RNS Number:9635M
Glencar Mining PLC
30 June 2003
GLENCAR MINING PLC
PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2002
The 2002 Annual Report to shareholders and the annual and extraordinary general
meetings expected to be convened shortly will mark the beginning of a new
chapter in the Company's development. Since February 2001, we have been fully
engaged in the disposal of the Wassa Project and the conclusion of the
associated agreements with the lenders to the Wassa Project which will enable
Glencar to achieve debt-free status. The agreements with all of the lenders and
with Standard Bank London Limited as Convertible Loan Note Holder have all now
been finalised, and are expected to be signed shortly. These agreements,
together with the proposed new equity financing outlined below, will secure the
release of the parent company guarantee given by Glencar to the lenders to the
Wassa Project and the waiver by Standard Bank of payment due to them under the
Convertible Loan Note. Glencar will then have no debt. On completion, Standard
Bank London Limited and CDC Group plc will each own 12 million ordinary shares
in Glencar, representing approximately 8% of the enlarged issued equity in
Glencar. In addition, CDC Group plc will be granted 7.5 million warrants to
subscribe for new shares in Glencar for a three year period at an exercise price
of Euro 0.031 per share.
Although the finalisation of these agreements has been an arduous and time
consuming process with many competing and sometimes conflicting interests, we
have now secured for Glencar the opportunity to progress its interests, but in a
much more favourable market and gold price environment and with the benefit of
our extensive and successful exploration record for gold in Africa. This record
includes the discovery of two major gold deposits. In 1986, in the very early
years of the revival of Ghana's gold mining industry, Glencar discovered the
Teberebie deposit. This deposit was subsequently developed into the largest
producing gold mine in Africa outside South Africa, a mine which is still in
production today. The Wassa deposit was discovered in 1994 and with current gold
prices would have been successful for Glencar. We anticipate that Wassa will
soon be brought back to production by its new owners using more advanced
processing technology than the heap leach process we were operating.
For the future, we intend to concentrate on our strengths and to focus on the
discovery of new gold deposits in Africa, initially with our very strong
projects in Ghana, Mali and Uganda.
The Asheba Project in Ghana presents a very significant target with recent work
there identifying a new mineralized zone which will be tested soon by drilling.
In Mali we have recently acquired an exclusive option to acquire up to an 85%
interest in approximately 1,000 km2 of exploration licence, on Mali's border
with Guinea. This ground was previously held by BHP and Randgold Resources as
part of their regional exploration programmes in the mid 1990's and is a very
attractive area geologically, where extensive artisanal mining is taking place.
Randgold did detailed follow up work on just a few of the prospects highlighted
by the reconnaissance programme. The most advanced prospect on the property is
the Komana 2 prospect where a resource of some 280,000 ounces of gold has
already been delineated by the previous operators. We believe that there is an
excellent opportunity for Glencar to utilise the extensive existing database to
follow up the earlier exploration carried out by Randgold, and to engage in
detailed evaluation and drilling of the many targets which exist on the
property.
The prospecting licences in southeastern Uganda occur within the very prolific
Lake Victoria Greenstone terrain which hosts some very large and profitable gold
deposits further to the south in Tanzania.
An Extraordinary General Meeting, expected to be convened together with the
Annual General Meeting in the coming weeks, will consider resolutions relating
to our proposed financing arrangements for these exploration projects and
relating to the completion of the agreements with the lenders to the Wassa
Project and with Standard Bank London Limited. We are at an advanced stage of
discussions relating to a private placing of new shares to raise up to US$1
million in new funds to carry out the Company's planned exploration programmes
over the next twelve to eighteen months, during which time we expect to conclude
a drilling programme at the Asheba Project in Ghana and to have advanced both
the Mali and Uganda projects to the drilling stage. Documentation relating to
the placing is currently being drafted and will be circulated to shareholders
shortly.
