TIDMFDI
RNS Number : 4488C
Firestone Diamonds PLC
13 November 2009
Firestone Diamonds plc
Preliminary announcement of results for the year ended 30 June, 2009
LONDON: 13 November, 2009
The Board of Firestone Diamonds plc, ("Firestone" or "the Company"), the
AIM-quoted diamond mining and exploration company (ticker: AIM:FDI), announces
preliminary audited results for the year ended 30 June, 2009.
HIGHLIGHTS
BK11 Kimberlite Project
+---+---+-------+----------------------------------------------------------------------------------+
| | - | Inferred resource of 12 million tonnes defined containing approximately 830,000 carats |
+---+---+------------------------------------------------------------------------------------------+
| | - | High grade and diamond values recovered |
+---+---+------------------------------------------------------------------------------------------+
| | | | -potential revenue over $20M per annum at margins in excess of 50% |
+---+---+-------+----------------------------------------------------------------------------------+
| | - | Final phase of evaluation nearing completion |
+---+---+------------------------------------------------------------------------------------------+
| | | | -results to date in line with expectations |
+---+---+-------+----------------------------------------------------------------------------------+
| | | | -mine development decision on target to be made in Q4 2009 |
+---+---+-------+----------------------------------------------------------------------------------+
| | | | -environmental Impact Assessment recently approved, and mining lease application |
| | | | being readied for submission in Q4 2009 |
+---+---+-------+----------------------------------------------------------------------------------+
| | - | Production could commence in mid 2010 |
+---+---+------------------------------------------------------------------------------------------+
| | | | -development costs fully funded by proceeds of July 2009 placing |
+---+---+-------+----------------------------------------------------------------------------------+
Jwaneng Tailings Project
+---+---+----------------------------------------------------------------------------------------+
| | - | Selected as preferred bidder for tailings treatment project at the Jwaneng Mine in |
| | | Botswana in February 2009 |
+---+---+----------------------------------------------------------------------------------------+
| | - | Contract signing expected in Q1 2010 due to delays in finalising project financing |
| | | structure |
+---+---+----------------------------------------------------------------------------------------+
| | - | Initial production of 2 million tonnes per annum targeted to commence in 2011 |
+---+---+----------------------------------------------------------------------------------------+
Tsabong Kimberlite Field
+---+---+----------------------------------------------------------------------------------------+
| | - | Macrodiamonds recovered from five of six kimberlites sampled |
+---+---+----------------------------------------------------------------------------------------+
| | - | Good results from MK1 kimberlite |
+---+---+----------------------------------------------------------------------------------------+
| | - | 79 additional kimberlites to be evaluated |
+---+---+----------------------------------------------------------------------------------------+
| | - | Joint venture discussions continuing |
+---+---+----------------------------------------------------------------------------------------+
Financial
+---+---+----------------------------------------------------------------------------------------+
| | - | Revenue increased 22% to GBP4m (2008: GBP3.3m) |
+---+---+----------------------------------------------------------------------------------------+
| | - | Operating profit of GBP0.7 million before impairment charges (2008: Profit of GBP2.1m) |
+---+---+----------------------------------------------------------------------------------------+
| | - | South African alluvial assets fully impaired, resulting in GBP11.2 million charge for |
| | | the year |
+---+---+----------------------------------------------------------------------------------------+
| | - | GBP5.0 million equity financing completed in July 2008 |
+---+---+----------------------------------------------------------------------------------------+
| | - | GBP7.2 million equity financing completed in July 2009 |
+---+---+----------------------------------------------------------------------------------------+
Outlook
+---+---+----------------------------------------------------------------------------------------+
| | - | Primary focus on development of a new mining operation at BK11 and concluding Jwaneng |
| | | tailings contract in 2010 |
+---+---+----------------------------------------------------------------------------------------+
| | - | Target development of Orapa satellite mining operation around BK16 and other Orapa |
| | | kimberlites |
+---+---+----------------------------------------------------------------------------------------+
| | - | At advanced stage in negotiations for new kimberlites in the Orapa area |
+---+---+----------------------------------------------------------------------------------------+
| | - | In discussions on significant new toll treatment project |
| | | |
+---+---+----------------------------------------------------------------------------------------+
| | - | In discussions on significant new toll treatment project |
+---+---+----------------------------------------------------------------------------------------+
| | - | Company well funded and confident about prospects in Botswana |
+---+---+----------------------------------------------------------------------------------------+
Philip Kenny, CEO of Firestone Diamonds, commented: "We are very pleased with
the progress that we have made in Botswana over the past year. We continue to
work towards making a mine development decision on BK11 before the end of 2009
and to signing an agreement with Debswana on the Jwaneng tailings project in
2010. With funding in place to cover mine development costs at BK11, and with
prices in the rough diamond market continuing to recover from their recent lows,
we remain confident about Firestone's prospects."
