Interim Results


 Vast Resources plc / Ticker: VAST / Index: AIM / Sector: Mining
24 December 2018

Vast Resources plc
(“Vast” or the “Company”)
Interim Results for the six months to 30 September 2018

Highlights

Financial

  • 47% increase in revenue to $21.942 million (2017:$14.882 million) from the Group’s two operational mines in Romania and Zimbabwe
  • 31% increase in administrative overhead expenses ($3.5 million) compared to the same period in the previous year (2017: $2.7 million)
  • A foreign exchange loss of $1.4 million compared to a foreign exchange gain of $1.2 million in the same period in the previous year  
  • $1.3 million loss from operations compared to a $0.56 million profit from operations in the same period in the previous year
  • A 83% decrease in total loss after taxation to $2.1 million (2017: loss $12.6 million) due to a $12.5 million exceptional item incurred in the same period in the previous year
  • Optimisation and expansion initiatives at Manaila Polymetallic Mine including construction of the new Carlibaba metallurgical plant impeded due to delay accessing the Tranche B funds from Mercuria
  • Accelerated repayments of historic debts from Mineral Mining to allow the granting of the Baita Plai association licence also impacted the Group’s financial results
  • Cash balances at period end $0.661 million (2017:$1.723 million)

Post period end

  • Cash balances at 21 December 2018: $1.379 million

Operational Development

  • Pickstone-Peerless Gold Mine (Zimbabwe)
    • 8% increase in gold production to 13,352 Troy ounces from 12,383 Troy ounces in the six months to 31 March 2018 (six months to 30 September 2017: 8,775 ounces)
  • Manaila Polymetallic Mine (Romania)
    • 61% increase in copper concentrate produced to 1,526 tonnes from 948 tonnes in six months to 31 March 2018 (six months to 30 September 2017:1910 tonnes)
    • 97% increase in zinc concentrate produced to 199 tonnes from 100 tonnes in six months to 31 March 2018 (six months to 30 September 2017: 275 tonnes)
  • Acquisition of Delta Gold Zimbabwe, owners of Eureka Gold Mine, by 25.01% owned Group company Dallaglio Investments (Private) Limited, in April 2018
  • Conditional acquisition of a 29.41% interest in the Blueberry Project in the Golden Quadrilateral of Romania
  • Exclusive access for initial due diligence and pre-agreed joint venture terms on Heritage Diamond Concession in the Marange Diamond Fields

             
Post period end:

  • Agreement with Botswana Diamonds plc on Heritage Concession on 4 October 2018
  • Right to mine at Baita Plai Polymetallic Mine granted on 16 October 2018
  • Acquisition of 29.41% interest in the Blueberry Project confirmed on 30 October 2018
  • Commencement of drilling at Magura Neagra and Piciorul Zimbrului on 19 November 2018

Funding

Share issues during the year: gross proceeds before cost of issue

£Shares issuedIssued to
87,27217,100,447Exercise of Warrants
1,250,000238,095,238Issued to investors on placing
  863,750 133,914,127Subscription by investors
 2,201,022 389,463,818 

Post period end

£Shares issuedIssued to
4,010801,896Exercise of Warrants
425,08670,847,785Issued to investors on placing
100,00016,666,666Subscription by directors
1,000,000188,679,245Issued to investors on placing
68,00068,000,000Issued to Bergen in the context of a $3 million bridge facility

Debt Funding

Post period end

  • A US$3 million bridge facility entered with the Bergen Global Opportunity Fund LP on 19 December 2018 for the purchase of zero coupon convertible securities in two equal Tranches.  Each Tranche will not be convertible into shares in the Company for an initial period of 30 days, and the Company can repay each Tranche in full without penalty up until 20 March 2019
     
  • US$600,000 repaid to Sub-Sahara Goldia Investments Ltd

Board and Management

  • Appointment of Nicholas Hatch as non-executive director on 9 May 2018
  • Appointment of Mark Mabhudhu, diamond specialist, to Board of Vast Zimbabwe on 6 July 2018

