Nyota Minerals Regulatory News (NYO)

14 Mar 2008 08:56

Dwyka Resources Limited14 March 2008 14 March 2008 DWYKA RESOURCES LIMITED ('DWYKA' OR THE 'COMPANY') HALF YEAR REPORT FOR THE PERIOD ENDED 31 DECEMBER 2007 The Board of Dwyka is very pleased to report to shareholders that Dwyka has madesolid progress with all its strategic and operational objectives during the halfyear. In conjunction with partners BHP Billiton, exploration work commenced at theMuremera Nickel Project in Burundi. To date BHP Billiton has spent in excess ofUS$2 million on establishing a base camp, initial drilling and geophysical workprogrammes - demonstrating a strong commitment to ensuring the exploration atMuremera is carried out to the highest standards. Core from the first round ofstratigraphic drilling is currently in Johannesburg for assaying and resultswill be conveyed to shareholders as soon as they are available. Drilling willrecommence once the first round of drilling has been assessed and interpreted.Photos of the established camp and exploration programme can be seen atwww.dwyresources.com by clicking on the "Projects" tab. With nickel demand andprices forecast to increase again (Macquarie Research, February 2008) theMuremera Project is a priority for Dwyka. Drilling has been ongoing at the SwaziGold Project in Swaziland, with the rigscurrently on site at the Daisy Prospect. Results to date have includedexcellent results for the Kobolondo, Lufafa and Daisy Prospects. The potentialremains to prove up a small to medium tonnage high grade deposit which will besuitable for stand alone mining or for combining with a nearby operation toincrease reserves and mine life. With the current gold price at around US$970/oz the SwaziGold Project remains extremely attractive. During the half year Dwyka also combined its diamond assets with those of KimCorDiamonds Plc resulting in Dwyka currently positioned as a 48% shareholder inKimor. Diamonds continue to hold their place by value in the top tencommodities in the traded minerals basket despite impressive increases in theprice of most raw materials and Dwyka remains committed to this investment. In addition, the Company has the stated objective of adding an additionalproject to its portfolio. A number of projects have been assessed and we arehopeful of advising shareholders of a suitable acquisition in the near future. Enquiries: In AustraliaMelissa SturgessDwyka Resources Limited(+618) 9324 2955 In the United KingdomRichard BrownAmbrian Partners Limited(+44) 20 7776 6417 Charlie Geller/Leesa PetersConduit PR(+44) 20 7429 6604 or (+44) 7970 067 320 or visit http://www.dwyresources.com The technical exploration and mining information contained in the aboveannouncement has been reviewed and approved by Ed Nealon, who has sufficientexperience which is relevant to the style of mineralisation and type of depositunder consideration and to the activity which he is qualified as a CompetentPerson as defined in the 2004 Edition of the 'Australasian Code for Reporting ofExploration Results, Mineral Resources and Ore Reserves'. Mr Nealon is a DwykaResources Limited Director and meets the criteria of a qualified person underthe AIM guidance note for mining, oil and gas companies. Ed Nealon consents to the inclusion in this announcement of such information inthe form and context in which it appears. DWYKA RESOURCES LIMITED A.C.N. 060 938 552 HALF-YEAR REPORT31ST DECEMBER 2007 DIRECTORS' REPORT The Directors present their report for the half-year ended 31 December 2007. DIRECTORS The names of the Directors of the Company in office during the half-year anduntil the date of this report are: Edward Nealon, Melissa Sturgess, Terrance McConnachie, Michael Langoulant andEvan Kirby. Mr Adrian Griffin was a director at the start of the half year until hisresignation on 30 October 2007. REVIEW AND RESULTS OF OPERATIONS NICKEL Muremera Nickel Project Recent activities Both the drilling and heliborne VTEM surveys have commenced at the Muremeranickel project in Burundi, which is owned by the Company's wholly-ownedsubsidiary