Half Yearly Report

RNS Number : 5776D

Tertiary Minerals PLC

18 May 2012

 



UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 MARCH 2012

Chairman's Statement

I am pleased to report on the Company's progress and unaudited interim results for the six month period ended 31 March 2012.

Review of Activities

In the first six months of this financial year your Company has continued to make progress towards its strategic objective to become a leading European producer of fluorspar (CaF₂), an essential raw material of fluorine in the chemical, steel and aluminium industries.

For decades China has been the dominant supplier of fluorspar to western markets but China's internal demand in the manufacture of downstream fluorine products has now grown to the point where it is likely to become a net importer. Western consumers of fluorspar, many of whom do not have captive source, now face structural supply shortages.

The fluorspar market continues to be tight and prices, currently over US$500/tonne, are holding up at historically high levels despite a challenging world economy. About six million tonnes of fluorspar are used annually and demand for fluorspar is growing at around 1.5% per year on the back of rising demand for fluorine chemicals in refrigerators, air conditioners, and cars, especially in the developing countries. Projected demand growth requires the equivalent of at least one new mid-size mining operation to be developed every year for the foreseeable future - yet only a handful of projects are reported to be at an advanced exploration or planning stage.

At Storuman, in Sweden, the Company is engaged in a Preliminary Feasibility Study (PFS) targeting production of at least 100,000 tonnes per year of acid grade fluorspar. A mining operation of this scale will be a medium scale producer in world terms and the deposit is large enough to support higher levels of production in the future.

The PFS will be based on the large JORC compliant Mineral Resource defined last year and will draw together various component studies including metallurgical testwork, mine design, engineering design, capital and operating cost estimates. The completion of this study, scheduled for early 2013, will be a major value adding milestone for the project.

Environmental permitting is also in progress with the objective to submit a mining lease application by the end of the first quarter of 2013 and the environmental permit application by second quarter of 2013. Mine construction is targeted to start at the end of 2014.

Progress has also been made at the Company's second fluorspar project at Lassedalen, 80km southwest of Oslo in Norway where, in January, the Board announced the first JORC compliant Mineral Resource estimate at four million tonnes grading 25% fluorspar.

This was quickly followed with the award, to Wardell Armstrong International, of a technical and economic scoping study for development of Lassedalen. Completion of this report, the first economic evaluation of the project, is scheduled for the third quarter of this year and will incorporate the results of the scoping-level programme of metallurgical testwork now nearing completion.

Tertiary now controls JORC Minerals Resources totalling nearly four million tonnes of contained fluorspar across its two Scandinavian projects and mineralisation at both projects remains open. A large drill programme is planned at Lassedalen following completion of the scoping study.

The Company maintains its portfolio of gold, tantalum-niobium-rare earth and iron projects most of which are awaiting the grant or renewal of exploration rights. These have the potential to add substantial value with positive licence developments.

Results  

The Group is reporting a loss for the six month period of £190,469 (six months to 31 March 2011: £143,524). This loss comprises administration costs of £185,009 (which includes share based payments of £28,746), pre-licence (reconnaissance) costs totalling £7,838 and interest income of £2,378.

The Company's projects and programmes continue to deliver promising results and the Board expects to build on this as the projects progress through the feasibility stages. To help position the Company for production the Board has recently been strengthened with the appointment of Richard Clemmey as Operations Director following his appointment as Project Manager in 2011.

This year promises to be a busy and exciting year for the Company. The Board anticipates strong news flow from a number of value-adding milestones and looks forward to updating shareholders in due course.

Patrick L Cheetham                

Executive Chairman

17 May 2012

ENQUIRIES:

Tertiary Minerals plc                                                            Tel:  [phone]

Patrick Cheetham, Executive Chairman                               

www.tertiaryminerals.com

Seymour Pierce Limited                                                      Tel: [phone]

Stewart Dickson (Corporate Finance)

Jeremy Stephenson (Corporate Broking)                                          

Yellow Jersey PR Limited                                                   Tel: [phone]

Dominic Barretto                                  

:

