Final Results

RNS Number : 1655R

Bezant Resources PLC

15 November 2012

 



15 November 2012

Bezant Resources Plc

("Bezant" or the "Company")

Final Results for the Year Ended 30 June 2012

Bezant (AIM: BZT), the AIM listed gold and copper exploration and development company operating in the Philippines and Argentina, announces its audited final results for the year ended 30 June 2012.

Highlights:

Mankayan Copper-Gold Project, Philippines:

·     The Mankayan Project remains the subject of an option granted to Gold Fields Netherlands Services BV ("Gold Fields"). We continue to maintain a regular dialogue with Gold Fields and await a decision with respect to the potential exercise of its option prior to its expiry date of 31 January 2013.

Eureka Copper-Gold Project, Argentina:

·     Acquisition of 100% of Puna Metals S.A. ("Puna") completed, with a saving of US$1.3m in return for a final accelerated lump sum cash payment. Puna holds a package of 11 prospective copper and gold exploration licences in the province of Jujuy, north-west Argentina (the "Eureka Project").

·     Environmental base line study completed and formal submission of statutory Environmental Impact Assessment ("EIA") and hydrogeological reports made to the provincial authorities.

·     Copper-gold mineralised strata and lenses identified further to the completion of a Vertical Electrical Sounding survey programme.

Mkurumu Project:

·     Joint Venture Agreement with Ashanti Exploration (Tanzania) Limited, in respect of the Company's fully impaired Mkurumu Project, terminated. New agreement negotiated, whereby the Company retains a reduced free carried interest of 5 per cent., along with a Net Smelter Return Royalty of 2 per cent., with no exposure to any further exploration costs on the project.

Corporate:

·     Appointment of Dr Bernard Olivier as Chief Executive Officer, having previously served as the Company's Executive Technical Director since 2007.

·     Loss after tax for the twelve month period of £1.84 million (2011: loss of £1.55 million).

·     Approximately £4.3 million cash held at the period end.

Post Period End:

·     Appointment of Mr Lawrence Read as a Non-executive Director of the Company.

Gerry Nealon, Executive Chairman of Bezant, commented:

"We are encouraged by Gold Fields' significant investment of US$220m to acquire 40% of the adjacent Far Southeast Project in the Philippines announced earlier this year, with an outstanding option over a further 20% interest. We look forward to receiving a decision from Gold Fields in respect of its option over our Mankayan Project prior to its scheduled expiry on 31 January 2013.

We were delighted to achieve a significant saving on the accelerated acquisition of 100% of our Eureka Project in Argentina and are hopeful of receiving a swift positive decision to the requisite approvals sought from the provincial authorities and other stakeholders to enable further progress to be made on this exciting project in the year ahead."

For further information, please contact:

Gerry Nealon Executive Chairman, Bezant Resources Plc                              Bernard Olivier Chief Executive Officer, Bezant Resources Plc                              James Harris / Matthew Chandler / David Altberg Strand Hanson Limited                                                           James Maxwell / Jenny Wyllie N+1 Singer                                                or visit http://www.bezantresources.com

Tel: [phone] Tel: [phone] Tel: [phone] Tel: [phone]

Chairman's statement

I am pleased to again report to our shareholders upon the further progress made by the Company during its financial year ended 30 June 2012 and on our subsequent ongoing activities to the date of this statement.

Mankayan Project:

As previously announced, at a duly convened General Meeting held on 26 October 2011, shareholders approved the grant of an option (the "Option") to Gold Fields Netherlands Services BV ("Gold Fields") pursuant to the terms of an option agreement (the "Option Agreement") entered into by the Company for the potential disposal of its subsidiary, Asean Copper Investments Limited ("Asean"). Under the terms of the Option Agreement, Gold Fields paid a non-refundable upfront cash payment of US$7 million, with a further cash sum of US$63 million becoming payable should the Option be exercised prior to its scheduled expiry date on 31 January 2013. 

To date, the Company has not received any formal notice from Gold Fields in respect of its intentions with regards to potentially exercising the Option prior to its expiry. The Company continues to maintain regular dialogue with Gold Fields' representatives and we shall release an appropriate announcement without delay following receipt of a formal decision from Gold Fields.

During the period under review, Gold Fields has released positive resource and reserve estimates in respect of its ongoing exploration activities at the "Far Southeast Project", being its flagship deposit in the Philippines situated approximately six kilometres from our Mankayan project area. Gold Fields has to date committed considerable capital outlay on community liaison and exploration activities and invested a significant cash sum further to the acquisition of a 40 per cent. stake in the Far Southeast Project for US$220 million from Liberty Express Assets with an option outstanding over a further 20 per cent. interest for a further US$120 million from Lepanto Consolidated Mining Company.

