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CZA
CZA
CZA - CoAL of Africa - Final Results for the Year Ended 30 June 2008
Coal of Africa Limited
(previously "GVM Metals Limited")
(Incorporated and registered in Australia)
(Registration number ABN 008 905 388)
Share code on the JSE Limited: CZA
ISIN AU000000CZA6
Share code on the Australian Stock Exchange Limited: CZA
ISIN AU000000CZA6
(`CoAL` or `the Company`)
30 September 2008
Final Results for the Year Ended 30 June 2008
Coal of Africa Limited ("CoAL" or "the Company", ticker "CZA"), the
AIM/ASX/JSE listed coal development company operating in South Africa, is
pleased to announce its final results for the year ended 30 June 2008.
* Acquisition of a 70% interest in the Mooiplaats coal project in
February
2008.
* Acquisition of the remaining 30% of the Mooiplaats coal project in
April
2008.
* Replacement of Motjoli Resources (Pty) Ltd by companies associated
with the Mvelaphanda Group as a significant shareholder and CoAL`s
Black Economic Empowerment partner in South Africa. The change enables
the Company to comply with the BEE ownership as stipulated in the
South African Minerals and Petroleum Resources Development Act.
* ArcelorMittal, currently CoAL`s second largest shareholder and the
world`s largest steel producer, agreed to purchase between 2.5 and 5
million tonnes p.a. of hard coking coal from the Company`s Makhado and
Vele projects located in the Limpopo province.
The full Annual Report will be posted to shareholders and is available on
the Company`s website www.coalofafrica.com
For more information contact:
Simon Farrell, Managing Director
GVM
+61 417 985 383 or +61 8 9322 6776
Petronella Gorrie
The Event Shop
+27 82 827 8815
Jos Simson/ Gareth Tredways
Conduit PR
+44(0) 20 7429 6603
Olly Cairns / Romil Patel
Blue Oar Securities Plc
+61 8 6430 1631/ +44(0) 20 7448 4400
Operational Review
Mooiplaats Thermal Coal Project (100%)
During the year CoAL acquired 70% of the Mooiplaats coal project in
February and the remaining 30% in April 2008 which included the Mining
Rights for portions one and nine of the farm Mooiplaats as well as
Prospecting Rights for various neighbouring farms. New Order Prospecting
Rights for the farms De Emigratie, Willemsdal and Klipfontein encompassing
an area of 9,260 Ha were secured and the Directors believe that these farms
have the potential to add significant additional coal resources to the
project.
The Mooiplaats coal project currently has coal resources of 113 million
tonnes of which 88.2 million tonnes are `Measured` in terms of the JORC/
SAMREC codes consisting of mainly bituminous (thermal) and lean coal. The
Mooiplaats coal project is situated less than two kilometres from the
recently re-commissioned Camden power station near Ermelo in the Mpumalanga
province of South Africa. An in-fill drilling programme of over 37,000
metres was completed during the financial year taking the exploration
metres drilled on the project to over 65,000 metres. Additional holes were
drilled to enable water monitoring and production holes were drilled to
confirm production expectations. Results of the production related drilling
were included the geological model, allowing for the finalisation of
production scheduling and the mining contract. The Company re-built the
geological model internally to verify the model presented by the potential
contract miner. This model has been submitted to independent mine planners
who are generating life-of-mine schedules.
Negotiations with the surface rights owner were concluded allowing access
to the mine site as well as de-watering and rehabilitation of the existing
decline shaft and preparation of the surrounding areas for mining activity.
Mining is expected to commence towards the end of 2008 followed soon
thereafter by production. Negotiations with the contract miner have been
finalised and the supply of mining equipment and infrastructure have been
secured with delivery of the first Continuous Mining machine scheduled for
October 2008. The supply of the wash plant has been secured with
commissioning of the plant expected by the end of February 2009. Additional
production related drilling and drilling to identify the site for the
second decline shaft has commenced on the neighbouring farms, Klipbank and
Adrianople.
