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SIM
SIIF
SIM - Simmer and Jack Mines, Limited - Reviewed Report for six months and
quarter ended 30 September 2010(Q2 Fy2011)
Simmer and Jack Mines, Limited
(Incorporated in the Republic of South Africa)
(Registration number 1924/007778/06)
Share code: SIM
ISIN Code: ZAE000006722
("Simmer and Jack")
REVIEWED REPORT FOR SIX MONTHS AND QUARTER ENDED 30 SEPTEMBER 2010(Q2 FY2011)
Salient Features:
General safety improvement evident during the quarter ended 30 September 2010
Tau Lekoa accounted for two months of Q2 FY2011
Revenue increased by 106% to R327 million compared to the R158 million reported
for the previous quarter ended 30 June 2010
Cash operating profit of R7.9 million compared to a loss of R52.8 million
during the previous quarter
Gold production increased 108% to 36 608 oz (1 139 kg) from 17 599 oz (547 kg)
previously
Cash and cash equivalents of R140 million after settling the Tau Lekoa purchase
price (R598 million at 30 June 2010)
Fair value adjustment in relation to the Mine Waste Solutions Rand Notes of
R113 million
Mr Bernard Swanepoel appointed as Chairman
Operational Developments:
At Buffelsfontein Gold Mine ("BGM"):
Safety performance substantially improved, no fatalities during the quarter
under review and 488 030 fatality-free-shifts
Quarter-on-quarter gold production increased by 4% from 17 599 oz (547 kg) to
18 353 oz (571 kg)
Gold revenue increased from R158 million to R163 million
Total cash costs decreased quarter-on-quarter by 10% from R211 million (USD1,
587/oz) to R190 million (USD1,411/oz)
Cash operating loss of R27.5 million compared to a loss of R52.7 million in the
previous quarter
Unit cash costs of R333 709/kg (USD1 187/oz) compared to R385 801/kg (USD1
587/oz)
Capital expenditure of R20.9 million compared to R16.8 million in the last
quarter (excluding the acquisition of Tau Lekoa)
At Tau Lekoa Mine ("Tau Lekoa"):
Tau Lekoa mining rights transferred into a Simmer and Jack subsidiary
Initial R450 million paid to AngloGold Ashanti as settlement for the Tau Lekoa
acquisition - remainder of purchase price (R32 million) was settled on 1
November 2010
Cash operating profit for August and September of R35 million
Gold production increased by 28 kg`s quarter on quarter
Gold revenue increased slightly from R245 million to R249 million of which, BGM
only benefitted from gold revenue of R164 million for the period August to
September
Total cash costs well maintained, decreasing quarter-on-quarter by 1% from
R199 million (USD957/oz) to R197 million
Pre-feasibility study for Weltevreden project on track for completion during Q3
FY2011
Post Period-End:
Fatal injury occurred at the Tau Lekoa mine on 3 October 2010 following an
accident that occurred during tramming operations
The Operating Cash Flow ("OCF") shortfall of R17.6 million, in relation to the
Tau Lekoa acquisition, was settled by way of an issue of 30 612 245 Simmer and
Jack shares, in line with shareholder approval
R13.4 million in respect of the revenue royalty payable to AngloGold Ashanti
for the period 1 January to 30 June 2010 settled
Forward Gold Purchase loan ("Gold Loan") to the value of USD20 million
concluded with Deutsche Bank AG. Loan proceeds used to settle the remainder of
the amount due to Rand Merchant Bank under the bridge loan of R105 million
Statement by
STATEMENT BY INTERIM CHIEF EXECUTIVE OFFICER
It was with deep regret that Ms Moleko was fatally injured, while she was
engaged in tramming operations underground at the Tau Lekoa gold mine on 3
October 2010. The Company extends heartfelt condolences to the family and
friends of Ms Moleko. The Department of Mineral Resources ("DMR") halted
operations only in the affected area and the Section 54 notice was lifted within
three days, when normal production resumed. Simmer and Jack has intensified its
focus on minimising the impact of safety related stoppages through safety
programs at all its operations.
The success of these interventions is evident in the safety statistics for Q2
and the improved relationship with the DMR.
The improvement in safety is particularly evident at BGM where the focus on
safety and increased investment in safety related expenditure resulted in BGM
exceeding 500 000 fatality free shifts post quarter end. Tau Lekoa achieved 12
consecutive accident free days and a total of 29 accident free days for the
month. The Company continues to drive the objective of no harm to all employees,
through heightened communication and specific awareness campaigns launched to
ensure safe and sustainable working conditions.
Simmer and Jack recently announced that a Gold Loan to the value of USD20
million was concluded with Deutsche Bank AG. The Gold Loan will be amortised
through physical gold delivery to Deutsche Bank by Simmer and Jack over a twelve
month period. The loan proceed was used to settle the R105 million that was due
to Rand Merchant Bank, under the restructured bridge loan that was entered into
in July 2010. This is a significant step forward in restructuring the Simmer and
Jack balance sheet, as debt is now more closely aligned with the cash flow
expected from the operations.
The highlight of the quarter was the successful conclusion of the acquisition of
Tau Lekoa from AngloGold Ashanti in July 2010 and ore treatment at BGM`s south
plant commencing on 1 August 2010. As a result, revenue increased by 106% to
R327 million - this despite a slightly lower gold price compared to the previous
quarter. The focus on quality mining at BGM resulted in notable improvement in
the underground recovered grade achieved towards the end of Q2, with grade
of3.88 g/t recovered during September 2010, compared to 2.97 g/t during July
2010. This ensures that BGM remains on track to achieve its targeted 4 g/t. The
cash operating profit of R7.9 million, compared to a loss of R52.8 million
during the previous quarter, is indicative of the Company`s turnaround plan and
provides affirmation that the Company remains confident that the annual
production target of 150 000 oz (4 665 kg) of gold by the end of March 2011, and
R150 million of free cash to be generated from Tau Lekoa by July 2011, will be
achieved.
The quarter-on-quarter increase in absolute total costs is as a direct result of
Tau Lekoa, for the first time, being consolidated with BGM into Simmer and Jack.
Tau Lekoa`s total cash cost decline of 2% is encouraging, while BGM is starting
to show signs of contributing positively to free cash flow generation as the
focus on profitable production and the control of operating costs are finding
its way into the numbers. Efforts to extract real synergy benefits between Tau
Lekoa and BGM are ongoing and head office and administrative costs at Simmer and
Jack have been materially reduced.
It was announced during the last quarter that the Company will dispose of
Transvaal Gold Mining Estates Limited ("TGME") to Stonewall Mining for R25
million. Both parties are working towards fulfilling the remaining conditions
precedent by 28 February 2011. While this disposal reduces the current care and
maintenance costs, successful conclusion of the transaction will further
strengthen the Company`s cash position. More importantly it allows absolute
management focus on Simmer and Jack`s operations and the ongoing exploitation of
synergies between Tau Lekoa and BGM.
