Wrap Text
Audited condensed consolidated financial statements for the years ended 28 February 2014 and 28 February 2013
Rockwell Diamonds Inc.
(A company incorporated in accordance with
the laws of British Columbia, Canada)
(Incorporation number BCO354545)
(South African registration number: 2007/031582/10)
Share code on the JSE Limited: RDI
ISIN: CA77434W2022 Share code on the TSXV: RDI
CUSIP Number: 77434W103
("Rockwell" or "the Group")
23 May 2014
Audited condensed consolidated financial statements for the years
ended 28 February 2014 and 28 February 2013
Consolidated statements of financial position
Amounts in Canadian Dollars
As at As at
28 Feb 28 Feb
2014 2013
Assets
Non-current assets
Mineral property interests 26 641 671 31 405 358
Investment in associates 232 616 207 560
Property, plant and equipment 30 720 684 33 544 992
Investments and deposits 5 385 602 4 888 415
Rehabilitation deposits 1 701 493 1 818 291
Total non-current assets 64 682 066 71 864 616
Current assets
Inventories 4 607 953 2 304 782
Loans to related parties 185 706 94 183
Current tax receivable 35 649 39 587
Trade and other receivables 8 500 922 5 850 618
Cash and cash equivalents 1 324 328 5 570 626
Total current assets 14 654 558 13 859 796
Total assets 79 336 624 85 724 412
Equity and liabilities
Equity
Share capital 147 072 948 146 862 257
Reserves (10 008 873) (11 874 763)
Retained loss (88 096 415) (77 478 322)
Total equity attributable to
the equity holders of the Group 48 967 660 57 509 172
Non-controlling interest (1 737 222) (2 137 472)
Total equity 47 230 438 55 371 700
Liabilities
Non-current liabilities
Loans and borrowings 3 240 461 3 889 684
Finance lease obligation 110 017 281 029
Deferred tax 5 925 500 6 543 184
Rehabilitation obligation 6 459 061 6 992 157
Total non-current liabilities 15 735 039 17 706 054
Current liabilities
Loans from related parties 4 258 48 925
Loans and borrowings 1 953 651 1 314 807
Finance lease obligation 165 069 321 083
Trade and other payables 11 162 756 8 121 922
Bank overdraft 3 085 413 2 839 921
Total current liabilities 16 371 147 12 646 658
Total liabilities 32 106 186 30 352 712
Total equity and liabilities 79 336 624 85 724 412
Consolidated Statements of Profit or Loss and Other Comprehensive
Income
Amounts in Canadian Dollars
For the year For the year
ended ended
28 Feb 28 Feb
2014 2013
Sale of diamonds 41 106 550 27 105 988
Beneficiation income 4 062 860 5 299 275
Production cost (39 200 432) (31 338 217)
Operating profit before
amortization and depreciation 5 968 978 1 067 046
Amortization of mineral
property interests (927 709) (803 234)
Depreciation of property,
plant and equipment (5 008 643) (6 366 415)
Gross profit (loss) 32 626 (6 102 603)
Other income 1 703 510 599 031
General and administration expenses (4 439 754) (5 806 816)
Rehabilitation obligation
(recognized) revised (743 023) 3 549 572
Realized foreign exchange with
sale of subsidiary (6 609 464) -
Impairments (54 774) (5 411 603)
Loss before net finance costs (10 110 879) (13 172 419)
Finance income 698 932 613 760
Finance costs (1 137 131) (1 406 635)
Loss after net finance costs (10 549 078) (13 965 294)
Share of profit from equity
accounted investment 58 962 58 761
Loss before taxation (10 490 116) (13 906 533)
Taxation 62 739 130 155
Loss for the year (10 427 377) (13 776 378)
Other comprehensive income
net of taxation
Items that are or may be
reclassified to profit or loss
Exchange differences on translating
foreign operations (5 160 181) (8 733 171)
Reversal of realized foreign exchange
with sale of subsidiary 6 609 464 -
Other comprehensive income for
the year net of taxation 1 449 283 (8 733 171)
Total comprehensive income
for the year (8 978 094) (22 509 549)
Loss attributable to:
Owners of the Group (10 618 093) (10 900 533)
Non-controlling interest 190 716 (2 875 845)
Loss for the year (10 427 377) (13 776 378)
Total comprehensive income
attributable to:
Owners of the Group (9 378 344) (19 866 594)
Non-controlling interest 400 250 (2 642 955)
Total comprehensive income
for the year (8 978 094) (22 509 549)
Loss per share
Basic and diluted loss per
share (cents) (21.30) (22.55)
Consolidated Statements of Changes in Equity
Amounts in Canadian Dollars
Share Foreign Share- Total
capital currency based net
trans- payment reserves
lation reserve**
reserve*
Balance at
01 Mar 2012 145 632 846 (10 451 664) 7 605 893 (2 845 771)
Total comprehensive
income for the year
Loss for the year - - - -
Other comprehensive
income - (8 966 061) - (8 966 061)
Total comprehensive
