Last checked at 25 Jul 2008 07:00
GOLDSTONE RESOURCES LIMITED
("GoldStone" or the "Company")
FINAL RESUILTS
Chief Executive's Report
I am setting out below a review of GoldStone's activities during the year ended 28 February 2008 which incorporates an update on the current status of the Company's projects.
BAUXITE
Detailed sampling was undertaken during the first quarter of 2007 on the Company's bauxite interests in Guyana, South America. GoldStone has since received all the results from this completed programme. During July 2007 BHP Billiton elected not to exercise its option over the bauxite interests and subsequently made available to the Company all information in its possession relating to the exploration programme, as well as a summarising geological report. GoldStone has, after a thorough review of all the BHP Billiton information, exercised its right to apply for eleven prospecting licences within the area of the reconnaissance permission.
The Company is in continuing discussions with participants in the bauxite industry with the objective of commercialising these interests.
SWARTDORING DIAMOND PROJECT
In January 2008 the Company appointed Snowden Mining Industry Consultants (Pty) Ltd ("Snowden") to oversee its planned exploration programme for the Swartdoring Diamond Project, with the objective of generating a Snowden-endorsed bankable feasibility study on the project.
Snowden recommended that the planned programme be redesigned so that the exploration be undertaken initially on only part of the Inferred Resource in order to maximise the value of the drilling and sampling programme while minimising risk. Such a programme would have been designed to provide an Indicated Resource in compliance with JORC standards of up to 1.9 million tonnes, out of the total 12 million tonne Inferred Resource, in an area of approximately 250m by 1,000m with mining commencing in 12 to 18 months.
The Board anticipated that the revised exploration programme would require an investment substantially in excess of US$500,000. The increase in exploration costs coupled with the substantial reduction in the potentially Indicated Resource, led the Board to conclude that the criteria set for the acquisition of the project were no longer satisfied. GoldStone accordingly decided early in March 2008 to terminate the acquisition and this was accepted by the vendor, GeoQuest Holdings Limited.
DR3-EAST URANIUM PROJECT
In line with GoldStone's policy of searching for sediment hosted minerals, the Company commenced an investigation during January 2008 into a uranium deposit in South Africa. The conclusion of this process led to GoldStone conditionally agreeing to acquire a 100 per cent. interest in a uranium exploration project from Hymrai Properties 1 (Pty) Ltd which is known as the DR3-East Uranium Project.
The area held under the prospecting permit occupies 43 km2 and is adjacent to Areva's DR3 uranium resource, some 55km north of the town of Laingsburg in the Western Cape Province of South Africa. An examination and re-interpretation of the historical exploration data obtained by GoldStone is ongoing.
GOLD
Since March 2008 the Board has focused particularly on palaeoplacer and hydrothermal gold prospects, in order to leverage the Company's expertise in this field. The Company has consequently been assessing and reviewing international opportunities in this field.
Positive results of research completed into the prospectivity, political stability and mining legislation of certain of the selected countries have led to applications for and/or the granting of the following gold exploration permits:
Mali
In June 2008 the Company was granted two gold exploration permits in Mali, West Africa. The Baroya and Metedia permit areas (the "Permit Areas") are contiguous and occupy a total area of 15 km2, close to the international border with Senegal in the south-western gold belt of Mali. The granted permits are within 8km of the Tabakoto/Segala gold mine, which went into production during 2006 and was recently acquired by Avion Resources. The permits grant the Company exclusive exploration rights for a period of three months. At the end of this period the Company may elect to renew the permits for a second evaluation period of three months or apply for a prospecting licence valid for a period of two years. A further area adjacent to the Permit Areas is still under application with the Malian Director of Geology and Mines ("DNGM").
The Permit Areas have previously been explored by various Malian and international companies. The most recent report available from the DNGM for the Permit Areas is dated 2003 and indicates that exploration was discontinued on the Permit Areas during 2003 when the gold price was approximately US$350 per ounce and also before the Tabakoto gold mine entered into production.
Senegal
The Company has lodged applications for three gold exploration permits in Senegal, West Africa.
