TIDMORM
RNS Number : 7329E
Ormonde Mining PLC
06 June 2012
6 June 2012
Ormonde Mining plc
("Ormonde" or "the Company")
Final Results for the year ended 31 December 2011
DUBLIN & LONDON: 6 June 2012 - Ormonde Mining plc announces
its final results for the year ended 31 December 2011.
HIGHLIGHTS
-- Barruecopardo Tungsten Project's Definitive Feasibility Study
reported in February 2012, confirming the project's technical
feasibility and exceptional economics
-- Discussions advanced with several interested parties in
relation to off-take arrangements and funding Barruecopardo;
successful conclusion to these anticipated over the coming
months
-- Early July submission for the final permitting documentation;
plant commissioning now scheduled for Q4 2013
-- Tungsten prices remained strong during the year, following
significant price increases resulting from global supply
constraints
-- Geophysical surveys on new La Zarza permit areas identified
several targets, which are being tested by the current drilling
programme
-- Documentation to support the transfer of the La Zarza mining
rights to Ormonde submitted in December 2011 and application under
review by the Provincial administration
-- Very encouraging results from initial drilling on our Joint
Venture Gold projects, leading to an expanded drilling
programme
Mike Donoghue, Chairman, commented:
"A significant milestone was reached over the last year, with
the completion of the Definitive Feasibility Study on our
Barruecopardo Tungsten Project. This study demonstrated the
technical feasibility and exceptional economics of this world class
tungsten asset. Its completion has enabled us to advance earlier
discussions with interested parties in relation to funding the
project to a stage whereby we anticipate finalisation of funding
arrangements over the coming months."
Enquiries to:
Ormonde Mining plc
Kerr Anderson, Managing Director Tel: +353 (0)1 8253570
Bankside Consultants
Simon Rothschild Tel: +44 (0)20 7367 8888 Mob: +44 (0)7703 167065
Murray Consultants
Ed Micheau Tel: +353 (0)1 4980300 Mob: +353 (0)86 803 7155
Davy (Nomad / ESM Adviser)
Eugenee Mulhern / Roland French Tel: +353 (0)1 6796363
Fairfax I.S. PLC (Joint Broker)
Ewan Leggat / Katy Birkin Tel: +44 (0)207 598 5368
CHAIRMAN'S REVIEW
The objectives that your Company set itself at the end of 2010
were: to complete the feasibility study evaluation for our
Barruecopardo Tungsten Project and advance its permitting and
funding to ensure development; to secure new exploration ground and
recommence exploration on La Zarza through the Antofagasta Joint
Venture; and to advance the evaluation of our gold licences in the
Salamanca and Zamora Provinces. I am pleased to report that we have
made good progress on all of these objectives, and in particular on
our flagship Barruecopardo Project.
The feasibility study on the Barruecopardo Project in the
Salamanca Province was carried out during the year and the results
reported in late February 2012. The outcome was very positive,
demonstrating a technically viable, initially open pit mining
operation which would benefit from low capital costs and low
operating costs. This will result in a project with exceptional
economics at prudent tungsten prices, well below both recent and
future prices forecast by international metals market research
companies. With this milestone achieved, Ormonde is in a position
to advance the remaining objectives during 2012, including capital
funding and off-take arrangements, permitting and mine
development.
The feasibility study has facilitated due diligence on the
project. This in turn has enabled earlier discussions with several
third parties in relation to capital funding and off-take
arrangements to be advanced, whereby the Directors are confident of
finalising these arrangements over the coming months.
The final stage of pre-development, the detailed engineering
design work, will be initiated as soon as the current metallurgical
testwork is completed. This testwork serves two objectives, firstly
to provide larger testwork runs to meet the needs of the process
plant manufacturers so that they can supply equipment performance
guarantees, and secondly to supply sufficient samples to facilitate
agreement with concentrate off-takers. Completion of this work will
allow for the commencement of the detailed engineering stage ahead
of mine development.
The first stage of permitting, the Documento Inicial, was
completed successfully during 2011 and the final permitting
documentation, incorporating all responses and guidance provided by
the relevant regulatory bodies to the Documento Inicial, is now
being readied for submission in early July. While this planned
submission is somewhat behind the schedule previously envisaged,
its timing reflects the detailed work in incorporating the proposed
mining operation as defined in the feasibility study (along with a
comprehensive Environmental Impact Assessment), currently being
updated to reflect recent modifications to Spanish legislation
applicable to mining operations. It is this final submission which
will be reviewed by all relevant regulatory departments prior to a
decision on the granting of a mining concession on Barruecopardo,
and therefore ensuring that it fully addresses and anticipates all
requirements is essential to facilitate the granting of the mining
licence. As a consequence, the project development schedule has now
been extended such that plant commissioning has moved from Q3 to Q4
2013.
The external environment for tungsten remains healthy.
Uncertainty in the global economy has resulted in a slight easing
of APT prices from the US$440-450 per mtu "plateau" during 2011 to
an average price of some US$410 during the last few months. Medium
to long term price forecasts remain firm.
Two fundamental structural problems appear to have developed in
the tungsten industry; firstly the supply-demand imbalance
resulting in significant supply shortages, and secondly the
reliance on Chinese supplies of intermediate powders such as APT is
being brought into sharp focus by the fact that Chinese exports of
APT are predicted to reduce and possibly be phased out over the
coming years (as previously happened with the supply of Chinese
tungsten concentrates). The withdrawal of Chinese primary
concentrates from the market place affected the secondary powder
processors and encouraged them to become more involved upstream
with primary mine producers. However, the reduction in Chinese APT
supply will directly affect the much larger downstream tungsten
tool and steel manufacturers and one is starting to see these
manufacturers moving upstream to become involved with primary
producers.
