Interim Results

RNS Number : 6145K

Niger Uranium Limited

22 December 2008

 



For immediate release  

 22 December 2008

Niger Uranium Limited 
('Niger Uranium' or the 'Company')

Unaudited Results for the six months ended 30 September 2008

CHAIRMAN'S REPORT

I am pleased to report to shareholders the second interim financial statements for Niger Uranium Limited.  Niger Uranium's strategy is to fast-track its projects to the production stage, whilst pursuing quality prospects and acquiring near term and advanced projects. An example of this is the recent acquisition of the Henkries project in the Northern Cape in South Africa, a relatively near term uranium opportunity. Niger Uranium has acquired a diversified portfolio of uranium projects; both in Niger and South Africa and at project sites elsewhere in Africa and South America in which the Company has a considerable stake.  

The investment climate in the Republic of Niger remains positive. Areva, the integrated French nuclear engineering and mining company, has continued to invest, and CAMECO, the world's largest uranium producer, recently announced a US$28 million investment in GoviEx, an exploration company in the Republic of Niger. The Chinese-operated Azelik deposit is nearing production, with start-up planned for 2010 and an Initial expected output of 1.5 Million lbs U3O8 per year. Niger remains the largest uranium production country in Africa and ranks fifth worldwide in uranium production.

Highlights

The progress made during the 6 months to 30 September 2008 is summarised as follows:

NIGER

• An experienced technical, geological, operational and management team has been established along with a supporting back office infrastructure at our Johannesburg headquarters. The 14-man team in Niger is mobilised on the ground and has detailed operational knowledge of the Country's regulatory, geological, mining and operational environments. 

• In August 2008, a maiden resource statement was announced for the In Gall target. This target was the third area tested by the Company in just over six months of operation. The Board was pleased that a new Uranium resource had been discovered so early in our exploration programme and believes that it reflects the calibre of the team and the quality of the licence areas. MSA Geoservices of Johannesburg completed the SAMREC-compliant Inferred Resource of 14.06 million tonnes, at an average grade of 141.5 ppm eU3O8 using a 100 ppm cut-off (containing 4.39 million pounds eU3O8).  

• A radon and geochemical survey commenced in early November 2008 on the Irhazer license area.The exploration team is targeting an apparent repetition of the type of geological setting present at Azelik, to the west of the license area where a significant uranium resource is being developed. The Company believes that radon detection, coupled with conventional geochemistry and geological interpretation, is the best means of detecting a potential 'buried' deposit, which may be obscured due to the presence of a cover of younger sediments in the area. Results of the radon and geochemical survey will be integrated with geological data and statistical analysis carried out to identify targets which will be ranked and drill tested. Drilling is planned to commence within 8 weeks of completion of the survey.  

HENKRIES, SOUTH AFRICA

• On 1 September 2008, the group announced, subject to the completion of certain conditions precedent, the acquisition of 100% of URU Henkries Limited, a private BVI registered company, which on completion will hold 74% of the issued capital of Namakwa Uranium (Pty) Ltd, a South African private limited company. Namakwa Uranium (Pty) Ltd is the owner of the Henkries uranium deposit, held under prospecting license 885/2007PR ('Henkries Deposit').

• The Henkries Deposit, in South Africa, covers 58,375 hectares and includes a historic (non-code compliant) resource estimate prepared by Anglo Operations Limited (AOL) in 1979 of 4.18 million tonnes at 405 ppm U3O8 containing 3.72 million pounds U3O8, using a 100 ppm cut-off grade. The Henkries deposit occurs close to surface; a strip ratio of 2.35:1 was previously calculated. The host sediments are soft and will not require blasting. AOL conservatively estimated that a 85% recovery of uranium would be possible.

• Fieldwork has commenced in preparation for a pre-feasibility study scheduled to commence in the second quarter of 2009. 500 metres of core drilling at 'Henkries Central' will commence mid-January 2009 to verify the resource defined by AOL. Following this verification drilling, a 4500 metre drilling programme will commence north of Henkries Central, at a previously identified area containing significant mineralization. 

• Niger Uranium has a total project exploration target of 10 million pounds U3O8, hosted within near surface (less than 15 metres depth) that will not require blasting. A pre-feasibility study is scheduled to commence in the second quarter of 2009, following completion of the drilling and resource estimation work.

• An application has been submitted to the South African Minister of Minerals and Energy for the approval of the transfer to URU Henkries of the Namakwa shareholding as governed by Section 11 of the Mineral and Petroleum Resources Development Act, 2002. Until this approval is received, Namakwa Uranium will continue the process of verification and expansion of the historically defined uranium deposit.

OTHER ACTIVITIES

• The Company also acquired interests in Kalahari Minerals plc and UrAmerica Limited ('UrAmerica'), which has expanded and diversified the portfolio of uranium assets and interests into Namibia and South America.

• During February and March 2008, Niger Uranium acquired 27.68m shares in Kalahari Minerals which, at that time, represented 16.6 per cent. of Kalahari's issued share capital. The acquisition provides the Company with interests in nearer-term potential uranium production in Namibia, a country which takes a positive approach to the development of mining projects.