Discussions with potential off-take customers progressed during the period
under review and included the potential export of lean coal to Europe. The
Company signed a non-exclusive marketing agreement for the project with
Oreport (Pty) Ltd and secured long term port allocation through the
Richards Bay dry bulk terminal operated by subsidiaries of Grindrod
Limited. The throughput agreement provides CoAL with an allocation of
900,000 tonnes of coal per annum commencing in 2009 and the ability to
secure 50% of any increased capacity at the terminal. The increased
capacity will require pro rata funding by CoAL but gives the Company the
potential to increase its export capacity to 3 million tonnes per annum
once the terminal expansion has been completed.
Makhado (previously Baobab) Coking Coal Project (100%)
Extensive exploration activities and infrastructure studies were undertaken
on the 100% owned Makhado coal project near Louis Trichardt in South
Africa`s Limpopo province. A detailed Aeromagnetic survey covering over
60,000 ha was completed and included the Makhado, Vele and Tshikunda
project areas and the results of the survey were used to compile an in-
depth geophysical analysis.
The acquisition and digitisation of historical drilling data relating to
1,200 boreholes from Exxaro Resources Limited, aided in the upgrade of the
Makhado resource to over 1.3 billion tonnes of which over 230 million
tonnes are in
the `Measured` category. The upgraded models using the acquired data have
been submitted to independent mine planners who are in the process of
completing life-of-mine schedules.
Large diameter (123 mm) core drilling commenced to obtain coal samples for
detailed coking coal laboratory analysis as well as other coal parameter
testing. The initial results of this analysis yielded high quality coking
coal samples with a low phosphorous content. A further 5,000 metre smaller
diameter drilling programme is underway to define the coal outcrop zones
and identify any dolerite intrusions. Detailed analysis of the exploration
data was relating to the selection of mineable coal horizons within the 35
metre thick coal seam was completed and will be used to optimise the coal
horizon being mined leading to higher coking coal yields.
The Company agreed to acquire several New Order Prospecting Rights in the
proximity of the Makhado coal project. CoAL signed an agreement to purchase
of 60% of Tshikunda Mining (Pty) Ltd which holds the prospecting rights to
32,000 Ha contiguous to Exxaro Resources Ltd`s Tshikondeni coking coal
mine. Section 11 approval for the transfer of 60% of Tshikunda prospect to
CoAL was secured in June 2008. Furthermore, CoAL agreed to buy 74% of six
prospects located in the Makhado coal project area, from Sekoko Coal (Pty)
Ltd. The acquisition of the six prospects increases the Makhado project
area by over 7,000 Ha.
Initial marketing of the coking coal fraction will be finalised on
completion of a formal off-take agreement with ArcelorMittal who have
signed a Letter of Intent which includes an off-take of between 2.5 and 5
million tonnes "free on rail" Musina but paying "free on board" Kestrel
(east coast of Australia) coking coal prices. Other major consumers have
already expressed strong interest in securing a supply of hard coking coal
from the Makhado project and discussions in this respect are ongoing.
East Coast Maritime (Pty) Ltd were appointed to asses railway, road and
port infrastructure required for the Makhado and Vele projects. During the
year, two phases of the project were completed - the assessment if
infrastructure in place and, the development of understandings and
relationships with the various infrastructure stakeholders. A Rail
Cooperation Agreement was signed with Transnet Freight Rail (`TFR`) the
largest division of Transnet, the South African Government owned rail and
freight organisation. The agreement formalises the interaction between TRF
and CoAL whereby TFR will assist CoAL in securing the correct rail slots,
appropriate rolling stock as well as commercially competitive freight rates
for the transport of its export coal to the Richards Bay and Maputo ports.
