| Fri 28 Sep 2001, 0:00 | | Rareco Group Audited Results For The Year Ended 30 |
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Rare Earth Extraction Co Limited
(Registration no 1989/003212/06)
JSE code: RCO - ISIN code: ZAE000005807
Income statement
(R'000) (R'000)
2001 2000
Revenue - -
Profit/(loss) for year 3,302 (3)
Number of shares in issue 28,852,269 28,852,269
Earnings per share (cents) 11 -
Less: Acquisition of loan claim from
minority shareholder (11) -
Headline earnings per share (cents) - -
Net asset value per share (cents) 41 29
Note: The profit for 2001 of R3,302,000
consists of the gain made on acquisition
of loan claim against a subsidiary from a
minority shareholder. As is consistent with
prior periods all other operating net
income/expenses of the company is capitalisead
to fixed assets.
Summarised balance sheet
Assets
Non-current assets 13,101 12,316
Current assets 22 12
13,123 12,328
Equity and liabilities
Shareholders' funds 11,797 8,495
Non-current non-interest
bearing liabilities 1,211 3,740
Current liabilities 115 93
13,123 12,328
Statement of changes in equity
Shareholders funds
At beginning of year 8,495 8,498
Net profit 3,302 (3)
At end of year 11,797 8,495
Cash flow statement
Cash flows from operating activities 5 (277)
Cash flows from investing activities (785) (490)
Cash flows from financing activities 773 438
Net decrease in cash (7) (266)
Cash at the beginning of the year 4 270
(Bank overdraft)/Cash at the end
of the year (3) 4
Compliance with Statements of Generally Accepted Accounting Practice and
accounting policies
The annual results have been prepared in accordance with Statements of
Generally Accepted Accounting Practice. There have been no changes effected
to any accounting policies which affect the group results and the methods of
computation applied are consistent in all respects with those in the annual
financial statements for the year ended 30 June 2000.
Audit Opinion
The financial information in this report has been audited by the company's
auditors Ernst & Young who intend expressing an unqualified audit opinion.
However, they intend adding an emphasis of matter paragraph indicating the
existence of a material uncertainty which may cast doubt about the group's
ability to continue as a going concern. The financial information does not
include any adjustments relating to the recoverability of assets that might
be necessary if the company is unable to continue as a going concern.
Comments
During the year under review, developments in the rare earth industry
continued to improve the outlook for the company's project to develop the
Steenkampskraal monazite mine and build rare earth processing facilities in
South Africa.
On September 13, 2001 the Appeal Court allowed a minority shareholder to
appeal (on one point only) against the High Court judgement to dismiss her
application to wind up the company. Notwithstanding this ruling, the
directors continue in their efforts to bring the project to fruition.
In this regard, the company's directors have achieved the following :
Negotiated the principles of an agreement with an international processor of
rare earths whereby they may purchase most of Rareco's annual production and
provide financial and technical assistance that will contribute to the
viability and success of the project;
Commenced negotiations with overseas and local institutions to finance the
estimated capital expenditure of R38 million;
Identified additional mineral resources that could expand and extend
Rareco's production; and
Subsequent to the year-end, concluded an issue of shares for cash whereby 1
147 731 ordinary shares are to be issued at a price of 25 cents each to
raise R286 932.
Going concern
The financial statements have been prepared on the going concern basis. The
company is presently negotiating to raise sufficient funds to complete its
project.
Accordingly, the financial statements do not include any adjustments
relating to the recoverability and classification of assets or to the amount
and classification of liabilities that might be necessary should the company
be unable to continue as a going concern.
Contingent Liability
There is a contingent liability in respect of the winding up application,
referred to above. Legal costs relating to the abovementioned appeal are
estimated at R207 000.
TA BLENCH
Chairman
Registered Office:
Blandford House
67 Caledon Street
Somerset West, 7130
Directors:
TA Blench (Chairman)
KL Bright (Managing)
WN Gardyne
RT Louw
GE Wolfe-Coote
Transfer Secretaries:
Mercantile Registrars Limited
10th Floor, 11 Diagonal Street
Johannesburg, 2000
Sponsor:
The Janus Corporation (Pty) Ltd
Ground Floor, West Wing, 25 Wellington Road, Parktown, 2193
