Interim Results

Goldplat plc, the AIM listed gold producer, announces its interim results for the six months ended 31 December 2015.

Overview

  • Return to net profitability with a profit before tax of £395,000 for the six months ended 31 December 2015 (6 months 2014: loss of £377,000)
  • Primary gold recovery operations in South Africa and Ghana both cash flow positive
  • Overall gold production for the six month period was 17,457 ounces (FY 2015: 30,525 ounces)
  • 17,875 ounces total gold sold / transferred (FY 2015: 24,904 ounces)
  • A significant JORC compliant resource of 81,959 ounces of gold with additional silver and uranium oxide upside has been identified in the tailings facility at gold recovery operation in South Africa - work underway to determine optimal production and processing methods to optimise value
  • Expansion and development plans underway at Kilimapesa Gold Mine in Kenya to alleviate project losses going forward
  • Results underpin the success of Goldplat's turnaround strategy - additional capital projects planned to retain more of the value in-house and further increase profitability

Chairman's Statement

I am delighted to report that Goldplat has returned to net profitability during the period under review.  Our portfolio of core assets consists of two gold recovery operations recovering gold from by-products of the mining process in South Africa and Ghana, and the Kilimapesa gold mine in Kenya. 

I am pleased to say that the turnaround strategy put into place in the previous year to address various issues, as well as to make Goldplat more profitable in the continued low gold price environment, has progressed well during this interim period and is starting to deliver the desired outcomes and benefits.  Risks associated with reliance on a single refinery have been mitigated, and elution throughput capacity at Goldplat Recovery (Pty) Ltd in South Africa has been increased to in excess of eight tonnes per day. Numerous capital projects, all funded internally and critical to the turnaround, have been successfully completed and backlog stocks have largely been processed. The problems relating to Rand Refinery, which resulted in the inability to process certain materials, significant backlog stock build-up, consequential reduced new deliveries from numerous clients, and a significant reduction in cashflow and profitability, are now behind us.  The primary recovery operations are both cashflow positive and profitable.

With regard to our financial performance, I am pleased to report a profit before tax of £395,000 for the six months ended 31 December 2015 (a turnaround from a loss before tax of £796,000 for FY2015 and a loss of £377,000 for the six month period ended 31 December 2014). At the operating level the profit was £261,000 (compared to a loss of £711,000 for FY 2015 and a loss of £827,000 for the six months ended 31 December 2014). Cash and cash equivalents at the end of the period stood at £729,000 (compared to £630,000 at end of FY 2015 and £643,000 at the end of December 2014).

With regard to group production and sales, overall gold production for the six month period ended 31 December 2015 was 17,457 ounces (compared to 30,525 ounces of gold in FY 2015) and significantly, total gold sold / transferred for the period was 17,875 ounces (compared to 24,904 ounces in FY 2015). This demonstrates not only increased levels of production, but increased sales and a turnover in stocks. The following table summarises gold production, transfers and sales for the period per operation:

Goldplat Plc Consolidated 31 December 2015
kg
31 December 2015
oz
Year ended 30 June 2015 total kg Year ended 30 June 2015 total oz
Total gold production        
Gold Recovery Ghana 146 4,694 190 6,111
Kilimapesa Gold 29 932 71 2,278
Goldplat Recovery 368 11,831 688 22,135
Total 543 17,457 949 30,525
Gold Sold        
Gold Recovery Ghana 175 5,626 80 2,578
Kilimapesa Gold 29 932 64 2,073
Goldplat Recovery 255 8,198 514 16,530
Total 459 14,756 658 21,181
Metal Transfers to clients        
Goldplat Recovery 97 3,119 116 3,723
Total 97 3,119 116 3,723
Total sold/transferred        
Gold Recovery Ghana 175 5,626 80 2,578
Kilimapesa Gold 29 932 64 2,073
Goldplat Recovery 352 11,317 630 20,253
Total 556 17,875 774 24,904

Goldplat Recovery (Pty) Ltd ('GPL'), South Africa

The focus at GPL for the period was the completion of a number of capital projects - the most important of which were the installation and commissioning of a 4-tonne elution column and associated equipment, and the depletion of the backlog of stock accumulated as a result of the Rand Refinery issues. I am pleased to report success on these initiatives.