CHIEF EXECUTIVE OFFICER’S REPORT

The half year coupled with events post period end have been an interesting time for the growth of the Company.  Notably the long-expected award of the Baita Plai Association Licence and the re-opening of the Baita Plai Polymetallic Mine will enhance both the profitability and the cash generation capacity of the Romania operations.  Management now anticipates that mining at Baita Plai will be able to start operations within six months. Funding required to rehabilitate the infrastructure, improve safety, and expand the galleries will be covered by the recent bridging loan followed by a part of the ‘Tranche B’ US$5.5m draw down of the Pre-Payment Offtake Agreement with Mercuria when available.  The other significant event that will potentially change the direction and near term cashflow of the Company is the signing of the agreement with Red Mercury which should, subject to Red Mercury receiving the final licence, lead to the mining of diamonds on the Heritage Concession in the Marange Diamond Fields of Zimbabwe.

The revenue realised in the current half year period rose 47% on the half year to September 2017 due to a large increase in gold sales. The impact of the noteworthy revenue increase was not directly reflected due to an increase in overheads, from 16.8% of revenue for the half year to September 2017 to 31.1% of revenue for the current half year. This was to a large extent caused by foreign exchange losses incurred in excess of $1.4million for the current half year compared to $1.2million in foreign exchange gains realised in the corresponding period to 30 September 2017.  Additional factors were the flooding in the pit at Pickstone Peerless (now rectified) and the inclusion of more than $300,000 in overheads incurred by Delta Gold on the Eureka Gold Mine.

The Manaila mine has performed to the best of its ability with the current plant and equipment available.  The Manaila mine in its current state before the investment of new plant has constituted a proof of concept for mining in Romania without which it is doubtful that the Company would have secured the right to mine at Baita Plai or the Blueberry Project.  Manaila will only be a cash generator for the Company once we have built the plant in Carlibaba.

Until the new plant is operational we wish to ensure that we mine at a level that does not cause the Company losses, and action has been planned and is being implemented to address inadequate in-pit ore haulage capacity and cost effective conveyance of the required historically budgeted 15,000 tonnes per month in ore volumes from the pit operations to the floatation plant.  However a management decision has been made to reduce the budgeted target to 10,000 tonnes per month in order to reduce costs and optimise the floatation plant until the procurement of a new dumper and excavator fleet arrives early 2019.  Management had also decided to focus on pre-stripping activity to access higher ore grades but for reasons stated this endeavour was hampered by deficient excavating and transport assets. The low production volumes meant that overheads were not fully recovered resulting in cash costs of concentrate exceeding realisable sales values per tonne. An upgraded truck-and-shovel fleet is expected to be in place at Manaila during the current financial year and is expected to significantly improve delivered ore volumes.

Pickstone-Peerless Gold Mine in Zimbabwe experienced above trend increases in mining and overhead costs in the reporting period. This was occasioned by an unprecedented flooding of the pit and an increase in overburden stripping to access declining oxide ore reserves; to facilitate sulphide mining; and to provide adequate mining areas for future periods. The benefits of this overburden removal will be positively felt during future reporting periods.  Cash flow generated at Pickstone-Peerless has generated funds which, together with the local bank overdraft, has funded both the recently constructed sulphide plant and initial expenditure on the Eureka Gold Mine. A $30million debt facility is currently being negotiated to fund the development of Eureka.

Proximal to the Marange Diamond Fields the Group assembled and mobilised a team of geologists and engineers who have undertaken an extensive investigation into the potential of modern alluvial diamond placer deposits and the possibility of the basal Umkondo unit on the Heritage Concession.  The Group concluded an exclusive access agreement for due diligence and pre-agreed Joint Venture terms with Red Mercury as outlined in the Company's announcement of 22 August 2018 and since then has completed positive commercial due diligence on the project.

Vast will be focusing on improving results in its core operations in both Romania and Zimbabwe. Opportunities in both jurisdictions will be pursued rigorously with reliance made on its local management and the extensive network of relationships with key parties.

Andrew Prelea
Chief Executive Officer

CHAIRMAN’S STATEMENT

In Romania, our focus during the reporting period was to secure the Baita Plai Association Licence; to improve the performance of the Manaila Polymetallic Mine; to expand our mineralised footprint in the area proximal to the present open pit mining operation; and to pursue opportunities elsewhere in Romania.

