Final Results

RNS Number : 8919X

Goldstone Resources Ltd

24 August 2009

 

GOLDSTONE RESOURCES LIMITED

('GoldStone' or 'the Company')

Final Results for the Year Ended 28 February 2009

Chief Executive's Report

I set out below a review of the Company's activities during the year ended 28 February 2009 which includes an update on the current status of the Company's projects.

BAUXITE

GoldStone has, after a thorough review of all the exploration information at its disposal and in consideration of the potential interest shown in the Company's Bauxite project, exercised its right to apply for eleven prospecting licences within the area of the reconnaissance permission. 

The Guyana Geology and Mines Commission ('GGMC') has informed the Company that it has approved the granting of eight of the prospecting licences applied for, all of which are situated in the prospective Kopinang district. The GGMC requires that the Company make arrangements to pay the yearly rental fee of approximately US$9,800 and to post Work Performance Bonds to the amount of US$66,000 before the licences are executed. The current economic climate, the Company's cash resources and the potential outcome of discussions with a major participant in the bauxite industry will be considered by the Company before a decision is made to pursue the rights and duties applicable to the prospecting licences. 

DR3-EAST URANIUM PROJECT AND LISTING

In June 2008 GoldStone conditionally agreed to acquire up to a 100 per cent. interest in the DR3-East Uranium Project owned by Hymrai Properties 1 (Pty) Ltd ('Hymrai') (the 'Acquisition Agreement'). Completion of the transaction with Hymrai was dependent upon (i) the receipt of approval by the South African Department of Minerals and Energy ('DME'), and (ii) the listing of GoldStone on AltX, the alternative exchange operated by the Johannesburg Stock Exchange ('JSE'). The transaction was approved by the DME in April 2009, which was much later than had been expected by the Company.

The listing of GoldStone on the AltX was to occur within a certain time limit set by the advisory committee of the JSE and was also subject to the JSE's Listing Requirements. As a consequence of the late receipt of DME approval and in order to complete the listing process, GoldStone was required to make additional representations to the advisory committee of the JSE and to include further audited financial results. This would have caused further delay to the listing under circumstances where there was no certainty that the AltX would grant GoldStone the requisite approvals. As a result, the Board concluded that the uncertainty and delay caused by a further listing process would severely hamper the Company's ability to acquire or be granted potential projects and therefore decided to no longer seek the listing on the AltX.  

As result of the Board's decision not to continue with the listing process, the conditions of the Acquisition Agreement could not be met and therefore the Acquisition Agreement lapsed.

Any future acquisition of an interest in the DR3-East Uranium Project by the Company could only become effective if the transaction complies with the requirements of the South African Reserve Bank ('SARB') as applicable to GoldStone. The requirements specify that GoldStone may only make an investment in the Southern African Development Community, such as in the DR3-East Uranium Project, if GeoQuest Holdings Ltd ('GeoQuest'), a major shareholder in GoldStone and a South African company, has divested of its interest in the Company or if GoldStone lists on a South African stock exchange. The Company therefore intends to explore with GeoQuest the potential for it to divest of its interest in Goldstone with a view to pursuing the acquisition of an interest in DR3 East Uranium Project. 

GOLD

The Company has been assessing and reviewing palaeoplacer and hydrothermal gold prospects worldwide.

Mali

In June 2008 the Company was granted two (Baroya and Metedia) short term gold exploration permits in Mali, West Africa ('the Permits'). The Permits granted the Company exclusive exploration rights for a period of three months in order to evaluate the potential of the Permits and the exclusive right to apply for long term prospecting licences over the Permits once evaluative exploration has been conducted. GoldStone conducted exploration over the Permits and elected to exercise its exclusive right to apply for a prospecting licence over the Permits at the end of the three months exploration period by applying to the Malian Department of Mines and Geology ('DNGM') during August 2008. In addition and at the same time, the Company applied to the DNGM for a prospecting licence over the Yatia permit area which is an area adjacent to the Permits.  

The Baroya, Metedia and Yatia permit areas ('the Permit Areas') are adjacent to one another, together occupying a total area of 15 km2 and are close to the international border with Senegal in the south-western gold belt of Mali. The Permit Areas are within eight kilometres of the Tabakoto/Segala gold mine, which was recently re-commissioned by Avion Resources.  