Significant capital projects commissioned during the period, all of which were funded internally, include the installations of a new electric boiler; a new woodchip wash plant; a replacement mill in the low grade circuit; a new pumping station for the tailings treatment plant; a cyanide storage facility; the aforementioned 4-tonne elution column; an on-site weighbridge, and a carbon regeneration kiln.  All of these projects represent either the necessary replacement of critical infrastructure and equipment, or new installations which make the operations more efficient and allow GPL to retain more of the value chain which had previously been lost to downstream third parties.

Gold production at GPL for the six month period ended 31 December 2015 was 11,831 ounces of gold (compared to 22,135 ounces for FY 2015) with gold sales/transferred of 11,317 ounces for the period (compared to 20,253 for FY 2015). These results are particularly pleasing considering that the new elution capacity only came into production towards the end of the period, and that significant attention was given to processing material from Goldplat Recovery Ghana ("GRG").

The highlight of the period was the successful installation and commissioning of the 4-tonne elution column. As previously reported a used plant consisting of three 4-tonne elution columns and associated equipment was acquired from DRD Gold Limited during FY 2015, with the first column being successfully installed and commissioned at GPL during the six month period ended 31 December 2015. This has increased elution throughput from approximately 1.5 tonne per day to in excess of 8 tonnes per day. Not only has this enabled the rapid reduction of backlog stocks, but has provided the flexibility and capacity to procure and process additional sources of material from within South Africa and internationally.

During the period a Competent Person was engaged to complete a JORC-compliant Resource Statement for the Tailings Storage Facility at GPL.  In January 2016 a total resource of 81,959 ounces of gold, 216,094 ounces of silver and 193,276 pounds of U3O8 (uranium oxide) was declared.  Work is underway to determine the optimal production method, recovery process, final tailings deposition facility and costs associated with re-processing this material.

Goldplat Recovery Ghana ('GRG'), Ghana

For the six month period ended 31 December 2015, GRG was limited to a single revenue stream (fine carbon). As a result of the Rand Refinery problems a significant increase in stock was built up in Ghana, resulting in payments to clients being delayed, pending treatment, and clients in turn delaying additional deliveries. In October 2015 GRG entered into a pre-payment agreement with Auramet International LLC to accelerate receipt of funds due from Aurubis Refinery in December 2015. This enabled GRG to accelerate payments to material suppliers in Ghana and in return facilitate the receipt of new material from these suppliers. This transaction was concluded successfully and GRG may enter into similar transactions in the future, as and when required.

Significant progress has been made during the period with respect to the restoration of production volumes as well as the depletion of stocks.  Production for the six months to 31 December 2015 was 4,694 ounces of gold (compared to a total of 6,111 ounces of gold during FY2015 and 2 964 ounces of gold for the six months to 31 December 2014).  Gold sold during the period amounted to 5,626 ounces (compared to 2,578 ounces during FY2015 and 1,242 ounces for the six months to 31 December 2014).

The CIL circuit is currently being dismantled and containerised for shipment to Kilimapesa in Kenya. This will free up space on the constrained site in Tema, Ghana for the potential expansion of other revenue streams. Plans for the final rehabilitation of the tailings deposition dam (which had reached capacity and was the reason for the cessation of the CIL process) have been completed with work planned to commence during the period to June 2016.  The rehabilitation of the dam will also free up significant space on site.

During the period a shotblast facility was constructed and commissioned at GRG for the processing of steel mill liners and production of a concentrate for export. This represents a new revenue stream for GRG.  Contracts for sourcing of material have been signed post December 2015 and deliveries of liners have commenced.

Plans are being prepared to install an elution column at the Tema site to improve the processing of carbon and to produce bullion for export in terms of our licence agreement with the Minerals Commission.

Strategically, Goldplat continues to view GRG as a significant growth opportunity with plans to source material for GRG from both West Africa and South America ongoing.

Kilimapesa Gold

Challenges at Kilimapesa remain significant and production of 932 ounces of gold for the six month period ended 31 December 2015 was down compared to 2,278 ounces of gold in FY 2015 and 1,081 ounces for the six month period to 31 December 2014. The main reason for this decrease was that sourcing of tailings from third parties was stopped by the Kenyan Government during the period.  Processing of tailings from within the Kilimapesa lease area has subsequently been restarted.

