Interim Results
Goldplat plc / Ticker: GDP / Index: AIM / Sector: Mining &
Exploration
12 February 2008
Goldplat plc ('Goldplat' or 'the Company')
Interim Results
Goldplat plc, the AIM listed gold producer, is pleased to announce
its interim results for the six months ended 31 December 2007.
Overview
* Pre-tax profits up 128% to £624,000 (2006: £273,000)
* Excellent continued results at South African recovery plant
* New recovery plant in Ghana completed and now operating at full
capacity - further expansion planned
* Gold mining permissions in place at 50% owned joint venture in
Kenya with processing expected to commence in the second half of
2008
* New South African joint venture company established, in which the
Company has a 74% interest, to take advantage of mining
opportunities in South Africa
Goldplat's Chief Executive Demetri Manolis said, "This has been
another successful period for the Company following progress being
made across all our projects in South Africa, Ghana and Kenya.
Operations at our recovery plant in South Africa have gone from
strength to strength, resulting in a marked improvement in our
pre-tax profits, which I believe will only be significantly enhanced
following the completion of construction at our new plant in Ghana.
With the development of our first gold mining project gaining
momentum, to the extent that we hope to commence processing later in
2008, I believe we are very well placed to build on this financial
performance and create further value for our investors.
Additionally, we continue to evaluate other mining projects across
Africa to expand our business, particularly in South Africa where we
recently formed a joint venture company with a Black Economic
Empowerment ('BEE') partner, which I look forward to updating
shareholders on in the future."
For further information visit www.goldplat.com or contact:
Demetri Manolis, CEO Goldplat plc Tel: +27 11
423 1203
James Joyce/Sarang Shah WH Ireland Limited Tel: 020 7220
1666
Isabel Crossley/Felicity Edwards St Brides Media & Tel: 020 7236
Finance Ltd 1177
CHAIRMAN'S STATEMENT
It gives me great pleasure to report on Goldplat's progress and
financial results for the six months ended 31 December 2007.
Financial Results
The pre-tax profit for the period rose 128% to £624,000 (2006:
£273,000), achieved without any material contribution from our
recovery plant in Ghana, which the Company completed in December
2007. The board is looking at this level of profitability as a
platform for further growth.
Gold Recovery (Pty) Limited
The profit being reported is directly due to the excellent results
achieved at our recovery plant in South Africa, having invested in
new and upgraded existing machinery during 2007. At the same time,
stocks of materials for processing have increased to record levels.
Industrial relations remain good, as does the Company's safety
record. In accordance with the board's strategy, the potential of the
South African business should be considered to be maximised, and
future increases in profits are planned to come from other areas.
Gold Recovery Ghana Limited
The construction of our new recovery plant in Ghana was completed
during the period, and from the beginning of 2008 has been operating
at full capacity. Notably, materials for processing have been
acquired which will satisfy requirements for a number of years. The
next planned expansion at the Company's plant in Tema free port is
the construction of a new line comprising dryer, spirals and furnace
to process fine carbon. The cost, estimated at £100,000, will be paid
from positive cash flow on trading in Ghana.
KilimaPesa Gold (Pty) Limited
The 50% owned joint venture in Kenya is intended to be Goldplat's
first mining venture, capitalising on our team's extensive gold
mining experience, in particular, that of our CEO, Demetri Manolis.
All permissions required for mining are in place and a budget for
plant refurbishment has been agreed. Processing is expected to
commence in the second half of 2008, with gold being extracted from
existing tailings, some 5,000 tonnes of material acquired from local
artisanal miners, as well as ore produced during the mine development
phase.
New Ventures
We recently announced that Goldplat had formed a new joint venture
company in South Africa with Johannesburg Stock Exchange listed
Vunani Group (Proprietary) Limited ('Vunani'). The Company, through
its wholly owned subsidiary Gold Mineral Resources Limited, holds a
74% interest in the joint venture company. Vunani is authorised as a
BEE entity, which will enable the new company to acquire mining
opportunities in South Africa. To this end, initial discussions for
the acquisition of such assets are already taking place.
