------------------------------------------------+---------+---------+
+------------------------------------------------+----------+---------+
| | Half Year Ended |
| NOTE 5: EXPLORATION, EVALUATION AND | |
| DEVELOPMENT EXPENDITURE | |
+------------------------------------------------+--------------------+
| | 31 | 30 |
| |December | June |
+------------------------------------------------+----------+---------+
| | 2009 | 2009 |
+------------------------------------------------+----------+---------+
| | US$'000 |US$'000 |
+------------------------------------------------+----------+---------+
| Exploration and evaluation phase expenditure - | | |
| At Cost (a) | | |
+------------------------------------------------+----------+---------+
| Balance at the beginning of the period | 26,698 | 21,511 |
+------------------------------------------------+----------+---------+
| Expenditure for the period | 4,968 | 5,187 |
+------------------------------------------------+----------+---------+
| Balance at the end of the period | 31,666 | 26,698 |
+------------------------------------------------+----------+---------+
| | | |
+------------------------------------------------+----------+---------+
| Development expenditure - At Cost (b) | | |
+------------------------------------------------+----------+---------+
| Balance at the beginning of the period | 242,377 | 169,433 |
+------------------------------------------------+----------+---------+
| Expenditure for the period | 68,850 | 72,944 |
+------------------------------------------------+----------+---------+
| Balance at the end of the period | 311,227 | 242,377 |
+------------------------------------------------+----------+---------+
| Net book value of exploration, evaluation and | 342,893 | 269,075 |
| development phase expenditure | | |
+------------------------------------------------+----------+---------+
+----------------------------------------------------------------------+
| |
| (a) Included within the cost amount of exploration evaluation and |
| development assets is $5,311,744 being the excess of consideration |
| over the net tangible assets acquired on the acquisition of Pharaoh |
| Gold Mines NL in January 1999. This amount has been treated as part |
| of the cost of exploration, evaluation and development. Management |
| believe that the recovery of these amounts will satisfactorily be |
| made through the exploitation of the project in due course. |
| |
+----------------------------------------------------------------------+
| (b) Development of the Sukari Gold Project commenced in March |
| 2007. Items of development phase expenditure relevant to the project |
| are being separately accounted for as development phase expenditure. |
+----------------------------------------------------------------------+
NOTE 6: CONTINGENT LIABILITIES
The Directors are not aware of any contingent liabilities as at the date of
these interim consolidated financial statements.
+--------------------------------------------------+-----------+----------+
| NOTE 7: ISSUED CAPITAL | Half Year Ended |
+--------------------------------------------------+----------------------+
| | 31 | 30 June |
| | December | |
+--------------------------------------------------+-----------+----------+
| | 2009 | 2009 |
+--------------------------------------------------+-----------+----------+
| | US$000 | US$000 |
+--------------------------------------------------+-----------+----------+
| Fully paid ordinary shares | | |
+--------------------------------------------------+-----------+----------+
| Balance at beginning of the period | 416,886 | 352,948 |
+--------------------------------------------------+-----------+----------+
| Issue of shares upon exercise of options and | 8,959 | 1,278 |
| warrants | | |
+--------------------------------------------------+-----------+----------+
| Transfer from share options reserve | 3,477 | 1,817 |
+--------------------------------------------------+-----------+----------+
| Other placements | 27,004 | 60,127 |
+--------------------------------------------------+-----------+----------+
| Share issue costs | (1,553) | (3,219) |
+--------------------------------------------------+-----------+----------+
| Tax effect on share issue costs | - | 3,935 |
+--------------------------------------------------+-----------+----------+
| Balance at end of the period | 454,773 | 416,886 |
+--------------------------------------------------+-----------+----------+
Changes to the then Corporations Law abolished the authorised capital and par
value concept in relation to share capital from 1 July 1998. Therefore, the
Company does not have a limited amount of authorised capital and issued shares
do not have a par value. Fully paid ordinary shares carry one vote per share
and carry the right to dividends.
