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Reviewed Condensed Consolidated Interim Financial Statements
Bauba Platinum Limited
(Incorporated in the Republic of South Africa)
(Registration number 1986/004649/06)
Share code: BAU ISIN No: ZAE000145686
(“Bauba” or “the Company” or “the Group”)
Reviewed Condensed Consolidated Interim
Financial Statements For the six months ended 31 December 2014
INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AT 31 DECEMBER 2014
Reviewed Reviewed Audited
31 December 31 December 30 June
2014 2013 2014
R 000’s R 000’s R 000’s
ASSETS
Non-current assets 137 622 31 927 28 343
Intangible assets 136 972 31 668 28 057
Property, plant and equipment 650 259 286
Current assets 8 173 2 936 1 278
Trade and other receivables 770 232 363
Cash and cash equivalents 7 403 2 704 915
TOTAL ASSETS 145 795 34 863 29 621
EQUITY AND LIABILITIES
Capital and reserves 127 628 33 592 25 072
Share capital 508 744 127 062 127 062
Share premium - 274 532 274 532
Reverse asset acquisition reserve (282 988) (282 988) (282 988)
Retained loss (93 089) (83 465) (89 324)
Non-controlling interest (5 039) (1 549) (4 210)
Current liabilities 18 167 1 271 4 549
Trade and other payables 18 167 1 271 4 549
TOTAL EQUITY AND LIABILITIES 145 795 34 863 29 621
Net asset value per share (cents) 33.7 26.4 19.7
Tangible net asset value per share (cents) (2.5) 1.5 (2.3)
INTERIM CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE
INCOME FOR THE SIX MONTH PERIOD ENDED 31 DECEMBER 2014
Reviewed Reviewed Audited
31 December 31 December 30 June
2014 2013 2014
R 000’s R 000’s R 000’s
Operating expenditure (886) - (345)
Impairment of intangible assets - - (4 108)
General and administrative expenses (3 741) (4 042) (8 144)
Finance income 33 73 108
Loss before taxation (4 594) (3 969) (12 489)
Taxation - - -
Comprehensive loss for the period (4 594) (3 969) (12 489)
Loss for the period – attributable to: (4 594) (3 969) (12 489)
-Equity holders of the Company (3 765) (3 779) (9 638)
-Non-controlling interest (829) (190) (2 851)
Reconciliation to headline loss
Net loss before taxation for the period (3 765) (3 779) (9 638)
Impairment of intangible assets - - 4 108
Headline loss for the period (3 765) (3 779) (5 530)
Undiluted and diluted earnings per share
Loss per share (cents) (2.4) (3.1) (7.7)
Undiluted and diluted headline earnings per share
Headline loss per share (cents) (2.4) (3.1) (4.4)
Weighted average number of shares in issue (000’s) 159 926 123 294 125 162
Total number of shares in issue at the end of the period (000’s) 379 020 127 061 127 061
INTERIM CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTH PERIOD ENDED 31 DECEMBER 2014
Reviewed Reviewed Audited
31 December 31 December 30 June
2014 2013 2014
R 000’s R 000’s R 000’s
Net cash inflow/(outflow) from operating activities 8 606 (3 481) (4 795)
Net cash outflow from investing activities (925) (1 040) (1 515)
Net cash (outflow)/inflow from financing activities (1 193) 2 000 2 000
Net increase/(decrease) in cash and cash equivalents 6 488 (2 521) (4 310)
Cash and cash equivalents at beginning of period 915 5 225 5 225
Cash and cash equivalents at end of period 7 403 2 704 915
INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTH PERIOD ENDED 31 DECEMBER 2014
Share Share Retained Non- Reverse Total
capital premium loss controlling acquisition
interest reserve
R 000’s R 000’s R 000’s R 000’s R 000’s R 000’s
Balance at 31 December 2013 127 062 274 532 (83 465) (1 549) (282 988) 33 592
Comprehensive loss for the period - - (5 859) (2 661) - (8 520)
Balance at 30 June 2014 127 062 274 532 (89 324) (4 210) (282 988) 25 072
Conversion to no par value shares 274 532 (274 532) - - - -
Comprehensive loss for the period - - (3 765) (829) - (4 594)
Issue of shares 108 343 - - - - 108 343
Share issue costs (1 193) - - - - (1 193)
Balance at 31 December 2014 508 744 - (93 089) (5 039) (282 988) 127 628
Commentary
Production Progress
The Group successfully completed the acquisition of the chrome assets (“Chrome Acquisition”) as
described in the circular to shareholders dated 22 August 2014 during the period under review with approval
granted by shareholders at the general meeting held on 19 September 2014. Following the successful
completion of the Chrome Acquisition the Department of Mineral Resources (“DMR”) awarded Bauba’s
major subsidiary, Bauba A Hlabirwa Mining Investments Proprietary Limited (“Hlabirwa”), a Small-scale
Mining Permit over the chrome asset, which award was announced to shareholders in the announcement
dated 11 November 2014. Subsequent to the period under review as announced on SENS dated 23
February 2015, the Department of Water And Sanitation (“DWAS”) awarded Hlabirwa a General
Authorisation (“GA”) for water usage, which finalised the legislative requirements to commence mining on
the farm Moeijelijk 412KS, earmarking a long anticipated and exciting new future for Bauba. Site preparation
commenced immediately after the award of the GA and chrome ore exposure commenced soon thereafter.
