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Interim Results for the Six Months Ended 30 June 2013
African Eagle Resources plc
Incorporated in England and Wales
(Registration number 3912362)
(AIM share code: AFE AIM ISIN: GB0003394813)
(JSE share code: AEA JSE ISIN: GB0003394813)
(“African Eagle” or the “Company”)
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2013
African Eagle (AIM: AFE; AltX: AEA) today announces its interim results for the six months ended 30 June 2013,
which will also be available shortly on the Company's website: www.africaneagle.co.uk.
MANAGING DIRECTOR’S STATEMENT
Dear Shareholder,
2013 has proved a challenging year for your Company, in a particularly depressed market for mining juniors. It is
unfortunate that the significant progress made on the Dutwa nickel project during 2012 has been unable to be
replicated in 2013, as described in the Chairman’s Statement of the 2012 Annual Report.
To this end, and as noted in the Annual Report, your Board of Directors decided to progress three initiatives in
early 2013:
- To continue to seek a purchaser for the Dutwa assets, with the consideration being in cash and/or a carried
interest;
- To recover any value possible from the Miyabi JV and other non-Dutwa assets via a sale of our interest for
cash or equity; and
- To maintain the AIM-listed plc with a view to seeking new investment opportunities in the natural resources
and related sectors, thereby retaining a possibility of securing some upside for shareholders.
The successful completion of the sale of 90% of the Tanzanian assets to Blackdown Resources (UK) Limited,
including a carried interest for the retained 10%, and the appointment of three new directors with significant
experience in capital raising, focusing on natural resources, (both occurring during August 2013) give grounds for
cautious optimism that your Company has a brighter future. There can be no guarantee, however, that any new
investment opportunities, if identified and executed, will be successful.
Concurrent with these initiatives, significant and successful efforts have been made to reduce costs at the
corporate level.
The Company announced on 22 July 2013 that, including the proceeds from the sale of the Tanzanian assets,
there was sufficient working capital for two months. Efforts to improve the working capital balance are being
progressed and potential sources of funds include, but are not limited to, the sale of assets, a loan, a placing of
shares or a combination of some or all of these.
As previously announced, David Newbold resigned as a director on 1 April 2013, Trevor Moss resigned on 28 June
2013 and Chris Pointon, Don Newport and Ambassador Paul Rupia all stepped down from the Board on 14 August
2013. As also announced, I was appointed to the Board on 24 June 2013 as Interim Managing Director and
Venkat Siva, Paul Colucci and Mark Thompson were appointed on 14 August 2013 as Non-Executive Directors.
On behalf of the current Board of Directors, I would like to thank the former Directors for their hard work and
dedication during these difficult times. I would also like to thank the significant contributions made by the staff in
both Tanzania and London, without which the transaction with Blackdown Resources (UK) Limited would not have
been possible.
As at 30 June 2013 the transaction to sell the Tanzanian assets had not been executed and therefore these
interim results have been prepared for the Group on a break up basis, consistent with the 2012 Accounts.
However, the comparative figures for the six months ended 30 June 2012 were prepared on the going concern
basis and these have not been restated to break up basis.
