Unaudited interim financial statements

For immediate release: 24 December 2009 Emerging Metals Limited ("EML", "Emerging Metals" or "the Company") Unaudited interim financial statements for the six month period ended 30 September 2009 Emerging Metals Limited (AIM: EML), the mining company focused on minor and emerging metals, today announces its interim results for the six month period ended 30th September 2009. FINANCIAL AND OPERATIONAL HIGHLIGHTS * Equity shareholder funds increased 52% to £40,639,903 (31 March 2009: £26,652,271); * non-current assets valuation maintained at £5,319,860 (31 March 2009: £5,319,860); * current assets valuation increased 65% to £35,392,803 (31 March 2009: £21,392,111); * net profits of £13,916,315 achieved for period compared to a loss of £240,270 at 30 September 2008; * holdings in Kalahari Minerals and Extract Resources valued at £34,703,396 as at 30 September 2009 against a purchase price of £10,024,164 - a rise of 246% - of which £14,419,739 was within period; * 9.06% of Kalahari Minerals Plc held at an average cost of 54.50 pence per share (31 March 2009: 8.04% held at an average cost of 45.04 pence per share); * 0.17% of Extract Resources Limited held at an average cost of A$1.1909 per share (31 March 2009: 0.17% held at an average cost A$1.1945 per share); * Tsumeb option remains valued at £4,818,455 (31 March 2009: £4,818,455); * operating expenses kept below budget at £347,952 (30 September 2008: £726,371); * cash reserves at 30 September 2009 of £683,176 following investment acquisitions in period (31 March 2009: £3,757,960). Co-chairman Stephen Dattels commented: "The acquisition of our interests in Kalahari Minerals and Extract Resources has given Emerging Metals exposure to a world class uranium resource - namely the Husab project in Namibia comprising the Rössing South, Ida Dome and Hildenhof deposits. Not only is uranium an emerging metal with a very favourable long term supply-demand outlook, the interests also allow Emerging Metals to leverage its existing platform and operations at Tsumeb in Namibia. "Our half year results to 31 March 2009 are consequently extremely pleasing, with a positive net income for the period of £13,916,315 (31 March 2008: loss of £240,270), including an investment gain of £14,419,739 to a valuation of £ 34,703,396 (31 March 2008: £17,627,774)." --Ends-- Contact details Emerging Metals Blomfield Corporate Fox-Davies Capital GTH Limited Finance Limited Limited Communications Denham Eke Toby Howell Daniel Fox-Davies Toby Hall Peter Trevelyan-Clark +44 (0) 1624 639396 +44 (0) 20 7444 +44 (0) 20 7936 +44 (0) 20 7153 0541 5200 8035 Chairmen's statement As previously reported, Emerging Metals Limited continues studies and test work on the Tsumeb Slag stockpiles. As the current market conditions for the contained metals - germanium, zinc and gallium - remains weak, we are continuing to contain costs on the Tsumeb Slag stockpiles. We will, however, reassess this strategy as market conditions change. We have continued with our strategy of acquiring strategic stakes in quoted companies involved with investment metals. As at the end of the half year, we held 9.06% of the issued capital of Kalahari Minerals Plc and 0.17% of the issued capital of Extract Resources Limited: acquired at an aggregate cost of £ 10 million. As previously reported, Kalahari Minerals is a London AIM and Namibian Stock Exchange traded exploration and development company whose principal asset is a near 40% interest in Extract Resources, an Australian ASX and Toronto Stock Exchange listed uranium exploration and development company with significant uranium assets in Namibia, namely the Husab uranium project comprising the Rössing South, Ida Dome and Hildenhof deposits. Recently reported chemical assay results continue to confirm the presence of high grade granite hosted uranium mineralisation. Rössing South Zones 1 and 2 extend for over five kilometres indicating an increased resource of up to 500 Mlb with 13 drill rigs operating on site, with more rigs being sourced to accelerate exploration and resource definition efforts. These high grade results bode well for the future valuation of Extract Resources and hence Kalahari Minerals, providing