Wrap Text
Interim Financial Report for the half year ended 31 December 2015
Resource Generation Limited
Registered in Australia under the Corporations Act, 2001
(Cth) with
registration number ACN: 059 950 337
ISIN: AU000000RES1
Share Code on the ASX: RES
Share Code on the JSE: RSG
(“Resource Generation” or the “Company”) ABN 91 059 950 337
Interim Financial Report for the half year ended 31 December 2015
Contents Page
Directors' report 2,3
Auditor's independence declaration 4
Interim financial report
Condensed consolidated statement of profit or loss and other comprehensive income 5
Condensed consolidated statement of financial position 6
Condensed consolidated statement of changes in equity 7
Condensed consolidated statement of cash flows 8
Notes to the condensed consolidated financial statements 9, 10, 11, 12
Directors' declaration 13
Independent auditor's review report to members 14,15
Supplementary information - presentation of financial information in South African Rand 16,17,18
This interim financial report does not include all of the notes of the type normally included in an annual financial report. Accordingly, this
report is to be read in conjunction with the annual report for the year ended 30 June 2015 and any public announcements made by
Resource Generation Limited during the interim reporting period in accordance with the continuous disclosure requirements of the
Corporations Act 2001.
RESOURCE GENERATION LIMITED
Directors' report
The Board of Directors present their report on the consolidated entity consisting of Resource Generation Limited (the
Company) and the entities it controlled for the half year ended 31 December 2015.
Directors
The following persons were appointed Directors of Resource Generation Limited during the period and were still in office at the
date of this report:
Mr D Gately (Chairman) (Appointed 26 November 2015)
Mr L Xate (Deputy Chairman) (Appointed 26 November 2015)
Mr R Croll (Non-Executive Director) (Appointed 26 November 2015)
Mr C Gilligan (Non-Executive Director) (Appointed 26 November 2015)
Mr L Molotsane (Non-Executive Director) (Appointed 26 November 2015)
Dr K Sebati (Non-Executive Director) (Appointed 26 November 2015)
The following persons were Directors of Resource Generation Limited from the beginning of the period and removed from
office as indicated below:
Mr B Warner (Chairman) (Removed 26 November 2015)
Mr P Jury (Managing Director) (Removed 26 November 2015)
Mr S Matthews (Executive Director and Company Secretary) (Removed 26 November 2015)
Mr G Rose AO (Non-Executive Director) (Removed 26 November 2015)
Mr M Meintjes was appointed Company Secretary on 26 November 2015.
Review of Operations
During the half year ended 31 December 2015 the consolidated entity recorded a net loss of $8.1 million (2014 loss $3.2
million). The net loss for the half year to 31 December 2015 of $8.1 million reflects employee expenses of $2.2 million, an
unrealised foreign exchange loss of $7.0 million and a credit relating to expiry of performance share rights of $1.9 million.
The Boikarabelo mine's potential continued to be unlocked during the half year. The Boikarabelo mine, in the Waterberg region
of South Africa, has probable reserves of 744.8 million tonnes of coal on 35% of the tenements controlled by the consolidated
entity.
Negotiations with various parties including a club of potential financiers to provide project finance for the construction of the
Boikarabelo mine continued during the period. The process in reaching an agreed term sheet has been protracted due to
several factors including the variable nature of the envisaged loan structure and maintaining deliverable outcomes within
prevailing debt and coal markets. It is proposed that if this facility proceeds, the existing loan from Noble Group will become
part of the above facility.
Expectations are that the project finance will provide all required remaining funding for the mine construction. Consequently, if
the proposed facility is made available, the Company does not envisage the need for an associated equity raising.
While this protracted process is on-going, the Company continues to explore alternate debt funding arrangements to maximise
the chance of finalising the successful development of the Boikarabelo mine.
Construction of some of the mine’s infrastructure continued during the period while project debt funding was being negotiated.
Major construction activities can commence after project funding is finalised. The items that occurred during the period were:
• power supply infrastructure;
• rail installation at the network stabilisation facility (“NSF”); and
• 13 kilometres of water pipeline associated with the effluent treatment plant.
EHL Energy (Pty) Limited completed the erection of power poles and transmission lines for the 132kV power supply. In
addition, the substation and switch room were also completed during the period. The power supply infrastructure is funded by
a deferred payment facility.
At the NSF, the 26 tonne axle load switch and signalling system was installed and commissioned. In addition 400 metres of rail
was installed to allow for construction access for the rest of the railway line system to the mine.