Robert McLearon
Managing Director
For further information, please visit www.africaneagle.co.uk or contact:
African Eagle Resources plc
Robert McLearon, Managing Director
+44 20 7248 6059
Strand Hanson Limited (NOMAD)
Stuart Faulkner
Angela Hallett
James Dance
+ 44 20 7409 3494
Ocean Equities Limited (Broker)
Guy Wilkes
+44 20 7786 4370
JSE Sponsor
Merchantec Capital
10 September 2013
African Eagle Resources Plc
Condensed Interim Consolidated Statement of Comprehensive Income
For the six months ended 30 June 2013
6 months to 6 months to Year to
30 June 30 June 31 December
2013 2012 2012
Note Unaudited Reviewed Audited
£ £ £
Employee benefits expense (248,111) (612,294) (1,649,651)
Impairment of assets 3 (1,693,680) (2,810,952) (25,366,967)
Other expenses (1,045,833) (1,030,056) (1,549,362)
Depreciation expense - (22,255) (46,670)
Profit on sale of licences - 212,291 -
Profit on disposal of assets held for sale - - 327,132
Share of loss in associates and assets held for sale - - (11,806)
Other income 4 24,682 2,142 -
Payroll levies related to prior years (78,153) - (601,754)
Operating loss (3,041,095) (4,261,124) (28,899,078)
Finance income:
Bank interest receivable 19,764 45,121 108,464
Foreign exchange gain/(loss) 98,502 (135,784) (145,120)
Loss before tax (2,922,829) (4,351,787) (28,935,734)
Income tax expense - - -
Loss attributable to equity owners for the period (2,922,829) (4,351,787) (28,935,734)
Other comprehensive loss:
Exchange differences on translation of foreign operations (38,917) (284,402) (799,667)
Available for sale investments: fair value adjustment - 40,000 (40,000)
Other comprehensive loss for the period (38,917) (244,402) (839,667)
Total comprehensive loss attributable to equity owners for the (2,961,746) (4,596,189) (29,775,401)
period
Loss per share:
Basic/diluted loss per share from total and continuing operations 5 (0.4p) (0.8p) (4.7p)
Headline/diluted loss per share from total and continuing 5 (0.2p) (0.3p) (0.6p)
operations
The accompanying notes form an integral part of these condensed interim consolidated financial statements.
African Eagle Resources Plc
Condensed Interim Consolidated Statement of Financial Position
As at 30 June 2013
30 June 30 June 31 December
2013 2012 2012
Unaudited Reviewed Audited
Note £ £ £
Assets
Deferred exploration costs - 14,658,103 -
Property, plant and equipment - 171,321 -
Available for sale investments 6 18,667 200,000 68,000
Exploration assets held for sale - 2,275,281 -
Investment in associates - - -
Investment in joint ventures - - -
Cash and cash equivalents 614,609 10,595,202 3,645,458
Other receivables 94,863 640,791 241,233
Total assets 728,139 28,540,698 3,954,691
LIABILITIES
Current liabilities
Payroll related levies related to prior years (679,907) - (601,754)
Other payables (1,229,046) (1,751,199) (1,656,375)
Total liabilities (1,908,953) (1,751,199) (2,258,129)
Net (liabilities)/assets (1,180,814) 26,789,499 1,696,562
EQUITY
Equity attributable to owners of the parent:
Share capital 6,940,145 6,940,145 6,940,145
Share premium account 36,559,743 36,559,743 36,559,743
Merger reserve 405,723 705,723 405,723
Available for sale revaluation reserve - 80,000 -
Foreign currency reserve (1,028,851) (474,668) (989,933)
Retained losses (44,057,574) (17,021,444) (41,219,116)
Total equity (1,180,814) 26,789,499 1,696,562
The accompanying notes form an integral part of these condensed interim consolidated financial statements.
African Eagle Resources Plc
Condensed Interim Consolidated Statement of Cash Flows
For the six months ended 30 June 2013
6 months to 6 months to Year to
30 June 30 June 31 December
2013 2012 2012
Unaudited Reviewed Audited
£ £ £
Operating activities
Loss before taxation (2,922,829) (4,351,787) (28,935,734)
Adjustments for:
Exchange loss/(gain) 39,639 1,954 (12,386)
Impairment of assets 1,681,398 2,810,952 25,366,967
Loss on disposal of property, plant and equipment - 569 586
Depreciation - 22,255 46,670
Profit on disposal of assets held for sale - - (327,132)
Share in loss of associate - - 11,806
Share of joint venture loss - - 716
Share based payments 84,371 229,047 315,322
Interest received (19,764) (45,121) (108,464)
Decrease/(increase) in other receivables 253,133 (136,350) (177,562)
Payroll related levies related to prior years 55,032 - 601,754
(Decrease)/increase in other payables (496,477) 376,543 380,263
Cash flows from operating activities (1,325,497) (1,091,938) (2,837,194)
Investing activities
Payments to acquire property, plant and equipment (1,955) (114,693) (123,486)
Payments for deferred exploration expenditure (1,696,858) (2,684,663) (8,080,191)
Exploration assets held for sale (29,741) - (290,959)
Interest received 19,764 45,121 108,464
Investment in associates - (43,176) (74,634)
Proceeds from sale of licences - - 471,462
Disposal of cash in Katanga Resources Limited - - (5,155)
Cash flows used in investing activities (1,708,790) (2,797,411) (7,994,499)
Financing activities
Proceeds from issue of share capital (net of issue costs) - 12,202,857 12,202,858
Cash flows from financing activities - 12,202,857 12,202,858
Net (decrease)/increase in cash and cash equivalents (3,034,287) 8,313,508 1,371,165
Cash and cash equivalents at beginning of year 3,645,458 2,285,347 2,285,347
Exchange gain/(loss) 3,438 (3,653) (11,054)
Cash and cash equivalents at end of period 614,609 10,595,202 3,645,458
The accompanying notes form an integral part of these condensed interim consolidated financial statements.