Re-opening of Adit D was completed during the period and on-reef development began. A second outlet to Adit Bull has commenced on reef.  Once completed, a new mining block will be opened up between Adit Bull and Adit D levels, which will provide production flexibility. Low grade ore is being stockpiled for later processing and waste sorting continues.

The Teng-Teng mine, which is part of the Kilimapesa exploration permit, was dewatered and re-equipped during the period.  On-reef exploration has commenced in this area with encouraging gold grades reported by previous owners being confirmed from initial limited and early stage exploration work. 

A Knelson concentrator was installed at Kilimapesa during the period and is ready for trials at the existing processing facility.

Operations at Kilimapesa continue to be processing-constrained, both in terms of the size and efficiency of the existing processing facility as well as the tailings deposition facility. The life of the tailings deposition facility has now been extended to 6-9 months. Ground for a new processing facility and tailings deposition site has been secured with all the necessary documentation and permitting being substantially complete, with only the approval of the Environmental Impact Assessment and VAT exemptions pending.  Designs for both the processing plant and the tailings facility have been completed. The expansion is planned in two stages, the first of which includes moving the CIL plant from GRG to Kilimapesa and constructing it on the new site. An interim tailings facility serving the CIL will be constructed on the final facility site. This process is expected to commence during Q2 2016 and be completed before the end of 2016.

Discussions regarding funding of the above project as well as regarding Kilimapesa in general remain ongoing with renewed interest being showed since the gold price started to improve. A local bank facility of $250,000 is in place for financing of equipment related to the production and processing expansion.

Exploration and Development Portfolio

In the light of the political problems in Burkina Faso, the Nyieme gold project, which is at an early stage of exploration, and Midas Gold SARL, which has potential to be developed into a gold recovery operation, remain low priority projects in the near term.  In Ghana it is intended that progress will be made on the Anumso Gold Project. To this end, preliminary talks are underway with third parties regarding potential partnerships

Conclusion

For the rest of the current year we expect production and sales to continue at current rates, and for the recovery operations to build on the success of the first half. Capital projects during the period to June 2016 will be restricted to high priority projects including, but not limited to, the stage 1 expansion at Kilimapesa and the installation of an elution column at GRG. The major challenge ahead is to return Kilimapesa to profitability or to find a corporate solution to alleviate the losses from this operation.

With a turnaround strategy in place and delivering results, the problems associated with the Rand Refinery overcome, cost cutting efforts continuing, and the gold price showing signs of recovery, we remain optimistic about the future of Goldplat.

Brian Moritz
Chairman
22 February 2016

 

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE SIX MONTHES ENDED 31 DECEMBER 2015

 

 

 
           

Notes
  6 months
31-Dec-15
(unaudited)
£'000
  6 months
31-Dec-14
(unaudited)
£'000
  12 months
30-Jun-15
(audited)
£'000
Continuing operations                    
Revenue               10,673   8,054   16,628
Cost of sales             (9,472)   (7,952)   (15,660)
Gross profit               1,201   102   968
                     
Administrative expenses           (956)   (929)   (1,679)
Results from operating activities       245   (827)   (711)
                     
Finance income           171   644   843
Finance costs           (21)   (194)   (807)
Net finance income       150   450   36
                 
Write off development cost of discontinued South African Mining Operations   -   -   (121)
Income/(Loss) before tax           395   (377)   (796)
                     
Taxation       6   (203)   (40)   (96)
Income/(Loss) for the period       192   (417)   (892)
                 
Other comprehensive income/(expense)            
Exchange translation   (511)   317   (860)
Other comprehensive income/(loss) for the period, net of tax (511)   317   (860)
                 
Total comprehensive (loss) for the period   (319)   (100)   (1,752)
                 
Income/(Loss) attributable to:                
Owners of the Company       (11)   (503)   (1,143)
Non-controlling interests       203   86   251
Income/(Loss) for the period       192   (417)   (892)
                 
Total comprehensive (loss) attributable to:            
Owners of the Company       (522)   (186)   (2,003)
Non-controlling interests       203   86   251
Total comprehensive (loss) for the period   (319)   (100)   (1,752)
                 
Earnings per share - continuing operations            
Basic earnings per share (pence)         0.11   (0.25)   (0.53)
Diluted earning per share (pence)         0.10   n/a   n/a

The notes below are an integral part of this condensed consolidated interim financial report.

