9 Feb 2011 09:00
CONSOLIDATED GENERAL MINERALS PLC
UNAUDITED INTERIM FINANCIAL STATEMENTS
FOR THE SIX MONTH PERIOD ENDED
31 DECEMBER 2010
Consolidated General Minerals announces its unaudited interim financial results for the six month period ended 31st December 2010.
Highlights
·; Cash position and net assets as at 31st December 2010 amounted to respectively US$ 21.1 million (June 30, 2010: US$ 22.0 million) and US$ 20.9 million (June 30, 2010: US$ 22.0 million); ·; The Company has no long term debts or borrowings; ·; The Guarantee and Warranties associated with the disposal of Company's mining interest in China expired without any claimshaving been made; ·; As notified on 30th September 2010 the Company's shares were suspended from trading on AIM. In the event the Company is unable to complete an acquisition by 31st March 2011, the admission of its ordinary shares to AIM will be cancelled and it will not be subject to the AIM Rules for Companies thereafter; and ·; At the Company's AGM on 16th December 2010 the shareholders approved the Company's new Investing Policy. |
For further information contact:-
Consolidated General Minerals plc
Robert Adair (Chairman) +44 7872 930 114
Jean-Pierre Conrad (Executive) +41 79 601 51 59
Marinko Vidovich (Non-executive) +61 8 6216 5200
Brewin Dolphin Ltd (Nomad)
Alex Dewar +44 131 529 0276
Chairman's Statement
As announced in the latter part of 2010, we have evaluated a number of investment propositions but were unable to muster sufficient shareholder support for any particular proposition in time to complete an acquisition prior to the 29th September 2010 deadline set by the AIM Rules. As a result, trading in the Company's shares on AIM was suspended on the 30th September 2010. In the event that the Company is unable to complete an acquisition by 31st March 2011 the admission of its ordinary shares to AIM will be cancelled.
In November 2010 the Company announced the resignation of Frank Vanspeybroeck as a Director with immediate effect and thereafter, it was notified that Jean-Pierre Conrad, Nicolas Rouveyre and Ambrian Capital plc had acquired an aggregate 26.7% interest in the Company.
The Board consulted with and took into account the views of certain of the Company's larger shareholders, and together with Mr Conrad, prepared an amended investing policy. Mr Conrad was appointed to the Board in November 2010, the appointment being approved by shareholders at the AGM in December 2010. We believe that the new shareholders and the Board have extensive industry and sector insight with local relationships across the world, experience in the areas of corporate finance, commodity trading and technical issues that will providethe means to implement the Company's new investing strategy.
The Company has entered into a service agreement with Ambrian Resources AG based in Zug Switzerland. This agreement provides for certain support functions mostly of an administrative nature to be conducted at cost for the benefit of the Company. In addition, executive time such as, but not limited to, Mr Conrad's full time allocation to the Company is provided for a fee. The Company believes that at this stage of its development, this agreement represents the most cost effective way of managing its activities. At board level reductions in remuneration have been made: also reductions have been made by certain of the Company's suppliers. This will hopefully translate in a material reduction in overheads, especially important during this transitory period.
Ambrian Resources AG is a subsidiary of Ambrian Capital plc, a significant shareholder in the Company. Mr Conrad, a director and a significant shareholder in the Company is also a director of Ambrian Resources AG. As a consequence this agreement is deemed to be a related party transaction for the purposes of the AIM Rules. MarinkoVidovich and I, both of whom are independent parties to the Agreement, consider, having consulted with the Company's Nominated Adviser, that the terms of the agreement are fair and reasonable.
