Final Results for the Year Ended 31 December 2014

RNS Number : 9955O

Connemara Mining Company plc

03 June 2015

 

03^rd June 2015

Connemara Mining Company

("Connemara" or "the Company")

Final Results for the Year Ended 31 December 2014

Connemara Mining Company today announces its results for the year ending 31 December 2014.

Ends

Enquiries:

Connemara Mining Company Plc
John Teeling, Chairman	[phone]
Jim Finn, Director
Northland Capital Partners Limited
William Vandyk/Gerry Beaney	[phone]
John Howes/Mark Treharne (Broking)
Dowgate Capital Stockbrokers Limited
Jason Robertson	[phone]
Blytheweigh	[phone]
Tim Blythe	[phone]
Halimah Hussain	[phone]
Camilla Horsfall	[phone]
PSG Plus
Aoife Ross	[phone]
Alan Tyrrell	[phone]

www.connemaramining.com

Statement Accompanying the Final Results

Are there straws in the wind suggesting that the long term recession in junior mining shares may be ending?  Recent months has seen a pickup in volume on AIM in resource stocks, there is more M&A activity, world economies are growing and the media is more positive toward metal price trends particularly relating to base metal prices.  Zinc is selling above $2,300 a ton and rising.  I might simply be grasping at straws.  Funding for junior explorers is virtually non-existent.  Money can be raised but only at rock bottom discounted prices from short term bottom fishing investors looking for a short term return.  I see little or no interest from investors willing to hold on to shares while we pursue our long term exploration programmes.

Despite the appalling stock market environment, Connemara has been active in the period under review and during the first part of 2015.  We consolidated our licence position on gold in the Donegal region and added a zinc licence near the former Galmoy zinc mine.  We funded the company at the rock bottom share price of 2p only to see the price half on small volume.  In recent weeks the share price has recovered slightly but the company is capitalised at a fraction of the money spent on exploration.

The Connemara strategy is to get good ground, work up prospects and then find a partner to provide the funding and technology for more detailed and expensive exploration.

We have joint ventures with Teck of Canada, a world class base metal company and with Hendricks, a private Canadian group led by Dale Hendrick, a noted Canadian gold explorer. 

Teck, had initial success in Limerick but appear to have lost interest and now maintain the ground in good standing but only that.  A limited amount of work has been done by Teck on the Oldcastle block.  Teck hold a huge block of licences in the Irish midlands.  They appear to have a strategy covering the whole block rather than any specific focus on Oldcastle.  Teck appear to have a very limited exploration budget for Ireland so there will be limited work done in 2015.

Hendrick is also struggling with exploration budgets.  Earlier work identified drillable targets on our Wicklow/Wexford gold licences.  Drilling was promised for 2014 and again for 2015 but this is dependent on funding.

Connemara has continued to build up a portfolio of wholly owned licences.  While the focus has been on gold we did apply for three licences in the Galmoy region but obtained only one, the Rapla licence, in the competition.  This is good ground and we will develop a work programme for it.

Gold has been the bright star of Irish exploration in recent years.  The main success has been in Currinahault, Co. Tyrone where a Canadian company, Dalradian, has drilled an inferred gold resource of 3m ozs.  This, if it proves up and if planning approval and finance are obtained, could be a big mine in Tyrone.  Further south, extensive gold showings have been identified by Conroy Gold in Monaghan and Fermanagh.  In the Wicklow area, a number of companies have been exploring.  Apart from the Connemara ground, IMC and Hendricks have strong exploration results on their ground.  It is thought that a large Turkish gold producer, Kosa, has farmed in to the IMC ground.

Connemara has focussed on the Donegal area adjacent to Tyrone.  The geology is similar.  We obtained 10 licences in the Stranorlar area northeast of Currinahault.  We have soil sampled the ground with mixed results.

In early 2015 we were awarded 5 licences in the Inishowen area of Donegal.  The ground contains the former Glentogher lead/zinc/silver mine which functioned sporadically between 1790 and 1933.  The first part of a two part soil sampling programme is completed.  Initial results are positive showing good gold grades in boulders.

Future

We are financially secure.  The funds raised in 2014 are adequate for current plans and operations.  The business environment is looking better.  Zinc in particular has sound fundamentals with a supply shortages expected for the next few years.  Mines are not found in offices so on the ground exploration is needed.  We hope that Teck will either work the ground they have or pass it to another who will.  The Stonepark zinc discovery in Limerick lies metres from the very large Pallas Green zinc discovery owned by Glencore.

The expected entrance of Kosa into Irish gold exploration will bring fresh eyes as well as funding.  Hendrick intend to drill the Connemara ground in 2015 while the Donegal ground holds promise.

