Wrap Text
Unaudited interim financial results for the 6 months ended 31 August 2013
MINE RESTORATION INVESTMENTS LIMITED
(formerly Capricorn Investment Holdings Limited)
(Registration Number 1987/004821/06)
("MRI" or "the Company")
Share code: MRI ISIN: ZAE000149951
UNAUDITED INTERIM RESULTS for the 6 months ended 31 August 2013
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
6-months to 8-months to 14-months
August 2013 August 2012 to February
2013
R’000 R’000 R’000
Other income - 29 20 021
Operating (expenses)/recoveries (4 093) 3 985 (9 048)
Operating (loss)/profit (4 093) 4 014 10 973
Investment revenue 5 91 177
Interest expense (2 707) (2 023) (4 908)
(Loss)/Profit before taxation (6 795) 2 082 6 242
Taxation credit/(charge) 1 550 244 (11 415)
(Loss)/Profit for the period (5 245) 2 326 (5 173)
Other comprehensive income - - -
Total comprehensive (loss)/income (5 245) 2 326 (5 173)
(Loss)/Profit attributable to:
Equity holders (4 283) 2 375 (5 095)
Non-controlling interests (962) (50) (78)
Total comprehensive (loss)/income
attributable to:
Equity holders (4 283) 2 375 (5 095)
Non-controlling interests (962) (50) (78)
Basic and diluted earnings/(loss)
per share (0.91) 0.01 (1.74)
Basic and diluted headline
earnings/(loss) per share (0.91) 0.01 (1.74)
Weighted average number of shares
(‘000) 468 413 168 734 292 106
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
31 August 31 August 28 February
2013 2012 2013
R’000 R’000 R’000
Assets
Non-Current Assets
Property, plant and equipment 14 404 2 950 10 798
Intangible assets 91 284 92 144 92 411
Investment in associate 1 000
Deferred tax 1 550 6 380 7 173
107 238 102 474 110 382
Current Assets
Trade and other receivables 521 127 610
Cash and cash equivalents 3 270 10 890 314
3 791 11 017 924
Total Assets 111 029 113 491 111 306
Equity and Liabilities
Equity
Amount attributable to equity holders 38 565 59 405 39 886
Equity loan 5 000 5 000
Non-Controlling Interest 16 390 16 380 17 352
59 955 75 785 62 238
Liabilities
Non-Current Liabilities
Deferred tax 18 464 13 177 25 626
Other financial liabilities 25 768 24 213 22 002
44 232 37 390 47 628
Current Liabilities
Other financial liabilities 6 795 - -
Trade and other payables 31 316 1 407
Current tax payable 16 - 33
6 842 316 1 440
Total Equity and Liabilities 111 029 113 491 111 306
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share Retained Amount Non- Total equity
capital, earnings attributable Controlling
Share to Equity Interest
Premium and Holders
Reverse
Acquisition
Reserve
R’000 R’000 R’000 R’000 R’000
Group
Balance at 1 - (952) (952) 16 430 15 478
January 2012
Reverse 17 952 - 17 952 - 17 952
acquisition
Issue of 40 028 - 40 028 - 40 028
additional
shares
Total - 2 376 2 376 (50) 2 326
comprehensive
profit/(loss)
for the
period
Total changes 57 980 2 376 60 356 (50) 60 306
Balance at 31 57 980 1 424 59 404 16 380 75 784
August 2012
Reverse (49 019) - (49 019) - (49 019)
acquisition
Issue of 36 972 - 36 972 1 000 37 972
additional
shares
Total - (7 471) (7 471) (28) (7 499)
comprehensive
loss for the
period
Total changes (12 047) (7 471) (19 518) 972 (18 546)
Balance at 28 45 933 (6 047) 39 886 17 352 57 238
February 2013
Issue of 2 962 - 2 962 - 2 962
additional
shares
Total - (4 283) (4 283) (962) (5 245)
comprehensive
loss for the
period
Total changes 2 962 (4 283) (1 321) (962) (2 283)
Balance at 31 48 895 (10 330) 38 565 16 390 54 955
August 2013
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
6 months to 8 months to 14 months
August 2013 August 2012 to February
2013
R’000 R’000 R’000
Cash flows utilised in operating
activities
Cash (utilised in)/from operations (4 219) 4 910 386
Interest income 5 91 177
Finance costs (2 707) (2 023) (4 908)
Taxation refunded / (paid) (18) (7) 8
Cash (utilised in)/from operating (6 939) 2 971 (4 337)
activities
Cash flows from investing activities
Purchase of property, plant and (3 627) (2 948) (10 814)
equipment
Net cash acquired on reverse 3 694
acquisition
Net cash available from/(utilised in) (3 627) 746 (10 814)
investing activities
Cash flows from financing activities
Proceeds on raising of new share 2 962 40 029 38 215
capital
(Repayment of)/Proceeds on advance of - (35 295) (27 977)
loans from Group companies
Increase in other financial liabilities 10 560 1 855 4 643
Net cash available from financing 13 522 6 589 14 881
activities
Total cash movement for the year 2 956 10 306 (270)
Cash and cash equivalents at the 314 584 584
beginning of the year
Cash and cash equivalents at end of the 3 270 10 890 314
period
COMMENTARY
1. BASIS OF PREPARATION
These condensed consolidated financial statements have been prepared under
the supervision of A Meyer in accordance IFRS, SAICA Financial Reporting
Guides as issued by the Accounting Practices Committee and Financial
Pronouncements as issued by the Financial Reporting Standards Council, the
Companies Act No 71 of 2008, as amended and the JSE Limited Listings
Requirements and include the disclosures required by IAS34 Interim
Financial Reporting.
