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CENTRAL RAND GOLD LIMITED - Operational Update and Board Changes

Release Date: 22/12/2015 09:00:00      Code(s): CRD       PDF(s):  
Operational Update and Board Changes

Central Rand Gold Limited
(Incorporated as a company with limited liability under the laws of Guernsey,
Company Number 45108)
(Incorporated as an external company with limited liability under the laws of South Africa,
Registration number 2007/0192231/10)
LSE share code: CRND JSE share code: CRD
("Central Rand Gold" or the “Company”)


Central Rand Gold, the South African gold mining and exploration holding company, announces an
operational update and changes to the board of directors of Central Rand Gold (the “Board”).

Central Rand Gold Limited has previously announced that it had launched a process to review various
strategic and funding options (the “Process”) available to it, which followed approaches made by four
individual Asian investors groups (“Asian Investor Groups”).

Much of the engagement from the Asian Investor Groups focused on a potential sale of Central Rand Gold
(Netherlands Antilles) N.V., although in recent months the concept of a strategic investment has also been

The Company conducted a thorough review and has been encouraged by the significant level of interest
from, and engagement with, the Asian Investor Groups, along with other counter-parties throughout the
Process. In particular, the Company is pleased with the receipt of indicative proposals from Hiria Group
Company Limited and Huili Resources Group Limited which the Company has sought to clarify and finalise
over recent months. However, the significant uncertainty caused by falling commodity prices and difficult
market conditions across the junior mining sector, along with company specific factors such as the continued
dewatering of the Central Basin, has meant that to date no unconditional and appropriately valued proposals
have been received which the Board believes might lead to a transaction which could be completed within a
reasonable period of time.

Specifically, the gold price has fallen in recent times along with a wide spread sell off in junior gold miners,
which has resulted in companies across the sector reducing capital expenditure and delaying investment
decisions pending an improvement in underlying market conditions.

Consequently, the Board has terminated the Process relating to the sale of Central Rand Gold (Netherlands
Antilles) N.V. with immediate effect as it believes its continuation will unnecessarily prolong shareholder
uncertainty with no immediate prospect of a satisfactory outcome. The Company will continue to engage with
the Asian Investor Groups should the prospects for the completion of a transaction involving the sale of
Central Rand Gold (Netherlands Antilles) N.V. improve.

The Company continues to negotiate with one Asian Investor regarding a strategic investment into Central
Rand Gold Limited. This negotiation will continue in parallel with discussions with other third party investors,
to provide funding in order to pursue growth opportunities for the Company.

The Company remains well positioned to benefit from the improvements and upgrades made to the
Company’s metallurgical plant during 2014 and 2015 and the identification of internal and external sources of
economic surface and open pit gold bearing material.

Dewatering of the Central Basin and access to the significant underground reserves remains a key focus in
realising the long term objectives of the Company. During 2015, the water table has receded 13 vertical
meters to approximately 143 meters below surface. Recent upgrades to the water treatment plant have
largely been completed and the water table rate of decline is expected to increase during 2016.
In the interim, an extensive surface exploration program has been undertaken and a number of near surface
opencast opportunities have been identified. The Company is presently mining two opencast slots (namely
Slot 5 and Slot 7) and plans to develop an additional opencast slot in 2016. Having additional sources of
open pit material will make the delivery of ore to the metallurgical plant more reliable and consistent.

The Company expects that the already identified opencast operations will provide sufficient material at an
acceptable grade so as to allow for continued operation of the mine for a number of years. The management
team remains optimistic regarding the viability of the surface mining strategy and is committed to optimise
this further. This is however, seen as an interim measure whilst dewatering of the underground operations

The Company continues to identify and source additional material from external sources to supplement the
opencast operations. The opportunity to secure material from external sources is significant and the
Company continues to advance discussions with various parties involving significant quantities of ore bearing

The metallurgical plant continues to operate satisfactorily with continual sustainable improvements being
realized. Furthermore, the cost structure of Central Rand Gold’s operations continues to be reviewed with
emphasis on unit efficiencies, a flatter management structure and improving production output. Recent
changes to the management team are already indicating improved results and further optimisation is

The Board has today announced the resignation of Johan du Toit as Chief Executive Officer effective from
31 December 2015. Mr. du Toit has decided to resign from the Board to pursue other opportunities.

