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GGM - Goliath Gold Mining Limited - Audited abridged consolidated financial
results for the nine months ended 31 December 2011 and notice of annual
general meeting
Goliath Gold Mining Limited
(Formerly White Water Resources Limited)
Incorporated in the Republic of South Africa
(Registration number: 1933/004523/06)
Share code: GGM ISIN: ZAE000154753
("Goliath Gold" or "the company" or "the group")
AUDITED ABRIDGED CONSOLIDATED FINANCIAL RESULTS FOR THE NINE MONTHS ENDED 31
DECEMBER 2011 AND NOTICE OF ANNUAL GENERAL MEETING
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Audited Audited
9 months to 12 months to
31 December 31 March
Change 2011 2011
% R`000 R`000
Other income 182 2 082 737
Operating expenses 23 (11 021) (14 232)
Fair value adjustments (51) 4 018 8 144
Profit on sale of financial assets
2 333 8 101 333
Exploration and prefeasibility
expenditure 41 (1 039) (1 776)
Operating profit/(loss) 132 2 141 (6 794)
Finance income 92 493 257
Finance costs (100) (3) -
Profit/(Loss) before taxation 140 2 631 (6 537)
Income tax (522) (1 655) 392
Profit/(Loss) for the period 116 976 (6 145)
Other comprehensive income - - -
Total comprehensive income/(loss)
116 976 (6 145)
Profit/Loss attributable to: Owners of
the parent 976 (6 145)
Total comprehensive income/ (loss)
attributable to:
Owners of the parent 976 (6 145)
Total ordinary shares in issue 42 462 958 424 629 379
Weighted average number of ordinary
shares in issue 42 462 958 388 179 530
Earnings/(loss) per share (cents)
Headline earnings/ (loss) per share 244 2.3 (1.6)
(cents)
138 0.6 (1.6)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Audited at Audited at
31 December 31 March
2011 2011
R`000 R`000
ASSETS
Non-current assets
Investment property 3 825 3 107
Property, plant and equipment 23 17
Current assets
Other financial assets 10 813 23 515
Receivables 1 109 -
Cash and cash equivalents 32 887 8 124
Total assets 48 657 34 763
EQUITY AND LIABILITIES
Share capital 303 942 305 504
Accumulated loss (273 874) (274 850)
Equity attributable to owners of the
parent 30 068 30 654
Non-current liabilities
Deferred tax 553 -
Current liabilities
Loans from related parties 16 364 -
Trade and other payables 448 2 734
Current tax payable 1 224 122
Other financial liabilities - 1 253
Total equity and liabilities 48 657 34 763
Net asset value per share (cents) 72.5 7.4
Net tangible asset value per share
(cents) 72.5 7.4
CONSOLIDATED STATEMENT OF CASH FLOWS
Audited Audited
9 months to 12 months to
31 December 31 March
2011 2011
R`000 R`000
Cash flows from operating activities (14 067) (11 014)
Cash flows from investing activities
24 028 5 064
Cash flows from financing activities
14 802 13 015
Net cash change for the period 24 763 7 065
Cash at the beginning of the period 8 124 1 059
Net cash at the end of the period 32 887 8 124
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share Accumulated Total
capital loss equity
R`000 R`000 R`000
Balance at 01 April 2010 292 489 (268 705) 23 784
Total comprehensive loss for the - (6 145) (6 145)
period
Issue of shares 13 015 - 13 015
Balance at 01 April 2011 305 504 (274 850) 30 654
Total comprehensive income for the 9 - 976 976
months ended 31 December 2011
Share consolidation expense (1 562) - (1 562)
Balance 31 December 2011 303 942 (273 874) 30 068
COMMENTARY
1. FINANCIAL STATEMENTS - BASIS OF PREPARATION
The financial statements of Goliath Gold for the period ended 31 December
2011 ("nine month period") have been prepared in accordance with
International Financial Reporting Standards, the Companies Act of South
Africa, 2008 (Act 71 of 2008) and the JSE Listings Requirements, and are
based on appropriate accounting policies, consistently applied with those
applied in the most recent audited financial statements, which are
supported by reasonable and prudent judgements and estimates.
