Final Results
15 September 2008
MEDUSA MINING LIMITED
(AIM: MML)
Final results for the year ended 30 June 2008
Medusa Mining Limited ("Medusa" or the "Company"), the Australian
based company operating and developing gold mines in the Philippines,
through its Philippines operating company Philsaga Mining Corporation
("Philsaga") announces its final results for the year ended 30 June
2008.
Highlights:
* Granted 25 year mining licence at Co-O Mine
* Expansion work at Co-O Mine on target
* Drilling at Co-O Mine find new discoveries and extension of
high-grade systems
* Commenced drilling at Lingig and Kamarangan
Post year end:
* JORC compliant resource update in August
For further information, please contact:
Medusa Mining Limited +61 8 9367 0601
Geoffrey Davis, Managing Director
Roy Daniel, Finance Director
Fairfax I.S. PLC +44 (0)20 7598 5368
Nominated Adviser / Joint Broker
Ewan Leggat
Mirabaud Securities Limited +44 (0)20 7321 2508
Joint Broker
Peter Krens
Lothbury Financial +44 (0)20 7011 9411
Michael Padley / Louise Davis
CHAIRMAN'S REVIEW
As I reflect on the year, I am pleased to say that it has been one of
significant accomplishment. In particular, the Company has achieved
the granting of a 25-year mining licence over the Co-O Mine and
surrounds, which alleviates the tenure security issue that was a
concern for some investors and has focused on mine development to set
up ore extraction at significantly increased rates for the years
ahead.
The Company made the difficult decision during the year to focus on
development for the future at the expense of near-term gold
production. This was not an easy decision but we are now starting to
see the merits of that decision being borne out with increasing gold
production and anticipated lower cash costs. Also, our decision to
continue significant expenditure on drilling is continuing to bear
substantial rewards with the discovery of new vein systems across
strike and the extension of high-grade systems along strike and at
depth. This drilling is demonstrating that we are in a large vein
system with enormous upside potential. Added to the high-grade
quartz vein potential is the added benefit of our drilling at Lingig
and Kamarangan where there is scope to define large-scale copper-gold
porphyry deposits.
The Co-O Mine is now going from strength to strength and is showing
signs of developing into a premier mine on an international basis in
terms of low, long-term cash costs, high gold grades, increased
resources and eventually increased gold production. Despite the
decision in September 2007 to increase the mine's production capacity
under the Phase I expansion, we have continued to produce low cash
cost ounces while the re-development was progressing. We will see
the benefits of this project starting to flow through in the coming
quarters with the Company on-track to achieve its 60,000 ounce
production target in mid-2009.
Phase ll of the expansion has already started and is expected to
achieve its timeline of early 2010. At this juncture, the Company is
anticipating long-term cash costs of around US$200 per ounce, making
it one of the lowest-cost gold producers in the world.
Recent geological advances through both drilling and mining suggest
that the vein systems at the Co-O Mine will continue to be extended
along strike east and west, across strike and at depth. We are
planning to continue drilling at Co-O for the foreseeable future due
to our success at discovering and extending the vein systems and to
explore the possibility of the veins coalescing at depth into wider
parent veins such as those at Diwalwal 60 km to the south where the
upper veins coalesced into a single vein at depth some 19 metres wide
at 100 g/t gold.
On the exploration front, the Company has recently commenced the
drilling of what are interpreted to be two large porphyry copper
systems, at Lingig and Kamarangan. These systems have the potential
in the long-term to elevate the Company to a new level and we look
forward to a flow of positive results over the year ahead.
At the local level in our communities, the Company has completed its
initial programme at the Manabo Village with the construction of 318
houses and is proposing a four class room school for early 2009.
Elsewhere, through the Mindanao Philsaga Foundation, the Company is
supporting a programme of micro-loans to rice farmers to assist them
at becoming more profitable. Other community programmes are ongoing
to ensure reciprocal beneficial relationships are maintained between
the Company and its host communities.
