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GDO - Gold One International Limited - Half-year report for the six months

Release Date: 30/08/2011 07:05
Code(s): GDO
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GDO - Gold One International Limited - Half-year report for the six months ended 30 June 2011 Gold One International Limited Registered in Western Australia under the Corporations Act 2001 (Cth) Registration number ACN: 094 265 756 Registered as an external company in the Republic of South Africa Registration number: 2009/000032/10 Share code on the ASX/JSE: GDO ISIN: AU000000GDO5 OTCQX International: GLDZY ("Gold One" or the "company" or the "group") HALF-YEAR REPORT FOR THE SIX MONTHS ENDED 30 JUNE 2011 Directors` Report The directors present their report on the consolidated entity consisting of Gold One and the entities it controlled for the 6 months ended 30 June 2011. 1. Directors The directors of the company during the 6 months and to the date of this report are as follows: Mark K Wheatley (Chairman)** Barry E Davison** Kenneth V Dicks** William B Harris** Sandile Swana** Kenneth J Winters** Neal J Froneman (Chief Executive Officer)* Christopher D Chadwick (Chief Financial Officer)* * - Executive director ** - Non-executive director 2. Review of operations Principal activity and nature of operations Gold One is an Australian registered and South African headquartered emerging mid-tier gold producer and developer with a pipeline of Southern African mines and projects. In addition to Gold One`s listings on the ASX and the JSE, its ADS`s are also traded in the United States of America under the ticker "GLDZY", where each ADS represents 10 ordinary shares. Its flagship operation is the newly built shallow Modder East mine on the East Rand, some 30 kilometres from Johannesburg. Modder East is the first new mine to be built in the region in 28 years and distinguishes itself from most of the other gold mines in South Africa owing to its shallow nature (300 metres to 500 metres below surface). To date Modder East has provided direct employment opportunities for over 1,500 people. The company is well on track to produce 120,000 ounces of gold for the 2011 financial year. Gold One`s business strategy is to develop precious mineral resources that are shallow, low technical risk and high margin. Currently, the company is positioned not only as the lowest cost gold producer in South Africa but also as within the lowest quartile of global gold mine production costs. Gold One also owns the nearby existing Sub Nigel mine, which is used primarily as a training centre in the build-up of Modder East to full production. Gold One`s other projects and targets include Ventersburg in the Free State Goldfields, the Tulo concession in Mozambique and the Etendeka greenfield project in Namibia. These interim financial statements report the results of the enlarged entity for the six months ended 30 June 2011 and its financial position at that date. The financial statements have been prepared for both the ASX and the JSE. The financial statements reflect the continued progress of Gold One since declaring commercial production of the Modder East mine and its pursuit of both internal growth, through existing exploration projects, and external growth, through corporate activity. The operating results and state of affairs of the group are fully set out in the attached half-year report. Operating and financial review Operating results for the six months Revenue for the 6 months is A$ 75.065 million (2010: A$ 32.587 million) and reported gross profit is A$ 38.104 million (2010: A$ 16.831 million). The profit was positively impacted by higher revenue from gold sales, reduced general and administrative expenses, lower finance costs and a positive fair value adjustment on the convertible bonds partially offset by higher exploration and pre-feasibility expenses. The group reported a profit of A$ 10.644 million compared to the loss reported for the same period last year of A$ 3.940 million. Cash balances at the end of the reporting period have more than doubled to A$ 16.602 million. Headline earnings or loss for the period is the earnings or loss for the period adjusted for gains and / or losses attributable to once-off expenses as well as capital gains or losses. The disclosure of headline earnings or loss per share is a requirement of the JSE. 2011 2010
Consolidated Headline earnings/(loss) per share 0.01 (0.01) Calculated based on: Weighted average number of fully paid 807 449 533 805 405 ordinary shares 020 Headline earnings / (loss) for the period 10 857 (3 881) (A$`000)
Reconciliation of basic earnings / (loss) and headline earnings / (loss) for the period (A$`000) Earnings / (loss) for the period 10 644 (3 940) Impairment of assets 70 74 Loss / (profit) on sale of assets 143 (15) Headline earnings / (loss) for the period 10 857 (3 881)