Danyland Limited. Drilling Phase 1 drilling was undertaken throughout the half year with four drillholesbeing completed in January 2008 on the Muremera B anomaly, which is consideredprospective due to a superposition of both strong electromagnetic and magneticanomalies. All four holes were drilled for structural/stratigraphic purposes butthe second hole (D002) also intersected semi-massive sulphides between 220 and235 metres. Up to 10,000 metres of drilling is expected in 2008. Assaying Assaying of the core has been delayed to allow for magnetic core orientationstudies. The core has been split at site and half sent to ALS Chemex Laboratoryin Johannesburg. VTEM Surveying During the half year all surveying equipment, including the survey helicopterand personnel, arrived on site and VTEM surveying commenced. Geotech Ltd iscontracted to fly the first B-field VTEM survey in Africa over the Muremeratargets. A total of 5,830 line kilometres is being flown at 100m line spacingand at this stage approximately half of the VTEM survey has been undertaken withcompletion expected during March 2008. This level of detail will enable directdrilling off the VTEM data. About the project The Muremera licence, owned by the Company's wholly-owned subsidiary DanylandLimited ("Danyland"), is located within 2km of the Kabanga project operated byXstrata/Barrick, the world's largest undeveloped nickel sulphide deposit. The Kabanga deposit, which is located immediately across the border in Tanzania,was discovered by geophysical prospecting, by the United Nations DevelopmentProgramme ("UNDP"), in 1976. Further UNDP surveys in 1978 resulted in thediscovery of the prospective Muremera deposits on the Burundi side of the borderin 1978. The anomalies have identical characteristics and follow-up work by theUNDP has confirmed that massive sulphide bodies, with nickel mineralisation, arethe source of the anomalies. Extensive geophysics and geochemical surveys havedelineated numerous targets, however there has been insufficient drilling todate to establish a JORC compliant resource. Shareholders and Earn-in Agreement with BHP Billiton On 23 February 2007, the Company signed a Shareholders and Earn-in Agreementwith BHP Billiton ("BHPB Agreement"), pursuant to which BHP Billiton has agreedto spend at least US$5,200,000 in undertaking certain activities to develop theMuremera Nickel Project, in order to earn a shareholding of up to 50% inDanyland. Under the BHPB Agreement, the BHP Billiton investment will be realised in 3stages as follows: - during the first stage, BHP Billiton will spend a minimum of US$1,200,000 oninitial exploration activities in order to earn a 10% equity in Danyland. Thishurdle is likely to be achieved in April 2008. - during the second stage, BHP Billiton will spend at least US$2,000,000 ontarget testing in order to earn a further 20% equity (total 30%); and - during the third stage, BHP Billiton will spend at least a furtherUS$2,000,000 on resource definition and the completion of a concept study inorder to earn the remaining 20% equity (up to a total of 50% interest inDanyland). BHP Billiton may withdraw from the project during or after completion of any ofthe stages, but if it withdraws during a particular stage it retains only theequity earned by virtue of having completed the previous stage. The project ismanaged by the Danyland board of directors, on which Dwyka and BHP Billiton willhave equal representation. Once BHP Billiton has fully satisfied its earn-in obligations, the parties willcontribute to further development of the project in proportion to theirpercentage shareholdings in Danyland. Normal default and dilution provisionsapply where a party fails to meet its share of project funding. GOLD Swazigold Project Recent activities - Commencement of drilling Drilling has commenced at the Kobolondo, Daisy and Lufafa prospects. Three boreholes have been planned for the Kobolondo prospect to test a 600mstrike length of a mineralised shear zone. Surface sampling of trenchesexcavated by Dwyka on this shear zone