I am happy to report, following the execution of the Association Contract for Baita Plai, we now have the mining rights. We have deployed the start-up team to Baita Plai to commence the implementation of the re-start programme.

We intend to publish the start-up works and provide regular updates over the course of the next six months as we target initial production from Baita Plai by the end of H1 2019. Alongside our numerous other production, development and appraisal assets in Romania and Zimbabwe, we have taken a major step forward to achieving our target of mid-tier multi-commodity producer status.

At Manaila, copper and zinc concentrate volumes and quality have not improved, which regrettably impacted adversely on Group profits and cash flows.  However, as Andrew Prelea has indicated in his report, the Manaila Mine was a ‘test case’ for the ability to mine in Romania and has been, we believe, an essential step in the final award of the right to mine at Baita Plai.

Plans are well advanced to construct a metallurgical processing facility proximal to future mining operations to deal with the projected increased ore supply at Manaila both from the original pit and from the Carlibaba extension. The configuration of the new facilities is expected to contribute substantially to the improving efficiency and cost effectiveness of open pit operations as an economic scale of operations will be realisable. Nevertheless, our focus over the next six months is in bringing Baita Plai into profitable production.

We were pleased to announce on 28 September 2018 that surface exploration drilling had commenced at the Magura Neagra and Piciorul Zimbrului prospecting licences (collectively Zagra) in northern Romania. Although a longer term project than the nearby Manaila mine, or our near term production assets at Baita Plai, the licences are highly compelling by virtue of the historic assessments conducted by the previous state exploration company which pointed to both licences demonstrating sufficient size and scale to warrant a comprehensive exploration campaign.

We acquired an effective 29.41% interest the Blueberry Polymetallic Gold Project, a 7.285km brownfield area of prospectivity in the Golden Quadrilateral of Romania located in the immediate vicinity of the now closed Baia de Aries mine.

In Zimbabwe, our focus during the reporting period was to secure a foothold in the Marange Diamond Fields. We have agreed, subject to due diligence, to enter into a potentially significant joint venture on the Heritage Concession. We already hold an 86.67% interest in a SPV which has a due diligence access agreement and pre-agreed joint venture terms regarding the aforesaid diamond concession within the Marange Diamond Fields, widely considered to be one of the richest sources of alluvial diamonds globally. Importantly, the senior management of Vast has been working closely with the community leaders and is developing strong ties with local stakeholders. The wellbeing and advancement of the community is paramount to the success of a long-term business within the Marange Diamond Fields.

In the gold mining field, results at the Pickstone-Peerless Mine have continued to be good, and we also acquired a 23.75% interest in the Eureka Gold Mine, which is planned to be in production by June 2019.

Our finances have been adversely affected by the delay in the completion of due diligence allowing us to draw down the second tranche of the Mercuria finance amounting to $5.5 million. We still expect this to be available for draw down in January 2019, but we have entered into a US$3,000,000 bridge facility with the Bergen Global Opportunity Fund, LP in the interim. Any draw down on this facility is intended to be repaid from the Mercuria funds, so that no conversion rights are expected to apply.

Brian Moritz
Chairman

For further information visit www.vastresourcesplc.com or please contact:

Vast Resources plc
Andrew Prelea (Chief Executive Officer)
www.vastresourcesplc.com
+44 (0) 20 7236 1177
Beaumont Cornish – Financial & Nominated Adviser
Roland Cornish
James Biddle
www.beaumontcornish.com
+44 (0) 020 7628 3396
Brandon Hill Capital Ltd – Joint Broker
Jonathan Evans
www.brandonhillcapital.com
+44 (0)20 3463 5016
SVS Securities Plc – Joint Broker
Tom Curran
Ben Tadd
www.svssecurities.com
+44 (0)20 3700 0100
St Brides Partners Ltd
Susie Geliher
Juliet Earl
www.stbridespartners.co.uk
+44 (0) 20 7236 1177



Condensed consolidated statement of comprehensive income
for the six months ended 30 September 2018

  30 Sep 201831 Mar 201830 Sep 2017
  UnauditedAuditedUnaudited
  GroupGroupGroup
 Note$’000$’000$’000
Revenue 21,942 30,688  14,882 
Cost of sales (16,431)(23,412)(11,815)
Gross profit 5,511 7,276 3,067 
     