Dear Shareholder,
We are pleased to report that Firestone continued to make good progress in the
growth and development of its project portfolio during the past year.
Activities were primarily focused on Botswana, which is the world's largest and
lowest cost producer of diamonds. Firestone is the largest holder of diamond
exploration rights in Botswana's kimberlite fields, with approximately 25,000
square kilometres now under license, and has 95 known kimberlites within its
licence areas.
Overview
The most significant developments during the year were at BK11 in the Orapa area
of Botswana, where evaluation results confirmed that the project has significant
economic potential. The high grade areas identified at BK11 could produce
annual revenues of over $20 million per annum at operating margins of in excess
of 50%. Subject to the results of the final phase of evaluation which is nearing
completion, BK11 could be brought into production in mid 2010.
The Company's objective in the Orapa area will be to use a new mining operation
at BK11 as the centre of a satellite mining operation that would exploit
multiple kimberlites in the area. Evaluation work on the nearby BK16 kimberlite,
which is believed to have similar potential to BK11, is planned to be undertaken
in 2010. The Company has six other kimberlites in the Orapa area and is also at
an advanced stage in negotiations in relation to a number of other kimberlites
in the area which have been proven to be diamondiferous. The Company believes
that it has the potential to develop a sizeable operation in the Orapa area
based on BK11 and these other kimberlites.
The Company has continued to pursue new toll treatment opportunities, which are
increasingly attractive in the current economic environment as a source of
consistent and predictable revenue and cash flow. In February 2009, the Company
announced that it had been selected by Debswana Diamond Company ("Debswana") to
design, construct and operate a tailings plant at the Jwaneng Mine in Botswana
on a toll treatment basis. Contract negotiations have not yet been concluded
due to delays in finalising project financing structure, but are now at an
advanced stage and expected to be concluded in Q1 2010, rather than Q4 2009. The
Company is also in discussions in relation to another significant toll treatment
project on which we expect to be able to provide more information to
shareholders shortly.
Good results were obtained from bulk sampling carried out at Tsabong during the
year. While the Company considers Tsabong to be one of the most attractive large
scale diamond exploration and evaluation projects in the market and to have the
potential to contain significant economic kimberlites, it was decided to focus
the Company's resources on BK11 and toll treatment projects, and to seek a joint
venture partner for Tsabong. A number of joint venture offers have been
received, but not yet on terms acceptable to the Company, and discussions are
continuing.
The past year has been a very challenging one for companies in the diamond
mining and exploration sector and we believe that it is likely that many of the
companies in our sector will not remain independent, due to continued scarcity
of both debt and equity finance. In that context, the fact that Firestone
successfully raised GBP7.2 million in July 2009 reflects the high quality of the
Company's project portfolio and capability of our management team.
With finance now in place to fund the development of commercial mining
operations on BK11, a number of exciting opportunities available to us and a
significant shortfall in rough diamond supply projected in the coming years, we
remain confident about Firestone's future prospects.
BK11, Botswana
Excellent progress was made on BK11, with approximately 2,300 metres of
percussion, core and 36 inch large diameter drilling ("LDD") completed during
the year. Independent modelling of grade and diamond values resulted in the
definition of an inferred resource of 12 million tonnes containing approximately
830,000 carats and a diamond value of $135/carat, which is a very high value for
kimberlite production.With revenue estimates of between $13 and $17 per tonne
for the KW zone, which is the area initially targeted for development, and with
low operating costs in the Orapa area of approximately $6.50 per tonne, the
economic potential of BK11 looks very promising.
Final phase of evaluation under way
A pilot production plant and earthmoving equipment were relocated from the
Company's operations in South Africa in May 2009 and are being used to carry out
the final phase of evaluation on BK11. The objective of this phase is to
recover a sufficiently large parcel of diamonds to obtain a high confidence
diamond valuation. Grade and diamond quality from material processed to date
have been in line with expectations, and the Company expects to be in a position
to make a decision to commence mine development based on the results of this
work in Q4 2009, subject to which production is expected to commence in mid
2010.