the price of uranium remains firm. The global move to produce clean energy to cut emissions, not only in Asia, but also in Europe and elsewhere will, we believe, create a very important positive long term demand and driver for uranium prices. As an indication, according to the World Nuclear Association, currently there are 435 operating reactors around the world, with a further 53 under construction, 136 planned and 299 have been proposed. Thus the acquisition of this interest in Kalahari Minerals and Extract Resources gives Emerging Metals exposure to a world class uranium resource, an emerging metal with a very favourable long term supply-demand outlook. It also leverages on Emerging Metals existing platform and operations at Tsumeb in Namibia. Our half year results to 31 March 2009 are consequently extremely pleasing, with a positive net income for the period of £13,916,315 (31 March 2008: loss of £240,270), including an investment gain of £14,419,739 to a valuation of £ 34,703,396 (31 March 2008: £17,627,774). Operating expenses were well below budget at £347,952 (31 March 2008: £726,371), with the directors continuing to take their remuneration half in cash and half in shares valued at market at each month end. As a result, equity shareholder funds have increased to £40,639,903 (31 March 2008: £26,652,271), a rise of 52%. Fixed assets stand unchanged at £5,319,860 (31 March 2008: 5,319,860), current assets at £35,392,803 (31 March 2008: £ 21,392,111). Our cash reserves stood at £683,176 (31 March 2008: £3,757,960). We would like to express our appreciation to our shareholders for their continued support. Stephen Dattels Co-chairman James Mellon Co-chairman Statement of comprehensive income Notes For the For the For the period from period from period from 1 April 1 April 1 April 2009 to 30 2008 to 30 2008 to 31 September September March 2009 2009 2008 (Audited) (Unaudited) (Unaudited) £ £ £ Income - - - Other income Exchange gains - 446,036 798,146 Investment gains 14,419,739 - 10,259,493 ────── ────── ────── 14,419,739 446,036 11,057,639 Operating expenses Directors fees 7 (156,007) (153,526) (344,899) Other costs 3 (347,952) (726,371) (973,230) ────── ────── ────── (503,959) (879,897) (1,318,129) ────── ────── ────── Net profit/(loss) before interest 13,915,780 (433,861) 9,739,510 Interest received 1(g) 535 193,591 266,423 ────── ────── ────── Profit/(loss) before taxation 13,916,315 (240,270) 10,005,933 Taxation 8 - - - ────── ────── ────── Total comprehensive income for the 13,916,315 (240,270) 10,005,933 period ────── ────── ────── Earnings per share 14 0.0421 (0.0007) 0.0306 ────── ────── ────── Diluted earnings per share 14 0.0393 (0.0007) 0.0285 ────── ────── ────── The Directors consider that the Company's activities are continuing. The notes on pages 8 to 18 form part of these interim financial statements. Statement of financial position Notes Unaudited at Unaudited at Audited at 30 September 30 September 31 March 2009 2008 2009 £ £ £ Assets Non-current assets Land options 1(c),4 4,818,455 4,818,455 4,818,455 Intangible Fixed Assets 1(d) 501,405 349,168 501,405 ────── ────── ────── 5,319,860 5,167,623 5,319,860 Current assets Investments 1(e) 34,703,396 - 17,627,774 Trade and other receivables 1(h) 6,231 6,277 6,377 Cash and cash equivalents 1(h) 683,176 11,229,118 3,757,960 ────── ────── ────── 35,392,803 11,235,395 21,392,111 ────── ────── ────── Total assets 40,712,663 16,403,018 26,711,971 ══════ ══════ ══════ Equity and liabilities Capital and reserves Share capital 5 - - - Share premium 5 14,560,530 14,560,530 14,560,530 Share Option Reserve 6 3,504,144 3,504,144 3,504,144 Equity Share Based Payment 1(l) 151,557 - 80,240 Reserve Accumulated profit / (loss) 22,423,672 (1,738,846) 8,507,357 ────── ────── ────── Total equity 40,639,903 16,325,828 26,652,271 Current liabilities Trade and other payables 72,760 77,190 59,700 ────── ────── ────── Total equity and 40,712,663 16,403,018 26,711,971 liabilities ══════ ══════ ══════ The notes on pages 8 to 18 form part of these interim financial statements. Statement of changes in equity Share Share Share Share Accumulated Total Premium Option Based Capital Profits / Option (Losses) Reserves Payments £ £ £ £ £ £ Balance