Interim results for the half-year ended 30 June...
AIM: KEFI 10 September 2012
KEFI Minerals Plc
("KEFI Minerals" or the "Company")
INTERIM RESULTS FOR THE HALF-YEAR ENDED 30 JUNE 2012
KEFI Minerals, an AIM-quoted gold and copper exploration company with projects
in the Kingdom of Saudi Arabia, is pleased to announce its unaudited interim
results for the half-year ended 30 June 2012.
Highlights of the Half-Year Period
* The Gold and Minerals JV ("G&M") in Saudi Arabia was granted 2 Exploration
Licences (ELs) by the Kingdom of Saudi Arabia's Deputy Ministry for Mineral
Resources in January 2012 and a further 1 EL (outside the reporting period,
on 4 July 2012). The G&M JV has now 4 granted ELs and 19 EL applications.
* Exploration work at the Selib North project defined new gold-bearing dykes
at the Camel Hill prospect with best trench results of 17m at 3.4 g/t Au.
Diamond drilling commenced in July 2012.
* Exploration at the Jibal Qutman prospect returned rock chip channel samples
of up to 4m at 9.36 g/t Au and 93 g/t Ag and trench sampling carried out
outside the reporting period in July returned best results of 3.2m at 27.7
g/t Au and 262 g/t Au.
* The Company decided to allow its exclusivity period, over the tailings
retreatment project and mining of remnant ore at the Tiouit Mine in
Morocco, to lapse. The due diligence and evaluation work that was conducted
during the exclusivity period, since July 2011, demonstrated less potential
than initially envisaged.
* In February 2012, raised £1,850,000 via a placing at 3p per share.
* In August 2012, raised £966,000 via a placing to 3 members of the Al Rashid
family at 2.3p per share.
Jeffrey Rayner, Managing Director of KEFI Minerals, commented:
"KEFI Minerals through the G&M JV in Saudi Arabia has made excellent progress
in 2012. Our exploration work has led to new gold discoveries and early drill
target definition. Diamond drilling has commenced at the Selib North prospect
and is due to start at the Jibal Qutman prospect in early September 2012. The
Company's strategy is very cost-effective with every one of our highly
dedicated full-time personnel focused on activities in the field."
Enquiries:
KEFI Minerals Fox-Davies Capital Bishopsgate Communications
Jeffrey Rayner Simon Leathers Nick Rome
+90 533 928 19 13 +44 203 463 5022 +44 207 562 3366
www.kefi-minerals.com
References in this announcement to exploration results and potential have been
approved for release by Mr Jeffrey Rayner (BSc.Hons). Mr Rayner is a geologist
and has more than 25years relevant experience in the field of activity
concerned. He is a member of the Australasian Institute of Mining and
Metallurgy (AusIMM) and has consented to the inclusion of the material in the
form and context in which it appears.
Managing Director's Report
The Company has been advancing its prospects in Saudi Arabia with the G&M JV.
The Arabian Shield is under-explored and has excellent potential for discovery
of major gold and copper mines. We will continue to progress effective
exploration programmes that aim to fast-track gold discovery and eventual
development of new mines.
Exploration - Saudi Arabia
The Gold & Minerals Joint Venture has been granted a further 3 ELs up to July
2012, bringing the total to 4 ELs and 19 ELAs. Exploration work in 2012 has
involved surface mapping, reconnaissance sampling, trenching and initiated in
July diamond drilling at the Selib North prospect.
New gold structures have been discovered at the Selib North prospect hosted in
pyritic dykes and sampling of trenches revealed best results of 17m at 3.4 g/t
Au. The dykes have been mapped over an extensive area and geophysics is planned
to locate the mineralised dykes at depth.
Diamond drilling commenced in July and drill results are pending.
The Company released encouraging trench results from the Jibal Qutman prospect,
in July 2012, outside the reporting period. Mapping and sampling has extended
the quartz vein field to over 3km in strike and discovered new veins. The veins
are generally 2-5m thick and highlights from initial sampling of the unmined
portions of the trenches include the following:
* 3.2 m at 27.7 g/t Au and 262 g/t Ag
* 4.0 m at 14.9 g/t Au and 84 g/t Ag
* 5.0 m at 10.9 g/t Au and 56 g/t Ag
* 4.2 m at 4.6 g/t Au and 35 g/t Ag
* 2.0 m at 7.2 g/t Au and 58 g/t Ag and
* 19.0 m at 1.9 g/t Au.
