| Tue 29 May 2012, 15:11 | | MMH - Miranda Mineral Holdings Limited - MMH- Reviewed condensed consolidated |
|
MMH
MMH
MMH - Miranda Mineral Holdings Limited - MMH- Reviewed condensed consolidated
financial results for the six months ended 29 February 2012
Miranda Mineral Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1998/001940/06)
Share code: MMH? ISIN: ZAE000074019
("Miranda" or "the Group" or "the Company")
Reviewed condensed consolidated financial results for the six months ended 29
February 2012
Condensed Consolidated Statement of Financial Position
(Figures in R `000) Reviewed Restated Audited
29 Feb 2012 28 Feb 2011 31 Aug 2011
Assets
Non-Current Assets 55,708 76,546 56,141
Property, plant and 19,556 18,792 19,656
equipment
Intangible assets 33,821 55,213 34,047
Other financial assets 2,331 2,541 2,438
Current Assets 4,608 5,360 6,022
Trade and other receivables 1,835 1,223 3,311
Cash and cash equivalents 2,773 4,137 2,711
Total Assets 60,316 81,906 62,163
Equity and Liabilities
Equity (4,048) 57,762 12,468
Share capital 115,051 115,051 115,051
Accumulated loss (116,998) (56,384) (100,830)
Equity Attributable to (1,947) 58,667 14,221
Equity Holders of Parent
Non-controlling interest (2,101) (905) (1,753)
Liabilities 64,364 24,144 49,695
Non-Current Liabilities 11,363 9,795 10,997
Finance lease obligation 386 1,294 755
Deferred tax 380 221 327
Environmental rehabilitation 10,597 8,280 9,915
provisions
Current Liabilities 53,001 14,349 38,698
Loans from shareholders 32,012 2,928 16,268
Finance lease obligation 909 1,012 1,056
Operating lease liability - 22 27
Trade and other payables 20,080 10,387 21,347
Total Equity and Liabilities 60,316 81,906 62,163
(1.4) 20.3 4.4
Net asset value per share
(cents)
Net tangible asset value per (13.3) 0.9 (7.6)
share (cents)
Shares in issue - closing 284,511 284,511 284,511
number
Condensed Consolidated Statement of Comprehensive Income
(Figures in R `000) Reviewed Restated Audited
six months six months year
ended ended ended
29 Feb 2012 28 Feb 2011 31 Aug 2011
Operating loss before (15,387) (11,203) (54,494)
interest and tax
Investment income 26 201 268
Fair value adjustment 62 73 (30)
Finance costs (1,164) (113) (774)
Loss before taxation (16,463) (11,042) (55,030)
Taxation (53) - (106)
Loss for the period (16,516) (11,042) (55,136)
Total comprehensive loss (16,516) (11,042) (55,136)
Loss and total comprehensive
loss attributable to:
Equity holders of the parent (16,168) (11,000) (54,063)
Non-controlling interest (348) (42) (1,073)
(16,516) (11,042) (55,136)
Weighted average number of 284,511 284,511 284,511
shares in issue
Loss per share (cents) (5.7) (3.9) 19.0
No dilution effect as losses
were incurred
(5.7) (3.9) 11.3
Headline loss per share
(cents)
Reconciliation :
Loss after taxation (16,168) (11,000) (54,063)
attributable to equity
holders of the parent
Impairments - - 22,228
Non-controlling interest - - (114)
effect of adjustment
Headline earnings (16,168) (11,000) (31,949)
Condensed Consolidated Statement of Cash Flows
(Figures in R `000) Reviewed Restated Audited
six months six months year
ended ended ended
29 Feb 2012 28 Feb 2011 31 Aug 2011
Cash used in operations (10,646) (13,496) (25,314)
Interest income 26 201 268
Finance costs (67) (113) (341)
Net cash from operating (10,687) (13,408) (25,387)
activities
Net cash from investing 127 (6,534) (8,393)
activities
Net cash from financing 10,622 (474) 11,938
activities
Total cash movement for the 62 (20,416) (21,842)
period
Cash at the beginning of the 2,711 24,553 24,553
period
Total cash at end of the 2,773 4,137 2,711
period
Restated Condensed Consolidated Statement of Changes in Equity
REVIEWED Share Share Re- Retained Non- Total
capital premium valua- income control- equity
tion ling
(Figures in R reserve interest
`000)
Opening balance 2,845 112,206 115,051 239,138 (863) 353,326
as previously
reported
Prior year - - - (284,522) - (284,522)
adjustments
Balance at 01 2,845 112,206 115,051 (45,384) (863) 68,804
Sep 2010 as
restated
Total - - - (54,063) (1,073) (55,136)
comprehensive
loss for the
year
Business - - - (1,383) 183 (1,200)
combinations
Total changes - - - (55,446) (890) (56,336)
Balance at 01 2,845 112,206 115,051 (100,830) (1,753) 12,468
Sep 2011
Total - - - (16,168) (348) (16,516)
comprehensive
loss for the
year
Balance at 29 2,845 112,206 115,051 (116,998) (2,101) (4,048)
Feb 2012
Group Segmental Analysis
IFRS 8: Operating Segments requires operating segments to be identified on the
basis of internal reports about components of the Group that are regularly
reviewed by the chief operating decision-maker in order to allocate resources to
the segments and to assess their performance. The chief operating decision-maker
has been identified as the Executive Committee that makes strategic decisions.