at 31 11,831,373 3,504,144 - - (1,498,576) 13,836,941 March 2008 Total - - - - (240,270) (240,270) comprehensive income for the period Shares issued 2,729,157 - - - - 2,729,157 Fair value of - - - - - - share options Share based - - - - - - payment reserve ────── ─────── ─────── ────── ─────── ─────── Balance at 30 14,560,530 3,504,144 - - (1,738,846) 16,325,828 September 2008 ══════ ═══════ ═══════ ══════ ═══════ ═══════ Share Share Share Share Accumulated Total Premium Option Based Capital Profits / Option (Losses) Reserves Payments £ £ £ £ £ £ Balance at 31 14,560,530 3,504,144 80,240 - 8,507,357 26,652,271 March 2009 Total - - - - 13,916,315 13,916,315 comprehensive income for the period Shares issued - - - - - - Fair value of - - - - - - share options Share based - - 71,317 - - 71,317 payment reserve ────── ─────── ─────── ────── ─────── ─────── Balance at 30 14,560,530 3,504,144 151,557 - 22,423,672 40,639,903 September 2009 ══════ ═══════ ═══════ ══════ ═══════ ═══════ The notes on pages 8 to 18 form part of these interim financial statements. Statement of cash flows Notes For the For the For the period from period from period from 1 April 2009 1 April 2008 1 April to 30 to 30 2008 to 31 September September March 2009 2009 2008 (Audited) (Unaudited) (Unaudited) £ £ £ Cash flows from operating 9 (418,901) (207,032) (157,672) activities Cash flows from investing activities Amount paid in cash for intangible - (349,168) (501,405) fixed assets Amount paid in cash for investments (2,655,883) - (7,368,281) Cash flows from financing activities Increase in share premium - 2,729,157 2,729,157 ────── ────── ────── (Decrease) / increase in cash and (3,074,784) 2,172,957 (5,298,201) cash equivalents Cash and cash equivalents at 3,757,960 9,056,161 9,056,161 beginning of period ────── ────── ────── Cash and cash equivalents at the 683,176 11,229,118 3,757,960 end of period ══════ ══════ ══════ The notes on pages 8 to 18 form part of these interim financial statements. Notes (forming part of the interim financialstatements for the six months ended 30 September 2009) 1 Accounting policies Emerging Metals Limited is a company domiciled in the British Virgin Islands. The interim financial statements incorporate the principal accounting policies set out below. a) Statement of compliance The interim financial statements are prepared in accordance with International Financial Reporting Standards (IFRS) and the interpretations adopted by the International Accounting Standards Board (IASB). The directors' do not expect the adoption of the other current upcoming and new IFRS standards and interpretations to have a material impact on the Company's interim financial statements in the period of initial application. b) Basis of preparation The preparation of interim financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision only affects that period or in the period of the revision and future periods if the revision affects both current and future periods. The key estimate and judgement made by the Directors is the fair value of the land option. The following new standard has been adopted with effect from 1 April 2009: • IAS 1 (revised), `Presentation of financial statements'; c) Land options Land options are stated at fair value, as estimated by the Directors. This is estimated to be the current market value of the options. There will be no amortisation of the premium paid. d) Intangible assets Exploration rights and associated survey costs are capitalised as incurred and reviewed annually for impairment and are carried at cost less accumulated impairment losses. e) Investments Investments are acquired to realise gains from fluctuations in the prices or margins of traders. These assets are valued at fair value based on quoted bid prices. Any realised and unrealised gains and losses are presented within `Other Income'. f) Impairment The carrying amounts of the Company's assets are reviewed at least at each balance sheet date to determine whether there is any indication of impairment. If there is any indication that an asset may be impaired, its recoverable amount is estimated. The recoverable amount is the higher of its net selling price and its value in use. In assessing value in use, the