Share issues during the period Shares issued in respect of the Tulo acquisition (204 918 shares at ZAR2.44); Exercise of unlisted options (201 306 at ZAR1.35; 54 500 at ZAR1,74; 78 668 at ZAR1.93; 59 600 at ZAR2.04; 112 846 at ZAR2.12; 31 515 at ZAR2.44; 31 515 at ZAR2.79; 150 000 at A$0.22; 600 000 at A$0.27); Shares issued to bond holder (314 026 at USD0.38) and Exercise of listed options (1 850 at A$0.50) 3. Issued share capital At 30 June 2011, Gold One International Limited had 808 716 731 (2010: 805 894 985) fully paid ordinary shares in issue. The shares carry one vote per share and the right to dividends. 4. Dividends No dividends were declared or paid to shareholders during the 6 months. 5. Highlights and events after the reporting period During the last quarter of 2010, Gold One announced the proposed creation of Goliath Gold Mining Limited ("Goliath Gold") through the disposal of Gold One Africa Limited`s ("Gold One Africa") Megamine business to Goliath Gold (previously White Water Resources Limited) for ZAR 262 million, to be paid in Goliath Gold shares. The Goliath Gold transaction is progressing well with Goliath Gold shareholders having approved the transaction on 22 March, 2011. The remaining conditions precedent are in the process of being fulfilled during the third quarter of 2011. The second quarter of 2011 saw an announcement by Gold One that it had signed a sale of shares agreement to acquire 100% of Rand Uranium (Proprietary) Limited ("Rand Uranium"). Gold One has been granted an unconditional approval for the transaction by the South African Competition Commission. The transaction will only be completed once the remaining conditions precedent have been fulfilled. Gold One announced during May 2011 that it had entered into an agreement to implement a transaction with a consortium of Chinese investors (the "Consortium") whereby the Consortium is seeking to become the major shareholder and long term strategic partner of Gold One through both a takeover offer and subscriptions of shares for cash. The takeover offer and subscriptions by the Consortium are progressing well. The notice of meeting and explanatory memorandum regarding the subscriptions, which incorporates the independent expert`s report, the bidder`s statement and the target`s statement regarding the takeover offer was issued in August 2011; this issue triggered the opening of the offer. Gold One has also been granted an unconditional approval for the offer by the South African Competition Commission. A general meeting of Gold One shareholders will be held on 7 September 2011 to approve the subscriptions. Other conditions precedent are also underway. Independent of the takeover and subscriptions transaction, the Consortium, through a subsidiary of one of its members, acquired the 142 689 350 Gold One shares previously held by Navada Trading Pty Ltd, a subsidiary of African Global Capital (SA) (Proprietary) Limited. 6. Additional disclosures The additional information can be found in the notes to the half-year financial statements. These disclosures have been included to provide a true and fair view of the company`s financial performance and position as required by the Corporations Act 2001. 7. Auditors PricewaterhouseCoopers continues in office in accordance with section 327 of the Corporations Act 2001. 8. Auditor`s independence declaration A copy of the auditor`s independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 8 of the annual report available on www.gold1.co.za 9. Other matters The company is of a kind referred to in Class Order 98/100, issued by the Australian Securities and Investments Commission, relating to the "rounding off" of amounts in the directors` report and financial report. Amounts in the directors` report and financial report have been rounded off to the nearest thousand dollars in accordance with the Class Order or in certain cases, the nearest dollar. This report is made in accordance with a resolution of directors. The half-year report set out on pages 5 to 23, which has been prepared on the going concern basis, was approved by the Board on 30 August 2011 and was signed on its behalf by: Signed: Neal J Froneman (Chief Executive Officer) Signed: Christopher D Chadwick (Chief Financial Officer) Johannesburg, South Africa 30 August 2011 QUOTE Auditor`s Independence Declaration As lead auditor for the audit of Gold One for the half year ended 30 June 2011,I declare that to the best of my knowledge and belief, there have been: a) no contraventions of the auditor independence requirements of the Corporations Act 2011 in relation to the audit; and b) no contraventions of any applicable code of professional conduct in relation to the audit. This declaration is in respect of Gold One during the half year. PricewaterhouseCoopers Signed Marc Upcroft Chartered Accountant Registered Auditor Partner Sydney 30 August 2011 Darling Park Tower 2 201 Sussex Street Sydney NSW 2000 UNQUOTE CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE SIX MONTHS ENDED 30 JUNE 2011 6 months 6 months ended 30 ended 30 June 2011 June 2010