The Group has identified its operating segments based on its main exploration
divisions and aggregated them into coal, diamonds, gold, base metals and
industrial minerals and other. These values have been reconciled to the
consolidated financial results. The measures reported on by the Group are in
accordance with the accounting policies adopted for preparing and presenting the
consolidated financial statements.
Segment operating expenses comprise all operating expenses of the different
reportable segments and are either directly attributable to the reportable
segment, or can be allocated to the reportable segment on a reasonable basis.
The segment assets and liabilities comprise all assets and liabilities of the
different segments that are employed by the reportable segments and are either
directly attributable to the reportable segments, or can be allocated to the
reportable segment on a reasonable basis.
(Figures in R`000) Coal Diamonds Gold Base Other Group
Metals &
Industrial
Minerals
Reviewed six months ended 29 Feb 2012
Segment result: (5,108) (76) (20) (30) (11,229) (16,463)
Loss before
taxation
Taxation (45) (5) (1) (2) - (53)
Loss after (5,153) (81) (21) (32) (11,229) (16,516)
taxation
Depreciation on 693 75 15 23 12 818
and impairment of
property, plant
and equipment
Segment assets 55,686 456 106 642 3,426 60,316
Mining properties 17,222 - - - - 17,222
Development 13,140 - - - - 13,140
properties
Exploration and 11,025 271 69 75 - 11,440
evaluation asset
Mineral rights 8,929 - - 311 - 9,240
Other assets 5,370 185 37 256 3,426 9,274
Segment (20,181) (225) (45) (68) (43,845) (64,364)
liabilities
Restated six months ended 28 Feb 2011
Segment result: 4,392 1,532 382 688 4,048 11,042
Loss before
taxation
Taxation - - - - - -
Loss after 4,392 1,532 382 688 4,048 11,042
taxation
Depreciation on 691 74 15 22 16 818
property, plant
and equipment
Segment assets 53,692 637 143 22,716 4,718 81,906
Mining properties 14,882 - - - - 14,882
Capital work-in- 13,153 - - - - 13,153
progress
Exploration and 10,388 282 72 79 - 10,821
evaluation asset
Mineral rights 8,929 - - 22,310 - 31,239
Other assets 6,340 355 71 327 4,718 11,811
Segment (17,638) (627) (126) (188) (5,565) (24,144)
liabilities
Audited year ended 31 Aug 2011
Segment result: (6,686) (1,599) (344) (22,592) (23,809) (55,030)
Loss before
taxation
Taxation (90) (11) (2) (3) - (106)
Loss after (6,776) (1,610) (346) (22,595) (23,809) (55,136)
taxation
Depreciation on 1,355 151 30 45 63 1,644
property, plant
and equipment
Segment assets 56,875 643 144 718 3,783 62,163
Mining properties 16,539 - - - - 16,539
Capital work-in- 13,140 - - - - 13,140
progress
Exploration and 11,218 293 74 82 - 11,667
evaluation asset
Mineral rights 8,929 - - 311 - 9,240
Other assets 7,049 350 70 325 3,783 11,577
Segment (19,604) (348) (70) (104) (29,569) (49,695)
liabilities
Commentary
The Board of Directors welcomes this opportunity to update the shareholders of
Miranda on some of the exciting developments impacting on their investment
during the first six months of the 2012 financial year.
The reviewed condensed consolidated interim financial results of the Group for
the six month period ended 29 February 2012 comprise the results of the Company
and its subsidiaries. In light of recent changes in directorships and
management, the Board decided it prudent to have the Group`s interim financial
results reviewed on a voluntary basis.
The Group`s auditors, Deloitte & Touche, have reviewed these results and a copy
of their modified review report is available for inspection at the Group`s
registered office. Their report includes an emphasis of matter paragraph on
going concern as the matters detailed in paragraph 8 below indicate the
existence of a material uncertainty which may cast significant doubt on the
Group`s ability to continue as a going concern. Their review was conducted in
terms of ISRE 2410: Review of Interim Financial Information Performed by the
Independent Auditor of the Entity.