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RESOURCE GENERATION LIMITED
Directors' report (continued)
Review of Operations (continued)
The Marapong effluent treatment facility in Lephalale and the 58 kilometre pipeline to Boikarabelo are an integral part of the
mine’s social and labour plan. Earthworks were previously completed for a 13 kilometre section of the pipeline adjacent to a
main road. Installation of pipes was completed during the period.
Following the Company's receipt of a requisition for a General Meeting from Altius Investment Holdings (Pty) Limited (“Altius”)
to replace the Company's board, the Company submitted an application to the Takeovers Panel seeking a declaration of
unacceptable circumstances in relation to the affairs of the Company with orders that, among other things, the Company's
majority shareholders, Shinto Torii Inc. (a subsidiary of Altius), Noble Group Limited and Public Investment Corporation SOC
Limited, be excluded from voting at the General Meeting. The Takeovers Panel declined to make such an order and, at the
General Meeting held on 26 November 2015, shareholders approved the election of a new board of directors of the Company,
comprising Denis Gately (Chairman), Lulamile Xate (Deputy Chairman), Colin Gilligan, Dr Konji Sebati, Leapeetswe Molotsane
and Robert Croll. The new board appointed Rob Lowe as the interim Chief Executive Officer effective 26 November 2015.
On 25 November 2015, the day prior to the General Meeting, the former Managing Director of the Company approved the
retrenchment of all Sydney office staff. In addition, the former board approved the payment of termination benefits to the two
executive directors in their expectation that their position as directors would be terminated at the General Meeting to be held
the following day. Termination benefits totalling $2,303,504 were paid to the former board members, executives and staff on
the same day. The new board is seeking legal advice in relation to the payment of the termination benefits.
The new board met in South Africa on 14 December 2015 and subsequently the Chairman released a board report to
shareholders on 16 December 2015 outlining the board’s priorities with respect to rebuilding the executive team, meeting with
potential funders, reviewing the Boikarabelo mine architecture and evaluating alternative mine operating models.
Events Occurring after the Balance Sheet Date
There are no matters of significance up to the date of this report that have not been included in the interim financial statements.
Auditor's independence declaration
A copy of the auditor's independence declaration as required under Section 307C of the Corporations Act 2001 is set out on
page 4.
Rounding of amounts
The Company is of a kind referred to in Class Order 98/100, issued by the Australian Securities and Investments Commission,
relating to the rounding off of amounts in the directors' report and financial report. Amounts in the directors' report and financial
report have been rounded off in accordance with that Class Order to the nearest thousand dollars or, in certain cases, to the
nearest dollar.
This report is made in accordance with a resolution of the directors, pursuant to Section 306(3) of the Corporations Act 2001.
D Gately
Chairman
Johannesburg
18 February 2016
Page 3
Deloitte Touche Tohmatsu
A.B.N. 74 490 121 060
Grosvenor Place
225 George Street
Sydney NSW 2000
PO Box N250 Grosvenor Place
The Board of Directors Sydney NSW 1220 Australia
Resource Generation Limited DX 10307SSE
Level 12 Chifley Tower Tel: +61 (0) 2 9322 7000
Fax: +61 (0) 2 9322 7001
2 Chifley Square www.deloitte.com.au
SYDNEY NSW 2000
18 February 2016
Dear Board Members
Resource Generation Limited
In accordance with section 307C of the Corporations Act 2001, I am pleased to provide the
following declaration of independence to the directors of Resource Generation Limited.
As lead audit partner for the review of the financial statements of Resource Generation
Limited for the half-year ended 31 December 2015, I declare that to the best of my
knowledge and belief, there have been no contraventions of:
(i) the auditor independence requirements of the Corporations Act 2001 in relation
to the review; and
(ii) any applicable code of professional conduct in relation to the review.
Yours sincerely
DELOITTE TOUCHE TOHMATSU
Jason Thorne
Partner
Chartered Accountants
Liability limited by a scheme approved under Professional Standards Legislation.