Note A$`000 A$`000 Revenue from gold sales 75 065 32 587 Cost of sales (36 961) (15 756) Gross profit 38 104 16 831 Other income 128 136 General and administrative expenses (8 059) (12 486) Fair value adjustment on financial liability 4 2 515 (5 183) Share based payment expense (1 664) (1 354) Exploration and pre-feasibility expenditure (4 540) (1 477) Impairment of assets (70) (74) (Loss) / profit on sale of assets (143) 15 Gain on foreign exchange transactions - 393 Operating profit / (loss) before finance costs 26 271 (3 199) Finance costs (2 479) (3 184) Finance income 391 316 Profit/ (loss) before income tax 24 183 (6 067) Income tax expense 6 (13 539) 2 127 Profit / (loss) for the period 10 644 (3 940) Other comprehensive income, net of tax: Currency translation differences on foreign (6 815) 771 operations Total comprehensive income / (loss) 3 829 (3 169)
Profit/ (loss) for the six months attributable to: Owners of the parent 10 644 (3 940)
Total comprehensive income / (loss) for the six months attributable to: Owners of the parent 3 829 (3 169) Earnings / (loss) per share: Basic earnings / (loss) per share 0.01 (0.01) Diluted earnings / (loss) per share 0.01 (0.01) Number of shares in issue 808 716 731 805 894 985
Reconciliation of weighted and diluted average number of shares: Average number shares 807 449 833 805 405 020 Unexercised share options 78 378 126 45 913 077 Convertible bonds potentially convertible 157 013 158 157 327 184 1 042 841 117 1 008 645 281 The above consolidated statement of comprehensive income should be read in conjunction with the accompanying notes set out in the annual report available on www.gold1.co.za CONSOLIDATED STATEMENT OF FINANCIAL POSITIONS FOR THE SIX MONTHS ENDED 30 JUNE 2011 30 June 31
2011 December 2010 Note A$`000 A$`000 ASSETS Current Assets Cash and cash equivalents 7 16 602 4 501 Trade and other receivables 12 303 9 470 Inventories 4 044 2 313 Taxation receivable 269 286 33 218 16 570 Non-current Assets Receivables 18 18 Held-to-maturity investments 1 455 1 518 Property, plant and equipment 8 157 886 160 173 Deferred tax assets 4 487 4 802 163 846 166 511
Total Assets 197 064 183 081 LIABILITIES
Current Liabilities Trade and other payables 13 872 12 181 Employee related payable 2 604 2 031 16 476 14 212
Non-current Liabilities Financial liabilities designated at fair value 4 59 708 66 593 Deferred tax liability 22 213 9 553 Provisions 3 155 3 268 85 076 79 414 Total Liabilities 101 552 93 626 NET ASSETS 95 512 89455 EQUITY Contributed Equity 9 131 346 130 782 Reserves (7 452) (2 301) Accumulated loss (28 382) (39 026) Capital and reserves attributable to owners of 95 512 89 455 Gold One
Total Equity 95 512 89 455 The above consolidated statement of financial position should be read in conjunction with the accompanying notes set out in the annual report available on www.gold1.co.za CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE SIX MONTHS ENDED 30 JUNE 2011 Contributed Reserves Accumulated Total Equity Loss Equity
A$`000 A$`000 A$`000 A$`000 Balance at 01 January 2010 130 215 (3 728) (53 619) 72 868 Total comprehensive loss for - 771 (3 940) (3 the six months 169) Shares issued net of 73 - - 73 transaction costs Employee share options 214 1 379 - 1 593 Total changes 287 2 150 (3 940) (1 503) Balance at 30 June 2010 130 502 (1 578) (57 559) 71 365 Balance at 01 January 2011 130 782 (2 301) (39 026) 89 455 Total comprehensive income - (6 815) 10 644 3 829 for the six months Shares issued net of 183 - - 183 transaction cost Employee share options 381 1 664 - 2 045 Total changes 564 (5 151) 10 644 6 057 Balance as at 30 June 2011 131 346 (7 452) (28 382) 95 512 The above consolidated statement of changes in equity should be read in conjunction with the accompanying notes set out in the annual report available on www.gold1.co.za CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE SIX MONTHS ENDED 30 JUNE 2011 6 Months 6 Months
ended 30 ended 30 June June 2011 2010 Note A$`000 A$`000
Cash flows from operating activities Receipts from customers 71 557 29 925 Cash paid to suppliers and employees (33 747) (15 841) Cash generated from/ (used by) operations 37 810 14 084 Finance income 391 316 Finance costs (2 256) (2 930) Income taxes paid (267) (392) Net cash inflow/ outflow from operating 35 678 11 078 activities Cash flows from investing activities Payments for property, plant and equipment (17 661) (16 068) Proceeds from sale of property, plant and - 1 240 equipment Net cash outflow from investing activities (17 661) (14 828) Cash flows from financing activities Proceeds from issue of shares net of transaction 9 564 286 costs Repayment of financial liabilities designated at - (4 695) fair value Net cash (outflow)/ inflow from financing 564 (4 409) activities Net increase / (decrease) in cash and cash 12 801 (8 159) equivalents Cash at beginning of the financial