CoAL has indicated that it will need rail capacity for the following export
tonnages:
* 2009 - 1 to 1.5 million tonnes
* 2010 - 4 to 5 million tonnes
* 2011 - 4 to 5 million tonnes
* 2012 - 10 million tonnes
Vele (previously Thuli) Coking Coal Project (74%)
Exploration on the Vele coal project west of Musina in the Limpopo province
included a 65 hole geological programme as well as a 31 large diameter
cored hole programme. CoAL acquired the original drilling data from the
exploration undertaken by Southern Sphere (Utah Mining) in the early 1980`s
and converted the data to digital format. The completed drilling programmes
together with the historical data, resulted in an upgrade of the previously
reported JORC/ SAMREC compliant `Indicated` resource. The 65 hole programme
covered approximately 80% of the project area and delivered a resource of
447.47 million gross in situ tonnes, of which 133.84 million tonnes occur
in the Measured status while 76.58 million tonnes are in the Indicated
status with the majority of coal being open-castable.
Holfontein Coal Project (100%)
An agreement has been concluded to sell the Holfontein coal project to
Lachlan Star Limited and as a result of the intended disposal, the
Holfontein investment has been reclassified as a Non-Current Investment
Held for Sale.
Nimag Group ("NiMag") (100%)
Nimag Group is engaged principally in the manufacture and distribution of
nickel magnesium alloys, ferro silicon magnesium alloys and metal fibres,
having begun producing alloys in 1962, and currently manufactures
specialised master alloys of nickel and magnesium for the specialised
foundry industry including aerospace, aeronautical, motor, steel mill roll
and associated industries.
Ductile iron (also called spheroidal graphite iron or nodular cast iron)
was discovered in the 1940s. The introduction of magnesium into the melt
results in nodular rather than flaky graphite in the resultant cast iron,
giving the cast iron properties approaching those of steel, while
maintaining the advantages of the casting process. The magnesium is
usually added as a nickel alloy, making it easier to add and contribute to
product quality. NiMag supplies the ductile iron market as a specialist
supplier with a world market share of about 35% in its core product line.
95% of sales are exported through 35 distributors world wide. Demand for
NiMag`s alloys is proportional with world demand for ductile iron,
principally for automotive parts and industrial machinery. Demand for
NiMag products has grown gradually to meet current capacity of 287 tonnes
per month (all products). Potential for expansion of the core nickel-
magnesium alloy product is presently limited by the size of end markets.
NiMag is increasing the penetration of a variety of other products
developed for alternative markets. NiMag produces approximately 300 tonnes
of cast and slit fibres which are used in reinforced concrete by domestic
mining and tunnelling operations.
NiMag`s competitive advantages include low electricity and labour costs.
The main input cost is locally sourced nickel raw material, which is
matched with sales to minimise nickel price exposure.
Depreciation of global nickel prices in the 2007/08 financial year reduced
NiMag`s margins resulting in the company generating lower operational cash
flows than those recorded in the previous year. NiMag traded profitably,
contributing approximately A$2.5m in surplus funds to the Group and at the
end of June 2008, CoAL`s acquisition loans comprised $187,629 to the NiMag
vendors.
Magberg Manufacturing
A specialised producer of ferro silicon magnesium alloys used to
manufacture Ductile Iron. Capacity is limited and the production is split
equally between local and export markets. This is a commodity product and
almost all costs are Rand denominated.
Metalloy Fibres (Pty) Ltd
The only specialised cast fibre reinforcing manufacturer in Africa. A
weakening of the Rand and the construction of the Gautrain rail project and
other large infrastructure projects in South Africa promises to
substantially improve this business both in terms of volumes and margins. A
new furnace has been constructed to ensure that manufacturing capacity is
on hand to satisfy the expected increase in demand.
Metal Alloy Traders Limited ("MATS")
MATS is incorporated in Jersey in the Channel Islands and it trades various
metals purchased from Nimag in South Africa.