• In April 2008, Niger Uranium acquired a 20.9% interest in UrAmerica Limited, which provides the company with a strategic interest in prospective areas in South America, in particular Argentina, where UrAmerica has significant uranium exploration projects and an established management team with strong technical skills. Successful fieldwork completed on claims in the Salta and Chibut Provinces identified several areas of uranium mineralisation within which detailed mapping, surface sampling and trenching has been carried out.  A programme of additional sampling to better define these targets is underway and it is anticipated that the best targets will be drill tested during 2009.

• As at 30 September 2008, due to the lack of formal financial information and no proven resource statement, the investment of USD 4.3 million in UrAmerica was impaired in full. It is anticipated that a full set of financial statements for UrAmerica for the year to 31 December 2008 will be provided to Niger Uranium during the first quarter of 2009, following which the impairment will be reviewed.

• As at 30 September 2008, the Company had cash of USD 3.6 million with no borrowings.

Management and Board

At an Extraordinary General Meeting held on 18 September 2008, shareholders voted to retain the management and executive teams, a clear vote of confidence in the strategy and recognition of the progress made to date.

Outlook

Since incorporation the Company has progressed its stated investment and development objectives of effecting growth, both organically and through acquisition, with the target of achieving production and revenues in the shortest possible timescale.

The Board believes that the Henkries Project has the potential to become a producing mine in the near-term. The company is targeting commencement of production by the final quarter of 2011 and has mobilised its technical teams whilst co-ordinating project development from its Johannesburg office and working with its Black Economic Empowerment partners. 

The company is also in the process of advancing its late-stage green-field projects in Niger at its In Gall and Irhazer licenses.  Within its 100 percent owned Irhazer license area in Niger, a 1600 point radon and geochemical survey has commenced on the company's highest priority targets. 

Despite the recent volatility in the uranium spot price, which the Board believes has been affected by the global financial instability, the fundamentals of the uranium industry remain positive. The Board is encouraged by the uranium price regaining ground, with uranium-oxide concentrate for immediate delivery, rising to US$55 a pound in November 2008. Denver-based pricing service TradeTech LLC noted in the 21 November 2008 report that although weekly demand totalled 6.5 million pounds, this was about 2 million pounds more than supply. Given the potential shortfall in supply, the development of African uranium resources augurs well. Presently South Africa, Namibia and Niger are the three main uranium producing countries in Africa.

The Board is satisfied with the progress made by the company towards becoming a geographically diversified uranium producer and remains confident about future growth prospects.

Ian Stalker

Executive Chairman

22 December 2008

Contacts:

Niger Uranium Limited

Ian Stalker, Executive Chairman                                Tel: [phone]

Beaumont Cornish Limited                                     Tel: [phone]

Michael Cornish

Forward Looking Statements:

This press release contains statements that are 'forward-looking'. Generally, the words 'expect,' 'intend,' 'estimate,' 'will' and similar expressions identify forward-looking statements. By their very nature, forward-looking statements are subject to known and unknown risks and uncertainties that may cause our actual results, performance or achievements, or that of our industry, to differ materially from those expressed or implied in any of our forward-looking statements. Statements in this press release regarding the Company's business or proposed business, which are not historical facts, are 'forward looking' statements that involve risks and uncertainties, such as estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.

Glossary of Terms:

Blasting	A mining practice using explosives to fragment rock for the purposes of removal.
Lbs	Pounds, an imperial unit of mass: 1 lb is equal to 0.454 kilograms.
Ppm	Parts per million, equal to gram per tonne. 1 ppm = 1 gram per tonne.
Pre-feasibility study	An assessment of the economic viability of a potential mining project to a reasonable to high level of confidence, normally preceding a Definitive Feasibility Study.  The study must consider all aspects of the project, including mine and processing plant design, waste disposal, environmental management and permitting.
Recovery	In this case meaning metallurgical recovery which is the proportion of the uranium that can be extracted by metallurgical processing of the ore, expressed as a percentage.
Resource	The term 'Mineral Resource' covers the in-situ mineralisation which has been identified and estimated through exploration/assessment and sampling; and from which Mineral Reserves may be derived by the application of technical, economic, legal, environmental, social, marketing, governmental and political factors.
SAMREC	South Africa's internationally accepted code for the reporting of Mineral Resources and Mineral Reserves as prepared by the SAMREC committee under the auspices of the South African Institute of Mining and Metallurgy. Historical estimates may be accurate but until verified under the current code, are termed non-code compliant or non-compliant.
U3O8	Triuranium octaoxide. 1 ppm U308 = 0.848 ppm U.

  Independent Auditor's Report

Report on Review of Condensed Consolidated Interim Financial Statements to members of Niger Uranium Limited

Introduction    

We have reviewed the accompanying condensed consolidated interim balance sheet of Niger Uranium Limited at 30 September 2008, and the related condensed consolidated interim income and cash flow statements for the 6 months then ended. The directors are responsible for the preparation and fair presentation of these condensed consolidated interim financial statements in accordance with International Financial Reporting Standards. Our responsibility is to express a conclusion on this condensed consolidated interim financial statements based on our review.