have returned stretch intersections of2.82g/t Au over 11m (including 7.70g/t Au over 3m), 2.16g/t Au over 5m(Including 4.84g/t Au over 1m) 4.24g/t Au over 3m (including 7.97g/t Au over1m). Deeper drilling of the Kobolondo prospect will be undertaken in 2008subject to results from the current drill-program. Drilling for the Daisy prospect is targeted to test a shallow portion of the # 1oreshoot that had not been drill-tested by previous investigations. The # 1oreshoot (described in the announcement dated 30 November 2007) is a 65 - 100mwide high-grade oreshoot that has been traced, by diamond drilling, to a depthof 250m. Most of the planned drilling for the Daisy prospect will be undertakenwhen a drill-rig with greater depth-capability is available. At the Lufafa prospect, surface exploration to date suggests that there is thepotential to host 5-25m wide zones of 1-2g/t disseminated Au mineralisation overstrike lengths of < 250m. Three drilling targets have been identified to date,two of which are located in the Lufafa Central area. Three shallow boreholeswill then test the targets at Lufafa Central. The first two aim to intersect azone of mineralisation from which trench sampling returned stretch intersectionsof 1.65g/t Au over 14m, 1.15g/t Au over 19m and 1.23g/t Au over 9m. The thirdborehole is planned to intersect a zone of mineralisation that returnedintersections of 2.61g/t Au over 6m and 4.76g/t Au over 6m. Deeper drilling ofthe Lufafa prospect will be subject to encouraging results from the shallowdrill-holes. Recent activities - Exploration Results Gold mineralisation in the Barberton Greenstone Belt is closely associated withthrust-shear zones that juxtapose strata of differing stratigraphic groups.Four major targets have been recognised to date and Dwyka has carried out recentwork on three of these: Kobolondo, Daisy, and Lufafa. Kobolondo Previous drilling by RTZ and JCI showed a preferentially reactivated shear zoneto be present here returning results of 10.95g/t Au over 1.0m, 14.31g/t Au over2.5m, and 2.27g/t Au over 2.2m. As a follow up, Dwyka has taken 249 rock-chipsamples at Kobolondo showing that significant gold mineralisation exists over astrike length of 600 metres. Highlights of the rock chip sampling from the zoneare: 4.24g/t Au over 3m including 7.97g/t Au over 1m2.82g/t Au over 11m including 7.70g/t Au over 3m2.16g/t Au over 5m including 4.84g/t Au over 1m Daisy The Daisy deposit is hosted by a steeply dipping shear at the contact betweenamphibolite and talc schists. Gold occurs in a 1 to 3m widequart-carbonate-sulphide schist with a strike length of at least 700m. Threezones are recognised at Daisy where previous drilling by RTZ and JCI returnedthe following values: Zone 1 25.8g/t Au over 1.6mZone 2 7.2g/t Au over 1.5mZone 3 5.0g/t Au over 0.9m 19.1g/t Au over 1.3m 5.1g/t Au over 2.0m 4.5g/t Au over 0.9m 8.9g/t Au over 1.5m 5.3g/t Au over 0.8m 7.6g/t Au over 1.2m Additional historical data has now been obtained from Southern Era Resources(SER) providing four additional drill hole intersections in Zone 1 below thehistorical open pit mine. The significant SER results can be summarised asfollows: Borehole DA1-97 1.01g/t Au over 1m 2.76g/t Au over 5m including 3.71g/t over 3mBorehole DA2-97 2.21g/t Au over 1m borehole missed main ore shootBorehole DA3-97 3.60g/t Au over 12.4m including 8.83g/t over 4.2m and 17.19g/t over 1.5mBorehole DA4-97 5.73g/t Au over 4m including 14.20g/t over 1.0m 3.20g/t Au over 1m 1.90g/t Au over 1m Cross-sections have been constructed for all drill-holes for the Daisy minearea. A longitudinal section has been constructed for the #1 Ore Zone. The datasuggests a 65 to 100m wide ore shoot plunging at approximately 30 degrees to thenorth east. Drilling has traced this ore shoot for a distance of 250mdown-plunge. The deepest intersection to date is 5.73g/t Au over 4m (including14.2g/t over 1m). Dwyka considers the Daisy Project continues to have immediate potential to proveup a small to medium tonnage high grade underground gold mine and remains aprime target for the