These results have been audited by the group`s auditors,
PricewaterhouseCoopers Incorporated, whose unqualified audit opinion is
available along with the annual report for inspection at the company`s
registered office.
2. NATURE OF THE BUSINESS
The company`s main business is that of a mining exploration company. Its
subsidiaries are primarily engaged in the resource sector.
3. FINANCIAL AND OPERATIONAL PERFORMANCE
During the nine month period, the net profit of the group was R1.0
million, compared to a group net loss for the year ended 31 March 2011 of
R6.1 million. The net profit arose mainly as a result of the profit on
sale of financial assets held for trading, fair value adjustments on
investment properties and financial assets held for trading as well as a
reduction in operating expenses since Gold One International took over
management of the group.
The basic and diluted earnings per share was 2.3 cents for the nine month
period, after taking into account the 10 for 1 share consolidation on 13
May 2011, compared to a basic and diluted loss per share of 1.6 cents for
the year ended 31 March 2011 before taking into account the share
consolidation. If the share consolidation had taken place on 31 March
2011, the basic and diluted loss per share would have been 15.7 cents.
The headline and diluted headline earnings per share was 0.6 cents for
the nine months ended 31 December 2011, after taking into account the 10
for 1 share consolidation on 13 May 2011, compared to a headline and
diluted headline loss per share of 1.6 cents for the year ended 31 March
2011. If the share consolidation had taken place at 31 March 2011, the
headline and diluted headline earnings per share would have been 15.7
cents.
Reconciliation of basic and headline earnings/ (loss)
9 months to 12 months to
31 December 31 March
2011 2011
R`000 R`000
Profit/(Loss) for the period 976 (6 145)
Gain on revaluation of investment properties
(718) -
Headline earnings/(loss) for the period
258 (6 145)
4. PROSPECTS AND FUTURE PERFORMANCE
The company has entered into an acquisition agreement in terms of which
Goliath Gold will acquire the Megamine Business of Gold One Africa
Limited ("Gold One Africa"), for an acquisition consideration of ZAR
262,229,868. This consideration will be settled by way of the issue of
104,891,947 shares of ZAR 2.50 each, known as the consideration shares,
to Gold One Africa. Subject to the fulfilment or waiver, as the case may
be, of the conditions precedent set out in the acquisition agreement, and
following the issue of the consideration shares, there will be a change
in control in Goliath Gold and Gold One Africa will thereafter hold a
controlling interest of at least 71% in Goliath Gold. This type of
transaction is classified as a reverse acquisition. In accordance with
the Companies Act and the Takeover Regulations, a mandatory offer by Gold
One Africa to the Goliath Gold shareholders to acquire all of their
shares for a consideration of one Gold One share for every 1.2 Goliath
Gold shares held was opened on 28 March 2012. Gold One International
Limited ("Gold One"), the holding company of Gold One Africa, believes
that the Megamine Business can be more effectively developed by vending
the assets into Goliath Gold. This is anticipated to result in an
unlocking of value that can be passed on to Gold One shareholders through
their retained majority interest in Goliath Gold. In addition, the
acquisition is anticipated to provide Goliath Gold shareholders with
access to a wider asset base and further management experience and
expertise in exploration, development and mining. The effective date of
the acquisition shall be five business days after the fulfilment or
waiver, as the case may be, of all conditions precedent to the
acquisition, which conditions precedent were fulfilled or waived on 19
March 2012.
5. SEGMENTAL REPORTING
Management has determined the operating segments based on the reports
reviewed by the Board that are used to make strategic decisions. The
Board considers the business from a functional perspective and has
identified two reportable segments, namely Exploration and Other
operations.
Exploration: Involved in potential mining, prospecting and exploration.
Other operations: Represents the interest received on investments.