Nico Schoeman
Interim Chief Executive Officer
Group selected financial information
Table one
SELECTED FINANCIAL INFORMATION
Q2 Q1 Va- YTD YTD
riance
Q2
FY2011 FY2011 vs. Q1 FY2011 FY2010
R`000 R`000 % R`000 R`000
Statement of
Comprehensive
Income
Continuing
operations
Revenue 326 889 158 431 106% 485 320 455 040
Total cash
cost(1) (319 006) (211 181) (51%) (530 187) (476 602)
Total cash
operating
profit/(loss) 7 883 (52 750) 115% (44 866) (21 562)
Production-
related
depreciation (20 445) (5 797) (253%) (26 242) (13 543)
Rehabilitation
expenses (154) (179) 14% (333) (409)
Operating loss
from mining
activities (12 715) (58 726) 78% (71 441) (35 514)
Non-production
related
depreciation (1 802) (1 630) (11%) (3 432) (2 843)
Other income 3 588 4 218 (15%) 7 806 11 058
Share options
costs (1 125) (3 901) 71% (5 026) (16 306)
General
administrative
and overhead
expenditure (32 795) (31 694) (3%) (64 488) (50 535)
Loss from
operations
before
interest and
taxation (44 849) (91 731) 51% (136 580) (94 140)
Fair value
adjustments(2) (113 439) 60 (188 (113 379) 964
930%)
Impairments (2 165) - (100%) (2 165) -
Loss from
equity-
accounted
investment (114 016) (127 629) 11% (241 645) (45 530)
Restructuring
costs (6 627) - (100%) (6 627) -
Loss on sale
of
investment(2) (25 500) - (100%) (25 500) -
Net finance
income/
(charges) 863 (7 926) 111% (7 063) 47 910
Loss before
taxation from
continuing
operations (305 734) (227 226) (35%) (532 960) (90 796)
Loss from
discontinuing
operations (1 939) (3 840) 50% (5 779) (33 162)
Loss before
taxation (307 673) (231 066) (33%) (538 739) (123 958)
Statement of Financial Position
Total assets 3 638 217 3 776 108 (4%) 3 638 217 4 200 741
Cash and
equivalents* 140 295 598 127 (77%) 140 295 787 423
Investments in
and loans to
associates 1 673 636 1 767 (5%) 1 673 636 2 245 833
857
Current
liabilities (552 822) (465 049) (19%) (552 822) (375 181)
Non-current
liabilities (535 022) (456 540) (17%) (535 022) (214 587)
Total equity (2 550 373) (2 854 519) (11%) (2 550 373) (3 610 974)
Notes to Table one:
(1)Total cash costs are costs directly related to the physical activities of
producing gold and include mining costs, administrative costs, royalties, on
mine drilling expenditures that are related to production and other direct
costs. Sales of by-product metals are deducted from the above in computing cash
costs. Cash costs exclude depreciation, depletion and amortisation, corporate
general and administrative expenses, exploration costs, finance charges, and pre
feasibility costs and accruals for mine reclamation but include central costs
such as human resources and technical services.
(2)During the quarter 85 000 Mine Waste Solutions Rand Notes were disposed at a
loss of R25.5 million compared to the face value of the notes. The disposal was
necessitated in order to enable the company to meet its repayment obligations
under the RMB Bridge Loan Facility. The Mine Waste Rand Notes have also been
classified as a financial asset at fair value and subsequent to the
abovementioned sale, necessitated a downward fair value adjustment through the
Statement of Comprehensive Income of R113.3 million.
*Cash and cash equivalents includes the R95.9 million which is restricted cash
held as guarantees for rehabilitation at Tau Lekoa (R94.2 million) and at TGME
(R1.7 million) and reflect the payment to AGA of R450 million in cash.
**The results for Tau Lekoa in respect of Q2 FY2011 is only incorporated into
the consolidated results of the Group for two months since 1 August 2010.
***The TGME non-current asset (or disposal group) is classified as held-for-sale
in line with IFRS 5 due to the fact that the carrying value of TGME will not be
recovered through continuing use but rather through a sale transaction. Simmer
and Jack announced this transaction on 9 September 2010 in terms whereof it has
entered into an agreement to dispose of its wholly owned subsidiary TGME to
Stonewall Mining (Proprietary) Limited ("Stonewall"), for R25 million and that
the sale is subject to a number of conditions which conditions must be fulfilled
by no later than 28 February 2011. IFRS 5 necessitated the reclassification of
comparative information.
Summary of group salient features
Table two
SIMMER AND JACK QUARTER YTD
Q2 Q1
DETAIL Unit FY2011 FY2011 FY2011 FY2010
Gold Produced kg 1 139 547 1 686 2 062
oz 36 608 17 599 54 207 66 295
Tonnes Milled - Total mt 657 613 1 271 1 114
Tonnes Milled - UG mt 323 107 429 460
Tonnes Milled - Surface mt 334 507 841 654
Revenue R/kg 287 088 289 434 287 850 241 767
Total Cash Costs R/kg 280 802 385 801 314 891 263 134
Notional Cash Expenditure R/kg 313 086 416 829 346 767 307 338
Total Cash Costs - Total R/t 486 344 418 480
Total Cash Costs - UG R/t 909 1 533 1 064 935
Total Cash Costs - Surface R/t 78 84 82 63
Cash Operating Loss R`000 7 883 (52 750) (44 866) (21 562)
*The indicators in table 2 exclude the TGME results which have been reclassified
as a discontinuing operation. Notional cash cost also excludes Tau asset
purchase.
Table 3 - Simmer and Jack`s quarterly and six monthly FY2011 and FY2010 group
variance analysis
REVENUE VARIANCE
Price Revenue
Period Kg R/kg R`000
Q2 FY2011 1 139 287 088 326 889
Q1 FY2010 547 289 434 158 431
TOTAL 591 (2 345) 168 458
Volume Variance Price Revenue
R`000 Variance Variance
Period R`000 R`000
Q1 vs. Q2 169 742 (1 284) 168 458
Price Revenue
Period Kg R/kg R`000
FY2011 YTD 1 686 287 850 485 320
FY2010 YTD 2 062 241 657 498 528
TOTAL (376) 46 081 (13 208)
Volume Price Revenue
Variance Variance Variance
Period R`000 R`000 R`000
FY2010 vs.
