| Wed 18 Aug 2010, 9:00 | | DMC - DiamondCorp Plc - Interim Results (unaudited) for the period ended 30 June |
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DMC
DMC
DMC - DiamondCorp Plc - Interim Results (unaudited) for the period ended 30 June
2010
DiamondCorp plc
JSE share code: DMC
AIM share code: DCP
ISIN: GB00B183ZC46
(Incorporated in England and Wales)
(Registration number 05400982)
(SA company registration number 2007/031444/10)
(`DiamondCorp` or `the Company` or `the Group`)
Interim Results (unaudited) for the period ended 30 June 2010
DiamondCorp plc, a southern Africa focussed diamond mine development and
exploration company, releases its interim results for the period ended 30 June
2010. The results are unaudited.
HIGHLIGHTS
* GBP7.1 million of new equity capital was raised during the period, allowing
development at the Lace mine in South Africa and exploration in Botswana to
resume.
* Net loss for the six months ended 30 June 2010 was GBP1,609,114 (30 June
2009: GBP974,476).
* The loss was determined after charging administrative overhead costs of
GBP653,983 (2009 - GBP740,339) and interest charges of GBP201,537 (2009 -
GBP208,040). Non-cash charges for the period included depreciation and
amortisation and were GBP611,461 (2009 - GBP472,630) and a foreign exchange
loss on the long term loan of GBP168,960 (2009 - GBP426,595 gain).
* The consolidated cash balance at the date prior to this announcement was
GBP4,126,953 and current receivables were GBP143,262.
Commenting on the results, DiamondCorp CEO Paul Loudon said: `It was gratifying
that after one of the toughest years on record experienced in the diamond
industry, our shareholders, old and new, provided us with the development
capital required to access the considerable diamond resource at Lace which
exists below the -240m level.
`After closing on GBP7.1 million of new equity financing in April, the Company
has concentrated on development of a new decline access to kimberlite below the
-240m level. The 4.5m x 4.5m decline is progressing within budget and is
currently on schedule to access the -240m level by the end of 2010, slightly
ahead of the original timetable.
`The decline is budgeted to cost GBP4 million and will be used for hauling
kimberlite from below the -240m level for bulk testing purposes and
implementation of the sub-level caving mining plan devised by Snowden Mining
Industry Consultants.
`Assuming a positive bulk testing grade and necessary development capital is
raised, the 6m x 2m vertical shaft is planned to be re-equipped during 2011 for
primary ore hoisting which will provide capacity for production from Lace to
increase to 1.2 million tonnes per annum. The decline will then be used for men,
materials and ventilation for the remainder of the +25-year life of the mine.
`We have also commenced drilling on our exciting kimberlite prospects south of
Debswana`s massive Jwaneng mine in Botswana.
`The first four drill holes to a maximum of 200m vertical depth on J-05, a 2 to
4 hectare geophysical target, have all intersected kimberlite.
`Detailed core logging and preparation of samples for microdiamond analysis
on J-05 are underway while the drilling rig is being relocated to J-12, a very
large 45 hectare geophysical target. Both the J-05 and J-12 kimberlite targets
are less than 10km from Debswana`s Jwaneng mine, the richest diamond mine in the
world by revenue per tonne.
`We look forward to reporting in detail the results of this exploration
programme in the months ahead.`
18 August 2010
London
The Competent Person responsible for the technical information with respect to
Botswana contained in this announcement is Mr Paul Zweistra (Pr. Sci. Nat.,
Registration number 400016/93) a full-time employee of VP3 Geoservices (Pty)
Limited. VP3 and Mr Zweistra have given their permission for their work to be
quoted in this announcement.