Page 4
Member of Deloitte Touche Tohmatsu Limited
Page 4
RESOURCE GENERATION LIMITED
Condensed consolidated statement of profit or loss and other comprehensive income for the half year ended 31 December 2015
Half year ended
31-Dec-14
31-Dec-15 *Restated
Notes $'000 $'000
Revenue from continuing operations 164 467
Administrative, rent and corporate (792) (479)
Depreciation of property, plant and equipment (172) (161)
Employee benefits expense (2,178) (817)
Finance expenses - (1,439)
Share based compensation credit/(charge) 3 1,873 (779)
Foreign exchange movements 3 (7,010) -
Loss before income tax expense (8,115) (3,208)
Income tax expense - (1)
Loss for the half year (8,115) (3,209)
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Exchange differences on translation of foreign operations 7 (10,632) 2,694
Total comprehensive income for the half year (18,747) (515)
Loss is attributable to:
Owners of Resource Generation Limited (8,115) (3,209)
Total comprehensive income for the half year is attributable to:
Owners of Resource Generation Limited (18,747) (515)
Earnings per share
From continuing operations Cents Cents
Basic loss per share (1.40) (0.55)
Diluted loss per share (1.40) (0.55)
*Please refer to Note 1(c) translation of foreign operations
There is currently no difference between HEPS and EPS.
The above condensed consolidated statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying
notes.
RESOURCE GENERATION LIMITED
Page 5
RESOURCE GENERATION LIMITED
Condensed consolidated statement of financial position
As at 31 December 2015
Notes 31-Dec-15 30-Jun-15
$'000 $'000
Current assets
Cash and cash equivalents 18,315 28,551
Trade and other receivables 93 200
Deposits and prepayments 133 207
18,541 28,958
Non-current assets
Property, plant and equipment 29,277 35,464
Mining tenements and mining development 141,656 140,539
Deposits and loan receivables 16,114 18,484
187,047 194,487
TOTAL ASSETS 205,588 223,445
Current liabilities
Trade and other payables 3,983 7,320
Provisions 343 987
Borrowings 4 5,853 2,661
10,179 10,968
Non-current liabilities
Provisions - 204
Borrowings 4 35,444 31,221
Royalties payable 2,249 2,716
37,693 34,141
TOTAL LIABILITIES 47,872 45,109
NET ASSETS 157,716 178,336
Equity
Issued capital 5 223,622 223,622
Reserves 7 (15,034) (2,529)
Accumulated losses (50,872) (42,757)
TOTAL EQUITY 157,716 178,336
The above condensed consolidated statement of financial position should be read in conjunction with the accompanying notes.
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RESOURCE GENERATION LIMITED
RESOURCE GENERATION LIMITED
Condensed consolidated statement of changes in equity
For the half year ended 31 December 2015
Attributable to owners of Resource Generation Limited
Contributed Retained
Notes equity Reserves earnings Total equity
$'000 $'000 $'000 $'000
Balance as at 1 July 2014 (*restated) 223,622 (10,090) (37,808) 175,724
Loss for the period - - (3,209) (3,209)
Other comprehensive income for the period - 2,694 - 2,694
Total comprehensive income for the period - 2,694 (3,209) (515)
Contributions of equity, net of transaction costs - - - -
Employee share options - value of employee services - 779 - 779
- 779 - 779
Balance at 31 December 2014 (*restated) 223,622 (6,617) (41,017) 175,988
Balance at 1 July 2015 223,622 (2,529) (42,757) 178,336
Loss for the period - - (8,115) (8,115)
Other comprehensive income for the period - (10,632) - (10,632)
Total comprehensive income for the period - (10,632) (8,115) (18,747)
Contributions of equity, net of transaction costs - - - -
Employee share options - value of employee services - (1,873) - (1,873)
- (1,873) - (1,873)
Balance at 31 December 2015 223,622 (15,034) (50,872) 157,716
*Please refer to Note 1(c) translation of foreign operations
The above condensed consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
Page 7
RESOURCE GENERATION LIMITED
Condensed consolidated statement of cash flows
For the half year ended 31 December 2015
Half year ended
31-Dec-15 31-Dec-14
$'000 $'000
Cash flows from operating activities
Payments to suppliers and employees (inclusive of government charges) (4,609) (1,349)
Interest received 130 400
Interest/finance costs paid (3) (104)
Net cash outflow from operating activities (4,482) (1,053)
Cash flows from investing activities
Payments for property, plant and equipment (650) (275)
Receipts for government charges associated with land acquisition (refundable) - -
Payments for licence deposits - (64)
Payments for acquisition of subsidiaries - -
Payments for mining tenements and mining development (5,170) (18,807)
Net cash outflow from investing activities (5,820) (19,146)
Cash flows from financing activities
Proceeds from issue of shares - -
Equity raising costs - -
Repayment of debt (564) -
Loan to BEE partner (69) (98)
Net cash outflow from financing activities (633) (98)
Net decrease in cash and cash equivalents (10,935) (20,297)
Cash and cash equivalents at the beginning of the half year 28,551 54,337
Effects of exchange rate movements on cash and cash equivalents 699 3,864
Cash and cash equivalents at the end of the half year 18,315 37,904
The above condensed consolidated statement of cash flows should be read in conjunction with the accompanying notes.