Overhead expenses (6,817)(5,259)(2,509)
Depreciation and impairment of property, plant and equipment (2,108)(2,862)(1,259)
Profit (loss) on sale of property, plant and equipment (2)(22)29 
Share option and warrant expense (122)(27)- 
Sundry income 293 812 256 
Exchange (loss) gain (1,359)2,301 1,152 
Other administrative and overhead expenses (3,519)(5,461)(2,687)
     
Profit (loss) from operations (1,306)2,017  558  
     
Finance income 26 42 20 
Finance expense (851)(1,202)(676)
Loss on disposal of interest in subsidiary loans - (12,538)(12,538)
     
Loss before taxation from continuing operations (2,131)(11,681)(12,636)
     
Taxation charge - (3,794)- 
     
Total Loss after taxation for the year (2,131)(15,475)(12,636)
     
Other comprehensive income    
Items that may be subsequently reclassified to either profit or loss   
Gain on available for sale financial assets 1 3 2 
Exchange gain (loss) on translation of foreign operations 954 (1,435)(976)
Total comprehensive loss for the year (1,176)(16,907)(13,610)
     
Total loss attributable to:    
- the equity holders of the parent company (4,510)(17,295)(13,916)
- non-controlling interests 2,379 1,820 1,280 
  (2,131)(15,475)(12,636)
Total comprehensive profit (loss) attributable to:    
- the equity holders of the parent company (3,555)(18,727)(14,890)
- non-controlling interests 2,379 1,820 1,280 
  (1,176)(16,907)(13,610)
     
Loss per share – basic and diluted3(0.09)(0.36)(0.30)



Condensed consolidated statement of changes in equity

for the six months ended 30 September 2018

  Share  capital  Share premium  Share option reserve  Foreign currency translation reserve  Available for sale reserve  EBT reserve  Retained deficit  Total  Non-controlling interests  Total
  $’000  $’000  $’000  $’000  $’000  $’000  $’000  $’000  $’000  $’000
At 31 March 201719,420 74,802 1,890  (1,228)- (3,942)(69,828)21,114  12,394  33,508  
Total comprehensive loss for the period--- (976)2- (13,916)(14,890)1,280 (13,610)
Share options and warrants lapsed--(79)- -- 79 -  - -  
Investment received in subsidiary - Ronquil Enterprises (Pvt) Ltd--- - -- (757)(757)2,457 1,700  
Interest in mining asset--- - -- (4,604)(4,604)4,604 -  
Acquisition of NCI in subsidiary - Sinarom Ming Group SRL--- - -- (4,075)(4,075)1,772 (2,303)
Shares issued for cash:2849- - -- - 77  - 77  
- to settle liabilities       -  - -  
At 30 September 201719,448 74,851 1,811  (2,204)2 (3,942)(93,101)(3,135)22,507  19,372  
Total comprehensive loss for the period--- (459)1- (3,377)(3,835)540 (3,295)
Share option and warrant charges--27 - -- - 27  - 27  
Share options and warrants lapsed--(258)- -- 258 -  - -  
Shares issued for cash:5922,386- - -- - 2,978  - 2,978  
At 31 March 201820,040 77,237 1,580  (2,663)3 (3,942)(96,220)(3,965)23,047  19,082  
Total comprehensive loss for the period--- 954 1- (4,510)(3,555)2,379 (1,176)
Share option and warrant charges--122 - -- - 122  - 122  
Share options and warrants lapsed--(10)- -- 10 -  - -  
Acquired through business combination - Delta Gold Zimbabwe (Pvt) Ltd--- - -- - -  (1,695)(1,695)
Derecognition of EBT reserve--- - -3,942 (3,715)227  - 227  
Disposal of available for sale investments--- - 3- - 3  - 3  
Shares issued for cash:5122,379- - -- - 2,891  - 2,891  
At 30 September 201820,552 79,616 1,692  (1,709)7 -  (104,435)(4,277)23,731  19,454  