Fully Paid Ordinary Shares
+--------------------------------------------------+---------------+----------+
| | Half Year Ended |
| | 31 December 2009 |
+--------------------------------------------------+--------------------------+
| | Number | US$000 |
+--------------------------------------------------+---------------+----------+
| Balance at beginning of the period | 991,940,623 | 416,886 |
+--------------------------------------------------+---------------+----------+
| Placements | 19,000,000 | 25,451 |
+--------------------------------------------------+---------------+----------+
| Issue of shares on exercise of options and | 9,713,855 | 8,959 |
| broker warrants | | |
+--------------------------------------------------+---------------+----------+
| Transfer from share options reserve | - | 3,477 |
+--------------------------------------------------+---------------+----------+
| Balance at end of the period | 1,020,654,478 | 454,773 |
+--------------------------------------------------+---------------+----------+
Share options granted under the employee share option plan
In accordance with the provisions of the employee share option plans, as at 31
December 2009, executives and employees had options over 6,090,000 ordinary
shares. The expiry dates of the granted options are detailed in Note 10. Share
options granted under the Employee Option Plan carry no rights to dividends and
no voting rights. Further details of the employee share option plan are
contained in Note 10 to the financial statements.
Share warrants on issue
As part of the Canadian listing process undertaken during the previous financial
year on the Toronto Stock Exchange ("TSX") the Company was required to issue to
its nominated share broker share warrants as part of the arrangement. Share
warrants are identical in nature to share options however they are
differentiated as such because the latter in Canada typically relates to options
issued to employees under employee share plans. As at 31 December 2009, there
were 3,603,855 broker warrants on issue over an equivalent number of ordinary
shares (all of which are vested). Further details of the share warrants are
contained in Note 10 to the financial statements.
NOTE 8: RELATED PARTY TRANSACTIONS
The related party transactions for the six months ended 31 December 2009 are
summarised below:
- Salaries, superannuation contributions, consulting and Directors fees
paid to Directors during the six months ended 31 December 2009 amounted to
A$653,499 (31 December 2008: A$712,006).
- Mr S El-Raghy and Mr J El-Raghy are Directors and shareholders of
El-Raghy Kriewaldt Pty Ltd ("ELK"), which provides office premises to the
Company in Australia. All dealings with ELK are in the ordinary course of
business and on normal terms and conditions. Rent paid to ELK during the six
months ended 31 December 2009 amounted to A$32,983 (31 December 2008: A$30,916).
- Mr S El-Raghy provides office premises to the Company in Alexandria,
Egypt. All dealings are in the ordinary course of business and on normal terms
and conditions. Rent paid during the six months ended 31 December 2009 amounted
to GBP 3,900 (31 December 2008: GBP 3,900).
- Mr C Cowden, a non-executive director, is also a director and
shareholder of Cowden Limited, which provides insurance broking services to the
Company. All dealings with Cowden Limited are on normal terms and conditions.
Cowden Limited was paid A$53,239 during the six months ended 31 December 2009
(31 December 2008: A$45,810). In addition, amounts of A$359,969 (31 December
2008: A$283,507) were paid to Cowden Limited to be passed on to underwriters
for premiums during the six months ended 31 December 2009.
An amount of US$150,000 included in non-current liabilities of the condensed
consolidated statement of financial position as at 31 December 2009 represents
an unsecured loan payable after commencement of commercial production at the
Sukari project to Egyptian Mineral Commodities, a company which Mr S El-Raghy
has a financial interest in. This transaction was entered into by the Company on
27 September 2001.
NOTE 9: EARNINGS PER SHARE
Basic earnings per share are calculated using the weighted average number of
shares outstanding. Diluted earnings per share are calculated using the treasury
stock method. In order to determine diluted earnings per share, the treasury
stock method assumes that any proceeds from the exercise of dilutive stock
options and warrants would be used to repurchase common shares at the average
market price during the period, with the incremental number of shares being
included in the denominator of the diluted earnings per share calculation. The
diluted earnings per share calculation exclude any potential conversion of
options and warrants that would increase earnings per share.
