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GBG - Great Basin Gold Limited - Unaudited interim consolidated financial

Release Date: 17/05/2011 14:30
Code(s): GBG
Wrap Text

GBG - Great Basin Gold Limited - Unaudited interim consolidated financial statements for the quarter ended March 31, 2011 GREAT BASIN GOLD LIMITED (Incorporated in Canada and registered as an External Company in South Africa) (Registration No. 2006/021304/10) Share Code: GBG ISIN Number: CA3901241057 ("Great Basin" or "the Company") UNAUDITED INTERIM CONSOLIDATED FINANCIAL STATEMENTS FOR THE QUARTER ENDED MARCH 31, 2011 CONSOLIDATED STATEMENT OF FINANCIAL POSITION (Expressed in thousands of Canadian Dollars) March 31 December 31 January 1
2011 2010 2010 $`000 $`000 $`000 Assets
Current assets Cash and cash equivalents 68,017 12,855 89,464 Trade and other receivables 7,292 9,340 5,053 Inventories 29,257 18,440 26,312 Other current assets 1,067 1,283 6,033 105,633 41,918 126,862 Non-current assets Loans due from related party 12,940 13,372 - Property, plant and equipment 700,937 695,374 359,281 Restricted cash - - 2,439 Other assets 4,948 4,719 4,590 TOTAL ASSETS 824,458 755,383 493,172 Liabilities Current liabilities Trade payables and accrued 55,147 61,731 29,206 liabilities Current portion of long-term 33,712 53,516 43,768 debt Current portion of other 406 278 - liabilities 89,265 115,525 72,974 Non-current liabilities Long-term debt 203,185 156,062 86,948 Other liabilities 17,824 12,419 - Site reclamation obligations 5,470 5,660 3,990 Total liabilities 315,744 289,666 163,912 Equity Share capital 799,444 709,449 567,596 Warrants 5,042 6,108 13,104 Contributed surplus 78,734 77,676 74,403 Deficit (374,252) (353,911) (326,770) Accumulated other (254) 26,395 927 comprehensive(loss) income 508,714 465,717 329,260 TOTAL LIABILITIES AND EQUITY 824,458 755,383 493,172 CONSOLIDATED STATEMENT OF INCOME For the three months ended March 31, 2011 and March 31, 2010 (Expressed in thousands of Canadian Dollars) 2011 2010
$`000 $`000 Revenue 26,343 6,822 Cost of operations Production cost (14,146) (5,090) Depletion charge (1,134) (140) Depreciation charge (1,214) (203) Expenses (2,901) (2,284) Exploration expenses Pre-development expenses (3,739) (2,872) Corporate and administrative cost (2,282) (1,670) Environmental impact study (437) (496) Foreign exchange gain - net 2,463 1,518 Salaries and compensation Salaries and wages (2,339) (1,296) Share based payments expense (1,441) (890) Loss from operating activities (827) (6,601) Net interest(expense) income (4,682) 630 Loss on settlement of senior secured (8,817) - notes Net unrealized loss on financial (7,279) - instruments recognized Net unrealized marked-to-market 1,264 - adjustments on financial instruments Loss before income tax (20,341) (5,971) Income tax - (116) Loss for the period (20,341) (6,087) (0.05) (0.02) Basic and diluted loss per share 431,624 Weighted average number of common 336,893 shares outstanding (thousands) CONSOLIDATED STATEMENT OF COMPREHENSIVE LOSS For the three months ended March 31, 2011 and March 31, 2010 (Expressed in thousands of Canadian Dollars) 2011 2010 $`000 $`000
Loss for the period (20,341) (6,087) Other comprehensive loss Changes in fair value of available-for- - (104) sale financial instruments Cumulative translation adjustment (26,649) (9,870) Other comprehensive loss for the (26,649) (9,974)) period (46,990) (16,061) Total comprehensive loss for the period
CONSOLIDATED STATEMENTS OF SHAREHOLDERS`EQUITY AND DEFICIT (Expressed in Canadian Dollars) Three months ended Three months ended March 31, 2011 March 31, 2010
$`000 $`000 Common shares Shares Shares (thousands) (thousands) Balance at beginning of 709,449 567,596 the period 414,015 334,158 Shares issued upon 2,221 1,650 exercise of share 949 890 options Shares issued for 6,504 - warrants 4,350 - Proceeds on issuing 81,270 - shares for public offering net of - issuance cost 33,827 Shares issued for - 5,518 mineral properties - 3,074 Balance at end of the 799,444 574,764 period 453,141 338,122 Share purchase warrants Warrants Warrants (thousands) (thousands) Balance at beginning of 6,108 13,104 the period 24,918 86,179 Proceeds on issuing (1,066) - shares (4,350) - Balance at end of the period 20,568 5,042 86,178 13,104
Contributed surplus Balance at beginning of 77,676 74,403 the period Share based 1,870 1,229 compensation Proceeds on issuing (812) (436) Shares Balance at end of the 78,734 75,196 period Deficit Balance at beginning of (353,911) (326,770) the period Nett loss for the (20,341) (6,087) period Balance at end of the (374,252) (332,857) period Accumulated other comprehensive loss Balance at beginning of 26,395 927 the period Other comprehensive (26,649) (9,974) loss Balance at end of the (254) (9,047) period Total accumulated (374,506) (341,904) comprehensive loss and deficit at end of the period TOTAL EQUITY 508,714 321,160 CONSOLIDATED STATEMENTS OF CASH FLOWS For the three months ended March 31, 2011 and 2010 (Expressed in thousands of Canadian Dollars) 2011 2010 $`000 $`000
