Wrap Text
Unaudited Interim Consolidated Financial Statements for the period ended 31 May 2015
Rockwell Diamonds Inc.
(A company incorporated in accordance with the laws of
British Columbia, Canada)
(Incorporation number BC0354545)
(South African registration number: 2007/031582/10)
Share code on the JSE Limited: RDI
ISIN: CA77434W2022
Share code on the TSX: RDI CUSIP Number: 77434W103
(“Rockwell” or “the Group”)
14 July 2015
Unaudited Interim Consolidated Financial Statements
for the period ended 31 May 2015
Consolidated Statements of Financial Position
As at As at
31 May 28 February
Amounts in Canadian Dollars (‘000) 2015 2015
Assets
Non-current assets
Mineral property interests 27 385 16 518
Investment in associates 413 396
Property, plant and equipment 38 181 27 001
Investments and deposits 1 492 1 502
Rehabilitation deposits 3 990 3 376
Total non-current assets 71 461 48 793
Current assets
Inventories 2 403 2 177
Loans to related parties – 8
Current tax receivable 35 37
Trade and other receivables 8 727 4 889
Cash and cash equivalents 952 576
Assets held for sale – 13 525
Total current assets 12 117 21 212
Total assets 83 578 70 005
Equity and liabilities
Equity
Share capital 147 435 147 435
Reserves (11 372) (8 575)
Retained loss (107 222) (102 076)
Total equity attributable to the
equity holders of the Group 28 841 36 784
Non-controlling interest (661) (2 369)
Total equity 28 180 34 415
Liabilities
Non-current liabilities
Loans and borrowings 1 068 3 844
Finance lease obligation 1 050 1 276
Deferred tax 4 692 2 995
Rehabilitation obligation 6 768 5 987
Total non-current liabilities 13 578 14 102
Current liabilities
Loans from related parties 176 162
Loans and borrowings 27 315 2 296
Finance lease obligation 688 708
Trade and other payables 11 390 10 902
Bank overdraft 2 251 –
Liabilities held for sale – 7 420
Total current liabilities 41 820 21 488
Total liabilities 55 398 35 590
Total equity and liabilities 83 578 70 005
Consolidated Statements of Financial Performance
3 months 3 months
ended ended
31 May 31 May
Amounts in Canadian Dollars (‘000) 2015 2014
Sale of diamonds 8 269 9 709
Beneficiation income 970 5 428
Cost of sales before amortization
and depreciation (12 349) (10 874)
Gross (loss) profit before
amortization and depreciation (3 110) 4 263
Amortization of mineral property
interests (109) (237)
Depreciation of property, plant
and equipment (1 300) (1 419)
Rehabilitation obligation
recognized (33) (120)
Gross (loss) profit (4 552) 2 487
Other income 372 (68)
General, administration and
business development expenses (1 604) (1 497)
Loss on sale of subsidiary (1 774) –
Realized foreign exchange with
sale of subsidiary 1 276 –
(Loss) profit before net finance
costs (6 282) 922
Finance income 39 129
Finance costs (304) (187)
(Loss) profit after net finance
costs (6 547) 864
Share of profit from equity
accounted investments 33 34
(Loss) profit before taxation (6 514) 898
Taxation 1 334 (553)
(Loss) profit for the period (5 180) 345
(Loss) profit attributable to:
Owners of the parent (5 146) 405
Non-controlling interest (34) (60)
(5 180) 345
(Loss) earnings per share
Basic and diluted (loss) earnings
per share (cents) (9.43) 0.76
Consolidated Statements of Comprehensive Income
3 months 3 months
ended ended
31 May 31 May
Amounts in Canadian Dollars (‘000) 2015 2014
(Loss) profit for the period (5 180) 345
Other comprehensive income net of taxation
Items that are or may be reclassified to
profit or loss
Exchange differences on
translating foreign operations (1 489) (253)
Realized foreign exchange differences
with sale of
subsidiary (1 276) –
Other comprehensive income for the
period net of taxation (2 765) (253)
Total comprehensive income (7 945) 92
Total comprehensive income attributable to:
Owners of the Group (7 975) 141
Non-controlling interest 30 (49)
Total comprehensive income for the
period (7 945) 92
Consolidated Statements of Changes in Equity
Foreign Share-
currency based
Share translation payment
Amounts in Canadian Dollars(‘000) capital reserve* reserve**
Balance at 01 March 2014 147 073 (18 799) 8 790
Total comprehensive income for
the period
Profit (loss) for the period – – –
Other comprehensive income – (264) –
Total comprehensive income for
the year – (264) –
Share based payment expense – – 113
Total changes – (264) 113
Balance at 31 May 2014 147 073 (19 063) 8 903
Balance at 01 March 2015 147 435 (17 605) 9 030
Total comprehensive income for
the period
Loss for the period – – –
Other comprehensive income – (2 829) –
Total comprehensive income for
the year – (2 829) –
Share based payment expense – – 32
Sale of subisdiary – – –
Total changes – (2 829) 32
Balance at 31 May 2015 147 435 (20 434) 9 062
Total
equity
attribu-
table
to equity
Total holders
net Retained of the
Amounts in Canadian Dollars(‘000) reserves loss Group
Balance at 01 March 2014 (10 009) (88 096) 48 968
Total comprehensive income for
the period
