Last checked at 23 Dec 2008 07:00
23 December 2008
Highlights
Commenting today Gerry Nealon, Executive Chairman of the Company said: "Bezant's core Mankayan Project is well on its way to firming up an indicated resource with the potential to generate a world class mine when compared to its peers, situated in the area of Luzon in the northern Philippines. These peers serve to clearly demonstrate the will, stability, port access and infrastructure that exists to support further major mining developments in the Philippines. We look forward to announcing results from the drilling early in 2009.
For further information, please contact:
Gerry Nealon
Executive Chairman, Bezant Resources Plc
Tel: +61 41 754 1873
Bernard Olivier
Executive Director, Bezant Resources Plc
Tel: +61 40 894 8182
James Harris / Matthew Chandler
Strand Partners Limited
Tel: +44 (0) 20 7409 3494
Laurence Read
Threadneedle Communications (UK)
Email: Laurence.Read@threadneedlepr.co.uk
Tel: +44 (0)20 7936 9696
Mob: +44 (0)7979 955 923
or visit http://www.bezantresources.com
Chairman's Statement :
It is with pleasure that I am able to report to our shareholders upon the further progress made by the Company during the last financial year. In short, this relates to a strong cash position and the excellent work of our on-site team in the Philippines, which continues to firm up on the potential of our flagship "Mankayan Project" as a world class copper-gold deposit. I firmly believe that the Company's recent poor share price performance fails to reflect our aforementioned progress, with investor sentiment largely being driven by the political and financial market turmoil that has emanated from the well documented US sub-prime banking crisis and which has given rise to almost unprecedented volatility in the world's major stock markets.
The Board has always sought to apply the Company's core skill sets of evaluation, analysis and understanding of mineralisation to world class projects with strong potential to increase shareholder value. Accordingly, the Company carefully assessed the capability of many different locations for hosting copper-gold resources of well over 100 million tonnes, before acquiring the Mankayan Project in the Philippines in July 2007 with historical drilling data indicating a resource in the order of 166 million tonnes, relating to 1.9 billion pounds of contained copper and 2.9 million ounces of gold. In July 2008, the Company announced the outcome of its digitisation of this historic data, with Snowden Mining Industry Consultants Pty. Limited ("Snowden") confirming a JORC compliant Inferred Resource at a 0.4 per cent. copper cut-off of approximately 277.7 million tonnes grading at 0.50% copper and 0.42 g/t gold. This independent resource estimate serves to support the Company's belief that the Mankayan Project represents a world-class deposit, containing approximately 3.06 billion pounds (1.39 million tonnes) of copper and 3.8 million ounces of gold within the Inferred Resource. Our on-site team is currently completing the seventh and eighth holes in our 11,000 metre (ten hole) drilling programme, that commenced in September 2007 and Snowden have commented that they are confident that the Company should be in a position to upgrade various areas of the deposit to an Indicated Resource as a result of this ongoing work and further consolidation of the historical data, in early 2009.
During November 2007, the Company announced that its wholly owned subsidiary, Anglo Tanzania Gold Limited, had completed its 46 per cent. earn-in in respect of the "Mkurumu Project" in Tanzania, with Anglo Gold Ashanti retaining a similar 46 per cent. and the remaining 8 per cent. being held by indigenous Tanzanian locals. In May 2008, the Company announced the signing of a memorandum of understanding to further expand upon its gold exploration activities in Tanzania, relating to the acquisition of a 50 per cent. interest in certain tenements via a two year earn-in arrangement. The package consists of 9 highly prospective tenements together with Prospecting Licences covering, in aggregate, some 2,116 square kilometres and an additional 3 applications for either new licences or renewals, covering approximately a further 455 square kilometres. First pass reconnaissance work to date, including satellite imagery and airborne geophysical surveys, has identified several drainage channels that contained free gold. Systematic heavy mineral drainage and rock sampling work is currently underway at the tenements and I look forward to announcing further news throughout 2009. In light of the Company's relatively strong cash position, we are well positioned to continue with our intended work programmes, leading to the completion of our current mining feasibility studies in the Philippines and the flexibility to continue with our exploration studies in Tanzania respectively.
