| Mon 27 Jun 2011, 8:00 | | GGM - Goliath Gold Mining Limited - Audited abridged consolidated financial |
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GGM
GGM
GGM - Goliath Gold Mining Limited - Audited abridged consolidated financial
results for the financial year ended 31 March 2011 and notice of Annual General
Meeting
Goliath Gold Mining Limited
(Formerly White Water Resources Limited)
Incorporated in the Republic of South Africa
(Registration number: 1933/004523/06)
Share code: GGM ISIN: ZAE000154753
("Goliath Gold" or "the company" or "the group")
AUDITED ABRIDGED CONSOLIDATED FINANCIAL RESULTS FOR THE FINANCIAL YEAR ENDED 31
MARCH 2011 AND NOTICE OF ANNUAL GENERAL MEETING
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Audited Restated
12 months to 12 months to
31 March 31 March
Change 2011 2010
% R`000 R`000
Other income 737 5
Operating expenses (14 232) (3 778)
Fair value adjustments 8 144 1 839
Profit on sale of financial assets
333 2 154
Exploration and prefeasibility
expenditure (1 776) (2 016)
Operating loss 278.3 (6 794) (1 796)
Finance income 257 81
Finance costs - -
Loss before taxation 281.2 (6 537) (1 715)
Taxation 392 (122)
Loss for the year 234.5 (6 145) (1 837)
Attributable to:
Equity holders of the group (6 145) (1 837)
Total ordinary shares in issue 424 629 379 370 547 286
Weighted average number of ordinary
shares in issue 388 179 530 370 547 286
Loss per share (cents) 220.0 (1.6) (0.5)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Audited at Restated at Restated at
31 March 31 March 31 March
2011 2010 2009
R`000 R`000 R`000
ASSETS
Non-current assets
Investment property 3 107 3 107 3 107
Property, plant and equipment 17 - -
Other financial assets - 891 -
Current assets
Other financial assets 23 515 21 702 18 547
Trade and other receivables - 16 -
Cash and cash equivalents 8 124 1 059 5 512
Total assets 34 763 26 775 27 166
EQUITY AND LIABILITIES
Share capital 305 504 292 489 290 789
Accumulated losses (274 850) (268 705) (266 568)
Equity attributable to equity
holders of the group 30 654 23 784 24 221
Non-current liabilities
Loans from shareholders - - 36
Deferred tax - 392 392
Current liabilities
Trade and other payables 2 734 1 224 1 219
Current tax payable 122 122 -
Other financial liabilities 1 253 1 253 1 298
Total equity and liabilities 34 763 26 775 27 166
Net asset value per share (cents) 7.2 6.4 6.5
Net tangible asset value per share 7.2 6.4 6.5
(cents)
CONSOLIDATED STATEMENT OF CASH FLOWS
Audited Audited
12 months to 12 months to
31 March 31 March
2011 2010
R`000 R`000
Cash utilised in operating (11 014) (5 719)
activities
Cash effect of investing activities 5 064 (53)
Cash effect of financing activities 13 015 1 319
Net cash change for the year 7 065 (4 453)
Cash at the beginning of the year 1 059 5 512
Net cash at the end of the year 8 124 1 059
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Total share Accumulated Total
capital losses equity
R`000 R`000 R`000
Opening balance at 01 April 2009 as 290 789 (265 067) 25 722
previously reported
Change in accounting policy - (1 501) (1 501)
Restated balance at 01 April 2009 290 789 (266 568) (24 221)
Restated comprehensive loss for the - (1 837) (1 837)
year
Treasury share transactions 1 700 (300) 1 400
Restated balance 01 April 2010 292 489 (268 705) 23 784
Total comprehensive loss for the year - (6 145) (6 145)
Issue of shares 13 015 - 13 015
Balance 31 March 2011 305 504 (274 850) 30 654
COMMENTARY
1 FINANCIAL STATEMENTS - BASIS OF PREPARATION
The financial statements of Goliath Gold Mining Limited for the financial
year ended 31 March 2011 ("financial year") have been prepared in
accordance with International Financial Reporting Standards, IAS 34, the
Companies Act of South Africa, 2008 (Act 71 of 2008) and the JSE Listings
Requirements, and are based on appropriate accounting policies,
consistently applied with those applied in the most recent audited
financial statements, except as set out below and in note 9, which are
supported by reasonable and prudent judgements and estimates.