Condensed consolidated statement of financial position
As at 30 September 2018

  30 Sep 201831 Mar 201830 Sep 2017
  UnauditedAuditedUnaudited
  Group GroupGroup
  $’000$’000$’000
AssetsNote   
Non-current assets    
Property, plant and equipment451,347 45,534 43,929 
Investment in joint ventures 563 559 - 
Goodwill arising on consolidation10566 - - 
Deferred tax asset - - 465 
  52,476 46,093 44,394 
Current assets    
Inventory55,536 4,054 2,806 
Receivables69,021 5,406 5,490 
Available for sale investments 15 13 12 
Cash and cash equivalents 661 1,300 1,723 
Total current assets 15,233 10,773 10,031 
Total Assets 67,709 56,866 54,425 
     
Equity and Liabilities    
Capital and reserves attributable to equity holders of the Parent    
Share capital 20,552 20,040 19,448 
Share premium 79,616 77,237 74,851 
Share option reserve 1,692 1,580 1,811 
Foreign currency translation reserve (1,709)(2,663)(2,204)
Available for sale reserve 7 3 2 
EBT reserve - (3,942)(3,942)
Retained deficit (104,435)(96,220)(93,101)
  (4,277)(3,965)(3,135)
Non-controlling interests 23,731 23,047 22,507 
Total equity 19,454 19,082 19,372 
     
Non-current liabilities    
Loans and borrowings723,773 22,635 19,059 
Provisions92,465 1,397 1,140 
Deferred tax liability 3,330 3,330 - 
  29,568 27,362 20,199 
Current liabilities    
Loans and borrowings710,906 4,331 7,974 
Trade and other payables87,781 6,091 6,880 
Total current liabilities 18,687 10,422 14,854 
Total liabilities 48,255 37,784 35,053 
Total Equity and Liabilities 67,709 56,866 54,425 


Condensed consolidated statement of cash flow

for the six months ended 30 September 2018

 30 Sep 201831 Mar 201830 Sep 2017
 UnauditedAuditedUnaudited
 Group GroupGroup
 $’000$’000$’000
CASH FLOW FROM OPERATING ACTIVITES   
Profit (loss) before taxation for the period(2,131)(11,681)(12,636)
Adjustments for:   
Depreciation and impairment charges 2,108 2,862 1,259 
(Profit) loss on sale of property, plant and equipment 2 22 (29)
Loss on disposal of interest in loans -  12,538 12,538 
Share option expense 122 27 - 
 101 3,768 1,132 
Changes in working capital:   
Decrease (increase) in receivables(2,940)8 (274)
Decrease (increase) in inventories(1,205)(2,392)(3)
Increase (decrease) in payables 2,254 (1,998)(1,307)
 (1,891)(4,382)(1,584)
Cash used in operations(1,790)(614)(452)
    
Investing activities:   
Payments to acquire property, plant and equipment(4,390)(9,197)(6,084)
Payments to acquire subsidiary company(4,490)  
Proceeds on disposal of property, plant and equipment 85 107 64 
Proceeds of third party investment in subsidiary -  1,700 1,700 
Proceeds of derecognition of EBT reserve 227 - - 
Payments to acquire controlling interest in subsidiary -  (2,303)(2,303)
Proceeds of loan assignment -  2,300 2,300 
Increase in investment in joint venture(4)(102)- 
Total cash used in investing activities(8,572)(7,495)(4,323)
    
Financing Activities:   
Proceeds from the issue of ordinary shares, net of issue costs 2,891 3,055 77 
Proceeds from loans and borrowings granted 6,885 9,177 7,171 
Repayment of loans and borrowings(53)(4,149)(2,076)
Total proceeds from financing activities 9,723 8,083 5,172 
    
Increase (decrease)  in cash and cash equivalents(639)(26)397 
Cash and cash equivalents at beginning of period 1,300 1,326 1,326 
Cash and cash equivalents at end of period 661  1,300  1,723  