We have weathered many storms in the past few years.  The cycle turns.  We are well positioned.

John Teeling

Chairman

02^nd June 2015

__________________________________________________________________________________

CONNEMARA MINING COMPANY PLC

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014

	2014	2013
	€	€
CONTINUING OPERATIONS
Administrative expenses	(308,312)	(348,697)
OPERATING LOSS	(308,312)	(348,697)
Investment revenue	20	498
LOSS BEFORE TAXATION	(308,292)	(348,199)
Income tax expense	-	-
LOSS FOR THE FINANCIAL YEAR AND
TOTAL COMPREHENSIVE INCOME	(308,292)	(348,199)
Loss per share - basic and diluted	(0.74c)	(1.06c)

CONSOLIDATED BALANCE SHEET AS AT 31 DECEMBER 2014

	2014	2013
	€	€
ASSETS:
NON CURRENT ASSETS
Intangible assets	2,379,391	2,290,281
CURRENT ASSETS
Other receivables	69,398	25,272
Cash and cash equivalents	384,848	64,912
	454,246	90,184
TOTAL ASSETS	2,833,637	2,380,465
LIABILITIES:
CURRENT LIABILITIES
Trade and other payables	(457,372)	(180,513)
NET CURRENT LIABILITIES	(3,126)	(90,329)
NET ASSETS	2,376,265	2,199,952
EQUITY:
Called-up share capital	557,797	357,397
Share premium	4,809,006	4,524,801
Share based payment reserve	-	49,815
Retained deficit	(2,990,538)	(2,732,061)
TOTAL EQUITY	2,376,265	2,199,952

STATEMENT OF CHANGES IN EQUITY

FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014

Group and Company
	Called up Share Capital	Share Premium	Share Based Payment Reserve	Retained Deficit	Total
	€	€	€	€	€
At 1 January 2013	257,097	4,105,155	55,915	(2,389,962)	2,028,205
Shares issued	100,300	437,594			537,894
Share issue expenses		(17,948)			(17,948)
Options exercised	-	-	(6,100)	6,100	-
Loss for the financial year				(348,199)	(348,199)
At 31 December 2013	357,397	4,524,801	49,815	(2,732,061)	2,199,952
Shares issued	200,400	300,600			501,000
Share issue expenses Options expired		(16,395)	(49,815)	49,815	(16,395) -
Loss for the financial year				(308,292)	(308,292)
At 31 December 2014	557,797	4,809,006	-	(2,990,538)	2,376,265

Share premium

The share premium reserve comprises of the excess of monies received in respect of share capital over the nominal value of shares issued.

Share based payment reserve

The share based payment reserve arises on the grant of share options to directors and consultants under the share options plan.

Retained deficit

Retained deficit comprises accumulated losses in the current and prior financial years.

CONSOLIDATED CASH FLOW STATEMENT

FOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2014

	2014	2013
	€	€
CASH FLOW FROM OPERATING ACTIVITIES
Loss for the financial year	(308,292)	(348,199)
Investment revenue recognised in loss for the financial year	(20)	(498)
Exchange movements	(6,745)	4,539
	(315,057)	(344,158)
MOVEMENTS IN WORKING CAPITAL
Increase/(Decrease) in trade and other payables	266,859	(233,283)
Increase in other receivables	(44,126)	(1,846)
CASH USED BY OPERATIONS	(92,324)	(579,287)
Investment revenue	20	498
NET CASH USED IN OPERATING ACTIVITIES	(92,304)	(578,789)
CASH FLOW FROM INVESTING ACTIVITIES
Payments for exploration and evaluation	(79,110)	(36,962)
NET CASH USED IN INVESTING ACTIVITIES	(79,110)	(36,962)
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from issue of equity shares	501,000	537,894
Share issue costs	(16,395)	(17,948)
NET CASH FROM FINANCING ACTIVITIES	484,605	519,946
NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS	313,191	(95,805)
Cash and cash equivalents at beginning of financial year	64,912	165,256
Effect of exchange rate changes on cash held in foreign currencies	6,745	(4,539)
Cash and cash equivalents at end of financial year	384,848	64,912

Notes:

1.    Accounting Policies

There were no changes in accounting policies from those used to prepare the Group's Annual Report for financial year ended 31 December 2013.  The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union.

2.    Loss per Share                                                                                                                                 

	2014	2013
	€	€
Loss per share - Basic and Diluted	(0.74c)	(1.06c)

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:

	2014	2013
	€	€
Loss for the year attributable to equity holders of the parent	(308,292)	(348,199)
	2014	2013
	No.	No.
Weighted average number of ordinary shares for the
purpose of basic earnings per share	41,504,643	32,700,369

Basic and diluted loss per share is the same as the effect of the outstanding share options and warrants is anti-dilutive.