The weighted average number of ordinary shares used in the calculation of basic
earnings per share is 996,405,084 (31 December 2008: 878,655,576). The weighted
average number of ordinary shares used in the calculation of diluted earnings
per share is 996,405,084 (31 December 2008: 878,655,576). The earnings used in
the calculation of basic and diluted earnings per share is a loss of US$541,683
(31 December 2008: US$24,434,381).
NOTE 10: SHARE BASED PAYMENTS
The consolidated entity has an Employee Option Plan in place for executives and
employees.
Options are issued to key management personnel under the Employee Option Plan
2006 (previously the Employee Option Plan 2002) as part of their remuneration.
Options are offered to key management personnel at the discretion of the
Directors, having regard, among other things, to the length of service with the
consolidated entity, the past and potential contribution of the person to the
consolidated entity and in some cases, performance.
Each employee share option converts into one ordinary share of the Company on
exercise. The options carry neither rights to dividends nor voting rights.
Options vest over a period of 12 months, with 50% vesting and exercisable after
six months and the other 50% vesting and exercisable after 12 months of issue.
All options are issued with a term of three years. At the discretion of the
Directors part or all of the options issued to an executive or employee may be
subject to performance based hurdles. No performance based hurdles have been
applied for issues granted to date.
In addition, Series 5 options were issued to three employees outside of the
Employee Option Plan on 31 October 2005. Details of those options were:
- 2,500,000 of those options were subject to performance based hurdles.
Due to the cessation of employment by the employee to whom the options were
issued they lapsed in May 2007.
- 1,000,000 of those options vest and are exercisable over a period of two
years, with 50% vesting and exercisable after 12 months and the other 50%
vesting and exercisable after 24 months of issue. These options have a term of 5
years. To date, 650,000 options have been exercised.
- 750,000 of those options vest and are exercisable immediately. These
have a term of 5 years. To date, 250,000 options have been exercised.
In addition to the above:
- 1,630,150 options (Series 18) were issued pursuant with the agreement with
Macquarie Bank Limited to provide a corporate loan facility of up to US$25
million (as announced on 02 April 2009). Those options are exercisable any time
on or before 31 December 2012. No Series 18 options have been exercised at the
date of this report.
- 1,000,000 options (Series 20) were issued pursuant with the agreement with
Ambrian Partners Limited and Investec Bank Plc to provide advisory services
associated with the main board of the London Stock Exchange. Those options are
exercisable any time on or before 28 November 2010. No Series 20 options have
been exercised at the date of this report.
The following reconciles the outstanding share options granted under the
Employee Option Plan, and other share based payment arrangements, at the
beginning and end of the financial year:
+------------------------------------------------------------+-------------+
| | Half |
| | Year |
| | Ended |
| | 31 |
| | December |
| | 2009 |
+------------------------------------------------------------+-------------+
| | Number |
| | of |
| | options |
+------------------------------------------------------------+-------------+
| | |
+------------------------------------------------------------+-------------+
| Balance at beginning of the period (a) | 11,305,150 |
+------------------------------------------------------------+-------------+
| Granted during the period (b) | 1,350,000 |
+------------------------------------------------------------+-------------+