As a consequence of exploration activities during the period, the Company incurred a consolidated loss after tax (but before impaired investments expensed) for the financial year ended 30 June 2008 of £910,000. Impaired investments expensed totalled £5,985,000 for the year.
A number of Board changes were effected throughout the reporting period, primarily in line with the Company's re-positioning to implement a more aggressive exploration programme in the Philippines. It was a pleasure to announce the appointment of Mr. Ronnie Siapno and Dr. Evan Kirby, both of whom have considerable experience throughout the mining industry. Mr. Clive Sinclair-Poulton, Ms. Melissa Sturgess and Mr. Mark Burchnall stepped down from the Board to pursue their other work commitments and the Company acknowledges their significant contributions towards its successful transition from being an investment company, to that of a fully funded copper-gold exploration / development company.
Mr. Tony Hopkins also retired from the Board towards the end of last year and it was with the deepest regret that we learned of his passing following continued ill health, during February of this year. Tony was almost an institution throughout the world of Geology, particularly in relation to that of Africa and specifically that of Tanzania. He will be sadly missed and our sympathies go out to his wife and family.
In closing, I wish to return to the matter of our recent share price performance, against a back-drop of unprecedented turmoil in global financial markets. A number of market commentators have suggested that the supply of resource commodities will be far more severely curtailed than demand growth, whereby China and India may continue to grow during a period when new copper and gold mines are not being brought into production sufficiently fast enough, to meet such continued expansion. I cannot offer any panacea to the global financial crisis, but can re-iterate that the Company has excellent ongoing projects that are fully funded. The core "Mankayan Project" is well on its way to firming up a resource with the potential to generate a world class mine, when compared to its peers in the area throughout Luzon in the northern Philippines. These peers serve to clearly demonstrate the will, stability, port access and infrastructure that exists to support further major mining developments in the Philippines.
Most recently, the Board was pleased to announce the appointment of Matrix Corporate Capital LLP as sole Broker to the Company. Working with Matrix, I remain sincerely optimistic with regards to our ability to attract more positive investor sentiment towards the Company and look forward to announcing further significant results and developments from our Mankayan Project in the year ahead.
Gerard A Nealon
Executive Chairman
Consolidated income statement
For the year ended 30 June 2008
| | | | 2008 | 2007 |
| | Notes | | £’000 | £’000 |
| | | | | (as restated) |
| | | | | |
| Consolidated turnover | | | - | - |
| | | | | |
| Cost of sales | | | - | - |
| | | | | |
| Gross profit | | | - | - |
| | | | | |
| Administrative expenses | 3 | | (1,090) | (551) |
| Impairment expenses | 4 | | (5,985) | - |
| | | | | |
| Consolidated operating loss | 5 | | (7,075) | (551) |
| | | | | |
| Interest receivable | 6 | | 180 | 34 |
| Interest payable | 7 | | - | - |
| | | | | |
| Loss on ordinary activities before taxation | | | (6,895) | (517) |
| | | | | |
| Taxation | 8 | | - | - |
| | | | | |
| Loss on ordinary activities after taxation | | | (6,895) | (517) |
| | | | | |