 

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 31 DECEMBER 2015

             

 

Notes
  31-Dec-15
(unaudited)
£'000
  31-Dec-14
(unaudited)
£'000
  30-Jun-15
(audited)
£'000
Assets                    
Property, plant and equipment       7   4,475   4,396   4,449
Intangible assets       8   7,253   7,327   7,033
Pre-production expenditure       9   2,136   2,452   2,136
Proceeds from sale of shares in subsidiary     1,093   1,450   1,357
Non-current cash deposits           218   238   233
Non-current assets           15,175   15,863   15,208
                     
Inventories       10   8,063   6,063   7,727
Trade and other receivables       11   4,773   3,421   3,305
Cash and cash equivalents       12   729   643   630
Current assets           13,565   10,127   11,662
                     
Total assets           28,740   25,990   26,870
                     
Equity                    
Share capital       13   1,685   1,685   1,685
Share premium           11,498   11,498   11,498
Exchange reserve           (7,218)   (5,530)   (6,707)
Retained earnings           9 873   10,508   9,868
Equity attributable to owners of the Company       15,838   18,161   16,344
                     
Non-controlling interests           1,984   1,728   1,893
Total equity           17,822   19,889   18,237
                     
Liabilities                    
Obligations under finance leases   14   161   183   199
Interest bearing borrowings       15   -   -   56
Provisions       16   106   129   121
Deferred tax liabilities           452   454   459
Non-current liabilities           719   766   835
                     
Interest bearing borrowings       15   91   -   104
Obligations under finance leases   14   129   228   120
Taxation           30   -   18
Trade and other payables       17   9,949   5,107   7,556
Current liabilities           10,199   5,335   7,798
                     
Total liabilities           10,918   6,101   8,633
                     
Total equity and liabilities           28,740   25,990   26,870

The notes below are an integral part of this condensed consolidated interim financial report.

The financial statements of Goldplat plc, company number 05340664, were approved by the Board of Directors and authorised for issue on 22 February 2016.  They were signed on its behalf by:

Ian Visagie, Director

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 31 DECEMBER 2014


Attributable to owners of the Company      
     

 
   

 
 

Share
capital
£'000
 

Share premium
£'000
 

Exchange reserve
£'000
   

Retained earnings
£'000
 

 

Total
£ '000
Non-controlling interests
£'000
   

Total equity
£'000
 
Balance at 1 July 2014, as previously reported   1,685   11,498   (5,847)   11,011   18,347   1,642   19,989  
                                   
Total comprehensive income for the period                              
Loss for the period         -   -   -   (503)   (503)   86   (417)  
Total other comprehensive income       -   -   317   -   317   -   317  
Total comprehensive income for the period   -   -   317   (503)   (186)   86   (100)  
                                     
Transactions with owners of the Company, recognised directly in equity                        
                                   
Contributions by and distributions to owners of the Company                          
Share based payments transactions       -   -   -   -   -   -   -  
Total contributions by and distributions to owners of the Company        

-
   

-
   

-
   

-
   

-
   

-
   

-
 
                                     
Balance at 31 December 2014 (unaudited)   1,685   11,498   (5,530)   10,508   18,161   1,728   19,889  

The notes below are an integral part of this condensed consolidated interim financial report.



CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 JUNE 2015

Attributable to owners of the Company      
     

 
   

 
 

Share
capital
£'000
 

Share premium
£'000
 

Exchange reserve
£'000
   

Retained earnings
£'000
 

 

Total
£ '000
Non-controlling interests
£'000
   

Total equity
£'000
Balance at 1 January 2015         1,685   11,498   (5,530)   10,508   18,161   1,728   19,889
Total comprehensive income for the period                            
Loss for the period         -   -   -   (640)   (640)   165   (475)
Total other comprehensive income       -   -   (1,177)   -   (1,177)   -   (1,177)
Total comprehensive income for the period     -   -   (1,177)   (640)   (1,817)   165   (1,652)
                                   
Transactions with owners of the Company recognised directly in equity                      
                                 
Contributions by and distributions to owners of the Company                        
Share based payment transactions       -   -   -   -   -   -   -
Total contributions by and distributions to owners of the Company       -   -   -   -   -   -   -
                                   
Balance at 30 June 2015 (audited)         1,685   11,498   (6,707)   9,868   16,344   1,893   18,237

The notes below are an integral part of this condensed consolidated interim financial report.