income for the year - (8 966 061) - (8 966 061)
Share-based payment
transactions - - 558 411 558 411
Debt conversion,
net of issue costs
at $0.48 per share 218 707 - - -
Payment of conversion
of mineral right 119 930 - - -
Acquisition of non-
controlling interest 890 774 (621 342) - (621 342)
Total changes 1 229 411 (9 587 403) 558 411 (9 028 992)
Balance at
28 Feb 2013 146 862 257 (20 039 067) 8 164 304 (11 874 763)
Total comprehensive
income for the year
Loss for the year - - - -
Other comprehensive
income - 1 239 749 - 1 239 749
Total comprehensive
income for the year - 1 239 749 - 1 239 749
Share-based payment
transactions - - 626 141 626 141
Shares issued to
employees 204 750 - - -
Shares issued to
consultants 29 155 - - -
Share issue costs (23 214) - - -
Total changes 210 691 1 239 749 626 141 1 865 890
Balance at
28 Feb 2014 147 072 948 (18 799 318) 8 790 445 (10 008 873)
* Currency translation differences arising on the conversion of the
net investment in foreign operations from the functional currency to
the Company’s presentation currency are accumulated in the foreign
currency translation reserve.
** Equity settled share-based payment transactions are accumulated in
the share-based payment reserve.
Consolidated Statements of Changes in Equity
Amounts in Canadian Dollars
Retained Total Non- Total
loss equity control- equity
attri- ling
butable interest
to equity
holders of
the Group
Balance at
01 Mar 2012 (65 620 276) 77 166 799 (712 429) 76 454 370
Total comprehensive
income for the year
Loss for the year (10 900 533) (10 900 533) (2 875 845)(13 776 378)
Other comprehensive
income - (8 966 061) 232 890 (8 733 171)
Total comprehensive
income for the year (10 900 533) (19 866 594) (2 642 955)(22 509 549)
Share-based payment
transactions - 558 411 - 558 411
Debt conversion,
net of issue costs
at $0.48 per share - 218 707 - 218 707
Payment of conversion
of mineral right - 119 930 - 119 930
Acquisition of non-
controlling interest (957 513) (688 081) 1 217 912 529 831
Total changes (11 858 046) (19 657 627) (1 425 043)(21 082 670)
Balance at
28 Feb 2013 (77 478 322) 57 509 172 (2 137 472) 55 371 700
Total comprehensive
income for the year
Loss for the year (10 618 093) (10 618 093) 190 716 (10 427 377)
Other comprehensive
income - 1 239 749 209 534 1 449 283
Total comprehensive
income for the year (10 618 093) (9 378 344) 400 250 (8 978 094)
Share-based payment
transactions - 626 141 - 626 141
Shares issued to
employees - 204 750 - 204 750
Shares issued to
consultants - 29 155 - 29 155
Share issue costs - (23 214) - (23 214)
Total changes (10 618 093) (8 541 512) 400 250 (8 141 262)
Balance at
28 Feb 2014 (88 096 415) 48 967 660 (1 737 222)47 230 438
Consolidated Statements of Cash Flows
Amounts in Canadian Dollars
For the year For the year
ended ended
28 Feb 28 Feb
2014 2013
Cash flows from operating activities
Cash receipts from customers 41 998 575 31 285 232
Cash paid to suppliers and employees (39 328 485) (36 093 313)
Cash generated (used) in operations 2 670 090 (4 808 081)
Finance income 372 603 406 835
Finance costs (483 844) (533 085)
Tax paid - (39 587)
Net cash inflow (outflow) from
operating activities 2 558 849 (4 973 918)
Cash flows from investing activities
Purchase of property, plant
and equipment (8 707 671) (4 750 650)
Proceeds from sale of property,
plant and equipment 975 321 3 673 148
Purchase of mineral property
interests (199 515) -
Sale of mineral property interests 2 097 998 215 100
Asset and liability acquisition net
of cash and cash equivalents
acquired - 2 659
Proceeds from sale of subsidiary 1 679 470 -
Net movement in related party loans (143 009) (91 684)
Net movement in investments and
deposits (2 383 155) (2 075 420)
Decrease in rehabilitation deposits (65 131) 875 128
Net cash outflow from investing
activities (6 745 692) (2 151 719)
Cash flows from financing activities
Share issue costs (23 214) (5 293)
Repayment of loans and
borrowings (10 202) -
Repayment of finance lease obligations (271 531) (50 226)
Net cash outflow from financing
activities (304 947) (55 519)
Net movement in cash and cash
equivalents for the year (4 491 790) (7 181 156)
Cash and cash equivalents at the
beginning of the year 2 730 705 9 911 861
Total cash and cash equivalents
at end of the year (1 761 085) 2 730 705
Sale of subsidiary
Amounts in Canadian Dollars
As at As at
28 Feb 28 Feb
2014 2013
On 27 March 2013 ("Effective date")
the Rockwell Diamonds Inc. Group
disposed of a 100% shareholding
in Klipdam Diamond Mining Company
Proprietary Limited, which formed
part of the Northern Cape operations.