Scope of Review

We conducted the review in accordance with the International Standard on review Engagements 2410, Review of Interim Financial information Performed by the Independent Auditor of the Entity. A review of condensed consolidated interim financial statements consist of making enquiries, primarily of persons responsible for the financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed consolidated interim financial statements are not prepared, in all material respects in accordance with International Financial reporting Standards.

KPMG Inc.

Registered Auditor

 

Per Nick van Niekerk

Chartered Accountant (SA)

Director

21 December 2008

85 Empire Road

Parktown

South Africa

  CONDENSED CONSOLIDATED INTERIM BALANCE SHEET

Group USD’000’s	Note	Reviewed 30 September 2008	Reviewed 30 September 2007	Audited 31 March 2008
ASSETS
Non-current assets
Property, plant and equipment	5	573	285	564
Intangible assets	6	8,391	4,825	4,825
Other investments	7	16,099	-	15,362
		25,063	5,110	20,751
Current assets
Trade and other receivables		266	250	411
Cash and cash equivalents	8	3,651	27,718	14,923
		3,917	27,968	15,334
Total assets		28,980	33,078	36,085
EQUITY AND LIABILITIES
Equity
Share capital and premium	9	46,122	32,641	42,540
Foreign currency translation reserve		(65)	11	4
Share option reserve	10	4,055	2,429	4,055
Accumulated deficit		(21,946)	(3,048)	(11,486)
		28,166	32,033	35,113
Current liabilities
Trade and other payables		814	1,045	972
Total equity and liabilities		28,980	33,078	36,085

CONDENSED CONSOLIDATED INTERIM INCOME STATEMENT

Group USD’000’s	Note	Reviewed 6 months to 30 September 2008	Reviewed 4 months to 30 September 2007	Audited 21 May 2007 to 31 March 2008
Revenue		-	-	-
Salaries and wages		680	-	494
Share options expensed		-	1,640	2,954
General and administrative expenditure		1,356	608	2,421
Exploration and pre-feasibility expenditure		160	-	449
Foreign exchange differences		2,294	11	118
Impairment losses of financial assets		6,002	-	4,589
Warrant option expense		-	789	789
Operating loss	11	10,492	3,048	11,814
Finance income – net		(32)	-	(328)
Interest paid	12	1	-	1
Interest received	13	(33)	-	(329)
Net loss before taxation		10,460	3,048	11,486
Taxation	14	-	-	-
Net loss for the period		10,460	3,048	11,486
Loss per share
Basic loss per share (in US cents)	15	(0,10)	(0.04)	(0.14)

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY

Group USD’000’s	Share capital	Share premium	Foreign currency translation reserve	Share option reserve	Accumulated deficit	Total equity
Balance at date of incorporation	-	-	-	-	-	-
Shares issued	830	33,891	-	-	-	34,721
Share issue costs	-	(2,080)	-	-	-	(2,080)
Share based payment expense	-	-	-	2,429	-	2,429
Currency translation differences	-	-	11	-	-	11
Net loss for the period	-	-	-	-	(3,048)	(3,048)
Balance at 30 September 2007	830	31,811	11	2,429	(3,048)	32,033
Shares issued	170	9,734	-	-	-	9,904
Share issue costs	-	(5)	-	-	-	(5)
Currency translation differences	-	-	(7)	-	-	(7)
Share based payment expense	-	-	-	1,626	-	1,626
Net loss for the half year	-	-	-	-	(8,438)	(8,438)
Balance at 31 March 2008	1,000	41,540	4	4,055	(11,486)	35,113
Shares issued	132	3,450	-	-	-	3,582
Currency translation differences	-	-	(69)	-	-	(69)
Net loss for the half year	-	-	-		(10,460)	(10,460)
Balance at 30 September 2008	1,132	44,990	(65)	4,055	(21,946)	28,166

CONDENSED CONSOLIDATED INTERIM CASH FLOW STATEMENT

Group USD’000’s	Note	Reviewed 6 months to 30 September 2008	Reviewed 4 months to 30 September 2007	Audited 21 May 2007 to 31 March 2008
Cash flows from operating activities
Cash utilised by operations	18.1	(2,031)	(608)	(3,074)
Changes in net working capital	18.2	(13)	795	561
Cash utilised by operations		(2,044)	187	(2,513)
Net finance income		32	-	328
Net cash from operating activities		(2,012)	187	(2,185)
Cash flows from investing activities
Additions to property, plant and equipment		(174)	(284)	(637)
Additions to intangibles		(3,566)	(4,826)	(4,705)
Acquisition of financial assets		(9,070)	-	(10,186)
Net cash used in investing activities		(12,810)	(5,110)	(15,528)
Cash flows from financing activities
Issue of shares		3,582	34,721	34,721
Cost of share issues		-	(2,080)	(2,085)
Net cash from financing activities		3,582	32,641	32,636
Net cash flow for the period		(11,272)	27,718	14,923
Cash and cash equivalents at start of period		14,923	-	-
Cash and cash equivalents at 31 March		3,651	27,718	14,923

SELECTED NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

1. General information

Niger Uranium Limited ('the Company') and its subsidiaries ('together 'the group') seek out uranium mining opportunities around the world as an active investor and project developer. After its formation the group acquired exploration licences in the state of Niger. During the period under review the group conducted exploration activities in Niger and has made investments in companies with activities in the same sector within Southern Africa and South America.

