RNS Number : 2665N
Ormonde Mining PLC
27 September 2012
27 September 2012
Ormonde Mining plc
("Ormonde" or "the Company")
Interim Results for the Six Months Ended 30 June 2012
Ormonde Mining plc, the development and exploration company operating in Spain, is pleased to announce its unaudited interim results for the six months ended 30 June 2012.
Highlights:
Barruecopardo
· Definitive Feasibility Study completed demonstrating exceptional economics
· Final Permitting documentation submitted
· Capital funding negotiations with selected parties ongoing and expected to be completed in coming months
Exploration
· Antofagasta JV drilling on new permits completed and being assessed
· Aurum Mining JV drilling at the El Facho and Peralonso Prospects delivered encouraging results; further drilling now underway at Peralonso
Michael Donoghue, Chairman of Ormonde, commented,
"Throughout 2012, we have been putting in place the essential building blocks to enable the transformation of the Company to take place next year with development of our flagship Barruecopardo Tungsten Project, Spain. Following completion of the Definitive Feasibility Study and submission of documentation for Final Permitting, we have moved to advance capital funding arrangements and are currently in discussions with selected parties. These discussions are progressing and on completion in the coming months will pave the way for the development plan to be implemented at Barruecopardo in 2013."
Enquiries to:
Ormonde Mining plc
Kerr Anderson, Managing Director Tel: +353 (0)1 8253570
Bankside Consultants
Simon Rothschild Tel: +44 (0)20 7367 8888 Mob: +44 (0)7703 167065
Murray Consultants
Ed Micheau Tel: +353 (0)1 4980300 Mob: +353 (0)86 803 7155
Davy (Nomad / ESM Adviser)
Eugenée Mulhern / Roland French Tel: +353 (0)1 6796363
Fairfax I.S. PLC (Joint Broker)
Ewan Leggat / Katy Birkin Tel: +44 (0)207 598 5368
CHAIRMAN'S STATEMENT
Progress on the advancement of our Barruecopardo Tungsten Project in Salamanca Province, Spain, towards development and production continued during the first half of 2012. Completion of the Definitive Feasibility Study in Q1 led to the submission of the second and final permitting documentation and facilitated the commencement of a formal phase of capital funding and offtake negotiations. Meanwhile our copper exploration endeavours in joint venture with Antofagasta Minerals in the Andalucía Province and our gold exploration in joint venture with Aurum Mining in the Salamanca and Zamora Provinces continued to make progress, with the latter leading to the discovery of a new and most encouraging zone of gold mineralisation at the Peralonso Prospect in the Salamanca Province.
The Definitive Feasibility Study for Barruecopardo, based upon an averaged 227,000 metric tonne units of tungsten trioxide (WO3) production per year from a nine year open pit operation, confirmed both the technical viability and very strong economics of this major tungsten project, delivering a pre-tax NPV (8% discount rate) of €120M, averaged annual pre-tax net operating cash flows of €29M and an IRR of 52.0% at an APT price of US$350/mtu.
During Q2 the final documentation for the permitting process at Barruecopardo was compiled in conjunction with our Spanish consultants. This led to the submission in July 2012 of a number of detailed reports: the Environmental Impact Study, the Exploitation Plan, the Restoration Plan and the Financial Plan, to the Mining Department in Salamanca, and these documents are now being reviewed to ensure they meet all regulatory requirements to enable the granting of a Mining Concession. The first stage submission (the Documento Inicial) was presented in January 2011 and was reviewed and processed by the regional authorities in a timely manner. We have worked closely with the various regulatory bodies since that initial submission and have taken their views and recommendations into account in our final submission.
Work on the pre-EPCM engineering design also commenced during the period. This comprised testing on bulk samples to finalise the design and equipment selection for both the comminution and gravity circuits and to enable equipment performance guarantees to be provided by appropriate suppliers. This work is essentially complete with the detailed engineering work to follow.
Completion of the various technical studies facilitated an emphasis being placed on the capital funding, offtake and detailed engineering stages. Negotiations with selected parties in relation to capital funding are advancing, as are external economic and technical evaluations. Negotiations on offtake are also in process but as a matter of strategy offtake arrangements will only be concluded in tandem with or following the finalisation of the capital funding package. We now expect these funding activities to run to completion in the coming months as we seek to maintain flexibility to ensure the optimum funding package for the Project.
In parallel with this technical work, the strong relationship developed with the Barruecopardo Municipality was formally recognised through a Collaboration Agreement signed with the local Council in July 2012, which included a commitment by Ormonde to provide an annual contribution towards the activities of the Council. These funds will be allocated by the Council to areas which benefit the local community.