| Loss for the period | | | (6,895) | (517) |
| | | | | |
| | | | | |
| Loss per share - pence | | | | |
| Basic | 9 | | (18.66p) | (2.50p) |
| | | | | |
| Diluted | 9 | | (18.69p) | (2.66p) |
Statement of changes in equity
For the year ended 30 June 2008
| | Share Capital £’000 | Share Premium £’000 | Other Reserves £’000 | Accumulated Losses £’000 | Total Equity £’000 |
| | | | | | |
| Consolidated | | | | | |
| | | | | | |
| Balance at 1 July 2007 | 987 | 10,576 | 686 | (5,603) | 6,646 |
| Share issues | 29 | 11,742 | - | - | 11,771 |
| Share issue costs | - | (414) | - | - | (414) |
| Reversal of placement funds received in advance | - | - | (665) | - | (665) |
| Cost of share-based payments | - | - | 136 | - | 136 |
| Current year loss | - | - | - | (6,895) | (6,895) |
| Foreign currency reserve | - | - | 8 | - | 8 |
| | | | | | |
| Balance at 30 June 2008 | 1,016 | 21,904 | 165 | (12,498) | 10,587 |
| Consolidated | | | | | |
| | | | | | |
| Balance at 1 July 2006 | 958 | 4,180 | - | (5,086) | 52 |
| Share issues | 29 | 7,032 | - | - | 7,061 |
| Share issue costs | - | (636) | - | - | (636) |
| Cost of share-based payments | - | - | 6 | - | 6 |
| Placement funds received in advance | - | - | 665 | - | 665 |
| Current year loss | - | - | - | (517) | (517) |
| Foreign currency reserve | - | - | 15 | - | 15 |
| | | | | | |
| Balance at 30 June 2007 | 987 | 10,576 | 686 | (5,603) | 6,646 |
Statement of changes in equity
For the year ended 30 June 2008
| Share Capital £'000 | Share Premium £'000 | Other Reserves £'000 | Accumulated Losses £'000 | Total Equity £'000 | |
| Company Balance at 1 July 2007 | 987 | 10,576 | 671 | (5,515) | 6,719 |
| Share issues | 29 | 11,742 | - | - | 11,771 |
| Share issue costs | - | (414) | - | - | (414) |
| Reversal of placement funds received in advance | - | - | (665) | - | (665) |
| Cost of share-based payments | - | - | 136 | - | 136 |
| Current year loss | - | - | - | (6,912) | (6,912) |
| Foreign currency reserve | - | - | - | - | - |
| Balance at 30 June 2008 | 1,016 | 21,904 | 142 | (12,427) | 10,635 |
| Company | |||||
| Balance at 1 July 2006 | 958 | 4,180 | - | (5,086) | 52 |
| Share issues | 29 | 7,032 | - | - | 7,061 |
| Share issue costs | - | (636) | - | - | (636) |
| Cost of share-based payments | - | - | 6 | - | 6 |
| Placement funds received in advance | - | - | 665 | - | 665 |
| Current year loss | - | - | - | (429) | (429) |
| Foreign currency reserve | - | - | - | - | - |
| Balance at 30 June 2007 | 987 | 10,576 | 671 | (5,515) | 6,719 |
Balance sheet
As at 30 June 2008
| | | | Consolidated | Company | ||
| | | | | | | |
| | | | 2008 | 2007 | 2008 | 2007 |
| | Notes | | £’000 | £’000 | £’000 | £’000 |
| | | | | (as restated) | | |
| | | | | | | |
| ASSETS | | | | | | |
| Current assets | | | | | | |
| Trade and other receivables | 13 | | 7 | 196 | 7 | 191 |
| Cash at bank and in hand | | | 3,713 | 1,625 | 3,673 | 1,616 |
| Total current assets | | | 3,720 | 1,821 | 3,680 | 1,807 |
| Non-current assets | | | | | | |
| Intangible assets - goodwill | 14 | | - | 4,500 | - | - |
| Plant and equipment | 15 | | 32 | 4 | 29 | 3 |
| Investment in subsidiary | 16 | | - | - | - | 4,500 |
| Investments | 16 | | 6,846 | 458 | 6,889 | 475 |
| Deferred exploration and evaluation costs | 17 | | 149 | - | 149 | - |
| Total non-current assets | | | 7,027 | 4,962 | 7,067 | 4,978 |
| | | | | | | |
| TOTAL ASSETS | | | 10,747 | 6,783 | 10,747 | 6,785 |
| | | | | | | |
| LIABILITIES | | | | | | |
| | | | | | | |
| Current liabilities | | | | | | |
| Trade and other payables | 18 | | 160 | 137 | 112 | 66 |