Page 8
RESOURCE GENERATION LIMITED
Notes to the condensed consolidated financial statements
For the half year ended 31 December 2015
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of preparation of half year financial report
This general purpose financial report for the interim half year reporting period ended 31 December 2015 has been prepared in accordance with AASB 134
Interim Financial Reporting and the Corporations Act 2001. Compliance with AASB 134 ensures compliance with International Financial Reporting
Standard IAS 34 'Interim Financial Reporting'.
This interim financial report does not include all the notes of the type normally included in an annual financial report. Accordingly, this report is to be read in
conjunction with the Annual Report for the year ended 30 June 2015 and any public announcements made by Resource Generation Limited during the
interim reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001.
The interim financial report has been prepared on the basis of historical cost except for the revaluation of certain financial instruments. Cost is based on
the fair values of consideration given in exchange for assets. All amounts are presented in Australian Dollars, unless otherwise noted.
Disclosure surrounding adoption of new or revised Standards
The Group has adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board (AASB) that are
relevant to their operations and effective for the current half-year.
*AASB 2015-3 ‘Amendments to Australian Accounting Standards arising from Withdrawal of AASB 1031 Materiality’
The Company has reviewed the above Accounting Standards and determined that they have no material impact on the interim financial report for the half
year ended 31 December 2015.
The following new accounting standards are not yet effective but may have an impact on the Group in the financial years commencing 1 July 2016 or later:
*AASB 2014-4 ‘Amendments to Australian Accounting Standards – Clarification of Acceptable Methods of Depreciation and Amortisation’
*AASB 2015-1 ‘Amendments to Australian Accounting Standards – Annual Improvements to Australian Accounting Standards 2012-2014’
*AASB 2015-2 ‘Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB 101’
*AASB 9 ‘Financial Instruments’
*AASB 15 ‘Revenue from Contracts with Customers’
*IFRS 16 Leases
The Company is in the process of determining the potential impact of adopting the above standards and they have not been applied in the preparation of
interim financial report for the half year ended 31 December 2015.
(b) Significant accounting policies
The accounting policies and methods of computation adopted in the preparation of the half year financial report are consistent with those adopted and
disclosed in the Company's annual financial report for the year ended 30 June 2015. These accounting policies are consistent with Australian Accounting
Standards and with International Financial Reporting Standards.
The interim financial report comprises the financial statements of Resource Generation Limited and its subsidiaries as at 31 December 2015 ("the
Consolidated Entity").
As at 31 December 2015, the Group had net current assets of $8.4 million and made a loss of $8.1 million for the half year. The Interim Financial Report
has been prepared on a going concern basis, for the half year ended 31 December 2015, after considering the following items:
• Cash position of $18.3 million.
• Key infrastructural aspects have been secured, such as mining rights, offtake agreements, port/rail agreements and water licences obtained.
• Sufficient financing has been secured for the next 12 months.
• Negotiations for project finance to complete the mine project are continuing.
(c) Translation of foreign operations
During the year ended 30 June 2015, the directors changed the method for the translation of foreign operations to be in line with AASB 121 the Effects of
Changes in Foreign Exchange Rates (AASB 121). Certain non-monetary items that were previously translated at historical exchange rates are now
translated using the closing rate at the end of the reporting period as required by AASB 121. This resulted in a restatement in the Group’s 30 June 2015
Annual Report for the years ended 30 June 2014 and 30 June 2013.
To reflect the change above in the interim financial report, the comparative figures in the condensed consolidated statement of profit or loss and other
comprehensive income and the condensed consolidated statement of changes in equity for the half year ended 31 December 2014 have been restated.
Please refer to Note 3(b) in the Group’s 30 June 2015 Annual Report for further details of the restatement.
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RESOURCE GENERATION LIMITED
Notes to the condensed consolidated financial statements
For the half year ended 31 December 2015
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(d) Income Tax
The Directors have not recognised any deferred tax assets in relation to carry forward unused tax losses. Given the history of operating losses, the
Directors have determined that the most appropriate time to regognise deferred tax assets from carry forward unused tax losses is when the mine
commences production.