expected future cash flows from the asset are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. An impairment loss is recognised whenever the carrying amount of an asset exceeds its recoverable amount. For an asset that does not generate cash inflows that are largely independent of those from other assets, the recoverable amount is determined for the cash-generating unit to which the asset belongs. An impairment loss is recognised in the income statement whenever the carrying amount of the cash-generating unit exceeds its recoverable amount. A previously recognised impairment loss is reversed if the recoverable amount increases as a result of a change in the estimates used to determine the recoverable amount, but not to an amount higher than the carrying amount that would have been determined (net of depreciation) had no impairment loss been recognised in prior years. g) Income Interest income has been earned during the period, which is accrued on a time apportion basis, by reference to the principal outstanding and the effective interest rate applicable. h) Financial instruments Measurement Financial instruments are initially measured at cost, which includes transaction costs. Subsequent to initial recognition these instruments are measured as set out below. Land options Land options are stated at fair value, as estimated by the Directors. This is estimated to be the current market value of the options. There will be no amortisation of the premium paid. Trade and other receivables Trade and other receivables originated by the Company are stated at amortised cost less impairment losses. Cash and cash equivalents Cash and cash equivalents are measured at fair value and due on demand. Financial liabilities Non-derivative financial liabilities are recognised at amortised cost. i) Provisions Provisions are recognised when the Company has a present legal or constructive obligation as a result of past events, for which it is probable that an outflow of economic benefits will occur, and where a reliable estimate can be made of the amount of the obligation. Where the effect of discounting is material, provisions are discounted. The discount rate used is a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. j) Foreign currencies Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated at the rate of exchange ruling at the balance sheet date. All differences are taken to the income statement. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. k) Share based payments Under IFRS 2 `Share Based Payments', the Company determines the fair value of options issued to Weatherly International plc as part consideration of the land option (as per the Tsumeb Option Agreement (note 4)) share option reserves in the balance sheet. The Company determines the fair value of options issued to Directors remuneration and recognises the amount as an expense in the income statement with a corresponding increase in equity. l) Directors equity share based payments The Company has granted equity share-based payments following a resolution passed in November 2008 for the directors of the company to accept 50% of their remuneration in the form of new shares issued at mid-market prices. The fair value of the incentive granted is recognised as an expense with a corresponding increase in equity. The fair value is measured at the grant date and spread over the period during which the directors become unconditionally entitled to the incentives. To date no shares have been issued to the directors under this scheme and as such is accounted for in a share based payment reserve at the period end. 2 Operating segments It is the Directors' opinion that the company operates within a single segment. 