Mine development planning advancing
The Company has continued to advance its planning and preparations for the
development of a commercial mining operation on BK11. The required development
costs of approximately GBP5 million are fully financed from the proceeds of the
share placing that was completed in July 2009.
Much of the infrastructure established to support the pilot production plant has
been designed to support full scale mining operations. The mining equipment
currently on site is expected to be sufficient to deliver the mine production
target of 1.5 million tonnes per annum, and sufficient water supply and storage
capacity is now in place to support commercial production. Work on preparing
the production plant at the Company's Bonte Koe Mine in South Africa for
relocation to BK11 is at an advanced stage and ahead of schedule.
The Environmental Impact Assessment for BK11 has recently been approved by the
Department of Environmental Affairs. Discussions have also commenced with the
Department of Mines in relation to a mining lease application, and it is
expected that the application will be ready for submission by the end of the
2009.
Jwaneng Tailings Project, Botswana
In February 2009, Firestone announced that it had been selected by Debswana as
the preferred bidder to supply, construct and operate a modular tailings
treatment plant at the Jwaneng Mine in Botswana on a toll treatment basis.
Debswana is a joint venture between the Government of the Republic of Botswana
and De Beers and is the world's leading diamond producer by value. Jwaneng is
the largest diamond mine in the world by value and in 2008 produced
approximately 13 million carats, with an estimated value of $1.8 billion.
The Jwaneng plant is intended to serve as a pilot facility to demonstrate the
economics and capability of the modular plant concept on the Jwaneng tailings
resource, which is estimated to be in excess of 30 million tonnes. The plant is
being designed by ADP Projects, with whom Firestone has a strategic alliance to
jointly design, build and operate modular diamond tailings processing plants.
Detailed design work commenced in April 2009 and is now at an advanced stage.
Firestone and Debswana have established a joint steering committee for the
project to negotiate and agree detailed technical and commercial provisions for
the project. While technical discussions in relation to the operating contract
for the plant have reached an advanced stage, discussions with Debswana on
structure of the financing that will be required for the project's estimated $40
million capital cost have taken longer than anticipated. Although Debswana and
Firestone have now agreed on the financing structure, the target date for
finalising and signing an agreement has been delayed as a result from Q4 2009 to
Q1 2010. Discussions have also progressed well with a number of interested
lenders in relation to providing debt financing for the project through a
special purpose vehicle.
Based on contract rates from the Company's previous toll treatment operations in
South Africa, the Directors anticipate that the Jwaneng tailings project has the
potential to contribute approximately $150 million in toll treatment revenue for
the Company. The successful implementation of this project could potentially
lead to the deployment by Firestone of similar plants to exploit additional
tailings resources at Debswana's other mines at Orapa and Letlhakane. With the
total tailings resources at Debswana's mines estimated to be approximately 300
million tonnes, the Directors estimate that they represent a very significant
revenue opportunity for the Company.
BK16, Botswana
In June 2008, the Company entered into an agreement under which it can earn an
87.5% interest in the BK16 kimberlite, which is located 20 kilometres from BK11.
The Company believes that BK16 has similar economic potential to BK11. BK16 was
discovered by De Beers in the 1970's and a grade of 15 carats per hundred tonnes
("cpht") was reported from bulk sampling. Diamonds recovered by the limited
historical sampling carried out were predominantly high quality, white
gemstones, which indicates that they are likely to have a high average value,
possibly similar to BK11. The Company drilled three core holes on BK16 during
the year for a total of 620 metres.
Based on a review of drilling and geophysical surveys undertaken on BK16,
Company estimates indicate that it contains approximately 17 million tonnes of
kimberlite to a depth of 200 metres. The Company plans to carry out evaluation
and resource development work on BK16 in 2010. This work will comprise large
diameter drill bulk sampling in order to provide an estimate of grade and
diamond value, and will be undertaken after a mine development decision is made
on BK11.
Tsabong, Botswana
Tsabong is the Company's biggest kimberlite exploration and evaluation project.
It contains 85 known kimberlites, including the 180 hectare MK1 kimberlite which
is one of the world's largest known diamondiferous kimberlites.