Interim report notes

1          Interim Report
          These condensed interim financial statements, which are unaudited, are for the six months ended 30 September 2018 and consolidate the financial statements of the Company and all its subsidiaries. The statements are presented in United States Dollars.
The financial information set out in these condensed interim financial statements does not constitute statutory accounts as defined in Section 434(3) of the Companies Act 2006. The condensed interim financial statements should be read in conjunction with the consolidated financial statements of the Group for the year ended 31 March 2018 which have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union (“IFRSs”). The Auditor's report on those financial statements was unqualified and did not contain a statement under s.498(2) or s.498(3) of the Companies Act 2006.
While the Auditors’ report for the year ended 31 March 2018 was unqualified, it did include an emphasis of matter concerning going concern, to which the Auditors drew attention by way of emphasis without qualifying their report. Full details of these comments are contained in the report of the Auditors on Page 20 on the annual financial statements for the year ended 31 March 2018, released elsewhere on this website on 28 September 2018.
The accounts for the period have been prepared in accordance with International Accounting Standard 34 “Interim Financial Reporting” (“IAS 34”) and the accounting policies are consistent with those of the annual financial statements for the year ended 31 March 2018, unless otherwise stated, and those envisaged for the financial statements for the year ended 31 March 2019.
New IFRS accounting standards
IFRS 15 and IFRS 9 became effective for the Group from 1 January 2018. As the effects of applying these standards are considered immaterial to the Group, the Group has elected not to demonstrate the impact of these standards on the current period’s results and not to restate prior periods on adoption of the new standards in 2018.
IFRS 15 Revenue from Contracts with Customers
It was reported the annual financial statements for the year ended 31March2018 that the timing and amount of revenue recognised by the Group for the sale of commodities is such that transfer of risks and rewards generally coincides with the transfer of control at a point in time.

IFRS 9 Financial Instruments
It was reported the annual financial statements for the year ended 31March2018 that the impact of adopting IFRS 9 on the Group results for the year ended 31 March 2018 would have been materially unchanged on application of the new standard.
After review of the Group’s operations and of the funding opportunities open to the Group, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, the Directors continue to adopt the going concern basis in preparing the unaudited condensed interim financial statements.

This interim report was approved by the Directors on 21 December 2018

2       Segmental analysis

  Mining, exploration and development  Administration and corporate  Total
  Europe  Africa   
  $’000  $’000  $’000  $’000
 Six months to 30 September 2018     
 Revenue 2,613  19,329  -   21,942 
 Production costs(3,233)(13,198) -  (16,431)
 Gross profit (loss)(620) 6,131  -   5,511 
 Depreciation(818)(1,289)(1)(2,108)
 Profit (loss) on sale of property, plant and equipment -   -  (2)(2)
 Share option and warrant expense -   -  (122)(122)
 Sundry income 136  157  -   293 
 Exchange (loss) gain(1,047) -  (312)(1,359)
 Other administrative and overhead expenses(866)(1,224)(1,429)(3,519)
 Finance income -   26  -   26 
 Finance expense(191)(660) -  (851)
 Loss on disposal of subsidiary company loans -   -   -   -  
 Taxation (charge) -   -   -   -  
 Profit (loss) for the year from continuing operations(3,406) 3,141 (1,866)(2,131)
     
30 September 2018    
 Total assets 14,599  53,090  20  67,709 
 Total non-current assets 11,463  41,502 (489) 52,476 
 Additions to non-current assets 709  3,680  1  4,390 
 Total current assets 3,136  11,588  509  15,233 
 Total liabilities 8,884  24,503  14,868  48,255 


Year to 31 March 2018     
 Revenue 3,098  27,590  -   30,688 
 Production costs(4,298)(19,114) -  (23,412)
 Gross profit (loss)(1,200) 8,476  -   7,276 
 Depreciation and impairment(1,398)(1,461)(3)(2,862)
 Profit (loss) on sale of property, plant and equipment(23) 1  -  (22)
 Share option and warrant expense -   -  (27)(27)
 Sundry income 470  342  -   812 
 Exchange (loss) gain 1,452  -   849  2,301 
 Other administrative and overhead expenses(2,041)(738)(2,682)(5,461)
 Finance income -   42  -   42 
 Finance expense(11)(1,159)(32)(1,202)
 Loss on disposal of subsidiary company loans -   -  (12,538)(12,538)
 Taxation (charge) -  (3,794) -  (3,794)
 Profit (loss) for the year from continuing operations(2,751) 1,707 (14,431)(15,475)