FY2011 (108 226) 95 018 (13 208)
TOTAL CASH COST VARIANCE
Total
Cost Cash Cost Variance
Period Kg R/kg R`000 R`000
Q2 FY2011 1 139 275 868 314 113 12 776
Q1 FY2010 547 385 801 211 181 (52 750)
TOTAL 591 (109 933) 102 932 65 526
Volume Variance Unit Cost Cost Total
R`000 Variance Variance Variance
Period R`000 R`000 R`000
Q1 vs. Q2 163 108 (60 176) 102 932 65 526
Total
Cost Cash Cost Variance
Period Kg R/kg R`000 R`000
FY2011 YTD 1 686 311 559 525 294 (39 974)
FY2010 YTD 2 062 263 136 542 586 (44 058)
TOTAL (376) 48 423 (17 292) 4 084
Volume Variance Unit Cost Cost Total
R`000 Variance Variance Variance
Period R`000 R`000 R`000
FY2010 vs. FY2011
(117 140) 99 848 (17 292) 4 084
*Total cash costs are costs directly related to the physical activities of
producing gold and include mining costs, administrative costs; royalties, on-
mine drilling expenditures that are related to production and other direct
costs. Sales of by-product metals are deducted from the above in computing cash
costs. Cash costs exclude depreciation, depletion and amortisation, corporate
general and administrative expense, exploration costs, interest costs, and pre-
feasibility costs and accruals for mine reclamation but include central costs
such as human resources, technical services etc.
**The indicators in table 3 exclude the TGME results which have been
reclassified as a discontinuing operation.
Q2 FY2011 v Q1 FY2011
Safety
At the start of the third quarter, Tau Lekoa suffered an unfortunate fatality
tarnishing the previous quarter`s good safety efforts. The incident took place
on 3 October and related to a tramming accident wherein Ms Moleko was,
regrettably, fatally injured. Remedial actions have been implemented to ensure
that the occurrence of a similar incident is minimised.
Production
Simmer and Jack consolidated
With effect from 1 August 2010, the Tau Lekoa production and financial results
have been consolidated, together with the BGM results into Simmer and Jack. The
numbers disclosed therefore show the effect of the ownership of Tau Lekoa for
only two months over this reporting period.
Simmer and Jack`s total gold production increased by 108% from 17 599 oz (547
kg) in the last quarter to 36 608 oz (1 139 kg) for this quarter ending 30
September 2010. During Q2, 51 036 square metres were broken, resulting in
underground tonnage delivered to the plant of 322 896 tonnes. The overall
underground recovered grade decreased from 3.44 g/t in Q1 to 3.21 g/t in Q2,
mainly as a result of the initial gold lock-up that occurred as a result of
treating Tau Lekoa ore at the BGM plant. This lock-up has now stabilised.
Gold revenue increased from R158 million to R327 million, mainly as a result of
the increase in total production volume - 19 009 oz or 591.3 kg additional gold
was produced compared to the last quarter). This led to a positive impact of
R167.2 million, whilst the slightly lower Rand gold price reduced revenue by
R1.3 million.
Total cash costs increased quarter-on-quarter by 51 % from R211 million to R320
million (USD1,169/oz), essentially from the increased production costs being
introduced as a direct result of Tau Lekoa being consolidated into Simmer and
Jack during Q2.
On a consolidated basis, Simmer and Jack had a satisfactory operating quarter,
generating a cash operating profit of R7.9 million, compared to a loss of R52.7
million during the last quarter ended 30 June 2010.
BGM
BGM`s gold production increased by 4% from 17 599 oz (547 kg) in Q1 FY2011, to
18 353 oz (571 kg) in Q2 FY2011. Last quarter`s available face length was
similar to that achieved in this quarter, but face advance increased
considerable, by 53%, from the last to the current quarter. This resulted in a
10 850 (square meter)(52%) increase in square metres broken, which in turn
impacted on the underground tonnage that increased by 28%, quarter-on-quarter.
The underground grade decreased slightly from 3.44 g/t in Q1 FY2011 to 3.43 g/t
in Q2 FY2011. The increase in underground tonnage positively impacted the
overall plant recovery grade.
Gold revenue increased from R158 million to R163 million, an increase of R4.5
million. An amount of R6.7 million is directly as a result of the increased
production volumes, but this was offset by a slightly lower Rand gold price per
kilogram.
Total cash costs decreased quarter-on-quarter by 10% from R211 million to R190
million. Costs decreased by R20.7 million, mainly as a result of less surface
material being processed through the plant. This is due to the Tau Lekoa
material being processed through the same plant. In addition, shared synergy
costs with Tau Lekoa and enhanced efficiencies also contributed to the declining
costs. As a result of the good control and increased production volume, BGM was
able to reduce its cash operating loss by R25.3 million, from R52.7 million in
Q1 to R27.5 million in Q2.
Tau Lekoa operations
From 1 August 2010, all Tau Lekoa ore is treated at the BGM plant facilities.
Integration issues have mostly been dealt with and operationally the mine
performed well during the quarter.
Gold production, on a full quarter-on-quarter basis, was 28 kg (900 oz) higher
during the second quarter. Of the total quarterly production of 848kg (27 263
oz), BGM only accounted for 568 kg (18 261 oz). Face length increased by 774 m -
ledging and face advance improved by 0.5 m, overall yields decreased slightly
from 3.4 g/t to 3.3 g/t.
Gold revenue increased from R245 million to R249 million for the quarter, which
is due to higher production volumes (893 oz or 27.8 kg, R8.1 million positive
contribution), offset by a slightly lower Rand per kilogram gold price,
amounting to R3.9 million, of this, BGM only benefitted from gold revenue of
R164 million for the period August to September, with a total cash cost of R129
million (USD977/oz), resulting in a cash operating profit of R35 million, for
the two months.
Total cash costs decreased quarter-on-quarter by 1% from R199 million
(USD976/oz) to R197 million (USD962/oz). Costs reduced by R1.9 million largely
as a result of lower services costs.
Tau Lekoa`s cash operating profit increased by 5% to R52.1 million from R49.6
million reported in the last quarter.
Capital Expenditure
Simmer and Jack`s capital expenditure increased from R8.6 million in Q1, FY2011
to R540.3 million in Q2 FY2011. This includes R501.7 million for the Tau Lekoa
purchase and post acquisition capital expenditure, R1.2 million for the opening-
up of new mining areas; R1.2 million was spent in the plant and R2.3 million of
the expenditure was safety related.
Corporate Activity
Final settlement relating to the acquisition of Tau Lekoa
Following the fulfilment of the last conditions precedent to the agreement in
respect to the acquisition of Tau Lekoa from AngloGold Ashanti, an independent
expert was engaged to review the accuracy and reasonableness of the Operating
Cash Flow Account ("OCF"). Subsequent to the outcome of the review report, a
shortfall of R17.6 million was agreed to and in addition to the revenue
royalties for the period of 1 January to 30 June 2010 which amounted to R13.4
million, and other costs, resulted in a final settlement to AngloGold Ashanti of
R32 million. The agreement catered for a settlement offset of the revenue
royalty against the OCF balance. This was settled on 1 November 2010 by means of
a share issuance of 30 612 245 Simmer and Jack shares valued at R30 million, in
line with shareholder approval and the balance which was settled in cash.
Gold loan with Deutsche Bank
The Company has concluded a Forward Gold Purchase Agreement with Deutsche Bank
A.G. whereby Deutsche Bank will purchase 24 360 oz of gold from BGM. Deutsche
Bank will in terms of the agreement deposit USD20 million (less fees) to the
Company which will be repaid over a tenure of 12 months by means of the delivery
of 2 030 oz of gold per month, subject to performance and other conditions.