The financial statements have been prepared using accounting policies that
comply with IFRS and which are consistent with those applied in the
preparation of the financial statements for the 14 month period ended 28
February 2013.
2. REVERSE-ACQUISITION AND CHANGE IN FINANCIAL PERIOD
During the previous financial year, MRI (formerly Capricorn Investment
Holdings Limited) was, from an IFRS perspective, acquired by Western
Utilities Corporation (Pty) Limited (“WUC”) by way of a reverse-
acquisition. The acquisition is a reverse-acquisition in terms of IFRS 3
Business Combinations. Accordingly, MRI is regarded as the legal parent
and accounting acquired and WUC is regarded as the legal subsidiary
company and the accounting acquirer. In accordance with this accounting
treatment, the following has taken place:
a) The identifiable assets and liabilities of MRI were brought into the
books and measured at their fair-value;
b) The condensed consolidated financial statements issued are those of
MRI, the legal parent and accounting acquirer, but are described in
the notes as a continuation of the financial statements of WUC, the
legal subsidiary company and accounting acquirer. WUC’s results have
been adjusted to retrospectively reflect the legal capital of MRI.
As such, the financial statements reflect a continuation of the
financial statements of WUC.
c) The year-end of WUC was 31 December of every year. CIPC approved the
change of the year-end of WUC to the last day of February every
year, in line with the year-end of MRI. Accordingly, the prior year
results for MRI are shown for a 14-month period to 28 February 2013.
3. AUDITOR REVIEW
These condensed consolidated financial statements have not been reviewed
by the external auditor.
4. COMMENTARY
HISTORIC PERSPECTIVE
MRI changed its name from Capricorn Investment Holdings Limited to reflect
the new nature of its business and the new focus of the Company post the
acquisition of WUC. The acquisition of WUC has created two strategic focus
areas for the Company, namely Coal Fines Briquetting (“Coal Briquetting
Project”) and Acid Mine Drainage (“AMD Project”). Both these projects are
focused on reducing the environmental impact of mining, whilst at the same
time aiming to produce a significant return on investment of shareholders.
The Coal Briquetting Project was commissioned in the third quarter of the
2013 calendar year and should take three months to reach full production.
This project is expected to provide a significant return on capital
invested. Revenues generated from this project will be used to repay
existing debt within the Group, further capitalise the Company and will be
used to provide the capital to invest and grow this part of our business.
With regards the AMD Project, the South African government is currently
drafting its findings of a pre-feasibility study conducted by the
department on the various technologies available for AMD treatment. WUC
has already completed a Bankable Feasibility Study for the project,
including documenting engineering and environmental authorisation
processes. This project remains a strategic focus area of the Company and
WUC intends to participate in the process should the department elect to
engage in Public Private Partnerships or any other structure.
The Company also intends to explore other potential applications for the
Intellectual Property (“IP”) held by the company.
RESULTS OF OPERATIONS
The results of the operations of MRI, and its subsidiary company, WUC
(“the Group”), for the 6-month period ended 31 August 2013 reflects the
ongoing cost of the Group while it built and commissioned the Coal
Briquetting Project’s plant. Revenue from the Coal Briquetting Project is
expected during the fourth quarter of the 2013 calendar year.
The value for the briquetting project is based on a discounted cash flow
model of the resources that is included in the agreement with Leeuw Mining
and Keaton and the plant being constructed at the Vaalkrantz Colliery
site. Once this plant is operational the intention is to expand to the
larger coal producers who produce significantly more fines although at
lower grades.