The Company's shares were admitted to trading on AIM, a market operated by the London Stock Exchange on 12 September 2007.

Statement of compliance

The reviewed condensed consolidated interim financial statements for the 6 months ended 30 September 2008, have been prepared in accordance with the recognition and measurement requirements of International Financial Reporting Standards and the presentation and disclosure requirements of International Accounting Standard 34 - Interim Financial Reporting. The reviewed condensed consolidated interim financial statements do not include all of the information required for full annual financial statements and should be read in conjunction with the consolidated annual financial statements for the period since incorporation until the 31 March 2008. 

2. Basis of preparation

The condensed consolidated interim financial statements of Niger Uranium Limited and its subsidiaries have been prepared in accordance with International Financial Reporting Standards (IFRS). The condensed consolidated interim financial statements have been prepared under the historical cost convention, except for other investments which are stated at fair value. The condensed consolidated interim financial statements are presented in thousands of United States Dollars unless otherwise stated.  

3. Accounting policies

The accounting policies adopted are consistent with those of the annual financial statements for the period since incorporation on 21 May 2007 to 31 March 2008, as described in the annual financial statements for the period ended 31 March 2008.  

4. Segment information

Segmental information is presented in respect of the Group's geographical and operational segments. Segmental information, assets, liabilities, income and expenses include items directly attributable to the segment that can be allocated on a reasonable and consistent basis. As the business is currently only involved in exploration only geographic segments have been provided

Group USD’000’s	Reviewed 6 months to 30 September 2008			Reviewed 4 months to 30 September 2007			Audited 21 May 2007 to 31 March 2008
Geographic segment	South Africa	Niger	Total	South Africa	Niger	Total	South Africa	Niger	Total
USD’000
Finance Income	(32)	-	(32)	-	-	-	(328)	-	(328)
Depreciation	11	56	67	-	-	-	17	56	73
Impairment of financial assets	6,002	-	6,002	-	-	-	4,589	-	4,589
Net loss	9,987	472	10,459	2,558	490	3,048	10,688	798	11,486
Total assets	23,812	5,168	28,980	32,033	5,110	33,078	30,917	5,168	36,085
Total liabilities	(807)	(7)	(814)	-	(1,045)	(1,045)	(872)	(100)	(972)
Net assets	232,005	5,161	28,166	27,968	4,065	32,033	30,445	5,068	35,113
Capital expenditure	132	42	174	-	284	284	198	439	637

5. Property, plant and equipment
Group USD’000’s	Reviewed 6 months to 30 September 2008			Reviewed 4 months to 30 September 2007	Audited 21 May 2007 to 31 March 2008
	Cost	Accumulated  depreciation	Carrying value	Carrying  value	Carrying value
Exploration plant and equipment	149	(40)	109	152	139
Motor Vehicles	258	(49)	209	77	189
Computer equipment	169	(18)	151	-	120
Furniture and equipment	123	(19)	104	55	116
	699	(126)	573	284	564
Reconciliation of carrying value for the six months ended 30 September 2008
	Exploration plant and equipment	Motor  vehicles	Computer equipment	Furniture and office equipment	Total
Balance at date of incorporation	-	-	-	-	-
Additions	152	77	-	55	284
Carrying value at 30 September 2007	152	77	-	55	284
Additions	8	140	133	72	353
Depreciation	(21)	(28)	(13)	(11)	(73)
Net carrying value at 31 March 2008	139	189	120	116	564
Exchange differences	(25)	(25)	-	(12)	(62)
Additions	18	109	36	11	174
Disposals	-	(36)	-	-	(36)
Depreciation	(23)	(28)	(5)	(11)	(67)
Net carrying value at 30 September 2008	109	209	151	104	573

6. Intangible assets
Group USD’000’s			Reviewed 6 months to 30 September 2008	Reviewed 4 months to 30 September 2007	Audited 21 May 2007 to 31 March 2008
Licences			8,391	4,825	4,825
Net carrying value			8,391	4,825	4,825
Reconciliation of carrying value for the  six months ended 30 September 2008
		Northwestern Licences	UraMin Licences	Namakwa Licences	Total
Balance at date of incorporation		-	-	-	-
Additions		4,705	120	-	4,825
Carrying value at 30 September 2007		4,705	120	-	4,825
Movement		-	-	-	-
Carrying value at 31 March 2008		4,705	120	-	4,825
Acquisition - see note 16		-	-	3,566	3,566
Carrying value at 30 September 2008		4,705	120	3,566	8,391

During the period the company has, subject to certain conditions precedent, purchased 74% of Namakwa Uranium (Pty) Ltd which is disclosed further under the Business Combinations note herein. The purchase price has been provisionally attributed to exploration licences and deposits. On completion of the transaction, the group will finalise the allocation of the purchase price, which should take place within the first quarter of 2009. 

