Last checked at 10 Sep 2008 07:00
BEOWULF MINING PLC News Release CHAIRMAN'S STATEMENT FOR THE 6 MONTHS TO JUNE 2008
The Board of Beowulf Mining PLC ('Beowulf') is pleased to report the interim results to 30 June 2008. The results show that Beowulf made a loss of ‚£203,074 in the first 6 months of 2008 as compared to a loss of ‚£192,170 in the first 6 months of 2007.
With the emergence and effects of the "credit crunch" in 2007 and 2008 the directors of Beowulf decided that the best way to expand its exploration activities without excessively utilising capital was to seek joint venture partners on its five exploration projects in Sweden. As a result joint venture partners are already in place to continue exploration on three of these projects and discussions with potential joint venture partners are ongoing in relation to the remaining two areas. Appropriate partners also provide Beowulf with access to additional technical personnel.
Beowulf's shares started trading on the Swedish Aktietorget stock market ( www.aktietorget.se) in August 2008 under the symbol BEO. The shares are traded in Swedish Krona on this market.
Beowulf's lead project in Sweden is the Ruoutevare Magnetite Project. The project obtained WAG Limited as a joint venture partner, who will earn a 50% interest in the project by spending AUD$1,000,000 on a 3,000 - 5,000 metre delineation drilling program and, metallurgical test work. The project has obtained an initial 140 million tonne JORC Resource from the geological consultant Runge Limited, grading 39.1% iron, 5.7% titanium and 0.2% vanadium. A diamond drilling program is expected to begin in November 2008 to target extensions to the known mineralization, which Runge Limited suggested extend beyond the presently drilled area.
WAG Limited has also become the joint venture partner of Beowulf's Kallak Magnetite Project. They will earn a 50% interest in the project by completing drilling, metallurgical test work and a magnetic survey. The Geological Survey of Sweden (SGU) conducted exploration on the area and based on three diamond drill holes and geophysical surveys have estimated a target iron ore tonnage of 88-92 million tonnes at 38-42% iron. Beowulf anticipates that the drilling program will commence shortly after the conclusion of the Ruoutevare drilling program scheduled for November 2008.
The increase demand for iron ore from China and India and the rise in price of iron make Ruoutevare and Kallak commercially attractive properties.
Beowulf is awaiting a JORC classification of its Lulepotten copper gold deposit on its Ballek Project. Agricola Resources PLC ("Agricola") has signed an option and earn-in agreement with Beowulf on the Ballek project and is earning a 51% interest by undertaking ground geophysical surveys followed by 3,200 metres of diamond drilling by June 30, 2009. To date Agricola has completed the ground geophysical surveys and 1,617 metres of diamond drilling. Agricola's interest can be increased from 51% to 70% through funding a further USD $500,000 of exploration expenditure.
Joint venture partners are being sought for the Grundtrask gold project and Jokkmokk copper gold project. Discussions with potential partners are ongoing.
Beowulf has applied for extra exploration permits around the Ruoutevare, Kallak and Jokkmokk project areas.
The Company strategy is to continue exploration and analysis work on all of the Beowulf properties in order to prove up their resource base and commercial worth.