African Eagle Resources Plc
Condensed Interim Consolidated Statement of Changes in Equity
For the six months ended 30 June 2013
Share Share Merger Available for Foreign Retained Total
capital premium reserve sale currency losses attributable to
account revaluation reserve owners
reserve
£ £ £ £ £ £ £
Balance at 1 January 2012 4,095,862 27,201,169 705,723 40,000 (190,266) (12,898,704) 18,953,784
Loss for period - - - - - (4,351,787) (4,351,787)
Exchange differences on translation of foreign operations - - - - (284,402) - (284,402)
Available for sale investments - - - 40,000 - - 40,000
Total comprehensive loss for the period - - - 40,000 (284,402) (4,351,787) (4,596,189)
Transactions with equity owners for the first half of 2012:
Issue of share capital 2,844,283 9,807,116 - - - - 12,651,399
Share issue costs - (448,542) - - - - (448,542)
Share based payments - - - - - 229,047 229,047
Total transactions with equity owners 2,844,283 9,358,574 - - - 229,047 12,431,904
Balance at 30 June 2012 6,940,145 36,559,743 705,723 80,000 (474,668) (17,021,444) 26,789,499
Loss for period - - - - - (24,583,947) (24,583,947)
Exchange differences on translation of foreign operations - - - - (515,265) - (515,265)
Available for sale investments – fair value adjustment - - (80,000) - - (80,000)
Transfer merger reserve to profit and loss - - (300,000) - - 300,000 -
Total comprehensive loss for the period - - (300,000) (80,000) (515,265) (24,283,947) (25,179,212)
Transactions with equity owners for the second half of 2012:
Share based payments - - - - - 86,275 86,275
Total transactions with equity owners - - - - - 86,275 86,275
Balance at 31 December 2012 6,940,145 36,559,743 405,723 - (989,933) (41,219,116) 1,696,562
Loss for period - - - - - (2,922,829) (2,922,829)
Exchange differences on translation of foreign operations - - - - (38,918) - (38,918)
Available for sale investments - - - - - - -
Total comprehensive loss for the period - - - - (38,918) (2,922,829) (2,961,747)
Transactions with equity owners for the first half of 2013:
Share based payments - - - - - 84,371 84,371
Total transactions with equity owners - - - - - 84,371 84,371
Balance at 30 June 2013 6,940,145 36,559,743 405,723 - (1,028,851) (44,057,574) (1,180,814)
The accompanying notes form an integral part of these condensed interim consolidated financial statements.
African Eagle Resources Plc
Notes to the Condensed Interim Consolidated Financial Statements
For the six months ended 30 June 2013
1 Nature of Operations and General Information
African Eagle Resources plc (“African Eagle” or the “Company”) whose registered address is 1st Floor, 6 – 7 Queen Street,
London, EC4N 1SP is a public limited company incorporated and domiciled in England and is listed on the AIM market of the
London Stock Exchange and on the Alternative Exchange of the Johannesburg Stock Exchange Limited (“AltX”).