7. Other investments
USD’000’s
Available-for-sale financial assets				Fair value	Group
Listed securities:
-          Kalahari Minerals plc				16,099	16,099
Unlisted securities:
-          UrAmerica Limited				-	-
Total				16,099	16,099

The group held 20 million ordinary shares in Kalahari Minerals plc ('Kalahari'), which shares are traded on AIM, a market operated by the London Stock Exchange.

During the period under review the Company acquired a further 7.68 million shares in Kalahari Minerals, to increase the total shareholding to 27.68 million shares, representing a 16.7 % of the shares (and voting power) in issue. The movement in other investments is detailed below:

Listed securities:
Details on the acquisition of investment in Kalahari Minerals plc
Group USD’000’s		Reviewed 6 months to 30 September 2008	Reviewed 4 months to 30 September 2007	Audited 21 May 2007 to 31 March 2008
Opening carrying value		15,362	-	-
Acquired		4,771	-	20,090
-          Paid from cash reserves		4,771	-	10,186
-          Issue of NUL shares		-	-	9,904
Unrealised foreign exchange translation differences		(2,185)	-	(139)
Fair value adjustment		(1,849)	-	(4,589)
Carrying value at 30 September 2008		16,099	-	15,362

The NUL shares issued to the vendors in consideration for the acquisition of the Kalahari shares are not subject to any trading restrictions.

Unlisted securities:
Details on the acquisition of an investment in UrAmerica Limited
Group USD’000’s		Reviewed 6 months to 30 September 2008	Reviewed 4 months to 30 September 2007	Audited 21 May 2007 to 31 March 2008
Acquired		4,299	-	-
-          Paid from cash reserves		2,500	-	-
-          Issue of NUL shares		1,799	-	-
Unrealised foreign exchange translation differences		(146)	-	-
Impairment		(4,153)	-	-
Carrying value at 30 September 2008		-	-	-

In addition to the 4,421,000 shares in UrAmerica Limited, the Company has been issued with 4,421,000 warrants to subscribe for a further 4,421,000 new UrAmerica ordinary shares at a an exercise price of USD 1.639 per new UrAmerica ordinary shares and which is exercisable at any time before 20 April 2010.

Based on information provided by UrAmerica Limited management, as at 30 September 2008, the Company has impaired the carrying value by USD 4.153 million. The impairment combined with the unrealised foreign exchange differences, has resulted in the unlisted financial assets being carried at zero value.  As a consequence of the impairment of the carrying value of the ordinary shares, no value has been ascribed to the warrant options. 

The summary of available-for-sale financial assets is as follows:
Group USD’000’s		Reviewed 6 months to 30  September 2008	Reviewed 4 months to 30 September 2007	Audited 21 May 2007 to 31 March 2008
Balance at beginning of period		15,362	-	-
Additions		9,070	-	20,090
Unrealised foreign exchange translation differences		(2,331)	-	(139)
Impairment and fair value adjustments		(6,002)	-	(4,589)
Carrying value		16,099	-	15,362
Less: Short term portion		-	-	-
Carrying value at 30 September 2008		16,099	-	15,362

Due to the decrease in the value of certain of the British Pound Sterling denominated available-for-sale financial assets, and unrealised foreign exchange difference of USD 2.331 million has been recognised during the reporting period.

The value of the available-for-sale financial assets is estimated by reference to the published closing price quotation of the London Stock Exchange at the reporting date. Due to the reduction in the trading price of the financial assets, the Group has impaired the value the listed financial assets by USD 1.849 million at the period end. 

8. Cash and cash equivalents
Group USD’000’s		Reviewed 6 months to 30  September 2008	Reviewed 4 months to 30 September 2007	Audited 21 May 2007 to 31 March 2008
Cash on hand		3	-	6
Call and notice deposits		3,648	27,718	14,917
		3,651	27,718	14,923

The carrying amounts approximate fair value due to the short maturities of these instruments.

Cash held in escrow

The company has entered into a share purchase agreement (the 'SPA') for the acquisition of URU Henkries Limited ('URU Henkries'), a private company which, on completion of the acquisition will result in Niger Uranium holding a 74 percent interest in the Henkries uranium project located in the Northern Cape province of South Africa. 

In accordance with the terms of the SPA, the Initial Cash Consideration of USD 1.75 million has been transferred to Conyers Dill & Pearman, solicitors based in the British Virgin Islands to be held in escrow, until such time as the full terms of the 'SPA' have been satisfied.

Deferred consideration

There is a deferred consideration payable to the vendors of Namakwa Uranium Limited based on the company establishing a JORC Code compliant 'Indicated' and 'Measured' uranium resource for the Henkries Project. The maximum additional consideration amounts to a further US$5.5 million in cash and a further 1,500,000 new Niger Uranium ordinary shares. 

