Geiger Counter Ltd : Annual Financial Report

GEIGER COUNTER LIMITED

Date of Announcement: 17/12/2013

RELEASE OF ANNUAL REPORT AND FINANCIAL STATEMENTS

The Directors announce the release of the Annual Report and Financial Statements for the year ended 30 September 2013.

CHAIRMAN'S STATEMENT - FOR THE YEAR ENDED 30 SEPTEMBER 2013

General outlook

There is a growing belief that had Fukushima happened in any other country than Japan, a much more positive commentary would have emerged from the event. Consider the facts:-

1. Age of reactors involved - Forty two years
2. Number of fatalities - nil
3. Cases of people affected by serious radioactivity - nil

To understand why the operators of the nuclear reactors, Tokyo Electric Power, have not adopted a more positive approach, it is necessary to understand something of the Japanese psyche. Although the events were brought about by one of the worst tsunamis in history; the company adopted a typically honourable Japanese stance and accepted responsibility for this disaster. To a certain extent this was correct insofar that the reactor might well have been de-commissioned by that time. Modern technology decrees that the current design of reactors has made them hugely more efficient and capable of resisting extreme weather conditions. I have no doubt that given the lack of environmentally acceptable alternative sources of energy, it is only a matter of time before a new strategy for nuclear power will be implemented led by the Government of Japan.

In the meantime, the markets for both the commodity and the relevant shares, remain subdued. In spite of China continuing to expand its nuclear capacity and even the UK embarking on a new policy, sentiment remains less than positive. It would appear that the spot price for Uranium has bottomed at around the US$35 per pound level but until it shows definitive signs of appreciation, share prices will remain around the current low levels. Although my observations might be interpreted as somewhat cautious, I am, in fact, an unrequited bull. In the long term I have no doubt that countries other than China eg Argentina, South Africa, Finland and Saudi Arabia will adopt a similar policy embracing the fact that modern technology had made the sector an integral part of safe and competitive energy.

Revision of Fees

The Board is only too conscious that the market capitalisation of the Fund has fallen considerably over the last two years and following consultation with the investment manager agreement has been reached to reduce the management fee from 2 percent to 1.375 percent effective from 1 January 2014.

The Board has also agreed that as from the same date our Directors' fees will be reduced by 20 percent as a contribution towards reducing the total expense ratio.

Continuation Vote

At the forthcoming Annual General Meeting expected to be held in March 2014 shareholders will be given the opportunity to vote on the continuation of the Company. Although the following year will continue to be a challenge the Board will be recommending that shareholders vote in favour of the continuation resolution as the underlying fundamentals remain attractive in the medium to long-term.

Finally..I would like to thank the Company shareholders for their continued support, my fellow Directors for their diligence and our advisers for their advice and guidance over the last year.

George Baird
Chairman
December 2013

INVESTMENT ADVISER'S REPORT - FOR THE YEAR ENDED 30 SEPTEMBER 2013

The spot price of uranium appeared to be bucking the trend of a depressed resources market by holding the $40 per lb level for most of the year. In July however it fell to a seven year low as the delays in restarting the Japanese nuclear fleet weighed on market sentiment. We do not believe that this price is sustainable over the long term as this is below the cost of production for many existing mines and certainly below the level required to incentivise new mines to be built or to be profitable.

Uranium equities followed the spot price lower and were also caught up in the general resources malaise, particularly the smaller exploration companies. It was encouraging, however, to watch the market's reaction to the Patterson Lake South discovery and the performance of both owners, Alpha Minerals and Fission Uranium. Despite the falling market, Fission more than doubled and Alpha rose more than 1500% over the year. This is fast becoming a tier one deposit and the recent history would suggest that it may well end up in the hands of the majors. The strategic players have displayed a much more positive view of the Uranium market post Fukishima with Mantra Resources, Extract Resources, Kalahari Minerals and Hathor Exploration all falling to bids from the larger producers. This trend continued this year when Uranium One was acquired by a subsidiary of Rosatom, the Russian parastatal. Such deals will also be helped by the recent change in legislation that now allows foreigners to own producing uranium mines within Canada.

Two and a half years on, the shadow of Fukishima lingers over the nuclear industry and it does need a leader to forcibly present its case as the low cost, reliable, carbon neutral and safe source of base load power.

Recent announcements regarding the UK's nuclear future are positive, and we are very mindful of the focus on air quality by the new regime in China for the nuclear build within that country.

We believe that the nuclear industry has an important place in the energy mix going forward and that a higher price of uranium is required to produce the necessary supply. With uranium equities shunned by investors and trading at compressed valuations, any upward move in the spot price could be amplified as interest returns.

Will Smith
New City Investment Managers
December 2013

For further information, please contact:

Lisa Neil        Roddy Watt       
Geiger Counter Limited   Threadneedle Communications
Telephone number: [phone]        Telephone number: [phone]
Email: [e-mail]         Email: [e-mail]

Geiger Counter Ltd Annual Report 30.09.2013

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The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Geiger Counter Ltd via Globenewswire

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