Events Subsequent to Balance Date
Rio Tinto Joint Venture and Farm Swap
CoAL announced in early July that it has entered a Memorandum of
Understanding with Rio Tinto (`Chapudi Coal`) and its joint venture
partner, the Kwezi Group of South Africa, which the parties intend to
formalise into an agreement resulting in the transfer of Prospecting Rights
to each other or a separate joint venture initiative. The Prospects to be
transferred are coal interests in and around the Company`s Makhado hard
coking coal project in the Limpopo province. The Prospects to be
transferred to a new joint venture between Rio Tinto and CoAL will be
managed by Chapudi Coal. Transfer of the Prospects will add significant,
highly prospective acreage to the current Makhado project area improving
the economics of the project.
Makhado coking coal project Resource Upgrade
In July 2008, CoAL announced a resource upgrade to the Makhado coal project
from the previously reported 713mt to 1.335 billion gross in situ tones.
The resource upgrade is a result of further analysis of the borehole data
acquired from Exxaro Resources Limited as well as the drilling of boreholes
by CoAL. The 1.335 billion tonnes are situated on six farms representing
approximately 40% of the Makhado project area and can be summarized as
follows:
In Situ Rel Tonnes % Opencast Rel Tonnes %
Resource
Million Million
metric metric
tonnes tonnes
Measured 230.067 17.233% 208.364 37.847%
Indicated 548.642 41.095% 201.797 36.690%
Inferred 250.690 18.777% 25.445 4.613%
Reconnaissance 305.660 22.895% 114.771 20.853%
1,335,06 100.00% 550.377 100.00%
Vele semi-soft coking coal project Resource Upgrade
As a result of analysis of exploration data, the Company issued a Resource
upgrade for its Vele coal project increasing the resource from 441 gross in
situ tonnes to 721 total in situ tonnes which incorporates 641 gross in
situ tonnes. The table below details the upgrade:
Total In Gross In Situ In Situ Mineable
Situ
721 641 million tonnes 593 million tonnes - includes 158
million million tonnes Measured and 324
tonnes million tonnes Indicated
(Gross in situ (In situ Mineable incorporates
incorporates open potential geological losses)
castable coal)
Black Empowerment Transaction
Coal Investments Limited, a company forming part of the Company`s current
Black Empowerment Enterprise Investors increased its shareholding in the
Company to approximately 17.3% after receiving FIRB approval to increase
its stake beyond 15%. During August, CoAL issued the additional 12,000,000
shares at GBP1.30 per share raising an additional GBP15.6 million.
Port Allocation
Coal of Africa Limited secured long term export coal port allocation at the
Grindrod operated Richards Bay and Maputo dry bulk terminals. The export of
metallurgical coal mined at its Makhado and Vele projects is expected to
take place via the Maputo terminal and CoAL has secured the rights to up to
100% of the capacity resulting from expansion to the Maputo terminal
enabling CoAL to potentially export up to 7mtpa. The export of thermal coal
mined at the Company`s Mooiplaats project will be exported at the Richards
Bay terminals with an allocation of 900,000 tonnes commencing in 2009 which
could increase to 3 million tonnes per annum if port capacity is increased.
The Company will contribute capital on a pro rata basis to development at
both the Richards Bay and Maputo terminals.
Other than that stated above, there has not arisen 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 Consolidated Entity, the results of those operations, or
the state of affairs of the Consolidated Entity, in future financial years.
Review of Financial Position
Liquidity and funding
The net assets of the Consolidated Entity increased from $151 million in
June 2007 to over $490 million in June 2008. This was primarily due to cash
on hand at year end of $252 million (2007: $61.5 million) and the
acquisition of the Mooiplaats coal project. The Group incurred $4.1 million
in expenses related to share based payments and $10,503,875 in foreign
currency losses. Excluding the previously mentioned accounting entries
converts the loss of $11,243,563 recorded for the year ended June 2008 to
an `operational` loss of $1,159,640 (2007: `operational` profit of
$4,994,231). The reduction of the `operational` loss is primarily due to
interest earned of $5,787,101 and NiMag`s profit contribution of
$2,512,274.