Operating activities Loss for the period (20,341) (6,087) Items not involving cash Production non-cash charges 170 53 Pre-development non-cash charges 388 194 Exploration non-cash charges 59 74 Depreciation 1,394 255 Unrealized (gain) loss on financial (30) 12 instruments Unrealized loss on financial 7,279 - instruments recognized Unrealized marked-to-market (1,264) - adjustments on financial instruments Share based payments expense 1,441 890 Unrealized foreign exchange gain (2,812) (1,739) Depletion 1,134 140 Interest expense 5,071 49 Interest income (389) (679) Loss on settlement of senior 8,817 - secured notes Changes in non-cash operating working capital Trade and other receivables 1,784 (4,576) Prepaid expenses 183 (446) Inventories (8,540) (8,093) Trade payables and accrued liabilities (3,826) 778 Net cash utilized by operating (9,482) (19,175) activities
Investing activities Additions to property, plant and (36,534) (29,957) equipment Interest income 170 607 Reclamation deposits (361) 128 Net cash utilized by investing (36,725) (29,222) activities
Financing activities Common shares and warrants issued 88,117 1,139 for cash, net of issue costs Proceeds on issuance of debt 68,810 - Repayment of debt (53,686) (286) Interest expense (1,128) (49) Net cash generated from financing 102,113 804 activities Increase(decrease)in cash and cash 55,906 (47,593) equivalents Cash and equivalents, beginning of 12,855 89,464 period Foreign exchange movement on cash (744) (423) and cash equivalents Cash and equivalents, end of period 68,017 41,448 1. GENERAL INFORMATION Great Basin Gold Ltd. ("Great Basin" or "the Company") is incorporated under the laws of the Province of British Columbia and its registered address is 1108-1030 West Georgia Street, Vancouver BC, Canada. The Company is a mineral exploration and development company that is currently focused on delivering two advanced stage projects: the Hollister Project on the Carlin Trend in Nevada, USA and the Burnstone Project in the Witwatersrand Goldfields in South Africa. The Company, currently recognized as an emerging producer, will migrate to the rank of a junior gold producer as production from these two projects increase during 2011 and 2012.Over and above the exploration being conducted at the above mentioned properties, greenfields exploration is being undertaken in Tanzania and Mozambique. Operating results for the three month period ended March 31, 2011 are not necessarily indicative of the results that may be expected for the full fiscal year ending December 31, 2011. In the opinion of management, these unaudited interim consolidated financial statements reflect all adjustments that are necessary for a fair presentation of the results for the interim period presented. 2. BASIS OF PREPARATIONS AND ADOPTION OF IFRS The Company prepares its financial statements in accordance with Canadian Generally Accepted Accounting Principles ("GAAP") as set out in the Handbook of the Canadian Institute of Chartered Accountants ("CICA Handbook"). In 2010, the CICA Handbook was revised to incorporate International Financial Reporting Standards ("IFRS"), and require publicly accountable enterprises to apply such standards effective for years beginning on or after January 1, 2011. Accordingly, the Company has commenced reporting on this basis in these interim consolidated financial statements. In the financial statements, the term "Canadian GAAP" refers to Canadian GAAP before the adoption of IFRS. These condensed interim consolidated financial statements have been prepared in accordance with IFRS applicable to the preparation of interim financial statements, including IAS 34 and IFRS 1. Subject to certain transition elections disclosed in the interim financial statements, the Company has consistently applied the same accounting policies in its opening IFRS statement of financial position at January 1, 2010 and throughout all periods presented, as if these policies had always been in effect. The interim financial statements discloses the impact of the transition to IFRS on the Company`s reported financial position, financial performance and cash flows, including the nature and effect of significant changes in accounting policies from those used in the Company`s consolidated financial statements for the year ended December 31, 2010, which are available through the internet on SEDAR at www.sedar.com. The policies applied in these condensed interim consolidated financial statements are based on IFRS issued and outstanding as of May 5, 2011, the date the Board of Directors approved the statements. Any subsequent changes to IFRS that are given effect in the Company`s annual consolidated financial statements for the year ending December 31, 2011 could result in restatement of these interim consolidated financial statements, including the transition adjustments recognized on change-over to IFRS. The condensed interim consolidated financial statements should be read in conjunction with the Company`s Canadian GAAP and annual financial statements for the year ended December 31, 2010. 