During the financial year ended 31 March 2011, the group adopted the
following standards and interpretations which are effective for the current
financial year and which are relevant to its operations:
- IFRS 3 (Revised) Business Combinations
- IAS 27 (Amended) Consolidated and Separate Financial Statements
- IAS 28 Investments in Associates: Consequential amendments due to IAS 27
(Amended) Consolidated and Separate Financial Statements
- IAS 7 Statement of Cash Flows: Consequential amendments due to IAS 27
(Amended) Consolidated and Separate Financial Statements
- IAS 12 Income Taxes: Consequential amendments due to IAS 27 (Amended)
Consolidated and Separate Financial Statements
- IFRIC 18 Transfers of Assets from Customers
2009 Annual Improvements Project: Amendments to IAS 1 Presentation of
Financial Statements
- 2009 Annual Improvements Project: Amendments to IAS 7 Statement of Cash
Flows
- 2009 Annual Improvements Project: Amendments to IAS 17 Leases
- 2009 Annual Improvements Project: Amendments to IAS 18 Revenue
- 2009 Annual Improvements Project: Amendments to IAS 36 Impairment of Assets
- 2009 Annual Improvements Project: Amendments to IAS 38 Intangible Assets
- 2009 Annual Improvements Project: Amendments to IAS 39 Financial
Instruments: Recognition and Measurement
These results have been audited by the group`s auditors, PricewaterhouseCoopers
Incorporated, whose unqualified audit opinion is available along with the annual
report for inspection at the company`s registered office.
2 NATURE OF THE BUSINESS
The company`s main business is that of a mining exploration company. Its
subsidiaries are primarily engaged in the resource sector.
3 FINANCIAL AND OPERATIONAL PERFORMANCE
During the current financial year, the net loss of the group was R6.1
million, compared to a group net loss for the 2010 financial year of R1.8
million.
The loss per share and the headline loss per share of the group increased
from a restated loss of 0.5 cents per share to a loss of 1.6 cents per
share, reflecting a change of 220% over the twelve month period.
4 PROSPECTS AND FUTURE PERFORMANCE
On 12 November, 2010, White Water Resources Limited ("WWR") entered into an
acquisition agreement with Gold One International Limited ("Gold One"). The
acquisition agreement stipulates that Goliath Gold will acquire the
Megamine Business, as defined in the Goliath Gold Acquisition Circular
dated 25 February, 2011, from Gold One Africa Limited ("Gold One Africa"),
a wholly owned subsidiary of Gold One.
The acquisition consideration of ZAR 262,229,868 is to be settled by way of
the issue of 1,048,919,472 pre-consolidation WWR shares, valued at ZAR 0.25
each. The acquisition of the Megamine Business by WWR will effectively
result in a reverse takeover of WWR by Gold One Africa, with Gold One
Africa ultimately holding 71% of the share capital in WWR. The transaction
also includes a 10:1 share consolidation, which was completed on 13 May,
2011.
Subsequent to shareholders voting overwhelmingly in favour of the
transaction on 22 March, 2011, a new management team was also appointed.
Goliath Gold`s new management team is focused on creating value by
exploring and ultimately developing the company`s extensive future asset
base. This has already begun in earnest with the first few exploration
drillholes at Megamine having already been completed by Gold One. Although
the majority of the current resources have a medium depth profile, a number
of shallower targets also exist. The shallower targets are expected to
provide initial development opportunities as well as the necessary
foundations to access the deeper resources in future. An economic scoping
study has already been initiated at Megamine. The outcome of the current
surface exploration drilling program will form the basis of updating the
scoping study to a pre-feasibility study.
The company`s transformation into a new gold exploration and development
company has been well received by the market. Since the transaction`s
formal announcement on 13 October, 2010, Goliath Gold`s share price has
outperformed its gold mining peers on JSE Limited ("JSE") by over 150%. In
late 2010, the company, then still named WWR, also announced that it had
successfully raised approximately ZAR 13.5 million in new capital via the
placement of shares with institutional shareholders. Equity was raised at
ZAR 0.25 per share, which at the time was a premium of between 16.8% and
21.9% to the volume weighted average traded price of the company`s ordinary
shares (measured over the 30 business days prior to the signature dates of
the various subscription agreements). The capital raised has been, and will
be, used for exploration funding and general corporate purposes.
5 SEGMENTAL REPORTING
Management has determined the operating segments based on the reports
reviewed by the Board that are used to make strategic decisions. The Board
considers the business from a functional perspective and has identified two
reportable segments, namely Exploration and Other operations.
Exploration: Involved in potential mining, prospecting and exploration.
Other operations: Represents the interest received on investments.
