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Randgold & Exploration Company Limited -
Randgold & Exploration Company Limited
Reg. No 1992/005642/06
Share code : RNG
ISIN: ZAE000008819
NASDAQ trading symbol: RANGY
INTERIM REPORT FOR THE SIX MONTHS ENDED 30 JUNE 2003
* Consolidated earnings per share increases by 430%
* Board representation is broadened
* Major empowerment deal reaffirms commitment to build a profitable exploration,
development and mining business
* Randgold Resources share sale realises R126 million and is applied to
eliminate debt and to supporting its South African business plan
* Drilling starts in northern bushveld
* Randgold Resources continues to perform
CONSOLIDATED INCOME STATEMENT
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
30 Jun 30 Jun 31 Dec
R000 2003 2002 2002
Revenue
Gold sales - 404 064 404 064
Cost and expenses
Cash operating costs - (119 081) (127 379)
Royalties - (27 220) (27 220)
Total cash costs - (146 301) (154 599)
Operating profit from
mining activities - 257 763 249 465
Dividends and interest
received 1 571 1 701 3 766
Interest expense (5 673) (33 303) (40 139)
Depreciation and
amortisation (76) (41 947) (42 009)
Exploration and corporate
expenditure (11 052) (69 702) (63 121)
Profit/(loss) on sale of
investments 3 142 (2 096) (1 493)
Other 4 468 (28 206) 31 796
Income/(loss) on ordinary
activities (7 620) 84 210 138 265
Share of pre-tax income
from associate 126 471 - 285 627
Income/(loss) on ordinary
activities before taxes
and minority interest 118 851 84 210 423 892
Income and mining taxes - - -
Income/(loss) on ordinary
activities before
minority interest 118 851 84 210 423 892
Minority interest - (39 201) (38 594)
Headline earnings for
the period 118 851 45 009 385 298
Profit on the sale of
shares in Randgold
Resources 81 771 - -
Net income/(loss) for
the period 200 622 45 009 385 298
Ordinary shares in issue
(000s) 44 354 43 334 41 702
Earnings/(loss) per share
(cents) 452 104 895
Fully diluted earnings/
(loss) per share (cents) 450 101 887
Headline earnings/(loss)
per share (cents) 268 104 895
Fully diluted headline
earnings/(loss) per share
(cents) 267 101 887
CONSOLIDATED CASH FLOW STATEMENT
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
30 Jun 30 Jun 31 Dec
R000 2003 2002 2002
Net cash provided by/
(utilised in)
operations (12 142) 51 978 73 476
Net cash provided by/
(utilised in) investing
activities 141 628 15 890 (74 554)
Net cash (utilised in)/
provided by financing
activities (54 312) (68 847) (98 991)
Net (decrease)/increase
in cash and cash
equivalents 75 174 (979) (100 069)
Cash and cash equivalents
at beginning of period 22 003 122 072 122 072
Cash and cash equivalents
at end of period 97 177 121 093 22 003
CONSOLIDATED BALANCE SHEET
Unaudited Unaudited Audited
at at at
30 Jun 30 Jun 31 Dec
R000 2003 2002 2002
ASSETS
Current assets
Cash and equivalents 97 177 142 310 22 003
Receivables 9 540 182 638 6 219
Inventories - 111 684 -
Total current assets 106 717 436 632 28 222
Property, plant, equipment
and other long-term
assets 15 184 861 074 14 872
Investments 85 380 175 341 150 028
Investment in associate 521 744 - 495 798
Total assets 729 025 1 473 047 688 920
LIABILITIES AND
SHAREHOLDERS" EQUITY
Current liabilities
Accounts payable and
accrued liabilities 21 882 382 014 89 291
Bank overdraft - 21 217 -
Total current liabilities 21 882 403 231 89 291
Long-term liabilities
Provision for post
retirement benefits 52 000 53 077 52 000
Long-term loans - 530 804 -
Provision for
rehabilitation - 46 499 -
Loans from outside
shareholders - 226 439 -
Total long-term
liabilities 52 000 856 819 52 000