Diamond drilling is scheduled to commence at Jibal Qutman in early September
2012.
At the Hikyrin South licence, samples taken from the waste dumps of the ancient
Houimedan West mine have returned grades of up to 16.3 g/t Au and averaged 5.9
g/t Au from 24 samples spread over a 700m strike length. The veins are
generally narrow and extend over 1km.
Permitting of the 19 ELAs is continuing and the G&M JV is expecting further
licence grants in H2 2012.
Outlook
The Arabian Shield is recognised as under-explored and is very prospective for
discoveries of large gold and copper deposits.
KEFI Minerals continues to develop its tenement position within the Kingdom of
Saudi Arabia as a 40% equity holder and operator of the Gold and Minerals Joint
Venture with ARTAR.
KEFI Minerals will continue its current exploration efforts in a very
cost-effective manner while evaluating further opportunities in the region. We
are fully focused on expanding G&M's presence in the Kingdom of Saudi Arabia
and are encouraged by our results thus far. The Company is well funded to
continue with the 12,000m drilling programme planned on the granted ELs and
those expected in the second half of 2012.
KEFI MINERALS PLC
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2012
Contents
Page
Condensed Interim Consolidated Statement of Comprehensive Income 4
Condensed Interim Consolidated Statement of Financial Position 5
Condensed Interim Consolidated Statement of Changes in Equity 6
Condensed Interim Consolidated Statement of Cash Flows 7
Notes to the Condensed Interim Consolidated Financial Statements 8-15
Review Report 16
KEFI MINERALS PLC
CONDENSED INTERIM CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED 30 JUNE 2012
(UNAUDITED)
Six months Six months
ended ended 30
June 2011
30 June 2012
Notes GBP'000 GBP'000
Revenue - -
Exploration costs (2) (118)
Gross loss (2) (118)
Administrative expenses (563) (367)
Share-based payments (121) (82)
Share of loss from jointly controlled (117) (74)
entity
Impairment of other receivables - (28)
Other loss (19) -
Operating loss (822) (669)
Foreign exchange gain 67 18
Loss before tax (755) (651)
Tax - -
Loss for the period (755) (651)
Other comprehensive loss:
Exchange differences on translating (54) (39)
foreign operations
Total comprehensive loss for the period (809) (690)
Basic and fully diluted loss per share 4 0.19 0.18
(pence)
The notes on pages 8 to 15 form an integral part of these condensed interim
consolidated financial statements. KEFI MINERALS PLC
CONDENSED INTERIM CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2012
(UNAUDITED)
30 June 30 June 31 Dec
2012 2011 2011
Notes GBP'000 GBP'000 GBP'000
ASSETS
Non-current assets
Property, plant and equipment 5 2 15 2
Fixed asset investments 181 181 181
183 196 183
Current assets
Financial assets at fair value through 22 - 43
profit or loss
Trade and other receivables 6 83 169 86
Cash and cash equivalents 1,572 1,372 640
1,677 1,541 769
Total assets 1,860 1,737 952
EQUITY AND LIABILITIES
Equity attributable to owners of the
Company
Share capital 7 4,267 3,648 3,650
Share premium 3,843 2,712 2,719
Share options reserve 8 506 336 385
Foreign exchange reserve (224) (246) (170)
Accumulated losses (6,638) (4,968) (5,883)
1,754 1,482 701
Non-current liabilities
Share of loss in joint ventures - 89 -
- 89 -
Current liabilities
Trade and other payables 10 106 166 251
106 166 251
Total liabilities 106 255 251
Total equity and liabilities 1,860 1,737 952
The notes on pages 8 to 15 form an integral part of these condensed interim
consolidated financial statements.