The Company's investing policy is to create shareholder value by identifying and acquiring holdings in businesses and ventures active in natural resources with a particular focus on the minerals (including industrial minerals) and metals sectors. With a strong emphasis on downside protection, the strategy of the Company will look to focus on investments:
·; That demonstrate an ability to generate near term or immediate cash flows; ·; That demonstrate a high degree of resilience throughout cycles; ·; In sectors benefiting from industry consolidation; ·; In businesses which can benefit from our commodity trading experience, financing, industry and technical know-how; and ·; That are not grassroot exploration. |
The Company intends to be an active investor in its ventures. These will include but are not limited to:
·; Funding of brownfield developments in conjunction with expanding and/or rehabilitating existing operations; ·; Purchasing significant interests in existing businesses; ·; Participating in the recapitalisation of existing operations; and ·; Funding late stage greenfield developments. |
We have not entered into any commitment in connection with any investments or acquisitions yet. We are however reviewing business proposals that could result in a possible transaction or a series of transactions. Our objective remains to implement before 31st March 2011 a transaction that will derive short term benefits from the deployment of the Company's funds as well as restore trading in the Company's shares without incurring the costs associated with seeking a re-admission to AIM at a later time. Notwithstanding the foregoing, our shareholders should always bear in mind that the benefits of an immediate listing will never outweigh poor business judgment in the conduct of the Company's business such as that which could be dictated by time constraints!
A key objective during most of the six month period under review was to protect the Company's assets from claims under the Guarantee and Warranties that were given to Cosmos Castle Management Limited as part of the disposal of Hunan Westralian Resources Pty Ltd. To this end it was gratifying that the Company received its due consideration, and that the Guarantee and Warranties have expired without any claim being made against them. The Board would like to acknowledge its thanks and appreciation to the staff and in particular to Mr Marinko Vidovich for their unwavering commitment in downsizing expeditiously the operations and corporate functions of the Company. As a consequence, all operations and corporate functions carried out in China and Australia have been terminated and associated costs eliminated. In the future, the Company's corporate functions will be managed out of Switzerland (as more fully explained herein) with a clear mandate from the Board to minimize costs especially whilst the Company has not acquired an operating business.
We look forward to what we believe will be an exciting period for the Company as we pursue our new investing strategy.
Robert F.M. Adair
Chairman of the Board
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE HALF-YEAR ENDED 31 DECEMBER 2010 |
Note | Six Months Ended 31 December 2010 US$'000 Unaudited | Six Months Ended 31 December 2009 US$'000 Unaudited | Year Ended 30 June 2010 US$'000 Audited | |
CONTINUING OPERATIONS | ||||
Salaries and employee benefits | (166) | (362) | (251) | |
Office expenses and professional fees | (503) | (1,162) | (779) | |
Consulting expenses | (306) | (293) | (623) | |
Travel and accommodation expenses | - | (160) | - | |
Other expenses | - | (213) | - | |
OPERATING LOSS | (975) | (2,190) | (1,653) | |
Other gains and losses | 30 | 4,922 | (1,027) | |
Financial income | 14 | 4 | 72 | |
PROFIT/(LOSS) BEFORE TAX | (931) | 2,736 | (2,607) | |
Tax | 2 | - | - | - |
PROFIT/(LOSS) FOR THE PERIOD FROM CONTINUING OPERATIONS | (931) | 2,736 | (2,607) | |
DISCONTINUED OPERATIONS | ||||
Profit/(loss) for the period from discontinued operations | 4 | (227) | 349 | (289) |
PROFIT/(LOSS) FOR THE PERIOD | (1,158) | 3,085 | (2,897) | |
OTHER COMPREHENSIVE LOSS | ||||
Exchange differences on translation of foreign operations | - | (3,611) | (4,095) | |