The entity was sold for an amount of
$2,413,770 of which an amount of
$734,300 is receivable only on transfer
of the mineral right to the purchaser.
The assets and liabilities sold amounted to:
Carrying value of assets sold
Property, plant and equipment (2 412 700)
Mineral property interests (1 178)
Rehabilitation obligation 984 324
Obligation to transfer investments
and deposits (1 715 200)
Trade and other payables 472 050
Total net assets sold (2 672 704)
Net assets sold (2 672 704)
Loss on disposal 258 934
(2 413 770)
Consideration received
Cash 1 679 470
Deferred consideration - included in
other receivables 734 300
2 413 770
Loss per share
Amounts in Canadian Dollars
Year ended Year ended
28 Feb 28 Feb
2014 2013
Basic and diluted loss per share
Cents per share (21.30) (22.55)
Basic loss per share was calculated
based on a weighted average number
of common shares of 49 839 859
(2013:48 349 322).
Reconciliation of loss for the
year to basic loss
Loss for the year (10 427 377) (13 776 378)
Adjusted for:
(Profit) loss attributable to
non-controlling interest (190 716) 2 875 845
Basic loss attributable to
owners of the Group (10 618 093) (10 900 533)
At 28 February 2014 and
28 February 2013 the impact of
share-based payment options were
excluded from the weighted average
number of shares, for the purpose of
the diluted loss per share
calculation, as the effect would have
been anti-dilutive.
Basic and diluted headline loss per share
Cents per share * (8.68) (14.40)
Reconciliation between basic loss
and headline loss
Basic loss attributable to owners
of the Group (10 618 093) (10 900 533)
Adjusted for:
(Profit) loss on disposal of
mineral properties (482 060) 23 900
(Profit) loss on disposal of
property, plant and equipment (72 109) 156 062
Impairment of mineral property
interests - 959 124
Impairment of property, plant and
equipment 35 799 4 826 619
Reversal of impairment on property,
plant and equipment - (585 923)
Share of profit from equity
accounted investment* (58 962) (58 761)
Loss on sale of subsidiary 258 934 -
Realized foreign exchange with
sale of subsidiary 6 609 464 -
Non-controlling interest portion
of above adjustments - (1 380 556)
Headline loss attributable to
owners of the Group * (4 327 027) (6 960 068)
The basic and diluted headline loss per share disclosure is provided
based on the listings requirements of the Johannesburg Stock Exchange
(Group’s secondary listing). The disclosure of basic and diluted
headline loss per share is provided in accordance with Circular
2/2013 as issued by the South African Institute of Chartered
Accountants. Headline loss represents the basic loss attributable to
the owners of the Group excluding certain re-measurements.
At 28 February 2014 and 28 February 2013 the impact of share-based
payment options were excluded from the weighted average number of
shares, for the purpose of the diluted headline loss per share
calculation, as the effect would have been anti-dilutive.
* 28 February 2013 restated due to Circular 2/2013 which is the new
requirement applicable for financial statements issued after
30 April 2013.
Segmental information
The Group has three reportable operating segments, as described
below, which are the Group’s operating divisions. These divisions
offer different diamond product characteristics, qualities,
geological characteristics, processes and services, and are managed
separately because they require different technology and profit or
cost strategies. For each of the divisions the Group executive
committee (chief operating decision making body) reviews internally
managed reports on at least a monthly basis. The following describes
the operations in each of the Group’s reportable segments:
- Northern Cape operation is associated with the mining of
Paleo Channels and Rooikoppie gravels and the recovery of high value
and larger carat size diamonds;
- North West operation is associated with the mining of
potholes and the recovery of lower value and smaller carat size
diamonds; and
- Corporate represents the corporate management and
administrative function of the Group.
The reconciliation column represents the inter-group transactions
eliminated on consolidation. All reportable segments are located in
the same geographical jurisdiction. Information regarding the results
of each of the reportable segments is included below.