Consolidated Income Statement

for the six months to 31 March 2012

	Six months  to 31 March 2012 Unaudited		Six months to 31 March 2011  Unaudited		Twelve months  to 30 September       2011 Audited
	£		£		£
Pre-licence exploration costs	7,838		7,665		12,606
Impairment of deferred exploration costs	-		-		-
Administrative expenses	185,009		137,457		282,181
Operating loss	(192,847)		(145,122)		(294,787)
Interest receivable	2,378		1,598		5,114
Loss on ordinary activities before taxation	(190,469)		(143,524)		(289,673)
Tax on loss on ordinary activities	-		-		-
Loss for the period attributable to equity holders of the  parent	(190,469)		(143,524)		(289,673)
Loss per share - basic and fully diluted (pence) (note 2)	(0.16)		(0.14)		(0.26)

Consolidated Statement of Comprehensive Income

for the six months to 31 March 2012

	Six months to  31 March 2012 Unaudited		Six months to  31 March  2011 Unaudited		Twelve months to  30 September 2011                  Audited
	£		£		£
Loss for the period	(190,469)		(143,524)		(289,673)
Movement in revaluation of available for sale investment	56,653		597,441		118,458
Foreign exchange translation differences on foreign currency net investments in subsidiaries	9,315		18,952		(6,927)
Comprehensive (loss)/income for the period attributable to the equity holders of the parent	(124,501)		472,869		(178,142)

Company Registration Number 03821411

Consolidated Statement of Financial Position

at 31 March 2012

	As at  31 March 2012 Unaudited		As at  31 March 2011 Unaudited		As at 30 September 2011 Audited
	£		£		£
Non-current assets
Intangible assets	1,648,990		1,117,145		1,376,946
Property, plant & equipment	18,930		25,044		22,845
Available for sale investment	342,499		764,830		285,846
	2,010,419		1,907,019		1,685,637
Current assets
Receivables	78,306		104,476		87,970
Cash and cash equivalents	764,816		1,613,044		1,178,941
	843,122		1,717,520		1,266,911
Current liabilities
Trade and other payables	161,271		(212,532)		(164,523)
Net current assets	681,851		1,504,988		1,102,388
Net assets	2,692,270		3,412,007		2,788,025
Equity
Called up share capital	1,188,161		1,188,161		1,188,161
Share premium account	6,449,238		6,449,238		6,449,238
Merger reserve	131,096		131,096		131,096
Share option reserve	216,313		160,538		187,567
Available for sale revaluation reserve	59,770		482,100		3,117
Foreign currency reserve	145,667		162,231		136,352
Accumulated losses	(5,497,975)		(5,161,357)		(5,307,506)
Shareholders' funds	2,692,270		3,412,007		2,788,025

                        Consolidated Statement of Changes in Equity

	Share Capital	Share Premium account	Merger reserve	Share Option reserve	Available for sale revaluation reserve	Foreign currency reserve	Accumulated losses	Total
	£	£	£	£	£	£	£	£
At 30 September 2010	885,162	5,035,112	131,096	133,096	(115,341)	143,279	(5,017,833)	1,194,571
Loss for the period	-	-	-	-	-	-	(143,524)	(143,524)
Change in fair value	-	-	-	-	597,441	-	-	597,441
Exchange differences	-	-	-	-	-	18,952	-	18,952
Total comprehensive
loss for the period	-	-	-	-	597,441	18,952	(143,524)	472,869
Share issue	302,999	1,414,126	-	-	-	-	-	1,717,125
Share based payments	-	-	-	27,442	-	-	-	27,442
At 31 March 2011	1,188,161	6,449,238	131,096	160,538	482,100	162,231	(5,161,357)	3,412,007
Loss for the period	-	-	-	-	-	-	(146,149)	(146,149)
Change in fair value	-	-	-	-	(478,983)	-	-	(478,983)
Exchange differences	-	-	-	-	-	(25,879)	-	(25,879)
Total comprehensive
loss for the period	-	-	-	-	(478,983)	(25,879)	(146,149)	(651,011)
Share based payments	-	-	-	27,029	-	-	-	27,029
At 30 September 2011	1,188,161	6,449,238	131,096	187,567	3,117	136,352	(5,307,506)	2,788,025
Loss for the period	-	-	-	-	-	-	(190,469)	(190,469)
Change in fair value	-	-	-	-	56,653	-	-	56,653
Exchange differences	-	-	-	-	-	9,315	-	9,315
Total comprehensive
profit for the period	-	-	-	-	56,653	9,315	(190,469)	(124,501)
Share based payments	-	-	-	28,746	-	-	-	28,746
At 31 March 2012	1,188,161	6,449,238	131,096	216,313	59,770	145,667	(5,497,975)	2,692,270