3. SIGNIFICANT ACCOUNTING POLICIES, JUDGEMENTS AND ESTIMATION UNCERTAINTY Significant accounting policies These unaudited interim consolidated financial statements follow the same accounting policies and methods of application as the Company`s most recent annual financial statements, except for those changes recognized on change- over to IFRS, as described in interim financial statements. Critical accounting estimates and judgments The Company makes estimates and assumptions concerning the future that will, by definition, seldom equal actual results. The following are the estimates and judgments applied by management that most significantly affect the Company`s financial statements. These estimates and judgments have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Significant areas requiring the use of management estimates relate to impairment of mineral property interests, valuation of inventories, allocation of purchase price consideration to the fair value of identifiable assets and liabilities acquired, the determination of amortization, depletion and accretion, determination of reclamation obligations, the determination of the fair values of financial instruments, assumptions used in determining the fair value of non-cash share based payments, warrants and derivatives, determination of valuation allowances for deferred income tax liabilities, estimated market related interest rate used to calculate the equity component of compound financial instruments and allocation of indirect mining and overhead expenses to production and development costs. 4. SEGMENT DISCLOSURE The Company operates in reportable operating segments to deliver on its strategy to explore, development and operate mineral properties. Management has determined the operating segments based on the reports reviewed by the Company`s Chief Operating Decision Maker ("CODM") that are used to make strategic decisions. The Company`s CODM is its Chief Executive Officer. Geographic information is as follows: Assets March 31 December 31 2011 2010
$`000 $,000 Corporate entities Assets other than mineral property interests 60,337 14,159 Tanzanian exploration Assets other than mineral property interests 595 618 Mineral property interests 45,127 45,127 Nevada operations Assets other than mineral property interests 26,100 21,640 Mine development and equipment 38,762 40,508 Mineral property interests 51,243 53,742 South African operations Assets other than mineral property interests 38,378 25,764 Mine development and equipment 484,003 469,702 Mineral property interests 79,913 84,123 Total assets 755,383 824,458 Revenue March 31 March 31 2011 2010 $`000 $`000
Nevada operations Sale of refined precious metals 22,509 6,822 South African operations Sale of refined precious metals 3,834 - 26,343 6,822 During the three months ended March 31, 2011 the Company generated net revenue from both its Nevada ($22.5 million) (US$22.8 million) and South African ($3.8 million) (ZAR27.2 million)operations. Refined precious metals are sold to Red Kite Explorer Trust under the terms of an off-take agreement. 5. SUBSEQUENT EVENTS In April 2011, the Company advanced, in accordance with the amended 2010 guarantee agreement, a further $1.6 million (ZAR11 million) to Tranter Burnstone (Pty) Ltd ("Tranter") (related party) to enable Tranter to meet its interest payment obligation to Investec Limited. The full set of financial statements and Management Discussion and Analysis are available on Great Basin`s website: www.grtbasin.com Approved by the Board of Directors Ferdi Dippenaar Ronald W Thiessen Director Director Ground Floor, 138 West Street 1500 Royal Centre, 1055 West Sandown, Johannesburg Georgia Street, South Africa Vancouver, BC Canada V6E 4N7 Tel 011 301 1800 Toll Free 1 800 667'2114 Fax 011 301 1840 www.grtbasin.com 17 May 2011 Johannesburg Sponsor Nedbank Capital Date: 17/05/2011 14:30:01 Supplied by www.sharenet.co.za 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.

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