In closing, I would like to acknowledge the tireless efforts of our
Board and our team in Perth led by our Managing Director Geoff Davis
and assisted closely by Roy Daniel. In the Philippines, I would like
to thank Bill Phillips and Sammy Afdal as well as their co-workers
for their continued positive and equally tireless efforts at
expanding our operations. Finally, I would like to express our
sincere gratitude to the local community and the Philippines
government at all levels for their continued positive support of our
involvement in the community.
I am looking forward to a year of significant achievements with
increased gold production, extensions of mineralisation at Co-O and
the possibility of a significant porphyry discovery which could
propel Medusa into the spotlight on the world stage.
Kevin Tomlinson
Chairman
INCOME STATEMENT
For the year ended 30 June 2008
Consolidated Company
2008 2007 2008 2007
$ $ $ $
Revenue 18,074,035 21,536,694 1,819,183 376,069
Cost of sales (10,066,585) (4,953,835) - -
Exploration and (572,221) (1,129,230) - 46,752
evaluation expenses
Finance cost (375,842) - - -
Administration (3,307,302) (3,750,068) (1,578,609) (1,408,989)
expenses
Other expenses (2,733,646) (2,724,455) (2,437,571) (2,134,065)
Profit/(loss) before 1,018,439 8,979,106 (2,196,997) (3,120,233)
income tax expenses
Income tax expense (2,365,928) - - -
Profit/(loss)
attributable to
members of the
Company (1,347,489) 8,979,106 (2,196,997) (3,120,233)
Basic
earnings/(loss) per
share ($0.009) $0.095
Diluted
earnings/(loss) per
share ($0.009) $0.089
BALANCE SHEET
For the year ended 30 June 2008
Consolidated Company
2008 2007 2008 2007
$ $ $ $
CURRENT ASSETS
Cash & cash 4,834,161 20,168,063 2,242,620 19,166,563
equivalents
Trade & other 2,185,194 1,217,883 27,425 64,475
receivables
Inventories 935,976 1,631,108 - -
Other current assets 333,119 277,831 29,484 170,980
Other financial assets - 730,000 - 730,000
Total Current Assets 8,288,450 24,024,885 2,299,529 20,132,018
Non-Current Assets
Property, plant & equipment 28,499,551 29,525,621 60,481 57,780
Exploration and evaluation expenditure 28,292,304 23,118,911 - -
Development expenditure 12,447,889 7,230,444 - -
Deferred tax assets 2,851,792 - - -
Other financial assets - 31,911 56,143,200 44,867,570
Total Non-Current Assets 72,091,536 59,906,887 56,203,681 44,925,350
Total Assets 80,379,986 83,931,772 58,503,210 65,057,368
Current Liabilities
Trade & other payables 6,845,501 13,461,483 1,217,702 7,814,144
Total Current Liabilities 6,845,501 13,461,483 1,217,702 7,814,144
NON CURRENT LIABILITIES
Deferred tax liability 5,217,720 - - -
Total Non-Current Liabilities 5,217,720 - - -
Total Liabilities 12,063,221 13,461,483 1,217,702 7,814,144
Net 68,316,765 70,470,289 57,285,508 57,243,224
Assets
Equity
Issued capital 65,866,550 63,805,000 65,866,550 63,805,000
Reserves (529,337) 2,338,248 1,722,692 1,544,961
Retained profits/(accumulated 2,979,552 4,327,041 (10,303,734) (8,106,737)
losses)
Total equity 68,316,765 70,470,289 57,285,508 57,243,224
STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2008
Foreign
Share Currency
Capital Accumulated Option Translation
Ordinary Losses Reserve Reserve Total
$ $ $ $ $
Consolidated
Balance at 16,075,833 (5,050,911) 1,412,416 472,864 12,910,202
01.07.2006
Shares 47,729,167 - - - 47,729,167
issued
during the
period
Share
options
issued -
during the
period in
accordance
with AASB 2
- - Share
Based
Payment - - 531,391 531,391
Exchange
differences
arising on
translation - - - 320,423 320,423