  Mining, exploration and development  Administration and corporate  Total
  Europe  Africa   
  $’000  $’000  $’000  $’000
31 March 2018    
 Total assets 15,359 41,306 201  56,866
 Total non-current assets 12,173 34,409(489) 46,093
 Additions to non-current assets 3,134 6,063 -   9,197
 Total current assets 3,186 7,456 690  11,332
 Total liabilities 8,218 14,381 15,186  37,785


Six months to 30 September 2017     
 Revenue 2,832  12,050  -   14,882 
 Production costs(2,212)(9,603) -  (11,815)
 Gross profit (loss) 620  2,447  -   3,067 
 Depreciation and impairment(747)(510)(2)(1,259)
 Profit (loss) on sale of property, plant and equipment 29  -   -   29 
 Share option and warrant expense -   -   -   -  
 Sundry income 90  166  -   256 
 Exchange (loss) gain 1,032  -   120  1,152 
 Other administrative and overhead expenses(1,120)(289)(1,278)(2,687)
 Finance income -   20  -   20 
 Finance expense -  (575)(101)(676)
 Loss on disposal of subsidiary company loans -   -  (12,538)(12,538)
 Taxation (charge) -   -   -   -  
 Profit (loss) for the year from continuing operations(96) 1,258 (13,798)(12,636)
     
30 September 2017    
 Total assets 15,388  38,957  80  54,425 
 Total non-current assets 11,716  33,165 (487) 44,394 
 Additions to non-current assets 2,145  3,939  -   6,084 
 Total current assets 3,672  5,792  567  10,031 
 Total liabilities 5,278  14,447  15,328  35,053 

3       Loss per share

 30 Sep 201831 Mar 201830 Sep 2017
 UnauditedAuditedUnaudited
 Group GroupGroup
Loss per ordinary share has been calculated using the weighted average number of ordinary shares in issue during the relevant financial year.   
    
The weighted average number of ordinary shares in issue for the period is: 5,284,328,194  4,821,870,747   4,676,819,360 
    
Losses for the period:  ($’000)(4,510)(17,295)(13,619)
    
Loss per share basic and diluted (cents)(0.09)(0.36)(0.30)
    
The effect of all potentially dilutive share options is anti-dilutive.   



4          Property, Plant and equipment

Group Plant and machinery  Fixtures, fittings and equipment  Computer assets  Motor vehicles  Buildings and Improvements  Mining assets  Capital Work in progress  Total
   $’000  $’000  $’000  $’000  $’000  $’000  $’000  $’000
Cost at 1 April 20178,401  202  227  605  3,231  24,946  6,382  43,994  
Revaluation- - - - - - - - 
Additions during the year811 53 109 94 33 1,908 6,189 9,197 
Reclassification9,942 (30)30 - 242 194 (10,378)- 
Disposals during the year(131)(62)(78)(60)(28)(2)- (361)
Impairment- - - - (34)- - (34)
Foreign exchange movements224 7 3 60 296 385 50 1,025 
Cost at 31 March 201819,247  170  291  699  3,740 27,431  2,243  53,821  
Revaluation- - - - - - - - 
Additions during the period507 48 99 137 52 1,571 1,976 4,390 
Acquired through business combination2,319 20 - 2 1,790 - - 4,131 
Reclassification260 - - - 5 - (265)- 
Disposals during the period- - - - (87)- - (87)
Foreign exchange movements(186)(2)(6)(31)(168)(273)(61)(727)
Cost at 30 September 201822,147  236  384  807  5,332  28,729  3,893  61,528  
Depreciation at 1 April 20172,963  119  139  283  345  978  604  5,431  
Charge for the year1,826 21 79 114 152 670 - 2,862 
Disposals during the year(91)(62)(78)(34)(1)- - (266)
Foreign exchange movements100 5 - 42 42 71 - 260 
Depreciation at 31 March 20184,798  83  140  405  538  1,719  604  8,287  
Charge for the year1,532 16 42 28 76 414 - 2,108 
Disposals during the period- - - - - - - - 
Foreign exchange movements(98)(2)(3)(26)(54)(31)- (214)
Depreciation at 30 September 20186,232  97  179  407  560  2,102  604  10,181  
Net book value at 31 March 20175,438  83  88  322  2,886  23,968  5,778  38,563  
Net book value at 30 September 20176,049 54 170 241 3,268 24,518 9,629 43.929 
Net book value at 31 March 201814,449  87  151  294  3,202  25,712  1,639  45,534  
Net book value at 30 September 201815,915  139  205  400  4,772  26,627  3,289  51,347  