9. Share capital
Ordinary shares
		Number of shares	Share capital USD’000	Share premium USD’000	Total   USD’000
Authorised share capital:
300 000 000 shares of USD 0.01 each		300,000,000	3,000		3,000
Issued share capital:
Initial issue of shares		83,000,000	830	33,891	34,721
Share issue expenses		-	-	(2,080)	(2,080)
Balance at 30 September 2007		83,000,000	830	31,811	32,641
Private placement		17,000,000	170	9,734	9,904
Share issue expenses		-	-	(5)	(5)
Balance at 31 March 2008		100,000,000	1,000	41,540	42,540
Issue of shares for UrAmerica acquisition		4,664,306	47	1,799	1,846
Issue of shares for Namakwa acquisition		8,500,000	85	1,651	1,736
Balance at 30 September 2008		113,164,306	1,132	44,990	46,122

Issue of shares for Namakwa acquisition - escrow arrangements

Pending the fulfilment of certain conditions precedent, both the cash payment of USD 1.75 million and 8,500,000 issued ordinary shares in the company have been placed with an escrow agent. Should the conditions precedent not be fulfilled by 31 March 2009, the company may extend the date of fulfilment of the conditions. Thereafter should the transaction not be completed, the company will sell the shares on the open market.

Deferred contingent issue of shares

There is a deferred consideration payable to the vendors of Namakwa Uranium Limited based on the company establishing a JORC Code compliant 'Indicated' and 'Measured' uranium resource for the Henkries Project. The maximum additional consideration amounts to a further US$5.5 million in cash and a further 1,500,000 new Niger Uranium ordinary shares. 

All issued shares are fully paid up.

In terms of the BVI Business Companies Act the unissued shares are under the control of the directors.

10. Share Option Reserve
Group
USD’000’s
The movement in the share option reserve is detailed below:
				Share Options	Warrant Options	Total
Balance at date of incorporation				-	-	-
Options expensed during the period to 30 September 2007				1,640	789	2,429
Share option reserve at 30 September 2007				1,640	789	2,429
Options expensed during 6 months to 31 March 2008				1,626	-	1,626
Share option reserve at 31 March 2008				3,266	789	4,055
Movement				-	-	-
Share option reserve at 30 September 2008				3,266	789	4,055

 10. (a) Share Options

The Niger Uranium Limited Share Option Plan 2008 is administered by the Board of Directors, which determines individual eligibility under the plan the number of shares reserved for optioning to each individual. Besides the initial tranche of 2,602,400 options which vested immediately, the subsequent allotments vest to a maximum of one third over a period of three years. The details of the movement of Niger Uranium's share options as well as reconciliation to the Company's share options outstanding at 30 September 2008 are shown in the table herein.  

The following is a summary of the group’s options granted under its Share Incentive Scheme:
				Number of options	Weighted average exercise price GBP
Balance at date of incorporation				-	-
Share options granted during the period to 30 September 2007				2,602,400	0.50
Balance of share options at 30 September 2007				2,602,400	0.50
Share options granted during the 6 months to 31 March 2008				3,930,000	0.44
Balance of share options at 31 March 2008				6,532,400	0.47
Share options granted during the period to 30 September 2008				-
Balance of share options at 30 September 2008				6,532,400	0.47

No share options were forfeited, exercised or expired during the six months ended 30 September 2008. 

Subsequent to the year end, a further 2,600,000 share options were issued to directors, management and staff at an exercise price of GBP 0.09.

10. (b) Warrant options

As at 30 September 2008, the following warrant options, issued in respect of capital raising, had been granted but not exercised.

The following is a summary of the group’s warrant options granted:

Name

Date Granted

Date Vested

Number of warrants

Exercise Price (GBP)

Expiry Date

Fair Value at Grant Date (GBP)

Regent Resources

12 Sept 2007

12 Sept 2007

544,065

0.50

11 Sept 2009

0.2749

Haywood Securities

12 Sept 2007

12 Sept 2007

601,335

0.50

11 Sept 2009

0.2749

Beaumont Cornish

12 Sept 2007

12 Sept 2007

250,000

0.50

11 Sept 2010

0.1801

1,395,400

No warrant options lapsed, were cancelled or were exercised during the six months ended 30 September 2008. 

Share based payments

The assessed fair value at grant date is determined using the Black-Scholes Model that takes into account the exercise price, the term of the option, the share price at grant date, the expected price volatility of the underlying share, the expected dividend yield and the risk-free interest rate for the term of the option.

 

 

 

11. Loss for the period
Group USD’000’s		Reviewed 6 months to 30  September 2008	Reviewed 4 months to 30 September 2007	Audited 21 May 2007 to 31 March 2008
The following items have been charged in arriving at the operating loss for the period
Auditors remuneration		46	-	19
Directors fees		332	25	531
-          Fees for services as director		65	25	280
-          Basic salary		117	-	234
-          Expense allowance		150	-	17
Legal fees		233	28	196
Operating lease payments		58	-	44
Depreciation		67	-	73
Foreign exchange loss/(gain)
-realised		11	-	(1)
-unrealised		2,394	-	119
Impairment of financial assets		6,002	-	4,589
Loss on disposal of property, plant and equipment		32	-	-
Salaries and wages		519	1,640	3,448
-          Share options expensed – Directors		-	1,640	2,954
-          Share options expensed – staff		-	-	311
-          Staff cost - salaries		519	-	183
Warrant options expensed		-	789	789

 

12. Interest paid
Interest paid		1	-	1

 

 

13. Interest received
Interest received		(33)	-	(329)

 14. Taxation and Deferred taxation

No Company taxation has been provided by the group because it has a calculated tax loss. 