Transfer -
from Option
Reserve - 398,846 (398,846) -
Profit -
attributable
to members
of Company - 8,979,106 - 8,979,106
Balance at 63,805,000 4,327,041 1,544,961 793,287 70,470,289
30.06.2007
Shares 1,067,450 - - - 1,067,450
issued
during the
period
Share
options
issued -
during the
period in
accordance
with AASB 2
- - Share
Based
Payment - - 1,171,831 1,171,831
Exchange
differences
arising on
translation - - - (3,045,316) (3,045,316)
Transfer -
from Option
Reserve 994,100 - (994,100) -
Loss -
attributable
to members
of Company - (1,347,489) - (1,347,489)
Balance at 65,866,550 2,979,552 1,722,692 (2,252,029) 68,316,765
30.06.2008
Company
Balance at 16,075,833 (5,385,350) 1,412,416 - 12,102,899
01.07.2006
Shares 47,729,167 - - - 47,729,167
issued
during the
period
Share
options - - 531,391 - 531,391
issued
during the
period in
accordance
with AASB 2
- - Share
Based
Payment
Transfer - - -
from Option
Reserve 398,846 (398,846)
Loss - (3,120,233) - - (3,120,233)
attributable
to members
of Company
Balance at 63,805,000 (8,106,737) 1,544,961 - 57,243,224
30.06.2007
Shares 1,067,450 - - - 1,067,450
issued
during the
period
Share
options - - 1,171,831 - 1,171,831
issued
during the
period in
accordance
with AASB 2
- - Share
Based
Payment
Transfer - -
from Option
Reserve 994,100 - (994,100)
Loss - (2,196,997) - - (2,196,997)
attributable
to members
of Company
Balance at 65,866,550 (10,303,734) 1,722,692 - 57,285,508
30.06.2008
CASH FLOW STATEMENT
For the year ended 30 June 2008
Consolidated Company
2008 2007 2008 2007
$ $ $ $
CASH FLOWS FROM OPERATING
ACTIVITIES
Receipts from customers 17,540,189 9,712,907 805 3,000
Payments to suppliers and (10,738,999) (9,688,139) (2,708,082) (2,389,838)
employees
Interest 399,085 96,208 389,073 89,235
received
Net cash provided 7,200,275 120,976 (2,318,204) (2,297,604)
by/(used in) operating
activities
CASH FLOWS FROM INVESTING
ACTIVITIES
Receipt from sale of 110,119 223,367 110,119 223,367
shares
Payments for plant and (2,313,575) (1,387,863) (17,508) (12,018)
equipment
Payments for exploration (8,293,728) (4,167,894) - (1,813,684)
activities
Payment for development (6,546,801) (4,123,389) - -
activities
Loans to controlled and - (50,195) (9,621,057) (6,522,899)
joint venture
entities
Investment in controlled - - - (2,500)
and joint venture
entities
Acquisition of controlled - (9,123,251) - (8,000,000)
entities
Net cash used in investing (17,043,985) (18,629,225) (9,528,446) (16,127,733)
activities
CASH FLOWS FROM FINANCING
ACTIVITIES
Proceeds from issue of 1,742,200 35,907,867 1,742,200 35,907,867
shares
Transaction costs from (1,811,250) (721,957) (1,811,250) (721,957)
issue of shares
Repayment of vendor (5,000,000) - (5,000,000) -
finance
Net cash provided by (used in) (5,069,050) 35,185,910 (5,069,050) 35,185,910
financing activities
Net (decrease)/increase (14,912,760) 16,677,661 (16,915,700) 16,760,573
in cash held
Cash at the beginning of 20,168,063 3,494,291 19,166,563 2,405,990
the financial year
Exchange rate adjustment (421,142) (3,889) (8,243) -
Cash at the end of the 4,834,161 20,168,063 2,242,620 19,166,563
financial year
NOTES
For the year ended 30 June 2008
1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
The financial report is a general purpose financial report which has
been prepared in accordance with Australian Accounting Standards,
including Australian Accounting Interpretations, other authoritative
pronouncements of the Australian Accounting Standards Board and the
Corporations Act 2001.