WUC intends to tender for the long term acid mine drainage solution and
therefore according to the Bankable Feasibility Study the information we
have generated over the past 5 years is well worth R44 million. This is
not the only AMD project in the world and the technology and information
generated has application in other areas like South and North America.
Interest paid has been reduced and now only relates to the repayment of
interest bearing loans raised pursuant to the reverse-listing of WUC into
MRI.
Taxation credits and charges primarily result from adjustments to deferred
taxation.
FUTURE PROSPECTS
The Coal Briquetting Project has commenced operations in October 2013 and
should contribute significantly to the overall profitability of the Group.
The directors of MRI intend to continue to pursue the awarding of the
water use licenses required by WUC for its AMD technology as well as for
other potential applications of its IP.
5. SEGMENT INFORMATION
The group is not presently managed by segment. Accordingly, no segment
information is provided. As operations become established, this will
likely change.
6. HEADLINE EARNINGS/(LOSS) PER SHARE
Reconciliation of earnings to headline earnings attributable to equity
holders of the parent:
6-months to 8-months to 14-months to
August 2013 August 2012 February
R’000 R’000 2013
R’000
Loss per share (0.91) 0.01 (1.74)
Headline loss per share (0.91) 0.01 (1.74)
HEPS Calculation
(Loss)/Profit for the year (4 283) (2 376) (5 095)
Adjustments
Gain on bargain purchase price, net - - -
of tax
Headline loss (4 283) (2 376) (5 095)
Weighted average number of shares 468 413 168 733 292 106
in issue (‘000)
Actual number of share in issue 470 704 455 695 455 891
(‘000)
7. CHANGES IN SHARE CAPITAL
During the year, the Company issued 14 812 520 new shares in order to
raise cash for the completion of the briquetting plant. The proceeds of
this issue amounted to R 2 962 504.
8. RELATED PARTY TRANSACTIONS
As the largest shareholders, Trinity Asset Management Proprietary Limited
and Armadale Capital have committed to jointly bridge any shortfall in the
working capital of MRI to the maximum value of R11 million for the period
ending 31 December 2013.
Other than mentioned above, and other than loans advanced or received in
the normal course of business, there have been no significant changes in
the related party relationships during the year.
9. EVENTS AFTER THE END OF THE REPORTING PERIOD
No significant transactions, which require disclosure, have occurred since
the end of the period to the date of this announcement.
10. CHANGES TO THE COMPOSITION OF THE BOARD
During the half year period, up to date of this report, the following
resignations and appointments of directors occurred:
Resignations:
Charles Pettit – 18 April 2013;
Sandile Swana – 31 July 2013;
Steve Tredoux – 3 September 2013;
James Herbst – 3 September 2013;
Michelle van den Berg – 30 September 2013; and
Jaco Schoeman – 15 November 2013
Appointments:
Richard Tait – 18 April 2013;
Justin Lewis – 18 September 2013; and
Syd Caddy – 18 November 2013
Change of role:
Anthon Meyer accepted the position of Financial Director as of 1 October
2013.
With the resignation of J Schoeman as CEO of the Company, Mr R Tait,
current non-executive director will take over as Chief Executive Officer
(“CEO”) with effect from 15 November 2013 until a suitable, permanent
candidate is identified.
The new board now consists of the following directors:
Quinton George – Non-Executive Chairman
Richard Tait – CEO
Anthon Meyer – Financial Director
Chris Roed – Independent Non-Executive Director
Justin Lewis – Non-Executive Director
Syd Caddy – Independent Non-Executive Director
11. DIVIDENDS
No dividend will be declared for the financial period ended 31 August
2013. (2012: Nil).
18 November 2013
Johannesburg
Q George Prepared by: A Meyer
CORPORATE INFORMATION
Mine Restoration Investments Limited
Country of incorporation and domicilium: South Africa
Postal address
PO Box 825, Irene, 0062, Pretoria
Tel no:+27 (012) 345 4037
Fax no:+27 (012) 345 4808
Web: www.minerestoration.co.za
Directors: Q George# (Chairman), A Meyer, C Roed*, J Lewis#, R Tait
(CEO), S Caddy*
(#Non-Executive, * Independent Non-Executives)
Company Secretary: Neil Esterhuysen & Associates Inc
Registered Office: Units 23&24 Norma Jean Square, 244 Jean Avenue,
Centurion
Transfer Secretaries: Computershare Investor Services (Pty) Limited,
70 Marshall Street, Marshalltown 2001, PO Box 61051, Marshalltown
2107
Auditor: Horwath Leveton Boner
Corporate Advisor: AfrAsia Corporate Finance Proprietary Limited
Designated Advisor: Sasfin Capital (a division of Sasfin Bank Limited)
Date: 18/11/2013 11:40:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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