11 May 2017 14:50
Central Rand Gold Limited (Incorporated as a company with limited liability under the laws of Guernsey, Company Number 45108) (Incorporated as an external company with limited liability under the laws of South Africa, Registration number 2007/019223/10) ISIN: GG00B92NXM24 LSE share code: CRND JSE share code: CRD ("Central Rand Gold" or the "Company") |
Suspension of Trading |
As reported on 10 May 2017, the negotiation of annual wage increases has ended in a dead lock, and the employees have embarked on industrial action in the form of a strike. The Company reports that relations are worsening and that management of its subsidiaries have been excluded from the premises, preventing the Company's Board of Directors from receiving timely and accurate information about the Company's operations, including the Company's finances and meaning the Company's operations are not delivering any cash flow.
Whilst every effort has been made to reach a resolution with the strikers, the Company continues to lose production days due to the industrial action and will do so for the immediate future until the dispute is resolved. Even then, it will take time for the operations to resume at usual levels. Whilst the Board of Directors continue to exercise the utmost prudence in the Company's cash expenditure this loss of revenue combined with recent and previously announced operational setbacks has materially negatively affected the Company's cash position.
The Company continues to work with Mr Wang to arrange the delivery of the final tranche of the loan announced on 10 January 2017 and is reviewing other funding options, but cannot guarantee successful timely agreement in these discussions.
The Company cannot therefore guarantee that it will be able to meet its financial obligations as they fall due. The Company has operational cash commitments totalling approximately US$1m in the coming month.
The Company has accordingly requested a suspension in trading in its shares.
The Company hopes to update the market presently.
For further information, please contact:
Central Rand Gold +27 (0) 87 310 4400
Lola Trollip
ZAI Corporate Finance Ltd - Nominated Adviser & Broker +44 (0) 20 7060 2220
John Treacy
Brandon Hill Capital Limited - Broker +44 (0) 20 3463 5000
Jonathan Evans / Wei Jiao
Merchantec Capital - JSE Sponsor +27 (0) 11 325 6363
Monique Martinez / Marcel Goncalves
Johannesburg
11 May 2017
The information communicated in this announcement is inside information for the purposes of Article 7 of Market Abuse Regulation 596/2014 ("MAR").