Business Segment Information
Exploration Other operations
9 months 12 months 9 months 12 months
31 Dec 31 Mar 2011 31 Dec 2011 31 Mar 2011
2011
R`000 R`000 R`000 R`000
Segment result (1 039) (1 776) (18 910) (34 172)
Operating loss (1 039) (1 776) (18 910) (34 172)
Finance income - - 26 391 31 439
Finance costs - - (20) (26)
(Loss)/Profit (1 039) (1 776) 7 461 (2 759)
before tax
Income tax - - (1 655) 392
(expense)/credit
(Loss)/Profit for (1 039) (1 776) 5 806 (2 367)
the period
Attributable to:
Owners of the (1 039) (1 776) 5 806 (2 367)
parent
Business Segment Information (continued)
Eliminations Group
9 months 12 months 9 months 12 months
31 Dec 2011 31 Mar 2011 31 Dec 2011 31 Mar 2011
R`000 R`000 R`000 R`000
Segment result 22 090 29 154 2 141 (6 794)
Operating 22 090 29 154 2 141 (6 794)
profit/(loss)
Finance income (25 898) (31 182) 493 257
Finance costs 17 26 (3) -
(Loss)/Profit (3 791) (2 002) 2 631 (6 537)
before tax
Income tax - - (1 655) 392
(expense)/credit
(Loss)/Profit for (3 791) - 976 (6 145)
the period
Attributable to:
Owners of the (3 971) - 976 (6 145)
parent
6. SUBSEQUENT EVENTS
In the opinion of the directors, no other matter or circumstance has
arisen between 31 December 2011 and the date of this report, other than:
- One million treasury shares held by Witnigel Investments (Pty)
Limited (a wholly owned subsidiary of Goliath Gold) in Goliath Gold
were issued for cash to an unrelated third party on 27 January 2012.
These shares were sold for a consideration of ZAR 3.34 million.
- On 8 February 2012, eight prospecting rights were granted to Goliath
Gold in the district of Vredendal in the Western Cape for the
prospecting of heavy minerals and rare earths. The date of execution
is currently being arranged.
- On 19 March 2012, all outstanding conditions precedent to the
acquisition of the Megamine Business were fulfilled or waived, as
the case may be. Goliath Gold was relisted on 28 March 2012 and the
mandatory offer by Gold One Africa to the Goliath Gold shareholders
to acquire all of their shares for a consideration of one Gold One
share for every 1.2 Goliath Gold shares held, was opened on that
date. The offer remained open as at the date of release of the
integrated report.
There were no litigations which arose subsequent to the financial period.
7. DIRECTORATE
During the year under review and up to the date of this report, the
following changes in directors took place:
- The following independent non-executive directors resigned:
- Phil Lambert (26 August 2011)
- David Hodgson (12 September 2011)
- The following independent non-executive directors were appointed:
- Jerry Vilakazi (21 June 2011)
- Piet Nel (29 July 2011)
8. DIVIDENDS
In accordance with the Memorandum of Incorporation of the company,
dividends are proposed and approved by the Board, based on interim and
year-end financial performances. Payments of dividends will depend on the
Board`s ongoing assessment of Goliath Gold`s earnings, financial
position, including its cash requirements, future earnings prospects and
other relevant factors.
No dividends were declared or paid to shareholders during the current
financial year.
9. NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the annual general meeting of ordinary
shareholders of the company to be held at Constantia Office Park,
Bridgeview House, Ground Floor, Corner 14th Avenue and Hendrik Potgieter
Street, Weltevreden Park, on Wednesday, 6 June 2012, at 9am and any
adjournment thereof.
The financial statements for the nine months ended 31 December 2011,
incorporating a notice of annual general meeting, will be mailed to all
shareholders on or about 30 March 2011.
For and on behalf of the Board
Neal Froneman Christopher Chadwick
Chief Executive Officer Chief Financial Officer
Johannesburg
29 March 2011
Directors:
M Wheatley# (Chairman), K Rayner* (Deputy Chairman),
J Vilakazi*, P Nel*, N Froneman (Chief Executive Officer),
C Chadwick (Chief Financial Officer)
#Non-executive *Independent Non-executive
REGISTERED OFFICE
Empire Office Park, 55 Empire Road, Parktown, Johannesburg, 2193
COMPANY SECRETARY
Pierre Kruger
Constantia Office Park, Bridgeview House, Ground Floor, Corner 14th Avenue and
Hendrik Potgieter Street, Weltevreden Park, 1709
SPONSOR
Merchantec Capital
AUDITORS
PricewaterhouseCoopers Inc.
Date: 29/03/2012 07:05:08 Supplied by www.sharenet.co.za
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