Consolidated Statement of Cash Flows

for the six months to 31 March 2012

	Six months  to 31 March 2012 Unaudited		Six months  to 31 March  2011 Unaudited		Twelve months to 30 September  2011 Audited
	£		£		£
Operating activities
Operating loss	(192,847)		(145,122)		(294,787)
Issue of shares in lieu of net wages	-		-		-
Depreciation charge	4,048		2,222		5,984
Impairment charge	-		-		-
Share based payment charge	28,746		27,442		54,471
Decrease/(increase) in receivables	9,666		(62,213)		(45,709)
(Decrease)/Increase in payables	(3,252)		116,751		68,742
Net cash outflow from operating activity	(153,639)		(60,920)		(211,299)
Investing activities
Interest received	2,378		1,598		5,114
Purchase of intangible assets	(271,630)		(388,275)		(666,855)
Purchase of property, plant & equipment	(133)		(26,030)		(27,591)
Net cash outflow from investing activity	(269,385)		(412,707)		(689,332)
Financing activity
Issue of share capital (net of expenses)	-		1,717,125		1,717,125
Net cash inflow from financing activity	-		1,717,125		1,717,125
Net (decrease)/increase in cash and cash equivalents	(423,024)		1,243,498		816,494
Cash and cash equivalents at start of period	1,178,941		370,334		370,334
Exchange differences	8,899		(788)		(7,887)
Cash and cash equivalents at end of period	764,816		1,613,044		1,178,941

Notes to the Interim Statement

1.       Basis of preparation

The interim financial statements are unaudited and do not constitute statutory accounts as defined within the Companies Act 2006.

The interim financial statement has been prepared on the basis of the recognition and measurement requirements of International Financial Reporting Standards (IFRS) as adopted by the European Union (EU), and their interpretations adopted by the International Accounting Standards Board (IASB). As is permitted by the AIM rules the directors have not adopted the requirements of IAS34 "Interim Financial Reporting" in preparing the financial statements. Accordingly the financial statements are not in full compliance with IFRS. The accounting policies used in the preparation of the interim financial information are the same as those used in the Company's audited financial statements for the year ended 30 September 2011.

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 prepare annual budgets and cash flow projections that extend beyond 12 months from the date of this report. These projections include the proceeds of future fundraising necessary within the next 12 months to meet the Company's and Group's planned discretionary project expenditures and to maintain the Company and Group as a going concern. Although the Company has been successful in raising finance in the past, there is no assurance that it will obtain adequate finance in the future. This represents a material uncertainty related to events or conditions which may cast significant doubt on the entity's ability to continue as a going concern and, therefore, that it may be unable to realize its assets and discharge its liabilities in the normal course of business. However, the directors have a reasonable expectation that they will secure additional funding when required to continue meeting corporate overheads and exploration costs for the foreseeable future and therefore believe that the going concern basis is appropriate for the preparation of the financial statements.

2.       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 2012 Unaudited	Six months to 31 March  2011 Unaudited	Twelve months  to 30 September                    2011 Audited
Loss for the period (£)	(190,469)	(143,524)	(289,673)
Weighted average shares in issue (No.)	118,816,214	106,216,216	112,533,476
Basic loss per share (pence)	(0.16)	(0.14)	(0.26)

The loss attributable to ordinary shareholders and the weighted average number of ordinary shares used for the purpose of calculating diluted earnings per share, are identical to those used to calculate 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.

2.      Share capital  

During the six months to 31 March 2012 no share issues took place.

3.      Interim report

Copies of this interim report are available from Tertiary Minerals plc, Silk Point, Queens Avenue, Macclesfield, Cheshire, SK10 2BB, United Kingdom.  It is also available on the Company's website at www.tertiaryminerals.com

 

END

 

 

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