2008 2007
$ $
Profit/ (loss) after tax for the year (11,243,563) (3,547,306)
Tax 919,603 2,216,264
Interest paid 146,174 800,799
Interest received (5,787,101) (555,353)
EBIT/ (LBIT) (15,964,887) (1,085,596)
`Non-ordinary` items recognised
Options granted 4,099,000 3,294,600
Diminution in value of investments - 1,666,792
Currency adjustment 10,503,875 629,033
Depreciation 202,372 175,532
JSE listing expenses - 313,870
`Operating` profit/ (loss) (1,159,640) 4,994,231
The Group raised over $331 million during the year through the placing of
shares. The funds raised were used to fund the Mooiplaats project
acquisition, the development of the Mooiplaats project and the exploration
and development of the Makhado and Vele projects.
Future Developments, Prospects and Business Strategies
Strategic direction
CoAL is primarily focused on the acquisition, exploration and development
of thermal and metallurgical coal projects in South Africa. The Company
currently has four coal projects in various stages of exploration as well
as Nimag, CoAL`s interim cash producing asset which manufactures nickel
magnesium alloys. Nimag`s growth strategy will be via the acquisition of
similar alloy or foundry supply manufacturing enterprises.
The exploration and development of three coal projects, namely Mooiplaats,
Makhado and Vele during the short and medium term will qualify CoAL as a
significant coal producer, supplying millions of tonnes of thermal and
metallurgical coal annually to South African and export customers.
Exploration on CoAL`s projects located in the Limpopo province - Makhado
and Vele - has yielded significant coal resources. Recent resource updates
have Makhado at 1.33 billion tonnes and Vele at 447.47 million
tonnes. Consultants have undertaken detailed feasibility studies on the
transport infrastructure from these coal projects to the Matola (Maputo)
and Richards Bay export coal terminals.
The Company`s Mooiplaats coal project is 2km from the recently re-
commissioned Camden Power Station - near Ermelo in Mpumalanga - and is
expected to start producing thermal and lean coal in late 2008.
Income Statements
For the Year Ended 30 June 2008
Consolidated Entity Parent Entity
2008 2007 2008 2007
$ $ $ $
REVENUE 53,774,119 62,595,362 6,030,020 1,105,766
Raw materials and (37,846,682) (48,078,842)
consumables used - -
Consulting expenses (1,216,068) (328,744) (720,823) (328,744)
Employee expenses (7,830,254) (6,410,948) (4,992,443) (4,026,233)
Borrowing costs (146,174) (800,799) - -
Depreciation (202,372) (175,532)
expenses (27,430) (12,923)
Office rental , (477,272) (425,164)
outgoings and
parking (112,104) (5,380)
Decrease/(increase) - (1,666,792)
diminution in value
of investments - (1,666,792)
Loss on investments
disposed of - (7,919) -
Bad debt expense - (306,066) - -
Provision for non-
recoverability of
loans/ debtors - (664,067) - (375,000)
Diminution in value
of control entities - (6,488) - (6,488)
Realised foreign (10,503,875) (629,033)
exchange
profit/(loss) (10,503,875) (629,033)
Other expenses from (5,875,381) (4,433,929)
ordinary activities (555,355) (533,861)
Share of net - -
profit/(losses) of
associate accounted
for using the
equity method - -
Profit/(Loss) (10,323,959) (1,331,042) (10,889,929)
before income tax (6,478,688)
(expense)/benefit
Income tax (919,604) (2,216,264)
(expense) / benefit - -
Profit/(Loss) after (11,243,563) (3,547,306) (10,889,929) (6,478,688)
tax
Outside equity
interest - (478,742) - -
Net profit/(loss) (11,243,563) (10,889,929) (6,478,688)
attributable to (4,026,048)
members of the
parent entity
Basic
earnings/(loss) per
share (in cents) (4.08) (4.72)
Headline
earnings/(loss) per
share (in cents) (4.12) (1.96)
Balance Sheets
As at June 2008
Consolidated Entity Parent Entity
2008 2007 2008 2007
$ $ $ $
REVENUE 53,774,119 62,595,362 6,030,020 1,105,766
Raw materials and (37,846,682) (48,078,842)
consumables used - -
Consulting (1,216,068) (328,744) (720,823) (328,744)
