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Arcon Int.Resources (AIN)

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Friday 18 March, 2005

Arcon Int.Resources

Premlinary Results

Arcon International Resources PLC
18 March 2005



Preliminary Results for the year ended 31 December 2004

18th March, 2005 - The Board of ARCON International Resources Plc ('ARCON') is
pleased to announce its unaudited Preliminary Results for the year ended 31
December, 2004, reporting:

•   A 31% increase in concentrate sold from 120,421 dmt in 2003 to 157,862
    dmt in 2004, comprising 133,148 dmt zinc concentrate and 24,714 dmt lead
    concentrate, benefiting from the upgrading of the lead circuit in May 2004.

•   Final planning permission to develop and mine the high grade 'R' zone
    orebody received.

•   New annual royalty rates of 1.25%(turnover less transport costs) from
    March 2001 to June 2006 and 1.75% thereafter agreed with Irish Government.

•   A 67% increase in turnover to €37.3 million.

•   EBITDA of €7 million compared to an EBITDA loss of €4.5 million in 2003.

•   Profit of €1.4 million compared to a loss of €9.7 million in 2003.

Commenting on the year end results this morning ARCON's Chief Executive, Peter
Kidney, said 'ARCON has continued to make further progress and is pleased to
report a net profit of €1.4 million for the year'.

The improvement in ARCON's results has occurred despite a number of once off
operational issues at the mine which curtailed short term production.
Fortunately by year end these issues had been satisfactorily resolved.

The average LME zinc price during the year was $1,044 ($828 - 2003) a rise of
26.5%, the impact of which was reduced by a further weakening of the US$/€
exchange rate from $1.13/€ to $1.24/€ with a consequential change in the average
Euro equivalent LME zinc price to €842/mt (2004) compared to €732/mt (2003).

Strong demand for zinc began to impact zinc prices in 2005 with a rise in the
LME zinc price to an excess of $1,400 mt recently. A shortage of zinc
concentrate on world markets is expected to result in a further reduction in
zinc treatment charges in 2005 and 2006.

ARCON is continuing to focus on further improvements in production volumes at
Galmoy while at the same time continuing with its exploration programme in the
Galmoy area with a view to extending the Galmoy mine life beyond 2010.
On 3rd March 2005, the Company announced that it had received an approach from
Lundin Mining to the effect that Lundin intended to make a merger offer to the
Company.

This matter is being actively considered by the Independent Directors of the
Company who will advise shareholders of their recommendation as soon as
possible.


Consolidated profit and loss account
for the year ended 31 December 2004
                                                 2004             2003
                                                €'000            €'000

Gross value of metal sold                      69,888           45,470
Smelting charges and deductions               (32,558)         (23,115)
                                               ______           ______

Turnover                                       37,330           22,355
                                               ______           ______

Production costs                              (23,525)         (21,440)
Depreciation                                   (4,193)          (4,121)
                                              _______          _______
Cost of sales                                 (27,718)         (25,561)
                                               ______           ______
Gross profit/(loss)                             9,612           (3,206)
Operating expenses                             (6,698)          (5,201)
Mineral exploration costs                        (146)            (230)
                                               ______          _______
Operating profit/(loss)                         2,768           (8,637)

Interest receivable and similar income            102               52
Interest payable and similar charges           (1,430)          (1,097)
                                              _______         ________

Profit/(loss) on ordinary activities            1,440           (9,682)
before taxation
Tax on Profit/(loss) on ordinary                    -                -
activities

Retained profit/(loss) for the year             1,440           (9,682)

Profit and loss account, at beginning        (105,147)         (95,465)
of year
                                               ______          _______

Profit and loss account, at end of           (103,707)        (105,147)
year                                        ==========       ==========
                                              

Profit/(loss) Per Ordinary Share,              €0.008           €(0.06)
basic and diluted                             ========        =========



     Balance Sheets at           
     31 December
                                   Group                         Company
                               2004            2003         2004           2003
                              €'000           €'000        €'000          €'000
     Fixed assets
     Mineral interests       17,774          19,251          361            354
     Tangible assets          9,077           8,767           11             21
     Financial assets           -               -         48,034         47,985
                            _____          ______         ______         ______
                           26,851          28,018         48,406         48,360
                           ______          ______         ______         ______
                         
     Current assets
     Stocks                1,762             930                             -
     Debtors               1,467           1,531             83             59
     Cash at bank
     and in hand           4,028           3,880            335          1,241
                          ______          ______         ______         ______
                           7,257           6,341            418          1,300
     Creditors:
     Amounts falling
     due within
     one year            (15,348)        (14,457)        (1,099)        (1,440)
                           _____          ______         ______         ______
                           
     Net current
     liabilities          (8,091)         (8,116)          (681)          (140)
                          ______          ______         ______         ______
                          
     Total assets
     less current
     liabilities          18,760          19,902         47,725         48,220

     Creditors:
     Amounts falling
     due after more  
     than one year        (6,669)         (8,912)       (14,346)       (14,336)

     Provision for
     liabilities
     and charges          (5,196)         (4,556)             -              -
                          ______          ______         ______         ______
                          
     Net assets            6,895           6,434         33,379         33,884
                           =======         =======      ========       ========
                    
     Capital and reserves
     Called up share 
     capital              31,770          31,770         31,770         31,770
     
     Capital
     conversion reserve    1,002           1,002          1,002          1,002

     Share premium        81,359          81,359         81,232         81,232
  
     Profit and
     loss account       (103,707)       (105,147)       (80,625)       (80,120)
     Foreign
     currency translation
     reserve              (3,529)         (2,550)             -              -
                          ______          ______         ______         ______
     Shareholders'
     funds - equity        6,895           6,434         33,379         33,884
                          =======         =======       ========        =======
                    


Consolidated cash flow statement
for the year ended 31 December 2004

                                                  2004            2003
                                                 €'000           €'000

Net cash inflow/(outflow) from                   5,428          (3,088)
operating activities

Returns on investments and servicing of
finance
Interest received                                   79              26
Interest paid                                     (563)            (73)
                                               _______         _______
                                                  (484)            (47)
                                                ______          ______
Taxation                                             -
                                                ______         _______

Capital expenditure and financial investment
Expenditure on mineral interests                (1,379)         (2,742)
Purchase of tangible fixed assets               (2,711)         (1,290)
Cash paid for restoration costs                    (68)            (81)
Sale of assets                                      97
                                               _______         _______
                                                (4,061)         (4,113)
                                               _______         _______

Net cash inflow/(outflow) before use of
liquid resources and financing                    883          (7,248)

                                               _______         _______

Financing
Proceeds from issue of share capital,net             -           5,332

Finance lease payments                            (529)           (478)
Fairfield Facility                                (206)          4,457
                                                _______         _______
                                                  (735)          9,311

Increase in cash in the year                       148           2,063
                                                =======         =======
                                                                                                              
Notes

       1.The attached financial statements for the year ended 31 December, 2004
         were reviewed by the Directors on 16 March, 2005. There have been no
         changes in accounting policy during the year.

       2.Profit (loss) per ordinary share has been restated for the share
         consolidation effected in August 2004.

For further information

Peter Kidney
ARCON
+353 (1) 667 3063

Pauline McAlester
Murray Consultants
+353 (1) 498 0300

Keith Irons
Bankside Consultants Ltd
+44 (207) 444 4155




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