 

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

FOR THE SIX MONTHS ENDED 31 DECEMBER 2015

Attributable to owners of the Company      
     

 
   

 
 

Share
capital
£'000
 

Share premium
£'000
 

Exchange reserve
£'000
   

Retained earnings
£'000
 

 

Total
£ '000
Non-controlling interests
£'000
   

Total equity
£'000
Balance at 1 July 2015         1,685   11,498   (6,707)   9,868   16,344   1,893   18,237
Total comprehensive income for the period                                
Profit for the period         -   -   -   (11)   (11)   203   192
Total other comprehensive income       -   -   (511)   -   (511)   -   (511)
Total comprehensive income for the period       -   -   (511)   (11)   (522)   203   (319)
                                   
Transactions with owners of the Company recognised directly in equity                      
                                 
Contributions by and distributions to owners of the Company                        
Share based payment transactions       -   -   -   16   16   -   16
Total contributions by and distributions to owners of the Company       -   -   -   16   16   -   16
                                   
Changes in ownership interests in subsidiaries                            
Non-controlling interests in subsidiary dividend   -   -   -   -   -   (112)   (112)
Total transactions with owners of the Company   -   -   -   -   -   (112)   (112)
                                   
Balance at 31 December 2015 (unaudited)     1,685   11,498   (7,218)   9,873   15,838   1,984   17,822

The notes below are an integral part of this condensed consolidated interim financial report.

 

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE SIX MONTHS ENDED 31 DECEMBER 2015

 

       
             

 

Notes
  6 months
31-Dec-15
(unaudited)
£'000
  6 months
31-Dec-14
(unaudited)
£'000
  12 months
30-Jun-15
(audited)
£'000
 
Cash flows from operating activities                      
Results from operating activities           261   (827)   (832)  
Adjustments for:                      
-  Depreciation           220   256   390  
-  Amortisation           90   16   189  
-  Loss on sale of property, plant and equipment       39   -   148  
-  Equity-settled share-based payment transactions     16   -   -  
-  Foreign exchange differences       (374)   27   (172)  
            252   (528)   (277)  
Changes in:                      
-  inventories           (336)   (975)   (2,639)  
-  trade and other receivables           (1,468)   1,365   1,481  
-  trade and other payables           2,393   (875)   1,574  
-  provisions           (15)   -   (8)  
Cash generated from/(used in)  operating activities     826   (1,013)   131  
                       
Finance income           171   644   843  
Finance cost           (21)   (194)   (679)  
Taxes paid           (146)   (43)   (76)  
Net cash from/(used in) operating activities       830   (606)   219  
                       
Cash flows from investing activities                      
Proceeds from sale of property, plant and equipment       34   35   24  
Enhancement of exploration and development asset       (59)   (31)   (92)  
Acquisition of property, plant and equipment       (623)   (84)   (909)  
Non-current cash deposit           15   (36)   (31)  
Net cash used in investing activities           (633)   (116)   (1,008)  
                       
Cash flows from financing activities                      
Payment of interest bearing borrowings     (69)   -   160  
Payment of finance lease liabilities     (29)   (90)   (196)  
Net cash used in financing activities       (98)   (90)   (36)  
                       
Net increase/(decrease) in cash and cash equivalents           99   (812)   (825)  
                   
Cash and cash equivalents at beginning of period       630   1,455   1,455  
Cash and cash equivalents at end of period   12   729   643   630  

The notes below are an integral part of this condensed consolidated interim financial report.


NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL REPORT
FOR THE SIX MONTHS ENDED 31 DECEMBER 2015
             
             

  1. General information

            The information for the year ended 30 June 2015 does not constitute statutory accounts as defined in section 434 of the Companies Act 2006.  A copy of the statutory accounts for that year has been delivered to the Registrar of Companies.  The auditors reported on those accounts: their report was unqualified, did not draw attention to any matters by way of emphasis and did not contain a statement under section 498(2) or (3) of the Companies Act 2006.
             