expenses
Employee expenses (7,830,254) (6,410,948) (4,992,443) (4,026,233)
Borrowing costs (146,174) (800,799) - -
Depreciation (202,372) (175,532)
expenses (27,430) (12,923)
Office rental , (477,272) (425,164)
outgoings and
parking (112,104) (5,380)
Decrease/(increas - (1,666,792)
e) diminution in
value of
investments - (1,666,792)
Loss on
investments
disposed of - (7,919) -
Bad debt expense - (306,066) - -
Provision for non-
recoverability of
loans/ debtors
- (664,067) - (375,000)
Diminution in
value of control
entities - (6,488) - (6,488)
Realised foreign (10,503,875) (629,033)
exchange
profit/(loss) (10,503,875) (629,033)
Other expenses (5,875,381) (4,433,929)
from ordinary
activities (555,355) (533,861)
Share of net - -
profit/(losses)
of associate
accounted for
using the equity
method - -
Profit/(Loss) (10,323,959) (1,331,042) (10,889,929)
before income tax (6,478,688)
(expense)/benefit
Income tax (919,604) (2,216,264)
(expense) /
benefit - -
Profit/(Loss) (11,243,563) (3,547,306) (10,889,929) (6,478,688)
after tax
Outside equity
interest - (478,742) - -
Net profit/(loss) (11,243,563) (10,889,929) (6,478,688)
attributable to (4,026,048)
members of the
parent entity
Basic
earnings/(loss)
per share (in
cents) (4.08) (4.72)
Headline
earnings/(loss)
per share (in
cents) (4.12) (1.96)
Cash Flow Statements
For the year ended 30 June 2008
Consolidated Entity Parent Entity
2008 2007 2008 2007
$ $ $ $
Cash flows from
operating
activities
Interest received 4,502,639 555,353 3,971,998 474,576
Cash receipts in
the course of
operations 49,252,248 59,382,997 - 241,337
Interest paid (146,174) (800,799) - -
Payments to
suppliers and
employees (56,618,474) (56,475,498) (2,212,535) (1,717,433)
Net cash generated (3,009,761) 2,662,053 1,759,461
by /(used in) (1,001,520)
operating
activities
Cash flows from
investing
activities
Payments for (1,951,879) (198,163) (9,260) (14,212)
property, plant
and equipment
Proceeds from the - 3,350 - -
sale of property,
plant and
equipment
Mineral assets -
acquired (85,341,442) (10,516,450) (85,341,442)
Proceeds from sale
of associate 501,634 - 501,634 -
Payments for
equity investments (9,427,131) - (2,836,444) (10,516,450)
Loans (made
to)/from other
entities - - - -
Net cash received/ - (75,000)
(paid) on
acquisition of
subsidiary - -
Exploration costs (18,491,719) (477,667) (3,752,291) -
Net cash generated (114,710,537) (11,263,930) (91,437,803)
by / (used in) (10,530,662)
investing
activities
Cash flows from
financing
activities
Loans from
controlled
entities - - - -
Proceeds from
issue of shares 331,294,448 78,334,038 331,294,448 78,334,038
Transaction costs
from issue of
shares (9,134,738) (2,778,509) (9,134,738) (2,778,509)
Loans to
controlled
entities - - (27,703,497) (10,563,335)
Loans repaid to
other entities (318,636) (4,647,628) - -
Other loans repaid (1,375,608) - - -
Loans from other
entities - 34,831 - -
Net cash generated 320,465,466 70,942,732 294,456,212 64,992,194
by financing
activities
Net increase/
(decrease) in cash
held 202,745,168 62,340,855 204,777,871 53,460,012
Effect of exchange
rates of cash
holdings in (12,270,799) (820,129) (6,339,304) (629,033)
foreign currencies
Cash at beginning
of financial year 61,530,490 49,764 52,909,170 78,191
Cash at end of 252,004,859 61,530,490 251,347,737 52,909,170
financial year
Notes to and forming part of the Financial Statements
for the year ended 30 June 2008
Consolidated Entity
2008 2007
$ $
1. (LOSS) / EARNINGS PER SHARE
Basic (loss) / profit per share
(cents per share) (4.08) (4.72)
Headline (loss)/earnings per share (cents per
share) (4.12) (1.96)
Weighted average number of ordinary shares 275,781,951 85,261,608
used as the denominator
As at 30 June 2008, there were 19,921,688 (2007: 21,842,326) options
outstanding over unissued capital exercisable at amounts ranging between
$0.50 and $2.05 (2007: $0.50 and $1.275). Diluted EPS was not calculated
for 2008 as the company incurred a loss per share.