3 Other costs For the For the For the period from 1 period from 1 period from 1 April 2009 to April 2008 to April 2008 to 30 September 30 September 31 March 2009 2008 2009 (Audited) (Unaudited (Unaudited) £ £ £ Professional fees 213,714 647,915 824,854 Audit fee 11,825 - 15,000 Travel and transport 3,045 32,237 43,618 Office expenses 119,368 46,219 89,758 ──────── ──────── ──────── 347,952 726,371 973,230 ════════ ════════ ════════ 4 Land option The land option comprises the Tsumeb Option as described below and is stated at fair value. On 28 January 2008, the Company entered into an amended and restated option agreement with Ongopolo Mining Limited (OML), a company incorporated in Namibia (the "Tsumeb Option Agreement") under which the Company was granted an option to acquire all right, title and interest in and to the Tsumeb Slag Stockpiles (the "Tsumeb Option") in consideration of: i. the payment by the Company to OML, or as it directs, of £1,421,000 in cash; ii. the issue and allotment of 21,899,698 Ordinary Shares credited as fully paid to Weatherly International plc (Weatherly); and iii. the grant to Weatherly of an option over 13,705,179 Ordinary Shares. The consideration paid for the Tsumeb Option comprised £1,421,000 in cash, 21,899,698 ordinary shares issued as at zero par value to Weatherly at a cost of £0.05 per share. An option was also granted to Weatherly to subscribe for up to 13,705,179 ordinary shares at £0.05 per share, exercisable at any time for five years from the date of completion of the Tsumeb Option Agreement. A summary is as follows: Land option consideration For the For the For the period from 1 period from 1 period from 1 April 2009 to April 2008 to April 2008 to 30 September 30 September 31 March 2009 2009 2008 (Audited) (Unaudited) (Unaudited) £ £ £ Cash consideration 1,421,000 1,421,000 1,421,000 Shares issued at £0.05 per share 1,094,985 1,094,985 1,094,985 Fair value of share options 2,302,470 2,302,470 2,302,470 ─────── ─────── ─────── 4,818,455 4,818,455 4,818,455 ═══════ ═══════ ═══════ The grant of the Tsumeb Option was subject to a number of conditions, which were satisfied on 29 January 2008. The exercise term of the Tsumeb Option (the "Tsumeb Option Period") shall expire on the 30 month anniversary of the date of the satisfaction of the conditions, such period comprising a total of 24 months for completion of an initial programme of work, plus six months for a decision by the Company to proceed with commercial production from any portion of the Tsumeb Slag Stockpiles and announcement of that decision to AIM. Under the Tsumeb Option Agreement, OML provides the Company with a number of warranties regarding the Tsumeb Slag Stockpiles. In particular, OML warrants to the Company that: * it has the requisite power and authority to enter into and perform the Tsumeb Option Agreement; * it is, and will remain during the Tsumeb Option Period, the legal and beneficial owner of 100 per cent of the Tsumeb Slag Stockpiles; and * no further consent, approval or authorisation of any governmental agency or other person is required by it for the entry into and performance of its obligations under the Tsumeb Option Agreement. Under the Tsumeb Option Agreement, OML was required to provide the Company with a legal opinion from counsel duly qualified to practice in Namibia, confirming OML's 100 per cent. ownership of the Tsumeb Slag Stockpiles (the "OML Legal Opinion"). Under the Tsumeb Option Agreement, if OML was unable to supply the OML Legal Opinion, OML and the Company would enter a new agreement, agreed in good faith between the parties, establishing a contractual relationship between OML and the Company that would ensure that the Company was placed in the same economic position as was the intention under the Tsumeb Option Agreement - with the Company bearing the cost incurred and receiving the profit or other benefit arising out of the Tsumeb Slag Stockpiles. Under the Tsumeb Option Agreement, OML and the Company agreed that, in the event of termination of the Tsumeb Option Agreement, and in circumstances where the parties could not legally enter or enforce the Toll Gate Agreement for whatever reason, the parties agreed to take all such steps as necessary to return each other to the legal and financial position each was in prior to the execution of the Tsumeb Option Agreement. In particular, under the Tsumeb Option Agreement it is agreed that: * Weatherly and/or OML shall return to the Company all consideration paid under the Tsumeb Option Agreement together with interest at 2 per cent above the base rate from time to time of Barclays Bank PLC per annum accruing monthly; * Weatherly and/or OML shall return, transfer or cancel as directed by the Company all Ordinary Shares issued and allotted to Weatherly or OML under the Tsumeb Option Agreement; * Weatherly and/or OML shall return, cancel and/or extinguish all and any options over Ordinary Shares granted to Weatherly or OML pursuant to the Tsumeb Option Agreement; and * OML shall pay the reasonable costs of the Company incurred in the preparation, negotiation and completion of the obligations under the Tsumeb Option Agreement. 