| Exercised during the period (c) | (2,960,000) |
+------------------------------------------------------------+-------------+
| Forfeited, expired or lapsed during the period (d) | (125,000) |
+------------------------------------------------------------+-------------+
| Balance at the end of the period (e) | 9,570,150 |
+------------------------------------------------------------+-------------+
| Exercisable at the end of the period | 9,220,150 |
+------------------------------------------------------------+-------------+
a) Balance at the beginning of the period
+--------------------+------------+---------+-----------+----------+--------+
| Options series | Number | Grant | Expiry / | Exercise | Fair |
| | | date | | price | value |
| | | | Exercise | A$ | at |
| | | | Date | | grant |
| | | | | | date |
| | | | | | A$ |
+--------------------+------------+---------+-----------+----------+--------+
| Series 5 | 1,050,000 | 31 Oct | 31 Oct | 0.3500 | 0.1753 |
| | | 2005 | 2010 | | |
+--------------------+------------+---------+-----------+----------+--------+
| Series 9 | 690,000 | 31 Jan | 31 Jan | 0.7106 | 0.3518 |
| | | 2007 | 2010 | | |
+--------------------+------------+---------+-----------+----------+--------+
| Series 10 | 2,060,000 | 24 May | 24 May | 1.0500 | 0.4661 |
| | | 2007 | 2010 | | |
+--------------------+------------+---------+-----------+----------+--------+
| Series 12 | 250,000 | 15 Oct | 15 Oct | 1.4034 | 0.4002 |
| | | 2007 | 2010 | | |
+--------------------+------------+---------+-----------+----------+--------+
| Series 13 | 3,500,000 | 16 Apr | 16 Apr | 1.7022 | 0.4015 |
| | | 2008 | 2011 | | |
+--------------------+------------+---------+-----------+----------+--------+
| Series 14 | 250,000 | 25 Aug | 25 Aug | 1.1999 | 0.3070 |
| | | 2008 | 2011 | | |
+--------------------+------------+---------+-----------+----------+--------+
| Series 15 | 750,000 | 28 Oct | 28 Oct | 0.7033 | 0.1964 |
| | | 2008 | 2011 | | |
+--------------------+------------+---------+-----------+----------+--------+
| Series 16 | 125,000 | 28 Nov | 28 Nov | 0.6750 | 0.3676 |
| | | 2008 | 2011 | | |
+--------------------+------------+---------+-----------+----------+--------+
| Series 17 | 1,000,000 | 19 Dec | 19 Dec | 1.0000 | 0.3568 |
| | | 2008 | 2011 | | |
+--------------------+------------+---------+-----------+----------+--------+
| Series 18 | 1,630,150 | 15 Apr | 31 Dec | 1.2000 | 0.4326 |
| | | 2009 | 2012 | | |
+--------------------+------------+---------+-----------+----------+--------+
| | 11,305,150 | | | | |
+--------------------+------------+---------+-----------+----------+--------+
b) Granted during the period
+---------------------+-----------+---------+------------+----------+----------+
| Options series | Number | Grant | Expiry / | Exercise | Fair |
| | | date | Exercise | price | value at |
| | | | Date | A$ | grant |
| | | | | | date |
| | | | | | A$ |
+---------------------+-----------+---------+------------+----------+----------+
| Series 19 | 350,000 | 06 Aug | 06 Aug | 1.8658 | 0.7960 |
| | | 2009 | 2012 | | |
+---------------------+-----------+---------+------------+----------+----------+
| Series 20 | 1,000,000 | 28 Nov | 28 Nov | 1.5000 | 0.9258 |
| | | 2009 | 2010 | | |
+---------------------+-----------+---------+------------+----------+----------+
| | 1,350,000 | | | | |
+---------------------+-----------+---------+------------+----------+----------+
c) Exercised during the period
+----------------------------------------+-----------+----------+----------+
| Options series | Number | Exercise | Share |
| | exercised | Date | price at |
| | | | exercise |
| | | | date |
| | | | A$ |
+----------------------------------------+-----------+----------+----------+
| Series 5 | 200,000 | 4 Aug | 1.8250 |
| | | 2009 | |
+----------------------------------------+-----------+----------+----------+
| Series 9 | 25,000 | 01 Jul | 1.7500 |
