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Rsg - Resource Generation Limited - Financial Effects Of The Issue Of New

Release Date: 15/12/2010 10:10:08      Code(s): RSG
RSG - Resource Generation Limited - Financial effects of the issue of new       
ordinary shares by equity placement                                             
Resource Generation Limited                                                     
Registration number ACN 059 950 337                                             
(Incorporated and registered in Australia)                                      
Share code on the JSE Limited: RSG                                              
Share code on the Australian Stock Exchange: RES                                
ISIN Code: AU000000RES1                                                         
("Resgen")                                                                      
FINANCIAL EFFECTS OF THE ISSUE OF NEW ORDINARY SHARES BY EQUITY PLACEMENT       
Notice is hereby given of the issue of 32,600,000 Resgen ordinary shares on 15  
December 2010 representing the second tranche of the equity raising announced on
4 November 2010 and approved at a General Meeting of shareholders on 13 December
2010("the Transaction") at a price of $A0.50 per share.                         
The new issue of ordinary shares will simultaneously be listed on the Official  
List of the Australian Stock Exchange ("ASX") and the JSE Limited ("JSE"). The  
securities rank pari passu with Resgen`s other issued securities. Resgen has the
ability under the ASX Listing Rules to make this issue.                         
The proceeds of the Transaction will be used primarily for the development of   
the company`s Boikarabelo Mine in South Africa and for working capital.         
PRO FORMA FINANCIAL EFFECTS OF THE TRANSACTION                                  
The unaudited pro forma financial effects of the Transaction, as set out below, 
are based on Resgen`s results for the year ended 30 June 2010. The number of    
shares on issue before the Transaction reflect the quantum as notified to the   
ASX and JSE on 8 December of 1,220,000 ordinary shares pursuant to the Share    
Purchase Plan and on 4 November 2010 following the first tranche of the equity  
placement of 27,400,000 ordinary shares to institutions and sophisticated       
investors, which was also after the earlier placement to Integrated Coal Mining 
Limited as disclosed to the JSE on 21 September 2010.                           
The unaudited pro forma financial effects are presented for illustrative        
purposes only, to provide information on the impact of the issue.  Due to the   
nature of the unaudited pro forma financial effects, they may not give a fair   
representation of Resgen`s financial position and the results of its operations 
after the Transaction.                                                          
Resgen`s directors are responsible for the preparation of the unaudited pro     
forma financial information. The accounting policies of Resgen have been used in
preparing the pro forma financial effects of the Transaction.                   
The effects of the Transaction                                                  
                  Before the Transaction   After the Transaction   Percentage   
- 30 June 2010           - 30 June 2010          change       
                  (A$ cents)               (A$ cents)              %            
Earnings per       (1.8)                    (1.5)                   16.7        
share(1)                                                                        
Headline earnings  (1.8)                    (1.5)                   16.7        
per share(1)                                                                    
Net asset value    42                       36                      (14.3)      
per share(2)                                                                    
Net tangible       42                       36                      (14.3)      
asset value per                                                                 
share(2)                                                                        
Number of shares   211,300,530              243,900,530             15.4        
in issue                                                                        
Weighted average                                                                
number of shares   200,429,172              233,029,172             16.3        
in issue                                                                        
Notes:                                                                          
1    The amounts in the "Before" column represent the earnings and headline     
    earnings per share as disclosed in the financial results for the year ended 
    30 June 2010 but after the earlier placements to Integrated Coal Mining     
Limited as disclosed to the JSE on 21 September 2010 and after the first    
    tranche of the equity placement as disclosed to the JSE on 4 November 2010  
    and the issue of shares under the Share Purchase Plan on 8 December 2010.   
    The amounts in the "After" column represent the earnings and headline       
earnings per share on the assumption that the Transaction was effective     
    from 1 July 2009.                                                           
2    The amounts in the "Before" column represent the net asset value and net   
    tangible asset value per share as disclosed in the financial results for    
the year ended 30 June 2010 but after the earlier placement to Integrated   
    Coal Mining Limited as disclosed to the JSE on 21 September 2010 and after  
    the first tranche of the equity placement as disclosed to the JSE on 4      
    November 2010 and the issue of shares under the Share Purchase Plan on 8    
December 2010. The amounts in the "After" column represent the net asset    
    value and net tangible asset value per share based on the financial results 
    for the year ended 30 June 2010 adjusted for the Transaction, had it been   
    effected on 30 June 2010.                                                   
3    Transaction costs of $nil have been taken into account.                    
4    Proceeds will be used primarily for the continuing development of the      
    company`s Boikarabelo Mine in South Africa and for working capital.  We     
    have not assumed interest was theoretically earned on this money from 1     
July 2009.                                                                  
Sydney, Australia                                                               
15 December 2010                                                                
Sponsor                                                                         
Deloitte & Touche Sponsor Services (Proprietary) Limited                        
(Incorporated in the Republic of South Africa)                                  
(Registration number 1996/000034/07                                             
Date: 15/12/2010 10:10:07 Supplied by www.sharenet.co.za                     
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