Tungsten prices softened somewhat during the period as a response to some uncertainty in the short term outlook for the global economy. Nevertheless, the outlook for tungsten remains very positive, with end-users interested in establishing a strategic and secure long-term supply in a situation where new mine developments remain constrained and supply of tungsten as APT is forecast to contract (as did the tungsten concentrate supply previously) as China continues to develop and move downstream into tungsten product manufacturing.
Elsewhere, exploration activity in the joint venture with Antofagasta on the new permits awarded in 2011 continued, with 3,048 metres of drilling recently completed on several targets as a follow-up to a ground gravity survey and an airborne electro-magnetic survey. This programme was funded by Antofagasta and data is now being assessed by them. Further announcements in relation to the outcome of this programme will be made in due course.
Ormonde's gold exploration activities in Zamora and Salamanca Provinces generated encouraging results during the period. This work was fully funded as part of an earn-in joint venture with Aurum Mining Plc, with Ormonde acting as Manager. Drilling on the El Facho Prospect in Zamora established continuity of the gold mineralised zone over a strike length of some 600 metres and enabled a preliminary non-compliant resource estimate of some 120-145k ounces of gold at average grades of around 1g/t gold. The first drilling on the Peralonso Prospect in the Salamanca Province yielded very encouraging results with broad zones of potentially economic mineralisation encountered in one of the holes and this Prospect has become a priority target with further drilling now underway.
Ormonde incurred an operating loss for the period of €499k (€445k for the 6 months to June 2011), which reflects a continued control of administrative expenses. The Company raised £3.4 million (before expenses) through a placement at the beginning of March, to progress work at Barruecopardo and for general working capital purposes.
In concluding I would like to thank shareholders for their support during the period. I look forward to finalising arrangements for the development of our Barruecopardo Project in the period ahead.
Michael J. Donoghue
Chairman
27 September 2012
Ormonde Mining PLC
Consolidated Statement of Comprehensive Income
Six months ended 30 June 2012
unaudited
unaudited
audited
6 months ended
6 months ended
Year ended
30-Jun-12
30-Jun-11
31-Dec-11
€000s
€000s
€000s
Turnover
0
0
0
Administration expenses
(499)
(445)
(981)
________
________
________
Operating loss
(499)
(445)
(981)
Interest receivable
13
8
15
______
______
______
Loss on Ordinary Activities
(486)
(437)
(966)
Minority Interest
0
0
0
______
______
______
Loss for the Period
(486)
(437)
(966)
Loss per share
Basic loss per share
-€0.0014
-€0.0014
-€0.0030
Diluted loss per share
-€0.0013
-€0.0014
-€0.0029
Ormonde Mining PLC
Consolidated Statement of Financial Position
As at 30 June 2012
Total equity - attributable to the owners of the Company
21,198
18,242
17,826
Current liabilities
Trade & other payables
729
369
1,358
_______
_______
_______
Total liabilities
729
369
1,358
_______
_______
_______
Total equity & liabilities
21,927
18,611
19,184
_______
_______
_______
Ormonde Mining PLC
Consolidated Statement of Cashflows
Six months ended 30 June 2012
unaudited
unaudited
audited
6 months ended
6 months ended
Year ended
30-Jun-12
30-Jun-11
31-Dec-11
€000s
€000s
€000s
Cashflows from operating activities
Net loss for period before interest & tax
(486)
(436)
(967)
Adjustments for:
Depreciation
1
4
3
Movement on Share-based payment reserve
0
0
114
Investment income recognised in P&L
0
(1)
(15)
________
________
________
(485)
(433)
(865)
Movement in Working Capital
(Increase) in receivables
158
(363)
(277)
Increase/(decrease) in liabilities
(629)
96
1,087
Income taxes paid
0
0
(1)
________
________
________
Net Cash (used in) operations
(956)
(700)
(56)
Cashflows from financing activities
Proceeds from issue of share capital
3,858
4,394
4,394
Investing activities
Movement in plant & equipment
(1)
0
14
Expenditure on intangible assets
(1,364)
(1,752)
(4,321)
Interest received
0
(1)
15
________
________
________
Net cash used in investing activities
(1,365)
(1,753)
(4,292)
________
________
________
Net increase in cash and cash equivalents
1,536
1,941
46
Cash and cash equivalents at beginning of period
1,990
1,944
1,944
______
______
______
Cash and cash equivalents at end of period
3,526
3,885
1,990
Ormonde Mining PLC
Consolidated Statement of Changes in Equity
Share based payment reserve
Share Capital
Share Premium
Other Reserves
Retained Losses
Total
€000s
€000s
€000s
€000s
€000s
€000s
At 1 January 2011
9,042
20,889
663
37
(16,346)
14,285
Proceeds of share issue
1,109
3,285
-
-
-
4,394
Loss for the period
-
-
-
-
(437)
(437)
______
______
______
______
_______
______
At 30 June 2011
10,151
24,174
663
37
(16,783)
18,242
Proceeds of share issue
-
-
-
-
-
0
Recognition of share based payments
-
-
114
-
-
114
Loss for the period
-
-
-
-
(529)
(529)
______
______
______
______
_______
______
At 31 December 2011
10,151
24,174
777
37
(17,312)
17,827
Proceeds of share issue
847
3,011
-
-
0
3,858
Recognition of share based payments
-
-
-
-
-
0
Loss for the period
-
-
-
-
(486)
(486)
______
______
______
______
_______
______
At 30 June 2012
10,998
27,185
777
37
(17,798)
21,199
______
______
______
______
_______
______
Notes to the Interim Financial Statements
1. Segmental Analysis
The Group is engaged in one business segment only, exploration of mineral resource projects. Therefore only an analysis by geographical segment has been presented. The Group has geographic segments in Ireland and Spain.
