Interim Statement for period ended 30 June 2014

RNS Number : 8493R

Connemara Mining Company plc

17 September 2014

 



17 September 2014

Connemara Mining Company

Interim Statement for the period ended 30 June 2014

Connemara has continued to examine, select and apply for exploration acreage in Ireland.  This despite a private buyers strike on the AIM Market for junior exploration companies.  Lack of buying and investing interest makes funding very difficult even at very low prices.  One has to believe that investors at current prices will do very well when the cycle turns and explorers, once again, become fashionable.  A low share price, a reasonable balance sheet, good projects and an AIM listing underpin the investment case for shareholders in Connemara. 

Connemara does very well with limited resources.  Our two joint ventures with Teck, in Stonepark Limerick and Oldcastle, allows us to participate at minimal cost in big exploration programmes.  Teck has reduced zinc exploration in Ireland.  In Stonepark, Teck are spending €140,000 to refine what they know.  Connemara is contributing 23% towards this budget.  In the Oldcastle area, active geophysics and geochemical programmes have led to the identification of drill targets.  We are hoping that at least one hole will be drilled this year.  Teck have to spend a further €750,000 to earn a 75% interest - this before we have to contribute.

There are signs of activity in the gold sector in Ireland.  Dalradian have raised $20 million for trial mining in Tyrone.  Galantas are looking for funds to expand their small mine near Omagh.  Hendricks, our partner in Wicklow/Wexford, continues to do geophysics to better define drill targets.  Here too, we are hopeful of some drilling by year end.  Hendricks are spending €1 million on our ground to earn a 75% interest.  They have spent about €400,000.

We have been active in obtaining new ground.  The gold licences in Donegal looked good on paper but the results to date are not exciting.  We actively sought licences in the Lisheen/Galmoy zinc mines area.  We were awarded one.  This block is prospective for zinc.

We continue to review other opportunities as they become available. Recent proposals have not been pursued for differing reasons.  Connemara will raise fresh funds to cover overhead and essential working capital to keep the company operating. 

The cycle is slowly turning in our favour.  Zinc demand now exceeds supply thus putting pressure on zinc prices which are rising.  Investors are buying into producers or near producers.  The explorers turn is later in the cycle.  We are ready.

John Teeling

Chairman

17 September 2014

Connemara is a diversified exploration company with principal assets in base metal zinc/lead exploration licences as well as shear hosted gold exploration licences in Ireland.  The company holds interests in 29 licences covering an area of approximately 1,115 sq km.

This announcement has been reviewed and approved by the Company's technical director Graham Reid (P.Geo) in his capacity as the Qualified Person for the purposes of the AIM Guidance Note for Mining, Oil and Gas Companies issued by the London Stock Exchange.  Mr Reid is a Professional Member of The Institute of Geologists of Ireland (IGI) and The Society of Exploration Geophysicists (SEG) and has over 30 years' experience in mineral exploration and site investigation fields.

Enquiries:

Connemara Mining Company Plc
John Teeling, Chairman	[phone]
Jim Finn, Director
Westhouse Securities Limited
Martin Davison	[phone]
Robert Finlay
Blytheweigh	[phone]
Tim Blythe	[phone]
Halimah Hussain	[phone]
Camilla Horsfall	[phone]
Pembroke Communications
Natalie Tennyson	[phone]
Alan Tyrrell	[phone]