| | 190,000 | 2009 | 1.8000 |
| | 100,000 | 02 Jul | 1.7200 |
| | 40,000 | 2009 | 1.7250 |
| | 50,000 | 06 Jul | 1.6550 |
| | 100,000 | 2009 | 1.6600 |
| | 45,000 | 07 Jul | 1.8800 |
| | 50,000 | 2009 | 1.8300 |
| | | 08 Jul | |
| | | 2009 | |
| | | 13 Jul | |
| | | 2009 | |
| | | 20 Jul | |
| | | 2009 | |
| | | 22 Jul | |
| | | 2009 | |
+----------------------------------------+-----------+----------+----------+
| Series 10 | 10,000 | 02 Jul | 1.8000 |
| | 30,000 | 2009 | 1.7250 |
| | 130,000 | 07 Jul | 1.6550 |
| | 200,000 | 2009 | 1.8800 |
| | 300,000 | 08 Jul | 1.8000 |
| | 500,000 | 2009 | 1.9200 |
| | 790,000 | 20 Jul | 2.0400 |
| | 100,000 | 2009 | 2.3600 |
| | | 11 Aug | |
| | | 2009 | |
| | | 17 Sep | |
| | | 2009 | |
| | | 15 Oct | |
| | | 2009 | |
| | | 16 Nov | |
| | | 2009 | |
+----------------------------------------+-----------+----------+----------+
| Series 13 | 70,000 | 13 Nov | 2.3500 |
| | 30,000 | 2009 | 2.4600 |
| | | 02 Dec | |
| | | 2009 | |
+----------------------------------------+-----------+----------+----------+
| | 2,960,000 | | |
+----------------------------------------+-----------+----------+----------+
d) Forfeited, expired or lapsed during the period
+----------------------------------------+-----------+----------+----------+
| Options series | Number | Forfeit | Share |
| | forfeited | date | price at |
| | | | forfeit |
| | | | date |
| | | | A$ |
+----------------------------------------+-----------+----------+----------+
| Series 16 | 125,000 | 09 Sep | 1.8850 |
| | | 2009 | |
+----------------------------------------+-----------+----------+----------+
| | 125,000 | | |
+----------------------------------------+-----------+----------+----------+
e) Balance at the end of the period
+-------------------+-----------+---------+-----------+----------+--------+
| Options series | Number | Grant | Expiry / | Exercise | Fair |
| | | date | Exercise | price | value |
| | | | Date | A$ | at |
| | | | | | grant |
| | | | | | date |
| | | | | | A$ |
+-------------------+-----------+---------+-----------+----------+--------+
| Series 5 | 850,000 | 31 Oct | 31 Oct | 0.3500 | 0.1753 |
| | | 2005 | 2010 | | |
+-------------------+-----------+---------+-----------+----------+--------+
| Series 9 | 90,000 | 31 Jan | 31 Jan | 0.7106 | 0.3518 |
| | | 2007 | 2010 | | |
+-------------------+-----------+---------+-----------+----------+--------+
| Series 12 | 250,000 | 15 Oct | 15 Oct | 1.4034 | 0.4002 |
| | | 2007 | 2010 | | |
+-------------------+-----------+---------+-----------+----------+--------+
| Series 13 | 3,400,000 | 16 Apr | 16 Apr | 1.7022 | 0.4015 |
| | | 2008 | 2011 | | |
+-------------------+-----------+---------+-----------+----------+--------+
| Series 14 | 250,000 | 25 Aug | 25 Aug | 1.1999 | 0.3070 |
| | | 2008 | 2011 | | |
+-------------------+-----------+---------+-----------+----------+--------+
| Series 15 | 750,000 | 28 Oct | 28 Oct | 0.7033 | 0.1964 |
| | | 2008 | 2011 | | |
+-------------------+-----------+---------+-----------+----------+--------+
| Series 17 | 1,000,000 | 19 Dec | 19 Dec | 1.0000 | 0.3568 |
| | | 2008 | 2011 | | |
+-------------------+-----------+---------+-----------+----------+--------+
| Series 18 | 1,630,150 | 15 Apr | 31 Dec | 1.2000 | 0.4326 |
| | | 2009 | 2012 | | |
+-------------------+-----------+---------+-----------+----------+--------+
| Series 19 | 350,000 | 06 Aug | 06 Aug | 1.8658 | 0.7960 |
| | | 2009 | 2012 | | |
+-------------------+-----------+---------+-----------+----------+--------+
| Series 20 | 1,000,000 | 28 Nov | 28 Nov | 1.5000 | 0.9258 |
| | | 2009 | 2010 | | |
+-------------------+-----------+---------+-----------+----------+--------+
| | 9,570,150 | | | | |
+-------------------+-----------+---------+-----------+----------+--------+
NOTE 11: SHARE WARRANTS
a) Balance at the start of the period