With respect to the current status of the Far Southeast Project, we understand that Gold Fields is still awaiting the free, prior and informed consent ("FPIC") from the relevant indigenous communities to support its application for the grant of a Financial or Technical Assistance Agreement (the "FTAA Licence") from the relevant Philippine authorities. The granting of an FTAA Licence permits 100 per cent. equity ownership of an asset in the Philippines by a foreign entity and accordingly is a key step to progressing large scale mining projects, such as Far Southeast and Mankayan.

In the event that the Option over the Mankayan Project is exercised, it remains the Board's intention to distribute a significant proportion of the sale proceeds to shareholders, as set out in my statement in last year's annual report.

Eureka Project:

Following receipt of the abovementioned non-refundable upfront Option payment from Gold Fields, the Company was in a strong position to negotiate an accelerated acquisition of 100 per cent. of the Eureka Project in Argentina. As a result, the Company achieved a saving of US$1.3 million on the originally agreed staggered acquisition terms in return for a final accelerated lump sum cash payment for the Eureka Project, a near surface copper-gold project, historically mined and located near to the Argentine border with Bolivia.  Accordingly, the Company is now the sole owner and operator and has total discretion over all exploration expenditure on the project, which currently has unaudited unclassified resource estimates, based on third parties' historic exploration activities, in the order of, in aggregate, up to approximately 62 million tonnes grading at approximately 1 per cent. copper with approximately 52,000 ounces of gold as credits.

On 15 August 2011, the Company announced that it had completed Phase I of its initial exploration programme in relation to the evaluation of historical data and the generation of a geographic information system ("GIS") database. This included the identification of encouraging geophysical responses with zones of high electrical chargeability and resistivity from interpretation of a three-dimensional Induced Polarisation ("IP") survey, which will provide additional targets for the Company's planned ongoing exploration programme.

On 18 April 2012, the Company announced the completion of an environmental base line study, along with the formal submission of our statutory Environmental Impact Assessment ("EIA") and Hydrogeological Reports to the provincial authorities. Our consultation programme with the provincial authorities and local indigenous communities has been positive, and we are currently supplying further expert testimony on the potential impact of the project's redevelopment to the Judge of Mines. Our EIA is also being presented to the presidents, associated office bearers and community representatives of the affected indigenous peoples and we are hopeful of receiving a formal decision in due course. Although the consultation process is lengthy, upon completion and a positive outcome, a full mining licence(s) should be granted enabling development of this near surface copper-gold project.

Encouraging results were also obtained from surface rock samples gathered in connection with the EIA study, with the average copper value for all of the surface rock samples sent for analysis equating to 1.7% Cu.

On 8 October 2012, the Company announced that copper-gold mineralised strata and lenses had been identified further to completion of a Vertical Electrical Sounding ("VES") survey programme. The survey indicated an increase in the thickness of copper mineralisation in the project area thereby facilitating the development of a further exploration methodology for future exploration programmes.

Mkurumu Project:

All exploration activities in Tanzania were discontinued in prior years and the original exploration costs fully impaired. On 27 March 2012, the Company announced that its wholly-owned subsidiary, Anglo Tanzania Gold Limited ("ATGL"), had agreed to the termination of its existing Joint Venture Agreement (the "Existing Agreement") with Ashanti Exploration (Tanzania) Limited ("AETL") in respect of the "Mkurumu project", situated in the Kilindi District, Tanga Region, Tanzania.

Along with the termination of the Existing Agreement, the Company successfully negotiated a new agreement with AETL whereby ATGL now holds a reduced free carried interest of 5 per cent., along with a Net Smelter Return Royalty of 2 per cent. of any potential future Net Smelter Return due to AETL. As a result of the termination of the Existing Agreement, ATGL no longer has any exposure to any further exploration expenditure on the project.

Financial / other:

For the financial year ended 30 June 2012, the Company made a loss after tax of £1,836,000 (2011: loss of £1,550,000). This loss reflects the expenditure on our ongoing exploration activities and the cost of the full acquisition of the Eureka Project in Argentina. It does not reflect the £3,610,000 non-refundable option payment received from Gold Fields (net of costs associated with the negotiation and finalisation of the Option Agreement) since the appropriate accounting treatment is to capitalise this amount as a deposit/deferred income on the balance sheet until such time as the option is exercised or lapses when it will then be recognised in the income statement.

On 30 January 2012, the Company was pleased to announce the appointment of Dr. Bernard Olivier as Chief Executive Officer, having previously served the Company since April 2007 as Executive Technical Director.