| Total current liabilities | | | 160 | 137 | 112 | 66 |
| | | | | | | |
| NET ASSETS | | | 10,587 | 6,646 | 10,635 | 6,719 |
| | | | | | | |
| CAPITAL AND RESERVES | | | | | | |
| Called up share capital | 20 | | 1,016 | 987 | 1,016 | 987 |
| Share premium account | 20 | | 21,904 | 10,576 | 21,904 | 10,576 |
| Share based payment reserve | 22 | | 142 | 6 | 142 | 6 |
| Other reserves | 22 | | 23 | 680 | - | 665 |
| Accumulated losses | 22 | | (12,498) | (5,603) | (12,427) | (5,515) |
| | | | | | | |
| TOTAL EQUITY | | | 10,587 | 6,646 | 10,635 | 6,719 |
Cash flow statement
For the year ended 30 June 2008
| | | | Consolidated | Company | ||
| | | | | | | |
| | | | 2008 | 2007 | 2008 | 2007 |
| | Notes | | £’000 | £’000 | £’000 | £’000 |
| | | | | | | |
| Net cash outflow from operating activities | 24 | | (974) | (505) | (890) | (483) |
| | | | | | | |
| Cash flows from investing activities | | | | | | |
| Interest received | | | 180 | 34 | 179 | 34 |
| Other income | | | 73 | - | 73 | - |
| Payments for plant and equipment | | | (32) | (5) | (29) | (4) |
| Payments to fund exploration | | | (149) | (458) | (149) | - |
| Payments to acquire investment in associate | | | (500) | - | (500) | - |
| Loans to associates and subsidiaries | | | (605) | - | (748) | (475) |
| Payments to acquire available-for-sale investments | | | (200) | - | (200) | - |
| Payments for joint venture expenditure | | | (35) | - | - | - |
| Net cash outflow from investing activities | | | (1,268) | (429) | (1,374) | (445) |
| | | | | | | |
| Cash flows from financing activities | | | | | | |
| Cash proceeds from issue of shares | | | 4,335 | 2,561 | 4,335 | 2,561 |
| Placement funds received in advance | | | - | 665 | - | 665 |
| Share issue costs | | | (26) | (688) | (26) | (688) |
| | | | 4,309 | 2,538 | 4,309 | 2,538 |
| Increase/(Decrease) in cash | | | 2,067 | 1,604 | 2,045 | 1,610 |
| | | | | | | |
| Cash and cash equivalents at beginning of year | | | 1,625 | 3 | 1,616 | 3 |
| Foreign exchange movement | | | 21 | 18 | 12 | 3 |
| | | | | | | |
| Cash and cash equivalents at end of year | | | 3,713 | 1,625 | 3,673 | 1,616 |
NOTES TO THE FINANCIAL INFORMATION
FOR THE YEAR ENDED 30 JUNE 2008
| 1. | Basis of preparation |
| The financial information, which incorporates the financial information of the Company and its subsidiary undertakings (the "Group"), has been prepared using the historical cost convention and in accordance with the International Financial Reporting Standards ("IFRS") including IFRS 6 'Exploration for and Evaluation of Mineral Resources', as adopted by the European Union ("EU") for the first time. | |
| The financial information contained in this announcement does not constitute full statutory accounts within the meaning of Section 240 of the Companies Act 1985. The figures are extracted from the audited full financial statements for the year ended 30 June 2008 which will be filed with the Registrar of Companies. |
| 2. | Loss per share |
| The basic and diluted loss per share have been calculated using the loss for the 12 months ended 30 June 2008 of £6,895,000 (2007: £517,000). The basic loss per share was calculated using a weighted average number of shares in issue of 36,944,824 (2007: 20,714,489). The diluted loss per share has been calculated using an additional weighted average number of shares in issue and to be issued of 36,890,621 (2007: 22,912,289). |
| 3. | Share capital | ||||
| | | ||||
| | Number | Class | Nominal value | Year ended 30 June 2008 | Year ended 30 June 2007 |
