ECR Minerals Regulatory News (ECR)

28 Feb 2005 14:50

Mercator Gold PLC28 February 2005 Georgian House, 63 Coleman Street, London, EC2R 5BB Tel +44-7786 486645 Fax +44-20-76380756 Unaudited results for the nine months ended 30 November 2004 LONDON - 28 February 2005 - The Directors of Mercator Gold plc (AIM: MCR), theUK based gold exploration company, are pleased to announce its results for thenine months ended 30 November 2004. Highlights • Admission to AIM on 8 October 2004 • Annean Joint Venture - drilling commenced at Yaloginda • Geophysical program commenced at Meekatharra on target Post 30 November 2004 •Initial drilling of Bluebird, one of the three resource extension targets bring drilled in the Yaloginda region near Meekatharra, intersects high-grade gold. •High-grade gold mineralization intersected at Surprise, the second of three targets being drilled in the Yaloginda region near Meekatharra. •Additional £1.25 million funding raised •Ocean Equities Ltd appointed as joint broker Commenting on the results, Patrick Harford, Managing Director of Mercator said: "The last nine months have been highly significant for Mercator Gold. Ourdecision to list on AIM in October followed by the rapid delineation ofhigh-grade gold at Bluebird and Surprise has earned us continued support fromthe market and allowed us to raise an additional £1.25 million in funding. Weare now well placed to explore the potential of our significant Meekatharra goldproperties and look forward to generating shareholder value in the periodahead." For more information Mercator Gold plc www.mercatorgold.com Patrick Harford, Managing Director Tel: +44 (0) 7786 486645Terry Strapp, Chairman Tel : +61 (0) 8 9322 7422 Beaumont Cornish LimitedRod Venables / Roland Cornish Tel: +44 (0) 7628 3396 Phillip Securities UK LimitedNick Bealer Tel: +44 (0) 20 7553 8281 Parkgreen CommunicationsJustine Howarth / Ana Ribeiro Tel: +44 (0) 20 7493 3713 Management Commentary and Analysis of Financial Position and Results ofOperations The Company announces its interim statement for the period from incorporation to30 November 2004 during which time much has been achieved. Prior to admission toAIM on 8 October 2004 the Company acquired the whole of the issued share capitalof Aurogenic Resources Pty Ltd, now renamed Mercator Gold Australia Pty Ltd,which holds the Annean Joint Venture with St Barbara Mines Limited atMeekatharra in Western Australia. The Company then proceeded to raise £1.89million in funding to allow work to commence on the Annean Joint Venture. Underthe terms of the Annean Joint Venture the Company has the right to earn a 70%interest in the Meekatharra properties by spending AUD$8 million on exploration. Since its admission to AIM the Company has announced results from theexploration work at Meekatharra which are detailed in the Company's pressrelease of 9 December 2004 and 18 January 2005. The initial drilling atMeekatharra has returned encouraging results the full details of which can befound at the Company web site www.mercatorgold.com On 14 February 2005 the Company announced it had successfully raised a further£1.25 million which will be used to fund drilling at Meekatharra and for generalworking capital. It was also announced that Mercator had appointed OceanEquities Ltd as Joint Broker to the Company. OutlookMercator's management has an initial exploration target of 2 million ounces ofgold contained within four resources, each of at least 500,000 ounces within theAnnean Joint Venture area. The Company has reported high-grade drilling resultsfrom the first two target areas, Bluebird and Surprise. Mercator Gold Plc Consolidated Profit and Loss Accountfor the Period 22 March 2004 to 30 November 2004 - Unaudited £ TURNOVER - Administrative expenses 469,203 (469,203) Other operating income 15,360 OPERATING LOSS (453,843) Interest receivable and similar income 9,406 (444,437) Interest payable and similar charges 208 LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION (444,645) Tax on loss on ordinary activities - LOSS FOR THE FINANCIAL PERIOD (444,645) AFTER TAXATION DEFICIT FOR THE PERIOD FOR THE GROUP (444,645) LOSS PER SHARE (pence) - (0.0086p) basic and diluted CONTINUING OPERATIONS None of the group's activities were discontinued during the currentperiod. TOTAL RECOGNISED GAINS AND LOSSES The group has no recognised gains or losses other than the loss forthe current period. Mercator Gold Plc Consolidated Balance Sheet30 November 2004 - Unaudited £ £FIXED ASSETSIntangible assets 735,995Tangible assets 19,956Investments - 755,951 CURRENT ASSETSDebtors 132,569Cash at bank 942,336 1,074,905 CREDITORSAmounts falling due within one year 214,623 NET CURRENT ASSETS 860,282 TOTAL ASSETS LESS CURRENTLIABILITIES 1,616,233 CAPITAL AND RESERVESCalled up share capital 514,948Share premium 1,545,930Profit and loss account (444,645) SHAREHOLDERS' FUNDS 1,616,233 ON BEHALF OF THE BOARD: .................................................................M J De Villiers - DirectorApproved by the Board on: 28 February 2005 Mercator Gold Plc Cash Flow Statementfor the Period 22 March 2004 to 30 November 2004 - Unaudited Notes £Net cash outflowfrom operating activities 1 (358,693) Returns on investments and Servicing of finance 2 9,198 Capital expenditure 2 (769,047) (1,118,542) Financing 2 2,060,878 Increase in cash in period 942,336 ------------------------- ----------- --------- Reconciliation of net cash flow to movement in net debt 3 Increase in cash in the period 942,336 Change in net debt resulting From cash flows 942,336 Movement