Information  X 
Enter a valid email address

Karelian Diamond Res. PLC (KDR)

  Print      Mail a friend

Wednesday 25 February, 2015

Karelian Diamond Res. PLC

Half-yearly Report


                                                                               
                                                               25 February 2015

Karelian Diamond Resources plc

("Karelian" or "the Company")

         Half-yearly results for the six months ended 30 November 2014         

                           SIGNIFICANT PROGRESS MADE                           

Karelian Diamond Resources plc (AIM: KDR; ESM: KDR.I), the diamond exploration
company focused on Finland, announces its results for the six months ended 30
November 2014; a period during which the Company made excellent progress.

Highlights:

  * Riihivaara samples in Eastern Finland shown to come from diamond stability
    field
   
  * Presence of eclogitic material in samples suggests source relatively close
   
  * Eclogitic materials tend to be associated with richer diamond grades
   
  * Agreement with Rio Tinto extended
   
Professor Richard Conroy, Chairman, commented:

"We have successfully progressed our diamond exploration programme in Finland
with results at Riihivaara suggesting the close proximity of a new kimberlite
discovery".

Further Information:

Professor Richard Conroy, Chairman/ Karelian Diamond       Tel: +353-1-661-8958
Resources plc                                                                  
                                                                               
Virginia Bull/Simon Clements/ SanlamSecurities UKLimited   Tel: +44-20-7628-2200                
(Nomad)                                                       
                                                                               
Jon Belliss/ Abigail Wayne/Hume CapitalSecurities PLC      Tel: +44-20-3693-1493               
(Broker)                                                       
                                                                               
Ger Heffernan/IBI Corporate Finance Limited (ESM Adviser)  Tel +353-766-234-800
                                                                               
Michael Padley/ Lothbury Financial Services                Tel: +44-20-3440-7620               
                                                               
Don Hall/ Hall Communications                              Tel: +353-1-660-9377

Visit the website at: www.kareliandiamondresources.com


                             CHAIRMAN'S STATEMENT                              

Dear Shareholder,

I have great pleasure in presenting your Company's Half-Yearly Report for the
six months ended 30 November 2014. During this period excellent progress
continued to be made with the diamond exploration programme in the Karelian
Craton in Finland, the objective of which is to discover a world class diamond
deposit. Also during the period your Company's confidentiality agreement (with
Back in Rights) with Rio Tinto Mining and Exploration Ltd ("Rio Tinto") was
extended to 2020.

Diamond Exploration Programme

Your Company's primary exploration area is in the Karelian Craton in North
Eastern Europe where, in the Finnish sector of the Craton, we hope to discover
a diamond orebody comparable to the world class diamond deposits, Lomonosova
and the Grib Pipe, which have been discovered in the Russian sector of the
craton.

The Karelian Craton, which extends across Finland and northwest Russia, is
comparable in size to the diamond rich Slave Lake Craton in Canada. The Russian
diamond company ALROSA Company Limited (Closed Joint-Stock Company), which is
now the world's largest diamond miner, has indicated recently that the Karelian
Craton region will represent almost all of its future growth.

Your Company's diamond exploration programme in Finland covers five regions
and, at Seitaperä in Eastern Finland, the programme has outlined the largest
diamondiferous pipe yet discovered in Finland.

Recent exploration results from your Company's Riihivaara target in Eastern
Finland have been particularly exciting. Sample material from the target area
has been confirmed as being derived from the diamond stability field of the
Earth's mantle. Eclogite mantle materials are present which is significant, as
these tend to be associated with richer diamond grades.

Detailed analysis of the sample material from Riihivaara was carried out by
Scanning Electron Microscopy (SEM) at the Geological Survey of Finland (GTK)
laboratory in Helsinki. The laboratory results have demonstrated the presence
of 27 Group 2 eclogite grains, plus 8 Harzburgitic G10 garnets including a G10
(D), as well as 33 Lherzolite G9 garnets, 27 megacrysts and 1 Wehrlitic grain.

The presence of what are known as Harzburgitic G10 garnets, including in
particular a G10(D), confirmed that the sample material is derived from the
diamond stability field of the Earth's mantle. Follow up exploration is under
way at Riihivaara.

Exploration continues also on your Company's other diamond targets in Finland,
particularly in the Kuhmo and Kuusamo areas of Eastern Finland.

Agreement with Rio Tinto Mining & Exploration

The existing Confidentiality Agreement (with Back in Rights), as announced on
22 July 2010, with Rio Tinto Mining and Exploration Limited ("Rio Tinto") has
been extended until 30 June 2020.

Under the agreement, Rio Tinto discloses to Karelian confidential information
and physical geological samples relating to exploration in Finland for the
purpose of the Company considering that information in relation to its own
existing and potential exploration programmes in Finland.