Dr Robert YoungChairmanBeowulf Mining PLCSeptember 2008INCOME STATEMENTFOR THE 6 MONTHS ENDED 30 JUNE 2008 (Unaudited) (Unaudited) (Audited) 6 months to 6 months to Year ended 30 June 2008 30 June 2007 31 Dec 2007 ‚£ ‚£ ‚£CONTINUING OPERATIONSRevenue - - -Other operating income - 150 150Administrative expenses (210,462) (198,662) (378,775)OPERATING LOSS (210,462) (198,512) (378,625)Finance costs (5,000) - (4,167)Finance income 12,388 6,342 20,154LOSS BEFORE TAX (203,074) (192,170) (362,638)Tax - - -LOSS FOR THE PERIOD (203,074) (192,170) (362,638)Basic loss per share (0.26p) (0.28p) (0.52p)Diluted loss per share (0.24p) (0.23p) (0.42p)STATEMENT OF RECOGNISED INCOME AND EXPENSEFOR THE 6 MONTHS ENDED 30 JUNE 2008 (Unaudited) (Unaudited) (Audited) 6 months to 6 months to Year ended 30 June 2008 30 June 2007 31 Dec 2007 ‚£ ‚£ ‚£Revaluation of investments (17,869) (30,326) 68,319NET (EXPENSE)/ INCOME RECOGNISEDDIRECTLY IN EQUITY (17,869) (30,326) 68,319LOSS FOR THE PERIOD (203,074) (192,170) (362,638)TOTAL RECOGNISED INCOME/(EXPENSE) FOR THE PERIOD (220,943) (222,496) (294,319)BALANCE SHEETAS AT 30 JUNE 2008 (Unaudited) (Unaudited) (Audited) 6 months to 6 months to Year ended 30 June 2008 30 June 2007 31 Dec 2007 ‚£ ‚£ ‚£ASSETSNON-CURRENT ASSETSIntangible assets 237,058 258,586 240,943Property, plant and equipment 1,681 1,837 1,920Investments 247,529 265,398 295,724 486,268 525,821 538,587CURRENT ASSETSTrade and other receivables 30,760 48,338 34,426Cash and cash equivalents 561,490 236,067 671,231 592,250 284,405 705,657LIABILITIESCURRENT LIABILITIESTrade and other payables (37,102) (13,987) (20,410)NET CURRENT ASSETS 555,148 270,418 685,247NON-CURRENT LIABILITIESFinancial liabilities - borrowingsInterest bearing loans and borrowings (250,000) - (250,000)NET ASSETS 791,416 796,239 973,834SHAREHOLDERS' EQUITYCalled up share capital 808,982 663,982 745,482Share premium 2,597,191 2,361,482 2,597,719Share scheme reserve 5,879 - -Revaluation reserve 142,529 160,398 190,724Capital contribution reserve 46,451 46,451 46,451Retained earnings (2,809,616) (2,436,074) (2,606,542)TOTAL EQUITY 791,416 796,239 973,834CASHFLOW STATEMENTFOR THE 6 MONTHS ENDED 30 JUNE 2008 (Unaudited) (Unaudited) (Audited) 6 months to 6 months to Year ended 30 June 2008 30 June 2007 31 Dec 2007 Notes ‚£ ‚£ ‚£Cash flows from operating activitiesCash generated from operations 1 (138,726) (191,690) (318,319)Net cash from operating activities (138,726) (191,690) (318,319)Cash flows from investing activitiesPurchase of intangible fixed assets (46,904) (74,238) (93,534)Purchase if tangible fixed assets - - (460)Purchase of fixed asset investments - - -Interest received 12,388 6,342 20,154Net cash from investing activities (34,516) (67,896) (73,840)Cash flows from financing activitiesNew loans in period - - 250,000Share issue 63,500 - 341,500Cost of share issue - - (23,763)Net cash from financing activities 63,500 - 567,737(Decrease)/Increase in cashand cash equivalents (109,742) (259,586) 175,578Cash and cash equivalents at the beginningof period 2 671,231 495,653 495,653Cash and cash equivalents at end of period 561,489 236,067 671,231NOTES TO THE CASH FLOW STATEMENTFOR THE 6 MONTHS ENDED 30 JUNE 2008
1. RECONCILIATION OF LOSS BEFORE TAX TO CASH GENERATED FROM OPERATIONS
(Unaudited) (Unaudited) Audited) 6 months to 6 months to Year ended 30 June 2008 30 June 2007 31 Dec 2007 ‚£ ‚£ ‚£Loss before tax (203,074) (192,170) (362,638)Depreciation charges 239 263 640Amortisation of exploration costs 50,788 48,547 85,485Equity-settled share-based payment transactions 5,351 - -Finance costs 5,000 - 4,167Finance income (12,388) (6,342) (20,154) (154,084) (149,702) (292,500)Decrease/(Increase) in trade andother receivables 3,666 (30,990) (17,078)Increase/(Decrease) in trade andother payables 11,692 (10,998) (8,741)Cash generated from operations (138,726) (191,690) (318,319)
2. CASH AND CASH EQUIVALENTS
The amounts disclosed on the cash flow statement in respect of cash and cash equivalents are in respect of these balance sheet amounts:
Period ended 30 June 2008 30 June 2008 1 Jan 2008 ‚£ ‚£Cash and cash equivalents 561,489 671,231Period ended 30 June 2007 30 June 2007 1 Jan 2007 ‚£ ‚£Cash and cash equivalents 236,067 495,653Year ended 31 December 2007 31 Dec 2007 1 Jan 2007 ‚£ ‚£Cash and cash equivalents 671,231 495,653
Cash and cash equivalents consist of cash in hand and balances with banks.