OUTLOOK AND GROWTH PROSPECTS
Outlook Q3 FY 2011
In Q3 FY2011, BGM expects to produce some 21 000 oz (653 kg) of gold at cash
costs of approximately USD1,128/oz, at a Rand equivalent of R250 000/Kg.
In Q3 FY2011, Tau Lekoa expects to produce some 30 000oz (933 kg) of gold at
cash costs of approximately USD1,007/oz, at a Rand equivalent of R215 000/Kg.
The Company is starting to realise the benefits on Tau Lekoa`s integration with
BGM by means of cutting out certain corporate overheads that were previously
factored into the cost profile for Tau Lekoa and by treating Tau Lekoa ore at
BGM. The integration enables the Company to spread the operating costs over a
much larger volume and share the service costs that were previously incorporated
into one operation. This integration and the benefits derived will continue to
be monitored in the coming quarters in order to ensure that the benefits
intended, are fully maximized.
Similar to the abovementioned benefits that are being realised through the
synergies in place between BGM and Tau Lekoa, it is foreseen that the operations
will benefit from a lower cost base in Q3 onwards as a consequence of recent
restructuring exercises undertaken throughout the Group.
Growth Prospects at BGM
A number of growth opportunities exist at BGM.
North West Block -
Good progress towards accessing the North West Block was made during the
quarter. Access to the area, which has an indicated reserve of 570 000 square
meters, estimated to contain 14 000 kg of gold, involves the repair of Number 6
shaft between 69 and 71 level, which is on schedule. The Number 1 man-winder has
been re-commissioned, which will assist in accessing 71 level station sooner
than expected due to both man-winders being available for shaft repairs. Shaft
steel work repairs are expected to be completed by October 2010. The first
stoping work is anticipated to take place in the latter part of Q4 FY2011.
The following projects identified at BGM remain subject to Board approval and
the availability of funding.
Installation of a third `C` mill to treat surface sources The Company continues
to assess the viability of installing a third 65 000 t/m mill at BGM`s South
plant to provide extra milling capacity to continue treating the mine`s
lucrative surface rock dump material.
The installation of a third mill provides the mine with much needed flexibility
and capacity in treating all available ore resources.
With the installation of the third mill, the plant can recover an additional 38
kg of gold economically, whilst further reducing operating cost at both BGM and
Tau Lekoa. The total capital estimate for this third mill is R49 million.
CIL Circuit
BGM is also investigating the option of installing an additional four stage
Carbon in Leach (CIL) circuit in the existing South plant. By installing a four
stage CIL circuit, gold recovery could increase by approximately 4.5%,
potentially recovering an extra 10 kg of gold per month. The total capital
estimate for this CIL circuit is R23 million.
Growth prospects at Tau Lekoa
At Tau Lekoa a surface borehole is planned for November 2010 in the far west
area, where a prospective mining area was identified. An area contiguous to the
current Tau Lekoa workings also exist in the Pamodzi/Aurora mine area. Tau Lekoa
will examine opportunities to access these from existing infrastructure. The
identified opportunities could potentially extend the life of mine of Tau Lekoa
if viable.
Mineral reserves and resources
A material change in the mineral reserve and resource assets is foreseen with
the conclusion of the acquisition of Tau Lekoa and Weltevreden. An assessment of
these assets is underway and an updated consolidated position will be included
in the FY2011 annual report.
INVESTOR CONFERENCE CALL:
A conference call to discuss the results for the first quarter hosted by the
interim chief executive officer and the chief financial officer will be
conducted at 15:00 SA time on Monday 22 November 2010.
Dial in details:
Johannesburg (Telkom): 011 535 3600
South Africa Toll-free: 0 800 200 648
UK Toll-free: 0 800 917 7042
Australia Toll-free: 1 800 350 100
Canada Toll-free: 1 866 605 3852
USA Toll-free: 1 800 860 2442
Other: +27 11 535 3600
Replay numbers: playback code 2544#
Johannesburg: 011 305 2030
UK Toll-free: 0 808 234 6771
AU Toll-free: 1 800 091 250
USA: 1 412 317 0088
Other: +27 11 305 2030
Forward-looking Information
This shareholders report and financial statements for the quarter ended 30
September 2010 contain certain forward-looking statements. Forward-looking
statements include but are not limited to those with respect to the price of
uranium and gold, the estimation of mineral resources and reserves, the
realization of mineral reserve estimates, the timing and amount of estimated
future production, costs of production, capital expenditures, costs and timing
of development of new deposits, success of exploration activities, permitting
time lines, currency fluctuations, requirements for additional capital,
government regulation of mining operations, environmental risks, unanticipated
reclamation expenses, title disputes or claims and limitations on insurance
coverage and the timing and possible outcome of pending litigation. In certain
cases, forward-looking statements can be identified by the use of words such as
"plans", "expects" or "does not expect", "is expected", "budget", "scheduled",
"estimates", "forecasts", "intends", "anticipates", or "does not anticipate", or
"believes" or variations of such words and phrases, or state that certain
actions, events or results "may", "could", "would", "might" or "will" be taken,
occur or be achieved. Forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause the actual results,
performance or achievements of Simmer and Jack to be materially different from
any future results, performance or achievement expressed or implied by the
forward-looking statements. Such risks and uncertainties include, among others,
the actual results of current exploration activities, conclusions of economic
evaluations, changes in project parameters as plans continue to be refined,
possible variations in grade and ore densities or recovery rates, failure of
plant, equipment or processes to operate as anticipated, accidents, labour
disputes or other risks of the mining industry, delays in obtaining government
approvals or financing or in completion of development or construction
activities, risks relating to the integration of acquisitions, to international
operations, to prices of uranium and gold. Although Simmer and Jack has
attempted to identify important factors that could cause actual actions, events
or results to differ materially from those described in forward-looking
statements, there may be other factors that cause actions, events or results not
to be as anticipated, estimated or intended. It is important to note, that: (i)
unless otherwise indicated, forward-looking statements indicate the Group`s`
expectations as at 22 November 2010; (ii) actual results may differ materially
from the Group`s expectations if known and unknown risks or uncertainties affect
its business, or if estimates or assumptions prove inaccurate; (iii) the Group
cannot guarantee that any forward-looking statement will materialize and,
accordingly, readers are cautioned not to place undue reliance on these forward-
looking statements; and (iv) the Group disclaims any intention and assumes no
obligation to update or revise any forward-looking statement even if new
information becomes available, as a result of future events or for any other
reason.
Trading statements
The shareholders are advised that as a result of Simmer and Jack`s policy of
publishing its results on a quarterly basis, it will be exempt from the
provisions of sections 3.4 (b)(i) to (viii) of the JSE Listing Requirement
relating to the issuance of trading statements. Prospects of expected
performance will be included in the quarterly reports instead.
