Falcon Investment Holdings Societe Anonyme
(Incorporated in Luxembourg - R.C. Number B39773)
Registered Office
6 rue Adolphe Fischer,
L-1520, Luxembourg 13th February 2001
ANNOUNCEMENT
The attention of shareholders is drawn to the following statement made by the
chairman of the company's subsidiary, Falcon Gold Zimbabwe Limited, at that
company's Annual General Meeting, held in Zimbabwe today:
"FALCON GOLD ZIMBABWE LIMITED
CHAIRMAN'S ADDITIONAL REMARKS
In the published Annual Review for the year ended 30 September 2000, I reported
that the company had barely survived the most difficult economic conditions
experienced since Independence. Hyperinflation, shortages of foreign currency,
irregular fuels supplies, power cuts, weak international gold price and
unrealistic foreign exchange rates, were the main reasons for the company's
poor performance.
Performance for the first quarter of the current financial year to 31 December
2000 was encouraging and gold production averaged over 100 kgs per month,
compared with an average of 90 kgs for the prior 12 months. This increase in
production and more importantly, the concession granted by the Reserve Bank of
Zimbabwe, that 20% of gold sales can now be paid to the company in foreign
currency, has allowed the company to meet the increase in working costs for the
quarter. The balance of 80% of gold revenue is paid to the company at the
official Zimbabwean dollar rate of exchange. Gold mining is being
discriminated against and should be treated like all other exporters, who
receive all their foreign earnings.
However, should costs continue to increase at these unacceptable rates and the
Zimbabwe dollar exchange rate remains constant, working costs will soon
overtake gold income and cessation of mining activities and closure of all
mines in inevitable.
D.C. MARSHALL
CHAIRMAN"
In the light of the above, shareholders in Falcon Investments Societe Anonyme
are advised to exercise caution and consult their professional advisors when
dealing in these shares.
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