Total liabilities 73 882 1 260 050 141 291
Shareholders" equity
Share capital 448 433 437
Share premium 307 094 288 811 292 929
Other reserves 549 264 717 054 656 548
Accumulated losses (201 663) (742 575) (402 285)
Total shareholders"
equity 655 143 263 723 547 629
Minority interest - (50 726) -
Total liabilities and
equity 729 025 1 473 047 688 920
MOVEMENT IN SHAREHOLDERS" EQUITY
Unaudited Unaudited Audited
6 months 6 months 12 months
ended ended ended
30 Jun 30 Jun 31 Dec
R000 2003 2002 2002
Balance at beginning of
period 547 629 164 072 164 072
Share options exercised 14 176 17 251 21 373
Other reserves (107 284) 37 391 (23 114)
Net income/(loss) for
the period 200 622 45 009 385 298
Closing balance 655 143 263 723 547 629
NET ASSET FAIR VALUE
Net Asset Fair Value for Randgold & Exploration Company Limited (Unaudited)
Market
Price value
per 30 June
Units share Percent 2003
DESCRIPTION held R held R000
Listed investments
Durban Roodepoort Deep,
Limited 3 521 513 19.30 2.0% 67 965
Western Areas Limited 107 755 36.25 0.1% 3 906
JCI Gold Limited 18 848 838 0.66 1.4% 12 440
Kelgran Limited 2 321 115 0.46 2.7% 1 068
Randgold Resources
Limited 12 312 480 126.64 42.9% 1 559 253
1 644 632
Other assets 152 645
Liabilities (73 882)
Net assets 1 723 395
Shares in issue (000) 44 354
NAV per share (cents) 3 886
SEGMENTAL ANALYSIS OF THE NET PROFIT/(LOSS)
Randgold Randgold &
Resources Minrico Exploration
R000 Limited Limited Corporate Total
FOR THE 6 MONTHS ENDED 30 JUNE 2003
Gold sales - - - -
Total cash cost - - - -
Cash profit - - - -
Net interest - - (4 102) (4 102)
Depreciation - (26) (50) (76)
Profit/(loss) on
sale of investment - - 84 913 84 913
Exploration and
corporate
expenditure - (878) (10 174) (11 052)
Other - 231 4 237 4 468
Profit/(loss) before
tax, equity income
and minority
interest - (673) 74 824 74 151
Equity income from
associate 126 471 - - 126 471
Tax and minority
interest - - - -
Net profit/(loss)126 471 (673) 74 824 200 622
Randgold Randgold &
Resources Minrico Exploration
R000 Limited Limited Corporate Total
FOR THE 6 MONTHS ENDED 30 JUNE 2002
Gold sales 404 064 - - 404 064
Total cash cost (146 301) - - (146 301)
Cash profit/
(loss) 257 763 - - 257 763
Interest (21 966) - (9 636) (31 602)
Depreciation (41 947) - - (41 947)
Loss on sale of
investment - - (2 096) (2 096)
Exploration and
corporate
expenditure - (63 121) (282) (6 299) (69 702)
Other (34 118) 389 5 523 (28 206)
Profit/(loss)
before tax and
minority
interest 96 611 107 (12 508) 84 210
Equity income
from associate - - - -
Tax and minority
interest (39 201) - - (39 201)
Net profit/(loss) 57 410 107 (12 508) 45 009
COMMENTS
In June 2003 the Group disposed of 1 million of its shares in Randgold Resources
receiving R126 million. This transaction reduced the stake in that company to
42.9%.
The proceeds from the sale of the shares were used to repay loans including the
amount of R34.9 million owing to Consolidated Mining Management Services Limited
as well as the balance of R20 million in respect of the ABSA loan.
During the period under review, our joint venture with Rio Tinto Mining and
Exploration, exploring a total of 730 000 hectares in the Limpopo Province for
diamonds, progressed well, with some interesting new targets being identified.
The joint venture with Pan Palladium for
Platinum Group Metals in the northern limb of the bushveld has progressed to
drilling. Our joint venture agreement with Eurasia Mining & Exploration plc over
the Doornbosch platinum property in the eastern limb of the bushveld complex is
awaiting the issue of a prospecting permit to enable drilling to commence.