A deferred tax asset has not been recognised because of the uncertainty that future taxable profit will be available against which temporary differences can be utilised.

15. Basic loss per share
Group
The basic loss per share is calculated using:
Loss for the period (USD’000’s)				(10,460)
And a weighted average number of shares in issue				105,654,468
Basic loss per share (US cents)				(0.10)
The diluted loss per share is calculated using:
Loss for the period (USD’000’s)				(10,460)
Weighted average number of shares in issue				105,654,468
Effect of share options on issue				6,532,400
Effect of warrant options on issue				1,395,400
Weighted average number of ordinary shares (diluted) at 30 September 2008				113,582,106
Diluted loss per share (US cents)				(0.09)

16. Business combinations
On 1 September 2008, the group announced, subject to the completion of certain conditions precedent, the acquisition of 100% of URU Henkries Limited, a private BVI registered company, which on completion will hold 74% of the issued capital of Namakwa Uranium (Pty) Ltd, a South African private limited company. Namakwa Uranium (Pty) Ltd is the owner of the Henkries uranium deposit, held under prospecting license 885/2007PR (“Henkries Deposit”) The initial consideration payable to Namakwa Uranium (Pty) Ltd comprised USD 1.75 million in cash together with 8,500,000 new Niger Uranium Limited ordinary shares. There is also a deferred consideration payable based on establishing a JORC code compliant uranium resource. The maximum additional consideration amounts to a further USD 5.5 million in cash and a further 1, 500, 000 new Niger Uranium shares. The remaining 26 percent of Namakwa Uranium will continue to be held by Namakwa’s BEE partner, Gilstra Exploration cc.   An application has been submitted to the South African Minister of Minerals and Energy for the approval of the transfer to URU Henkries of the Namakwa shareholding as governed by Section 11 of the Mineral and Petroleum Resources Development Act, 2002.   During this period, Namakwa Uranium will continue the process of verification and expansion of the historically defined uranium deposit.   As this is an exploration project there is no contribution to revenues and an expense of USD 18,000 would have been incurred for the period from acquisition to the period end. Had the acquisition occurred on 1 April 2008, there would have been no contribution to revenue but an expense of USD 90,918 would have been incurred.
Details of net assets acquired are as follows:
Group USD’000’s
Purchase consideration:
-          cash paid							1,750
-          Issue of 8, 500, 000 ordinary shares							1,775
-          Foreign exchange difference							40
Total purchase consideration							3,565
Fair value of net identifiable assets acquired (see below)							3,565

The Henkries Deposit, explored by Anglo American in 1979, includes a historical non code compliant resource estimate of 4.18 million tonnes at 405ppm U3O8 containing 3.72 million pounds U3O8 using a 100ppm cut off grade. As the results of the comprehensive historical exploration have been determined by MSA Geoservices (Pty) Ltd to be credible, the purchase consideration has initially been attributed to the Namakwa Uranium (Pty) Ltd exploration licences - see note 6 Intangible Assets herein.

As the acquisition is subject to certain conditions precedent, the group is yet to finalise the amount of the fair value of the net assets acquired.

The assets and liabilities arising from the acquisition are as follows:
USD'000's					Acquiree's carrying amount		Preliminary fair value
Exploration licences					3.561		3,561
Deposits acquired					4		4
Net identifiable assets acquired					3,565		3,565
17.Contingent liabilities and commitments
Group USD'000's				Reviewed 6 months to 30 September 2008		Reviewed  4 months to 30 September 2007	Audited 21 May  2007 to 31 March  2008
Operating lease commitments The future minimum lease payments under non-cancellable leases are
Less than 1 year				52		-	46
Later than 1 year but less than 5 years				53		-	64
More than 5 years				-		-	-
				105		-	110
Deferred consideration
Maximum payable to:						Shares (000's)	USD'000's
Namakwa Uranium Limited vendors						1,500	5,500

Deferred consideration

There is a deferred consideration payable to the vendors of Namakwa Uranium Limited based on the company establishing a JORC Code compliant 'Indicated' and 'Measured' uranium resource for the Henkries Project. The maximum additional consideration amounts to a further US$5.5 million in cash and a further 1,500,000 new Niger Uranium ordinary shares. 

18. Notes to the cash flow statement
18.1 Cash utilised by operations
Group USD’000’s		Reviewed 6 months to 30 September 2008	Reviewed 4 months to 30 September 2007	Audited 21 May 2007 to 31 March 2008
Loss before taxation		(10,460)	(3,048)	(11,486)
Adjusted for:
-Depreciation		67	-	73
-Loss on disposal of property, plant and equipment		32	-	-
-Share based payments		-	1,640	3,265
-Warrant options expensed		-	789	789
-Impairment of available-for-sale financial assets		6,002	-	4,589
-Finance income –net		(32)	-	(328)
-Unrealised foreign exchange loss		2,360	11	24
Cash utilised by operations		(2,031)	(608)	(3,074)

18.2 Changes in net working capital
Group USD'000's		Reviewed 6 months to 30 September 2008	Reviewed 4 months to 30 September 2007	Audited 21 May  2007 to 31  March  2008
Increase/decrease in:
Trade and other receivables		145	(250)	(411)
Trade and other payables		(158)	1,045	972
		(13)	795	561

19. Events after the balance sheet date

     (i) Directors

On 17 October 2008, Mr. James Mellon, resigned as both the non-executive chairman and as a director, at which time Mr. Ian Stalker was appointed non-executive Chairman

On 11 November 2008, Mr. John Sanders tendered his resignation as Chief Executive Officer. Mr Sanders however will continue to act as a non-executive director. Whilst the company intends to appoint a new Chief Executive Officer, Mr. Ian Stalker was appointed Executive Chairman and assumes, temporarily, the Chief Executive Officer' s responsibilities.