For further information, please contact:
Julian Gwillim APRIO
E-mail julian@aprio.co.za
SPONSOR
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
BGM
Opera-
ting
Results
Total Central Surface Underground
BGM Tau
Total Division Lekoa
Ore Q2
milled/ F2011 657 - 334 323 136 187
treated
(000
tonnes)
Q1
F2011 613 - 507 107 107 -
YTD
FY2011 1 271 - 841 429 243 187
FY
2010 2 504 22 1 719 764 764 -
Yield Q2
(grams F2011 1,73 - 0,31 3,21 3,43 3,04
per
ton)
Q1
F2011 0,89 4,58 0,36 3,43 3,43 -
YTD
FY2011 1,33 4,58 0,34 3,26 3,43 3,04
FY
2010 1,37 2,84 0,36 3,61 3,61 -
Gold Q2
(kilo- F2011 1 138,64 - 102,66 1 035,98 468,19 567,79
grams)
Q1
F2011 547,38 0,49 180,78 366,11 366,11 -
YTD
FY2011 1 686,02 0,49 283,44 1 402,09 834,30 567,79
FY
2010 3 436,60 61,49 621,68 2 753,43 2 753,43 -
Gold Q2
(oz) F2011 36 608 - 3 300 33 308 15 053 18 255
Q1
F2011 17 599 16 5 812 11 771 11 771 -
YTD
FY2011 54 207 16 9 113 45 078 26 823 18 255
FY
2010 110 489 1 977 19 987 88 525 88 525 -
Revenue Q2
(Rand F2011 287 088 - 284 084 287 386 285 812 288 683
per
kilo-
gram de-
clared)
Q1
F2011 289 434 274 635 291 125 288 618 288 618 -
YTD
FY2011 287 850 274 635 288 575 287 708 287 044 288 683
FY
2010 252 400 239 707 256 586 251 738 251 738 -
Revenue Q2
(USD/oz F2011 1 214 - 1 201 1 215 1 208 1 220
de-
clared)
Q1
F2011 1 191 1 130 1 198 1 187 1 187 -
YTD
FY2011 1 213 1 157 1 216 1 212 1 209 1 216
FY
2010 1 000 950 1 017 998 998 -
Total Q2
cash F2011 280 802 - 254 373 283 421 351 104 227 609
costs
(Rand
per
kilo-
gram de-
clared)
Q1
F2011 385 801 - 236 606 446 290 446 290 -
YTD
FY2011 314 891 - 243 041 325 948 392 874 227 609
FY
2010 264 410 - 150 622 283 179 283 179 -
Total Q2
cash F2011 1 187 - 1 075 1 198 1 484 962
costs
(USD/oz
de-
clared)
Q1
F2011 1 587 - 973 1 836 1 836 -
YTD
FY2011 1 327 - 1 024 1 373 1 655 959
FY
2010 1 048 - 597 1 122 1 122 -
Total
cash
costs
(R/t Q2
ore) F2011 486 - 78 909 1 206 693
Q1
F2011 344 - 84 1 533 1 533 -
YTD
FY2011 418 - 82 1 064 1 349 693
FY
2010 363 - 54 1 021 1 021 -
Capital Q2
Expen- F2011 474 990 - 13 677 491 697 13 640 885 891
diture
(Rand
Per
kilo-
gram de-
clared)
Q1
F2011 30 781 - 1 517 17 808 17 808 -
YTD
FY2011
330 773 - 5 921 367 957 15 469 885 891
FY -
2010 34 627 - 19 260 17 313 17 313
Notio- Q2
nal F2011 756 291 - 268 050 775 118 364 744 1 113
Cash 500
Cost
(Rand
per
kilo-
gram
De-
clared)
Q1
F2011 416 829 - 238 123 464 098 464 098 -
YTD
FY2011 646 081 - 248 962 693 905 408 343 1 113
500
FY
2010 299 348 - 169 882 300 492 300 492 -
Finan- (Rand
cial `000) BGM
Results
Total Central Underground
BGM Tau
Surface Total Division Lekoa
Revenue Q2
F2011 326 889 - 29 163 297 727 133 814 163 913
Q1
F2011 158 431 136 52 630 105 666 105 666 -
YTD
FY2011 485 320 136 81 792 403 392 239 480 163 913
FY
2010 867 395 14 741 159 513 693 142 693 142 -
Total Q2
cash F2011 319 731 - 26 113 293 619 164 383 129 235
costs
Q1
F2011 211 181 5 017 42 774 163 390 163 390 -
YTD
FY2011 530 912 5 017 68 887 457 009 327 773 129 235
FY
2010 908 671 35 320 93 638 779 713 779 713 -
Opera- Q2
Ting F2011 (32 371) (11 1 984 (22 843) (40 753) 17 911
Profit 512)
Q1
F2011 (88 273) (34 607) 9 487 (63 153) (63 153) -
YTD
FY2011 (120 (46 119) 11 470 (85 996) (103 17 911
644) 906)
FY
2010 (85 995) (54 371) 62 974 (94 598) (94 598) -
Capital Q2
expen- F2011 540 842 30 048 1 404 509 389 6 386 503 003
diture
(Rand
`000)
Q1
F2011 16 849 10 055 274 6 520 6 520 -
YTD
FY2011 557 691 40 103 1 678 515 909 12 906 503 003
FY
2010 119 001 59 357 11 973 47 670 47 670 -
Cash Q2
Flow F2011 (546 (35 652) 1 502 (511 933) (41 642) (470
(After 083) 290)
Capex)
Q1
F2011 (74 204) (19 541) 9 582 (64 244) (64 244) -
YTD
FY2011 (620 (55 193) 11 084 (576 177) (105 (470
286) 886) 290)
FY
2010 (180 97 533) 53 731 (136 833) (136 -
634) 833)
REVIEWED ABRIDGED CONSOLIDATED INTERIM RESULTS OF SIMMER AND JACK MINES, LIMITED
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2010
STATEMENT OF FINANCIAL POSITION
as at 30 September 2010
Reviewed Reviewed Audited
six months six months twelve
as at as at months
30 30 as at
September September 31 March
Figures in Rand thousand Notes 2010 2009 2010
ASSETS
Non-current assets
Investment property 33 400 34 004 37 376
Property, plant and equipment 2 1 157 894 783 942 583 803
Investment in associate 4 1 672 375 2 078 801 2 001 030
Financial assets 3 287 080 14 186 21 852
Environmental rehabilitation
trust fund 123 095 145 058 123 424
3 273 844 3 055 991 2 767 485
Current assets
Loans to group companies and
associate 5 1 260 167 032 110 594
Current tax receivable 13 - 18
Inventories 26 701 33 582 26 565
Trade and other receivables 87 838 73 365 71 436
Reimbursive asset 71 227 81 842 71 227
Cash and cash equivalents 6 140 294 787 423 632 798
327 333 1 143 244 912 638
Assets of disposal groups
classified as held-for-sale 7 37 036 1 489 4 903
Total Assets 3 638 213 4 200 724 3 685 026
EQUITY AND LIABILITIES
Equity
Equity attributable to owners
of the parent
Share capital and premium 1 232 926 1 231 117 1 231 913
Reserves 392 048 303 181 420 185
Retained income 925 397 2 076 676 1 464 136
Equity attributable to owners
of the parent 2 550 371 3 610 974 3 116 234
Non-controlling interest 1 1 1
2 550 372 3 610 975 3 116 235
Liabilities
Non-current liabilities
Finance lease obligation - 6 033 4 024
Environmental rehabilitation
provision 272 519 205 748 219 316
Financial liabilities 8 233 423 219 135 210 044
505 942 430 916 433 384
Current liabilities
Finance lease obligation - 2 806 2 933
Financial liabilities 8 271 828 13 775 13 657
Current tax payable - 36 -
Trade and other payables 280 991 142 216 118 817