Future Prospects
Goldplat's strategy is to increase profits and shareholder value with
the minimum of equity dilution. The operations and prospects outlined
above reflect this strategy and the financial results demonstrate its
successful implementation to date. The board looks forward to the
future with confidence.
Recently there has been considerable press comment about political
problems in Kenya and power disruption affecting the mining industry
in South Africa. While these are matters outside Goldplat's control,
I would like to stress that the Company has not experienced any
troubles in Kenya and in South Africa we are cushioned from the
possible effects of temporary closure of deep mines by our levels of
stocks, averaging about two years usage.
Finally, these excellent results have been achieved through the hard
work and dedication of our employees, and I wish to thank them for
their efforts.
Brian Moritz
Chairman
Consolidated Income Statement
for the six months ended 31 December 2007
Six months Six months Year
ended ended ended
December 2007 December 2006 30 June 2007
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Revenue from precious 2,999 2,121 4,962
metals
Cost of Sales (2,144) (1,630) (3,660)
Gross Profit 855 491 1,302
Administrative expenses (253) (225) (533)
Operating profit before 602 266 769
finance costs
Finance income 29 12 30
Finance expense (7) (5) (48)
Net financing income / 22 7 (18)
(costs)
Profit before tax 624 273 751
Income tax expense (245) (99) (182)
Profit for the period 379 174 569
Earnings per share
Basic 0.34p 0.17p 0.58p
Diluted 0.33p 0.16p 0.57p
Consolidated Balance Sheet
at 31 December 2007
Six months ended Six months Year
ended ended
December 2007 December 2006 30 June 2007
(unaudited) (unaudited) (audited)
£'000 £'000 £'000
Assets
Property, plant and 1,912 1,636 1,660
equipment
Goodwill 5,018 5,018 5,018
Non-current assets 6,930 6,654 6,678
Inventories 2,112 313 418
Trade and other 1,195 633 885
receivables
Cash and cash 1,167 723 1,303
equivalents
Current assets 4,474 1,669 2,606
Total Assets 11,404 8,323 9,284
Equity and
liabilities
Issued capital 1,106 1,040 1,090
Share premium 6,657 6,106 6,556
Retained earnings 944 157 569
Exchange reserves (62) (92) (155)
Equity attributable 8,645 7,211 8,060
to equity holders
Minority interest - - -
Total Equity 8,645 7,211 8,060
Liabilities
Provisions 43 25 31
Obligations under - 55 22
finance leases
Deferred tax 323 387 292
liabilities
Non-current 366 467 345
liabilities
Trade and other 1,840 446 545
payables
Obligations under 98 84 67
finance leases
Taxation 335 186
Bank overdraft 120 115 81
Current Liabilities 2,393 645 879
Total Equity and 11,404 8,323 9,284
Liabilities
Cash Flow Statement
for the period ended 31 December 2007
Six months ended Year
ended
December 2007 30 June 2007
(unaudited) (audited)
£'000 £'000
Cash flows from operating
activities
Cash generated from operations 35 584
Financing income 29 30
Financing costs (7) (48)
Income taxes paid (86) -
Net cash flows from operating (29) 566
activities
Cash flows from investing
activities
Proceeds from sale of property, 18 38
plant and equipment
Acquisition of property, plant (365) (457)
and equipment
Net cash outflow from investing (347) (419)
activities
Cash flows from financing
activities
Net proceeds on issues of shares 117 1,671
Acquisition of subsidiary (500)
Net cash acquired from subsidiary 14
Increase in finance leases 9 (71)
Net cash from financing 126 1,114
activities
Net (decrease) / increase in cash (250) 1,261
and cash equivalents
Cash and cash equivalents at 1,222 (39)
beginning of period
Effect of exchange fluctuations 75
on cash held
Cash and cash equivalents at end 1,047 1,222
of period
1. Accounting policies
a) Presentation of financial information
Goldplat plc is incorporated in the United Kingdom under the
Companies Act 1985.