     (ii) Share options

Subsequent to the year end, a further 2,600,000 share options were issued to directors, management and staff at an exercise price of GBP 0.09.

20. Related party disclosure

NWT Uranium Inc.

At 30 September 2008, NWT Uranium Inc (formerly Northwestern Mineral Ventures Inc.) held 31,955,000 (28.2%) of the shares of Niger Uranium Limited. 

NWT Uranium Inc and UraMin Inc were parties to the original formation and incorporation of the Company in May 2007 and, under agreement, it was agreed that NWT Uranium Inc would be re-imbursed for all expenses incurred by them until the Company was able to fund all expenses directly. 

At 30 September 2008, an accrual of US Dollars 554,934 was made in respect of expenses incurred by NWT Uranium Inc. on behalf of the Group. This amount covered the period from May 2007 through to December 2007 and no further payment or accrual will be required.

Templar Minerals Limited / Polo Resources Limited 

Through a commonality of directors, Niger Uranium Limited is associated with the day to day financial operations of Templar Minerals Limited and Polo Resources Limited, both of whose shares are traded on AIM. 

As a result, at Niger Uranium Limited's South African based administration centre in Johannesburg, and with effect from 1 January 2008, several staff members were involved in the investor relations, accounting and procurement functions of all three companies. For providing this service, Niger Uranium Limited is entitled to recharge both Templar Minerals and Polo Resources a proportion of the costs of running the Johannesburg centre.

During the period 1 April 2008 to 25 September 2008, Niger Uranium paid expenses totalling US Dollars 666,970 on behalf of Templar Minerals Limited, all of which had been repaid to Niger Uranium by 30 September 2008.

As entitled, Niger Uranium charged Templar Minerals Limited an amount of US Dollars 140,845 for providing this and other specified administrative services during the period 1 April to 31 August 2008. This charge was paid by Templar Minerals at the end of August 2008.

At 30 September 2008, Templar Minerals Limited had repaid all monies due to Niger Uranium.

At 31 March 2008, Polo Resources is reflected as a trade and other receivable for US Dollars 8,972 in the accounts of Niger Uranium Limited, which amount was repaid by Polo Resources on 3 November 2008.

With effect from September 1 2008, no further administrative services were expected to be carried out by Niger Uranium on behalf of either Templar Minerals or Polo Resources and no administrative charge was made for the month of September. 

Transactions with key management personnel

At 30 September 2008, 6,532,400 share options had been issued to directors and employees and none had been exercised. The options were granted under recommendation of the Remuneration Committee and were granted in two separate tranches. The first award of 2,602,400 options were granted at an exercise price of GBP 0.50 each, whilst the second award of 3 930 000 options were granted at an exercise price of GBP 0.37 each

Subsequent to the year end, a further 2,600,000 share options were issued to directors, management and staff at an exercise price of GBP 0.09.

21. Other

A copy of this announcement is available from the Company's website, being www.niger-uranium.com.

CORPORATE DIRECTORY
Registered number		1405944 - Registered in British Virgin Islands
Directors		John Stalker – Executive Chairman
		Wayne Gordon Beach – Non Executive Director
		John Paul Lynch – Non Executive Director
		John Sanders – Non Executive Director – resigned as CEO on 11 November 2008
		Gordon Cassidy – Finance Director
		James Mellon – resigned as Chairman and Director on 17 October 2008
Registered office		Walkers Chambers
		P.O.Box 92
		Road Town, Tortola
		British Virgin Islands VG 1110
Business address		31 Impala Road
		Chiselhurston
		Sandton 2196
		South Africa
Reporting Accountants		KPMG Inc
		85 Empire Road
		Parktown
		Johannesburg
		South Africa 2193
Solicitors		Kerman & Co
		7 Savoy Court
		Strand, London WC2R 0ER
		United Kingdom
Nominated Advisor		Beaumont Cornish
		2nd Floor, Bowman House, 29 Wilson Street
		London EC2M 2SJ
		United Kingdom
Broker		Haywood Securities (UK) Limited
		Ryder Court
		14 Ryder Street
		London EC2R 7DE
		United Kingdom
Registrars		Computershare Investor Services (Channel Islands) Ltd
		PO Box 83
		Ordnance House, 31 Pier Road
		St Helier JE4 8PW
		Channel Islands
Principal bankers		CitiBank NA
		111 Wall Street
		New York United States of America

 

END

 

 

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