KEFI MINERALS PLC
CONDENSED INTERIM CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 JUNE 2012
(UNAUDITED)
Share Share Share Foreign Accumulated Total
premium options exchange
capital reserve reserve losses
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 January 2011 3,311 1,697 396 (207) (4,459) 738
Comprehensive loss for - - - - (651) (651)
the period
Other comprehensive - - - (39) - (39)
loss
Issue of share capital 337 1,106 - - - 1,443
Share issue costs - (91) - - - (91)
Recognition of - - 82 - - 82
share-based payments
Exercise of options/ - - (73) - 73 -
warrants
Forfeit of options/ - - (69) - 69 -
warrants
At 30 June 2011 3,648 2,712 336 (246) (4,968) 1,482
Comprehensive loss for - - - - (941) (941)
the period
Other comprehensive - - - 76 - 76
income
Issue of share capital 2 7 - - - 9
Recognition of - - 75 - - 75
share-based payments
Forfeit of options/ - - (26) - 26 -
warrants
At 31 December 2011 3,650 2,719 385 (170) (5,883) 701
Comprehensive loss for - - - - (755) (755)
the period
Other comprehensive - - - (54) - (54)
loss
Issue of share capital 617 1,233 - - - 1,850
Share issue costs - (109) - - - (109)
Recognition of - - 121 - - 121
share-based payments
At 30 June 2012 4,267 3,843 506 (224) (6,638) 1,754
The following describes the nature and purpose of each reserve within Group's
equity:
Reserve Description and purpose
Share capital amount subscribed for share capital at nominal value
Share premium amount subscribed for share capital in excess of nominal
value, net of issue expenses
Share options reserve for share options granted but not exercised or
reserve lapsed
Accumulated losses cumulative net gains and losses recognised in the
statement of comprehensive income, excluding foreign
exchange gains within other comprehensive income
Foreign exchange cumulative foreign exchange net gains and losses
reserve recognised on consolidation
The notes on pages 8 to 15 form an integral part of these condensed interim
consolidated financial statements.
KEFI MINERALS PLC
CONDENSED INTERIM CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED 30 JUNE 2012
(UNAUDITED)
Six months Six months
to 30 June to 30 June
2012 2011
Notes GBP'000 GBP'000
CASH FLOWS FROM OPERATING ACTIVITIES
Loss before tax (755) (651)
Adjustments for:
Depreciation of property, plant and equipment 5 - 5
Share-based benefits 121 82
Profit on disposal of property, plant and
equipment
Share of loss in joint venture 117 74
Impairment of receivables - 28
Fair value losses on financial assets at fair 21 -
value through profit or loss
Foreign exchange losses/(gains) on financing 11 (14)
activities
Foreign exchange gains on operating activities (67) 6
(552) (470)
Changes in working capital:
Trade and other receivables 2 (65)
Trade and other payables (145) 46
Net cash used in operating activities (695) (489)
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of property, plant and 3 -
equipment
Advances to joint venture (117) (30)
Net cash from/(used in) investing activities (114) (30)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of share capital 1,850 1,443
Listing and issue costs (109) (91)
Net cash from financing activities 1,741 1,352
Net increase in cash and cash equivalents 932 833
Cash and cash equivalents:
At beginning of period 640 539
At end of period 1,572 1,372
The notes on pages 8 to 15 form an integral part of these condensed interim
consolidated financial statements. KEFI MINERALS PLC
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2012
1. Incorporation and principal activities
Country of incorporation
The Company was incorporated in United Kingdom as a public limited company on
24 October 2006. Its registered office is at 27/28 Eastcastle Street, London
W1W 8DH.
Principal activities
The principal activities of the Group for the period are:
* To explore for mineral deposits of precious and base metals and other
minerals that appear capable of commercial exploitation, including
topographical, geological, geochemical and geophysical studies and
exploratory drilling.
* To evaluate mineral deposits determining the technical feasibility and
commercial viability of development, including the determination of the
volume and grade of the deposit, examination of extraction methods,
infrastructure requirements and market and finance studies.
* To develop, operate mineral deposits and market the metals produced.
2. Summary of significant accounting policies
The principal accounting policies applied in the preparation of these condensed
interim consolidated financial statements are set out below. These policies
have been applied consistently throughout the period presented in these
condensed interim consolidated financial statements unless otherwise stated.
Basis of preparation and consolidation
The condensed interim consolidated financial statements have been prepared in
accordance with International Accounting Standards (IFRS) including
International Accounting Standard 34 "Interim Financial Reporting" and using
the historical cost convention.
These condensed interim consolidated financial statements (`the statements")
are unaudited and include the financial statements of the Company and its
subsidiary undertakings. They have been prepared using accounting bases and
policies consistent with those used in the preparation of the financial
statements of the Company and the Group for the year ended 31 December 2011.
These statements do not include all of the disclosures required for annual
financial statements, and accordingly, should be read in conjunction with the
financial statements and other information set out in the Company's 31 December
2011 Annual Report. The accounting policies are unchanged from those disclosed
in the annual consolidated financial statements.