AIM Nomad: Cenkos Securities plc
AIM Brokers: Cenkos Securities plc, Fairfax I.S. plc
JSE Sponsor: PSG Capital (Pty) Limited
DiamondCorp plc, Paul Loudon +44 20 3151 0970
Liz Bowman/Ivonne Cantu, Cenkos Securities plc +44 20 7397 8900
Ewan Leggat, Fairfax I.S. plc +44 207 598 5368
John-Paul Dicks, PSG Capital (Pty) Limited +27 21 887 9602
Charmane Russell/Marion Brower, Russell & Associates +27 11 880 3924
CONSOLIDATED INCOME STATEMENT
Six months ended 30 June 2010
Six months Six months
ended ended
30 June 30 June
2010 2009
GBP GBP
Revenue - 67,238
Cost of sales - (67,238)
GROSS PROFIT - -
Administrative expenses (653,983) (740,339)
Depreciation and amortisation (611,461) (472,630)
expense
OPERATING LOSS (1,265,444) (1,212,969)
Investment revenues - interest 26,827 19,938
on bank deposits
Interest expense (201,537) (208,040)
Foreign exchange (loss)/gain (168,960) 426,595
on long term loan
LOSS BEFORE TAX (1,609,114) (974,476)
Tax - -
LOSS FOR THE FINANCIAL PERIOD (1,609,114) (974,476)
ATTRIBUTABLE TO THE EQUITY (1,609,114) (974,476)
HOLDERS OF THE PARENT
BASIC & DILUTED LOSS PER SHARE GBP0.028 GBP0.024
HEADLINE LOSS PER SHARE GBP0.029 GBP0.024
All of the activities of the Group are classed as continuing.
STATEMENT OF CHANGES IN EQUITY
Six months Six months
ended ended
30 June 30 June
2010 2009
GBP GBP
Opening balance 10,442,525 12,734,691
Loss for the financial period (1,609,114) (974,476)
New equity share capital 3,040,426 -
subscribed
Premium on new equity share 3,516,236 -
capital subscribed
Translation reserve 285,489 532,029
Value attributed to warrants granted (49,160) -
Value of share option reserve - 33,347
Closing balance 15,626,402 12,325,591
CONSOLIDATED BALANCE SHEET
30 June 31 December
2010 2009
GBP GBP
NON-CURRENT ASSETS
Goodwill 4,606,026 4,606,026
Other intangible assets 3,007,666 2,523,303
Property, plant and equipment 6,011,451 6,412,997
13,625,143 13,542,326
CURRENT ASSETS
Inventories 312,536 303,020
Other receivables 143,262 190,703
Cash and cash equivalents 4,766,087 288,188
5,221,885 781,911
TOTAL ASSETS 18,847,028 14,324,237
CURRENT LIABILITIES
Obligations under finance leases (49,397) (73,345)
Other payables (308,160) (691,829)
Current portion of long term loan (1,666,667) (941,738)
Provisions (12,113) (11,791)
(2,036,337) (1,718,703)
NON-CURRENT LIABILITIES
Long term loan (1,184,289) (2,163,009)
NET ASSETS 15,626,402 10,442,525
EQUITY
Share capital 4,457,386 1,416,960
Share premium 21,388,816 17,872,580
Warrant reserve 505,876 555,036
Share option reserve 371,675 371,675
Translation reserve 1,780,806 1,495,317
Retained losses (12,878,157) (11,269,043)
EQUITY ATTRIBUTABLE TO EQUITY 15,626,402 10,442,525
HOLDERS OF THE PARENT
CONSOLIDATED CASH FLOW STATEMENT
Six months Six months
ended ended
30 June 30 June
2010 2009
GBP GBP
Net loss for the period (1,635,941) (994,414)
Depreciation and amortisation 611,461 472,630
Foreign exchange loss/(gain) 168,960 (426,595)
on long term loan
Gain on disposal of property, (43,555) -
plant and equipment
Other non-cash charges 51,056 182,347
Decrease in receivables 47,441 285,597
(Increase)/(Decrease in inventories (9,516) 79,331
(Decrease)/Increase in other payables (329,124) 202,287
NET CASH USED IN OPERATING (1,139,218) (198,817)
ACTIVITIES
INVESTING ACTIVITIES
Purchase of intangible assets (368,837) (1,451,642)
Disposal of property, plant and 152,358 -
equipment
Purchase of property, plant and (24,218) (1,146,423)
equipment
Interest received 26,827 19,938
NET CASH USED IN INVESTING (213,870) (2,578,127)
ACTIVITIES
FINANCING ACTIVITIES
Proceeds on issue of ordinary 6,542,847 -
shares
Repayment of capital on long (423,333) -
term loan
Interest payment on long term (201,537) -
loan
NET CASH FROM FINANCING ACTIVITIES 5,917,977 -
NET INCREASE(DECREASE) IN CASH 4,564,889 (2,776,944)
AND CASH EQUIVALENTS
CASH AND CASH EQUIVALENTS AT 288,188 3,252,276
BEGINNING OF PERIOD
Effect of foreign exchange (86,990) 11,203
rate changes
CASH AND CASH EQUIVALENTS AT 4,766,087 486,535
END OF PERIOD
NOTES TO THE FINANCIAL STATEMENTS
Six months ended 30 June 2010
1. ACCOUNTING POLICIES
These interim financial statements have been prepared using accounting policies
consistent with International Financial Reporting Standards (IFRSs). The same
accounting policies, presentation and methods of computation are followed in the
condensed interim financial information as applied in the Group`s latest annual
audited financial statements. While the financial figures included in this half-
yearly report have been computed in accordance with IFRSs applicable to interim
periods, this half-yearly report does not contain sufficient information to
constitute an interim financial report as that term is defined in IAS 34.