Subsequent to the period end on 15 October 2012, the Company was also pleased to announce the appointment of Mr. Laurence Read as a Non-executive Director of the Company. Mr. Read hasconsiderable experience advising natural resources companies and brings invaluable knowledge and expertise to assist with the Group's future growth.

I would like to take this opportunity to once again thank all of our employees, advisers, shareholders and other stakeholders for their continuing patience, interest and support with the Company's further development.

Gerard Nealon

Executive Chairman

15 November 2012

Group Statement of Comprehensive Income

For the year ended 30 June 2012

				2012		2011
	Notes			£'000		£'000
Continuing operations
Group revenue				-		-
Cost of sales				-		-
Gross profit/(loss)				-		-
Administrative expenses				(1,652)		(1,555)
Impairment expenses				-		-
Group operating loss				(1,652)		(1,555)
Interest receivable				9		5
Other income				-		-
Total income				9		5
Share of Associates' loss				(193)		-
Loss before taxation				(1,836)		(1,550)
Taxation				-		-
Loss for the year				(1,836)		(1,550)
Attributable to: Equity holders of the Company				(1,836)		(1,550)
Other comprehensive income:
Foreign currency reserve movement				143		58
Total comprehensive expense for the year attributable to equity holders of the Company				(1,693)		(1,492)
Loss per share (pence)
Basic & Diluted	2			(2.82p)		(2.88p)

Consolidated Statement of Changes in Equity

For the year ended 30 June 2012

 

	Share Capital £'000	Share Premium £'000	Other Reserves £'000	Accumulated Losses £'000	Total Equity £'000
Balance at 1 July 2011	1,067	30,691	390	(17,430)	14,718
Current year loss	-	-	-	(1,836)	(1,836)
Foreign currency reserve	-	-	143	-	143
Total comprehensive expenses for the year	-	-	143	(1,836)	(1,693)
Share issues	-	-	-	-	-
Share issue costs	-	-	-	-	-
Cost of share-based payments	-	-	-	-	-
Balance at 30 June 2012	1,067	30,691	533	(19,266)	13,025

	Share Capital £'000	Share Premium £'000	Other Reserves £'000	Accumulated Losses £'000	Total Equity £'000
Balance at 1 July 2010	1,032	23,810	332	(15,880)	9,294
Current year loss	-	-	-	(1,550)	(1,550)
Foreign currency reserve	-	-	58	-	58
Total comprehensive expenses for the year	-	-	58	(1,550)	(1,492)
Share issues	35	7,118	-	-	7,153
Share issue costs	-	(237)	-	-	(237)
Cost of share-based payments	-	-	-	-	-
Balance at 30 June 2011	1,067	30,691	390	(17,430)	14,718

Consolidated Balance Sheet

As at 30 June 2012

			2012	2011
	Notes		£'000	£'000
ASSETS
Non-current assets
Intangible assets - goodwill			-	-
Plant and equipment			43	23
Investment in subsidiary			-	-
Investments			7,679	7,783
Deferred exploration and evaluation costs			4,784	2,532
Total non-current assets			12,506	10,338
Current assets
Trade and other receivables			25	16
Cash at bank and in hand			4,287	4,418
Total current assets			4,312	4,434
TOTAL ASSETS			16,818	14,772
LIABILITIES
Current liabilities
Trade and other payables			3,793	54
Total current liabilities			3,793	54
NET ASSETS			13,025	14,718
EQUITY
Share capital	3		1,067	1,067
Share premium account	3		30,691	30,691
Share based payment reserve	4		265	265
Other reserves	4		268	125
Accumulated losses	4		(19,266)	(17,430)
SHAREHOLDERS' EQUITY			13,025	14,718

Consolidated Cash Flow Statement

For the year ended 30 June 2012

			2012	2011
	Notes		£'000	£'000
Net cash outflow from operating activities	6		(1,653)	(1,649)
Cash flows from investing activities
Interest received			9	5
Other income			60	39
Proceeds from sale of investments			-	-
Payments for plant and equipment			(6)	(5)
Payments to fund exploration			(598)	(128)
Payments to acquire subsidiary			(1,344)	-
Payments to acquire associates			-	(314)
Loans to associates and subsidiaries			(353)	(144)
Deposit for grant of option			3,610	-
Net cash outflow from investing activities			1,378	(547)
Cash flows from financing activities
Cash proceeds from issue of shares			-	4,749
Share issue costs			-	(237)
			-	4,512
Increase/(Decrease) in cash			(275)	2,316
Cash and cash equivalents at beginning of year			4,418	1,938
Foreign exchange movement			144	164
Cash and cash equivalents at end of year			4,287	4,418