3.    Intangible Assets

	2014	2013
Exploration and Evaluation:	€	€
Cost:
At 1 January 2013	2,290,281	2,253,319
Additions	89,110	36,962
At 31 December 2013	2,379,391	2,290,281
Carrying amount:
At 31 December 2013	2,379,391	2,290,281

The above represents expenditure on projects in Ireland. Included in the Group intangible assets is €10,000 (2013: €10,000) of directors' remuneration which was capitalised during the financial year.

In 2012 the Group entered into an agreement with Teck Ireland Limited ("Teck"), a subsidiary of Teck Resources Limited, which gives Teck the option of earning a 75% interest in licences held by the Group in Cavan/Meath. Teck have to spend €1.35 million on the licences by 2018 in order to earn the option to acquire 75% interest. As per the agreement the licences were transferred into a new company, Oldcastle Zinc Limited. As at 31 December 2014 Teck had completed €550,000 worth of expenditure. As per the agreement upon Teck completing €550,000 of expenditure 343,500 ordinary shares in Oldcastle Zinc Limited were to be issued to Teck. The shares were issued on 20 February 2015 giving Teck a 51% interest in the company.

In 2007 the Group entered into an agreement with Teck Cominco which gave Teck Cominco the option to earn a 75% interest in a number of other licences held by the Group.  Teck Cominco had to spend CAD$3m to earn the interest. During 2012 the relevant licences were transferred to a new company, TILZ Minerals Limited, which at 31 December 2014 was owned 23.79% (2013: 23.79%) by Limerick Zinc Limited and 76.21% (2013: 76.21%) by Teck Ireland Limited.                  The Group's share of expenditure on the licences continues to be capitalised as an exploration and evaluation asset. The Group is subject to cash calls from Teck Ireland Limited in respect of the financing of the ongoing exploration and evaluation of these licences. In the event that the Group decides not to meet these cash calls its interest in TILZ Minerals Limited may be diluted accordingly.

The realisation of the intangible assets is dependent on the discovery and successful development of economic reserves which is subject to a number of risks as outlined below.  Should this prove unsuccessful the value included in the balance sheet would be written off to the statement of comprehensive income.

The Group's exploration activities are subject to a number of significant and potential risks including:

               - uncertainties over development and operational risks;

               - compliance with licence obligations;

               - liquidity risks; and

               - going concern risks;

The directors are aware that by its nature there is an inherent uncertainty in such exploration and evaluation expenditure as to the value of the asset.  Having reviewed the carrying value of exploration and evaluation of assets at 31 December 2014, the directors are satisfied that the value of the intangible asset is not less than carrying value.

Segmental analysis	2014	2013
	€	€
Limerick	1,358,347	1,326,447
Oldcastle	330,000	330,000
Rest of Ireland	691,044	633,834
	2,379,391	2,290,281

4.    Share Capital and Share Premium

	2014	2013
	€	€
Authorised:
200,000,000 Ordinary shares of €0.01 each	2,000,000	2,000,000

Allotted, Called-Up and Fully Paid:

		Share	Share
	Number	Capital	Premium
		€	€
At 1 January 2013	25,709,711	257,097	4,105,155
Issued during the financial year	10,030,000	100,300	437,594
Share issue costs	-	-	(17,948)
31 December 2013	35,739,711	357,397	4,524,801
At 1 January 2014	35,739,711	357,397	4,524,801
Issued during the financial year	20,040,000	200,400	300,600
Share issue costs	-	-	(16,395)
31 December 2014	55,779,711	557,797	4,809,006

On 18 September 2014, a total of 20,040,000 shares were issued at a price of 2p per share to provide additional working capital and fund development costs. 

5.    Annual General  Meeting

The Company's Annual General Meeting will be held on 6^th July 2015 in 162 Clontarf Road, Clontarf, Dublin 3 at 11:00 am.

6.    General Information

The financial information set out above does not constitute the Company's financial statements for the year ended 31 December 2014.  The financial information for 2013 is derived from the financial statements for 2013 which have been delivered to the Companies Registration Office.  The auditors have reported on 2013 statements; their report was unqualified with an emphasis of matter in respect of considering the adequacy of the disclosures made in the financial statements concerning the valuation of intangible assets, investment in subsidiaries and amounts due by group undertakings. The financial statements for 2014 will be delivered to the Companies Registration Office.

A copy of the Company's Annual Report and Accounts for 2014 will be mailed to all shareholders shortly and will also be available for collection from the Company's registered office, 162 Clontarf Road, Dublin 3, Ireland.  The annual report will shortly be available for viewing at Connemara Mining Company PLC's website at www.connemaramining.com.             

 

END

 

 

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