Evaluation work at Tsabong during the year was focused on completion of LDD
sampling on six of the fourteen high interest kimberlites that have been
identified to date. Processing of these samples was completed in Q1 2009, with
encouraging results. Macrodiamonds were recovered from five of the six
kimberlites sampled, with MK1 producing 19 macrodiamonds, all clear, white
gemstones, from one of the two LDD holes drilled. When combined with the
recovery of 252 microdiamonds from core drilling, from which a macrodiamond
grade estimate of 25 cpht was made, and analyses of indicator mineral chemistry,
these results support the Company's belief that MK1 has significant economic
potential.The recovery of six macrodiamonds from a small sample and a
microdiamond grade estimate of 25 to 30 cpht from MK38 are also considered very
encouraging.
With eight more high interest kimberlites awaiting bulk sampling, a further 71
kimberlites to evaluate and the likelihood of new discoveries being made with
over 80 known geophysical drill targets, the Company continues to believe that
the Tsabong kimberlite field has significant economic potential.
In December 2008 the Company announced that it intended to focus its resources
on more advanced projects that were closer to cash flow, such as BK11, and that
it would consider the introduction of a joint venture partner to finance further
work on Tsabong. Interest in the project has been high and negotiations have
been undertaken with a number of potential joint venture partners. A number of
joint venture offers have been received, but not on terms acceptable to the
Company and discussions are continuing. Should the Company not receive a joint
venture offer that it considers acceptable, we will consider the alternative of
continuing our own evaluation work at Tsabong once cash flow from the Company's
Botswana operations allows.
South African Operations
During the first half of the year the Company's operations in South Africa were
focused on the toll treatment joint venture with De Beers at the Bonte Koe Mine,
which operated successfully at its target production capacity. At the beginning
of 2009 De Beers elected to terminate the toll treatment agreement as a result
of a decrease in diamond prices and an increase in mining costs. De Beers made a
payment of approximately GBP2.3 million to the Company as compensation for early
termination. The Bonte Koe plant and infrastructure are now being readied for
relocation to BK11, subject to results from the final phase of evaluation work
on the project.
With the Company's operations now focused primarily on kimberlite projects in
Botswana, the Company carried out a review during the year of its South African
alluvial diamond assets, which are considered to be non-core. The Company has
been seeking to either sell or joint venture these assets, but due to the
downturn in the diamond market over the past year, which has had a particularly
severe impact on alluvial diamond producers, there is little interest in
projects of this nature currently. While this position may change as the diamond
market continues to recover, the Company has decided to make a full impairment
provision in respect of its South African minerals rights.
Financial
Revenue for the year increased 22% to GBP4 million due to the termination
payment from De Beers in relation to the Bonte Koe toll treatment project.The
Company produced an operating profit of GBP0.7 million before impairment charges
of GBP11.2 million related to its South African alluvial assets.
In July 2008 the Company raised GBP5 million from a share placement to finance
exploration and evaluation expenditures in Botswana. In July 2009 the Company
raised a further GBP7.2 million from a share placement to finance the
development and commissioning of a mine at BK11, to undertake evaluation and
resource development work at BK16, and to provide general working capital for
the Company.
Diamond market
While prices for rough diamonds increased during the year and reached a record
high in the first half of 2008, they subsequently fell by about 50% during the
last quarter of 2008. This fall was primarily due to severe restrictions in
credit availability to the rough diamond market, which caused very substantial
drops in trading activity. Wholesale prices for polished diamonds fell by about
20% over the same period, reflecting a drop in retail demand in the major
diamond jewellery markets and running down of inventories.
The major diamond producers, such as Debswana, De Beers and Alrosa, have made
very significant cutbacks in their supply of rough diamonds to the market, and
worldwide production in 2009 is expected to be approximately 35% lower than
2008. As a result of these actions rough diamond prices have increased more than
30% from their recent lows. The Company continues to believe that the long term
prospects for diamonds remain positive due to the projected significant long
term shortfall in supply, and that diamond prices will continue to increase as
the global economy recovers from recession.
