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26 Sep 2013 07:00
Eurasia Mining plc
Interim report
for the six months ended
30 June 2013
Chairman's Statement
In the six months to June 2013, the Company completed a major expansion study for the West Kytlim project in the Urals, with a view to developing a larger mining operation once a production licence has been granted.
At Kola follow up drilling at West Nittis on the Monchetundra Licence confirmed the presence of high grade PGM mineralization for detailed appraisal.
West Kytlim
Drilling continued over the period and added further to the platinum resources in the main river complex of the Tylai-Kosvinsky Placer. The results of this work culminated in the submission of a new Russian standards compliant report providing technical and economic justification for the approval of expanded reserves. The associated economic calculations in this reserves approval application demonstrate the feasibility of production at West Kytlim from multiple sites concurrently.
The development of near surface alluvial platinum deposits like West Kytlim, is attractive both technically and commercially. This is due to the ease of ore processing using readily available equipment and due to the resultant low capital and operating costs.
Monchetundra
Drilling at West Nittis during the summer confirmed the presence of zones of mineralization which have an affinity with ore bodies elsewhere in the district that were mined for high grade nickel and copper veins between 1937 and 1971. The drilling confirmed that the zones remain open on strike and at depth. The potential for PGM deposits has been largely ignored until recent exploration.
Michael Martineau
Chairman
Condensed consolidated statement of comprehensive income
for the six months ended 30 June 2013
Note | 6 months to | 12 months to | 6 months to | |
30 June | 31 December | 30 June | ||
2013 | 2012 | 2012 | ||
(unaudited) | (audited) | (unaudited) | ||
Revenue | 10,055 | 62,223 | 37,581 | |
Administrative costs | (273,646) | (756,051) | (317,312) | |
Loss on revised period of repayment of the loanmade to joint venture | 5 | (136,152) | (651,006) | |
Finance income | 2,444 | 9,025 | 1,556 | |
Other financial results | 115,943 | (22,788) | 23,061 | |
Loss before tax | (281,356) | (1,358,597) | (255,114) | |
Income tax expense | - | - | - | |
Loss for the period | (281,356) | (1,358,597) | (255,114) | |
Other comprehensive (loss)/income: | ||||
Exchange differences on translationof foreign operations | (84,435) | 811 | (29,117) | |
Other comprehensive (loss)/income for the period, net of tax | (84,435) | 811 | (29,117) | |
Total comprehensive loss for the period | (365,791) | (1,357,786) | (284,231) | |
Loss for the period attributable to: | ||||
Owners of the parent | (277,707) | (1,331,700) | (216,372) | |
Non-controlling interest | (3,649) | (26,897) | (1,067) | |
(281,356) | (1,358,597) | (217,439) | ||
Total comprehensive loss for the period attributable to: | ||||
Owners of the parent | (378,880) | (1,318,639) | (280,096) | |
Non-controlling interest | 13,089 | (39,147) | (4,135) | |
(365,791) | (1,357,786) | (284,231) | ||
Basic and diluted loss (pence per share) | (0.03) | (0.17) | (0.03) |
Condensed consolidated statement of financial position
as at 30 June 2013
Note | At 30 June | At 31 December | At 30 June | |
2013 | 2012 | 2012 | ||
(unaudited) | (audited) | (unaudited) | ||
ASSETS | ||||
Non-current assets | ||||
Property, plant and equipment | 4 | 26,679 | 24,876 | 24,278 |
Other financial assets | 5 | 2,880,071 | 2,526,665 | 2,736,353 |
Total non-current assets | 2,906,750 | 2,551,541 | 2,760,631 | |
Current assets | ||||
Inventories | 1,428 | 1,618 | 291 | |
Trade and other receivables | 92,404 | 58,434 | 47,975 | |
Cash and bank balances | 998,448 | 1,735,420 | 2,528,607 | |
Total current assets | 1,092,280 | 1,795,472 | 2,576,873 | |
Total assets | 3,999,030 | 4,347,013 | 5,337,504 | |
EQUITY | ||||
Capital and reserves | ||||
Issued capital | 6 | 22,327,527 | 22,327,527 | 22,327,527 |
Reserves | 7 | 3,188,172 | 3,289,345 | 3,183,545 |
Accumulated losses | (21,944,524) | (21,666,817) | (20,589,164) | |
Equity attributable to equity holders of the parent | 3,571,175 | 3,950,055 | 4,921,908 | |
Non-controlling interest | 284,722 | 259,257 | 294,269 | |
Total equity | 3,855,897 | 4,209,312 | 5,216,177 | |
LIABILITIES | ||||
Current liabilities | ||||
Trade and other payables | 143,133 | 137,701 | 121,327 | |
Total current liabilities | 143,133 | 137,701 | 121,327 | |
Total liabilities | 143,133 | 137,701 | 121,327 | |
Total equity and liabilities | 3,999,030 | 4,347,013 | 5,337,504 |
Condensed statement of changes in equity
for the six months ended 30 June 2012
Attributable to owners of the parent | ||||||||||