We are very pleased to have been able to return the Company to the position
where it can look to the future with some confidence. Subject to shareholder
approvals, and the successful completion of the proposed private placing, we
will be adequately financed to progress the exploration on our properties in
Africa, where we expect some early success from the Asheba Project in
particular. Our existing institutional shareholder base, together with our
prospective new shareholders, Standard Bank London Limited and CDC Group plc,
provides a very strong foundation for successful growth for Glencar in the gold
exploration business in Africa.
We are very pleased to be able to forecast a positive future for Glencar. We are
also very grateful for the assistance and patience shown by all of those,
lenders, contractors, shareholders and others, who have played a part in helping
us to achieve this objective. We are determined to restore value to the Company
and its shares. We are very positive about the exploration potential of our
existing projects and we will continue to evaluate potential new projects which
can meet our exploration criteria.
I would like to thank my fellow Board members for their support and assistance
during the very difficult years we have recently experienced.
Hugh McCullough
Chief Executive.
30 June 2003.
GROUP PROFIT AND LOSS ACCOUNT AND GROUP BALANCE SHEET FOR THE YEAR ENDED 31
DECEMBER 2002 FOLLOW
For further information contact Hugh McCullough, Chief Executive.
Tel. +353-1-6619974
Fax +353-1-6611205
Email info@glencarmining.ie
GLENCAR MINING PLC
GROUP PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31 DECEMBER 2002
2002 2001
US$ US$
TURNOVER - 21,777,176
COST OF SALES -
Operating costs - (17,684,979)
Depreciation, amortisation and reclamation - (555,773)
- (18,240,752)
OPERATING PROFIT - 3,536,424
EXCEPTIONAL ITEMS (5,692,367) (21,030,430)
ADMINISTRATIVE EXPENSES (528,942) (819,351)
OTHER INCOME - 66,843
LOSS ON ORDINARY
ACTIVITIES BEFORE INTEREST (6,221,309) (18,246,514)
INTEREST RECEIVABLE 10,766 2,755,155
BANK INTEREST PAYABLE (522,071) (4,008,437)
LOSS ON ORDINARY
ACTIVITIES BEFORE TAXATION (6,732,614) (19,499,796)
TAXATION - -
LOSS ON ORDINARY
ACTIVITIES AFTER TAXATION (6,732,614) (19,499,796)
MINORITY INTEREST (18,376,367) 6,665,422
LOSS FOR THE FINANCIAL YEAR (25,108,981) (12,834,374)
LOSS PER SHARE (CENTS) (25.7) (13.1)
DILUTED LOSS PER SHARE (CENTS) (25.7) (13.1)
GLENCAR MINING PLC
GROUP BALANCE SHEET AS AT 31 DECEMBER 2002
Pro-Forma
Unaudited
31-Dec-02 31-Dec-01 31-Dec-02
US$ US$ US$
FIXED ASSETS
Intangible and tangible assets 1,975,217 7,609,121 1,975,217
--------------- --------------- -------------
CURRENT ASSETS
Stock - 6,343,454 -
Debtors 68,084 84,825 68,084
Cash at bank 535,059 955,474 1,535,059
--------------- --------------- -------------
603,143 7,383,753 1,603,143
CREDITORS (Amounts falling due within one year) (47,655,369) (54,502,186) (529,621)
--------------- --------------- -------------
NET CURRENT (LIABILITIES) / ASSETS (47,052,226) (47,118,433) 1,073,522
--------------- --------------- -------------
TOTAL NET (LIABILITIES) / ASSETS (45,077,009) (39,509,312) 3,048,739
========= ========= ========
CAPITAL AND RESERVES
Called up share capital 3,423,001 3,423,001 5,202,713
Share premium account 35,629,820 35,629,820 35,629,820
Capital conversion reserve fund 82,092 82,092 82,092
Profit and loss account (deficit) (84,099,012) (59,815,148) (37,752,976)
--------------- --------------- ---------------
TOTAL CAPITAL EMPLOYED (44,964,099) (20,680,235) 3,161,649
MINORITY INTEREST IN SUBSIDIARY UNDERTAKING (112,910) (18,829,077) (112,910)
--------------- --------------- ------------
(45,077,009) (39,509,312) 3,048,739
========= ========= =======
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