Uranium Resources Plc Regulatory News (URA)

19 Dec 2008 15:30



Uranium Resources plc / Market: AIM / Epic: URA / Sector: Exploration

19 December 2008 

Uranium Resources plc ('Uranium Resources' or 'the Company')

Final Results

Uranium Resources plc, the AIM listed uranium exploration and development company, announces its results for the year ended 30 June 2008.

Executive Director's Report 

This has been another year of progress and we were pleased to provide an update on our achievements over the period and the direction in which we are taking the Company.  In the last Annual Report, we set out that 2008 would be a year of corporate reorganisation, targeted exploration and definable growth, and we are pleased to report that we believe we have delivered in all these areas. 

During period under review, the Company continued its exploration programme in tandem with its ASX listed joint venture partner Western Metals Ltd ('Western Metals'), which is primarily focussed on developing the Mtonya, Ruhuhu and Ruvuma uranium licence areas in southern Tanzania.

As part of our growth strategy, we also strengthened the Board with the appointments of Alex Gostevskikh and Andrew Lewis, who as well as assisting in developing our current assets, will help identify additional projects to expand our existing portfolio.

Importantly we also maintain a healthy cash position of £1.12 million at 30 November 2008, which we believe places Uranium Resources plc and its subsidiaries ("Uranium Resources" or "URA") in a strong and stable position going forward.

Exploration

The Company's primary focus has been the exploration of its circa 13,000 km² uranium licence areas in southern Tanzania. The 2008 exploration programme, conducted by our joint venture farm-in partner Western Metals Limited (ASX: WMT), was completed on 15th September with 171 Reverse Circulation ('RC') holes drilled totalling 10,670m.

The programme expanded the area of uranium mineralisation around the Henri trend at the Mtonya project and continued to evaluate prospects along the Mtonya Corridor, including the Grandfather prospect. In addition they identified two new areas of uranium mineral interest, Foxy and Eland at the Ruvuma Project and a further anomaly, Pedro at the Ruhuhu Project, which will be assessed during the 2009 drilling programme scheduled to commence during the 2nd quarter.

Encouragingly, Western Metals has achieved its farm-in target by spending AU$4million on exploration on the farm-in tenements and accordingly has earned a 60% interest in those tenements.

Mtonya Project

The focus of the 2008 drilling programme was the continued evaluation of prospects along the Mtonya Corridor in particular Grandfather, Rufus, Henri and Para Extended.

152 RC holes were drilled for a total of 9,288m into prospects along the Mtonya Corridor. Infill and extension drilling at known prospects such as Moysten, Para, Tahbilk and Henri have confirmed tenor and extended mineralisation. Encouragingly, drilling at these prospects has returned a number of significant intercepts.

Of particular interest was hole MRC235, drilled in an area of relatively low surface radiometric response between the Tahbilk and Moysten Prospects, which returned 2m at 1,320 ppm U3O8 from 36 metres. Follow up of this new anomaly will be undertaken as part of the 2009 exploration programme.

Significant intercepts from results received to date from 2008 RC drilling include:

Ruvuma Project

The Ruvuma licence area spans circa 10,200 sq km, predominantly over areas of the Karoo Basin and hosts sediments similar to the Company's Mtonya Project as well as Paladin's Kayelekera Operation 300km to the west in Malawi. The geology of the region is analogous to Paladin's Kayelekera and the Mtonya Project.

As part of the Company's 2008 exploration programme, a detailed geological mapping, ground geophysical and geochemical survey was undertaken, which returned encouraging results. 

At the Foxy Prospect, 19 RC holes were drilled for a total of 1,382m. Initial indications from downhole geophysical logging are that a number of holes intersected shallow, low-moderate grade uranium mineralisation.

At Eland, detailed ground radiometric and spectrometric readings were completed at the discovery site. In addition, traverses were made to the south-west to locate anomalous areas indicated on the 'informal' total count heli-borne survey carried out in 2007. Grab samples were collected from hotspots as well as a range of type samples. The radiometric data shows a clear 300 counts per second total count (Geogammer) anomaly (150 x 30m in size) along the north-east margin of the hill. The anomaly is located along the contact between equigranular syenite and a melange of syenitic rock and frosted felsic gneiss. The anomaly continues to the south-east into a zone of syenitic rubble and soil cover. Preliminary geological scout maps were also made of both the discovery area at Eland Hill and along traverses away from the hill. Reconnaissance traverses to the south-west resulted in the discovery of several patches with uranium hotspots associated with nepheline syenite and frosted altered gneiss. In addition, the outcrop was generally scattered with boulder sub-crop. 

A number of rock chip samples taken from the Eland environs returned anomalous uranium, tantalum and niobium values. Of particular interest is the fact that this 'hard rock' style of mineralisation has similarities to other deposits located in Namibia and Malawi. Significant results included:

Ruhuhu Project

The 2008 drill programme was designed to include evaluation of regional prospects such as the Pedro project at Ruhuhu, however access issues prevented drill evaluation of the Pedro prospect. These and other prospects will be assessed during the 2009 drill programme which is scheduled to commence during the 2nd quarter of 2009. 

Operating agreements and ownership of tenements

As at 30 June 2008, the Group had three joint operating agreements covering licences for exploration of uranium and related minerals in a land area of 13,553 km2 in southern Tanzania. Under each operating agreement, each participant (i.e. partner) in the agreement accounts for its proportionate share of costs, revenues, assets and liabilities of joint arrangements, except that the local partner's share of costs is borne equally by the other two main partners. The two main partners in the joint operating agreements are Uranium Resources plc and its subsidiaries and Western Metals Limited ("Western Metals"). The three operating agreements can be summarised as follows:

* Under the Farm-in project, Western Metals was required to spend AU$2 million to earn 40% and a further AU$2 million to earn a further 20% interest in the project. URA was free carried until AU$4 million was spent by Western Metals.  By the year end, Western Metals had spent the required AU$4 million and acquired a 60% interest in the project. Since the year end, both URA and Western Metals have been contributing their proportionate share of costs on the project.