Exchange gain recognised on disposal of foreign operations | - | (4,935) | (148) | |
OTHER COMPREHENSIVE LOSS FOR THE PERIOD (NET OF TAX) | - | (8,546) | (4,243) | |
TOTAL COMPREHENSIVE LOSS FOR THE PERIOD | (1,158) | (5,461) | (7,139) | |
Profit/(loss) for the period attributable to: | ||||
Owners of Consolidated General Minerals plc | (1,158) | 3,085 | (2,260) | |
Non-controlling interests | - | - | (637) | |
(1,158) | 3,085 | (2,897) | ||
Total comprehensive loss attributable to: | ||||
Owners of Consolidated General Minerals plc | (1,158) | (5,461) | (6,509) | |
Non-controlling interests | - | - | (630) | |
(1,158) | (5,461) | (7,139) | ||
From continuing and discontinued operations | ||||
Basic and diluted earnings/(loss) per share (cents) | 3 | (0.5) | 6.4 | (4.7) |
From continuing operations | ||||
Basic and diluted earnings/(loss) per share (cents) | 3 | (1.9) | 5.6 | (5.4) |
CONSOLIDATED STATEMENT OF CHANGES IN equity FOR THE HALF YEAR ENDED 31 DECEMBER 2010 |
| Attributable to Members of Consolidated General Minerals | |||||||
Share Capital US$'000 | Share Premium Reserve US$'000 | Foreign Exchange Reserve US$'000 |
Other Reserves US$'000 |
Retained Earnings US$'000 |
Total US$'000 | Non-controlling interest US$'000 |
Total Equity US$'000 | |
Balance at 1 July 2009 | 920 | 66,170 | 4,249 | 61 | (42,875) | 28,525 | (12) | 28,513 |
Profit for the half-year | - | - | - | - | 3,085 | 3,085 | - | 3,085 |
Other comprehensive loss: | ||||||||
Exchange differences on translation of foreign operation | - | - | (3,611) | - | - | (3,611) | - | (3,611) |
Realisation of reserves on disposal of foreign operations | - | - | (4,935) | - | - | (4,935) | 12 | (4,923) |
Total comprehensive loss for the period | - | - | (8,546) | - | 3,085 | (5,461) | 12 | (5,449) |
Balance at 31 December 2009 Unaudited | 920 | 66,170 | (4,297) | 61 | (39,790) | 23,064 | - | 23,064 |
Loss for the half-year | - | - | - | - | (5,345) | (5,345) | (637) | (5,982) |
Other comprehensive loss: | ||||||||
Exchange differences on translation of foreign operation | - | - | (490) | - | - | (490) | (6) | (496) |
Realisation of reserves on disposal of foreign operations | - | - | 4,787 | - | - | 4,787 | - | 4,787 |
Total comprehensive loss for the period | - | - | 4,297 | - | (5,345) | (1,048) | (643) | (1,691) |
Reverse acquisition loss recognised on disposal of GRV | - | - | - | (61) | 61 | - | - | - |
De-recognition of non-controlling interest on sale of Westralian | - | - | - | - | - | - | 643 | 643 |
Balance at 30 June 2010 Audited | 920 | 66,170 | - | - | (45,074) | 22,016 | - | 22,016 |
Loss for the half-year | - | - | - | - | (1,158) | (1,158) | - | (1,158) |
Total comprehensive loss for the period | - | - | - | - | (1,158) | (1,158) | - | (1,158) |
Balance at 31 December 2010 Unaudited | 920 | 66,170 | - | - | (46,232) | 20,858 | - | 20,858 |
CONSOLIDATED STATEMENTS OF FINANCIAL POSITIONAS AT 31 December 2010 |
31 December 2010 US$'000 Unaudited | 31 December 2009 US$'000 Unaudited | 30 June 2010 US$'000 Audited | |
NON-CURRENT ASSETS | |||
Property, plant and equipment | - | 47 | - |
- | 47 | - | |
CURRENT ASSETS | |||
Trade and other receivables | 61 | 3,050 | 276 |
Cash and cash equivalents | 21,146 | 21,032 | 21,975 |
21,207 | 24,082 | 22,251 | |
TOTAL ASSETS | 21,207 | 24,129 | 22,251 |
CURRENT LIABILITIES | |||
Trade and other payables | (349) | (1,065) | (235) |
TOTAL LIABILITIES | (349) | (1,065) | (235) |
NET ASSETS | 20,858 | 23,064 | 22,016 |
EQUITY | |||
Share capital | 920 | 920 | 920 |
Share premium account | 66,170 | 66,170 | 66,170 |
Foreign exchange reserve | - | (4,297) | - |
Other reserves | - | 61 | - |
Retained earnings | (46,232) | (39,790) | (45,074) |
TOTAL EQUITY | 20,858 | 23,064 | 22,016 |
CONSOLIDATED STATEMENTS OF CASHFLOWS FOR THE HALF-YEAR ENDED 31 DECEMBER 2010
| |||||
Six Months Ended 31 December 2010 US$'000 Unaudited | Six Months Ended 31 December 2009 US$'000 Unaudited | Year Ended 30 June 2010 US$'000 Audited | |||
Operating loss | (975) | (3,503) | (1,653) | ||
Adjustments for: | |||||
Depreciation | - | 237 | 768 | ||
Discontinued operations | (227) | - | (289) | ||
Net exchange differences | (551) | (2,257) | (720) | ||