in net debt in the period 942,336 Net debt at 22 March 2004 - Net funds at 30 Novemb r 2004 942,336 Mercator Gold Plc Notes to the Cash Flow Statementfor the Period 22 March 2004 to 30 November 2004 - Unaudited 1. RECONCILIATION OF OPERATING LOSS TO NET CASH OUTFLOW FROM OPERATING ACTIVITIES £Operating loss (453,843)Depreciation charges 13,096Increase in debtors (132,569)Increase in creditors 214,623 Net cash outflow from operating activities (358,693) 2. ANALYSIS OF CASH FLOWS FOR HEADINGS NETTED IN THE CASH FLOW STATEMENT £ Returns on investments and servicing of finance Interest received 9,406 Interest paid (208) Net cash inflow for returns on investments and servicing of finance 9,198 Capital expenditure Purchase of intangible fixed assets (745,138) Purchase of tangible fixed assets (23,909) Net cash outflow for capital expenditure (769,047) Financing Share issue 514,948 Share premium 1,545,930 Net cash inflow from financing 2,060,878 3. ANALYSIS OF CHANGES IN NET DEBT At At 22.3.04 Cash flow 30.11.04 £ £ £Net cash:Cash at bank - 942,336 942,336 - 942,336 942,336 Total - 942,336 942,336 Mercator Gold Plc Notes to the Financial Statementsfor the Period 22 March 2004 to 30 November 2004 - Unaudited 1. ACCOUNTING POLICIES Accounting convention The financial statements have been prepared in accordance with applicableaccounting standards generally accepted in the United Kingdom. These interimfinancial statements are unaudited and do not constitute statutory accounts asdefined by Section 240 of the Companies Act 1985. Basis of consolidation The Group financial statements consolidate the financial statements of theCompany and its subsidiary undertaking made up to 30 November 2004. The profits and losses of the subsidiary undertaking are consolidated from thedate of acquisition to the date of disposal. On acquisition, the assets andliabilities of a subsidiary are measured at their fair value at the date ofacquisition. Goodwill Goodwill, being the amount paid in connection with the acquisition of a business in 2004, is being amortised evenly over its estimated useful life of twenty years. Exploration and development costs Costs relating to the acquisition, exploration and development of mineralproperties are capitalised until such time as an economic reserve is defined and mining commences or the mining property is abandoned. Once mining commences the asset is amortised on a depletion percentage basis.Provision is made for impairments to the extent that the asset's carrying valueexceeds its net recoverable amount. Computer software Computer software is amortised over its estimated useful life at 40% on cost. Tangible fixed assets Depreciation is provided at the following annual rates in order to write offeach asset over its estimated useful life. Plant and machinery - 20% to 50% on costFixtures and fittings - 20% to 50% on cost Deferred tax In accordance with FRS19 full provision is made at current rates for taxationdeferred in respect of all timing differences. Deferred tax balances are notdiscounted. Deferred tax assets are only recognised where they arise from timing differences where their recoverability is regarded as more likely than not. 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 foreigncurrencies are translated into sterling at the rate of exchange ruling at thedate of transaction. Exchange differences are taken into account in arriving atthe operating result.For the purpose of consolidation the balance sheets of the foreign subsidiariesare translated at the closing rate and the profit and loss accounts at theaverage rate during the year. Mercator Gold Plc Notes to the Financial Statements - continuedfor the Period 22 March 2004 to 30 November 2004 - Unaudited 1. ACCOUNTING POLICIES - continued Going concern The Group is in the early stages of development and has limited cash resources,its success will depend largely upon the outcome of future mining explorationand development programmes of Mercator Gold Australia Pty Limited in Australia. The directors believe they have considered all relevant information and haveconcluded that it is appropriate to prepare these financial statements on thegoing concern basis. The financial statements do not include any adjustmentsthat may be required if the funds are not available or if the trading plans were not materially achieved. Hire purchase and leasing commitmentsRentals paid under operating leases are charged to the profit and loss accountas incurred. 2. LOSS PER SHARE Basic earnings/(loss) per share is computed by dividing the profit or loss after taxation for the period available to the ordinary shareholders by the sum of the weighted average number of ordinary shares in issue and ranking for dividend during the period. Diluted earnings/(loss) per share is computed by dividing the profit or loss after taxation for the period by the weighted average number of ordinary shares in issue, adjusted for the effect of all dilutive potential ordinary shares that were outstanding during the period. The following sets forth the computation for the Company's basic and dilutedloss per share (LPS) Numerator £ Numerator for basic LPS retained loss (444,645) Denominator Number Denominator for basic LPS 51,494,800 Effects of diluted securities - options 78,791,900 130,286,700 Basic LPS (0.0086p) Diluted LPS (0.0086p) The basic and diluted loss per share are the same as the effect of theoutstanding shares options is anti dilutive and therefore excluded. This information is provided by RNS The company news service from the London Stock Exchange