2. SEGMENT INFORMATION
(a) Description of segments
Management has determined the segments based upon reports reviewed by the Board that are used to make strategic decisions. The Board considers
the business from both a business and geographic perspective, with the Board being the central decision maker.
Business segments
The Group has coal interests in South Africa. The main priority is to develop its coal resources in the Waterberg region of South Africa. Management has
determined mining tenements and mining development and corporate to be the critical reportable segments. Corporate includes equity raisings and
administration costs.
(b) Primary reporting format - business segments
Information regarding these segments is presented below. The accounting of the reportable segments is the same as the Group's accounting policies.
Half year 2015 Mining tenements Corporate Total
Africa Australia
$'000 $'000 $'000
Total segment and consolidated revenue 136 28 164
Loss before income tax (548) (7,567) (8,115)
Income tax expense - - -
Loss for the half year (548) (7,567) (8,115)
Half year 2014 Mining tenements Corporate Total
Africa Australia
*Restated
$'000 $'000 $'000
Total segment and consolidated revenue 313 154 467
Loss before income tax (1,655) (1,553) (3,208)
Income tax expense (1) - (1)
Loss for the half year (1,656) (1,553) (3,209)
3. LOSS FOR THE HALF YEAR Half year ended
31-Dec-15 31-Dec-14
$'000 $'000
Loss for the half year includes the following items that are unusual because of their nature, size or incidence:
Expenses
Share based compensation (credit)/charge (1,873) 779
Foreign exchange movements 7,010 -
4. BORROWINGS 31-Dec-15 30-Jun-15
$'000 $'000
Current liabilities/ Borrowings - unsecured 5,853 2,661
5,853 2,661
Non-current liabilities/ Borrowings - unsecured 35,444 31,221
35,444 31,221
Page
10
RESOURCE GENERATION LIMITED
Notes to the condensed consolidated financial statements
For the half year ended 31 December 2015
4. BORROWINGS (continued)
Noble Loan
A binding term sheet for a US$65 million loan from Noble Group for construction of the infrastructure of the Boikarabelo mine was signed on 31 December
2013. US$20 million of the Noble Group rail loan was drawn down in March 2014. The loan is unsecured and interest is payable at 10.75%, repayable
from June 2016 in quarterly instalments.
EHL Loan
EHL Energy (Pty) Limited are building the electricity sub-station at the Boikarabelo mine which connects the mine to the grid. The construction is subject to
a deferred payment plan, with interest payable at the ABSA Bank prime lending rate plus 3%. The loan is unsecured and repayable in 16 quarterly
instalments from November 2015.
5. EQUITY SECURITIES ISSUED
31-Dec-15 30-Jun-15 31-Dec-15 30-Jun-15
Shares Shares $'000 $'000
Opening balance 581,380,338 581,380,338 223,622 223,622
Issues of ordinary shares - - - -
Closing balance 581,380,338 581,380,338 223,622 223,622
6. DEVELOPMENT PARTNERS
31-Dec-15 30-Jun-15
Interest Interest
% %
Waterberg One Coal (Pty) Limited 74 74
Ledjadja Coal (Pty) Limited 74 74
7. RESERVES
31-Dec-15 30-Jun-15
$'000 $'000
Reserves
Other contributed equity 1,085 1,085
Treasury shares (2,317) (2,317)
Share based payment reserve 18,421 20,294
Foreign currency reserve (32,223) (21,591)
(15,034) (2,529)
Movements in reserves
Other contributed equity
Opening Balance 1,085 1,085
Movement - -
Closing Balance 1,085 1,085
Treasury shares
Opening Balance (2,317) (2,317)
Movement - -
Closing Balance (2,317) (2,317)
Share based payment reserve
Opening Balance 20,294 19,497
Movement (1,873) 797
Closing Balance 18,421 20,294
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11
RESOURCE GENERATION LIMITED
Notes to the condensed consolidated financial statements
For the half year ended 31 December 2015
7. RESERVES (continued)
31-Dec-15 30-Jun-15
$'000 $'000
Foreign currency reserve
Opening Balance (21,591) (28,355)
Movement (10,632) 6,764
Closing Balance (32,223) (21,591)
The movement in the foreign currency translation reserve reflects the depreciation of the South African Rand against the Australian Dollar in the six
months since 30 June 2015.
