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Titanium Resources (SRX)

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Friday 30 September, 2005

Titanium Resources

Interim Results

Titanium Resources Group Ltd
30 September 2005

                          TITANIUM RESOURCES GROUP LTD
                                Interim Results

30 September, 2005

Titanium Resources Group ('TRG' or 'the Group') today announces maiden interim
results for the six months ended 30 June 2005.

Highlights

  • Financial results in line with the Board's expectations at the time of the
    Group's IPO in August 2005.

  • Successful admission to the Alternative Investment Market of the London
    Stock Exchange and raising of £41 million.

  • Demand for the Group's rutile and bauxite remains strong.

  • Refurbishment plans for the Group's rutile and bauxite mines are on budget
    and on schedule, with production from both projects expected to commence in
    the first quarter of 2006.

  • Offtake agreements signed for more than half of the Group's production of
    rutile and negotiations continue with a number of other buyers for the
    remaining production. Interest from buyers exceeds the Group's current
    production capacity.

  • Long term offtake agreements for the Group's entire bauxite production
    already in place.


Commenting on the results, TRG Chairman Walter Kansteiner said:

'The successful IPO provides TRG with the financial strength to accelerate its
restart programme at its flagship mine, Sierra Rutile Limited, and expedite the
completion of Dredge No. 2.'

'Sierra Minerals Holdings' refurbishment of the bauxite operation is well
underway. PW Mining International Limited is completing the refurbishment
programme and will operate the mine following commissioning.'

'Both operations are on track to begin production first quarter 2006.'

Contacts
Walter Kansteiner
Titanium Resources Group
Telephone: +44 20 7321 0000

Michael Oke / Andy Mills
Aura Financial
Telephone: +44 20 7321 0000
Mobile: +44 7841 748 911



CHAIRMAN'S REVIEW

The first six months of 2005 proved a pivotal period for Titanium Resources
Group following  the Group's listing on the Alternative Investment Market ('AIM
') of the London Stock Exchange in August.  The successful IPO provided TRG with
the financial strength to accelerate the restart programme at its flagship
rutile mine, Sierra Rutile Limited, and to fund the restart of the Group's SML
Bauxite Project. With the successful completion of the IPO, the TRG Board will
be able to make operational decisions, independent of any single shareholder.

TRG successfully raised approximately £41 million through an institutional
placing of 87.1 million shares at 47p per share.  TRG's shares were admitted to
AIM for trading on 25 August 2005.  The AIM offering increased the Group's
financial resources and raised its profile in the mineral sands industry.

Consolidated financial statements have been prepared for the first six months
ended 30 June 2005.  As indicated in the accountants' report contained in the
Group's AIM admission document, as of 31 December 2004 the combined companies
did not constitute a legal group and the individual financial accounts of the
companies were aggregated.  Accordingly, historical comparative consolidated
financial information is not available for this period. However, the Board
regards these results as having been prepared under IFRS and as in line with the
financial statements for the full year set out in the Group's AIM Admission
Document.

Expenditures during the period relate mainly to ongoing restart activities with
full-scale refurbishment of the Sierra Rutile Project beginning May 2005.
Full-scale bauxite refurbishment started in June 2005 and is scheduled for
completion by the first quarter of 2006.

As previously reported, on 1 March 2005, Sierra Rutile Limited ('SRL') received
the first disbursement amounting to Euro 18 million of the EU borrowing facility
secured through the Government of Sierra Leone.  Interest is payable at the rate
of 8% per annum with the first interest payment due in 2008.  The repayment is
in 10 equal instalments with the first repayment due on 1 March 2012.

REFURBISHMENT PLAN

The Group has successfully accelerated the restart of the rutile mine without
impeding restart operations of the bauxite mine.  Both operations are on track
to begin production in the first quarter of 2006. Dredge D1 is expected to
produce 100,000 tonnes of product in 2006.  The bauxite mine is expected to
produce at least 1.2 million tonnes in 2006.