For the year ended 28 Feb 2014
Northern North Corp- Recon- Total
Cape West orate ciling
Property,
plant
and equipment 29 079 243 1 627 368 14 073 - 30 720 384
Mineral
property
interests 16 265 209 10 376 462 - - 26 641 671
Total assets 57 737 809 13 988 120 71 697 759 (64 087 064) 79 336 624
Total
liabilities 72 155 110 21 589 291 2 448 849 (64 087 064) 32 106 186
External
revenue 36 444 590 8 724 820 - - 45 169 410
Other material
non-cash items
- Depreciation
on property,
plant and
equipment 4 763 815 241 488 3 340 - 5 008 643
- Amortization
on mineral
property
interests 784 774 142 935 - - 927 709
- Rehabilitation
obligation
(revised)
recognised 1 167 318 (424 295) - - 743 023
- Impairment of
mineral property
interests - - - - -
- Impairment of
property, plant
and equipment 35 799 - - - 35 799
- Reversal of
impairment on
property, plant
and equipment - - - - -
- Write down mine
supplies 18 975 - - - 18 975
- Share of profit
from equity
accounted
investment - - (58 962) - (58 962)
Finance income 514 170 92 669 92 093 - 698 932
Finance costs 532 919 505 030 99 182 - 1 137 131
Taxation 62 739 - - - 62 739
Loss for the
year (2 293 652) 688 261 (8 821 986) - (10 427 377)
For the year ended 28 Feb 2013
Northern North Corp- Recon- Total
Cape West orate ciling
Property,
plant and
equipment 29 105 278 4 431 591 8 123 - 33 544 992
Mineral
property
interests 19 821 470 11 583 888 - - 31 405 358
Total assets 55 769 553 17 251 694 80 189 009 (67 485 844) 85 724 412
Total
liabilities 69 560 627 25 888 561 2 389 368 (67 485 844) 30 352 712
External
revenue 30 600 628 1 804 635 - - 32 405 263
Other material
non-cash items
- Depreciation
on property,
plant and
equipment 5 032 684 1 330 381 3 350 - 6 366 415
- Amortization
on mineral 760 635 42 599 - - 803 234
property
interests
- Rehabilitation
obligation
(revised)
recognised 831 778 (4 381 350) - - (3 549 572)
- Impairment of
mineral property
interests 959 124 - - - 959 124
-Impairment of
property, plant
and equipment 411 169 4 415 450 - - 4 826 619
-Reversal of
impairment on
property, plant
and equipment (585 923) - - - (585 923)
-Write down to
net realizable
value of diamond
inventories 374 207 - - - 374 207
-Write down of
mine supplies 125 970 - - - 125 970
-Impairment of
sundry
receivables 55 938 29 875 - - 85 813
- Share of profit
from equity
accounted
investment - - 58 761 - 58 761
Finance income 356 463 85 079 172 218 - 613 760
Finance cost 423 076 879 018 104 541 - 1 406 635
Taxation 130 155 - - - 130 155
Loss for the
year (5 184 428) (7 217 461) (1 374 489) - (13 776 378)
Subsequent events
Management is not aware of any matter or circumstance arising since
the end of the financial year.
23 May 2014
Corporate information
Registered office – South Africa: Level 1, Wilds View, Isle of Houghton
Corner Carse O’Gowrie and Boundary Roads, Houghton Estate, Johannesburg 2198
PO Box 3011, Houghton 2041, South Africa
Telephone: +27 11 484 4722 Facsimile: +27 86 501 6328
Corporate address – Canada: 1020–800 West Pender Street, Vancouver,
British Columbia, Canada V6C 2V6
Telephone: +1 604 684 636 Facsimile: +1 604 684 8092
Toll Free: 1 800 667 2114
Corporate advisor: Allan Hochreiter Proprietary Limited
4 Fricker Road, Illovo, Sandton 2196, South Africa
JSE sponsor: PSG Capital
First Floor, Building 8 Inanda Greens Business Park, 54 Wierda Road West
Wierda Valley, Sandton 2196
International broker: Northland Capital Partners Limited
60 Gresham Street, London, EC2V 7BB United Kingdom
Auditors: KPMG Inc Chartered Accountants
KPMG Crescent, 85 Empire Road, Parktown 2193, South Africa
Transfer agents - South Africa: Computershare Investor Services Proprietary Limited
(Registration number 2004/0036471/07)
Ground Floor, 70 Marshall Street Johannesburg 2001, South Africa
Transfer agents - Canada: Computershare Investor Services Inc.
3rd Floor, 510 Burrard Street, Vancouver, British Columbia, Canada V6C 3B9
Lawyers - South Africa: Brink Falcon Hume Inc Attorneys
Second Floor, 8 Melville Road, Illovo, Sandton 2196, South Africa
Lawyers - Canada: Mc Millan LLP
Royal Centre 1055 West Georgia Street, Suite 1500 Vancouver,
British Columbia, Canada V6E 4N7
Date: 23/05/2014 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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