To date this information has included data on over 53,000 till samples, over
600 analytical results, data on Kimberlite indicator minerals from over 200
locations and records on the discovery of 122 diamonds. The integration of this
data with your Company's own data has been of great benefit.

In consideration of Rio Tinto disclosing the confidential information to it,
Karelian has agreed that Rio Tinto will have the option to earn a 51 per cent.
interest in any project identified by Karelian in Finland by Rio Tinto paying
the direct cash expenditures incurred in developing the project, subject to the
following conditions:

 1. For diamond projects the option will be triggered if Karelian completes 10
    tonnes or more of bulk sampling for diamond exploration; and
   
 2. For all other minerals the option will be triggered if Karelian discovers a
    resource with an in situ value that is equal to or greater than the in situ
    value of 3 million ounces of gold in a JORC compliant resource calculation.
   
Finance

The loss after taxation for the half-year ended 30 November 2014 was €121,087
(2013: loss of €96,610) and the net assets as at 30 November 2014 were €
8,319,399 (2013: €4,363,079).

At the Annual General Meeting a resolution extending the directors' warrants by
five years was passed.

Directors and Staff

I would like to thank my fellow directors, staff and consultants for their
support and dedication, which has enabled the continued success of the Company.

I am also pleased to welcome Dr Sorċa Conroy to the Board with her
broad-ranging city experience. Her knowledge, skills and experience will
significantly contribute to the Company as it moves forward.

Outlook

We have made a significant amount of progress in the period and expect this to
continue as we move forward with your Company's diamond interests in Finland.

Yours faithfully,

Professor Richard Conroy

Chairman

25 February 2015



                               INCOME STATEMENT                                

                     FOR HALF-YEAR ENDED 30 NOVEMBER 2014                      

                                        Six months      Six months         Year 
                                             ended           ended        ended      
                                       30 November     30 November       31 May
                                              2014            2013         2014
                                       (Unaudited)     (Unaudited)    (Audited)
                                                 €               €            €
                                                                               
OPERATING EXPENSES                       (122,808)        (89,123)    (191,139)
                                                                               
Finance income - bank interest               1,721               -          699
receivable                                                                     
                                                                               
Finance costs - interest on                      -         (7,487)      (8,451)
shareholder loan                                                               
                                                                               
LOSS BEFORE TAXATION                     (121,087)        (96,610)    (198,891)
                                                                               
Taxation                                         -               -            -
                                                                               
LOSS FOR THE YEAR                        (121,087)        (96,610)    (198,891)
                                                                               
Loss per ordinary share - basic          (€0.0004)        (€0.001)    (€0.0013)
and diluted                                                                    


                       STATEMENT OF COMPREHENSIVE INCOME                       

                     FOR HALF-YEAR ENDED 30 NOVEMBER -2014                     

                                        Six months      Six months         Year 
                                             ended           ended        ended     
                                       30 November     30 November       31 May
                                              2014            2013         2014
                                       (Unaudited)     (Unaudited)    (Audited)
                                                 €               €            €
                                                                               
LOSS FOR PERIOD                          (121,087)        (96,610)    (198,891)
                                                                               
Total income and expense                         -               -            -
recognised in other comprehensive                                              
income                                                                         
                                                                               
TOTAL COMPREHENSIVE INCOME FOR THE       (121,087)        (96,610)    (198,891)
PERIOD - ENTIRELY ATTRIBUTABLE TO                                              
EQUITYHOLDERS                                                                  
                                                                               


                        STATEMENT OF FINANCIAL POSITION                        

                            AS AT 30 NOVEMBER 2014                             

                                       30 November    30 November        31 May
                                              2014           2013          2014
                                        (Unaudited)    (Unaudited)     (Audited)
ASSETS                                           €              €             €
                                                                               
Non-current Assets                                                             
                                                                               
Intangible assets                        7,609,850      7,068,402     7,329,228
                                                                               
Investment in Subsidiary                         4              4             4
                                                                               
Property, plant and equipment                    0            249           165
                                                                               
                                         7,609,854      7,068,655     7,329,397
                                                                               
Current Assets                                                                 
                                                                               
Trade and other receivables                307,309          7,051        55,779
                                                                               
Cash and cash equivalents                  924,748          4,271     2,105,041
                                                                               
                                         1,232,057         11,322     2,160,820
                                                                               
Total Assets                             8,841,911      7,079,977     9,490,217
                                                                               
EQUITY AND LIABILITIES                                                         
                                                                               
Capital and Reserves                                                           
                                                                               
Called up share capital                  2,865,350        922,083     2,865,350
                                                                               
Share premium                            6,786,177      4,621,158     6,786,177
                                                                               
Share based payments reserve               559,118        487,716       525,275
                                                                               
Retained losses                        (1,891,246)    (1,667,878)   (1,770,159)
                                                                               