552 819 158 833 135 407
Liabilities of disposal
groups classified as held-for-
sale 7 29 080 - -
581 899 158 833 135 407
Total liabilities 1 087 841 589 749 568 791
Total Equity and Liabilities 3 638 213 4 200 724 3 685 026
STATEMENT OF COMPREHENSIVE INCOME
for the period ended 30 September 2010
Figures in Notes Unaudited Unaudited Reviewed Reviewed Audited
Rand three three six six twelve
thousand months months months months months
ended 30 ended 30 ended 30 ended 30 ended 31
September September September September March
2010 2009 2010 2009 2010
Continuing
operations
Revenue 326 889 229 434 485 320 455 041 867 395
Cost of
production (339 605) (255 481) (556 761) (490 556) (923 255)
Gross
(loss)/
profit (12 716) (26 047) (71 441) (35 515) (55 860)
Other income 4 697 1 410 11 410 11 058 37 063
General
administra-
tive and
overhead
expenditure (35 706) (28 282) (71 524) (53 140) (170 542)
Share option
costs (1 125) (8 274) (5 026) (16 307) (28 111)
Operating
loss (44 850) (61 193) (136 581) (93 904) (217 450)
Finance
income 13 270 35 061 33 642 84 589 133 292
Loss from
equity-
accounted
investment (114 016) (97 563) (241 645) (45 530) (291 770)
Partial
disposal of
financial
asset 9 (25 500) - (25 500) - -
Restructu-
ring costs (6 627) (57) (6 628) - (3 650)
Net movement
in fair
value (113 439) 388 (113 379) 964 9 740
Impairment
of assets 10 (2 165) - (2 165) - (13 450)
Loss gain on
non-current
assets held
for sale - - - (236) (230)
Finance
charges (12 407) (6 002) (40 704) (36 679) (34 940)
Loss before
taxation (305 734) (129 366) (532 960) (90 796) (418 458)
Taxation - - - - -
Loss for the
period from
continuing
operations (305 734) (129 366) (532 960) (90 796) (418 458)
Loss for the
period from
discon-
tinuing
operations (1 939) (17 478) (5 779) (33 162) (317 905)
Loss for the
period (307 673) (146 844) (538 739) (123 958) (736 363)
Other
comprehensiv
e income
Share of
other com-
prehensive
income of
equity-
accounted
investment 13 500 - (25 808) - 89 765
Movement in
available-
for-sale
financial
instruments - - 7 658
Other com-
prehensive
income/
(loss) for
the period,
net of
taxation 13 500 - (25 808) - 97 423
Total com-
prehensive
loss for the
period (294 173) (146 844) (564 547) (123 958) (638 940)
Total com-
prehensive
loss
attributable
to:
Owners of
the parent (294 173) (146 844) (564 547) (123 958) (638 940)
Non-
controlling
interest - - - - -
(294 173) (146 844) (564 547) (123 958) (638 940)
Earnings per
share from
continuing
operations
Basic
(loss)/
earnings per
share
(cents) (25 03) (11 03) (43 64) (7 74) (34 95)
Diluted
(loss)/
earnings
per share
(cents) (25 03) (11 03) (43 64) (7 83) (34 95)
Earnings per
share from
discon-
tinuing
operations
Basic
(loss)/
earnings
per share
(cents) (0 16) (1 49) (0 47) (2 83) (26 55)
Diluted
(loss)/
earnings
per share
(cents) (0 16) (1 49) (0 47) (2 86) (26 55)
Earnings per
share
Basic
(loss)/
earnings
per share
(cents) 11 (25 19) (12 52) (44 11) (10 57) (61 51)
Diluted
(loss)/
earnings
per share
(cents) 11 (25 19) (12 52) (44 11) (10 70) (61 51)
STATEMENT OF CHANGES IN EQUITY
for the period ended 30 September 2010
Attributable to owners of the parent
Avail- Total
able- Accumu- attribu-
Share for- lated table to
Figures Share based sale (loss)/ owners of
in Rand capi- Share payment valua- Other Retained the
thousand tal premium reserve tion reserves income parent
Balance
at
1 April
2009 21 757 930 090 264 782 4 080 - 2 200 499 3 421 208
Total
changes
for the
year 2 199 277 867 53 900 7 658 89 765 (736 363) (304 974)
Balance
at
1 April
2010 23 956 1 207 957 318 682 11 738 89 765 1 464 136 3 116 234
Total
changes
for the
year 52 961 (2 329) - (25 808) (538 739) (565 863)
Balance
at 30
Septembe
r 2010 23 956 1 208 970 316 353 11 738 63 957 925 397 2 550 371
STATEMENT OF CHANGES IN EQUITY (continued)
for the period ended 30 September 2010
Figures in Rand Non-control- Total equity
thousand ling interest
Balance at
1 April 2009
1 3 421 209
Total changes
for the year
- (304 974)
Balance at
1 April 2010
1 3 116 235
Total changes
for the year
- (565 863)
Balance
at 30 September
2010
1 2 550 372
STATEMENT OF CASH FLOWS
for the period ended 30 September 2010
Reviewed Reviewed Audited
six months six months twelve
as at 30 as at 30 months as
September September at 31 March
Figures in Rand thousand Note 2010 2009 2010
Net cash from operating
activities 78 271 (81 731) (131 567)
Cash flows from investing
activities (856 465) (87 387) (341 881)
Cash flows from financing
activities 285 690 113 863 263 568
Net decrease in cash and cash
equivalents (492 504) (55 255) (209 880)
Cash and cash equivalents at
the beginning of the period 632 798 842 678 842 678
Total cash and cash
equivalents at end of the
period 6 140 294 787 423 632 798
NOTES TO THE REVIEWED ABRIDGED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
for the period ended 30 September 2010
1 Significant accounting policies
1.1 General information
Simmer and Jack Mines, Limited (`the Company`) and its subsidiaries (together
`the Group`) are engaged in exploration, extraction and processing of gold. The
group has mining operations in the North West and Free State Provinces in South
Africa.
1.2 Presentation of Financial Statements
The financial statements have been prepared in compliance with International
Financial Reporting Standards (IFRS) and the Companies Act of South Africa and
in accordance with International Accounting Standard (IAS 34): Interim Financial
Reporting. The financial statements have been prepared on the historical cost
basis, unless otherwise stated.