The consolidated financial statements are presented in pounds
sterling, which is considered by the Directors to be the most
appropriate presentation currency for the consolidated
financial statements.
b) Basis of preparation of the financial statements
The financial statements have been prepared in accordance with
International Financial Reporting Standards as adopted by the
EU. The financial statements have been prepared on the
historical cost basis. The principal accounting policies
adopted are set out below.
The preparation of the financial statements requires the
Directors to make estimates and assumptions that affect the
reported amounts of revenues, expenses, assets and
liabilities, and the disclosure of contingent liabilities at
the date of the financial statements. If in the future such
estimates and assumptions, which are based on the Directors'
best judgement at the date of the financial statements,
deviate from the actual circumstances, the original estimates
and assumptions will be modified as appropriate in the year in
which the circumstances change.
c) New Standards and Interpretations
At the date of authorisation of these financial statements,
there were International Reporting Standards and
Interpretations that were in issue but not yet effective,
which have not been applied in preparing these financial
statements.
The Directors anticipate that the adoption of these Standards
and Interpretations in future years will have no impact on the
financial statements except for additional disclosures when
the relevant Standards and Interpretations come into effect.
d) Basis of consolidation
The consolidated financial statements incorporate the
financial statements of the Company and enterprises controlled
by the Company (its subsidiaries) made up to 30 June each
year. Control is achieved where the Company has the power to
govern the financial and operating policies of a subsidiary.
All intra-group transactions, balances, income and expenses
are eliminated on consolidation.
e) Goodwill
The purchase method of accounting is used to account for the
acquisition of subsidiaries. Identifiable assets acquired and
liabilities and contingent liabilities assumed in a business
combination, irrespective of the extent of minority interests,
are measured initially at their fair values at the acquisition
date. The excess of the cost of the acquisition over the fair
value of the Group's share of the identifiable net assets
acquired is recorded as goodwill. If the cost of the
acquisition is less than the fair value of the net assets of
the subsidiary acquired, the difference is accounted for
directly in the income statement. The cost of an acquisition
is measured at the fair value of the assets given, equity
instruments issued and liabilities incurred or assumed at the
date of exchange, plus costs directly attributable to the
acquisition.
f) Property, plant and equipment
Items of property, plant and equipment are stated at
historical cost less accumulated depreciation and impairment
losses. The cost of mining assets includes the costs of
dismantling and removing items and restoring the site on which
they are located.
Where parts of an item of property, plant and equipment have
different useful lives, they are accounted for as separate
items of property, plant and equipment.
Subsequent costs
The Group recognises in the carrying amount of an item of
property, plant and equipment the cost of replacing part of
such an item when that cost is incurred if it is probable that
the future economic benefits embodied with the item will flow
to the Group and the cost of the item can be measured
reliably. All other costs are recognised in the income
statement as an expense as incurred.
Depreciation
Depreciation is charged to the income statement on a
straight-line basis over the estimated useful lives of each
part of an item of property, plant and equipment. Owned land
is not depreciated.
* Leasehold land Lease
Period
* Buildings
20 years
* Plant and equipment 10
years
* Motor vehicles 5
years
* Office equipment 6
years
* Spare parts 10
years
Assets held under finance leases are depreciated over their
expected useful lives on the same basis as owned assets or,
where shorter, over the term of the relevant lease.
Surpluses/(deficits) on the disposal of mining assets, plant
and equipment are credited/(charged) to income. The surplus
or deficit is the difference between the net disposal proceeds
and the carrying amount of the asset.
g) Leases
Leases under the terms of which the Group assumes
substantially all the risks and rewards of ownership are
classified as finance leases. The owner-occupied property
acquired by way of finance lease is stated at an amount equal
to the lower of its fair value and the present value of the
minimum lease payments at inception of the lease, less
accumulated depreciation and impairment losses.
h) Inventories
Inventories are valued at the lower of cost and net realisable
value on the weighted average basis, and include costs
incurred in acquiring the inventories and bringing them to
their existing location and condition. Net realisable value
is the estimated selling price in the ordinary course of
business, less the estimated costs of completion and selling
expenses.
Work-in-progress comprises materials in the process of being
converted from raw materials to finished goods.