Profit (loss) for the period – 405 405
Other comprehensive income (264) – (264)
Total comprehensive income for
the year (264) 405 141
Share based payment expense 113 – 113
Total changes (151) 405 254
Balance at 31 May 2014 (10 160) (87 691) 49 222
Balance at 01 March 2015 (8 575) (102 076) 36 784
Total comprehensive income for
the period
Loss for the period – (5 146) (5 146)
Other comprehensive income (2 829) – (2 829)
Total comprehensive income for
the year (2 829) (5 146) (7 975)
Share based payment expense 32 – 32
Sale of subisdiary – – –
Total changes (2 797) (5 146) (7 943)
Balance at 31 May 2015 (11 372) (107 222) 28 841
Non-
controlling Total
Amounts in Canadian Dollars (‘000) interest equity
Balance at 01 March 2014 (1 737) 47 231
Total comprehensive income for the period
Profit (loss) for the period (60) 345
Other comprehensive income 11 (253)
Total comprehensive income for the year (49) 92
Share based payment expense – 113
Total changes (49) 205
Balance at 31 May 2014 (1 786) 47 436
Balance at 01 March 2015 (2 369) 34 415
Total comprehensive income for the period
Loss for the period (34) (5 180)
Other comprehensive income 64 (2 765)
Total comprehensive income for the year 30 (7 945)
Share based payment expense – 32
Sale of subisdiary 1 678 1 678
Total changes 1 708 (6 235)
Balance at 31 May 2015 (661) 28 180
* Currency translation differences arising on the conversion of the
results and financial position of foreign operations from their
functional currency to the Company's presentation currency are
accumulated in the foreign currency translation reserve.
** Equity settled share based payment transactions are accumulated in
the share based payment reserve.
Consolidated Statements of Cash Flows
3 months 3 months
ended ended
31 May 31 May
Amounts in Canadian Dollars (‘000) 2015 2014
Cash flows from operating activities
Cash receipts from customers 8 862 15 129
Cash paid to suppliers and
employees (13 882) (14 006)
Cash (utilised in) generated from
operations (5 020) 1 123
Finance income 39 41
Finance costs (111) (70)
Net cash (outflow) inflow from
operating activities (5 092) 1 094
Cash flows from investing activities
Purchase of property, plant and
equipment (260) (489)
Proceeds from sale of property,
plant and equipment – 356
Purchase of mineral property
interests – (283)
Sale of mineral property interests 515 –
Acquisition of subsidiary and
business combination (1 708) –
Investment in joint venture – (103)
Proceeds from sale of subsidiary 2 266 –
Increase in related party loans 20 75
Increase in investments and
deposits (71) (324)
Increase in rehabilitation
deposits (34) 63
Net cash inflow (outflow) from
investing activities 728 (705)
Cash flows from financing activities
Proceeds from (repayment of) loans
and borrowings 1 921 (3)
Repayment of finance lease
obligations (208) (78)
Net cash inflow (outflow) from
financing activities 1 713 (81)
Net movement in cash and cash
equivalents for the period (2 651) 308
Cash and cash equivalents at the
beginning of the period 576 (1 761)
Cash and cash equivalents released
from assets held for sale 776 –
Total cash and cash equivalents at
end of the period (1 299) (1 453)
Sale of subsidiary
The consortium assumed control of Tirisano on March 28, 2015, and
therefore the Group accounted for the sale as of that date.
The cash consideration will be settled by way of twoinitial payments
totaling ZAR20 million ($2.1 million), already received in Q1 2016,
followed by 20 equal monthly instalments of ZAR2 million ($0.21 million),
of which 1 had been received during Q1 2016. Therefore as at May 31, 2015,
ZAR38 million ($3.9 million) was outstanding on the sale price.
As at
31 May
2015
Carrying value of assets sold
Property, plant and equipment 1 417
Mineral property interests 8 000
Rehabilitation obligation (2 072)
Rehabilitation deposits 1 739
Trade and other receivables 1 142
Trade and other payables (238)
Loans and borrowings (3 720)
Loan to related party 8
Outside shareholders 1 678
Total net assets sold 7 954
Net assets sold 7 954
Loss on disposal (1 774)
6 180
Consideration received
Cash 2 266
Deferred consideration 3 914
6 180
Acquisition of subsidiary and business combination
Business combination
On June 25, 2015, Rockwell announced the closing of the Bondeo
140 cc acquisition (“Steyn Transaction”), and assumed control on
May 28, 2015. All required approvals and bridging finance have been
secured to end of August 2015.
The transaction was effective May 28, 2015, and all acqusition
entries are accounted for in Q1 2016. From a practical point of
view, the 3 days of operations to end May 2015 will be accounted for
in Q2 2016, and are not considered material to the Q1 2016 results of
Rockwell.
The acquisition was accounted for as an acquired business in terms of
IFRS 3: Business Combinations.
The movable assets acquired have been included in a first security
charge securing the bridging loan from Diacore.