Total Equity                             8,319,399      4,363,079     8,406,643
                                                                               
Non-current Liabilities                                                        
                                                                               
Financial Liabilities                      309,589      1,212,404       309,589
                                                                               
Total Non-current Liabilities              309,589      1,212,404      309,-589
                                                                               
Current Liabilities                                                            
                                                                               
Trade and other payables                   212,923      1,504,494       773,985
                                                                               
Total Current Liabilities                  212,923      1,504,494       773,985
                                                                               
Total Liabilities                          522,512      2,716,898     1,083,574
                                                                               
Total Equity and Liabilities             8,841,911      7,079,977     9,490,217


                        STATEMENT OF CHANGES IN EQUITY                         

                   FOR THE HALF-YEAR ENDED 30 NOVEMBER 2014                    

                                             Share-based     Retained          
                          Share        Share      Payment    Earnings     Total
                        Capital      Premium      Reserve   (Deficit)    Equity
                              €            €            €           €         €
                                                                               
At 1 June 2014        2,865,350    6,786,177      525,275 (1,770,159) 8,406,643
                                                                               
Share-based payments          -            -       33,843           -    33,843
                                                                               
Loss for the period           -            -            -   (121,087) (121,087)
                                                                               
At 30 November -2014  2,865,350    6,786,177      559,118 (1,891,246) 8,319,399
                                   
                                            
                                             Share-based     Retained          
                          Share        Share      Payment    Earnings     Total
                        Capital      Premium      Reserve   (Deficit)    Equity
                              €            €            €           €         €
                                                                               
At 1 June 2013          922,083    4,621,158      450,157 (1,571,268) 4,422,130
                                                                               
Share-based payments          -            -       37,559           -    37,559
                                                                               
Loss for the period           -            -            -    (96,610)  (96,610)
                                                                               
At 30 November 2013     922,083    4,621,158      487,716 (1,667,878) 4,363,079
                                                                               

                              CASH FLOW STATEMENT                              

                   FOR THE HALF-YEAR ENDED 30 NOVEMBER 2014                    

                                           Six months     Six months       Year 
                                                ended          ended      ended     
                                          30 November    30 November     31 May
                                                 2014           2013       2014
                                          (Unaudited)    (Unaudited)  (Audited)
                                                    €              €          €
                                                                               
Cash flows from operating activities                                           
                                                                               
Cash (used in)/generated by operations      (930,224)        197,602  (147,489)
                                                                               
Tax paid                                            -              -          -
                                                                               
Net cash (used in)/generated by             (930,224)        197,602  (147,489)
operating activities                                                           
                                                                               
Cash flows from investing activities                                           
                                                                               
Investment in exploration and               (251,790)      (236,273) (-432,548)
evaluation                                                                     
                                                                               
Net cash used in investing activities       (251,790)      (236,273) (-432,548)
                                                                               
Cash flows from financing activities                                           
                                                                               
Issue of share capital (net of                      -              -  3,025,788
expenses)                                                                      
                                                                               
Advances/(Repayment) of shareholder                 -         40,436  (343,915)
loan                                                                           
                                                                               
Bank interest received                          1,721              -        699
                                                                               
Net cash generated from financing               1,721         40,436  2,682,572
activities                                                                     
                                                                               
(Decrease)/Increase in cash and cash      (1,180,293)          1,765  2,102,535
equivalents                                                                    
                                                                               
Cash and cash equivalents at beginning      2,105,041          2,506      2,506
of period                                                                      
                                                                               
Cash and cash equivalents at end of           924,748          4,271  2,105,041
period                                                                         


                       NOTES TO THE FINANCIAL STATEMENTS

                   FOR THE HALF-YEAR ENDED 30 NOVEMBER 2014                   

1. Basis of preparation

The half-yearly financial statements have been prepared on the basis of the
recognition and measurement requirements of International Financial Reporting
Standards (IFRS) as adopted by the European Union (EU), and their
interpretations adopted by the International Accounting Standards Board (IASB).
The accounting policies used in the preparation of the half-yearly financial
information are the same as those used in the Company's audited financial
statements for the year ended 31 May 2014.

2. Earnings per share

The calculation of the loss per ordinary share of €0.0004 (2013: loss €0.001)
is based on the loss for the financial period of €121,087 (2013: loss €96,610)
and the weighted average number of ordinary shares in issue during the period
of 286,535,034 (2013: 92,308,242).

Since the Company incurred a loss the effect of share options and warrants
would be anti-dilutive.

3. Dividends

No dividends were paid or are proposed in respect of the half-year ended 30
November 2014.

4. Copy of half-yearly report

A copy of the half- yearly report will be available on the Company's website 
www.kareliandiamondresources.com and will be available from the Company's
registered office, 10 Upper Pembroke Street, Dublin 2.

a d v e r t i s e m e n t