Going concern
The Directors have formed a judgment at the time of approving the condensed
interim consolidated financial statements that there is a reasonable
expectation that the Company has adequate resources to continue in operational
existence for the foreseeable future. The financial statements have been
prepared on a going concern basis, the validity of which depends principally on
the discovery of economically viable mineral deposits, obtaining the necessary
mining licences and the availability of subsequent funding to extract the
resource or alternatively the availability of funding to extend the Company's
exploration activities. The financial statements do not include any adjustment
that would arise from a failure to complete any of the above. Changes in future
conditions could require write downs of the carrying values of property, plant
and equipment, intangible assets and/or deferred tax.
KEFI MINERALS PLC
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2012
2. Summary of significant accounting policies (continued)
Use and revision of accounting estimates
The preparation of the condensed interim consolidated financial statements
requires the making of estimations and assumptions that affect the recognised
amounts of assets, liabilities, revenues and expenses and the disclosure of
contingent liabilities. 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 judgments 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 affects only that period or in the
period of the revision and future periods if the revision affects both current
and future periods.
Adoption of new and revised International Financial Reporting Standards (IFRSs)
The Group has adopted all the new and revised IFRSs and International
Accounting Standards (IAS) which are relevant to its operations and are
effective for accounting periods commencing on 1 January 2012. The adoption of
these Standards did not have a material effect on the condensed interim
consolidated financial statements.
At the date of authorisation of these condensed interim consolidated financial
statements some Standards were in issue but not yet effective. The Board of
Directors expects that the adoption of these Standards in future periods will
not have a material effect on the consolidated financial statements of the
Group.
Critical accounting estimates and judgements
Estimates and judgments are continually evaluated and are based on historical
experience and other factors, including expectations of future events that are
believed to be reasonable under the circumstances.
The Group makes estimates and assumptions concerning the future. The resulting
accounting estimates will, by definition, seldom equal the related actual
results. The estimates and assumptions that have a significant risk of causing
a material adjustment to the carrying amounts of assets and liabilities within
the next financial year are unchanged from those disclosed in the annual
consolidated financial statements.
3. Operating segments
The Group has only one distinct operating segment, being that of mineral
exploration. The Group's exploration activities are located in Turkey and
Bulgaria and its administration and management is based in Cyprus.
2012 Cyprus Turkey Bulgaria Total
GBP'000 GBP'000 GBP'000 GBP'000
Operating loss (660) (45) - (705)
Foreign exchange gain/(loss) 10 62 (5) 67
Loss before tax (650) 17 (5) (638)
Share of loss from jointly (117)
controlled entities
Tax -
Loss for the period (755)
Total assets 1,755 78 3 1,836
Total liabilities 87 2 17 106
Depreciation of property, plant and - - - -
equipment
KEFI MINERALS PLC
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2012
3. Operating segments (continued)
2011 Cyprus Turkey Bulgaria Total
GBP'000 GBP'000 GBP'000 GBP'000
Operating loss (446) (121) (567)
Foreign exchange (loss)/gain (3) 7 14 18
(449) (114) 14 (549)
Share of loss from jointly controlled (74)
entities
Impairment of other receivables (28)
Loss before tax (651)
Tax -
Loss for the period (651)
Total assets 1,526 205 6 1,737
Total liabilities 138 99 18 255
Depreciation of property, plant and - 5 - 5
equipment
4. Loss per share
The calculation of the basic and fully diluted loss per share attributable to
the ordinary equity holders of the parent is based on the following data:
Six months Six months
to 30 June to 30 June
2012 2011
GBP'000 GBP'000
Net loss attributable to equity shareholders (755) (651)
Average number of ordinary shares for the purposes of 409,130 358,688
basic loss per share (`000s)
Basic and fully diluted loss per share (pence) 0.19 0.18
The diluted loss per share is the same as the basic loss per share as the
exercise of the share options would decrease the basic loss per share, thus
being anti-dilutive.