Note | Sharecapital | Share premium | Deferred shares | Other reserves | Translation reserve | Accumulated losses | Total attributable to owners of parent | Non-controlling interest | Total equity | |
Balance at 1 January 2012 | 676,969 | 11,740,075 | 7,025,483 | 3,878,093 | (668,499) | (20,335,117) | 2,317,004 | 298,404 | 2,615,408 | |
Issue of share capital | 6 | 288,500 | 2,596,500 | - | - | - | - | 2,885,000 | - | 2,885,000 |
Transaction with owners | 288,500 | 2,596,500 | - | - | - | - | 2,885,000 | - | 2,885,000 | |
Loss for the period | (254,047) | (254,047) | (1,067) | (255,114) | ||||||
Other comprehensive loss | ||||||||||
Exchange differences on translationof foreign operations | - | - | - | - | (26,049) | - | (26,049) | (3,068) | (29,117) | |
Total comprehensive income | - | - | - | - | (26,049) | (254,047) | (280,096) | (4,135) | (284,231) | |
Balance at 30 June 2012 | 965,469 | 14,336,575 | 7,025,483 | 3,878,093 | (694,548) | (20,589,164) | 4,921,908 | 294,269 | 5,216,177 | |
Condensed statement of changes in equity
For the six months ended 30 June 2013
Attributable to owners of the parent | ||||||||||
Note | Sharecapital | Share premium | Deferred shares | Other reserves | Translation reserve | Accumulated losses | Total attributable to owners of parent | Non-controlling interest | Total equity | |
Balance at 1 January 2013 | 965,469 | 14,336,575 | 7,025,483 | 3,944,783 | (655,438) | (21,666,817) | 3,950,055 | 259,257 | 4,209,312 | |
Contributed by non-controlling party | - | - | - | - | - | - | - | 12,376 | 12,376 | |
Transaction with owners | - | - | - | - | - | - | - | 12,376 | 12,376 | |
Loss for the period | (277,707) | (277,707) | (3,649) | (281,356) | ||||||
Other comprehensive loss | ||||||||||
Exchange differences on translationof foreign operations | - | - | - | - | (101,173) | (101,173) | 16,738 | (84,435) | ||
Total comprehensive income | - | - | - | - | (101,173) | (277,707) | (378,880) | 13,089 | (365,791) | |
Balance at 30 June 2013 | 965,469 | 14,336,575 | 7,025,483 | 3,944,783 | (756,611) | (21,944,524) | 3,571,175 | 284,722 | 3,855,897 | |
Condensed consolidated statement of cash flows
for the six months ended 30 June 2013
6 months to | 12 months to | 6 months to | ||
30 June | 31 December | 30 June | ||
2013 | 2012 | 2012 | ||
(unaudited) | (audited) | (unaudited) | ||
Cash flows from operating activities | ||||
Loss for the period | (281,356) | (1,358,597) | (255,114) | |
Adjustments for: | ||||
Depreciation and amortisation of non-current assets: | ||||
- Fixed assets | 291 | 372 | 193 | |
Loss on revised period of repayment of the loan made to joint venture | 136,152 | 651,006 | - | |
Net foreign exchange (profit)/loss | (115,943) | 22,788 | (23,061) | |
Investment revenue recognised in profit and loss | (2,444) | (9,025) | (1,556) | |
Costs recognised in profit or loss in respect of equity-settled share-based payments | - | 66,690 | - | |
(263,300) | (626,766) | (279,538) | ||
Movements in working capital | ||||
Decrease/(increase) in inventories | 190 | (1,242) | 85 | |
Increase in trade and other receivables | (34,068) | (26,215) | (16,109) | |
Increase/(decrease) in trade and other payables | 4,500 | (19,186) | (35,787) | |
Cash used in operations | (292,678) | (673,409) | (331,349) | |
Net cash used in operating activities | (292,678) | (673,409) | (331,349) | |
Cash flows from investing activities | ||||
Advanced to joint venture | (459,028) | (655,398) | (197,318) | |
Contributed by non-controlling party | 12,376 | - | - | |
Payments for property, plant and equipment | (2,202) | (572) | (165) | |
Interest received | 2,444 | 9,025 | 1,556 | |
Net cash used in investing activities | (446,410) | (646,945) | (195,927) | |
Cash flows from financing activities | ||||
Proceeds from issues of equity shares | - | 2,885,000 | 2,885,000 | |
Net cash generated by financing activities | - | 2,885,000 | 2,885,000 | |
Net (decrease)/increase in cash and cash equivalents | (739,088) | 1,564,646 | 2,357,724 | |
Effects of exchange rate changes on the balance ofcash held in foreign currencies | 2,116 | (324) | (215) | |
Cash and cash equivalents at the beginning of period | 1,735,420 | 171,098 | 171,098 | |
Cash and cash equivalents at the end of the period | 998,448 | 1,735,420 | 2,528,607 |
Selected notes to the condensed consolidated financial statements
for the six months ended 30 June 2013
1. General information
Eurasia Mining Plc (the "Company") is a public limited company incorporated and domiciled in Great Britain with its registered office and principal place of business at Suite 139, Grosvenor Gardens House, 35-37 Grosvenor Gardens, London SW1W 0BS. The Company's shares are listed on the Alternative Investment Market of the London Stock Exchange. The principal activities of the Company and its subsidiaries (the "Group") are related to the exploration for and development of platinum group metals, gold and other minerals in Russia.
