Interim Results

RNS Number : 9824U

Sunrise Diamonds PLC

21 May 2008

 

Interim Statement 2008

Chairman's Statement

I am pleased to report the Company's progress and interim results for the six month period ended 31 March 2008.

Review of Activities

The Company's diamond exploration in Finland during the period was concentrated in the Kaavi-Kuopio region, both on our own claim areas and on the claims where we are earning a joint venture interest from Nordic Diamonds Inc. 

Our strategy in this region is based on the concept of a central diamond processing plant treating ore from a number of kimberlites, some of which, for example Kimberlites 12 (1.6 hectares) and 21 (1.3 hectares), are already known to have interesting grades from historic bulk sampling. Recent work has focused on evaluating less well sampled kimberlites - 10,17 and 14 - and on making new kimberlite discoveries. 

In February 2008 we announced the finding of macrodiamonds in drill samples from Kimberlite Pipes 10 and 17 as well as a significant number of larger sized stones and a relatively coarse stone size distribution in the sample from Pipe 17. The diamonds recovered from Pipe 17 have positive value characteristics, most being colourless and of moderate to good quality. Pipe 17, which has a surface area of approximately 2 hectares, is considered to have further commercial potential and the Company's consultant, Mineral Services, has recommended follow up and larger scale sampling.

Drill samples from Pipe 14 are still being evaluated due to the difficulties experienced in picking diamonds from the large quantity of concentrate that was initially recovered from this kimberlite.

Work is advanced at Targets 295 (Nordic JV) and 298 (100% Sunrise) near Kuopio where we are narrowing the search for the source of diamonds and diamondiferous kimberlite found in surface sediments. A recent magnetic survey at Target 298 has identified a magnetic anomaly at the head of the diamondiferous kimberlite boulder train which now needs to be drill tested. Further trenching is also planned to locate the source of microdiamonds and kimberlite fragments found on Target 295.

We have continued to leverage on our exclusive licence to use the BHP Billiton diamond exploration database fro Finland with the recent announcement of an agreement with Mantle Diamonds Limited giving Sunrise a 20% joint venture interest, free carried to a mining decision, in two kimberlite targets identified from the database on ground controlled by Mantle. These targets are located close to the Lahtojoki pipe currently being bulk sampled by Mantle as part of a full feasibility study. They are high interest electromagnetic anomalies with similar characteristics to the anomaly caused by the Lahtojoki pipe which has a drill-indicated diamond grade of approximately 35 carats per hundred tonnes. 

The Company has identified a number of similar kimberlite targets elsewhere in the region where it has secured claims and is carrying out its own follow up work. Due to the exceptionally mild winter in central Finland insufficient ice cover developed to allow us to test a number of the more exciting drill-targets that we have identified beneath one of the large lakes in the area. These are now scheduled for testing next winter.

We are continuing our generative work elsewhere in Finland and overseas and hope to be in a position to deliver further news on new projects in future.

Results

The Group has now adopted International Financial Reporting Standards and is reporting a loss for the six month period of £99,891. (£97,598 for the six months to 31 March 2007). This loss comprises administration costs of £103,825, exploration costs (written-off) amounting to £9,747 and interest income of £13,583.

Patrick Cheetham

Executive Chairman

21 May 2008

For further information contact :

Sunrise Diamonds plc	Tel: + 44 (0)1625 505947
Sunrise House	Fax: + 44 (0)1625 626204
Hulley Road
Macclesfield	Website: www.sunrisediamonds.com
Cheshire  SK10 2LP
Ruegg & Co Limited	Tel: [phone]
Nominated Adviser
Brett Miller/Roxane Marffy

  Consolidated Income Statement

for the six months to 31 March 2008

	Six months  to 31 March    2008   Unaudited		Six months  to 31 March   2007   Unaudited		Twelve months to   30 September   2007   Unaudited
	£		£		£
Exploration costs written off	9,747		7,371		43,305
Administrative expenses	103,825		97,578		191,335
Operating loss	(113,572)		(104,949)		(234,640)
Interest receivable	13,583		7,351		18,961
Loss on ordinary activities before taxation	(99,989)		(97,598)		(215,679)
Tax on loss on ordinary activities	-		-		-
Loss on ordinary activities after taxation	(99,989)		(97,598)		(215,679)
Minority Interests	98		-		3,058
Loss for the period	(99,891)		(97,598)		(212,621)
Loss per share - basic and fully diluted  (pence) (note 3)	(0.07)		(0.09)		(0.18)

Balance Sheet

as at 31 March 2008

	As at   31 March   2008   Unaudited		As at    31 March    2007   Unaudited		As at  30 September   2007   Unaudited
	£		£		£
Non-current assets
Intangible Assets	1,148,807		788,989		986,355
Current assets
Receivables	87,435		23,131		309,042
Cash at bank and in hand	316,769		664,195		455,930
	404,204		687,326		764,972
Payables : amounts falling due within one year	(96,816)		(79,529)		(206,019)
Net current assets	307,388		607,797		558,953
Net Assets	1,456,195		1,396,786		1,545,308
Equity
Called up share capital	139,222		124,905		138,867
Share premium account	1,965,580		1,707,939		1,959,723
Other reserves	36,577		81,785		82,636
Profit and loss account	(682,035)		(517,843)		(632,867)
Total Equity	1,459,344		1,396,786		1,548,359
Equity Minority Interests	3,149		-		3,051
Total Capital Employed	1,456,195		1,396,786		1,545,308