James F Kenny
Chairman
12 November 2009
FIRESTONE DIAMONDS PLC
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30 JUNE 2009
+--------------------------------------------------+------------+------------+
| | 2009 | 2008 |
+--------------------------------------------------+------------+------------+
| | GBP000 | GBP000 |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
| Revenue | 4,034 | 3,309 |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
| Changes in inventories | - | (110) |
+--------------------------------------------------+------------+------------+
| Raw materials and consumables used | (170) | (603) |
+--------------------------------------------------+------------+------------+
| Employee costs | (801) | (1,198) |
+--------------------------------------------------+------------+------------+
| Amortisation and depreciation | (640) | (972) |
+--------------------------------------------------+------------+------------+
| Impairment of mineral rights and mining | (8,773) | (2,167) |
| properties | | |
+--------------------------------------------------+------------+------------+
| Impairment of goodwill | (2,473) | - |
+--------------------------------------------------+------------+------------+
| Other operating expenses | (1,728) | (1,328) |
+--------------------------------------------------+------------+------------+
| Gain on sale of investments | - | 3,030 |
+--------------------------------------------------+------------+------------+
| Loss on disposal of derivative financial | - | (65 |
| instruments | | |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| Operating loss | (10,551) | (104) |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
| Financial income | 117 | 134 |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
| Finance expense | (324) | (326) |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| Loss before tax | (10,758) | (296) |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
| Taxation | (233) | 59 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| Loss after tax for the year attributable to | (10,991) | (237) |
| equity shareholders | | |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
| Basic loss per share | (17.9)p | (0.4)p |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
| Diluted loss per share | (17.9)p | (0.4)p |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
FIRESTONE DIAMONDS PLC
CONSOLIDATED BALANCE SHEET
30 JUNE 2009
+--------------------------------------------------+------------+------------+
| | 2009 | 2008 |
+--------------------------------------------------+------------+------------+
| | GBP000 | GBP000 |
+--------------------------------------------------+------------+------------+
| Assets | | |
+--------------------------------------------------+------------+------------+
| Non-current assets | | |
+--------------------------------------------------+------------+------------+
| Goodwill | - | 2,058 |
+--------------------------------------------------+------------+------------+
| Intangible mining assets | 15,485 | 10,832 |
+--------------------------------------------------+------------+------------+
| Property, plant and equipment | 8,771 | 12,008 |
+--------------------------------------------------+------------+------------+
| Deferred tax asset | - | 247 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| | 24,256 | 25,145 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| Current assets | | |
+--------------------------------------------------+------------+------------+
| Inventories | 29 | 312 |
+--------------------------------------------------+------------+------------+
| Trade and other receivables | 586 | 1,345 |
+--------------------------------------------------+------------+------------+
| Cash and cash equivalents | 1,019 | 381 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
| | 1,634 | 2,038 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
| Total assets | 25,890 | 27,183 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| Equity and liabilities | | |
+--------------------------------------------------+------------+------------+
| Equity | | |
+--------------------------------------------------+------------+------------+
| Share capital | 12,346 | 11,170 |
+--------------------------------------------------+------------+------------+
| Share premium | 22,768 | 19,278 |
+--------------------------------------------------+------------+------------+
| Merger reserve | (1,076) | (1,076) |
+--------------------------------------------------+------------+------------+
| Translation reserve | (703) | (5,021) |
+--------------------------------------------------+------------+------------+
| Accumulated losses | (12,905) | (2,257) |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
| Total equity attributable to equity holders of | 20,430 | 22,094 |
| the parent | | |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| Non-current liabilities | | |
+--------------------------------------------------+------------+------------+
| Interest-bearing loans and borrowings | 1,864 | 1,861 |
+--------------------------------------------------+------------+------------+
| Deferred tax | - | 37 |
+--------------------------------------------------+------------+------------+
| Provisions | 188 | 200 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
| | 2,052 | 2,097 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| Current liabilities | | |
+--------------------------------------------------+------------+------------+
| Interest-bearing loans and borrowings | 1,137 | 775 |
+--------------------------------------------------+------------+------------+
| Trade and other payables | 1,361 | 1,642 |
+--------------------------------------------------+------------+------------+
| Current tax liabilities | - | 9 |
+--------------------------------------------------+------------+------------+