year 4 501 15 268 Effects of exchange rate changes on cash and cash (700) (75) equivalents Cash and cash equivalents at end of year 7 16 602 7 034 The above consolidated statement of cash flows should be read in conjunction with the accompanying notes set out in the annual report available on www.gold1.co.za NOTES TO THE FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 30 JUNE 2011 Accounting Policies 1. Corporate information The financial report of Gold One International Limited ("Gold One") for the half-year ended 30 June 2011 was authorised for issue in accordance with a resolution of the directors on 30 August 2011. Gold One is a company incorporated in Australia and limited by shares, which are publicly traded on the Australian Stock Exchange and the Johannesburg Stock Exchange. The nature of the operations and principal activities of the group are described in the Directors` Report. 2. Summary of significant accounting policies Basis of preparation This general purpose interim financial report, for the half year reporting period ending 30 June 2011, has been prepared in accordance with AASB 134 Interim Financial Reporting and the Corporations Act 2001. The half-year financial report does not include all notes of the type normally included within the annual financial report. Accordingly this report should be read in conjunction with the consolidated financial statements for the year ended 31 December 2010, as it provides an update of previously reported information. It is also recommended that the half-year financial report be considered together with any public announcements made by Gold One and its controlled entities during the half-year ended 30 June 2011 in accordance with the continuous disclosure obligations arising under the Corporations Act 2001. For the purpose of preparing this report, the half-year has been treated as a discrete reporting period. The accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period. Principles of consolidation Functional and presentation currency Items included in the financial statements of each entity in the group are measured using the currency that best reflects the economic substance of the underlying events and circumstances relevant to that entity ("the functional currency"). The consolidated financial statements are presented in Australian Dollars ("AUD"), which is the group`s presentation currency. The functional currency of the company and its subsidiaries is the South African Rand ("ZAR"). Impact of standards issued, but not yet applied AASB 9 Financial Instruments, AASB 2009-11 Amendments to Australian Accounting Standards arising from AASB 9 and AASB 2010-7 Amendments to Australian Accounting Standards arising from AASB 9 (December 2010) (effective from 1 January 2013). AASB 9 Financial Instruments addresses the classification, measurement and derecognition of financial assets and financial liabilities. The standard is not applicable until 1 January 2013 but is available for early adoption. When adopted, the standard will affect in particular the group`s accounting for its available-forsale financial assets, since AASB 9 only permits the recognition of fair value gains and losses in other comprehensive income if they relate to equity investment that are not held for trading. There will be an impact on the group`s accounting for financial liabilities, as the new requirements affect the accounting for financial liabilities that are designated at fair value through profit or loss. The derecognition rules have been transferred from AASB 139 Financial Instruments: Recognition and Measurement and have not been charged. The group has not yet decided when to adopt AASB 9. 3. Segment information Description of segments Management has determined the operating segments based on the reports reviewed by the Executive Committee that are used to make strategic decisions. The committee considers the business from both a functional and a geographic perspective and has identified three reportable segments: Corporate, which consists of corporate and administrative activities; South African Operations, which consists of the extraction of and processing of gold ore into fine gold; and Projects, which consists of the exploration and feasibility of the group`s properties. Segment information provided to the Executive Committee: 30 June 2011 30 June 2010 Corpora South Project Consol Corpora South Project Consoli te Africa s idated te African s dated n operati
operat ons ions A$`000 A$`000 A$`000 A$`000 A$`000 A$`000 A$`000 A$`000 Segment revenue Sales - 75 065 - 75 065 - 32 587 - 32 587 to externa l custome rs
Segment results (Loss) (9 215) 37 258 (3 860) 24 183 (12 7 628 (1 353) (6 067) / 342) profit for the half year Income - (13 - (13 - 2 127 - 2 127 taxes 539) 539) Total 10 644 (3 940) 30 June 2011 30 June 2010 Corpora South Project Conso Corpora South Project Consol te Africa s lidat te Africa s idated n ed n operat operat
