Interim Results

RNS Number : 4810E

Persian Gold PLC

29 September 2008

 



29 September 2008

Persian Gold PLC

Interim Results for the Six Months Ended 30th June 2008

Persian Gold, the Irish explorer, continues as one of the only, if not the only, Western mining exploration companies active in Iran. The potential in Iran is vast. The country is big, over 2,000km long and underexplored, with little done in the past 30 years. 

The principal geological attraction in Iran is the Tethyan Belt stretching in an arc from Turkey through Iran into Pakistan. Modern geological modelling indicates that this belt has potential for gold, base metals and copper/gold porphyry orebodies. A number of large gold mines have been recently brought on stream in neighbouring Turkey while the largest copper/gold porphyry deposit in the world, Reko Diq, on the Iran/Pakistan border is being developed by Antofagasta and Barrick Gold. Yet, little is happening in Iran.

Persian Gold entered Iran in 2004 following a specific gold in silica-alunite exploration model. Iran has the second largest deposits of alunite in the world. Elsewhere in recent years, a number of world class gold mines processing silica-alunite have opened in the Andes. We are looking to replicate this success. We continue to hold licences in the Takestan area of Iran, where the focus is gold in silica-alunite. But once we were established in the country, other projects were offered. We are currently focused on two gold projects, Chah-e-Zard and Dalli, but we have a number of others under evaluation.

Dalli

The current focus of activity is at Dalli, located some 200km southwest of Tehran, where a second stage drilling programme has been finalised. In total 8 holes have been drilled to a total depth of 2,494m, as well as 16 trenches covering 1,513m from which 2,030 samples were collected and sent for analysis.

We now believe there to be two orebodies at Dalli, the North and South Hills, separated by 1.7km. The indications are that the North Hill is predominantly a gold deposit while the South is a copper/gold porphyry. The first phase drilling on the North Hill produced marginally economic grades so it was decided to focus on the South Hill where the second stage drilling took place. Results are not yet available but visual inspection of the drill core combined with the assay results of the earlier drilling suggests that the grades of copper and gold could be quite variable within the mineralised orebody. The style and grade of mineralisation at South Hill is significant and warrants a regional search of the surrounding area to identify similar systems. This study will use Aster interpretation, rock sampling, soil geochemistry and surface IP geophysical survey.

Chah-e-Zard

The Chah-e-Zard prospect is located 550km southeast of Tehran. Results from phase 1 trenching and drilling led to a second phase of shallow drilling focused on the Southern lobe of the sampled area. To date, 38 holes, totalling 4,150m have been drilled and 38 trenches totalling 3,545m dug. Almost 3,000 drill core samples and 1,409 trench samples were analysed. All of the surface and drill hole data was put into a three dimensional model covering the Southern lobe to determine the near surface resources of gold and silver. The model indicates 160,000 ounces of gold and 1 million ounces of silver. It must be emphasised that this estimate is only near surface Southern lobe. An early stage scoping study suggests that an open cast heap leach operation may be economic. With our local 30 per cent partner, we have applied for, and await, a Discovery Certificate before initiating a pre-feasibility study.

It is important to note that the project outlined above relates to a small portion of the 750m by 1.25km mineralised zone previously identified by extensive soil sampling. The potential at depth over the entire area remains open.

Other Projects

Several new projects, almost all gold/copper were presented to Persian Gold. We are limited by finance and people on the number of projects we can handle at any one time. Large potential projects such as Shadan in eastern Iran were deemed too big for Persian Gold. Currently, projects in Zonouz, Ghahan, Angoran-Chay and Khoineroud are under review.

Approaches have been made to Persian Gold to examine exploration projects in areas adjacent to Iran, such as Azerbaijan and Kazakhstan.

Future

The continuous diatribe against Iran from the West has an adverse effect. Threats of war frighten investors. They sell into a market with no buyers. In one small deal in recent months, the market capitalisation of Persian Gold was halved. The recent collapse in world stock markets bodes badly for AIM. Cash will be hard to raise, even for the best projects. However, it is uncertain times that produce great opportunities. We are alone in Iran with a choice of high class projects. We expect to move forward with at least one of our current projects as well as acquiring new ventures. We are looking at options on how to finance these activities.

John Teeling

Chairman

29 September 2008

Enquiries:

Persian Gold PLC
John Teeling, Executive Chairman	[phone]
College Hill
Paddy Blewer Nick Elwes	[phone]
Blue Oar Securities Plc
Simon Moynagh John Wakefield	[phone]