** In the case of these projects, the share of costs of the local partner is borne equally by URA and Western Metals

Western Metals carries out the exploration programme on behalf of the joint venture and invoices Uranium Resources for its share of these costs as well as administrative expenses. Uranium Resources pays 70% of the estimated costs at the beginning of each quarter. The remainder, which is based on actual costs relating to that period, is billed at the beginning of the next quarter.

Board Appointments

As part of our growth strategy, we strengthened the management team with the appointment of a new Managing Director, Mr. Alex Gostevskikh, and a new Non-executive Director, Mr. Andrew Lewis. Alex and Andrew have previously developed and operated globally significant mining projects and bring a wealth of experience across a range of commodities. Both Alex and Andrew will help Uranium Resources pursue its objectives of growing the Company through the advancement of its current project portfolio in southern Tanzania and identifying further targets to expand the existing asset base. We believe that the current uncertainties in the global markets provide opportunities for companies such as Uranium Resources, which have experienced management teams to take advantage of opportunistic acquisitions and in turn build shareholder value.

Financial results

In line with our expectations, the Group is reporting a loss of £60,656 for the year ended 30 June 2008. We are an exploration company and as such we are not producing revenue. We are well capitalised with a net cash position of £1,810,971 at 30 June 2008 and £1,123,570 at 30 November 2008.

Strategy and Future Direction

Throughout the period under review, the Company retained a strong cash position, which places it in a solid position to advance its existing uranium projects in southern Tanzania and to generate and develop new opportunities going forward. 

Uranium Resources strategy is to build upon its exploration successes and to fast track its three uranium projects, Mtonya, Ruvuma and Ruhuhu to a resource stage to realise their economic potential. Additionally, the Company is looking to identify a number of mid size precious metal targets with short development cycle requirements to expand its asset base and core offering.

The principal premise for the Company's growth is being opportunistic and open-minded, seeking high-quality early-stage opportunities that deliver the optimal combination of a cost value timeframe. A number of jurisdictions and opportunities that would complement the Company's existing portfolio are currently under review, where Uranium Resources would either seek partnerships with senior companies or pursue development independently.

During the year we have seen many positive developments for the Company. With a strengthened management team, a solid portfolio of projects being advanced with our JV partner, a clear strategy to increase the Company's asset base and a healthy cash position, We are confident that our success will continue and that the future of Uranium Resources is bright.

Availability of report and accounts

Copies of the audited report and accounts will be available from the Company's registered office at, One America Square, Crosswall, London EC3N 2SG, United Kingdom and will be posted to shareholders on 23rd December 2008.

Annual General Meeting 

The Company's Annual General Meeting will be held at the offices of Sprecher Grier Halberstam LLP, 5th Floor, One America Square, Crosswall, London EC3N 2SG on Friday 30th January 2009 at 3.00 pm.  The Notice of the Meeting, which sets out the resolutions to be proposed, accompanies the Annual Report and Accounts

Signed on behalf of the Executive Directors by:

Ross Warner

Director

18 December 2008 

**ENDS**

For further information please visit www.uraniumresources.co.uk or contact:

Consolidated Income Statement

for the year ended 30 June 2008

The results shown above related entirely to continuing operations.

Consolidated Statement of Changes in Equity 

for the year ended 30 June 2008

Consolidated Balance Sheet 

As at 30 June 2008

Consolidated Cash Flow Statement

For The Year Ended 30 June 2008

Notes to the Final Results Announcement

For the Year Ended 30 June 2008

General information

Uranium Resources plc is a public limited company listed on the Alternative Investment Market ("AIM") of the London Stock Exchange and incorporated in England.

On 1 July 2007, in accordance with the rules of the AIM market, the Group adopted International Financial Reporting Standards, as adopted by the European Union ("IFRS"). The Group's financial statements for the year ended 30 June 2008, from which this financial information has been extracted, and for the comparative year ended 30 June 2007, are prepared on a going concern basis and in accordance with IFRS, including IFRS 6 "Exploration for and Evaluation of Mineral Resources" and in accordance with those parts of the Companies Act 1985 applicable to companies reporting under IFRS.

As this is the first year in which the Group has prepared its financial statements under IFRS, the comparatives have been restated from UK Generally Accepted Accounting Practice ("UK GAAP") to comply with IFRS. At the half yearly results release, the Group issued its half yearly IFRS financial information for 2007 and the reconciliations to IFRS from previously published UK GAAP financial statements. These are summarised in a note to the Group's statutory financial statements for the year ended 30 June 2008.

The financial information contained in this announcement does not constitute full statutory accounts within the meaning of Section 240 of the Companies Act 1985. The figures are extracted from the audited financial statements for the year ended 30 June 2008, which will be filed with the Registrar of Companies, sent to shareholders and will be available on the Company's website at www.uraniumresources.co.uk. This announcement, including the Group's consolidated financial information, was authorised for issue by the board of directors and agreed with the auditors on 18 December 2008.

The comparative figures for the year ended 30 June 2007 are not the statutory accounts for that financial period. Those accounts, which were prepared under UK GAAP, have been reported on by the Company's auditors and delivered to the Registrar of Companies. The report of the auditors was (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under Section 237(2) or (3) of the Companies Act 1985.

These financial statements consolidate the accounts of Uranium Resources plc and all its subsidiary undertakings draw up to 30 June each year.

The principal accounting policies applied in the preparation of these financial statements are set out below.

These policies have been applied to all years presented, unless otherwise stated below.