ions ions A$`000 A$`000 A$`000 A$`00 A$`000 A$`000 A$`000 A$`000 0 Segment assets and liabili ties Segment 17 563 176 3 270 197 (3 031) 182 3 443 183 assets 231 064 669 081 Segment (62 (41 2 281 (101 (69 (23 (486) (93 liabili 312) 521) 552) 993) 147) 626) ties Net 95 89 455 assets 512 *Corporate refers to Gold One`s corporate offices in Australia and South Africa, South African Operations refer to Gold One`s operating mines, Modder East and Sub Nigel, in South Africa and Projects refer to the various exploration entities. The reported measure of assets and liabilities excludes inter-company assets and liabilities. Corporate assets consist mainly of cash and cash equivalents managed centrally for the other segments. 30 June 30 June 2011 2010
A$`000 A$`000 4. Financial liabilities designated at fair value Fair value of convertible bonds 59 708 66 593 Financial liabilities consist of convertible bonds classified as financial liabilities at fair value through profit and loss Non-current liabilities at the end of the period Convertible bonds 59 708 66 592 Reconciliation of convertible bond Opening balance 66 593 80 293 Interest accrued on bonds 223 254 Repurchase of bond - (4 695) Conversion of bond to equity (112) - Fair value adjustment (2 515) (9 259) Effect of foreign currency translation (4 481) - 59 708 66 593 In 2007, 600 8.5% convertible bonds were issued by Aflease Gold Limited at a nominal value of R1 million per bond. As a result of the reverse acquisition arrangement in 2009 whereby Aflease Gold Limited was acquired by Gold One, the original bonds issued were replaced on 25 May 2009 with 600 8.5% convertible bonds at a total nominal value of US$ 71.598 million. The bonds mature in December 2012, 5 years from the original issue date at the redemption value of 109.6% of the nominal value unless converted into the group`s ordinary shares at the holder`s option, at any time during the conversion period. All or some of the bonds can be converted at a fixed rate of 314,026 shares per bond. At any time on or after 12 December 2009 the group may redeem all, but not some only, of the bonds for the time being outstanding at their accreted principal amount, which represents on the relevant date a gross yield to maturity identical to that applicable in the case of redemption on the maturity date, together with interest accrued to the date fixed for redemption. This option is exercisable only if the market value of the ordinary shares has accreted by more than 150% of the conversion price. 99 bonds have been repurchased to date after the bondholders had approved a partial buyback, and 1 bond was exercised and converted to equity during the current period. In addition, the group has the option to redeem all the bonds, and not some only, at any time, at their accreted principal amount together with interest accrued to the date fixed for redemption, if 85% or more of the originally issued bonds have been exercised and / or purchased and cancelled. The bondholders had the option to put the bonds to the group at the accreted principal plus accrued interest on 12 December 2010, being the third anniversary of the closing date. The bondholders elected not to exercise their put option, and as a result the liability was reclassified as non-current with a maturity date of 12 December 2012. The terms and conditions of the bonds remain otherwise unchanged. 4. Financial liabilities designated at fair value (continued) The following debt covenants apply to the convertible bonds: Gold One may not create or allow any additional indebtedness in relation to the Modder East project; Gold One may not create or allow any additional indebtedness in relation to any other project unless such indebtedness complies with the applicable earnings restriction and debt / equity ratio; Gold One is not permitted to sell or dispose of any key assets without the consent of the bondholders; and Gold One is not permitted to sell any other assets other than on arms length and commercially reasonable terms. The accreted principal value of the bonds is US$ 63.361 million (31 December 2010: US$ 62.877 million). The maximum undiscounted contractual amount for which the bondholders could call the bonds at the maturity date is US$ 65.511 million and the fair value, as provided by the external valuators, of the convertible bonds at 30 June 2011 is US$ 63.961 million (31 December 2010: US$ 68.098 million). 