Work-in-progress is valued at the lower of cost and net
realisable value on the weighted average basis.
Bullion on hand, gold and platinum in process represent
production on hand after the smelting process, gold contained
in the elution process, gold loaded carbon in the CIL and CIP
processes, gravity concentrates, platinum group metals (PGM)
concentrates and any form of precious metal in process where
the quantum of the contained metal can be accurately
determined. It is valued at the average production cost for
the year, including amortisation and depreciation.
Stores and materials consist of consumable stores and are
valued at the lower of average cost or net realisable value.
i) Provisions
A provision is recognised in the balance sheet when the Group
has a present legal or constructive obligation as a result of
a past event, and it is probable that an outflow of economic
benefits will be required to settle the obligation. If the
effect is material, provisions are determined by discounting
the expected future cash flows at a pre-tax rate that reflects
current market assessments of the time value of money and,
where appropriate, the risks specific to the liability.
j) Income tax
Income tax on the profit or loss for the year comprises
current and deferred tax. Income tax is recognised in the
income statement except to the extent that it relates to items
recognised directly in equity, in which case it is recognised
in equity.
Current tax is the expected tax payable on the taxable income
for the year, using tax rates enacted or substantially enacted
at the balance sheet date, and any adjustment to tax payable
in respect of previous years.
Deferred tax is provided using the balance sheet liability
method, providing for temporary differences between the
carrying amount of assets and liabilities for financial
reporting purposes and the amounts used for taxation
purposes. The following temporary differences are not
provided for: goodwill not deductible for tax purposes, the
initial recognition of assets or liabilities that affect
neither accounting nor taxable profit, and differences
relating to investments in subsidiaries to the extent that
they will probably not reverse in the foreseeable future. The
amount of deferred tax provided is based on the expected
manner of realisation or settlement of the carrying amount of
assets and liabilities using tax rates enacted or
substantively enacted at the balance sheet date.
2. Business and geographical segments
For management purposes, the Company's main activity is that
of a holding Company.
Trading Main activity Country Percentage
Subsidiaries owned
Goldplat Precious South Africa 100 %
Recovery metal
(Pty) Ltd extraction
Gold Precious Ghana 100 %
Recovery metal
Ghana extraction
Limited
KilimaPesa Gold producer Kenya 50 %
Gold (Pty)
Limited
3. Share
capital
December December 2007 June June
2007 2007 2007
£'000 No of shares £'000 No of shares
Authorised
Ordinary shares of 10,000 1,000,000,000 10,000 1,000,000,000
1p
Issued
Issued and fully 1,106 110,560,000 1,090 109,000,000
paid ordinary
shares of 1p
Following a notice of exercise of options on 26 November and 30
November 2007 the Company issued 960,000 and 600,000 ordinary
shares respectively for cash considerations of 7.5p per share.
4. Share based payments
Share options Number of options
During the period ended 31 December 2007 the
Company had the following share options in
issue:
As at 30 June 2007 3,870,000
Granted during the period 1,200,000
Exercised during the period (1,560,000)
3,510,000
2,310,000 options at an exercise price of 7.5p per share and
1,200,000 options, granted during this period at an exercise price
of 10p, remain outstanding as at 31 December 2007.
5. Earnings per share
£'000
The calculation of earnings per ordinary share is
based on the following:
Earnings for the purpose of basic earnings and 379
diluted earnings per share
Number of
shares
Weighted average number of common shares in issue 109,292,173
during the year
Effect of dilutive options 3,510,000
Weighted average number of common shares in issue
during the year for the purpose of diluted 112,802,173
earnings per share
6. Notes to the cash flow
statement
Six months 30
ended June 2007
(unaudited) (audited)
£'000 £'000
Cash generated by
operations
Operating income before 602 769
interest and taxation
Adjustments for:
Depreciation of property, 123 226
plant and equipment
Loss on disposal of property, 7 9
plant and equipment
Operating income before 732 1,004
working capital changes
Increase in inventories (1,694) (149)
Increase in trade and other (310) (492)
receivables
Increase in trade and other 1,307 221
payables
35 584
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