| | | | | £’000 | £’000 |
| | Authorised | | | | |
| | 690,432,500 | Ordinary | 0.2p | 1,381 | 1,381 |
| | 7,959,196 | Deferred | 4p | 319 | 319 |
| | 625,389 | Deferred | 99p | 619 | 619 |
| | | | | 2,319 | 2,319 |
| | | | | | |
| | Allotted, called up and fully paid | | | | |
| | 39,162,223 (2007: 24,524,345) | Ordinary | 0.2p | 78 | 49 |
| | 7,959,196 | Deferred | 4p | 319 | 319 |
| | 625,389 | Deferred | 99p | 619 | 619 |
| | | | | 1,016 | 987 |
| | | | | ||
| | | | Number of shares | ||
| | The movement in the share capital is summarised below: | | | ||
| | | | | ||
| | As at 1 July 2007 | | 24,524,345 | ||
| | | | | ||
| | 10 July 2007 – Acquisition shares issued | | 5,454,545 | ||
| | 10 July 2007 – Subscription shares issued | | 6,666,667 | ||
| | 10 July 2007 – Fee Shares issued for services rendered | | 516,666 | ||
| | 6 May 2008 – Acquisition shares issued | | 2,000,000 | ||
| | As at 30 June 2008 | | 39,162,223 | ||
| 4. | Statement of movement on reserves | ||||
| | | ||||
| | Group | Share-based payment reserve | Foreign exchange reserve | Other reserve – for own shares | Accumulated losses |
| | | £’000 | £’000 | £’000 | £’000 |
| | | | | | |
| | At 1 July 2007 | 6 | 15 | 665 | (5,603) |
| | Cost of share-based payments | 136 | - | - | - |
| | Shares issued | - | - | (665) | - |
| | Current year loss | - | - | - | (6,895) |
| | Currency translation differences on foreign operations | - | 8 | - | - |
| | | | | | |
| | At 30 June 2008 | 142 | 23 | - | (12,498) |
| 5. | Reconciliation of movements in shareholders’ funds | ||||
| | | ||||
| | | Consolidated | Company | ||
| | | 2008 | 2007 | 2008 | 2007 |
| | | £’000 | £’000 | £’000 | £’000 |
| | | | | | |
| | Loss for the period | (6,895) | (517) | (6,912) | (429) |
| | | | | | |
| | Shares issued less costs | 11,357 | 6,425 | 11,357 | 6,425 |
| | Placement funds received in advance | (665) | 665 | (665) | 665 |
| | Currency translation differences on foreign currency operations | 8 | 15 | - | - |
| | Cost of share-based payments | 136 | 6 | 136 | 6 |
| | Opening shareholders’ funds | 6,646 | 52 | 6,719 | 52 |
| | | 10,587 | 6,646 | 10,635 | 6,719 |
| 6. | Reconciliation of operating loss to net cash outflow from operating activities | ||||
| | | | |||
| | | Consolidated | Company | ||
| | | 2008 | 2007 | 2008 | 2007 |
| | | £’000 | £’000 | £’000 | £’000 |
| | | | | | |
| | Group operating loss | (6,895) | (517) | (6,912) | (429) |
| | | | | | |
| | Depreciation and amortisation | 4 | 1 | 3 | 1 |
| | Interest income | (180) | (34) | (179) | (34) |
| | Share-based payment charge | 136 | 6 | 136 | 6 |
| | VAT refunds received | (73) | 49 | (73) | 49 |
| | Impairment in investments | 5,985 | - | 6,068 | - |
| | Forex loss | (12) | - | (12) | - |
| | Decrease/(Increase) in debtors | 38 | (98) | 33 | (93) |
| | Increase in creditors | 23 | 88 | 46 | 17 |
| | | | | | |
| | Net Cash outflow from operating activities | (974) | (505) | (890) | (483) |
Copies of the Annual Report & Financial Statements are expected to be posted on 23 December 2008 to those shareholders who have elected to receive hard copy shareholder communications from the Company and will also be available to download from the Company's website at www.bezantresources.com
The Annual Report will also be made available for inspection at the Company's registered office during normal business hours on any weekday. Bezant Resources Plc is registered in England and Wales with registered number 2918391. The registered office is at Quadrant House, Floor 6, 17 Thomas More Street, Thomas More Square, London E1W 1YW.