KEFI MINERALS PLC
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2012
5. Property, plant and equipment
Cost Motor Furniture, Total
fixtures
vehicles
and office
equipment
GBP'000 GBP'000 GBP'000
1 January 2011 72 21 93
Disposals (24) - (24)
Exchange difference on translation of (17) (8) (25)
subsidiaries
At 31 December 2011 31 13 44
Disposals - (2) (2)
At 30 June 2012 31 11 42
Accumulated Depreciation 56 10 66
At 1 January 2011
Charge for the period 2 1 3
Disposals (24) - (24)
Exchange difference on translation of (3) - (3)
subsidiaries
At 31 December 2011 31 11 42
Charge for the period - - -
Disposals - (2) (2)
At 30 June 2012 31 9 40
Net Book Value at 30 June 2012 - 2 2
Net Book Value at 31 December 2011 - 2 2
6. Trade and other receivables 30 June 30 June 31 Dec
2012 2011 2011
GBP'000 GBP'000 GBP'000
Trade receivables - 3 3
Amount receivable from Saudi Arabia Joint 39 30 39
Venture
Other receivables - 99 -
Deposits and prepayments 44 37 44
83 169 86
7. Share capital Number Share Share Total
of capital premium
shares GBP'000
'000 GBP'000 GBP'000
Issued and fully paid
At 1 January 2012 365,180 3,650 2,719 6,369
Issued 22 February 2012 at GBP0.03 61,666 617 1,233 1,850
Share issue costs - - (109) (109)
At 30 June 2012 426,846 4,267 3,843 8,110
KEFI MINERALS PLC
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2012
7. Share capital (continued)
Issued capital
2012
On 22 February 2012, 61,667,000 shares of GBP 0.01 were issued at a price of
GBP 0.03 Upon the issue an amount of GBP 1,233,000 was credited to the
Company's share premium reserve.
Warrants
2012
On 22 February 2012, the Company issued 2,917,000 warrants to subscribe for new
ordinary shares of GBP 0.01 each at GBP 0.03 per share.
Details of warrants outstanding as at 30 June 2012:
Grant date Expiry date Exercise price Number of
warrants
GBP 000's
20 October 2010 19 October 2013 0.0125 830
22 February 2011 21 February 2016 0.0500 780
22 February 2012 21 February 2017 0.0300 2,917
4,527
The Company has issued warrants to advisers to the Group. All warrants, except
those noted below expire five years after grant date and are exercisable at the
exercise price.
Number of
warrants
000's
Outstanding warrants at 1 January 2012 1,610
- granted 2,917
- exercised / expired -
Outstanding warrants at 30 June 2012 4,527
8. Share options reserve
9.
30 31
30 June 2012 June Dec
2011
2011
GBP'000 GBP'000 GBP'000
Opening amount 385 396 396
Recognition of share based 121 82 157
payments - options and warrants
Exercise/cancellation/forfeiture - (142) (168)
of options and warrants
Closing amount 506 336 385
Number of
shares
'000
Outstanding options at 1 January 2012 26,335
-granted -
-cancelled (500)
-exercised / expired -
Outstanding options at 30 June 2012 25,835
KEFI MINERALS PLC
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2012
9. Joint Venture Agreements
9.1 Joint Venture with Centerra Gold (KB) Inc.
On 22 October 2008, the company entered into a Joint Venture Agreement ("Joint
Venture Agreement") in respect of its 100%-owned Artvin Project with Centerra
Gold (KB) Inc ("Centerra KB"), a wholly-owned subsidiary of Centerra Gold Inc.
In August 2011, KEFI Mineral's subsidiary holding these licences, was sold in
return for a cash payment of US$100,000 and a 1% Net Smelter Royalty on all
future mineral production from the Artvin licences.
9.2 Joint Venture with Gold and Minerals
In May 2009, KEFI Minerals announced the formation of a new minerals
exploration joint venture, Gold & Minerals ("G&M") Joint Venture, with leading
Saudi construction and investment group Abdul Rahman Saad Al-Rashid & Sons
Company Limited ("ARTAR"). KEFI Minerals is the operating partner with a 40%
shareholding of the G&M Joint Venture with ARTAR holding the other 60%.
KEFI Minerals provides the G&M Joint Venture with technical advice and
assistance, including personnel to manage and supervise all exploration and
technical studies. ARTAR provides administrative advice and assistance to
ensure that the G&M Joint Venture remains in compliance with all governmental
and other procedures.
9.3 Joint Venture with Centerra Gold Inc.
KEFI Minerals previously had a joint venture with Centerra Gold Inc.
("Centerra") in the Bakir Tepe Project in Turkey. On 15 December 2010, Centerra
withdrew from the joint venture which resulted in. an income of GBP 66,733
being recognised in the 2011 accounts.
10. Trade and other payables
30 June 30 June 31 Dec
2012 2011 2011
GBP'000 GBP'000 GBP'000
Trade payables 16 97 126
Accruals 31 6 4
Payable to shareholders 59 63 121
106 166 251
KEFI MINERALS PLC
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2012
11. Related party transactions
The following transactions were carried out with related parties:
a. Purchases of services
The Company has an ongoing service agreement with EMED Mining Public Limited
for provision of management and other professional services.