Consolidated Statement of Changes in Equity

for the six months to 31 March 2008

	Six months  to 31 March                   2008         Unaudited		Six months     to 31 March                    2007           Unaudited		Twelve months  to 30 September                 2007       Unaudited
	£		£		£
Opening Equity	1,548,359		964,372		964,372
Issue of ordinary shares	6,212		517,627		783,373
Share based payments	4,664		12,384		13,235
Profit and loss account	(99,891)		(97,597)		(212,621)
Closing Equity	1,459,344		1,396,786		1,548,359

Consolidated Cash Flow Statement

for the six months to 31 March 2008

	Six months  to 31 March   2008   Unaudited			Six months  to 31 March 2007 Unaudited		Twelve months  to 30 September   2007   Unaudited
	£			£		£
Operating Activities
Net cash outflow from operating activity (note 5)	(240,292)			(88,791)		(127,052)
Net cash outflow from operating activity	(240,292)			(88,791)		(127,052)
Investing Activities
Interest received (note 2)	13,583			7,351		18,961
Purchase of Intangible fixed assets	(162,452)			(156,183)		(353,549)
Net cash outflow from investing activity	(148,869)			(148,832)		(334,588)
Financing Activities
Issue of Share Capital (net of expenses)	250,000			517,628		533,373
Issue of shares in subsidiary to minority interests	-			-		7
Net cash inflow from financing activity	250,000			517,628		533,380
Net (decrease)/increase in cash	(139,161)			280,005		71,740

Notes to the Interim Statement

1.           Basis of preparation

The interim statement has been prepared in accordance with International Financial Reporting Standards (IFRS) for the first time. The Company has reviewed the accounting policies set out in the Company’s financial statements for the year ended 30 September 2007, which were prepared in accordance with UK Generally Accepted Accounting Practice (UK GAAP). The review concluded that those polices were in accordance with the requirements of IFRS and that no change or amendment to those policies is required for the preparation of this interim statement. The financial information set out in this statement relating to the period ended 30 September 2007 does not constitute statutory accounts for that period. Full audited accounts in respect of that financial period have been delivered to the Registrar of Companies. They did not contain a statement under Section 237(2) or (3) of the Companies Act 1985 and received an unqualified audit opinion, however there was an emphasis of matter in relation to the availability of project finance.

 

In common with many exploration companies, the Company raises finance for its exploration and appraisal activities in discrete tranches. Further funding is raised as and when required. When any of the Group’s projects move to the development stage, specific financing will be required.

 

The Directors are satisfied that the Company has adequate resources to continue to operate for the foreseeable future. For this reason they continue to adopt the “going concern” basis for preparing the accounts. The interim report has been approved by the Directors and is unaudited.

 

 

2.          Explanation of Transition to IFRS

 

The balance sheets as at 1 October 2006, 31 March 2007 and 30 September 2007, together with the income statements at 31 March 2007 and 30 September 2007, as prepared under UK GAAP, were reviewed, but no amendments are required to comply with IFRS.

 

The cash flow statement has been restructured to comply with IFRS and interest received is included as an investing activity.

 

  

3.      Loss per share

     Loss per share has been calculated on the attributable loss for the period and the weighted
average number of shares in issue during the period.

	Six months  to 31 March   2008   Unaudited   £		Six months  to 31 March   2007   Unaudited   £		Twelve months   to 30 September 2007   Unaudited   £
Loss (£)	(99,891)		(97,598)		(212,621)
Weighted average shares in issue (No.)	139,014,229		105,291,267		115,389,993
Basic and fully diluted loss per share (pence)	(0.07)		(0.09)		(0.18)

The loss attributable to ordinary shareholders and weighted average number of ordinary shares for the purpose of calculating the diluted earnings per ordinary share are identical to those used for the basic earnings per ordinary share. This is because the exercise of share warrants would have the effect of reducing the loss per ordinary share and is therefore not dilutive under the terms of IAS33.

4.         Share Capital

 

On 15 January 2008, an issue of 354,994 ordinary shares of 0.1p each was made at 1.75p to two non-executive Directors for a total consideration of £6,212, in satisfaction of Directors Fees.  

5. Reconciliation of operating loss to net cash outflow from operating activities

	Six months  to 31 March 2008  Unaudited		Six months  to 31 March 2007 Unaudited		Twelve months  to 30 September 2007 Unaudited
	£		£		£
Operating loss	(113,572)		(104,949)		(234,340)
Non-cash movement in reserves	10,876		12,384		13,235
(Increase)/Decrease in receivables	(28,393)		24,560		(11,351)
(Decrease)/increase in payables	(109,203)		(20,786)		105,704
Net cash outflow from operating activities	(240,292)		(88,791)		(127,052)

6. Interim report

Copies of this interim report will be sent to all shareholders and are available from Sunrise Diamonds plc, Sunrise House, Hulley Road, Macclesfield, Cheshire, SK10 2LP, United Kingdom. It is also available on the Company's website at www.sunrisediamonds.com

 

END

 

 

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