| Thu 10 Oct 2002, 9:50 | | Southern Mining Corporation Limited - Interim Repo |
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Southern Mining Corporation Limited - Interim Report For The Six Months Ended 31
August 2002
Southern Mining Corporation Limited
(Incorporated in the Republic of South Africa)
(Registration number 1996/014149/06)
("Southern Mining")
(Share Code: SMC ISIN number: ZAE000029799)
INTERIM REPORT FOR THE SIX MONTHS ENDED 31 AUGUST 2002
CONSOLIDATED INCOME STATEMENT Unaudited
six months Audited
ended year ended
31 August 28 February
2002 2002
Operating profit before exceptional
items, interest and tax 12 262 620 50 156 134
Net interest received 3 602 526 8 418 031
Exceptional items - (4 868 567)
Net profit before taxation 15 865 146 53 705 598
Taxation - -
Net profit after taxation 15 865 146 53 705 598
CONSOLIDATED BALANCE SHEET Unaudited Audited
31 August 28 February
2002 2002
ASSETS
Non-current assets
Mining rights, prospecting options and
deferred exploration expenditure 200 308 781 180 044 643
Plant and equipment 186 941 220 087
Current assets
Accounts receivable 1 878 017 806 187
Cash and cash equivalents 225 482 637 254 838 080
Total assets 427 856 376 435 908 997
EQUITY AND LIABILITIES
Capital and reserves
Share capital 899 299 899 299
Share premium 178 298 525 178 298 525
Foreign currency translation reserve 52 018 274 67 537 302
Retained earnings 184 571 385 168 706 239
Capital and reserves 415 787 483 415 441 365
Non-current liabilities
Long-term borrowings 8 027 901 5 287 694
Long-term environmental provision 500 000 500 000
Current liabilities
Accounts payable 3 540 992 14 679 938
Total equity and liabilities 427 856 376 435 908 997
Weighted average shares in issue 89 929 905 89 929 905
Headline profit per share (cents) 17,6 59,7
Earnings per share (cents) 17,6 59,7
Net asset value per share (cents) 462,3 462,0
CONSOLIDATED CASH FLOW STATEMENT Unaudited
six months Audited
ended year ended
31 August 28 February
2002 2002
Operating activities 3 687 515 69 961 694
Cash generated by operating activities 84 989 61 543 663
Net interest received 3 602 526 8 418 031
Investing activities (20 264 137) (59 346 725)
Acquisition of plant and equipment - (213 254)
Proceeds on disposal of plant
and equipment - 179 410
Prospecting options acquired and
deferred exploration expenditure (20 264 137) (59 312 881)
Financing activities
Increase in long-term borrowings 2 740 207 4 837 557
Net movement in cash and
cash equivalents (13 836 415) 15 452 526
(Decrease)/increase in foreign
currency translation reserve (15 519 028) 66 401 145
Cash and cash equivalents
at beginning of period 254 838 080 172 984 409
Cash and cash equivalents
at end of period 225 482 637 254 838 080
Represented by:
Cash and cash equivalents 225 482 637 254 838 080
STATEMENT OF CHANGES IN EQUITY Foreign
Ordinary currency
share Share translation Retained
capital premium reserve earnings Total
Balance at
28 February
2001 899 299 178 298 525 1 136 157 115 000 641 295 334 622
Foreign
currency
translation
differences 66 401 145 66 401 145
Net profit for
the period 53 705 598 53 705 598
Balance at
28 February
2002 899 299 178 298 525 67 537 302 168 706 239 415 441 365
Foreign currency
translation
differences (15 519 028) (15 519 028)
Net profit for
the period 15 865 146 15 865 146
Balance at
31 August
2002 899 299 178 298 525 52 018 274 184 571 385 415 787 483
COMMENTS
1. FINANCIAL AND CORPORATE
1.1 Financial results
The Company recorded a profit after tax of R15,9 million during the six-month
period.
Non-refundable contributions to the Bankable Feasibility Study ("BFS") of the
Corridor Sands Project ("Corridor Sands") from WMC Limited ("WMC") of Australia
amounting to R17,9 million resulted, after overhead costs, in an operating
profit of R12,3 million.
The Industrial Development Corporation of South Africa Limited (the "IDC") has
to date advanced R8,0 million towards the cost of the BFS. This advance is
reflected as a long-term liability, and will be capitalised on project go-ahead
or waived should the IDC not participate therein.
1.2 Cash position
Southern Mining`s net cash resources, after adjusting for accounts payable and
receivable, decreased by R17,1 million to R223,8 million (representing R2,49 per
share), primarily as a result of a decrease in the foreign currency translation
reserve following the strengthening of the Rand.
2. THE CORRIDOR SANDS PROJECT - MOZAMBIQUE
Since November 2000 WMC has carried out the BFS of the Corridor Sands Project.
The first phase was completed in July 2002 at a cost of R87 million. The BFS
results have confirmed and improved most aspects of the project since the
completion of the Full Feasibility Study by Southern Mining in August 2000.
The BFS results incorporate compelling project returns, more than commensurate
with the risks inherent in a project of this nature.
These positive results enable WMC, the IDC and Southern Mining to proceed with
the final phase of the BFS, which will entail the procurement of conditional
term sheets for limited recourse project finance, followed by final financial
closure.
A feature of the BFS is the minimal environmental impact, legacy-free
foundation and long life, which together enable Corridor Sands truly to
contribute to the sustainable development of all its stakeholders.
3. WMC
WMC has disclosed that it intends to separate by Scheme of Arrangement into two
separate companies, namely Alumina Limited and WMC Resources Limited. These
plans have been deferred pending the passing of new demerger tax legislation
which is currently before the Australian legislature.
Southern Mining is potentially affected by this process and continues to
monitor developments. Southern Mining has to date declined to waive or vary any
of its rights in respect of the Corridor Sands Project Agreement with WMC until
the requisite detailed data, pursuant to the demerger, has been made available
and considered.
4. SHARE BUY-BACK
In terms of a Special Resolution passed at the Annual General Meeting of
shareholders on 28 June 2001 and renewed on 27 August 2002, Southern Mining is
empowered to purchase its own issued shares through the JSE Securities Exchange.
No shares have been so acquired to date.
The Company believes that the current share price does not reflect the
underlying value of Southern Mining`s participation in Corridor Sands. The
directors intend to implement a share buy-back programme when circumstances are
considered appropriate.
These financial statements have been prepared in accordance with South African
Statements of Generally Accepted Accounting Practice.
The accounting policies applied are consistent with those applied in the
previous financial period.
These financial statements have been reviewed by the Company`s auditors, KPMG
Inc. The review opinion is available for inspection at the company`s registered
office.
By order of the board
AMD Gnodde
RG Still Directors
Randburg
9 October 2002
Registered office
Pangea House, Central Park Suites
Cnr Main Street and Orchard Avenue
Bordeaux, Randburg, 2194
(PO Box 3968, Randburg, 2125)
Transfer secretaries
Computershare Investor Services Limited
9th Floor
11 Diagonal Street, Johannesburg, 2001
(PO Box 1053, Johannesburg, 2000)
Investor relations
Tel (+27 11) 781-0375
Fax (+27 11) 886-7020
E-mail general@southern-mining.com
www.southern-mining.com
Date: 10/10/2002 07:15:00 AM Produced by the JSE SENS Department