Six Six Twelve
months
months months ended 31
ended 30 ended Dec 2011
June 2012
30 June
2011
GBP'000 GBP'000 GBP'000
Transactions with EMED Mining Public 59 57 115
Limited
b. Compensation of key management personnel
The total remuneration of the Directors and other key management personnel was
as follows:
Six Six Twelve
months months months
ended ended ended
30 June 30 June 31 Dec
2012 2011 2011
GBP'000 GBP'000 GBP'000
Directors' fees 113 102 196
Key management personnel fees 117 54 57
Share-based benefits to key management - 19 -
personnel
230 175 253
Share-based benefits
No options have been issued or exercised during the period by directors from
grant date to 30 June 2012.
c. Year end balances arising from purchases of services
Payable to related party: Six Six Twelve
months months months
ended ended ended
30 June 30 June 31 Dec
2012 2011 2011
GBP'000 GBP'000 GBP'000
EMED Mining Public Limited 59 63 121
12. Contingent liabilities
In 2006, EMED Mining Public Ltd acquired a proprietary geological database that
covers extensive parts of Turkey and Greece and also EMED transferred to the
Company that part of the geological database that relates to areas in Turkey.
Under the agreement, the Company has undertaken to make a payment of
approximately GBP59,700 (AUD105,000) for each tenement it is subsequently
awarded in Turkey and which was identified from the database. The maximum
number of such payments required under the agreement is four, resulting in a
contingent liability of up to GBP238,800. These payments are to be settled by
issuing shares in the Company. To date, only one tranche of shares have been
issued under this agreement in June 2007 for GBP43,750 (AUD105,000).
KEFI MINERALS PLC
NOTES TO THE CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 JUNE 2012
13. Relationship deed
A Relationship Deed between EMED and the Company dated 7 November 2006, by
which EMED agrees not to operate in Bulgaria and Turkey, and the Company agrees
not to operate in Albania, Armenia, Azerbaijan, Cyprus, Greece, Hungary, Iran,
Oman, Romania, Saudi Arabia, Serbia or Slovakia the "EMED Area".
The Relationship Deed provides that EMED has the right to appoint one
non-executive director of the Company. It also provides EMED with a right of
first refusal in respect of funding any proposed mining or exploration project
of the Company. The Relationship Deed provides that the Company shall refer any
opportunity to conduct mining or exploration activity in the EMED Area to EMED,
and EMED shall refer any such opportunity in Bulgaria or Turkey to the Company.
EMED has since granted the Company the right to explore in Saudi Arabia in
return for which it will receive, to the extent possible under legislation in
Saudi Arabia, first right of refusal over participation in any projects
developed (or not taken up) by the joint venture established on 28 May 2009 in
that country with Abdul Rahman Saad Al-Rashid & Sons Company Limited.
14. Capital commitments
The Group has no capital or other commitments as at 30 June 2012.
15. Events after the reporting period
On 6 August 2012, the Company allotted 42,000,000 new ordinary shares at 2.3
pence per share to three individual principals of ARTAR, KEFI's 60% partner in
the Company's Gold & Minerals Joint Venture in the amount of 14,000,000 shares
each. The issue price was 2.3 pence each raising an aggregated amount of £
966,000.
REVIEW REPORT TO KEFI MINERALS PLC
We have reviewed the accompanying statement of financial position of KEFI
Minerals Plc at June 30, 2012, and the statement of comprehensive income,
statement of changes in equity and statement of cash flows for the period then
ended. These financial statements are the responsibility of the Company's
management. Our responsibility is to issue a report on these financial
statements based on our review.
We conducted our review in accordance with the International Standard on Review
Engagements 2400. This Standard requires that we plan and perform the review to
obtain moderate assurance as to whether the financial statements are free of
material misstatement. A review is limited primarily to inquiries of company
personnel and analytical procedures applied to financial data and thus provide
less assurance than an audit. We have not performed an audit and, accordingly,
we do not express an audit opinion.
Based on our review, nothing has come to our attention that causes us to
believe that the accompanying financial statements do not give a true and fair
view in accordance with International Accounting Standards.
Nicosia, Cyprus, 10 September 2012 MOORE STEPHENS STYLIANOU & CO
CERTIFIED PUBLIC ACCOUNTANTS - CY
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