5. Financial risk management The group`s principal financial instruments comprise short-term deposits and the convertible bonds. The main purpose of the convertible bonds was to provide funding for the development of the Modder East Operations. Surplus funds are currently invested in short term deposits to be utilised by the operations and to fund the growth of the group. The group has various other financial assets and liabilities such as trade receivables and trade payables, which arise directly from its operations. No derivative transactions have been entered into. It is, and has been throughout the period under review, the group`s policy that no trading in financial instruments shall be undertaken. The main risk arising from the group`s financial instruments is the liquidity risk. The board reviews and approves policies for managing the risk and it is summarised below. Liquidity risk Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, the availability of funding through an adequate amount of committed credit facilities and the ability to close out market positions. The group manages liquidity risk by continuously monitoring forecasts and actual cash flows and matching the maturity profiles of financial assets and liabilities. Surplus funds are generally only invested in instruments that are tradable in highly liquid markets. Financing arrangements At 30 June 2011 Gold One had a ZAR 9 665 000 unsecured, undrawn borrowing facility. Maturity of financial liabilities At 30 June 2011 Less than 6 - 12 Between 1 Total 6 months months and 2 years
A$`000 A$`000 A$`000 A$`000 Financial liabilities - - 61 831 61 831 designated at fair value Trade and other payables 16 476 - - 16 476 16 476 - 61 831 78 307 At 30 June 2010 Less than 6 - 12 Between 1 Total 6 months months and 2 years
A$`000 A$`000 A$`000 A$`000 Financial liabilities - - 63 864 63 864 designated at fair value Trade and other payables 14 212 - - 14 212 14 212 - 63 864 78 076 30 June 30 June 2011 2010 A$`000 A$`000
6. Taxation Major components of the tax expense Republic of South Africa Local - Current South African income tax - current period (267) (197) Deferred income tax Originating and reversing temporary differences (13 272) 2 324 (13 539) 2 127
30 June 30 June 2011 2010 A$`000 A$`000
7. Cash and cash equivalents Cash on hand 305 397 Restricted cash* 1 216 1 316 Short-term deposits 15 081 2 788 16 602 4 501 * Restricted cash at 30 June 2011 refers to cash balances in lieu of guarantees provided, as detailed in note 10, and funds in the New Kleinfontein Rehabilitation Trust. 8. Property, plant and equipment Additions to the group`s property, plant and equipment amounted to A$ 17.661 million (30 June 2010: A$ 16.068 million) and were primarily attributable to the Modder East mine to cater for the increase in production levels. All the equipment was acquired for cash. 30 June 30 June 2011 2010 A$`000 A$`000
9. Contributed equity Issued 808 716 731 (31 December 2010: 806 875 987) Ordinary 131 346 130 782 Shares Fully paid ordinary shares carry one vote per share and carry the right to dividends.
Movement in ordinary shares on issue A$ Number of shares At 31 December 2009 130 215 804 966 414 816
Issued on 11 January 2010 in respect of the Tulo 73 300 220 357 acquisition Transaction costs on share issue (123) - Issued on 25 January 2010 for cash on exercise of 16 473 52 225 share options Issued on 27 January 2010 1 - Transaction costs on share issue (123) - Issued on 11 March 2010 for cash on exercise of 277 542 share options Transaction costs on share issue (126) - Issued on 6 May 2010 for cash on exercise of share 46 585 207 895 options Transaction costs on share issue (126) - Issued on 10 May 2010 for cash on exercise of share 102 275 300 000 options Transaction costs on share issue (126) - Issued on 17 May 2010 for cash on exercise of share 29 659 147 150 options Transaction costs on share issue (126) - Issued on 6 July 2010 in respect of the Tulo 75 200 267 550 acquisition Transaction costs on share issue (130) - Issued on 14 July 2010 for cash on exercise of share 21 481 105 798 options Transaction costs on share issue (127) - Issued on 27 October 2010 for cash on exercise of 13 360 39 334 share options Transaction costs on share issue (657) - Issued on 25 November 2010 - share option exercise 189 601 568 320 Transaction costs on share issue (122) - At 31 December 2010 130 781 806 875 840 987
Issued on 11 January 2011 in respect of the Tulo 73 808 204 918 acquisition Transaction costs on share issue (133) - Issued on 2 March 2011 - share option exercise 204 408 Transaction costs on share issue (127) - Issued on 14 March 2011 - share option exercise 24 149 67 852 Transaction costs on share issue (130) - Issued on 14 March 2011 - share option exercise 33 000 150 000 Transaction costs on share issue (130) - Issued on 8 April 2011 - share option exercise 75 150 Transaction costs on share issue (129) - Issued on 18 April - share option exercise 2 575 51 091 Transaction costs on share issue (126) - Issued on 6 May 2011 - bond exercise 111 671 314 026 Transaction costs on share issue (664) - Issued on 9 May 2011 - share option exercise 150 300 Transaction costs on share issue (126) - Issued on 6 June 2011 - share option exercise 163 000 600 002 Transaction costs on share issue (126) - Issued on 6 June 2011 - share option exercise 98 474 334 267 Transaction costs on share issue (126) - Issued on 13 June 2011 - share option exercise 58 149 117 730 Transaction costs on share issue (126) - At 30 June 2011 131 346 808 716 152 731 30 June 30 June 2011 2010 A$`000 A$`000