www.connemaramining.com

Connemara Mining Company plc
Financial Information (Unaudited)
						Six Months Ended				Year Ended
						30 June 14		30 June13		31 Dec 13
						unaudited		unaudited		audited
Condensed Consolidated Statement of Comprehensive Income						€'000		€'000		€'000
Continuing Operations
Administrative expenses						(141)		(191)		(349)
OPERATING LOSS						(141)		(191)		(349)
Investment revenue						1		1		1
LOSS BEFORE TAXATION						(140)		(190)		(348)
Income tax expense						-		-		-
LOSS FOR THE PERIOD AND TOTAL COMPREHENSIVE INCOME						(140)		(190)		(348)
LOSS PER SHARE - basic and diluted						(0.39c)		(0.64c)		(1.06c)
Condensed Consolidated Balance Sheet						30 June 14		30 June13		31 Dec 13
						unaudited		unaudited		audited
						€'000		€'000		€'000
NON-CURRENT ASSETS
Intangible Assets						2,328		2,273		2,290
CURRENT ASSETS
Other receivables						28		13		25
Cash and cash equivalents						37		409		65
						65		422		90
TOTAL ASSETS						2,393		2,695		2,380
LIABILITIES
CURRENT LIABILITIES
Trade and other payables						(333)		(337)		(180)
NET CURRENT (LIABILITIES)/ASSETS						(268)		85		(90)
NET ASSETS						2,060		2,358		2,200
EQUITY
Share Capital						357		357		357
Share Premium						4,525		4,525		4,525
Reserves						(2,822)		(2,524)		(2,682)
TOTAL EQUITY						2,060		2,358		2,200
Condensed Consolidated Statement of Changes in Shareholders Equity
		Called-up				Share Based
		Share		Share		Payment		Retained
		Capital		Premium		Reserves		Deficit		Total
		€'000		€'000		€'000		€'000		€'000
As at 1 January 2013		257		4,105		56		(2,390)		2,028
Shares issued		100		438						538
Share issue expenses				(18)						(18)
Options exercised						(6)		6		0
Loss for the period								(190)		(190)
As at 30 June 2012		357		4,525		50		(2,574)		2,358
Loss for the period								(158)		(158)
As at 31 December 2013		357		4,525		50		(2,732)		2,200
Loss for the period								(140)		(140)
As at 30 June 2014		357		4,525		50		(2,872)		2,060
						Six Months Ended				Year Ended
						30 June 14		30 June13		31 Dec 13
Condensed Consolidated Cash Flow						Unaudited		unaudited		audited
						€'000		€'000		€'000
CASH FLOW FROM OPERATING ACTIVITIES
Loss for the year						(140)		(190)		(348)
Investment revenue						(1)		(1)		(1)
Exchange movements						(1)		2		4
						(142)		(189)		(345)
Movements in working capital						150		(66)		(235)
CASH USED BY OPERATIONS						8		(255)		(580)
Investment revenue						1		1		1
NET CASH USED IN OPERATING ACTIVITIES						9		(254)		(579)
CASH FLOW FROM INVESTING ACTIVITIES
Payments for exploration and evaluation						(38)		(20)		(37)
NET CASH USED IN INVESTING ACTIVITIES						(38)		(20)		(37)
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from issue of equity shares						-		538		538
Share issue costs						-		(18)		(18)
NET CASH FROM FINANCING ACTIVITIES						-		520		520
NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS						(29)		246		(96)
Cash and Cash Equivalents at beginning of the period						65		165		165
Effects of exchange rate changes on cash held in foreign currencies						1		(2)		(4)
CASH AND CASH EQUIVALENTS AT END OF THE PERIOD						37		409		65

Notes:

1.     INFORMATION

The financial information for the six months ended June 30^th, 2014 and the comparative amounts for the June 30^th, 2013 are unaudited. The financial information above does not constitute full statutory accounts within the meaning of section 148 of the Companies Act 1963.

The interim financial report has been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the European Union. The accounting policies and methods of computation used in the preparation of the interim financial statements are consistent with those used in the Group 2013 Annual Report, which is available at www.connemaramining.com

The interim financial statements have not been audited or reviewed by the auditors of the Group pursuant to the Auditing Practices board guidance on Review of Interim Financial Information.

2.     No dividend is proposed in respect of the period.

3.     LOSS PER SHARE

	30 June 14		30 June 13		31 Dec 13
	€		€		€
Loss per share - Basic and Diluted	(0.39c)		(0.64c)		(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:
Loss for the year attributable to equity holders of the parent	(140,436)		(190,457)		(348,199)
Weighted average number of ordinary shares for the purpose of basic earnings per share	35,739,711		29,578,588		32,700,369

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

4.     INTANGIBLE ASSETS

	30 June 14		30 June 13		31 Dec 13
Exploration and evaluation assets:	€'000		€'000		€'000
Cost at 1 January	2,290		2,253		2,253
Additions	38		20		37
Closing Balance	2,328		2,273		2,290

               The above represents expenditure on projects in Ireland. Included in the Group intangible assets is €5,000 of directors' remuneration which was capitalised during the period.

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 the total 75% interest. As per the agreement the licences have been transferred into a new company, Oldcastle Zinc Limited, which at 30 June 2014 was owned 100% by Connemara Mining Company of Ireland Limited.

                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 30 June 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. As a result of the Group's decision not to meet cash calls in 2012, its interest in TILZ Minerals Limited was diluted from 25% to 23.79%.

               The realisation of the intangible asset is dependent on the 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 activities are subject to a number of significant 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 deferred development expenditure at 30 June 2014, the directors are satisfied that the value of the intangible asset is not less than carrying value.

 5.            SHARE CAPITAL AND SHARE PREMIUM

	30 June 14		30 June 13		31 Dec 13
	€'000		€'000		€'000
Authorised:
200,000,000 ordinary shares of €0.01 each	2,000		2,000		2,000
Allotted, Called Up and Fully Paid:	Number		Share Capital €'000		Share Premium €'000
Balance at 1 January 2013	25,709,711		257		4,105
Issued during period	10,030,000		100		438
Less share issue expenses	-		-		(18)
Balance at 30 June 2013	35,739,711		357		4,525
	-		-		-
Balance at 31 December 2013	35,739,711		357		4,525
	-		-		-
Balance at 30 June 2014	35,739,711		357		4,525

               On 8 April 2013, 1,000,000 options were exercised at a price of 1 cent per share.

               On 22 April 2013, 9,030,000 shares were issued at a price of 5p per share to provide additional working capital and fund development costs.

6.    The Interim Report for the six months to June 30^th 2014, was approved by the Directors on 16^th September 2014.

7.    Copies of the interim report will be sent to shareholders and will be available for inspection at the Companies Registered Office at 162 Clontarf Road, Dublin 3, Ireland. The Interim Report will also shortly be available for viewing on Connemara Mining Company Plc's website at www.connemaramining.com

 

END

 

 

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