Sierra Minerals Holdings' refurbishment of the bauxite operation is well
underway. PW Mining International Limited is completing the refurbishment
programme and will operate the mine following commissioning.

MARKET OUTLOOK

Titanium

Demand for SRL's high quality rutile is strong and SRL has signed sales
contracts for more than half of its production and is negotiating with a number
of buyers for the remainder of its production. Interest from buyers exceeds
SRL's current production capacity.

2004 saw a major increase in world titanium dioxide pigment demand to
approximately 4.6 million tonnes with a number of pigment producers seeking to
implement additional production capacity through the de-bottlenecking and
brown-field expansion of existing manufacturing facilities. In addition, the
industry witnessed additional demand for high-titanium bearing minerals as a
result of  increased requirements from titanium sponge producers and other
industrial markets such as welding rods because of higher construction activity.
While overall pigment demand eased in the first half of 2005, plants using
high-titanium ores, such as those produced at SRL, are operating at or near full
capacity.

SRL will produce two grades of rutile, namely Standard Grade rutile and
Industrial Grade rutile. Standard Grade rutile is principally destined for
consumption in the manufacturing of titanium dioxide pigments via the chloride
process and titanium sponge. Industrial Grade rutile is specifically produced
for the welding rod, thermal insulation and ceramics markets.

At the current pace of sales, the production of Standard Grade rutile from SRL's
operation should be fully committed on contract shortly, with terms extending up
to five years. In addition, the Group has received considerable interest from
the industrial market segment, with extensive product testing and evaluation
currently being undertaken by potential customers throughout the world.
Commercial negotiations to secure long-term contracts are being undertaken by
The Natural Rutile Company Limited, the marketing business which is a wholly
owned subsidiary of TRG.

Bauxite

Sierra Minerals Holdings 1, Ltd will produce 1.2 million tonnes of
metallurgical-grade bauxite in 2006, which has been sold on contract to two
major producers of aluminium. World demand for bauxite for the first half of
2005 continues to be very strong, and the Group is evaluating ways to increase
production to take advantage of the strong market.

TITANIUM RESOURCES GROUP LTD
UNAUDITED CONSOLIDATED BALANCE SHEET AS AT 30 JUNE 2005

                                                                            Note            2005
                                                                                          USD'000
ASSETS

Non-current assets
Intangible assets                                                             4             6,720
Property, plant and equipment                                                              47,021
Non-current receivables                                                                       741
Deferred tax assets                                                           5            43,680

                                                                                           98,162

Current assets
Inventories                                                                                 7,059
Trade and other receivables                                                                    70
Bank balances and cash                                                                     30,323

                                                                                           37,452

TOTAL ASSETS                                                                              135,614

EQUITY AND LIABILITIES

Capital and reserves
Share capital                                                                               1,050
Share consideration                                                           6            99,000
Revenue deficit                                                                            (2,632)
Shareholders' interests                                                                    97,418

Non-current liabilities
Provision for liabilities and charges                                                       2,017
Borrowings                                                                                 24,990
Non-current payables                                                                        3,855

                                                                                           30,862

Current liabilities
Trade and other payables                                                                    6,760
Provisions for liabilities and charges                                                        358
Current tax liability                                                                         216

                                                                                            7,334

TOTAL EQUITY AND LIABILITIES                                                              135,614



TITANIUM RESOURCES GROUP LTD

UNAUDITED CONSOLIDATED PROFIT AND LOSS STATEMENT FOR THE SIX MONTHS ENDED 30 JUNE 2005

                                                                                            2005
                                                                                          USD'000

Operating revenue                                                                               -

Cost of sales                                                                                   -

Gross profit                                                                                    -

Other income                                                                                    -

Operating expense                                                                               -

Administrative expenses                                                                      (820)

Other operating expenses                                                                     (227)

Exceptional item                                                                             (663)