5 Share capital and share premium For the For the For the period from 1 period from 1 period from 1 April 2009 to April 2008 to April 2008 to 30 September 30 September 31 March 2009 2009 2008 (Audited) (Unaudited) (Unaudited) £ £ £ Authorised The Company is authorised to - - - issue an unlimited number of no par value shares of a single class Issued 330,759,300 ordinary shares of £ - - - 0.00 each Share premium 1 share at incorporation - - - 71,528,234 shares at £0.0001 per 7,153 7,153 7,153 share 214,584,704 shares at £0.0500 10,729,235 10,729,235 10,729,235 per share 21,899,698 shares at £0.0500 per 1,094,985 1,094,985 1,094,985 share 22,746,663 shares at £0.1200 per 2,729,157 2,729,157 2,729,157 share ──────── ──────── ──────── Total 14,560,530 14,560,530 14,560,530 ════════ ════════ ════════ 6 Share based payments A number of share options are in issue as at 30 September 2009: * 13,705,179 shares at £0.05 per share to Weatherly International plc for acquisition of the land option (note 4) issued on 21 January 2008. * 21,899,698 shares at £0.05 per share to the Founders issued on 28 January 2008. The following table lists the inputs to the models used for the six month period ended 30 September 2009: For the period For the period For the period from 1 April from 1 April from 1 April 2009 to 30 2008 to 30 2008 to 31 September 2009 September 2008 March 2009 (Unaudited) (Unaudited) (Audited) Dividend yield (%) - - - Expected volatility (%) 65 65 65 Risk-free interest rate (%) 5 5 5 Share price at grant date 0.05 0.05 0.05 Share price (market value) 0.20 0.20 0.20 Exercise price 0.05 0.05 0.05 All options were issued in prior periods. No options lapsed or were cancelled and no options were exercised during the six month period ended 30 September 2009. In summary, as at 30 September 2009, the value of the share options in issue is: Name Options in Date Granted Vesting Option Value issue Period Valuation (Years) Per Share £ £ Founders 7,152,823 21 January 2008 - 0.168 1,201,674 Weatherly 13,705,179 28 January 2008 - 0.168 2,302,470 International Limited ────── Total 3,504,144 ══════ 7 Directors Remuneration For the For the For the period from 1 period from 1 period from 1 April 2009 to April 2008 to April 2008 to 30 September 30 September 31 March 2009 2009 2008 (Audited) (Unaudited) (Unaudited) £ £ £ Directors Fees 156,007 153,526 344,899 ────── ────── ────── 156,007 153,526 344,899 ══════ ══════ ══════ The Company has no employees other than the Directors. 8 Taxation The Company is exempt from the provisions of the Income Tax Ordinance of the British Virgin Islands. 9 Notes to the cash flow statement Reconciliation of operating profit to net (outflow) from operating activities For the For the For the period from period from period from 1 April 2009 1 April 1 April 2008 to 30 2008 to 30 to 31 March September September 2009 2009 2008 (Audited) (Unaudited) (Unaudited) £ £ £ Operating profit / (loss) 13,916,315 (240,270) 10,005,933 Adjustment for: Decrease in trade and other 146 30,078 29,978 receivables Increase / (decrease) in trade and 13,060 3,160 (14,330) other payables Share based payment charge 71,317 - 80,240 Unrealised gains on investments (14,419,739) - (10,259,493) ────── ────── ────── Net cash (outflow) from operating (418,901) (207,032) (157,672) activities ══════ ══════ ══════ 10 Financial instruments The Company's financial instruments are exposed to a number of risks as detailed below: Credit risk The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk at the reporting date was: For the For the For the period from period from period from 1 April 2009 1 April 2008 1 April 2008 to 30 to 30 to 31 March September September 2009 2009 2008 (Audited) (Unaudited) (Unaudited) £ £ £ Cash and cash equivalents 683,176 11,229,118 3,757,960 The Company invests available cash