5       Inventory

 Sep 2018Mar 2018Sep 2017
 UnauditedAuditedUnaudited
 GroupGroupGroup
 $’000$’000$’000
    
 Minerals held for sale 1,908 1,484 1,029
 Production stockpiles 1,413 1,425 946
 Consumable stores 2,215 1,145 831
  5,536 4,054 2,806

6       Receivables

 Sep 2018Mar 2018Sep 2017
 UnauditedAuditedUnaudited
 GroupGroupGroup
 $’000$’000$’000
    
 Trade receivables 355 94 384
 Other receivables 2,392 1,145 520
 Short term loans -  789 526
 Prepayments 2,305 1,366 982
 VAT 3,969 2,012 3,078
  9,021 5,406 5,490

7       Loans and borrowings

 Sep 2018Mar 2018Sep 2017
 UnauditedAuditedUnaudited
 GroupGroupGroup
 $’000$’000$’000
    
 Non current    
 Secured borrowings 9,286  8,149  20,757 
 Unsecured borrowings 14,838  14,838  -  
 less amounts payable in less than 12 months(351)(352)(1,698)
    
  23,773  22,635  19,059 
 Current    
 Secured borrowings 3,451  -   -  
 Unsecured borrowings 4,813  2,664  1,253 
 Bank overdrafts 2,291  1,315  5,023 
 Current portion of long term borrowings 351  352  1,698 
    
  10,906  4,331  7,974 
 Total loans and borrowings 34,679  26,966  27,033 

8    Payables

 Sep 2018Mar 2018Sep 2017
 UnauditedAuditedUnaudited
 GroupGroupGroup
 $’000$’000$’000
    
    
 Trade payables 5,308 4,753 5,377
 Other payables 1,836 769 1,250
 Other taxes and social security taxes 530 478 160
 Accrued expenses 107 91 93
  7,781 6,091 6,880



9       Provisions

 Sep 2018Mar 2018Sep 2017
 UnauditedAuditedUnaudited
 GroupGroupGroup
 $’000$’000$’000
    
 Provision for rehabilitation of mining properties   
 - Provision brought forward from previous periods 1,397 1,095 1,095
 - Liability recognised during period 1,068 302 45
  2,465 1,397 1,140

10    Goodwill on consolidation of subsidiary

On 20th April 2018 the Company announced the acquisition, through its subsidiary Dallaglio Investments (Private) Limited, of the entire issued share capital of Delta Gold (Private) limited, which is the owner and operator of the Eureka Gold Mine in northern Zimbabwe. The Company’s effective share of ownership is 25.05%. The principal reason for this acquisition was to expand the Group’s mining operations.

Details of the provisional fair value of identifiable assets and liabilities acquired, purchase consideration and gain arising are as follows:

 Fair value
 $000’s
  
Property, plant and equipment4,131 
Cash and cash equivalents5 
 4.136 
Less: Payables(1,913)
Net assets 2,223 
  
Fair value of consideration paid - Cash 4,485 
  
Goodwill on acquisition 2,262 
Less attributable to Non-controlling Interests (1,695)
  566 

11       Events after the reporting date
Baita Plai licence
Commercial contract signed between the Company’s 80% owned subsidiary, African Consolidated Resources SRL and Baita SA giving the Company the right to mine at the Baita Plai Polymetallic Mine.

Shares issued

DateNo of SharesGross before costs - £Gross before costs - $Reason for issue
8-Oct-1813,9207092Exercise of warrants
16-Oct-1857,331287372Exercise of warrants
18-Oct-1870,847,785425,086552,612Placing to investors
18-Oct-1816,666,666100,000130,000Subscription by directors
2-Nov-18188,679,2451,000,0001,300,000Placing to investors
5-Dec-18153,810769980Exercise of warrants
7-Dec-18576,8352,8843,676Exercise of warrants
19-Dec-1868,000,00068,00086,098Bergen transaction

**ENDS**