Consolidated Entity
2008 2007
$ $
2. (LOSS) / EARNINGS PER SHARE
Basic (loss) / profit per share
(cents per share) (4.08) (4.72)
Headline (loss)/earnings per share (cents per
share) (4.12) (1.96)
Weighted average number of ordinary shares 275,781,951 85,261,608
used as the denominator
As at 30 June 2008, there were 19,921,688 (2007: 21,842,326) options
outstanding over unissued capital exercisable at amounts ranging between
$0.50 and $2.05 (2007: $0.50 and $1.275). Diluted EPS was not calculated
for 2008 as the company incurred a loss per share.
Consolidated Entity Parent Entity
2008 2007 2008 2007
$ $ $ $
3. AUDITORS`
REMUNERATION
Amounts received
or due and
receivable by the
auditors of the
Company:
Moore Stephens
- audit and review
of financial
reports
55,383 55,727 3,182 55,727
- other services
- - - -
55,383 55,727 3,182 55,727
Amounts received
or due and
receivable by the
auditors of the
subsidiaries
- audit and review
of financial
reports
47,505 70,451 - -
Consolidated Entity Parent Entity
2008 2007 2008 2007
$ $ $ $
- other services 434 9,225 - -
47,939 79,676 - -
4. RECEIVABLES
CURRENT
Receivable - - 620,311 - 620,312
associates
Provision for - (303,924) - (303,924)
doubtful
receivables -
associate
Trade debtors 3,339,890 4,524,156 - -
Other debtors 9,254,867 5,220,432 2,075,985 5,280,700
Provision for bad (843,160) (1,076,807) (787,740) (787,740)
debts
11,751,597 8,984,168 1,288,245 4,809,348
NON CURRENT
Amounts - - 53,751,025 12,696,233
receivable from
controlled
entities
Provision for - - (598,548) (598,548)
doubtful
receivables
- - 53,152,477 12,097,685
Amounts receivable from controlled entities are interest free, unsecured
and with no fixed term for repayment.
5. ASSETS HELD FOR SALE (INVESTMENT)
2008 - HOLFONTEIN INVESTMENTS (PTY) LTD
Carrying value of 24,328,181 681,528 23,529,228
investment at
beginning of year
Acquisition of
100% owned
subsidiary - 22,813,265 - -
Acquisition of
Wildebeesfontein
option 120,510 - 120,510 -
Capitalised
expenditure - at
cost 1,291,228 955,458 - -
Exchange
differences (531,922) (122,070) - -
Disposal of shares
during the year
- - - -
Share of
subsidiaries` net
(loss) / profit
- - - -
Carrying value at
end of year
25,207,997 24,328,181 23,649,738 -
The Company announced in May 2008 that it has reached an agreement to
dispose of its stake in Holfontein Investments (Pty) Ltd to Lachlan Star
Limited for $25 million. The acquisition consideration will be payable in
a combination of cash and shares staged at key milestones and on the
satisfaction of key milestones and conditions precedent. The acquirer
will reimburse CoAL for a proportion of the exploration expenditure
incurred. The sale milestones and conditions have not been met at 30 June
2008.