Full scale mining commenced in the third week of March 2015.
Results
In pursuance of the conclusion of the Chrome Acquisition and the anticipated commissioning of the chrome
project, the related legislative requirements and the maintaining of its platinum prospecting rights, the Group
received R12.6 million as advance payments as per the chrome ore supply agreement. R0.9 million was
utilised on exploration activities of which R0.6 million was capitalised in line with Group’s accounting
policies, R1.3 million on the chrome project of which R0.4 million relates to capital equipment, R3.4 million
on general and administration costs and R1.2 million on transaction costs associated with the chrome
transaction. The net result of these activities during the period under review resulted in an increase in cash
reserves of R6.5 million.
Exploration
Exploration activities were restricted to legal compliance associated with the maintenance of the
prospecting rights. It is anticipated that drilling activities will be resumed in the Northern Cluster in the third
quarter of this calendar year with the focus on establishing sufficient information to conduct a prefeasibility
study. Preparations for the submission of a Mining Right Application for these properties has commenced.
Chrome
The DMR has awarded the Group a Small-scale Mining Permit covering an area of 5ha. This equates to
approximately 240 000 tonnes of run of mine chrome ore to be mined at a planned 20 000 tonnes per month
at full production. The chrome project was successfully commissioned in January 2015 with initial site
establishment and access road development. On 19 March 2015 the open cast mining operations
commenced with the first blast on the LG6 chrome horizon. It is expected that this blast will yield 15 000
tonnes of chrome ore at an expected grade of 39% chrome. As run of mine ore this will be delivered to the
ASA Metals Proprietary Limited Plant, and a planned production rate of 20 000 tonnes per month will then
be maintained.
The Group applied for a Mining Right over the Chrome project in December 2014 and this application was
accepted by the DMR on 10 February 2015. All additional requirements for the application of the Mining
Right are being complied with.
Legal Tenure
During the period under review the DMR notarially executed the prospecting right over the farm Houtbosch
323KT adding it to the existing prospecting rights held by the Group. The Group also became the beneficial
owners over the farms Moeijelijk 412KS and Waterkop 113KT as announced in the circular to shareholders
dated 22 August 2014. These farms were originally included in the existing prospecting rights and
accordingly there was no need to amend the prospecting rights.
The Group has made substantial progress with the Mining Right application over the platinum prospecting
rights and the submission of this application will be made in June 2015.
Legal
There is currently a review application pending in the North Gauteng High Court of South Africa, Pretoria
brought by Rustenburg Platinum Mines Limited (“the Applicant”), against a decision of the Department of
Mineral Resources to grant the prospecting rights in respect of the farms Genokakop 285KT, Groot
Vygenboom 284KT and Houtbosch 412KS. Bauba’s subsidiary, Hlabirwa, the legal holder of the
prospecting rights, was cited as a respondent in this matter. After taking legal advice on the matter, Hlabirwa
has expedited the determination of the application during the period under review by requesting the High
Court to dismiss this matter as the applicant has amongst other issues, failed to take any meaningful steps
to advance the review application for a number of years and has not proceeded correctly to protect its
alleged rights. Hlabirwa hopes to succeed in defeating the review application.
A previous employee of the Group has lodged a claim for compensation due to his resignation for alleged
good cause.
The Group has taken senior counsel advice on both these matters and was informed that the judicial system
should find in the Group’s favour.