2. Basis of preparation

a. Statement of compliance
The annual financial statements of Goldplat plc (the 'Company') are prepared in accordance with IFRSs as adopted by the European Union.  The condensed financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting', as adopted by the European Union.

b. Going concern
The directors are satisfied that the Company has sufficient resources to continue in operation for the foreseeable future, a period of not less than 12 months from the date of this report.  Accordingly, they continue to adopt a going concern basis in preparing the consolidated financial statements.

  1. Significant accounting policies

            The accounting policies applied by the Group in this condensed consolidated interim financial report are the same as those applied by the Group in its consolidated financial statements as at and for the year ended 30 June 2015.
             
4.                  Operating segments
             
Information about reportable segments
For the six months ended 31 December 2015 (unaudited)

           

Recovery operations
£'000
 

Mining and exploration
£'000
 

Adminis-tration
£'000
Reconciliation to Group figures
£'000
 

 

Group
£'000
External revenues     10,014 659 - - 10,673
Inter-segment revenues     2,289 - - (2,289) -
Total revenues       12,303 659 - (2,289) 10,673
           
Reportable segment profit/(loss) before tax 1,222 (477) (368) 18 395
Reportable segment assets 16,651 6,415 29,158 (23,484) 28,740
Reportable segment liabilities 11,287 5,156 4,798 (10,323) 10,918
           

For the six months ended 31 December 2014 (unaudited)

           

Recovery operations
£'000
 

Mining and exploration
£'000
 

Adminis-tration
£'000
Reconciliation to Group figures
£'000
 

 

Group
£'000
External revenues     7,407 647 - - 8,054
Inter-segment revenues     221 - - (221) -
Total revenues       7,628 647 - (221) 8,054
           
Reportable segment profit/(loss) before tax 4 (368) (13) - (377)
Reportable segment assets 17,407 1,396 7,187 - 25,990
 Reportable segment liabilities

 
6,132 371 121 (523) 6,101

For the twelve months ended 30 June 2015 (audited)

           

Recovery operations
£'000
 

Mining and exploration
£'000
 

Adminis-tration
£'000
Reconciliation to Group figures
£'000
 

 

Group
£'000
External revenues     15,037 1,591 - - 16,628
Inter-segment revenues     1,805 - - (1,805) -
Total revenues       16,842 1,591 - (1,805) 16,628
           
Reportable segment profit/(loss) before tax 873 (933) (550) (65) (675)
Reportable segment assets 14,546 6,099 28,542 (22,317) 26,870
Reportable segment liabilities 8,292 4,515 4,969 (9,143) 8,633

             
             

  1. Seasonality of operations

            The Group is not considered to be subject to seasonal fluctuations.
             

  1. Income tax expense

            Income tax expense is recognised based on management's best estimate of the weighted average annual income tax rate expected for the full financial year applied to the pre-tax income of the interim period.  The Group's consolidated effective tax rate in respect of continuing operations for the six months ended 31 December 2015 was 20.00% (six months ended 31 December 2014: 21%; twelve months ended 30 June 2015: 20.75%). 

  1. Property, plant and equipment

             
            Acquisitions and disposals
            During the six months ended 31 December 2015, the Group acquired assets with a cost, excluding capitalised borrowing costs of £623,000 (six months ended 31 December 2014: £310,000; twelve months ended 30 June 2015: £1,149,000).
             
            Assets with a carrying amount of £73,000 were disposed of during the six months ended 31 December 2015 (six months ended 31 December 2014: £35,000; twelve months ended 30 June 2015: £172,000), resulting in a loss on disposal of £39,000 (six months ended 31 December 2014: £nil; twelve months ended 30 June 2015: £148,000), which is included in 'administrative expenses' in the condensed consolidated statement of comprehensive income.
             