10. Commitments Guarantees, capital and operating lease commitments Guarantees 1 074 1 199 Capital commitments 7 197 11 024 Operating lease commitments 810 1 797 9 081 14 020 Guarantees Environmental rehabilitation of land Performance bank guarantees with Department of 181 213 Mineral Resources Performance guarantee - Eskom 893 986 1 074 1 199
The guarantees relate to performance bank and insurance guarantees with the Department of Mineral Resources for the environmental rehabilitation of land, as well as performance guarantees with Eskom for energy. Capital commitments The capital commitments relate to capital expenditure commitments contracted at balance sheet date. The capital commitments will be funded from Gold One`s own cash resources. Operating leases - as lessee (expense) The future aggregate minimum lease payment under non- cancellable operating leases are: within one year 100 667 in second to fifth year inclusive 303 654 later than five years 407 476 810 1 797
The operating lease commitments relate to the leases for the farm Cloverfield, Parktown offices and Australia offices. No contingent rent is payable. 11. Contingencies Grinaker-LTA Mining At the beginning of August 2009, a dispute was declared between New Kleinfontein Goldmine (Proprietary) Limited ("NKGM"), a wholly-owned subsidiary of Gold One, and Grinaker-LTA Mining Contracting, a business unit of Aveng (Africa) Limited ("Grinaker"), regarding a claim by Grinaker for payment of the sum of A$ 3.707 million under the Contract Works Agreement for the sinking of the vertical shaft at Modder East. The dispute was referred to arbitration in August 2009 on the basis that Grinaker completes the sinking of the vertical shaft and NKGM pays the sum of A$ 3.707 million into trust pending the arbitrator`s ruling. NKGM duly paid the sum of A$ 3.707 million into trust and Grinaker has in the interim completed the sinking of the vertical shaft, the erection of the headgear and the commissioning of the winder. Furthermore, Grinaker is claiming an additional A$ 1.529 million over and above the amount held in the trust bringing the total claim to A$ 5.236 million. Gold One is refuting the full amount of the claim. NKGM contends that: The contract was for a fixed price, plus escalation in accordance with the contract price adjustment formula and agreed variations; Grinaker was unable to achieve the sinking rate as per the construction program and as a consequence was not able to complete the shaft within the prescribed period; and The additional costs incurred by Grinaker as a result of it not completing the shaft within the prescribed period are for its own account. NKGM does not admit being indebted to Grinaker in the sum of A$ 3.707 million. In addition, the A$ 3.707 million was not paid into trust as a tender or admission of liability, but solely in terms of the arbitrator`s directive. The arbitration is ongoing and no date has been fixed for a hearing. In the event of an unfavourable outcome in the arbitration process, the cash balance of the Group will be reduced by a settlement amount to be determined by the arbitration process. The funds have been deposited in the solicitor`s trust account until such time the arbitration process is complete and the dispute is resolved. The funds are included as part of trade and other receivables at A$ 3.707 million. 12. Related parties ` Relationships Directors Refer to directors` report - note 1 Ultimate holding company Gold One International Limited Subsidiaries Gold One Africa Limited Twin Hills Operations (Pty) Limited Australian Silicon Operations (Proprietary) Limited Gold One Mozambique Lda Etendeka Prospecting and Mining Company (Proprietary) Limited New Kleinfontein Company Limited New Kleinfontein Goldmine (Proprietary) Limited New Kleinfontein Gold Claims (Proprietary) Limited New Kleinfontein Rehabilitation Trust Gold One International Limited Share Incentive Scheme Other Goliath Gold Mining Limited 13. Events after the reporting period During the last quarter of 2010, Gold One announced the proposed creation of Goliath Gold Mining Limited ("Goliath Gold") through the disposal of Gold One Africa Limited`s ("Gold One Africa") Megamine business to Goliath Gold (previously WWR) for ZAR 262 million, to be paid in Goliath Gold shares. The Goliath Gold transaction is progressing well with Goliath Gold shareholders having approved the transaction on 22 March 2011. The remaining conditions precedent are in the process of being fulfilled during the third quarter of 2011. The second quarter of 2011 saw an announcement by Gold One, that it had signed a sale of shares agreement to acquire 100% of Rand Uranium (Proprietary) Limited ("Rand Uranium"). Gold One has been granted an unconditional approval for the transaction by the South African Competition Commission. The transaction will only be completed once the remaining