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GDH
GDH
GDH - Good Hope - Interim results for the six months ended 31 december 2006
Good Hope Diamonds (Kimberley) Limited
(Registration number 1983/013789/06)
Share Code: GDH ISIN: ZAE000050381
("Good Hope" or "the company")
INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2006
Consolidated Income Statement
6 Months 6 Months Year ended
ended ended 30 June
31 Dec. 31 Dec. 2006
2006 2005 (audited)
(reviewed) (reviewed) R`000
R`000 R`000
Revenue 47 0 86
Operating loss 2482 2946 5004
Depreciation 559 573 1235
Net interest paid 766 1002 1845
Attributable loss 3807 4521 8084
Number of shares in issue 122000 122000 122000
Headline loss per share
(cents) 3.12 3.71 6.63
Loss per share (cents) 3.12 3.71 6.63
Reconciliation between loss
and headline loss
Attributable loss 3807 4521 8084
Profit on fair valuation of
listed shares 0 0 5
Headline loss 3807 4521 8089
Consolidated Balance Sheet
31 Dec. 31 Dec. 30 June
2006 2005 2006
(reviewed) (reviewed) (audited)
R`000 R`000 R`000
Assets
Non-current assets 98867 96420 100379
Property, plant and equipment 74940 71904 75499
Goodwill 22292 22292 22292
Investments 1635 1732 2588
Current assets 2915 10267 3264
Operating assets 2723 10236 3158
Cash and cash equivalents 192 31 106
Total Assets 101782 106687 103643
Equity and Liabilities
Capital and reserves 66330 73700 70137
Share capital and premium 125955 125955 125955
Non-distributable reserves 0 8276 0
Accumulated loss (59625) (52255) (55818)
Non-current liabilities
Interest bearing borrowings 23026 20346 22068
Current liabilities 12426 12641 11438
Operating liabilities 1709 3149 1529
Interest bearing liabilities 10717 9492 9909
Total Equity and Liabilities 101782 106687 103643
Net asset value per share
(cents) 54.37 60.41 57.49
Statement of Changes in Equity
6 Months 6 Months Year ended
ended ended 30 June
31 Dec. 31 Dec. 2006
2006 2005 (audited)
(reviewed) (reviewed) R`000
R`000 R`000
Balance at beginning of period 70137 88725 88725
Net loss for the period (3807) (4521) 8084)
Balance at end of period 66330 73700 70137
Consolidated Cash Flow Statement
6 Months 6 Months Year ended
ended ended 30 June
31 Dec. 31 Dec. 2006
2006 2005 (audited)
(reviewed) (reviewed) R`000
R`000 R`000
Cash flow from operating
activities (1867) (7629) (4234)
Net interest paid (766) (1002) (1845)
(2633) (8631) (6079)
Cash flow from investing
activities 953 (39) 4655
Cash flow from financing
activities 971 9330 11763
Net (decrease)/increase in
cash and cash equivalents (709) 660 (1029)
Cash and cash equivalents at
beginning of period (9092) (10121) (10121)
Cash and cash equivalents at
end of period (9801) (9461) (9092)
Commentary
After upgrading the Loxton Dal mine during 2004 and 2005, the group only
recommenced underground mining at the mine during the 2006 financial year.
However, due to the legal disputes with the previous vendor of the mines over
the ownership of a loan account in a subsidiary, and the non-fulfilment of
certain issues by the previous vendor, the group gave the opposing legal counsel
an undertaking not to dispose of any assets and diamonds. As a result, no sales
of rough diamonds have taken place during the period under review. The group
continues to obtain legal advice to consider the revocation of the undertaking
and the ultimate resolution of the disputes. In order to safeguard shareholders,
in May 2006, the company voluntarily suspended trade of the company`s share on
the JSE Limited.
With the mining licence at Loxton Dal expiring during 2007, the group has made
the necessary application to the Department of Minerals and Energy ("DME") to
convert the old order mining right to conform with current legislation. As
previously stated, the company acquired the Frank Smith mine without a valid
mining licence, and, as a result, no mining operations are allowed to take place
at this mine until a new licence is approved by the DME. This approval will only
be forthcoming once the Frank Smith mine has a Black Economic Empowerment
("BEE") partner in place. Negotiations with a BEE group are currently in
progress, and the group expects to finalise these negotiations in the near
future.
With the inability of the mines to sell any diamonds in terms of the
abovementioned undertaking, and the lack of a mining licence at the Frank Smith
mine, the necessary funding of the mines continues to be provided by the El
Shaddai Trust, a trust controlled by a shareholder and director of the company.
The funding, and any future funding, has been secured by the trust registering
mortgage and notarial bonds over the properties and equipment owned by the
Loxton Dal and Frank Smith mines.
Management remains confident that the legal disputes will be resolved in the
near future which will then allow the group to finalise a BEE partner, thus,
allowing the DME to approve the mining licence at Frank Smith. With the
resolution of these issues, the mines should come into full production and hence
become self-funding.
Dividend
No dividend has been declared nor is one recommended in respect of the financial
period under review.
Accounting Policies and Review
The accounting policies comply with International Financial Reporting Standards,
and have been consistently applied.
The financial information set out above has been reviewed, but not audited, by
the group`s auditors, Ashton Chartered Accountants Inc. The review report is
available for inspection at the registered office of the company.
On behalf of the board of directors
G Schauder
Company Secretary
Hyde Park
27 March 2006
Directors
E Cambouris (Managing), G Schauder (Financial), J Kossowsky+*, Y Kossowsky+*, FA
Pieterse*
+ American
* Non-executive
Registered office
38 Lebombo Street, Ashlea Gardens, 0181
Date: 27/03/2007 17:29:01 Produced by the JSE SENS Department.
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