The segment results for the period ended 30th June 2012 are as follows:
Ireland
Spain
Loss for 6 months to 30 June 12
€000s
€000s
Segment loss for period
0
(486)
______
______
0
(486)
______
______
2. Loss per share
The basic and weighted average number of ordinary shares used in the calculation of basic earnings per share are as follows:
Loss per share
30-Jun-12
30-Jun-11
31-Dec-11
€000s
€000s
€000s
Loss for period
(486)
(437)
(966)
Weighted average number of ordinary shares
for the purpose of basic earnings per share
359,604,555
308,642,582
324,122,481
______
______
______
Basic loss per ordinary shares (in cent)
(0.14)
(0.14)
(0.30)
______
______
______
Diluted earnings per share
The weighted average number of ordinary shares used in the calculation of diluted earnings per share are as follows:
Loss per share
30-Jun-12
30-Jun-11
31-Dec-11
€000s
€000s
€000s
Loss for period
(486)
(437)
(966)
Weighted average number of ordinary shares
for the purpose of basic earnings per share
359,604,555
308,642,582
324,122,481
Shares deemed to be issued for no consideration
in respect of Employee Options
6,356,175
2,704,688
6,957,464
Weighted average number of ordinary shares
for the purpose of diluted earnings per share
365,960,730
311,347,270
331,079,945
______
______
______
Diluted loss per ordinary shares (in cent)
(0.13)
(0.14)
(0.29)
______
______
______
Notes to the Interim Financial Statements (continued)
3. Intangible assets - Exploration costs
Exploration
Total
& Evaluation
Assets
€000s
€000s
Cost
At 1 January 2012
16,764
16,764
Additions
1,364
1,364
______
______
At 30 June 2012
18,128
18,128
______
______
4. Property, Plant and Equipment
Fixtures
Computer
Motor
Total
& Fittings
Equipment
Vehicles
€000s
€000s
€000s
€000s
Cost
At 1 January 2012
26
45
18
89
Additions
1
0
0
1
Disposals
(2)
(19)
0
(21)
_____
_____
_____
_____
At 30 June 2012
25
26
18
69
_____
_____
_____
_____
Accumulated Depreciation & Impairment
At 1 January 2012
(23)
(44)
(18)
(85)
Depreciation expense
(1)
0
0
(1)
Disposals
2
19
0
21
_____
_____
_____
_____
At 30 June 2012
(22)
(25)
(18)
(65)
_____
_____
_____
_____
Net Book Value at 1 January 2012
3
1
0
4
_____
_____
_____
_____
Net Book Value at 30 June 2012
3
1
0
4
_____
_____
_____
_____
Notes to the Interim Financial Statements (continued)
5. Share Capital
Share Capital
30-Jun-12
30-Jun-11
31-Dec-11
€000s
€000s
€000s
Authorised Equity
450,000,000 ordinary shares of 2.5c each
11,250
11,250
11,250
100,000,000 deferred shares of 3.809214c each
3,809
3,809
3,809
______
______
______
15,059
15,059
15,059
______
______
______
Issued Capital
Share Capital
10,998
10,151
10,151
Share Premium
27,185
24,174
24,174
______
______
______
38,183
34,325
34,325
______
______
______
On 12 March 2012, the Company placed 33,910,896 new ordinary shares of nominal value of €0.025 each in the capital of the Company at a price of Stg10p per share, raising in aggregate Stg£3.39 million (approximately €4.04 million) before expenses.
The financial information has been prepared under International Financial Reporting Standards using accounting policies consistent with those in the last Annual Report.
No dividends were paid or proposed in respect of the six months ended 30 June 2012.
ENDS
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