6. OTHER
FINANCIAL ASSETS
Available for Sale
Financial Assets:
Investments:
Shares in other
corporations
listed on
Stock exchange at 1,153,598 89,150 1,153,598 1,694,703
cost
Provision for (76,176) (76,175) (76,176) (1,488,502)
diminution in
value
At fair value 1,077,422 12,975 1,077,422 206,201
Shares in
controlled
entities at cost
- - 178,462,846 79,759,836
Provision for
diminution in
value - - (8,292,540) (8,292,540)
Impairment write
down - - - (1,666,792)
- - 170,170,306 69,800,504
Shares in other 7,022,423 12,915,623 1,771,997 12,935,729
corporations - at
cost
8,099,845 12,928,598 173,019,725 82,942,434
Market value of 1,613,228 12,975 1,613,228 206,201
above investments
listed on a stock
exchange as at 30
June 2008
Shares in controlled entities are carried at cost. Refer to Note 26(a)
Consolidated Entity
2008 2007
$ $
7. COAL PROJECT INVESTMENT AND EXPLORATION EXPENDITURE
Exploration and evaluation expenditures in respect of mining areas of
interest
Makhado (previously Baobab)
Prior acquisition of tenements of the
Makhado coal project - fair value 33,130,647 33,130,547
Current year acquisition of Makhado
tenements - fair value 1,340,096 -
Exchange differences (214,576) (384,750)
At fair value 34,256,167 32,745,797
Capitalised exploration expenditure - at
cost 5,174,833 84,196
39,431,000 32,829,993
Vele (previously Thuli)
Acquisition of tenements of the Vele coal
project - fair value 11,828,787 11,828,787
Exchange differences (76,039) (94,334)
At fair value 11,752,748 11,734,453
Capitalised exploration expenditure - at
cost 2,770,780 84,196
14,523,528 11,818,649
Holfontein
Acquisition of tenements of the Holfontein - 23,494,793
coal project - fair value
Exchange differences - (122,070)
At fair value - 23,372,723
Capitalised exploration expenditure - at
cost - 955,458
- 24,328,181
Mooiplaats
Acquisition of tenements of the Mooiplaats -
coal project - fair value 129,723,620
Exchange differences (800,218) -
At fair value 128,923,402 -
Consolidated Entity
2008 2007
$ $
Capitalised exploration expenditure - at
cost 10,258,218 -
139,181,620 -
Total Mining Assets 174,932,316 67,852,973
Total capitalised exploration expenditure 18,203,831 1,123,850
The ultimate recoupment of costs carried forward for exploration and
evaluation phases is dependant on the discovery of commercially viable
resource deposits and their successful development and commercial
exploitation
or sale of the respective mining areas. The Holfontein coal project is
disclosed as an asset available for sale as at 30 June 2008.
Consolidated Entity Parent Entity
2008 2007 2008 2007
$ $ $ $
8. PAYABLES
CURRENT
Trade creditors 5,118,470 7,098,669 282,865 123,282
Sundry creditors 28,865 186,605 26,081 95,574
and accruals
Other 1,032,471 2,034,087 - -
6,179,806 9,319,361 308,946 218,856
NON CURRENT
Payables - - 19,022,676 5,671,382
- controlled
entities
Payables - 1,375,608 - 1,375,608
- other
- 1,375,608 19,022,676 7,046,990
Amounts owing to controlled entities are interest free, unsecured and with
no fixed term for repayment.
Sponsor
PricewaterhouseCoopers Corporate Finance (Pty) Ltd
1 October 2008
Date: 01/10/2008 10:08:20 Produced by the JSE SENS Department.
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