These interim financial statements were approved by the Board on 18 August 2010
and do not constitute statutory financial statements within the meaning of
Section 435 of the Companies Act 2006. A copy of the statutory accounts for the
year ended 31 December 2009 has been delivered to the Registrar of Companies.
The auditors` report on those accounts was not qualified and did not contain
statements under Section 498 (2) or (3) of the Companies Act 2006.
These interim financial statements have been prepared using the accounting
policies set out in the Group`s 2009 statutory accounts.
Results for the six-month period ended 30 June 2010 have not been audited.
The comparative information presented in the income statement has been prepared
based on the period 1 January 2009 - 30 June 2009. This has been performed in
order to comply with the AIM rules and is presented solely for this purpose.
2. LOSS PER SHARE
IAS required presentation of diluted earnings per share when a company could be
called upon to issue shares that would decrease net profit or increase net loss
per share. For a loss-making company with outstanding share options, net loss
per share would only be decreased by the exercise of out-of-money options. Since
it seems inappropriate to assume that option holders would exercise out-of-money
options, no adjustment has been made to basic loss per share for out-of-money
share options.
The calculation of basic and diluted loss per ordinary share is based on the
loss of GBP1,609,114 for the six months ended 30 June 2010 (30 June 2009:
GBP974,476) and on 57,955,303 ordinary shares (30 June 2009: 41,086,995) being
the weighted-average number of ordinary shares in issue.
3. SHARE CAPITAL
30 June 31 December
2010 2009
GBP GBP
Authorised share capital
166,666,666 ordinary shares
of 3 pence each 5,000,000 5,000,000
Called up, allotted and fully paid
No. GBP No. GBP
Ordinary shares
of 3 pence each 148,579,533 4,457,386 47,231,995 1,416,960
In January 2010, 285,000 ordinary shares were issued at 10 pence per share to
Cenkos Securities plc in consideration for commission and corporate advisory
fees with respect to the placing of 6,000,000 shares in November 2009.
In April 2010, the Company placed 101,062,538 ordinary shares at 7 pence each
for gross proceeds of GBP7.1 million.
4. GOING CONCERN
In determining the appropriate basis of presentation of the interim financial
statements, the Directors are required to consider whether the Group can
continue in operational existence for the foreseeable future, this being a
period of not less than 12 months from the date of the approval of the financial
statements. During the next 12 months the Group will be in a mine-development
phase and forecasts indicate that the Group may have insufficient financial
resources to accomplish all its development goals and meet all its financial
obligations over the next 12 months. The raising of additional finance is deemed
to be a material uncertainty which casts significant doubt over the ability of
the Group to continue as a going concern.
If its financial resources were insufficient, then the Group would be required
to (i) supplement its current cash resources by accessing the equity markets in
2010-2011 or by sale of assets or, alternatively, (ii) to modify its development
plan to preserve cash.
After making enquiries, given the successful GBP7.1 million fundraising in 2010
which was well-supported by the existing shareholder base, assuming that the
Group adheres to its development plan, the Directors have a reasonable
expectation that additional funds will be available within the next 12 months.
Accordingly the Directors continue to adopt the going concern basis of
presentation of the financial statements.
The financial statements therefore do not include the adjustments that would
result if the Group were not able to continue as a going concern.
Date: 18/08/2010 09:00:01 Produced by the JSE SENS Department.
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