The Permit Areas have previously been explored by various Malian and international companies. The most recent report available from the DNGM for the Permit Areas was conducted in 2003 and indicated that exploration was discontinued on the Permit Areas during 2003 when the gold price was approximately US$350 per ounce and also before the Tabakoto gold mine entered into production.

Senegal

In May 2008, GoldStone lodged applications for three gold exploration permits in Senegal, West Africa. In order to expedite the granting of the most prospective permit area and after discussion with the Company's geological consultants, the Company decided to only pursue the Sangola (471 km2) licence. This licence area contains potential hydrothermal gold mineralization. The Directors believe that this area has not been explored using modern techniques and accordingly may hold the potential for new gold discoveries. The Company expects this permit area to be granted shortly.

India

In June 2008, GoldStone applied for a licence to explore an identified sedimentary basin in one of the states of India where the Company hopes to find a Witwatersrand type palaeoplacer gold deposit. The Company's application is currently under consideration by the Indian authorities.

FINANCING

The Company's cash resources are currently approximately US$1.0 million. 

BOARD

Dr. Lawrie Minter, Director of Geology of GoldStone, resigned from the Board of Directors of the Company on 28 February 2009 for personal reasons.  

On 20 May 2009 Sir Michael Oliver, who was the Chairman of GoldStone, retired. 

The Company would like to thank both Dr Minter and Sir Michael for their contribution to GoldStone and wish them every success in the future. 

With effect from the same date Mr. Nico van der Hoven, who had been Chief Executive since the Company's admission to AIM in March 2004, was appointed as non-executive Chairman of GoldStone and Mr. Jurie Wessels, who had acted as the Company's Financial Director, was appointed Chief Executive Officer.  

Dr Hendrik Schloemann remains as Director of Exploration and Business Development. 

In order to save costs it was decided that no further appointments are to be made to the Board at this time and that Mr. Wessels will continue to fulfil the duties of Financial Director and Company Secretary.  

OUTLOOK

In addition to the Company's potential prospects in West Africa and India, the executive directors of GoldStone are currently assessing the filing of applications in Gabon and are pursuing opportunities, all of which are in varying stages of development, in various African countries including Ghana, Kenya, South Africa and Tanzania.  

APPROVAL

Dr. Hendrik Schloemann, who holds a PhD in geochemistry, has reviewed and approved the content of this announcement.

Jurie Wessels

Chief Executive Officer

20 August 2009

GoldStone Resources Ltd	[phone]
Jurie Wessels (Chief Executive Officer)
Hanson Westhouse Limited	[phone]
Tim Feather / Matthew Johnson

STATEMENT OF OPERATIONS

For the year ended 28 February 2009

	Note			Year ended 2009 $	Year ended 2008 $
Revenues
Management fees				-	47,500
Interest receivable				42,983	136,161
				42,983	183,661
Exploration expenses
Exploration expenses				(145,189)	(105,793)
Gross (loss)/profit				(102,206)	77,868
Other operating expenses				(1,008,444)	(847,189)
OPERATING LOSS FOR THE FINANCIAL YEAR				(1,110,650)	(769,321)
LOSS FOR THE FINANCIAL YEAR				(1,110,650)	(769,321)
Loss per ordinary share
Basic and diluted loss per share (cents per share)	2			(0.8)	(0.6)

 

 

BALANCE SHEET 28 February 2009
				Year ended 2009 $	Year ended 2008 $
FIXED ASSETS
Tangible assets				12,026	21,016
CURRENT ASSETS
Receivables and prepayments				19,195	19,195
Cash at bank				1,233,834	2,336,447
				1,253,029	2,355,642
CREDITORS: amounts falling due within one year
Creditors and accruals				41,566	42,519
Net current assets				1,211,463	2,313,123
TOTAL ASSETS LESS CURRENT LIABILITIES				1,223,489	2,334,139
CAPITAL AND RESERVES
Share capital				2,354,482	2,354,482
Share premium				13,849,554	13,849,554
Capital contribution reserve				555,110	555,110
Profit and loss account - (deficit)				(15,535,657)	(14,425,007)
SHAREHOLDERS' FUNDS				1,223,489	2,334,139