These accounting policies are consistent with the previous annual financial
statements except for exploration expenditure as indicated below.
The financial information has been reviewed by Grant Thornton whose unqualified
report is available for inspection at the Group`s registered office.
1.3 Change in accounting policy
During the period the Group changed its policy regarding exploration
expenditure. Expenditure on exploration is capitalised until the viability of
the mining venture has been proven. If the mining venture is subsequently
considered non-viable the expenditure is charged against income as and when that
fact becomes known.
This change in accounting policy does not affect prior period information
presented.
2 Property, plant and equipment
Reviewed six months as at
30 September 2010
Cost Accumulated Carrying
depreciation value
and
impairment
R`000 R`000 R`000
Land and buildings 13 169 (2 205) 10 964
Plant and equipment 118 762 (21 717) 97 045
Furniture and fixtures 29 003 (10 577) 18 426
Motor vehicles 1 476 (515) 961
Mining assets 1 150 714 (125 859) 1 024 855
Computer equipment and
software 10 611 (7 794) 2 817
Development and
infrastructure - - -
Mining rights 212 (212) -
Exploration costs 2 826 - 2 826
Total 1 326 773 (168 879) 1 157 894
Certain of the assets for the period have been reclassified.
2 Property, plant and equipment (continued)
Reviewed six months as at
30 September 2009
Cost Accumulated Carrying
depreciation value
and
impairment
R`000 R`000 R`000
Land and buildings 8 192 (1 784) 6 408
Plant and equipment 191 290 (35 381) 155 909
Furniture and fixtures 20 597 (7 033) 13 564
Motor vehicles 1 813 (541) 1 272
Mining assets 25 781 (8 358) 17 423
Computer equipment and
software 11 281 (6 404) 4 877
Development and
infrastructure 629 461 (128 415) 501 046
Mining rights 5 743 (1 672) 4 071
Exploration costs 79 372 - 79 372
Total 973 530 (189 588) 783 942
2 Property, plant and equipment (continued)
Audited twelve months as at
31 March 2010
Cost Accumulated Carrying
depreciation value
and
impairment
R`000 R`000 R`000
Land and buildings 8 553 (2 142) 6 411
Plant and equipment 286 391 (189 795) 96 596
Furniture and fixtures 25 583 (8 905) 16 678
Motor vehicles 1 589 (605) 984
Mining assets 574 894 (115 943) 458 951
Computer equipment and
software 12 058 (9 312) 2 746
Development and
infrastructure 134 866 (134 866) -
Mining rights 6 485 (6 485) -
Exploration costs 71 832 (70 395) 1 437
Total 1 122 251 (538 448) 583 803
Certain of the assets for the period have been reclassified.
3 Financial assets
Reviewed Reviewed Audited
six months six months twelve
as at 30 as at 30 months as
September September at 31 March
2010 2009 2010
Available for sale
Unlisted shares - Rand Mutual
Assurance Company 115 shares -
Directors` valuation 9 9 9
Unlisted shares - Rand Refinery
Limited 24 004 shares - Directors`
valuation 21 843 14 177 21 843
At fair value through profit or
loss
MWS Rand Notes 378 897 - -
Fair value adjustment (113 669) - -
During April 2010, First Uranium
Corporation (FIU) concluded its
convertible redeemable note
financing (the Offering) in terms
of the First Uranium
Recapitalisation Programme. In
connection with the Offering,
Simmer and Jack Mines, Limited
(Simmers) exchanged its R160
million loan plus accrued and
unpaid interest for an equivalent
value of MWS Rand Notes. Each MWS
Rand Note has a principal amount of
R1 000 and will be convertible into
107.36 Common FIU Shares, also
representing a conversion price of
USD1.30.
The Company has furthermore used
the rand equivalent of CAD10
million from Simmers` cash reserves
to subscribe for MWS Rand Notes. In
addition, Rand Merchant Bank has
provided the Company with a Bridge
Loan Facility of R220 million
(approximately CAD30 million) which
Simmers used to subscribe for MWS
Rand Notes.
During the year 85 000 notes were
sold at a loss of R25.5 million.
287 080 14 186 21 852
4 Investment in associate
Percentage Percentage
holding 30 holding 30 Percentage
Name of September September holding 31
company Held by 2010 2009 March 2010
Associate
First Uranium Simmer and
Corporation Jack
Mines,
Limited Jan-00 34.35% 37.24% 37.24%
4 Investment in associate (continued)
Carrying Carrying
amount 30 amount 30 Carrying amount 31 March 2010
Name of company September September
2010 2009
R`000 R`000
Associate
First Uranium
Corporation 1 672 375 2 078 801 2 001 030
1 672 375 2 078 801 2 001 030
As at 30 September the market value of the investment was R358 million
based on the listed share price. Management is of the opinion that this
does not reflect the value of the investment.
Impairment testing
In assessing whether the investment in First Uranium Corporation has
been impaired, the carrying value is compared with its recoverable
amount.
For the purpose of impairment testing, the recoverable amount has been
determined based on value in use (VIU) calculations.
5 Loans to associate
Reviewed Reviewed Audited
six months six months twelve
as at 30 as at 30 months as
September September at 31 March
2010 2009 2010
R`000 R`000 R`000
First Uranium Corporation 1 260 4 358 -
The loan is unsecured bears interest at
prime and has no fixed terms of
repayment.
First Uranium Corporation - 162,674 110,594
The loan is unsecured, bears interest at
JIBAR + 7% with interest quarterly in
arrears. The loan was converted to MWS
Rand Notes.
1 260 167 032 110 594
6 Cash and cash equivalents
Reviewed Reviewed Audited
six months six months twelve
as at 30 as at 30 months as
September September at 31 March
2010 2009 2010
Cash and cash equivalents consist of: R`000 R`000 R`000
Cash on hand 27 18 82
Bank balances 140 267 787 405 632 716
140 294 787 423 632 798
R96 million of the cash and cash equivalents held by the Group at period end
is not available for general use by the Group as it has been committed to
fund rehabilitation commitments.
7 Disposal groups classified as held-for-sale and discontinued operations
Reviewed Reviewed Audited
six months six months twelve
as at 30 as at 30 months as
September September at 31
2010 2009 March 2010
R`000 R`000 R`000
On 9 September 2010 Simmers agreed to
sell its wholly owned subsidiary,
Transvaal Gold Mining Estates Ltd
(TGME) to Stonewall Mining
(Proprietary) Limited (Stonewall) for
R25 million. The sale is subject to a
number of conditions, which must be
fulfilled by no later than 28 February
2011.
In terms of the agreement, Stonewall
has assumed all care and maintenance
costs as from 1 September 2010.
Investment property held for sale
consist of residential houses and
property in Stilfontein, which is part
of the BGM reporting segment.