1. PRESENTATION OF CONDENSED CONSOLIDATED INTERIM RESULTS
The condensed consolidated interim results have been prepared in accordance
with the framework concepts and the measurement and recognition
requirements of International Financial Reporting Standards (IFRS), the AC
500 standards as issued by the Accounting Practices Board and the
information as required by IAS 34: Interim Financial Reporting, Listing
Requirements of the JSE Limited, and the Companies Act of South Africa (Act
71 of 2008). In the preparation of these interim financial results, the
Group has applied key assumptions concerning the future and other
indeterminate sources in recording various assets and liabilities.
The Group`s principal accounting policies and assumptions applicable to the
financial year end 31 August 2011 have been applied consistently over the
interim results.
The interim financial information was prepared under the supervision of the
CFO, Ms Mari-Alet van der Merwe CA(SA).
2. STRATEGIC AND CORPORATE REVIEW
The reconstituted Board and management team have made good progress in
formulating and implementing a refocused strategy for Miranda with the sole
objective of realising maximum value for all shareholders. This will be
attained by clearly defining Miranda`s identity and positioning within the
mining sector, in general, and the (junior) coal mining subsector, in
particular. To these ends, the Board has mandated the executive management
to pursue a number of initiatives, including reviewing the current
portfolio of both coal and non-coal assets, defining core and non-core
assets, considering potential acquisition opportunities and re-examining
the capitalisation of the Group.
3. OPERATIONAL REVIEW
Management`s operational focus during the period under review was evident
in a number of important areas. Good progress was made on the internal
review being conducted of all the projects in the Coal Division. Management
also maintained their focus on resolving the outstanding operational and
contingent matters as previously disclosed. Lastly, the executive team
continued laying the foundation for Miranda`s long-awaited move into active
coal mining.
Sesikhona project
Once discussions regarding mining sub-contracting and off-take
agreements for Sesikhona have been finalised, mining of Sesikhona`s
anthracite coal deposit is expected to commence during calendar year
2012.
Uithoek project
The re-negotiation of the JV agreement with the Simpson family (who
holds the Mining Right), is considered a matter of priority.
Agreement in principle has been reached to restore the relationship
and term sheets are in the process of being drawn up. Further
information will be provided as soon as available.
Burnside project
A decision by the Department of Mineral Resources in respect of the
Company`s application for a Mining Right is understood to be
imminent.
Boschhoek project
The Board is pleased to report that the SA National Defense Force has
agreed to enter into discussions with a view to discuss their
concerns in an attempt to settle the dispute relating to one of the
farms where there is possible unexploded ordnance.
Other projects - as part of management`s ongoing review, the
following projects were exited and sold back to the original joint
venture partners, with Miranda recovering its costs:
Dannhauser project area: Hillside project (co. Socratime (Pty) Ltd);
Dannhauser project area: Solmar project (co. Matlotlo Trading 174
(Pty) Ltd);
Klipriver South project area: Spetskop project (co. Sangriblox (Pty)
Ltd); and
Vryheid East project area: Uitkomst project (co. Turnover Trading 225
(Pty) Ltd).
Management`s focus in the other, non-coal operating divisions has been, and
will continue to be, to work towards a resolution with the DMR in respect
of its overdue and/or disputed Prospecting Rights.
Other than as disclosed in these interim financial results, there were no
material changes during the six months ended 29 February 2012 from the
information as disclosed in the 2011 Annual Report in respect of the
Company`s exploration activities and results.
Contingencies
As previously reported, the arbitration proceedings between Sesikhona and
Stefanutti Stocks Mining Services ("SSMS"), regarding outstanding amounts
and claims in respect of a mining contract with SSMS, remain on hold
pending the outcome of settlement negotiations.
Other contingencies relate to the status of the Uithoek and Boschhoek
projects, as reported on above, as well as the claim regarding the alleged
commission on the cancelled claw back transaction, as mentioned under
`Other Disputes` in the Directors` Report to the 2011 Integrated Report.
4. FINANCIAL REVIEW
The comparative February 2011 financial results of the Group have been
restated to reflect the derecognition of the Rozynenbosch asset from the
Group`s intangible assets. This has had the effect of reducing the net
asset value of the Group by approximately R284.5 million, equivalent to a
decline of 100 cents per share ("cps") from 120.3 cps to 20.3 cps as at 28
February 2011.