On 28 July 2003, Randgold announced a strategic empowerment partnership with
Phikoloso Mining (Pty) Ltd ("Phikoloso"). Randgold issued 8.8 million new
ordinary shares (16.4% of Randgold & Exploration"s enlarged issued share
capital) to Phikoloso in exchange for the total issued share capital and all the
shareholders claims on loan accounts against Viking Pony
Properties 359 (Pty) Ltd ("VPP"). VPP holds 0.2 million Anglo Platinum shares,
0.3 million Harmony Gold shares and 7.3 million Afrikander Lease shares, as well
as approximately 75% of Kabusha Mining and Finance, which holds 23 million
shares in Afrikander Lease. This transaction forms the foundation from which
Randgold & Exploration will drive the development of a new South African mining
company.
FINANCIAL REVIEW
The results for the six months ended 30 June 2003 have been prepared in terms of
South African statements of Generally Accepted Accounting Practice, and in
accordance with the Group"s accounting policies which are consistent with that
of the previous year.
As previously advised, the decrease in the Group"s holding in Randgold Resources
resulted in a change in accounting for the interest from a subsidiary to an
investment in associate. Therefore, there is no operating profit from mining
activities for the six months ending 30 June 2003 compared to R258 million for
the corresponding six months in 2002. The Group"s portion of the net profit from
Randgold Resources for the first six months ending 30 June 2003 amounted to
R126.5 million.
After corporate and exploration costs, depreciation charges, interest paid,
income from associate and minority interest, the Group"s net income for the six
months ending 30 June 2003 was R200.6 million (six months ending 30 June 2002:
R45 million). The increase in profitability is largely due to an improved
performance at Morila, a higher gold price and profits from the sale of a
portion of the Group"s holding in Randgold Resources.
The interest expense for the first six months of 2003, amounting to R5.7
million, is substantially lower than the same period in 2002 due to lower debt
levels. Depreciation and amortisation, as well as exploration and corporate
expenditure are materially lower than the previous year due to the exclusion of
the Randgold Resources costs from these line items.
The profit on the sale of investments relates primarily to the sale of 1 million
shares in Randgold Resources during June 2003. Portions of the investments in
JCI, JCI Debentures and Western Areas have also been disposed of during the six
month period.
The consolidated balance sheet reflects a continuous improvement in the group"s
financial health over the last six months, with a significant increase in cash,
as well as a reduction in debt.
PROSPECTS
Randgold & Exploration is re-establishing itself as an active corporation and to
this end intends to focus on new mining opportunities, both internally generated
and with the aim of participating in the transformation taking place in the
South African mining industry. The Group"s pursuit of new growth opportunities
will include our ongoing joint venture and exploration activities, due diligence
reviews, together with the prospects that our empowerment partnership will
provide.
R A R Kebble
Chairman
Johannesburg
12 August 2003
Registered office :
5 Press Avenue, Selby, 2025, Johannesburg, PO Box 82291, Southdale, 2135,
Republic of South Africa, Telephone +27(11) 309-6000, Telefax: +27(11) 837-2396,
e-mail : haddond@randgold.co.za
Share transfer secretaries :
Computershare Limited, 70 Marshall Street, Johannesburg, 2001, P.O Box 61051,
Marshalltown, 2107, Republic of South Africa, Telephone : 27(11) 370-7700,
Telefax +27(11) 834-2446
Depository bank :
American Depository Receipts, The Bank of New York, Shareholder Relations
Department, 101 Barclay Street, New York, NY 10286, Telephone: 1 (800) 524-4458
Investor and media relations :
For further information contact Kathy du Plessis on Telephone +27(11) 728-4701,
Telefax +27(11) 728-2547, e-mail : randgold@dpapr.com
Website : www.randgold.co.za
DISCLAIMER:
Certain of the statements in this document are forward-looking in nature and are
based on certain assumptions which involve risks and uncertainty because they
relate to events and depend on circumstances that will occur in the future.
Randgold & Exploration undertakes no obligation to update any forward-looking
statements. Mining and exploration by its very nature, is a risky business and
one in which the producers have little influence over the price of their
product. Consequently investors should be mindful of the inherent risks
associated with all mineral development projects.
Sponsor
HSBC
Date: 12/08/2003 12:46:18 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
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