NOTES TO THE FINANCIAL STATEMENTS UNAUDITED RESULTS FOR THE 6 MONTHS ENDED 30 JUNE 2008
1. INFORMATION
The interim financial statements for the six month period ended 30 June 2008 have been prepared in accordance with IAS 34 "Interim Financial Reporting". The disclosed figures are not statutory accounts in terms of section 240 of the Companies Act 1985. Statutory accounts for the year ended 31 December 2007, on which the auditors gave an unqualified report, have been filed with Registrar of Companies.
This Interim Report has been prepared on a basis consistent with the accounting policies expected to be applied for the year ending 31 December 2008, and which are also consistent with the accounting policies applied for the year ended 31 December 2007 except for the adoption of new standards and interpretations.
2. ACCOUNTING POLICIES
Reporting entity
Beowulf Mining plc is a company domiciled in United Kingdom. The address of the Company's registered office is 1 Green Hill, Little Thetford, Ely, Cambridgeshire, CB7 3HD. The Company primarily is involved in the exploration of copper and gold deposits.
Compliance with accounting standards
These financial statements have been prepared in accordance with International Financial Reporting Standards and IFRIC interpretations and with those parts of the Companies Act 1985 applicable to companies reporting under IFRS.
The financial statements have been prepared under the historical cost convention.
Intangible fixed assets - exploration costs
Expenditure on the acquisition costs, exploration and evaluation of interests in licences including related overheads are capitalised. Such costs are carried forward in the balance sheet under intangible assets and amortised over the maximum period of the licences in respect of each area of interest where:
a) such costs are expected to be recouped through successful development and exploration of the area of interest or alternatively by its sale;
b) exploration activities have not yet reached a stage that permits a reasonable assessment of the existence or otherwise of economically recoverable reserves and active operations in relation to the areas are continuing.
An annual impairment review is carried out by the directors to consider whether any exploration or development costs have suffered impairment in value and whether necessary provisions are made accordingly.
Accumulated costs in respect of areas of interest that have been abandoned are written off to the profit and loss account in the year in which the area is abandoned.
Exploration costs are carried at the lower of cost and net realisable value.
Property, plant and equipment
Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.
Plant and machinery - 25% on reducing balance
Investments
Fixed asset investments are stated at open market value. The revaluation adjustment is taken to the revaluation reserve.
Taxation
Current taxes are based on the results shown in the financial statements and are calculated according to local tax rules, using tax rates enacted or substantially enacted by the balance sheet date.
Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.
Foreign currencies
Assets and liabilities in foreign currencies are translated into sterling at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies are translated into sterling at the rate of exchange ruling at the date of transaction. Exchange differences are taken into account in arriving at the operating result.
Share-based payment transactions
Where equity settled share options are awarded to employees, the fair value of the options at the date of grant is charged to the income statement over the vesting period. Non-market vesting conditions are taken into account by adjusting the number of equity instruments expected to vest at each balance sheet date so that, ultimately, the cumulative amount recognised over the vesting period is based on the number of options that eventually vest. Market vesting conditions are factored into the fair value of all options granted. As long as all other vesting conditions are satisfied, a charge is made irrespective of whether market vesting conditions are satisfied. The cumulative expense is not adjusted for failure to achieve a market vesting condition.
Where terms and conditions of options are modified before they vest, the increase in the fair value of the options, measured immediately before and after the modification, is also charged to the income statement over the remaining vesting period.
Where equity instruments are granted to persons other than employees, the income statement or share premium account if appropriate, are charged with the fair value of goods and services received.
3. EARNINGS PER SHARE
Basic earnings per share is calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of ordinary shares of 77,479,016 (30 June 2007 - 69,398,247 and 31 December 2007 - 69,466,329) outstanding during the period.
Diluted earnings per share is calculated using the weighted average number of shares of 85,100,445 (30 June 2007 - 83,098,247 and 31 December 2007 - 86,173,497) adjusted to assume the conversion of all dilutive potential ordinary shares.
Contact:
Dr. Robert Young, Chairman, Beowulf Mining Plc+44 (0)1353 649 701Gavin Burnell, Ruegg & Co Limited+44 (0)207 584 3663
David Scott / Nick Bealer, Alexander David Securities Limited +44 (0)207 448 9820
Gary Middleton, St. Swithins PR Ltd07951 603 289
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