Company. Lufafa Three target areas have previously been identified here: Lufafa North, LufafaCentral, and Lufafa South. Reconnaissance geological mapping and rock chipsampling have been completed. Highlights of the sampling are: 1.54g/t Au over 13m including 5.38g/t over 1m1.83g/t Au over 7m including 6.20g/t over 1m3.61g/t Au over 5m including 14.70g/t over 1m Data to date suggests that the Lufafa Prospect has the potential to host 5-25mwide zones of 1-2g/t disseminated Au mineralisation in Banded Iron Formationsover strike lengths of approximately 250m. Three drilling targets have beenidentified to date. About the project The Swazigold Project is located in Swaziland, in the highly prospectiveArchaean Barberton Greenstone Belt that straddles the border between MpumalangaProvince, South Africa and Swaziland. Such Greenstone Belts host many major golddeposits in South Africa, Canada, and Australia, including the giant Kalgoorliegoldfield. The Barberton Greenstone Belt was the location of the first golddiscovery in South Africa and subsequent gold rush in 1884. Since that time,the belt has produced 11.5 million ounces of gold. Current underground minesinclude the Fairview, Sheba and Consort mines of Barberton Mines Limited. The Project area is a large 425 sq km 'greenfields' exploration play with manytargets ranging from 'walk up' advanced drilling targets to promisinggeochemical anomalies. The prospective licence area comprises more than 40km ofstrike length containing multiple mineralised structures and more than 40 goldshowings. Historic detailed drilling has been restricted to the Wyldsdale,Lomati and Daisy prospects where cumulative drilling by previous owners is inexcess of 13,000 metres. Dwyka's initial conclusion from a review of the geology and of this historicwork is that the potential exists for several million tonnes of high grade goldmineralisation. Shareholders and Earn-in Agreement in relation to Swazigold Project On 16 July 2007, Dwyka's wholly-owned subsidiary Karrinyup Holdings Limited ("Karrinyup") entered into a Shareholders and Earn-in Agreement ("Swazi Agreement") in relation to Swazi Gold Ventures (Pty) Ltd ("SGV"), the holder of 90% ofthe issued shares in Swaziland Gold (Pty) Ltd ("SwaziGold"), which in turn ownsthe Swazigold Project. Under the terms of the Swazi Agreement, Karrinyup has the right to acquire thefollowing percentage shareholdings in SGV on the following basis: - Payment of US$200,000 plus Dwyka shares to the value of US$1,500,000 (atmarket price) - Karrinyup earns a 50% interest; - US$750,000 worth of project expenditure by 30 June 2008; payment of US$200,000plus Dwyka shares to the value of US$1,000,000 (at 80% of market price) -Karrinyup earns a further 20% interest (total 70%); - Payment of US$400,000 plus Dwyka shares to the value of US$1,000,000 (at 80%of market price) by 30 June 2009; project expenditure to reach bankablefeasibility stage by 30 June 2011 - Karrinyup earns a further 15% interest(total 85%); and - Issue of Dwyka shares to the value of US$3,000,000 (at 80% of market price)pursuant to the exercise of an option exercisable at any time within 12 monthsafter the date on which a bankable feasibility study is completed in relation tothe Swazigold Project - Karrinyup acquires remaining 15% interest (total 100%). Under the terms of the Swazi Agreement, Karrinyup will be the manager of theSwazigold Project, which will be overseen by a management committee in which thevendor shareholder in SGV and Karrinyup will each have equal representation.Voting will be in accordance with the parties' shareholding percentages in SGV,provided that the manager will have a casting vote in the event of a deadlock. Karrinyup may withdraw from the Swazigold Project at any time, in which case itwill dilute to a 49.9% shareholding in SGV and will relinquish managementcontrol. In addition, if such withdrawal occurs after the bankable feasibilitystage, Karrinyup will have a 2% royalty with respect to all minerals producedfrom the Swazigold Project area. DIAMONDS Dwyka holds 48% of