Notes to the reviewed interim financial statements
Basis of preparation
The board of directors of Bauba (“the Board”) present the reviewed condensed consolidated interim
financial results for the six months ended 31 December 2014, which have been prepared in accordance
with the framework concepts and the measurement recognition requirements of International Financial
Reporting Standards (“IFRS”) and the SAICA Financial Reporting Guides as issued by the Accounting
Practices Committee and Financial Reporting Pronouncements as issued by the Financial Reporting
Standards Council and its successor, the Companies Act of South Africa (“the Companies Act”) and the
Listings Requirements of JSE Limited and contains the information required by IAS 34: Interim Financial
Reporting. The accounting policies are in terms of IFRS and are supported by reasonable and fair
judgements and estimates. These accounting policies are consistent with those applied in the annual
financial statements for the year ended 30 June 2014.
These condensed consolidated interim financial results have been prepared under the supervision of Mr
Willem Moolman, the Financial Director of Bauba.
Review opinion
These condensed consolidated interim financial results for the six months ended 31 December 2014 have
been reviewed by the Company’s auditors, BDO South Africa Incorporated. A copy of their unqualified
review opinion is available for inspection at the registered office of the Company.
Segmental information
The Group has classified three segments namely:
(1) Chrome, being mining activities associated with the chrome asset acquired in the period
(2) Exploration, being activities associated with the Bauba Project and platinum exploration; and
(3) Corporate, being administration, regulatory and corporate expenses incurred.
Chrome Exploration Corporate Total
31 December 2014 R 000’s R 000's R 000's R 000's
Operating expenditure (886) - - (886)
General and administrative expenses - (287) (3 432) (3 719)
Depreciation and amortisation - (2) (20) (22)
External interest received - - 33 33
Comprehensive loss for the period (886) (289) (3 419) (4 594)
Total segment assets 108 803 29 385 7 607 145 795
Total segment liabilities (16 261) (1 427) (479) (18 167)
31 December 2013
General and administrative expenses - (475) (3 473) (3 948)
Depreciation and amortisation - (72) (22) (94)
External interest received - - 73 73
Comprehensive loss for the period - (547) (3 422) (3 969)
Total segment assets - 31 743 3 120 34 863
Total segment liabilities - (950) (321) (1 271)
Going concern
The condensed consolidated interim financial statements have been prepared on the basis of accounting
policies applicable to a going concern. This basis presumes that funds will be available to finance future
operations and that the realisation of assets and settlement of liabilities, contingent obligations and
commitments will occur in the ordinary course of business. As is common with many junior mining
companies, the Group raises capital for exploration and other projects as and when required. Future work
on the development of these projects may be adversely affected by factors outside of the control of the
Group.
Subsequent events
All material subsequent events were covered in the detail above and there were no other material
subsequent events of which the Board is aware of at the date of these interim financial results.
Conclusion
The awarding of the Small-scale Mining Permit from the DMR and the general authorisation for water usage
from the DWAS has paved the way for the potential of a steady cash flow stream, which may satisfy the
Group’s financial requirements to advance its projects for the foreseeable future. In accordance with the
Chrome Acquisition agreement, fifty percent of the net cash generated from the chrome project will be
available for distribution to shareholders subject to compliance with the Companies Act requirements. With
a sizeable distribution of the net cash proceeds from the chrome operation being diverted into the
exploration program, the Group will be in a favourable position to apply for a Mining Right over its platinum
project and to further develop and exploit its platinum resources.
Directorate
There was no change to the Board during the period under review.
On behalf of the Board
JG Best SJM Caddy
Chairman Chief Executive Officer
23 March 2015
Board of Directors:
Non-executive
Mr JG Best* (Chairman), Mr KV Dicks*, Mr SM Dolamo*, Ms KW Mzondeki*, Dr NM Phosa,
Mr D Smith, King TV Thulare (Alt to Dr NM Phosa). (* Independent)
Executive
Mr SJM Caddy (CEO), Mr WA Moolman (FD)
Sponsor
Merchantec Capital
Registered Office
1st Floor, Building 816/5, Hammets Crossing Office Park, 2 Selbourne Road, Fourways, Johannesburg,
Gauteng, South Africa.
Company Secretary
Merchantec Proprietary Limited
2nd Floor, North Block, Hyde Park Office Tower, Cnr 6th Road and Jan Smuts Avenue,
Hyde Park, 2196
(PO Box 41480, Craighall, 2024)
Auditor
BDO South Africa Incorporated
Date: 23/03/2015 12:35:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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