The Sangola (471 km2), Dindefelou (280 km2) and Velingara (575 km2) licences applied for all lie within the prospective Kenieba inlier of the Birimian Formation and are close to the border of Guinea. Two of the permit areas in question contain potential hydrothermal gold mineralization, whilst the third may contain palaeoplacer gold mineralization. The Directors believe that these areas have not been explored using modern techniques and accordingly may hold the potential for new gold discoveries. Senegalese mining legislation provides for a processing period of six months from the date an exploration application is lodged.
India
GoldStone has applied to the Foreign Investment Promotion Board ("FIPB") of India to establish a subsidiary company in order to explore for gold, diamond and uranium mineral resources. Following the FIPB's approval for gold and diamonds and further investigations by the Company, GoldStone has submitted an application to explore an identified basin in one of the states of India where Witwatersrand type palaeoplacer sedimentation has been described in a publication by the Geological Society of India. During previous exploration by the Government of India, a basal quartz-pebble conglomerate unit was found to have been invariably mineralised with pyrite and uranium, a well known characteristic of Witwatersrand palaeoplacers. GoldStone has visited this site and the Board is of the opinion that the deposits deserve detailed exploration.
LISTING ON ALTx
The Directors are of the opinion that a listing on the Alternative Exchange of the JSE Limited ("ALTX") would raise the Company's profile, open new avenues for fund raising for the Company, if required, and will provide improved liquidity for the Company's shareholders at a relatively low cost. In addition an ALTX listing will allow GoldStone to invest in the South African Development Community ("SADC"), a region that is well-known for its exploration opportunities.
FINANCING
The Company's cash resources are currently approximately US$2 million.
BOARD
We were pleased to welcome Dr. Hendrik Schloemann to the Board as Director of Exploration and New Business Development during April 2008.
The Board believes that his appointment to the portfolio of Exploration and Business Development will further the expansion of the Company's gold exploration horizons. Dr. Schloemann's focus will be on hydrothermal gold deposits.
OUTLOOK
The Board looks forward to completing the acquisition of the DR3-East Uranium Project, which has the potential to provide near-term revenue for the Company and to rebuild value for shareholders. The listing of GoldStone on the ALTX is progressing and the Board expects that this process will be concluded during the current calendar year in order to enable the completion of the acquisition of the DR3-East Uranium Project.
The Board took a decision during March 2008 to focus the Company's principal activities on the exploration for palaeoplacer and hydrothermal gold mineralization as well as associated minerals, such as silver, copper and uranium. As a consequence the Board is investigating and reviewing other potential exploration projects in this area.
APPROVAL
Dr. Lawrie Minter, who holds a PhD in palaeoplacer sedimentology, has reviewed and approved the content of this announcement.
Nico van der Hoven
Chief Executive Officer
23 July 2008
Enquiries:
| GoldStone Resources Ltd | 00 27 21 794 4004 |
| Nico van der Hoven (Chief Executive Officer) | |
| Hanson Westhouse Limited | 0113 246 2610 |
| Tim Feather / Matthew Johnson |
| STATEMENT OF OPERATIONS For the year ended 28 February 2008 | |||
| Note | Year ended 2008 $ | Year ended 2007 $ | |
| Turnover | |||
| Management fees - continuing operations | 47,500 | 139,722 | |
| Interest receivable - continuing operations | 136,161 | 141,583 | |
| 183,661 | 281,305 | ||
| Exploration expenses | |||
| Exploration expenses - continuing operations | (105,793) | - | |
| Exploration expenses - discontinued operations | - | (759,626) | |