  1. Intangible assets
             

 

 

 
6 months
31-Dec-15
(unaudited)
£'000
6 months
31-Dec-14
(unaudited)
£'000
12 months
30-Jun-15
(audited)
£'000
Cost      
Balance at beginning of period 7,750 7,974 7,974
Additions 59 31 92
Foreign exchange translation 245 178 (316)
Balance at end of period 8,054 8,183 7,750

Amortisation and impairment losses      
Balance at beginning of period 717 780 780
Amortisation 17 16 29
Foreign exchange translation 67 60 (92)
Balance at end of period 801 856 717
 

Carrying amounts
     
Balance at end of period 7,253 7,327 7,033
Balance at beginning of period 7,033 7,194 7,194

           

  1. Pre-production expenditure
             

 
6 months
31-Dec-15
(unaudited)
£'000
6 months
31-Dec-14
(unaudited)
£'000
12 months
30-Jun-15
(audited)
£'000
Cost      
Balance at beginning of period   4,172 4,172 4,172
    4,172 4,172 4,172

             

Amortisation and impairment losses      
Balance at beginning of period   2,036 1,715 1,715
Amortisation for the period   73 - 160
Impairment   - 81 -
Effect of movement in exchange rates   (73) (76) 161
    2,036 1,720 2,036
Carrying amounts      
Balance at end of period   2,136 2,452 2,136
Balance at beginning of period   2,136 2,457 2,457

             
             

  1. Inventories

             

             

 
6 months
31-Dec-15
(unaudited)
£'000
6 months
31-Dec-14
(unaudited)
£'000
12 months
30-Jun-15
(audited)
£'000
Consumable stores     915   1,306   1,009
Raw materials     473   523   516
Precious metals on hand and in process     6,572   4,178   6,115
Broken ore     103   56   87
      8,063   6,063   7,727

             

  1. Trade and other receivables

             

             

 
6 months
31-Dec-15
(unaudited)
£'000
6 months
31-Dec-14
(unaudited)
£'000
12 months
30-Jun-15
(audited)
£'000
Trade receivables     3,119 2,119   2,447
Other receivables     1,654   1,222   858
      4,773   3,421   3,305

             

  1. Cash and cash equivalents
             

 
6 months
31-Dec-15
(unaudited)
£'000
6 months
31-Dec-14
(unaudited)
£'000
12 months
30-Jun-15
(audited)
£'000
Bank balances   729 643 630
         
Cash and cash equivalents in the statement of cash flows 729 643 630

             

  1. Capital and reserves
Issue of ordinary shares

 
         
 

 
           

 
6 months
31-Dec-15
(unaudited)

 
6 months
31-Dec-14
(unaudited)
12 months
30-Jun-15
(audited)

 
On issue at beginning of period   168,441,000 168,441,000 168,441,000
On issue at end of period   168,441,000 168,441,000 168,441,000
Authorised -  par value £0.01 1,000,000,000 1,000,000,000 1,000,000,000

             

Issue of ordinary shares

 
         
 

 
           

 
6 months
31-Dec-15
(unaudited)
£'000
6 months
31-Dec-14
(unaudited)
£'000
12 months
30-Jun-15
(audited)
£'000
On issue at beginning of period   1,685 1,685 1,685
On issue at end of period   1,685 1,685 1,685

             
Dividends
The following dividends were declared and paid by the Company:

             

 
6 months
31-Dec-15
(unaudited)
£'000
6 months
31-Dec-14
(unaudited)
£'000
12 months
30-Jun-15
(audited)
£'000
Nil pence per qualifying ordinary share   - - -

  1. Obligations under finance leases

             
            Six months ended 31 December 2015 (unaudited)

         

 
     

 

Currency
Interest
rate
nominal
Year of maturity

 
Face value
£'000
Carrying amount
£'000
                             
Finance lease liabilities           ZAR   9.75%   2016/17   (290)   (290)
Total Interest-bearing liabilities                       (290)   (290)
                             

            Six months ended 31 December 2014 (unaudited)

         

 
     

 

Currency
Interest
rate
nominal
Year of maturity

 
Face value
£'000
Carrying amount
£'000
                             
Finance lease liabilities           ZAR   9%   2015/16   (411)   (411)
Total Interest-bearing liabilities                       (411)   (411)

             
            Twelve months ended 30 June 2015 (audited)

         

 
     

 

Currency
Interest
rate
nominal
Year of maturity Face value
£'000
Carrying amount
£'000
                             
