LONDON (Alliance News) - Berkeley Mineral Resources PLC Tuesday said its pretax loss widened in its last financial year and revealed the outcome of an investigation into the way some of the assets on its balance sheet were classified and valued, but Chairman Alex Borrelli said that he is confident about the company's future prospects.
The company said it made a GBP9.3 million pretax loss in the year ended June 30, 2014, compared with a GBP2.6 million pretax loss in the prior financial year. It recorded no revenue in either of the two financial years. Administrative expenses rose to GBP3.0 million from GBP1.5 million.
Impairment charges for writedowns and provisions rose to GBP4.6 million from GBP984,307. Share based payments increased to GBP1.7 million from GBP113,718.
"While I have serious reservations over the previous actions taken, and financial control exercised, by the company, I am confident that the company has an effective asset base of significant potential value through its tailings at Kabwe and which I intend to process for the realisation of zinc and lead concentrates in order to generate revenues for the benefit of our shareholders," said Borrelli, who became chairman in November 2014.
Although Borrelli identified "significant value" in the washplant and leachplant tailings at Kabwe in Zambia, he said that the acquisitions of its copper interests in Zambia are of "minimal value" and that they were accounted for at "significant cost" to the company. The balances of the copper interests acquired in Zambia have been written off, the chairman said.
"Management time will now be largely focused on the establishment of a suitable processing plant at Kabwe and on the production of a saleable zinc/lead concentrate from the washplant and leachplant tailings. An announcement on the timing for the start of production will only be made once our plans are finalised," Borrelli added.
In February the company had said that results for the year to the end of June 2014 would include write downs of assets in the range of GBP10 million to GBP12 million.
"The actual level of write downs and provisions before depreciation and foreign exchange differences amounts to GBP10.296 million, of which GBP4.029 million has been treated as prior year adjustments resulting in the re-statement of consolidated net assets at 30 June 2013 and 30 June 2012. GBP6.267 million has been written down against the audited consolidated net assets of the Group at 30 June 2014, the resulting balance of which amounts to GBP8.087 million," Borrelli said.
The group, which wants to change its name to BMR Mining PLC, also said that it wants to implement a share reorganisation "to reduce the par value of the shares in order that any new equity funds can be raised by the company in due course as the market price on the commencement of trading when the suspension is lifted is likely to be below the par value; and a limited share consolidation to restore the likely market price to a level above one pence per share".
Trading in the company's shares is currently suspended. The company expects the suspension to be lifted once it reports interim results later in April.
By Samuel Agini; samagini@alliancenews.com; @samuelagini
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