KimCor Diamonds Plc On 24 September 2007 Dwyka completed the sale of its diamond and industrialinterests to KimCor Diamonds Plc, with Dwyka owning 50.09% of KimCor's issuedequity. Dwyka has since reduced its shareholding in KimCor from 50.09% to 48.2%of KimCor's issued share capital, via the sale of 5,050,000 shares toinstitutional and high net worth clients of Ambrian Partners Limited and StrandPartners Limited. ROUNDING OF AMOUNTS The amounts contained in this Report have been rounded to the nearest $1,000(where rounding is applicable) under the option available to the Company underASIC Class order 98/0100. The Company is an entity to which the class orderapplies. AUDITOR'S INDEPENDENCE DECLARATION Section 307C of the Corporations Act 2001 requires our auditors,PricewaterhouseCoopers, to provide the Directors of the Company with anIndependence Declaration in relation to the review of the half-year financialreport. This Independence Declaration is set out on the following page. Dated at Perth this 14th day of March 2008. Signed in accordance with a resolution of the Directors. M Sturgess Chief Executive Officer For the Auditors Independence Declaration, please follow the following web link: CONSOLIDATED INCOME STATEMENTFOR THE HALF-YEAR ENDED 31 DECEMBER 2007 Half-year Half-year Ended Ended 31 Dec 2007 31 Dec 2006 Notes $'000s $'000s Revenue from continuing operationsOther income 96 82 96 82 Loss on sale of interest in associate (63) -Share of loss of associate using equity method (822) -Other expenses from continuing operationsAdministration (1,817) (1,604)Depreciation (31) (23)Exploration written off - (288)Finance costs - (118) Loss before income tax (2,637) (1,951) Income tax expense - - Loss from continuing operations (2,637) (1,951) Profit/(loss) from discontinued operations 5 12,655 (4,330) Profit/(loss) for half year 10,018 (6,281)Profit/(loss) attributable to members of DwykaResources Limited 10,018 (6,281) Basic profit/(loss) per share (cents) 8.31 (7.33) Diluted profit/(loss) per share (cents) 8.28 (7.33) The above Consolidated Income Statement should be read in conjunction with theaccompanying notes. CONSOLIDATED BALANCE SHEETAS AT 31 DECEMBER 2007 31 Dec 2007 30 June 2007 Note $'000s $'000s CURRENT ASSETSCash and cash equivalents 2,673 4,265Trade and other receivables 157 815Inventories - 456 Total Current Assets 2,830 5,536 NON-CURRENT ASSETSInvestments accounted for using the equitymethod 18,598 -Other financial assets 156 233Property, plant & equipment 119 5,928Exploration, evaluation and miningproperties 11,065 6,579Other - 290 Total Non-Current Assets 29,938 13,030 TOTAL ASSETS 32,768 18,566 CURRENT LIABILITIESTrade and other payables 475 4,460Borrowings - 2,449Provisions 7 212 Total Current Liabilities 482 7,121 NON-CURRENT LIABILITIESBorrowings 443 4,029Provisions - 221 Total Non-Current Liabilities 443 4,250 TOTAL LIABILITES 925 11,371 NET ASSETS 31,843 7,195 EQUITY Contributed equity 3 76,802 65,580Reserves 2,052 (1,356)Accumulated losses (47,011) (57,029) Total parent entity interest 31,843 7,195 TOTAL EQUITY 31,843 7,195 The above Consolidated Balance Sheet should be read in conjunction with theaccompanying notes. CONSOLIDATED STATEMENT OF CHANGES IN EQUITYFOR HALF YEAR ENDED 31 DECEMBER 2007 Half-year Half-year Ended Ended 31 Dec 2007 31 Dec 2006 $'000s $'000s Total equity at beginning of the half year 7,195 18,509 Changes in fair value of available for sale financial assets, (76) 73net of taxExchange differences on translation of foreign corporations (28) (715)Net income recognised directly in equity (104) (642)Profit/(loss) for the half year 10,018 (6,281)Adjustment for prior years losses recouped on minority - (49)interest Total recognised income and expense for the half year 9,914 (6,972) Transactions with equity holders in their capacity as equityholders Contributions of equity, net of transaction costs 11,222 -(note 3) Share based compensation reserve 299 318 Write back of exchange differences relating tosale of foreign discontinued operation 2,638 - Increased equity in