The following share warrants were in existence during the current reporting
period:-
+--------------------+-----------+--------+----------+----------+----------+
| Broker Warrants | Number | Grant | Expiry |Exercise | Fair |
| series | | date | / | price |value at |
| | | |Exercise | C$ | grant |
| | | | Date | | date |
| | | | | | A$ |
+--------------------+-----------+--------+----------+----------+----------+
| Series 4 | 4,770,720 |10 Jan | 23 Nov | 1.2000 | 0.3782 |
| | | 2008 | 2009 | | |
+--------------------+-----------+--------+----------+----------+----------+
| Series 5 | 4,636,990 |10 Feb | 10 Feb | 0.6500 | 0.4288 |
| | | 2009 | 2011 | | |
+--------------------+-----------+--------+----------+----------+----------+
| | 9,407,710 | | | | |
+--------------------+-----------+--------+----------+----------+----------+
b) Exercised during the period
+----------------------------------------+-----------+----------+----------+
| Warrants series | Number | Exercise | Share |
| | exercised | Date | price at |
| | | | exercise |
| | | | date |
| | | | A$ |
+----------------------------------------+-----------+----------+----------+
| Series 4 | 329,280 | 06 Jul | 1.7200 |
| | 500,000 | 2009 | 1.8400 |
| | 500,000 | 28 Jul | 1.9000 |
| | 500,000 | 2009 | 1.9450 |
| | 500,000 | 04 Sep | 1.8500 |
| | 500,000 | 2009 | 1.8700 |
| | 500,000 | 15 Sep | 2.0900 |
| | 453,040 | 2009 | 2.3400 |
| | 988,400 | 23 Sep | 2.3700 |
| | | 2009 | |
| | | 07 Oct | |
| | | 2009 | |
| | | 23 Oct | |
| | | 2009 | |
| | | 26 Oct | |
| | | 2009 | |
| | | 23 Nov | |
| | | 2009 | |
+----------------------------------------+-----------+----------+----------+
| Series 5 | 1,983,135 | 28 Oct | 2.3100 |
| | | 2009 | |
+----------------------------------------+-----------+----------+----------+
| | 6,753,855 | | |
+----------------------------------------+-----------+----------+----------+
c) Issued during the period
+------------------------+---------+---------+---------+----------+---------+
| Warrants series | Number | Grant | Expiry | Exercise | Fair |
| | | date | Date | price | value |
| | | | | C$ | at |
| | | | | | grant |
| | | | | | date |
| | | | | | A$ |
+------------------------+---------+---------+---------+----------+---------+
| Series 6 | 788,437 | 16 Jul | 16 Jul | 1.5600 | 0.6601 |
| | | 2009 | 2011 | | |
+------------------------+---------+---------+---------+----------+---------+
| Series 7 | 161,563 | 26 Aug | 26 Aug | 1.5200 | 0.5895 |
| | | 2009 | 2011 | | |
+------------------------+---------+---------+---------+----------+---------+
| | 950,000 | | | | |
+------------------------+---------+---------+---------+----------+---------+
d) Balance at the end of the period
+-----------------------+-----------+---------+----------+----------+----------+
| Warrant series | Number | Grant | Expiry / | Exercise | Fair |
| | | date | Exercise | price | value at |
| | | | Date | C$ | grant |
| | | | | | date |
| | | | | | A$ |
+-----------------------+-----------+---------+----------+----------+----------+
| Series 5 | 2,653,855 | 10 Feb | 10 Feb | 0.6500 | 0.4288 |
| | | 2009 | 2011 | | |
+-----------------------+-----------+---------+----------+----------+----------+
| Series 6 | 788,437 | 16 Jul | 16 Jul | 1.5600 | 0.6601 |
| | | 2009 | 2011 | | |
+-----------------------+-----------+---------+----------+----------+----------+
| Series 7 | 161,563 | 26 Aug | 26 Aug | 1.5200 | 0.5895 |
| | | 2009 | 2011 | | |
+-----------------------+-----------+---------+----------+----------+----------+
| | 3,603,855 | | | | |
+-----------------------+-----------+---------+----------+----------+----------+
Share warrants are specific to the Company's listing on the TSX and retain the
same characteristics as share options but are referred to separately under the
TSX listing rules.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR LLFEEFDIEFII
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