8. COMMITMENTS
Capital commitments
The Group has $4.4 million (2014 $14.1 million) in commitments in respect of the development of the Boikarabelo mine.
9. EVENTS OCCURRING AFTER THE BALANCE SHEET DATE
There are no matters of significance up to the date of this report that have not been included in the interim financial statements.
Page
12
RESOURCE GENERATION LIMITED
Directors' declaration
In the directors' opinion:
(a) there are reasonable grounds to believe that Resource Generation Limited will be able to pay its debts as and when they become due and payable.
(b) the financial statements and notes set out on pages 5 to 12 are in accordance with the Corporations Act 2001, including compliance with accounting standards
and giving a true and fair view of the financial position and performance of the consolidated entity.
This declaration is made in accordance with a resolution of the directors, pursuant to Section 303(5) of the Corporations Act 2001.
D Gately
Chairman
Johannesburg
18 February 2016
JSE Sponsor: Deloitte & Touche Sponsor Services (Pty) Ltd
Page 13
Deloitte Touche Tohmatsu
ABN 74 490 121 060
Grosvenor Place
225 George Street
Sydney NSW 2000
PO Box N250 Grosvenor Place
Sydney NSW 1220 Australia
Tel: +61 2 9322 7000
Fax: +61 9322 7001
www.deloitte.com.au
Independent Auditor’s Review Report
to the members of Resource Generation Limited
Report on the Half-Year Financial Report
We have reviewed the accompanying half-year financial report of Resource Generation Limited,
which comprises the condensed statement of financial position as at 31 December 2015, and the
condensed statement of profit or loss and other comprehensive income, the condensed statement of
cash flows and the condensed statement of changes in equity for the half-year ended on that date,
notes comprising a summary of significant accounting policies and other explanatory information,
and the directors’ declaration of the consolidated entity comprising the company and the entities it
controlled at the end of the half-year or from time to time during the half-year as set out on pages 5
to 13.
Directors’ Responsibility for the Half-Year Financial Report
The directors of the company are responsible for the preparation of the half-year financial report
that gives a true and fair view in accordance with Australian Accounting Standards and the
Corporations Act 2001 and for such internal control as the directors determine is necessary to
enable the preparation of the half-year financial report that gives a true and fair view and is free
from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express a conclusion on the half-year financial report based on our review.
We conducted our review in accordance with Auditing Standard on Review Engagements ASRE
2410 Review of a Financial Report Performed by the Independent Auditor of the Entity, in order to
state whether, on the basis of the procedures described, we have become aware of any matter that
makes us believe that the half-year financial report is not in accordance with the Corporations Act
2001 including: giving a true and fair view of the consolidated entity’s financial position as at 31
December 2015 and its performance for the half-year ended on that date; and complying with
Accounting Standard AASB 134 Interim Financial Reporting and the Corporations Regulations
2001. As the auditor of Resource Generation Limited, ASRE 2410 requires that we comply with
the ethical requirements relevant to the audit of the annual financial report.
A review of a half-year financial report consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit conducted in accordance with
Australian Auditing Standards and consequently does not enable us to obtain assurance that we
would become aware of all significant matters that might be identified in an audit. Accordingly,
we do not express an audit opinion.
Liability limited by a scheme approved under Professional Standards Legislation.
Member of Deloitte Touche Tohmatsu Limited.
Page 14
Auditor’s Independence Declaration
In conducting our review, we have complied with the independence requirements of the
Corporations Act 2001. We confirm that the independence declaration required by the
Corporations Act 2001, which has been given to the directors of Resource Generation Limited,
would be in the same terms if given to the directors as at the time of this auditor’s review report.
Conclusion
Based on our review, which is not an audit, we have not become aware of any matter that makes us
believe that the half-year financial report of Resource Generation Limited is not in accordance
with the Corporations Act 2001, including:
(a) giving a true and fair view of the consolidated entity’s financial position as at 31 December
2015 and of its performance for the half-year ended on that date; and
(b) complying with Accounting Standard AASB 134 Interim Financial Reporting and the
Corporations Regulations 2001.