Business Segment Information
Exploration Other operations
2011 2010 2011 2010
R`000 R`000 R`000 R`000
Revenue - - - -
Segment result (1 776) (516) (34 172) (31 269)
Operating loss (1 776) (516) (34 172) (31 269)
Finance income - - 31 439 31 571
Finance costs - - (26) -
Loss before tax (1 776) (516) (2 759) 302
Income tax - - 392 -
credit/(expenses)
Loss for the year (1 (516) (2 367) 302
776)
Attributable to:
- Equity holders (1 (516) (2 367) 302
776)
Business Segment Information (continued)
Eliminations Group
2011 2010 2011 2010
R`000 R`000 R`000 R`000
Revenue - - - -
Segment result 29 154 29 988 (6 794) (1 796)
Operating 29 154 29 988 (6 794) (1 796)
profit/(loss)
Finance income (31 182) (31 490) 257 81
Finance costs 26 - - -
Profit/(loss) before (2 002) (1 502) (6 537) (1 715)
tax
Income tax - (122) 392 (122)
credit/(expenses)
(Loss) for the year - - (6 145) (1 837)
Attributable to:
- Equity holders - - (6 145) (1 837)
6 POST-BALANCE SHEET EVENTS
In the opinion of the directors, no other matter or circumstance arising
since the end of the financial year to the date of this report, other than
that:
- The ordinary share capital of the company has been consolidated in the
ratio of one new share for every 10 shares held.
- The authorised share capital has been increased from 75,000,000 post
consolidation shares of ZAR 2.50 each (750,000,000 pre-consolidation shares
of ZAR 0.25 each) to 200,000,000 post consolidation shares of ZAR 2.50 each
(2,000,000,000 pre-consolidation shares of ZAR 0.25 each).
- The name of the company changed from WWR to Goliath Gold.
- The articles of association were amended.
- On 8 June, 2011 it was announced that the underground training centre at
the Sub Nigel 1 Shaft, would temporarily cease operations, including
production, due to rising water levels in the East Rand Basin. The Sub
Nigel mine forms part of the Megamine Business that will be acquired from
Gold One Africa.
The following details the litigation arising after the end of the financial
year:
The company terminated the agreement between White Water Limited, Covenant
Mining and Finance (SA) (Proprietary) Limited ("Covenant"), White Water
Gold (Proprietary) Limited ("White Water Gold") and the company in terms of
which the company sold to White Water Gold the Wit Nigel prospecting right.
The agreement was terminated by the company on the grounds that White Water
Gold and/or Covenant were unable to provide proof of funding as required by
the Department of Mineral Resources.
The company has launched an application against Bayete Minerals
(Proprietary) Limited, Robert Gray and Covenant for an order directing the
aforesaid respondents to restore certain records and plans pertaining to
Wit Nigel, to the company.
7 DIRECTORATE
During the year under review and up to the date of this report, the
following changes in function took place:
- The following directors resigned:
- Sandile Swana
- Waron Mann
- Stephen Black
- Charles Pettit
- Peter van Zyl
- Hylton Cochrane
- The following directors were appointed:
- Mark Wheatley
- Neal Froneman
- Christopher Chadwick
- David Hodgson
- Phil Lambert
- Keith Rayner
- Jerry Vilakazi
8 DIVIDENDS
In accordance with the Memorandum and Articles of Association of the
company, dividends are proposed and approved by the Board, based on interim
and year-end financial performances. Payments of dividends will depend on
the Board`s ongoing assessment of Goliath Gold`s earnings, financial
position, including its cash requirements, future earnings prospects and
other relevant factors.
No dividends were declared or paid to shareholders during the current
financial year.
9 PRIOR YEAR ADJUSTMENTS
To align the group`s accounting policies to those of Gold One International
limited in anticipation of the acquisition of the Megamine Business of Gold
One Africa, management has adopted the policy of accounting for exploration
and evaluation costs as expenses in profit or loss instead of capitalising
these expenses to Property, plant and equipment or Intangible assets. This
has resulted in the group restating is comparative information
retrospectively. Full details of the restatement are included in the annual
financial statements.
10 NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the annual general meeting of Goliath Gold
shareholders is to be held at 09:00 on Friday, 26 August 2011 at the
offices of Goliath Gold, 55 Empire Road, Parktown, Johannesburg, 2193.
The annual financial statements for the year ended 31 March 2011,
incorporating a notice of annual general meeting, will be mailed to all
shareholders on or about 30 June 2011.
For and on behalf of the Board
Neal Froneman Christopher Chadwick
Chief Executive Officer Chief Financial Officer
Johannesburg
27 June 2011
Directors:
M Wheatley# (Chairman), N Froneman (Chief Executive Officer),
C Chadwick (Chief Financial Officer), K Rayner* (Deputy Chairman),
D Hodgson*, J Vilakazi*, P Lambert*.
#Non-executive *Independent Non-executive
REGISTERED OFFICE
45 Empire Road, Parktown, Johannesburg, 2193
COMPANY SECRETARY
Pierre Baart Kruger
45 Empire Road, Parktown, Johannesburg, 2193
SPONSOR
Merchantec Capital
AUDITORS
PricewaterhouseCoopers Inc.
Date: 27/06/2011 08:00:01 Produced by the JSE SENS Department.
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