subsidiary reserve taken toincome and expense in current period 575 (575) 14,734 (257) Total equity at end of the half year 31,843 11,280 Total recognised income and expense for the half year isattributable to: Members of Dwyka Resources Limited 9,914 (6,972)Minority interest - - 9,914 (6,972) The above Consolidated Statement of Changes in Equity should be read inconjunction with the accompanying notes. CONSOLIDATED CASH FLOW STATEMENTFOR HALF-YEAR ENDED 31 DECEMBER 2007 Half-year Half-year Ended Ended 31 Dec 2007 31 Dec 2006 Note $'000s $'000s CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers (inclusive of GST) 2,446 3,477Payments to suppliers and employees (inclusive of GST) (4,849) (6,146)Interest received 65 98Other income - 104Interest paid (193) (163) Net cash outflow from operating activities (2,531) (2,630) CASH FLOW FROM INVESTING ACTIVITES Payments for plant & equipment (8) (956)Proceeds from sale of plant and equipment - 2Cash disposed of with sale of discontinued operations 5 (229) -Payment for acquisition of subsidiary, net of cash acquired (207) -Cash acquired on acquisition of business unit - 124Payment for acquisition of increased subsidiary interest - (575)Proceeds from sale of associate interest 673 17Payment for exploration/mine development (709) (633) Net cash outflow from investing activities (480) (2,021) CASH FLOWS FROM FINANCING ACTIVITIES Loan to associates - (614)Proceeds from borrowings - 979Repayment of borrowings - (137)Proceeds from issue of shares 1,446 - Net cash inflows from financing activities 1,446 228 Net decrease in cash held (1,565) (4,423) Cash and cash equivalents at the beginning of the reporting 4,265 6,286periodEffect of exchange rate changes on cash and cash equivalents (27) 422 Cash and cash equivalents at the end of the reporting period 2,673 2,285 The above Consolidated Cash Flow Statement should be read in conjunction withthe accompanying notes. NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 31 DECEMBER 2007 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES This general purpose financial report for the interim half-year reporting periodended 31 December 2007 has been prepared in accordance with Accounting StandardAASB 134 Interim Financial Reporting and the Corporations Act 2001. This interim financial report does not include all the notes of the typenormally included in an annual financial report. Accordingly, this report is tobe read in conjunction with the annual report for the year ended 30 June 2007and any public announcements made by Dwyka Resources Limited during the interimreporting period in accordance with the continuous disclosure requirements ofthe Corporations Act 2001. The accounting policies adopted are consistent withthose of the previous financial year and corresponding interim reporting period. SEGMENT INFORMATION Primary reporting format - Geographical segments Discontinued Africa Australia India Unallocated operations ConsolidatedHalf-year 2007 $'000s $'000s $'000s $'000s $'000s $'000s Total segment revenue 32 - - 64 2,495 2,591 Segment result (16) (1,779) - (842) 12,655 10,018 Discontinued Africa Australia India Unallocated operations ConsolidatedHalf-year 2006 $'000s $'000s $'000s $'000s $'000s $'000s Total segment revenue - - - 98 3,545 3,643 Segment result (7) (1,603) (296) (45) (4,330) (6,281) 3. EQUITY SECURITIES ISSUED Movements in equity securities during the half-year period were: Date Details Issue price Number of shares $'000s Half Year 2007 Fully paid ordinary shares1/7/2007 Opening balance 111,579,270 65,5802/7/2007 Employee share plan loan repaid - $0.52 33,334 17 proceeds received18/7/2007 Convertible note conversion $0.74 2,777,778 2,05620/7/2007 Acquisition of subsidiary $1.45* 3,962,757 5,7466/8/2007 Payment of final mine purchase $0.84 2,349,400 1,974 consideration19/9/2007 Employee options exercised $0.52 & $1.00 1,825,000 1,429 31/12/2007 Balance 122,527,539 76,802 * An issue price of $0.434 used to calculate the number of shares that formed the consideration wasset upon entering into a Memorandum of