The assets and liabilities classified
as held-for-sale are as follows
Investment property 4 200 1 489 4 903
Assets of disposal groups 32 836 - -
37 036 1 489 4 903
Liabilities of disposal groups 29 080 - -
8 Financial liabilities
Reviewed Reviewed Audited
six months six months twelve
as at 30 as at 30 months as
September September at 31
2010 2009 March 2010
R`000 R`000 R`000
DMTN Programme 155 957 - -
The establishment of a Domestic Medium
Term Note Programme (Programme) was
approved by the JSE Limited. In terms
of this Programme, the Company may
from time to time issue notes (Notes)
denominated in South African Rand, up
to an aggregate nominal amount of R250
million.
RMB Bridge Loan 105 500 - -
"Rand Merchant Bank has provided
Simmers with a Bridge Loan Facility
which Simmers used to subscribe for
MWS Rand Notes. The Bridge Loan
Facility bears interest at 1 month
JIBAR plus 4% and is guaranteed by
Simmers` material subsidiaries.
Simmers and its material subsidiaries
have provided security in favour of a
security special purpose vehicle
("Security SPV"). The Security SPV has
guaranteed Simmers` obligations under
the Bridge Loan Facility to Rand
Merchant Bank. The security provided
to the Security SPV consists of shares
in and claims against FIU and its
subsidiaries, shares in Buffelsfontein
Gold Mine (Proprietary) Limited and
cession of bank accounts. General and
special notarial bonds were registered
in favour of the Security SPV over all
moveable assets not already encumbered
and mortgage bonds were registered
over mining rights.
Aberdeen International Incorporated
(Aberdeen) 243 794 232 910 223 701
505 251 232 910 223 701
Non-current portion 233 423 219 135 210 044
Current portion 271 828 13 775 13 657
505 251 232 910 223 701
9 Partial disposal of financial asset
Unaudited Unaudited Reviewed Reviewed Audited
three three six six twelve
months months months months months
ended 30 ended 30 ended 30 ended 30 ended 31
September September September September March
2010 2009 2010 2009 2010
Loss from sale of
notes (25 500) - (25 500) - -
Simmers disposed of
85 000 MWS Rand Notes
during the quarter.
10 Impairment of assets
Material impairment
losses recognised
Property, plant and
equipment - - - - (68)
Loans to Margaret
Water Company (2 165) - (2 165) - (13 382)
(2 165) - (2 165) - (13 450)
11 Headline loss
Unaudited Unaudited Reviewed Reviewed Audited
three three six six twelve
months months months months months
ended 30 ended 30 ended 30 ended 30 ended 31
September September September September March
2010 2009 2010 2009 2010
Reconciliation
between
earnings/(loss) and
headline loss:
Net loss from
continuing operations (305 734) (129 366) (532 960) (90 796) (418 458)
Net loss from
discontinuing
operations (1 939) (17 478) (5 779) (33 162) (317 905)
Basic (loss)/earnings
for the year (307 673) (146 844) (538 739) (123 958) (736 363)
Impairment of
property, plant and
equipment - - - - 253 667
Disposal of property,
plant and equipment -
(gain)/loss - - (1) - (10)
(Loss)/gain on sale
of non-current assets
held for sale - 100 - - 230
Translation
differences - - - (41 258) -
Fair value
adjustments - (388) - (482) (8 201)
Fair value adjustment
on held-for-sale
assets - - - - 960
Non-controlling
interest - - - 15 364 -
Headline loss for the
year (307 673) (147 132) (538 740) (150 334) (489 717)
Basic (loss)/profit
per share (cents)
from continuing
operations* (25,03) (11,03) (43,64) (7,74) (34,95)
Basic (loss)/profit
per share (cents)
from discontinuing
operations* (0,16) (1,49) (0,47) (2,83) (26,55)
Total basic
(loss)/profit per
share (cents)* (25,19) (12,52) (44,11) (10,57) (61,51)
Diluted (loss)/profit
per share (cents)
from continuing
operations* (25,03) (11,03) (43,64) (7,83) (34,95)
Diluted (loss)/profit
per share (cents)
from discontinuing
operations* (0,16) (1,49) (0,47) (2,86) (26,55)
Total diluted
(loss)/profit per (25,19) (12,52) (44,11) (10,70) (61,51)
share (cents)*
Headline loss per
share (cents)* (25,19) (12,52) (44,11) (12,81) (40,90)
Diluted headline loss
per share (cents)* (25,19) (12,54) (44,11) (12,97) (40,90)
Net asset value per
share (cents) 208,82 295,66 208,82 295,66 255,15
*Based on weighted average number of shares in issue
Reconciliation of
number of shares
issued `000 `000 `000 `000 `000
Reported at 1 April 1 221 318 1 221 318 1 221 318 1 111 368 1 111 368
Shares issued for
cash - - - 109 950 109 950
Shares issued at
period 1 221 318 1 221 318 1 221 318 1 221 318 1 221 318
Weighted average
number of ordinary
shares in issue 1 221 318 1 173 252 1 1 173 252 1 197 219
221 318
Adjusted for:
- Share options - - - (14 259) -
Weighted average
number of ordinary
shares for diluted
earnings per share 1 221 318 1 173 252 1 221 318 1 158 993 1 197 219
Basic earnings per share is calculated by dividing the profit attributable
to equity holders of the Company by the weighted average number of
ordinary shares in issue during the year.
12 Events after reporting period
Deutche Bank AG Gold Loan
The Group concluded a USD20 million Gold Loan with Deutche Bank AG. The
Gold Loan will be amortised through physical gold delivery to Deutche Bank
AG over a twelve month period. The loan was used to settle the R105.5
million that was due to Rand Merchant Bank Limited.
Changes to Board
Resignations Date
GJ Jacobs 10 May 2010
KPE Wakeford 26 April 2010
P Surgey 26 April 2010
V Khanyile 10 September 2010
Appointments
V Watson 28 April 2010
PM Saaiman 1 July 2010
N Magau 17 July 2010
13 Segment information
Six months ended
30 September 2010
Corporate
and
Figures in Rand thousand BGM TAU exploration Total
Revenue 321 408 163 912 - 485 320
Loss for the period from
continuing operations (135 347) 17 910 (415 523) (532 960)
Total assets 969 391 577 993 2 090 829 3 638 213
"The Department of Mineral Resources has transferred the Mining Rights for
the Tau Lekoa Mine from AngloGold Ashanti Ltd (AngloGold) to
Buffelsfontein Gold Mines Limited (BGM), a wholly-owned subsidiary of
Simmers. With the registration of the transfer of the mining rights, being
the final condition precedent in terms of the sale and purchase agreement
between Simmers and AngloGold, full ownership of Tau Lekoa and the
adjacent properties of Weltevreden and Goedgenoeg has pass to Simmers from
1 August 2010. As Tau Lekoa is managed by a separate management team its
performance is presented separately.
TGME classified as held-for-sale following the decision to sell, is no
longer reflected in segmental reporting.
Date: 22/11/2010 07:05:03 Produced by the JSE SENS Department.
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