Notes to the financial statements

For the year ended 30 June 2012

1.	Basis of Preparation The audited financial information set out above, which incorporates the financial information of the Company and its subsidiary undertakings (the "Group"), has been prepared using the historical cost convention and in accordance with International Financial Reporting Standards ("IFRS") including IFRS 6 'Exploration for and Evaluation of Mineral Resources', as adopted by the European Union ("EU") and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS.    The audited financial information contained in this announcement does not constitute the Company's full financial statements for the year ended 30 June 2012 or 2011, but is derived from those financial statements, approved by the board of directors. The auditors' report on the 2012 accounts was unqualified and did not contain any statement under section 498(2) or (3) of the Companies Act 2006.  The full audited financial statements for the year ended 30 June 2012 will be delivered to the Registrar of Companies and filed at Companies House following the Company's forthcoming annual general meeting.
2.		Loss per share
		The basic and diluted loss per share have been calculated using the loss for the 12 months ended 30 June 2012 of £1,836,000 (2011: £1,550,000). The basic loss per share was calculated using a weighted average number of shares in issue of 64,993,603 (2011: 53,805,262). The diluted loss per share has been calculated using an additional weighted average number of shares in issue and to be issued of 67,689,734 (2011: 56,003,062). The diluted loss per share and the basic loss per share are recorded as the same amount, as the conversion of share options decreases the basic loss per share, thus being anti-dilutive.

3.	Share capital
	Number	Class	Nominal value	Year ended 30 June 2012	Year ended 30 June 2011
				£'000	£'000
	Authorised
	690,432,500	Ordinary	0.2p	1,381	1,381
	7,959,196	Deferred	4p	319	319
	625,389	Deferred	99p	619	619
				2,319	2,319
	Allotted, called up and fully paid
	64,993,603	Ordinary	0.2p	129	129
	7,959,196	Deferred	4p	319	319
	625,389	Deferred	99p	619	619
				1,067	1,067
					Number of shares
	The movement in the share capital is summarised below:
	As at 1 July 2011				64,993,603
	As at 30 June 2012				64,993,603

			2012
			£'000
	The share premiums arising as a result of the above share transactions were as follows:
	As at 1 July 2011		30,691
	Less: share issue costs		-
	As at 30 June 2012		30,691

4.	Statement of movement on reserves
		Share-based payment reserve	Foreign exchange reserve	Revaluation reserve	Accumulated losses
		£'000	£'000	£'000	£'000
	At 1 July 2011	265	125	-	(17,430)
	Cost of share-based payments	-	-	-	-
	Current year loss	-	-	-	(1,836)
	Currency translation differences on foreign operations	-	143	-	-
	At 30 June 2012	265	268	-	(19,266)

5.	Reconciliation of movements in shareholders' funds
		2012	2011
		£'000	£'000
	Loss for the year	(1,836)	(1,550)
	Shares issued less costs	-	6,916
	Currency translation differences on  foreign currency operations	143	58
	Cost of share-based payments	-	-
	Opening shareholders' funds	14,718	9,294
	Closing shareholders' funds	13,025	14,718

6.	Reconciliation of operating loss to net cash outflow from operating activities
		2012	2011
		£'000	£'000
	Group operating loss	(1,652)	(1,550)
	Depreciation and amortisation	8	10
	Share-based payment charge	-	-
	VAT refunds received	(60)	(39)
	Foreign Exchange loss/(gain)	(56)	-
	Subsidiary loss prior period	(2)	-
	Decrease/(increase) in debtors	(9)	-
	Increase/(decrease) in creditors	118	(65)
	Net cash outflow from operating activities	(1,653)	(1,649)
7.	Availability of Annual Report and Financial Statements Copies of the Company's full Annual Report and Financial Statements are expected to be posted today to those shareholders who have elected to receive hardcopy shareholder communications from the Company and, once posted, will also be made available to download from the Company's website at www.bezantresources.com. The Annual Report and Financial Statements will also be made available for inspection at the Company's registered office during normal business hours on any weekday. Bezant Resources Plc is registered in England and Wales with registered number 02918391. The registered office is at Level 6, Quadrant House, 4 Thomas More Square, London E1W 1YW.
8.	Annual General Meeting The Company's next Annual General Meeting ("AGM") will be held on 7 December 2012 and a formal Notice of AGM and proxy form have today been posted to those shareholders who have elected to receive hard copy shareholder communications from the Company and can also be downloaded from the Company's website at www.bezantresources.com.

 

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