Over the past three months Mr. Allen Phillips, Non Executive Director of the Company, has been performing
a more hands-on role in the operations of the Company, and will be appointed Interim Chief Executive, whilst
the Company undertakes a search to identify a new Chief Executive in 2016. Mr. Phillips joined the Board in
May 2014 and has continued to advise the Company on the continued refinement of the Company’s
metallurgical plant during the latter half of 2014 and throughout 2015. These improvements have increased
plant availability and gold recoveries which have translated into improved economic performance of the
Company over this period.

The Company is also pleased to announce the appointment of Mr. Mark Austin as a Non-Executive Director
to the Board. As the Company continues to look at opencast and surface opportunities in order to expand
gold production, it has strengthened the operational and technical expertise of the Board with this

Mr. Austin has enjoyed a distinguished career as a senior mining executive with a specific focus on operating
gold assets throughout Africa. Mr. Austin is Senior Partner at Applied Geology and Mining Proprietary
Limited and previously had been chief executive officer of Kilimapesa Gold Limited, a subsidiary of Goldplat
Plc from 2007 to 2013.

The Company is also pleased to announce the appointment of Miss Lola Trollip as Chief Financial Officer
and member of the Executive Committee of the Company, which reports to the Board of Central Rand Gold.
Miss Trollip was previously a Senior Finance Executive with Norilsk Nickel Africa where she was responsible
for the finance discipline of all the Norilsk Nickel African operations which included the Nkomati Mine, Tati
Mine and Norilsk Nickel Burundi.

Commenting on Mr. Austin’s appointment, Nathan Taylor, the interim Chairman, said "I'd like to welcome
Mark to the Central Rand Gold Board. As the Company continues to build its production profile, both
organically and through acquisition, Mark’s comprehensive technical knowledge and extensive operating
experience throughout Africa will be invaluable in assisting Central Rand Gold achieve our vision of building
an emerging mid-tier gold mining company.

Central Rand Gold’s Interim Chairman, Nathan Taylor, commented “The Company is appreciative of the
contribution and service Mr. du Toit has made to the Company over his 7 years of service. We wish him all
the best for his future endeavours. We are very excited about the more direct role Mr. Phillips will play in the
Company. Allen has been instrumental in the significant improvement of the metallurgical plant and we look
forward to his increased level of involvement going forward throughout this interim period.

I would also like to welcome Mark Austin to the Central Rand Gold Board. As the Company continues to
build its production profile, both organically and through acquisition, Mark’s comprehensive technical
knowledge and extensive operating experience throughout Africa will be invaluable in assisting Central Rand
Gold achieve its vision of building an emerging mid-tier gold mining company.”

AIM Rule 17

Save for the information below, there are no further disclosures to be made in accordance with Rule 17,
Schedule Two paragraph (g) of the AIM Rules for Companies in respect of the appointment of Mark Austin,
who is aged 57.

Current directorships:
Applied Geology & Mining Proprietary Limited
Crimson King Properties 361 Proprietary Limited

Past Directorships (within 5 years):
Kilimapesa Gold Proprietary Limited
Ausmin Consulting CC

For further information, please contact:

Central Rand Gold                                      +27 (0) 87 310 4400
Nathan Taylor / Allen Phillips

Panmure Gordon (UK) Limited                            +44 (0) 20 7886 2500
Mark Taylor / James Greenwood

Merchantec Capital                                     +27 (0) 11 325 6363
Monique Martinez / Marcel Goncalves

22 December 2015

Merchantec Capital

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