DELOITTE TOUCHE TOHMATSU
Jason Thorne
Partner
Chartered Accountants
Sydney, 18 February 2016
Page 15
RESOURCE GENERATION LIMITED
Supplementary Information - Presentation of financial information in South African Rand
The presentation currency used in the preparation of the financial statements is the Australian dollar ($A). The Group has translated the financial
statements to the South African (SA) Rand (ZAR) because the Boikarabelo mine, which represents the Group's most significant activity, is located in this
region. This supplementary information has restated the financial statements in Rand. Assets and liabilities were translated in SA Rand using the relevant
closing rate of exchange and income and expense items were translated using the relevant cumulative average rate of exchange. The applicable rates
used in the restatement of information are as follows:
Dec-15 Jun-15 Dec-14
Average rate of exchange $A/Rand 9.8365 9.4870 9.7240
Closing rate of exchange $A/Rand 11.317 9.3730 9.4359
Consolidated Statements of Comprehensive Income - ZAR Convenience Translation (Supplementary Information)
For the half year ended 31 December 2015
Half year ended
2015 2014
R'000 R'000
Revenue from continuing operations 1,613 4,541
Administration, rent and corporate (7,791) (4,657)
Depreciation of property, plant and equipment (1,692) (1,566)
Employee benefits expense (21,424) (7,945)
Finance expenses - (7,575)
Share based compensation credit/(charge) 18,424 (13,993)
Foreign exchange movements (68,954) -
Loss before income tax expense (79,824) (31,195)
Income tax expense - (10)
Loss from continuing operations (79,824) (31,205)
(79,824) (31,205)
Loss for the half year
Other comprehensive income
Items that may be reclassified subsequently to profit or loss (104,582) 26,196
Exchange differences on translation of foreign operations
(184,406) (5,009)
Total comprehensive income for the half year
Loss is attributable to: (79,824) (31,205)
Owners of Resource Generation Limited
Total comprehensive income for the year is attributable to: (184,406) (5,009)
Owners of Resource Generation Limited
Rand Rand
Earnings per share
From continuing operations
Basic loss per share (13.8) (5.3)
Diluted loss per share (13.8) (5.3)
Page 16
RESOURCE GENERATION LIMITED
Consolidated Statements of Financial Position - ZAR Convenience Translation (Supplementary Information)
As at 31 December 2015
31-Dec-15 30-Jun-15
R'000 R'000
Current assets
Cash and cash equivalents 207,271 267,609
Trade and other receivables 1,052 1,874
Deposits and prepayments 1,505 1,940
209,828 271,423
Non-current assets
Property, plant and equipment 331,328 332,404
Mining tenements and mining development 1,603,121 1,317,272
Deposits and loan receivables 182,362 173,250
2,116,811 1,822,926
TOTAL ASSETS 2,326,638 2,094,349
Current liabilities
Trade and other payables 45,076 68,610
Provisions 3,882 9,250
Borrowings 66,238 24,943
115,196 102,803
Non-current liabilities
Provisions - 1,913
Borrowings 401,120 292,634
Royalties payable 25,452 25,457
426,572 320,004
TOTAL LIABILITIES 541,768 422,807
NET ASSETS 1,784,870 1,671,542
Equity
Contributed equity 2,530,730 2,229,377
Reserves (170,141) (157,074)
Accumulated losses (575,719) (400,761)
TOTAL EQUITY 1,784,870 1,671,542
Page 17
RESOURCE GENERATION LIMITED
Consolidated statement of cash flow - ZAR Convenience Translation (Supplementary Information)
For the half year ended 31 December 2015
Half year ended
2015 2014
R'000 R'000
Cash flows from operating activities
Payments to suppliers and employees (inclusive of government charges) (45,336) (13,118)
Interest received 1,279 3,890
Interest paid (30) (1,011)
Net cash outflow from operating activities (44,087) (10,239)
Cash flows from investing activities
Payments for land, property, plant and equipment (6,394) (2,674)
Receipt for government charges associated with land acquisition - -
Payments for licence deposits - (622)
Payments for acquisition of subsidiaries - -
Payments for mining tenements and mining development (50,855) (182,879)
Net cash outflow from investing activities (57,248) (186,175)
Cash flows from financing activities
Proceeds from issue of shares - -
Equity raising costs - -
Repayment of debt (5,548) -
Loan to BEE partner (679) (953)
Net cash outflow from financing activities (6,227) (953)
Net decrease in cash and cash equivalents (107,562) (197,367)
Cash and cash equivalents at the beginning of the half year 267,609 541,707
Effects of exchange rate movements on cash and cash equivalents 47,224 13,318
Cash and cash equivalents at the end of the half year 207,271 357,658
Page 18
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