Understanding in February 2007. This MOU was only finalisedin July 2007 and the market price on the date of issue, $1.45, has been used to calculate the issueprice for accounting purposes in accordance with Accounting Standard AASSB3 Employee Share plan shares issued with limited recourse employee loans 1/7/2007 Opening balance 8,000,0012/7/07 Employee share plan loan repaid - shares transferred to ordinary share capital $0.52 (33,334)11/12/2007 Employee share plan issue $0.915 850,000 31/12/2007 Balance 8,816,667 Total ordinary shares on issue 31/12/2007 131,344,206 76,802 3. EQUITY SECURITIES ISSUED (continued) Half Year 2006 Fully paid ordinary shares1/7/2006 Opening balance 85,737,134 56,693 31/12/2006 Balance 85,737,134 56,693 Employee Share plan shares issued with limited recourse employee loans 1/7/2006 Opening balance 7,000,001 - 21/12/2006 Employee share plan $1.00 1,000,000 - issue 31/12/2006 Balance 8,000,001 - Total ordinary shares on issue31/12/2006 93,737,135 56,693 Other equity securities 1/7/2006 Opening balance 219 31/12/2006 Balance 219 31/12/2006 Total contributed equity 56,912 4 BUSINESS COMBINATIONHalf Year 2006Effective from 1 October 2006 the Group completed a Black Economic Empowerment (BEE)transaction with its BEE partner - Kolong Investments Limited. This transaction was enteredinto to ensure all South African operations were classified as BEE compliant under SouthAfrican law. The transaction resulted in Dwyka - increasing its holding in Superkolong Pty Ltd, the owner and operator of the de BeersTailings treatment plant from 40% to 70%; and equipment; and - reducing its interest in the Dwyka Resources industrial business and its various miningassets from 100% to 70%.The initial 40% ownership interest in Superkolong Pty Ltd was acquired on incorporation ofthe company for nominal value.The results of Superkolong Pty Ltd are incorporated into the results of the Group as from 1October 2006. This company contributed $334,318 in revenues and a net loss of $874,731. Ifthe acquisition had occurred on 1 July 2006, the consolidated revenue and consolidated lossfor the half year would have been $518,148 and $6,281,000 respectively.Details of the fair value of the assets and liabilities acquired and goodwill are as follows: AUD $'000sPurchase consideration:Cash paid 347Deferred cash consideration 205Share of subsidiaries net liabilities disposed -Allocated to Biz Africa net assets position (347)Total purchase consideration on acquisition ofSuperkolong 205Fair value of net identifiable liabilities acquired(refer below) (715) Goodwill 920 In the event that the Group does not pay Kolong Investments Limited a ZAR500,000 dividend for each of the 30 June 2008, 30 June 2009, and 30 June 2010periods, the Group shall make a contingent cash payment to Kolong InvestmentsLimited for the difference between the actual dividend paid and ZAR 500,000. Atthe date of this report, the payment of dividends is not probable and futurecash payments have been recognised as deferred cash payments. This goodwill represents future income streams to flow from the DBTR plant,however based on the then current performance of the DBTR plant. This goodwillwas subsequently fully written off in this half year period. The fair value of assets and liabilities acquired are based on discounted cash flow models.No acquisition provisions were created. The assets and liabilities arising from the acquisition are as follows : Carrying amount Fair value $'000s $'000s Cash and cash equivalents 124 124Trade and other receivables 569 569Plant and equipment 6,428 6,428Trade and other payables (75) (75)Non-current payables - unsecured (4,776) (4,776)Non-current payables -secured (2,985) (2,985) Net identifiable liabilities acquired (715) (715) 5 DISCONTINUED OPERATION Description On 21 August 2007 the Company announcement its intention to sell its diamond andindustrial divisions to the AIM listed KimCor Diamonds Plc. This transaction wascompleted with effect from 21 September 2007 and the divisions disposed of arereported in this financial report