| Provisions | 910 | 566 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| | 3,408 | 2,992 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| Total equity and liabilities | 25,890 | 27,183 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
FIRESTONE DIAMONDS PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2009
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| |
+-------------------------------+
| | Share | Share | Merger | Fair-value | Translation | Accumulated | Total |
| | Capital | Premium | Reserve | reserve | reserve | losses | Equity |
| | GBP000 | | GBP000 | GBP000 | GBP000 | GBP000 | GBP000 |
| | | GBP000 | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| At 1 July 2007 | 11,158 | 19,182 | (1,076) | 2,947 | (2,134) | (2,584) | 27,493 |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Loss for the year | - | - | - | - | - | (237) | (237) |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| | - | - | - | - | - | (237) | (237) |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Deferred tax on net | - | - | - | - | - | 271 | 271 |
| investment in | | | | | | | |
| subsidiary | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Translation of | - | - | - | - | (2,887) | - | (2,887) |
| foreign | | | | | | | |
| subsidiaries | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Sale of | - | - | - | (2,947) | - | - | (2,947) |
| available-for-sale | | | | | | | |
| investments | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Total income and | - | - | - | (2,947) | (2,887) | 271 | (5,563 |
| expense recognised | | | | | | | |
| in equity in the | | | | | | | |
| year | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Total recognised | - | - | - | (2,947) | (2,887) | 34 | (5,800) |
| income and expense | | | | | | | |
| in the year | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Shares issued in | 12 | 96 | - | - | - | - | 108 |
| year | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Share-based payment | - | - | - | - | - | 293 | 293 |
| adjustment | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| At 30 June 2008 | 11,170 | 19,278 | (1,076) | - | (5,021) | (2,257) | 22,094 |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| At 1 July 2008 | 11,170 | 19,278 | (1,076) | - | (5,021) | (2,257) | 22,094 |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Loss for the year | - | - | - | - | - | (10,991) | (10,991) |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| | - | - | - | - | - | (10,991) | (10,991) |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Translation of | - | - | - | - | 4,318 | - | 4,318 |
| foreign | | | | | | | |
| subsidiaries | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Total income and | - | - | - | - | 4,318 | - | 4,318 |
| expense recognised | | | | | | | |
| in equity for the | | | | | | | |
| year | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Total recognised | - | - | - | - | 4,318 | (10,991) | (6,673) |
| income and expense | | | | | | | |
| in the year | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Shares issued in | 1,176 | 3,824 | - | - | - | - | 5,000 |
| year | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Share issue | - | (334) | - | - | - | - | (334) |
| expenses | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| Share-based payment | - | - | - | | - | 343 | 343 |
| adjustment | | | | | | | |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
| At 30 June 2009 | 12,346 | 22,768 | (1,076) | - | (703) | (12,905) | 20,430 |
+---------------------+---------+---------+---------+------------+-------------+-------------+----------+
FIRESTONE DIAMONDS PLC
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 30 JUNE 2009
+--------------------------------------------------+------------+------------+
| | 2009 | 2008 |
+--------------------------------------------------+------------+------------+
| | GBP000 | GBP000 |
+--------------------------------------------------+------------+------------+
| Cash flow from operating activities | | |
+--------------------------------------------------+------------+------------+
| Loss before taxation | (10,758) | (296) |
+--------------------------------------------------+------------+------------+
| Adjustments for | | |
+--------------------------------------------------+------------+------------+
| Depreciation, amortisation and impairment | 11,791 | 3,139 |
+--------------------------------------------------+------------+------------+
| Effect of foreign exchange movements | 894 | (284 |
+--------------------------------------------------+------------+------------+
| Interest payable | 323 | 326 |
+--------------------------------------------------+------------+------------+
| Equity-settled share-based payment | 343 | 293 |
+--------------------------------------------------+------------+------------+
| Loss on sale of derivative financial instruments | - | 64 |
+--------------------------------------------------+------------+------------+
| Profit on sale of investment in shares | - | (3,030) |
+--------------------------------------------------+------------+------------+
| Loss on sale of property, plant and equipment | - | 17 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| Net cash flow from operating activities before | 2,593 | 229 |
| changes in working capital | | |
+--------------------------------------------------+------------+------------+
| Decrease/(increase) in inventories | 26 | (36) |
+--------------------------------------------------+------------+------------+
| Decrease in trade and other receivables | 737 | 918 |
+--------------------------------------------------+------------+------------+
| (Decrease)/increase in trade and other payables | (322) | 360 |
+--------------------------------------------------+------------+------------+
| Increase/(decrease) in provisions | 180 | (280) |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
| Net cash flow generated from operating | 3,214 | 1,190 |
| activities | | |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| Investing activities | | |
