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RARECO - Audited Group Results for the year ended 30 June 2002
RARE EARTH EXTRACTION CO LIMITED
Incorporated in the Republic of South Africa
(Registration number 1989/003212/06)
Share code: RCO ISIN: ZAE000038329
Audited Group Results for the year ended 30 June 2002
Income statement
Audited Audited
2002 2001
R`000 R`000
Revenue - -
Profit for the - 3,302
year
Number of shares 39,300,000 28,852,269
in issue
Earnings per share - 11
(cents)
Less: acquisition - (11)
of loan claim from
minority
shareholder
Headline earnings - -
per share (cents)
Net asset value 37 41
per share (cents)
Note: The profit in 2001 of R3,302,000 resulted from the gain made on
the acquisition of a loan claim against a subsidiary from a minority
shareholder. As is consistent with prior periods, the net
income/expense of the company is capitalised directly to mining assets.
Summarised balance
sheet
Audited Audited
2002 2001
R`000 R`000
Assets
Non-current assets 14,800 13,101
Current assets 75 22
14,875 13,123
Equity and
liabilities
Shareholders` 14,544 11,797
funds
Non-current non- - 1,211
interest bearing
liabilities
Current 331 115
liabilities
14,875 13,123
Statement of changes in equity
Audited Audited
2002 2001
R`000 R`000
Shareholders`
funds
At beginning of 11,797 8,495
year
Net profit - 3,302
Shares issued 2,747 -
At end of year 14,544 11,797
Cash flow
statement for the
year ended 30 June
Audited Audited
2002 2001
R`000 R`000
Cash flows from 35 5
operating
activities
Cash flows from (1,696) (785)
investing
activities
Cash flows from 1,636 773
financing
activities
Net decrease in (25) (7)
cash and bank
balances
Cash and bank (3) 4
balances at the
beginning of the
year
Cash and bank (28) (3)
balances at the
end of the year
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 2001.
Audit opinion
These results have been audited by the
company`s auditors, Ernst & Young, and their
unqualified audit opinion
is available for inspection at the registered
office of the company. The audit opinion
includes 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
statements do not include any adjustments
relating to the
recoverability 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.
Comments
The
important
developments
during the
year under
review were:
- The Industrial Development Corporation
of South Africa Ltd (IDC) has in
principal approved a loan of
R 16 million to Rareco, subject to
several conditions, including the
raising of further equity capital.
The company also conducted negotiations
with other financial institutions for
the balance of the
finance required for the project.
- The application for the winding-up of
the company was withdrawn, ending three
years of
wasteful litigation.
- The issue of 4,147,731 new ordinary
shares to raise R 1,366,933 in cash
during 2002.
- Shareholders approved changes to the
company`s capital structure and the
issue of 6,300,000
shares to convert debt into equity, in
April 2002.
Rareco needs to conclude long-term contracts for the sale of its
products and raise further equity capital in order to receive finance
from the IDC and other lenders. The global economic slowdown has caused
commodity prices, including those of rare earths, to fall and has made
the conclusion of these contracts on satisfactory terms difficult for
the time being.
Going concern
The financial statements have been prepared on the going concern basis.
However, at present the group does not have sufficient funds to complete
the mining and processing project it has begun. The company is presently
negotiating to raise sufficient funds to complete its project.
TA BLENCH
Chairman
Cape Town
13 September 2002
Registered Transfer Sponsor:
Office: Secretary:
5A Pastorie Computershare Sasfin Bank Limited
Park Investor
Services
Limited
Cnr Lourens& 9th Floor, 70 Sasfin Place
Reitz Street Marshall
Street
Somerset Johannesburg, 13 - 15 Scott
West, 7130 2001 Street
Waverley, 2090
Directors: TA Blench (Chairman), RT Louw
(Managing), WN Gardyne*, KL
Bright*, G Paolucci* (Italian)
( * Non-Executive)
Date: 26/09/2002 05:15:00 PM Produced by the JSE SENS Department
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