and cash equivalents with an Isle of Man licensed bank, which has a strong history on the Island. The Company has a nominal level of debtors, and as such the Company is able to determine that credit risk is considered minimal in relation to debtors. Liquidity risk Liquidity risk is managed by the Company by means of cash flow planning to ensure that future cash requirements are anticipated. All liabilities are due within one month. Market price risk The Company is exposed to market price risk to the extent that it holds a land option for which no developed market exists. Therefore the Company might not be able to sell such a stake quickly at close to estimated fair value. All investments present a risk of loss of capital due to unexpected and unforeseen events in the financial markets, and these can have a material and unpredictable impact on the portfolio value. The maximum risk resulting from the portfolio is equivalent to their fair value. For the For the For the period from period from period from 1 April 2009 1 April 2008 1 April 2008 to 30 to 30 to 31 March September September 2009 2009 2008 (Audited) (Unaudited) (Unaudited) £ £ £ Land option 4,818,455 4,818,455 4,818,455 Intangible fixed assets 501,405 98,553 501,405 Investments 34,703,396 - 17,627,774 Interest rate risk The Company holds current assets in the form of cash at bank. As a result, the Company is subject to risk due to fluctuations in the prevailing level of market interest rates. The weighted average interest rate at the 30 September 2009 was 0.0152% (30 September 2008: 1.6428%) and all balances are held on demand. The directors do not regard that interest income is a core revenue stream of the Company and therefore fluctuations in interest rates will not adversely impact the continuing operations of the company. Fair values of financial instruments At 30 September 2009 the carrying amounts of cash resources, trade and other receivables, and trade and other payables approximate their fair values due to their short-term maturities. 11 Interest in shares Except for the interests disclosed in this note, the Directors are not aware of any holding of Ordinary Shares as at the date of these accounts representing 3% or more of the issued share capital of the Company: Number of Ordinary Percentage of Shares Issued Capital Vidacos Nominees Limited 103,256,500 31.22% Roy Nominees Limited 54,087,204 16.35% HSBC Global Custody Nominee (UK) 36,420,833 11.01% Limited Weatherley International Plc 21,899,698 6.62% Lynchwood Nominees Limited 13,375,000 4.04% Directors interests Stephen Dattels1 20,492,504 6.20% James Mellon2 28,205,684 8.53% Notes to Directors' Interests: 1 Stephen Dattels' shareholding includes 20,242,504 Ordinary Shares held by Belstone Investments Limited, which is beneficially owned by Stephen Dattels, and 250,000 Ordinary Shares held by Graham Dattels, a Connected Person. 2 Jim Mellon's entire shareholding is held by Galloway Limited, a company which is indirectly wholly owned by the trustee of a settlement under which Jim Mellon has a life interest. 12 Related Party Transaction The Company has entered into a service agreement with Burnbrae Limited for the provision of administrative and general office services. Mr J Mellon and Mr D Eke are both directors of Burnbrae Limited and the Company. During the six months period ended 30 September 2009 the Company paid £15,450 (30 September 2008: £15,383) under this agreement and as 30 September 2009 an amount of £227 (30 September 2008: £nil) was owed to Burnbrae Limited. 13 Subsequent events None identified at date of signing. 14 Earnings per share The calculation of basic earnings per share of the Group is based on the net profit attributable to shareholders for the six month period ended 30 September 2009 of £13,916,315 (30 September 2008: loss £240,270) and the weighted average number of shares of 330,759,300 (30 September 2008: 330,759,300) in issue during the ar. The calculation of diluted earnings per share of the Company includes the weighted average number of share options and shares to be issued in respect of share based payments (see note 1(l)) for the six month period ended 30 September 2009.

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