Following the approval of the sale of substantially all of its subsidiaries, assets and liabilities to Blackdown Resources (UK)
Limited at a General Meeting of shareholders on 22 July 2013 and the approval of the Company’s Investing Policy the
Company is now classed as an Investing Company.
2 Statement of Compliance and basis of preparation
African Eagle’s consolidated financial statements are presented in pounds sterling (£), which is also the functional currency of
the Parent Company. The Financial Statements are for the six months ended 30 June 2013. They do not include all the
information required for full annual financial statements and should be read in conjunction with the audited consolidated
financial statements of the Group for the year ended 31 December 2012, which were prepared under International Financial
Reporting Standards (“IFRS”) as adopted by the European Union (“EU”).
The comparative amounts in the Financial Statements include extracts from the Company’s consolidated financial statements
for the year ended 31 December 2012. These extracts do not constitute statutory accounts within the meaning of Section
435 of the Companies Act 2006.
Consolidated financial statements:
Due to the Company having not been able to secure the additional funding needed to advance its development programme
in Tanzania as it had planned, and following a review of the previous tax filings of one of the Company’s Tanzanian
subsidiaries, the Directors have decided to prepare the consolidated financial statements on a basis other than that of a
going concern. The consolidated financial statements have therefore been prepared on a break up basis. In adopting the
break up basis at the year end, the following policies and procedures were implemented at the year-end and have been
consistently applied for the six months to 30 June 2013:
- At the balance sheet date all assets are considered as realisable as current assets within one year.
- Capitalised costs and other assets where no value is expected to be recovered have been impaired as set out in Note 3:
o Intangible Deferred Exploration Costs relate to licences and project costs within Tanzania that the Directors expect
to have no near term value in the absence of funding and an executable offer;
o Property, Plant and Equipment has been fully impaired as the realisable value is anticipated, net of disposal costs,
is currently expected to be nil;
o Available For Sale Investments have been impaired to reflect their realisable value at the balance sheet date
including, where applicable, the market value for listed investments at that date;
o Assets Held for Sale have been fully impaired for the Group to reflect the Directors estimate of fair value at the
balance sheet date less costs to dispose;
o Other Receivables – Short Term have been written down to their estimated realisable value at the balance sheet
date;
- Payables reflect the full value of payables, including the full value of the estimated taxation payable.
The comparative figures for the six months ended 30 June 2012 were prepared on the going concern basis and these
have not been restated to break up basis.
- Impairment
6 months to 6 months to Year to
30 June 30 June 31 December
2013 2012 2012
Unaudited Reviewed Audited
£ £ £
Deferred exploration costs 1,696,858 63,074 19,631,661
Property plant and equipment 1,955 - 152,054
Available for sale investments 49,333 - 1,456,144
Assets held for sale 29,741 991,438 1,870,506
Associates - 1,734,716 1,733,211
Joint ventures -- 21,724 21,667
Loss on disposal of subsidiary -- - 80,820
Other receivables – short term (84,207) - 420,904
1,693,680 2,810,952 25,366,967
The accounts for the six months to 30 June 2013 have been prepared on a break up basis consistently with those for the year
ended 31 December 2012. The impairment for the period has been applied as set out in Note 2.
4 Other income
Other income includes £15,605 (AUD 25,000) received from Syrah Resources Limited in relation to the sale of uranium assets
in Zambia under an agreement executed in 2011.
5 Loss Per Share
(a) Basic loss per share
The calculation of basic loss per share is based on the loss for the period divided by the weighted average number of shares
in issue during the period. In calculating the diluted loss per share potential ordinary shares such as share options and
warrants have not been included as they would have the effect of decreasing the loss per share. Decreasing the loss per
share would be anti-dilutive.