+--------------------------------------------------+------------+------------+
| Payments for property, plant and equipment | (1,268) | (1,506) |
+--------------------------------------------------+------------+------------+
| Payments for non-current intangible assets | (5,635) | (4,084) |
+--------------------------------------------------+------------+------------+
| Costs capitalised within non-current intangible | - | (955) |
| assets | | |
+--------------------------------------------------+------------+------------+
| Payments to settle liability arising on | - | (726) |
| derivative financial instruments | | |
+--------------------------------------------------+------------+------------+
| Proceeds from sale of investment in shares | - | 5,621 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| | | |
+--------------------------------------------------+------------+------------+
| Net cash flow from investing activities | 3,214 | 1,190 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| Financing activities | | |
+--------------------------------------------------+------------+------------+
| Issue of ordinary shares | 5,000 | 108 |
+--------------------------------------------------+------------+------------+
| Share issue expenses | (334) | - |
+--------------------------------------------------+------------+------------+
| Proceeds from long-term borrowings | 900 | 238 |
+--------------------------------------------------+------------+------------+
| Proceeds from lease finance arrangements | - | 48 |
+--------------------------------------------------+------------+------------+
| Repayment of long-term borrowings | (905) | (336) |
+--------------------------------------------------+------------+------------+
| Repayment of lease finance | (11) | (9) |
+--------------------------------------------------+------------+------------+
| Interest paid | (323) | (326) |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| Net cash flow from/(used in) financing | 4,327 | (277) |
| activities | | |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| Net increase/(decrease) in cash and cash | 638 | (737) |
| equivalents in the year | | |
+--------------------------------------------------+------------+------------+
| Cash and cash equivalents at the beginning of | 381 | 1,119 |
| the year | | |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
| Cash and cash equivalents at the end of the year | 1,019 | 381 |
+--------------------------------------------------+------------+------------+
| | _________ | _________ |
+--------------------------------------------------+------------+------------+
Notes
1. Basis of preparation
Whilst the financial information included in this announcement has been prepared
in accordance with International Financial Reporting Standards (IFRS), this
announcement does not contain sufficient information to comply with IFRS. The
Company will publish full financial statements that comply with IFRS in November
2009.
The financial information set out in the announcement does not constitute the
Company's statutory accounts for the year ended 30 June 2009 or the year ended
30 June 2008. The financial information for the year ended 30 June 2009 and the
year ended 30 June 2008 are extracted from the statutory accounts of Firestone
Diamonds plc. The auditors, PKF (UK) LLP, reported on those accounts; their
report was unqualified and did not contain a statement under section 498(2) or
498(3) of the Companies Act 2006.
The 2009 accounts have been prepared on a basis consistent with the accounting
policies set out in the 2008 accounts.
2. Exceptional charges included within operating loss
During the year the Group recognised full impairment of the value of deferred
exploration and development expenditure and mining properties in respect of its
South African operations where exploration, development and mining operations
have been discontinued. This exercise has resulted in a full impairment charge
of GBP8,773,000 (2008: GBP2,167,000) being made for the year. The Group has also
recognised the full impairment of its goodwill, all of which arises from
investments in South Africa.
3. Loss per share
The calculation of the basic loss per share is based upon the net loss after tax
attributable to ordinary shareholders of GBP10,991,000 (2008 - loss of
GBP237,000) and a weighted average number of shares in issue for the year of
61,329,293 (2008 - 55,793,360).
Post year end the Group issued new equity totaling 35,873,480 ordinary shares of
GBP0.20 each. The loss per share when this is taken into consideration would be
GBP0.11.
The diluted loss per share in 2009 and 2008 is the same as the basic loss per
share as the losses have an anti-dilutive effect.
4. Annual General Meeting
The company's Annual General Meeting will be held at MWB Business Exchange, 60
Cannon Street, London EC4N 6NP on 15 December, 2009 at 12 noon.
5. Dividends
The directors do not recommend the payment of a dividend for the period.
6. Qualified person review
The information in this statement has been reviewed by Mr. Tim Wilkes, B Sc, Pr
Sci Nat, who is a qualified person for the purposes of the AIM Guidance Note for
Mining, Oil and Gas Companies. Mr. Wilkes is Chief Operating Officer of
Firestone Diamonds plc and has over 25 years experience in diamond exploration,
mineral resource management and mining. Mr. Wilkes is a member of the
sub-committee for diamonds of the South African Mineral Resource Committee
(SAMREC).
7. Announcement and Annual Report
This announcement was approved by the board on 12 November 2009.
The Annual Report for the year ended 30 June 2009, including the auditors'
report, will be posted to shareholders and will be available from the same date
to be downloaded from the Company's website at www.firestonediamonds.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR KGMMMLZVGLZM
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