Operating loss                                                                             (1,710)

Finance costs                                                                                (872)

Net loss                                                                                   (2,582)

Taxation                                                                                        -

Net loss for the period                                                                    (2,582)



TITANIUM RESOURCES GROUP LTD

UNAUDITED CONSOLIDATED CASH FLOW STATEMENT FOR THE PERIOD SIX MONTHS ENDED 30 JUNE 2005

                                                                                             2005
                                                                                           USD'000


Cash flows from operating activities
Net generated from operations                                                               13,558

Investing activities
Purchase of property, plant and equipment                                                   (7,212)

Net cash used in investing activities                                                       (7,212)

Financing activities
Proceeds from long-term borrowings                                                          23,875
Net cash provided by financing activities                                                   23,875

Net increase in cash and cash equivalents                                                   30,221

Movement in cash and cash equivalents                       
At January 1,                                                                                  102
Increase                                                                                    30,221

At June 30,                                                                                 30,323




TITANIUM RESOURCES GROUP LTD

NOTES TO THE FINANCIAL STATEMENTS - 30 JUNE 2005

1.  BASIS OF PREPARATION

The financial statements have been prepared in accordance with International
Financial Reporting Standards.

2.  CONSOLIDATED FINANCIAL STATEMENTS

The consolidated financial statements incorporate the financial statements of
the Group and enterprises controlled by the Group (its subsidiaries).  Control
is achieved where the Group has the power to govern the financial and operating
policies of an investee enterprise so as to obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the year are
included in the consolidated profit and loss account from the date of their
acquisition or up to the date of their disposal.

The consolidated financial statements have been prepared in accordance with the
purchase method.  Goodwill is initially measured at cost.  After initial
recognition, goodwill is measured at cost less any accumulated losses.  The
results of subsidiaries which are not consolidated are brought into the
financial statements to the extent of dividends received.

All significant inter company transactions, balances and unrealised gains on
transactions are eliminated.  Unrealised losses are also eliminated unless cost
cannot be recovered.

Where necessary, adjustments are made to the financial statements of
subsidiaries to bring the accounting policies used into line with those used by
other members of the Group.

3.  INVESTMENTS IN SUBSIDIARIES

The subsidiary companies are as follows:
                                                                        % Holding
•       Global Aluminium Ltd                                               100
•       Sierra Mineral Holdings 1, Ltd                                     100
•       Bauxite Marketing Ltd                                              100
•       Titanium Fields Resources Ltd                                      100
•       SRL Acquisition No.1 Ltd 'A' Share*                                100
•       The Natural Rutile Company Ltd                                     100
•       SRL Acquisition No.3, Ltd                                          100
•       Sierra Rutile Holdings Ltd                                         100
•       Sierra Rutile Ltd                                                  100

4.  INTANGIBLE ASSETS

Intangible assets represent goodwill arising on the acquisition of the
subsidiaries.
                                                                   USD'000

Fair value of shares issued                                          1,000
Convertible into shares                                             99,000
                                                                   100,000
Fair value of net assets acquired                                 (93,280)
Goodwill                                                             6,720

5.  DEFERRED TAX ASSET

Deferred tax asset is made up as follows:
                                                                   USD'000

Sierra Rutile Limited                                               43,579
Sierra Mineral Holdings 1 Ltd                                          101
                                                                    43,680

6.  SHARE CONSIDERATION

The share consideration represents the balance of convertible shares which will
be issued in TRG after the period end in respect of the acquisition of Global
Aluminium Ltd and Titanium Fields Resources Ltd.

7.  PAR VALUE OF SHARES

The common shares have no par value.


* Nord Resources Corp. holds one 'B' share under an agreement dated 16 June
1999, the details of which are set in paragraph 10.9 of Part 5 of the TRG AIM
Admission Document (p. 103).


                      This information is provided by RNS
            The company news service from the London Stock Exchange