6 months to 6 months to Year to
30 June 30 June 31 December
2013 2012 2012
Unaudited Reviewed Audited
£ £ £
Loss for the period (2,922,829) (4,351,787) (28,935,734)
Weighted average number of shares in issue 694,014,407 531,734,445 613,317,814
Basic & diluted headline loss per share (0.4p) (0.8p) (4.7p)
(b) Headline loss per share
Headline loss per share has been calculated in accordance with the South African Institute of Chartered Accountants Circular
3/2009 - Headline Earnings. Circular 3/2009 is effective for interim and/or annual financial periods ending on or after
31 August 2009.
The calculation of headline loss per share is based on the headline loss for the period divided by the weighted average
number of shares in issue during the period. No diluted headline loss per share has been calculated as it would be anti-
dilutive by reducing the headline loss per share.
6 months to 6 months to Year to
30 June 30 June 31 December
2013 2012 2012
Unaudited Reviewed Audited
£ £ £
Loss for the period (2,922,829) (4,351,787) (28,935,734)
Adjusted for:
Plus loss on sale of tangible assets - 569 586
Less profit on sale of intangible assets - (212,291) -
Less profit on disposal of assets held for sale - - (327,132)
Impairment of assets 1,693,680 2,810,952 25,366,967
Plus Group share of associate loss - - 11,806
Plus Group share of joint venture - - 716
Headline loss (1,229,149) (1,752,557) (3,882,791)
Weighted average number of shares in issue 694,014,407 531,734,445 613,317,814
Undiluted headline loss per share (0.2p) (0.3p) (0.6p)
6 Available for sale investments
6 months to 6 months to Year to
30 June 30 June 31 December
2013 2012 2012
Unaudited Reviewed Audited
£ £ £
Investment in Kibo Mining Plc:
At the balance sheet date 68,000 160,000 160,000
Credit/(release) of revaluation reserve in the period 40,000 (40,000)
Impairment (49,333) - (52,000)
Carrying amount at end of period 18,667 200,000 68,000
Investment in Elephant Copper Limited:
At the balance sheet date - - 1,404,144
Impairment - - (1,404,144)
Carrying amount at end of period - - -
The investment in Kibo Mining Plc was sold after 30 June 2013 as set out in Note 7.
The investment in Elephant Copper Limited comprised 15,000,000 shares at a fully impaired cost of £1,404,144 at 30 June
2013. 5,950,000 shares formed part of the post balance sheet disposal as set out in Note 7.
7 Events after the balance sheet date
On 2 July 2013 the Company announced that, subject to shareholder approval, it had agreed to sell substantially all of its
subsidiaries, assets and liabilities to Blackdown Resources (UK) Limited (“Blackdown Resources”), and that, following such
disposal, it would be classed as an Investing Company under Rule 15 of the AIM Rules with an Investing Policy to seek
opportunities to invest in the natural resources, infrastructure and services sectors.
The agreement was to sell 90% of the issued share capital of the Company’s wholly owned subsidiary Blackdown Minerals
Limited for a total cash consideration of US$100,000. The Company has a 'free carry' and anti-dilution rights in respect of its
10% shareholding in Blackdown Minerals Limited up until US$20 million or more on the exploration and development of
projects and assets in the business of the Group or a Bankable Feasibility Study in respect of the Dutwa Nickel Project in
Tanzania has been completed.
On completion of the Disposal, the assets (other than cash) that the Company held were its 10 per cent. interest in
Blackdown Minerals, 533,333 shares in Kibo Mining Plc (See Note 7b) and 9,050,000 shares in Elephant Copper Ltd.
The proposed disposal and Investing Policy were approved by the shareholders in General Meeting on 22 July 2013.
Completion of the disposal took place on 8 August 2013, at which date the Company adopted its new Investing Policy.
On 7 August 2013 the Company received net proceeds of £21,210 from the sale of its holding of 533,333 shares in Kibo
Mining Plc.
On 14 August 2013 Dr Chris Pointon, Mr Donald Newport and Ambassador Paul Rupia resigned as Non-Executive Directors
with immediate effect and Mr Venkat Siva, Mr Paul Colucci and Mr Mark Thompson were appointed as Non-Executive
Directors, also with immediate effect.
Date: 10/09/2013 08:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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