conditions precedent have been fulfilled. Gold One announced during May 2011 that it had entered into an agreement to implement a transaction with a consortium of Chinese investors (the "Consortium") whereby the Consortium is seeking to become the major shareholder and long term strategic partner of Gold One through both a takeover offer and subscription of shares for cash. The takeover offer and subscription by the Consortium are progressing well. The notice of meeting and explanatory memorandum regarding the subscriptions, which incorporates the independent expert`s report, the bidder`s statement and the target`s statement regarding the takeover offer was issued in August 2011; this issue triggered the opening of the offer. Gold One has also been granted an unconditional approval for the offer by the South African Competition Commission. A general meeting of Gold One shareholders will be held on 7 September 2011 to approve the subscription. Other conditions precedent are also underway. Independent of the takeover and subscription transaction, the Consortium, through a subsidiary of one of its members, acquired the 142 689 350 Gold One shares previously held by Navada Trading Pty Ltd, a subsidiary of African Global Capital (SA) (Proprietary) Limited. Directors Declaration In accordance with a resolution of the directors of Gold One International Limited, I state that: (A) the financial statements and notes of the consolidated entity are in accordance with the Corporations Act 2001, including: (i)give a true and fair view of the financial position as at 30 June 2011 and the performance for the halfyear ended on that date of the consolidated entity; and (ii)comply with Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations 2001; and (B)there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable. This declaration is in respect of Gold One International Limited and the entities it controlled during the period. On behalf of the Board Signed Neal Froneman (Chief Executive Officer) Christopher Chadwick (Chief Financial Officer) 30 August 2011 Johannesburg, South Africa The half year report for the six month ended 30 June 2011 have been reviewed by Pricewaterhousecoppers Inc. Whose unqualified independent review report is available for inspection at the registered office of Gold One A copy of the full half year report is available on the company`s website hosted at www.gold1.co.za On behalf of the Board Neal Froneman Christopher Chadwick Chief Executive Officer Chief Financial Officer 30 August 2011 Johannesburg, South Africa JSE SPONSOR Macquarie First South Capital (Pty) Limited CORPORATE DIRECTORY Australia South Africa
Registration ABN 35 094 265 746 2009/000032/10 Number Registered Level 3 First Floor, 45 Empire Road Office 100 Mount Street Parktown North Sydney NSW 2060 Gauteng 2193 Telephone: +612 9963 6400 Telephone: + 27 11 726 1047 Facsimile: +612 9963 6499 Facsimile: + 27 11 726 1087
Board of Non-Executive Directors Directors Mark K Wheatley (Chairman) Barry E Davison
Kenneth V Dicks William B Harris Sandile Swana Kenneth J Winters
Executive Directors Neal J Froneman (Chief Executive Officer) Christopher D Chadwick (Chief Financial Officer)
Secretaries Kellie M Pickering Pierre B Kruger Auditors PricewaterhouseCoopers Darling Park Tower 2
201 Sussex Street Sydney NSW 2000 Share Boardroom (Proprietary) Computershare Investor Registries Limited Services (Proprietary) Limited 28 Margaret Street 70 Marshall Street Sydney NSW 2000 Johannesburg 2001 Telephone: +612 9290 9600 Telephone: +27 11 370 5000
Facsimile: +612 9279 0664 Facsimile: +27 11 370 5220 Solicitors Blake Dawson Edward Nathan Sonnenbergs 2 The Esplanade 1 North Wharf Square Perth WA 6000 Loop Street Foreshore Cape Town 8001
Bankers Commonwealth Bank of ABSA Bank Limited Australia Corporate Banking Institutional Banking 15 Alice Lane
Level 22, Darling Park Sandton Tower 1 2196 201 Sussex Street Sydney NSW 2000
Stock Primary Listing Secondary Listing Exchange Australian Securities JSE Limited ("JSE") Listings Exchange One Exchange Square ASX Limited ("ASX") Gwen Lane, Sandton 2196 20 Bridge Street Ticker: GDO Sydney NSW 2000
Ticker: GDO American OTCQX International Depository Ticker: GLDZY Receipts Level 1 ADR Sponsor ("ADRs") The Bank of New York Mellon Depository Receipts Division 101 Barclay Street, 22nd Floor
New York 102386 USA Website www.gold1.co.za Address Other key The other key management personnel of the Group are those management that report directly to the executive directors of the personnel company being: Izak J Marais (Senior Vice President: Operations)
Sydney JM Caddy (Senior Vice President: Operations) Richard A Steward (Senior Vice President: Business Development) Pierre B Kruger (Senior Vice President: General Counsel
and Company Secretary) Website www.gold1.co.za address Date: 30/08/2011 07:05:53 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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