The following summarises the fair value of assets and liabilities
acquired
3 months
ended
31 May
2015
Mineral property interests 12 151
Property, plant and equipment 13 385
Deferred tax (3 113)
Rehabilitation deposits 724
Rehabilitation obligation (994)
Other liabilities (99)
Total identifiable net assets 22 054
The Group financed the purchase consideration through
Cash (513)
Bridging finance – Diacore (paid directly by vendor to
seller) (20 346)
Bridging finance – Mark Bristow (1 195)
(22 054)
Net cash outflow on acquisition
Cash consideration paid (1 708)
Acquisition of subsidiary
As part of the Steyn Transaction, Rockwell acquired 100% of the share
capital in Pioneer Minerals Proprietary Limited (“Pioneer”),
an unlisted entity, for an amount of $6.2 million. Pioneer owns the
mining right in the Remhoogte property.
The $6.2 million is included in the Mineral property interests above.
3 months 3 months
ended ended
31 May 31 May
2015 2014
(Loss) earnings per share
Basic and diluted (loss) earnings per share
Cents per share (9.43) 0.76
Basic (loss) earnings per share was
calculated based on a weighted average
number of common shares of 54 558 244 for
the 3 months ended 31 May 2015 (3 months
ended 31 May 2014: 53 523 244).
Reconciliation of (loss) earnings for the
year to basic (loss) earnings
(Loss) earnings for the period (5 180) 345
Adjusted for:
Loss attributable to non controlling interest 34 60
Basic (loss) earnings attributable to owners
of the Group (5 146) 405
At 31 May 2015 the impact of share based
payment options were excluded from the weighted
average number of shares, for the purpose
of the diluted loss per share calculation,
as the effect would have been anti dilutive.
Basic and diluted headline earnings per share
Cents per share (8.82) 1.12
Reconciliation between basic (loss) earnings
and headline (loss) earnings
Basic (loss) earnings attributable to owners
of the Group (5 146) 405
Adjusted for:
Profit on disposal of mineral properties (165) –
Loss on disposal of property, plant and
equipment – 227
Share of profit from equity accounted
investment – (34)
Loss on sale of subsidiary 1 774 –
Realized foreign exchange with sale of
subsidiary (1 276) –
Non controlling interest portion of above
adjustments – –
Headline (loss) earnings attributable to
owners of the Group (4 813) 598
The basic and diluted headline (loss) earnings per share disclosure
is provided based on the listing requirements of the Johannesburg
Stock Exchange (Groupís secondary listing). The disclosure of basic
and diluted headline (loss) earnings per share is provided in
accordance with Circular 2/2013 as issued by the South African
Institute of Chartered Accountants. Headline (loss) earnings
represents the basic (loss) earnings attributable to the owners of
the Group excluding certain re measurements.
At 31 May 2015 the impact of share based payment options were
excluded from the weighted average number of shares, for the purpose
of the diluted headline (loss) earnings per share calculation, as the
effect would have been anti dilutive.
Segmental information
The Group has three reportable operating segments, as described
below, which are the Groupís operating divisions. These divisions
offer different diamond product characteristics, qualities,
geological characteristics, processes and services, and are managed
separately because they require different technology and profit or
cost strategies. For each of the divisions the Group executive
committee (chief operating decision making body) reviews internally
managed reports on at least a monthly basis. The following describes
the operations in each of the Groupís reportable segments:
– Northern Cape operation is associated with the mining of Paleo
Channels and Rooikoppie gravels and the recovery of high value and
larger carat size diamonds;
– North West operation is associated with the mining of potholes and
the recovery of lower value and smaller carat size diamonds; and
– Corporate represents the corporate management and administrative
function of the Group.
The reconciliation column represents the inter group transactions
eliminated on consolidation. All reportable segments are located in
the same geographical jurisdiction. Information regarding the results
of each of the reportable segments is included below.
For the 3 months ended
31 May 2015 Northern Cape North West Corporate
Total assets 70 311 – 71 086
Total liabilities 83 976 – 29 241
External revenue 8 174 1 065 –
Inter-segment revenue (1 054) (55) 1 109
Loss for the period (4 355) (16) (809)
For the 3 months ended 31 May 2015 Reconciling Total
Total assets (57 819) 83 578
Total liabilities (57 819) 55 398
External revenue – 9 239
Inter-segment revenue – –
Loss for the period – (5 180)
As at 28 February 2015 Northern Cape North West Corporate
Total assets 47 415 13 525 65 672
Total liabilities 63 578 22 007 6 612
As at 28 February 2015 Reconciling Total
Total assets (56 607) 70 005
Total liabilities (56 607) 35 590
For the 3 months ended
31 May 2014 Northern Cape North West Corporate
External revenue 12 320 2 817 -
Inter-segment revenue (773) (258) 1 031
Profit (loss) for the period 838 (344) (149)
For the 3 months ended
31 May 2014 Reconciling Total
External revenue – 15 137
Inter-segment revenue – –
Profit (loss) for the period – 345
JSE Sponsor
PSG Capital
Date: 15/07/2015 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
Sharenet Sites 