Finance lease liabilities           ZAR   9%   2015/16   (319)   (319)
Total Interest-bearing liabilities                       (319)   (319)

             
             

  1. Interest bearing borrowings

             
            Six months ended 31 December 2015 (unaudited)

         

 
     

 

Currency
Interest
rate
nominal
Year of maturity

 
Face value
£'000
Carrying amount
£'000
                             
Interest bearing borrowings           ZAR   9.75%   2016   (91)   (91)
Total Interest-bearing liabilities                       (91)   (91)
                             

            Six months ended 31 December 2014 (unaudited)

         

 
     

 

Currency
Interest
rate
nominal
Year of maturity

 
Face value
£'000
Carrying amount
£'000
                             
Interest bearing borrowings           -   -   -   -   -
Total Interest-bearing liabilities                       -   -

             
            Twelve months ended 30 June 2015 (audited)

         

 
     

 

Currency
Interest
rate
nominal
Year of maturity Face value
£'000
Carrying amount
£'000
                             
Interest bearing borrowings           ZAR   9.25%   2016     (160)   (160)
Total Interest-bearing liabilities                       (160)   (160)

             


  1. Provisions

             
           

 

 

 
  6 months
31-Dec-15
(unaudited)
£'000
  6 months
31-Dec-14
(unaudited)
£'000
  12 months
30-Jun-15
(audited)
£'000
Environmental obligation            
Balance at beginning of period   121   129   129
Provisions made during the period   5   -   -
Foreign exchange translation   (20)   -   (8)
    106   129   121

             
            The provision relates to a requirement to rehabilitate the land owned in South Africa upon cessation of the mining lease.

  1. Trade and other payables
             

 
6 months
31-Dec-15
(unaudited)
£'000
6 months
31-Dec-14
(unaudited)
£'000
12 months
30-Jun-15
(audited)
£'000
Trade payables     2,440   1,384   1,860
Accrued expenses     7,509   3,723   5,696
      9,949   5,107   7,556
  1. Share options

Reconciliation of outstanding share options

      6 months ended
31-Dec-15
(unaudited)
6 months ended
31-Dec-14
(unaudited)
12 months ended
30-Jun-15
(audited)
      Number of options Exercise price Number of options Exercise price Number of options Exercise price
Outstanding at beginning of period 8,500,000   7,500,000   7,500,000  
Granted during the period 11,000,000 3.125p 1,000,000 6.00p 1,000,000 6.00p
Outstanding at end of period 19,500,000   8,500,000   8,500,000  

                                                                       
Of the options outstanding at 31 December 2015, 12,166,666 are exercisable (31 December 2014: 8,500,000; 30 June 2015: 8,500,000).
The weighted average exercise price of the exercisable options is £0.0864 (31 December 2014: £0.1072; 30 June 2015: £0.1103).
The weighted average exercise price of the outstanding options is £0.0657 (31 December 2014: £0.1072; 30 June 2015: £0.1103).
             
On 22 July 2015 the Company issued 11,000,000 share options to key management.  The fair value of these options has been independently calculated using the Black Scholes model using the following assumptions:

                                                Tranche 1        Tranche 2        Tranche 3

Number of options                  3,666,667        3,666,667        3,666,666
Risk free interest rate             - 1.51%            - 1.69%            - 1.83%
Expected volatility                  - 58.61%          - 58.61%          - 58.61%
Expected dividend yield          - 0%                 - 0%                 - 0%
Life of the option                     - 5 years          - 6 years          - 7 years

The weighted average remaining contractual life of the options outstanding as at 31 December 2015 is 1 year 360 days (31 December 2014: 4 years 142 days; 30 June 2015: 3 years 45 days).

19.              Fair values
             
            The fair values of financial instruments such as interest-bearing loans and borrowings, finance lease liabilities, trade and other receivables/payables are substantially identical to carrying amounts reflected in the statement of financial position.
             

  1. Contingencies

The Kenyan Revenue Authority has conducted a preliminary enquiry on the tax affairs of Kilimapesa Gold (Pty) Limited which may result in additional tax liabilities.

Her Majesty's Revenue and Customs in the UK have raised a VAT assessment on the parent company of £147,762. The company is in the process of an appeal against this.

In both cases the directors remain confident of a favourable outcome.