STATEMENT OF CHANGES IN EQUITY 28 February 2009
				Year ended 2009 $	Year ended 2008 $
SHARE CAPITAL - £0.01 per value
Authorised - 250,000,000 shares
Issure and fully 130,816,663 shares				2,354,482	2,354,482
SHARE PREMIUM				13,849,554	13,849,554
CAPITAL CONTRIBUTION RESERVE				555,110	555,110
ACCUMULATED DEFICIT
Balance at beginning of year				(14,425,007)	(13,655,686)
Net loss				(1,110,650)	(769,321)
Balance at end of year				(15,535,657)	(14,425,007)
				1,223,489	2,334,139

CASH FLOW STATEMENT 28 February 2009
				Year ended 2009 $	Year ended 2008 $
Loss for the financial year				(1,110,650)	(769,321)
Adjusted for:
Depreciation				16,018	13,299
Interest received				(42,983)	(136,161)
Decrease in debtors				-	29,345
Decrease in creditors				(953)	(36,159)
Net cash outflow from operating activities				(1,138,568)	(898,997)
Returns on investment and servicing of finance
Interest received				42,983	136,161
Purchase of fixed assets				(7,028)	(3,826)
Decrease in cash				(1,102,613)	(766,662)
Cash at beginning of the year				2,336,447	3,103,109
Cash at end of the year				1,233,834	2,336,447

NOTES

1.    EXTRACT FROM THE FINANCIAL STATEMENTS AND AUDITORS' REPORT 

The following note is extracted from note 1 to the financial statements:

'Note 1 Accounting Policies 

Going concern

The directors continue to pursue projects that have the potential to enhance shareholder value with minimum expenditure and that could possibly generate income in future periods. Based on the expected minimum exploration expenditure on projects, reduced operating costs and after making reasonable enquiries, and considering the uncertainties as described below, the directors have a reasonable expectation that the company has adequate resources to continue in operational existence for the next 12 months from the date of signing the financial statements. However, whilst the directors have measures in place to preserve cash resources and minimise the cash burn rate through cost reduction, the current economic climate, unexpected minimum exploration expenditure obligations and the company's ability to procure funding for meaningful future exploration activities when required create material uncertainties over future results and cash flows, as well as investment objectives. The company thus may not be able to realise its exploration objectives and discharge its liabilities in the normal course of business. For these reasons, the company will adopt the going concern basis in preparing the financial statements.'

The following note is extracted from the unqualified auditors' report:

'Emphasis of matter - Going concern

In forming our opinion on the financial statements, which is not qualified, we have considered the adequacy of the disclosure made in note 1 to the financial statements concerning the company's ability to continue as a going concern.  The company incurred a net loss of £1,110,650 during the year ended 28 February 2009 and the company's management are intending to minimise non-exploration operating expenses, fund minimum exploration operations in order to preserve available cash and reduce the monthly cash burn rate. In addition the company may have to consider additional funding measures in the near future in order to conduct meaningful exploration activities. As the company is dependent on implementing this strategy there is a material uncertainty which may cast significant doubt about the company's ability to continue as a going concern.  The financial statements do not include the adjustments that would result if the company was unable to continue as a going concern.'

2.    EARNINGS PER SHARE

    Basic earnings per share is calculated by dividing the losses attributable to ordinary shareholders by the weighted average number of ordinary shares in issue after the placing on AIM. Diluted earnings per share is calculated using the weighted average number of ordinary shares in issue as adjusted to assume conversion of all dilutive potential ordinary shares.

				2009 $	2008 $
Loss per ordinary share
Loss attributable to share holders				(1,110,650)	(769,321)
Weighted average number of ordinary shares				130,816,633	130,816,633
Basic and diluted loss per share				(0.8)	(0.6)

3.    ANNUAL REPORT

The Company anticipates that the annual report and accounts for the year ended 28 February 2009 will be posted to shareholders on 28 August 2009 and will be available from the Company's website at www.goldstoneresources.com from the date of posting.

 

END

 

 

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