| Gross profit/(loss) | 77,868 | (478,321) | |
| Other operating expenses - continuing operations | (847,189) | (490,857) | |
| OPERATING LOSS FOR THE FINANCIAL YEAR | |||
| From continuing operations | (769,321) | (209,552) | |
| From discontinued operations | - | (759,626) | |
| Profit on disposal of fixed asset - discontinued operations | - | 290,929 | |
| LOSS FOR THE FINANCIAL YEAR | (769,321) | (678,249) | |
| Loss per ordinary share | 1 | ||
| Basic, from continuing operations (cents per share) | (0.6c) | (0.2c) | |
| Basic, from discontinued operations (cents per share) | - | (0.3c) |
| BALANCE SHEET 28 February 2008 | Year ended 2008 $ | Year ended 2007 $ |
| FIXED ASSETS | ||
| Tangible assets | 21,016 | 30,490 |
| CURRENT ASSETS | ||
| Debtors and prepayments | 19,195 | 48,540 |
| Cash at bank | 2,336,447 | 3,103,109 |
| 2,355,642 | 3,151,649 | |
| CREDITORS: amounts falling due within one year | ||
| Creditors and accruals | (42,519) | (78,679) |
| Net current assets | 2,313,123 | 3,072,970 |
| TOTAL ASSETS LESS CURRENT LIABILITIES | 2,334,139 | 3,103,460 |
| CAPITAL AND RESERVES | ||
| Share capital | 2,354,482 | 2,354,482 |
| Share premium | 13,849,554 | 13,849,554 |
| Capital contribution reserve | 555,110 | 555,110 |
| Accumulated deficit | (14,385,007) | (13,655,686) |
| SHAREHOLDERS' FUNDS | 2,334,139 | 3,103,460 |
| STATEMENT OF CHANGES IN EQUITY 28 February 2008 | Year ended 2008 $ | Year ended 2007 $ |
| SHARE CAPITAL - £0.01 par value | ||
| Authorised - 250,000,000 shares | ||
| Issued and fully paid - 130,816,663 shares | 2,354,482 | 2,354,482 |
| SHARE PREMIUM | 13,849,554 | 13,849,554 |
| CAPITAL CONTRIBUTION RESERVE | 555,110 | 555,110 |
| ACCUMULATED DEFICIT | ||
| Balance at beginning of year | (13,655,686) | (12,977,437) |
| Net loss | (769,321) | (678,249) |
| Balance at end of year | (14,425,007) | (13,655,686) |
| 2,334,139 | 3,103,460 | |
| CASH FLOW STATEMENT For the year ended 28 February 2008 | Year ended 2008 $ | Year ended 2007 $ |
| Net cash outflow from operating activities | (898,997) | (705,657) |
| Investing activities | ||
| Interest received | 136,161 | 141,583 |
| Purchase of fixed assets | (3,826) | (3,968) |
| Sale of fixed assets | - | 350,000 |
| (766,662) | (218,042) | |
| Decrease in cash | (766,662) | (218,042) |
| Cash at beginning of the year | 3,103,109 | 3,321,151 |
| Cash at end of the year | 2,336,447 | 3,103,109 |
| Reconciliation of operating loss to net cash outflow from operating activities | ||
| Loss for the financial year | (769,321) | (678,249) |
| Adjusted for: | ||
| Depreciation | 13,299 | 50,233 |
| Profit on disposal of fixed asset | - | (290,929) |
| Interest received | (136,161) | (141,583) |
| Decrease in debtors | 29,345 | 346,023 |
| (Decrease)/increase in creditors | (36,159) | 8,848 |
| Net cash outflow from operating activities | (898,997) | (705,657) |
Notes
1. LOSS PER ORDINARY SHARE
Basic earnings per share is calculated by dividing the losses attributable to ordinary shareholders by the weighted average number of ordinary shares in issue after the placing on the AIM. Diluted earnings per share is calculated using the weighted average number of ordinary shares in issue as adjusted to assume conversion of all dilutive potential ordinary shares.
|
| 2008 $ | 2007 $ |
| Loss per ordinary share | ||
| Loss attributable to share holders from continuing operations | (769,321) | (209,552) |
| Loss attributable to share holders from discontinued operations | - | (468,697) |
| Weighted average number of ordinary shares | 130,816,633 | 130,816,633 |
| Basic loss per share from continuing operations (cents) | (0.6c) | (0.2c) |
| Basic loss per share from discontinued operations (cents) | - | (0.3c) |
2. ANNUAL REPORT
The annual report and accounts for the year ended 28 February 2008 will be posted to shareholders in the week commencing 11 August 2008 and will be available from the Company's website at www.goldstoneresources.com from the date of posting.