Australian Accounting Standards set out accounting policies that the
AASB has concluded would result in a financial report containing
relevant and reliable information about transactions, events and
conditions to which they apply. Compliance with Australian Accounting
Standards ensures that the financial statements and notes also comply
with International Financial Reporting Standards. Material
accounting policies adopted in the preparation of this financial
report are presented below. They have been consistently applied
unless otherwise stated.
The financial report covers the Group of Medusa Mining Limited
("Medusa") and controlled entities, and Medusa as an individual
Company. Medusa is a listed public company, incorporated and
domiciled in Australia.
2. BASIS OF PREPARATION
Reporting Basis and Conventions
The financial report has been prepared on an accruals basis and is
based on historical costs modified by the revaluation of selected
non-current assets, financial assets and financial liabilities for
which the fair value basis of accounting has been applied.
(a) Principles of Consolidation
A controlled entity is any entity over which Medusa has the power to
govern the financial and operating policies so as to obtain benefits
from its activities. In assessing the power to govern, the existence
and effect of holdings of actual and potential voting rights are
considered.
A list of controlled entities is contained in Note 19 to the
financial statements.
As at reporting date, the assets and liabilities of all controlled
entities have been incorporated into the consolidated financial
statements as well as their results for the year then ended. Where
controlled entities have entered (left) the consolidated group during
the year, their operating results have been included (excluded) from
the date control was obtained (ceased).
All inter-group balances and transactions between entities in the
consolidated group, including any unrealised profits or losses, have
been eliminated on consolidation. Accounting policies of subsidiaries
have been changed where necessary to ensure consistency with those
adopted by the parent entity
Minority interests, being that portion of the profit or loss and net
assets of subsidiaries attributable to equity interests held by
persons outside the group, are shown separately within the Equity
section of the consolidated Balance Sheet and in the consolidated
Income Statement
(b) Comparative Figures
Where required by Accounting Standards, comparative figures have been
adjusted to conform with changes in presentation for the current
financial year.
(c) Revenue Recognition
Revenue is measured at the fair value of the consideration received
or receivable after taking into account any trade discounts and
volume rebates allowed. Any consideration deferred is treated as the
provision of finance and is discounted at a rate of interest that is
generally accepted in the market for similar arrangements. The
difference between the amount initially recognised and the amount
ultimately received is interest revenue.
Gold and Silver Sales
Revenue from the production of gold and silver is recognised when the
product is in the form in which it can be sold based on the delivered
price.
Interest Revenue
Interest revenue is recognised using the effective
interest rate method, which, for floating rate financial assets, is
the rate inherent in the instrument.
Dividends
Dividend revenue (net of franking credits) is recognised
when the right to receive a dividend has been established.
Dividends received from associates and joint venture
entities are accounted for in accordance with the equity method of
accounting and recognised when the dividends are received.
All revenue is stated net of the amount of goods and
services tax ("GST").
(d) Income Tax
The income tax expense (revenue) for the year comprises current
income tax expense (income) and deferred tax expense (income).
3. DIVIDENDS
There was no dividend paid or declared by the Company since the end
of the previous financial year and the Directors do not recommend the
payment of a dividend in respect of the current financial year (2007:
$Nil)
4. LOSS PER SHARE
Consolidated
2008 2007
$ $
Weighted average number of ordinary shares 143,626,534 94,438,520
used in the calculation of the basic earnings
per share.
Plus unlisted options on issue 12,401,446 6,021,446
Weighted average of ordinary shares diluted 156,027,980 100,459,966
as at 30 June 2008
- ---END OF MESSAGE---
Medusa (LSE:MML)
Historical Stock Chart
From Jun 2024 to Jul 2024
Medusa (LSE:MML)
Historical Stock Chart
From Jul 2023 to Jul 2024