The financial information set out in these condensed interim consolidated financial statements (the "Interim Financial Statements") do not constitute statutory accounts as defined in Section 435 of the Companies Act 2006. The Group's statutory financial statements for the year ended 31 December 2011, prepared under International Financial Reporting Standards (the "IFRS"), have been filed with the Registrar of Companies. The auditor's report on those financial statements was qualified. The report did not contain a statement under Section 498(2) of the Companies Act 2006.
2. Basis of preparation
The Group prepares consolidated financial statements in accordance with International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) ,as endorsed by the European Union (EU). These condensed consolidated interim financial statements for the period ended 30 June 2013 have been prepared by applying the recognition and measurement provisions of IFRS and the accounting policies adopted in the audited accounts for the year ended 31 December 2012.
These Interim Financial Statements have been prepared under the historical cost convention.
The accounting policies have been applied consistently throughout the Group for the purposes of preparation of these condensed consolidated interim financial statements.
The Interim Financial Statements are presented in Pounds Sterling (£), which is also the functional currency of the parent company.
3. Accounting policies
The Interim Financial Statements have been prepared in accordance with the accounting policies adopted in the Group's last annual financial statements for the year ended 31 December 2012.
4. Additions and disposals of property, plant and equipment
30 June | 31 December | 30 June | ||
2013 | 2012 | 2012 | ||
| £ | £ | £ | |
Net book value at the beginning of period | 24,876 | 24,598 | 24,598 | |
Additions | 2,202 | 572 | 165 | |
Depreciation | (291) | (372) | (193) | |
Exchange differences | (108) | 78 | (292) | |
Net book value at the end of period | 26,679 | 24,876 | 24,278 |
5. Other financial assets
30 June | 31 December | 30 June | ||
2013 | 2012 | 2012 | ||
Loan to joint venture | 2,484,279 | 2,154,929 | 2,350,950 | |
Advances to acquire interest in uranium project | 395,792 | 389,392 | 385,403 | |
2,880,071 | 2,544,321 | 2,736,353 |
Loans to joint venture and subsidiaries are provided by the Group on an interest free basis with no fixed date of repayment. The Group does not hold any collateral as security.
In 2012 the Group recognised that the loan advanced to the joint venture were not to be repaid within 12 months from the start of the platinum production mining licence for which is expected to be granted by authorities in Russia. Consequently the Group have fair valued the loan estimating the repayment of the loan based on cash flows due to be generated by the joint venture. The loan was discounted using NPV method and the discount of £136,152 has been recognised in the period (£651,006 in 2012) as an investment into joint venture, which then has been written off to profit and loss. Actual repayment schedule and interest chargeable on the loan will be revised by the joint venture partners as soon as the production licence has been granted.
Undiscounted amount of the loan at 30 June 2013 is £3,271,437.
Advances to acquire interest in uranium project represent payment of $602,000 made in 2011 towards acquisition of 55% interest in the Kamushanovsky uranium project in Kyrgyzstan.
6. Share capital
30 June | 31 December | 30 June | ||
2013 | 2012 | 2012 | ||
Issued ordinary shares with a nominal value of 0.1p: | ||||
Number | 965,468,701 | 965,468,701 | 965,468,701 | |
Nominal value (£) | 965,469 | 965,469 | 965,469 | |
Fully paid ordinary shares carry one vote per share and carry the right to dividends. | ||||
Issued deferred shares with a nominal value of 4.9 p: | ||||
Number | 143,377,203 | 143,377,203 | 143,377,203 | |
Nominal value (£) | 7,025,483 | 7,025,483 | 7,025,483 | |
Deferred shares have the following rights and restrictions attached to them:
- they do not entitle the holders to receive any dividends and distributions;
- they do not entitle the holders to receive notice or to attend or vote at General Meetings of the Company;
- on return of capital on a winding up the holders of the deferred shares are only entitled to receive the amount paid up on such shares after the holders of the ordinary shares have received the sum of 0.1p for each ordinary share held by them and do not have any other right to participate in the assets of the Company.
7. Reserves
30 June | 31 December | 30 June | ||
2013 | 2012 | 2012 | ||
£ | £ | £ | ||
Capital redemption reserve | 3,539,906 | 3,539,906 | 3,539,906 | |
Foreign currency translation reserve | (756,611) | (655,438) | (694,548) | |
Share-based payment reserve | 404,877 | 404,877 | 338,187 | |
3,188,172 | 3,289,345 | 3,183,545 | ||
The capital redemption reserve was created as a result of a share capital restructuring in earlier years. There is no policy of regular transactions affecting the capital redemption reserve.
The foreign currency translation reserve represents exchange differences relating to the translation from the functional currencies of the Group's foreign subsidiaries into GBP.
The share-based payments reserve represents a reserve arising on the grant of share options to employees under the employee share option plan.
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