Financial Information (Unaudited) Six Months Ended Yr Ended 30 June 08 30 June 07 31 Dec 07 unaudited unaudited audited Condensed Consolidated Income Statement £'000 £'000 £'000 Revenue 0 0 0 Operating Costs (192) (162) (396) Operating Loss (192) (162) (396) Interest Receivable 4  6  17  Loss on ordinary activities before taxation (188) (156) (379) Taxation 0  0  0  Loss for the period (188) (156) (379) Loss per share (.30p) (.28p) (.66p) Condensed Consolidated Balance Sheet 30 June 08 30 June 07 31 Dec 07 unaudited unaudited audited £'000 £'000 £'000 Assets Intangible Assets 1,474 921 1,283 Current Assets Other receivables and prepayments 12 5 20 Cash and cash equivalents 278 115 693 Total Current Assets 290 120 713 Total Assets 1,764 1,041 1,996 Liabilities Current Liabilities Trade and other payables (228) (265) (272) Non-current Liabilities Provisions (10) 0 (10) Total Liabilities (238) (265) (282) Net Assets 1,526 776 1,714 Equity Share Capital and Reserves 1,526 776 1,714 Total Equity 1,526 776 1,714 Condensed Consolidated Statement of Changes in Shareholders Equity Six Months Ended 30 June 08 Share Share Other Retained Total Capital Premium Reserves Losses Equity £'000 £'000 £'000 £'000 £'000 As at 1 January 2007 140 1,246 55 (509) 932 Share option costs recognised in reserves 0 Shares issued 0 Share issue expenses 0 Loss for the period (156) (156) As at 30 June 2007 140 1,246 55 (665) 776 Share option costs recognised in reserves 75 75 Shares issued 18 1,122 1140 Share issue expenses (54) (54) Loss for the period (223) (223) As at 31 December 2007 158 2,314 130 (888) 1,714 Share option costs recognised in reserves 0 Shares issued 0 Share premium on shares issued 0 Loss for the period (188) (188) As at 30 June 2008 158 2,314 130 (1,076) 1,526 Six Months Ended Yr Ended 30 June 08 30 June 07 31 Dec 07 unaudited unaudited audited Condensed Consolidated Cash Flow £'000 £'000 £'000 Cash flows from operating activities Operating Loss  (192)  (162)  (396) Movements in Working Capital  (36) 63  115  Net Cash Outflow from Operating Activities  (228)  (99)  (281) Cash Flow from Investing Activities Returns on Investments and Servicing of Finance 4  6  17  Capital Expenditure  (191)  (101)  (439) Net Cash used in Investing Activities  (187)  (95)  (422) Financing Activities Proceeds from issue of equity shares 0  0  1,087  Net Decrease in Cash and Cash Equivalents  (415)  (194) 384  Cash and Cash Equivalents at beginning of the period 693  309  309  Cash and Cash Equivalents at end of the period 278  115  693

  Notes: 

1. Information

The financial information for the six months ended June 30th, 2008 and June 30th, 2007 is unaudited. The financial information above does not constitute full statutory accounts within the meaning of section 240 of the Companies Act 1985.

The interim financial report has been prepared in accordance with IAS 34 Interim Financial Reporting and the accounting policies and methods of computation used in the interim financial statements are consistent with those used in the Group 2007 Annual Report, which is available at www.persiangoldplc.com

The interim financial statements have not been audited or reviewed by the auditors of the Group pursuant to the Auditing Practices board guidance on Review of Interim Financial Information.

No dividend is proposed in respect of the period.

2. Loss per Share

	30 June 08	30 June 07	31 Dec 07
	£	£	£
Loss per share - Basic and Diluted	(0.30p)	(0.28p)	(0.66p)
Basic loss per share
The earnings and weighted average number of ordinary shares used in the calculation of basic loss per share are as follows:
Loss for the year attributable to equity holders of the Parent	(188,291)	(156,272)	(379,383)
Weighted average number of ordinary shares for the purpose of basic earnings per share	63,412,198	55,802,800	57,720,785

3. Intangible Assets

	30 June 08	30 June 07	31 Dec 07
Exploration and evaluation assets:	£'000	£'000	£'000
Cost at 1 January	1,283	819	819
Additions	191	102	464
	_________	_________	_________
Cost and net book value	1,474	921	1,283

Exploration and evaluation assets relates to expenditure incurred during prospecting, exploring for gold and related expenditure in Iran.

All intangible assets held by the group to date are at an early stage of exploration, but all present indications, including those from feasibility reports produced during 2007 are that it will have a value in excess of the accumulated costs to date. No impairment provision has been made in respect of these intangible assets.

The group's activities are subject to a number of significant potential risks including:

- Price fluctuations

- Uncertainties over development and operational costs

- Operational and environmental risks

- Political and legal risks, including arrangements with governments for licences, 

profit sharing and taxation

- Availability of funding developments

The realisation of this intangible asset is dependent on the successful discovery and development of economic mineral reserves which is affected by these and other risks. Should this prove unsuccessful the value included in the balance sheet would be written off to the income statement.

The directors are aware that by its nature there is an inherent uncertainty in such development expenditure as to the value of the asset. Having reviewed the deferred exploration and evaluation development expenditure at 30 June 2008, the directors are satisfied that the value of the intangible asset is not less than carrying net book value.

4. The Interim Report for the six months to June 30th, 2008 was approved by the Directors on 29 September 2008.

5. Copies of this announcement will be sent to shareholders and will be available for inspection at the Companies Registered Office at 20-22 Bedford Row, London WC1R 4JS. The Interim Report may also be viewed at Persian Gold plc's website at www.persiangoldplc.com.

 

END

 

 

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