Operating cash flows before movements in working capital, net of effects from sale of subsidiaries | (1,753) | (5,523) | (1,894) | ||
(Increase)/decrease in trade and other receivables | 219 | (106) | (1) | ||
Decrease in inventories | - | - | 1,247 | ||
(Decrease)/increase in trade and other payables | 108 | (151) | (3,206) | ||
Net cash outflow from operating activities | (1,426) | (5,780) | (3,855) | ||
INVESTING ACTIVITIES | |||||
Proceeds on sale of subsidiaries, net of cash disposed | - | 21,103 | 23,382 | ||
Purchases of property, plant and equipment | - | (81) | (81) | ||
Payments for licences, exploration and development expenditure | - | (235) | (3,300) | ||
Interest received | 14 | 5 | 72 | ||
Net cash inflow/(outflow) from investing activities | 14 | 20,792 | 20,073 | ||
Net increase/(decrease) in cash and cash equivalents | (1,412) | 15,012 | 16,218 | ||
Cash and cash equivalents at the beginning of the period | 21,975 | 6,192 | 6,192 | ||
Movements in foreign exchange rate | 583 | (172) | (436) | ||
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD | 21,146 | 21,032 | 21,975 | ||
Notes to the CONSOLIDATED financial STATEMENTS
NOTE 1: GENERAL INFORMATION
The financial information set out in this report does not constitute full accounts for the purposes of Section 434 of the Companies Act 2006. The interim accounts for the six months ended 31 December 2010 and 31 December 2009 are unaudited. The comparative figures for the financial year ended 30 June 2010 are not the Company's statutory accounts for the financial year but are abridged from those accounts which have been reported on by the Company's auditors, whose report on the consolidated financial statements prepared under International Financial Reporting and Accounting Standards, was unqualified. The interim accounts have been prepared on the basis of the accounting policies set out in the annual financial statements of the Group for the year ended 30 June 2010, except for the impact of the adoption of the Standards and Interpretations described below.
IAS 1 (revised 2007) Presentation of Financial Statements (effective for annual periods beginning on or after 1 January 2010). The revised Standard has introduced a number of terminology changes (including revised titles for the condensed financial statements) and has resulted in a number of changes in presentation and disclosure. However, the revised Standard has had no impact on the reported results or financial position of the Group.
NOTE 2: TAXATION
No liability to tax is expected to have arisen during this period.
NOTE 3: EARNINGS PER SHARE
The calculation of the earnings/(loss) per share is based on the following data:
Six Months Ended 31 December 2010 US$'000 Unaudited | Six Months Ended 31 December 2009 US$'000 Unaudited | Year Ended 30 June 2010 US$'000 Audited | |
Profit/(loss) from continuing operations | |||
Earnings for the purposes of basic and diluted earnings per share being net profit attributable to equity holders of the parent | (931) | 2,736 | (2,607) |
Profit/(loss) from continuing and discontinued operations | |||
Earnings for the purposes of basic and diluted earnings per share being net profit attributable to equity holders of the parent | (1,158) | 3,085 | (2,260) |
|
Six Months Ended 31 December 2010 |
Six Months Ended 31 December 2009 |
Year Ended 30 June 2010 |
Number of shares | |||
Weighted averge number of ordinary shares for the purposes of basic and diluted earnings per share | 48,475,411 | 48,475,411 | 48,475,411 |
The above figures are not affected by any dilutive share options as no share options have been issued in the period.
NOTE 4: DISCONTINUED OPERATION
Prior Period
(a) Description
On 26 August 2009 the Company's 100% owned subsidiary, Global Resources Ventures Limited ("GRV"), signed a Share Purchase Agreement with Cosmos Castle Management Limited, a company incorporated in the British Virgin Islands, to sell all of the issued securities of Westralian Resources Pty Ltd ("Westralian"). Settlement of the sale occurred on 29 September 2009, from which date Westralian and its 80% owned subsidiary Hunan Westralian Mining Co. Ltd ceased to be consolidated into the Group.