as discontinued operations. Financial information relating to the discontinued operations for the period tothe date of disposal is set out below. Further information is set out in note 2- segment information. Financial performance and cash flow information The financial performance and cash flow information presented are for the periodended 21 September 2007 (December 2007 column) and the half-year ended 31December 2006. Half year Dec 2007 Dec 2006 $'000s $'000s Revenue 2,495 3,561Expenses (3,835) (7,891)Loss before income tax (1,340) (4,330) Income tax expense - -Loss after income tax of discontinued operations (1,340) (4,330) Gain on sale of the division before income tax 13,995 -Income tax expense - -Gain on sale of the division after income tax 13,995 - Profit/(loss) from discontinued operations 12,655 (4,330) Net cash outflow from operating activities (870) (1,130)Net cash outflow from investing activities (182) (2,280)Net cash inflow from financing activities - 842 Net decrease in cash utilised by discontinued operations (1,052) (2,568) Carrying amounts of assets and liabilities The carrying amounts of assets and liabilities as at 21 September 2007 (December2007 column) and 30 June 2007 are: Consolidated Dec 2007 June 2007 $'000s $'000s Cash 229 427Trade and other receivables 786 729Inventories 606 456Property, plant and equipment 5,327 5,786Exploration, evaluation and mining properties 2,492 2,310Other 298 290Total assets 9,738 9,998 Trade and other payables 1,713 4,018Provisions 832 395Borrowings 3,888 4,229Total liabilities 6,433 8,642 Net assets 3,305 1,356 Details of the sale of the discontinued operations Half year Dec 2007 Dec 2006 $'000s $'000s Consideration received: Value of KimCor Diamonds Plc shares received 20,157 -Total disposal consideration 20,157 -Adjustment of reserves relating discontinued operations (2,857) -Carrying amount of net assets sold (3,305) -Gain on sale before income tax 13,995 - Income tax expense - - Gain on sale after income tax 13,995 - 6 CONTINGENCIES There has been no change in contingent liabilities since the last annual report. DWYKA RESOURCES LIMITED DIRECTORS' DECLARATION In the directors' opinion: the financial statements and notes set out on pages 8 to 17 are in accordancewith the Corporations Act 2001, including: complying with Accounting Standards, the Corporations Regulations 2001 and othermandatory professional reporting requirements; and giving a true and fair view of the consolidated entity's financial position asat 31 December 2007 and of its performance for the half-year ended on that date;and there are reasonable grounds to believe that Dwyka Resources Limited will beable to pay its debts as and when they become due and payable. This declaration is made in accordance with a resolution of the Directors. M Sturgess Chief Executive Officer Dated at Perth, this 14th day of March 2008. For the Independent Auditors Review Report, please follow the following weblink: http://www.rns-pdf.londonstockexchange.com/rns/1076q_1-2008-3-14.pdf http://www.rns-pdf.londonstockexchange.com/rns/1076q_2-2008-3-14.pdf DWYKA RESOURCES LIMITEDAND ITS CONTROLLED ENTITIES CORPORATE DIRECTORY DIRECTORS E NealonT McConnachieM SturgessE KirbyM Langoulant COMPANY SECRETARYM Langoulant REGISTERED OFFICE98 Colin StreetWEST PERTH WA 6005 Telephone: (+61 8) 9324 2955Facsimile: (+61 8) 9324 2977 ADVISER AND BROKERAmbrian Partners Limited8 Angel CourtLondon EC2R 7HPUnited Kingdom AUDITORS PricewaterhouseCoopersQV1250 St. Georges TcePERTH WA 6000AUSTRALIA LAWYERS TO THE COMPANYAustralia:Clayton UtzQV1250 St Georges TcePERTH WA 6000 South Africa:Werksmans Attorneys155 - 5th StreetSandownSandton 2196SOUTH AFRICA SHARE REGISTRY Australia:Computershare Investor Services Pty LtdReserve Bank BuildingLevel 245 St George's TerracePERTH WA 6000 United Kingdom:Computershare Investor Services Pty LtdPo Box 859The PavillionsBridgewater RoadBristol BS99 1XZUNITED KINGDOM ASX CODEShares: DWY AIM CODEShares: DWY This information is provided by RNS The company news service from the London Stock Exchange