On 29 February 2012, the net asset value and net tangible asset value of
the Company amounted to -R4.0 million and -R37.9 million respectively
(restated 2011: R57.8 million and R2.5 million). This was equivalent to
-1.4 cps and -13.3 cps (restated 2011: 20.3 cps and 0.9 cps), which
represents a decline of 21.7 cps and 14.2 cps, respectively. Incubex
Minerals Limited, a shareholder, have subordinated its loan and the
conversion thereof, and agreed to support the Group until such time as
projects are operational and generating sufficient cash flow.
Current liabilities of R53 million exceed current assets of R4.6 million by
R48.4 million. Current liabilities include the amount of R7 million
invoiced by SSMS (as disclosed under contingencies) and the shareholder
loans yet to be converted.
With no projects yet in production, the Group showed no revenue for the
period (2011: Rnil). The increase in operating expenses for the six months
(R15.4 million; 2011: R11.2 million) was mainly due to significant
consulting, legal and compliance costs incurred as a consequence of the
Company`s focus on securing existing assets and claims in order to build
sustainability. The resultant net loss for the period was R16.5 million
(2011: R11.0 million).
5. EVENTS SUBSEQUENT TO BALANCE SHEET DATE
An annual general meeting of shareholders was held on 2 April 2012.
Shareholders passed the requisite resolutions to facilitate the Group`s
capital raising activities by placing the authorised, unissued shares of
the Company under the control of the directors. Other subsequent events
include the sale of the helicopter for an amount of R3.7 million.
6. CHANGES TO THE BOARD
During the financial period under review, Ms Esther Johnson resigned as
Financial Director of Miranda on 30 March 2012 and was replaced by Ms Mari-
Alet van der Merwe effective same date.
7. GROUP PROSPECTS
The benefits of having the collective attention of the management team
dedicated to operational issues and the exploitation of assets are expected
to begin unlocking value in the Company for shareholders during calendar
year 2012. The Board will be focusing both on opportunities to grow by
acquisition and on implementing its strategy of fast-tracking and bringing
to account Miranda Coal`s most advanced coal projects in KZN.
8. STATEMENT ON GOING CONCERN
The following conditions are impacting on the Group`s ability to continue
as a going concern:
* Losses incurred and the net liability and net current liability position -
as disclosed in the financial review paragraph;
* Cash flow - factors taken into consideration include the available Incubex
funding, and the Group`s focus on generating operational cash flow from
existing resources before the end of calendar year 2012; and
* Litigation matters - as disclosed under the contingencies paragraph.
Management has the following plans in place to address the above conditions
affecting the Group`s ability to continue as a going concern:
* The stringent control of expenditure to ensure efficient and cost effective
delivery by service providers in line with our Group strategy;
* Focus is placed on the signing of off-take agreements for our Sesikhona and
Uithoek projects to deliver operational cash flow in line with our cash
flow forecast;
* Reaching settlement on all litigation matters to enable the Group to
proceed with our emphasis on core business; and
* Continue the relationship with Incubex for its continuous support.
The directors realise that the conditions referred to in the preceeding
paragraphs indicate the existence of a material uncertainty which may cast
significant doubt on the Group`s ability to continue as a going concern.
The directors are confident that the plans put in place will address those
concerns and will result in consistency enabling the Group to deliver on
shareholder expectations.
9. DIVIDENDS
No dividends were recommended or declared for the period under review
(2011: nil).
For and on behalf of the Board
Dr L Mohuba A Johnson M van der Merwe
Chairperson Chief Executive Officer Chief Financial Officer
Centurion
29 May 2012
Sponsor:
PricewaterhouseCoopers Corporate Finance (Proprietary) Ltd, 2 Eglin Road,
Sunninghill, 2157
(Private Bag X36, Sunninghill, 2157)
Transfer Secretaries:
Computershare Investor Services (Pty) Limited, 70 Marshall Street, Johannesburg,
2001
(PO Box 61051, Marshalltown, 2107)
Tel: 011 370 5000
Company Secretary and place where registers are kept:
Fusion Corporate Secretarial Services (Pty) Ltd, represented by Melinda van den
Berg, Nr 56 Regency Road, Route 21 Corporate Park, Nellmapius Drive, Irene,
Centurion
(PO Box 68528, Highveld, 0169)
Tel: 087 550 1123
Company registered office:
Ground Floor, Pecanwood Building, The Greens Office Park, Charles de Gaulle
Crescent, Highveld Techno Park, Centurion
(PO Box 1045, North Riding, 2162)
Tel: 012 665 4200 Fax: 012 665 4258
Email: info@mirandaminerals.com
www.mirandaminerals.com
Date: 29/05/2012 15:11:01 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