On 12 May 2010 GRV was placed in voluntary administration, from which date GRV ceased to be consolidated into the Group. Prior to GRV being liquidated all outstanding loan balances were forgiven by CGM, which resulted in the writing off of all remaining loan balances.
Financial information relating to the discontinued operations for the period to the respective dates of disposal isset out below.
(b) Financial performance and cash flow information
Six Months Ended 31 December 2010 US$'000 Unaudited | Six Months Ended 31 December 2009 US$'000 Unaudited | Year Ended 30 June 2010 US$'000 Audited | |
Revenue | - | - | - |
Expenses | (227) | (1,313) | (3,822) |
Operating loss | (227) | (1,313) | (3,822) |
Foreign exchange (losses)/gains | - | (1) | 3,936 |
Financial income | - | - | 4 |
Profit/(loss) before income tax | (227) | (1,314) | 118 |
Income tax expense | - | - | - |
Profit/(loss) after income tax expense of discontinued operations | (227) | (1,314) | 118 |
Gain/(loss) on deconsolidation of subsidiaries before income tax | - | 1,663 | (408) |
Income tax expense | - | - | - |
Gain/(loss) on deconsolidation of subsidiaries after income tax | - | 1,663 | (408) |
Profit/(loss) from discontinued operations | (227) | 349 | (289) |
Net cash outflow from ordinary activities | (19) | (1,314) | (2,316) |
Net cash inflow/(outflow) from investing activities | - | 20,787 | 1,205 |
Net increase/(decrease) in cash generated by the discontinued operations | (19) | 19,473 | (1,111) |
(c) Details of the sale of subsidiaries
Period Ended 30 September 2010 US$'000 Unaudited | Six Months Ended 31 December 2009 US$'000 Unaudited | Year Ended 30 June 2010 US$'000 Audited | |
Consideration received or receivable: | |||
Net cash (after costs of disposal) on sale of Westralian | - | 21,589 | 23,867 |
Net cash on liquidation of GRV | - | - | 125 |
Amount held on trust until 31 December 2009 | - | 2,128 | - |
Total disposal consideration | - | 23,717 | 23,992 |
Carrying amount of net assets sold of Westralian | - | (23,748) | (23,748) |
Carrying amount of net assets disposed of GRV | - | - | (156) |
Recognition of foreign exchange reserve on sale of Westralian | - | 1,694 | 5,152 |
Recognition of foreign exchange reserve on deconsolidation of GRV | - | - | (5,005) |
Recognition of non-controlling interest on sale of Westralian | - | - | (643) |
Gain on sale and deconsolidation before income tax | - | 1,663 | (408) |
Income tax expense | - | - | - |
Gain on sale and deconsolidation after income tax | - | 1,663 | (408) |
At 30 June 2009 the carrying value of Mining Properties and other consolidated assets were impaired to reflect the disposal of the subsidiaries. A total write-down of US$18,388,341 was recognised against the Mining Properties of the disposed subsidiaries, with the amount reported below being net of this impairment.
The carrying amounts of assets and liabilities at the date of sale (Westralian 29 September 2009)/deconsolidation (GRV 12 May 2010) were:
Date of Sale / Deconsolidation US$'000 Unaudited | ||
Sale of Westralian: | ||
Cash | 486 | |
Trade and other receivables | 442 | |
Plant and equipment | 2,130 | |
Mining properties | 22,726 | |
Total assets | 25,784 | |
Trade and other liabilities | (2,035) | |
Total liabilities | (2,035) | |
Net assets of Westralian | 23,749 | |
Liquidation of GRV: | ||
Cash | 148 | |
Trade and other receivables | 10 | |
Total assets | 158 | |
Trade and other liabilities | (2) | |
Total liabilities | (2) | |
Net assets of GRV | 156 |
NOTE 5: CONTINGENCIES
There has been no change in contingent liabilities or contingent assets since the last annual reporting date.
NOTE 6: SUBSEQUENT EVENTS
No matter or circumstance has arisen since 31 December 2010, which has significantly affected, or may significantly affect the operations of the group, the result of those operations, or the state of affairs of the group in subsequent financial years.