MMH - Miranda Mineral Holdings Limited - Business update and Trading Statement

Release Date: 06/10/2011 17:46
Code(s): MMH
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MMH - Miranda Mineral Holdings Limited - Business update and Trading Statement Miranda Mineral Holdings Limited (Incorporated in the Republic of South Africa) Registration number: 1998/001940/06) Share code: MMH ISIN: ZAE000074019 ("Miranda" or "the Company" or "the Group") BUSINESS UPDATE AND TRADING STATEMENT Following recent changes to the board of directors of the Company ("Board") and executive management team, the Board initiated an investigation into several matters of the Company including a detailed review and verification of some of the Company`s assets. The Board has obtained material information regarding the Company`s prospecting right for its Rozynenbosch lead, silver and zinc deposit (the "Prospecting Right") located in the Northern Cape Region. The original application for the conversion of the Old Order Prospecting Right was submitted on 28 April 2005, before MMH listed on the JSE Limited on 19 December 2005. The application was, however, refused on 5 July 2006 by the Department of Minerals & Energy. In the 2006 Annual Report, the Company advised that it was of the opinion that the grounds for the refusal of the Prospecting Right application was unfounded and that it had lodged an appeal against the decision and would take legal action to ensure the timeous conversion of the right. In October 2010, the Company received confirmation from the Department of Mineral Resources ("DMR") that the appeal against its refusal of the Prospecting Right was part of a large inherited backlog and was receiving urgent attention. Accordingly, in the 2010 Annual Report the Company advised that the Company had put its appeal process against Government on hold pending further information and that the Board was monitoring the situation on an ongoing basis and would make further announcements to shareholders as soon as any of the facts related to the matter changed. It was further noted that in the event of the Prospecting Right not being granted to Miranda, it could result in an impairment of up to R284 million. The board has since established that the Prospecting Right was in fact awarded to a third party in November 2007 (The DMR Website). The company met formally with the DMR on 05 October 2011 and confirmed this position. The Board is of the view that the Company should have removed the Prospecting Right in the amount of R284 million as an asset on its balance sheet commencing in 2006, in the same financial year in which it was refused. The Board has accordingly resolved to remove the Prospecting Right as an asset from the company`s balance sheet. This will have an effect of reducing the net asset value of the Company by approximately R285 million. As a result of the above, a review of the financial results by management has indicated that for the year ending 31 August 2011, the net asset value per share is expected to be between 80% and 89% lower when compared to the same reporting period in the previous year. The financial information on which this trading statement is based has not been reviewed by the Group`s auditors and the results for the year ending 31 August 2011 are expected to be released during the course of November 2011. Shareholders are assured that t
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