These supply issues have been highlighted by the EU in its
report "Critical Raw Materials for the EU" (May 2010) where
tungsten was listed as a "critical raw material" due to its "high
economic importance and high relative supply risk" and more
recently by the British Geological Survey who have ranked tungsten
in the joint highest position in its "Current Supply Risk Index" of
metals which are of economic value.
At our La Zarza Copper Project, documentation to support the
transfer of the mining rights from the underlying holder Nueva
Tharsis to our Spanish subsidiary Ormonde Espana SL was compiled
and submitted in December 2011. Ormonde is presently liaising with
the Mines Department in Huelva as this application is
progressed.
Four new investigation permits, which cover substantial areas
along strike of the La Zarza system, were issued during 2011 and
incorporated into the Antofagasta joint venture activities. An
airborne geophysical (electro-magnetic) survey and a ground gravity
survey were completed over the permit areas and a significant
number of targets identified. Early in 2012 a drilling programme
was initiated over these targets and this programme is expected to
conclude in the summer of 2012.
In March 2011, the Company entered into a joint venture with
Aurum Mining Plc ("Aurum") to further explore four permit areas
held by Ormonde in the Salamanca and Zamora Provinces. Aurum is
spending EUR500k to earn a majority position in these permits. An
initial three-hole drilling programme carried out by the Joint
Venture during 2011 encountered very encouraging results on the El
Facho gold structure in Zamora. This led on to a larger nine-hole
programme to test the extent of the El Facho structure, which was
completed in March 2012. Results from the first holes of this
programme support the initial drilling and we await the remaining
results.
The Company expended a total of EUR4,320,818 on its activities
during 2011, as detailed in the Accounts. The Company has reported
a loss of EUR966,369 for the year which has narrowed from a loss of
EUR1,088,451 in 2010. The Company is well-funded for its current
activities ahead of capital funding for Barruecopardo having
successfully raised GBP3.39 million in a placing announced in March
2012.
I would like to thank our shareholders, staff and advisers for
their continued support during 2011.
Michael J. Donoghue
Chairman
6 June 2012
Consolidated Statement of Comprehensive Income
Year ended 31 December 2011
2011 2010
EUR000's EUR000's
Administrative expenses (982) (1,061)
Exploration costs written off - (32)
----------- -----------
OPERATING LOSS (982) (1,093)
Interest receivable and similar income 15 6
----------- -----------
LOSS FOR THE YEAR BEFORE TAXATION (967) (1,087)
Taxation 1 (1)
----------- -----------
LOSS FOR THE YEAR (966) (1,088)
Minority Interest - -
----------- -----------
RETAINED LOSS FOR THE YEAR (966) (1,088)
=========== ===========
EARNINGS PER SHARE
Basic loss per ordinary share (EUR0.0030) (EUR0.0043)
=========== ===========
Diluted loss per ordinary share (EUR0.0029) (EUR0.0043)
=========== ===========
Consolidated Statement of Financial Position
As at 31 December 2011
31/12/11 31/12/10
EUR000's EUR000's
ASSETS
NON-CURRENT ASSETS
Intangible assets 16,764 12,443
Tangible assets 4 21
-------- --------
16,768 12,464
CURRENT ASSETS
Trade and other receivables 427 150
Cash and cash equivalents 1,990 1,944
-------- --------
2,417 2,094
TOTAL ASSETS 19,185 14,558
======== ========
EQUITY AND LIABILITIES
EQUITY
Called-up share capital 10,151 9,042
Share premium account 24,174 20,889
Capital conversion reserve fund 29 29
Capital redemption reserve fund 7 7
Share based payment reserve 778 664
Foreign currency translation reserve 1 1
Profit and loss account (17,313) (16,347)
-------- --------
Attributable to equity holders 17,827 14,285
Minority interest - -
17,827 14,285
NON-CURRENT LIABILITIES
Trade and Other Payables 21 -
- -
-------- --------
CURRENT LIABILITIES
Trade and Other Payables 1,337 273
-------- --------
1,358 273
-------- --------
Total Liabilities 1,358 273
-------- --------
TOTAL EQUITY AND LIABILITIES 19,185 14,558
======== ========
Consolidated Statement of Cash Flows
Year ended 31 December 2011
2011 2010
EUR000's EUR000's
CASH FLOWS FROM OPERATING ACTIVITIES
Loss for the year before taxation (967) (1,087)
Adjustments for:
Foreign exchange (loss)/gain - -
Depreciation 3 6
Exploration costs written off 0 32
Movement on share-based payment reserve 114 432
Investment revenue recognized in profit or
loss (14) (6)
--------- ---------
(864) (623)
MOVEMENT IN WORKING CAPITAL
(Increase) in debtors (277) (41)
Increase /(Decrease)in creditors 1,084 (501)
Income taxes paid 1 (1)
--------- ---------
NET CASH (USED IN) OPERATING ACTIVITIES (56) (1,166)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds of issue of share capital 4,394 3,468
CASH FLOWS FROM INVESTING ACTIVITIES
Expenditure on exploration activities (4,321) (842)
Movement in property, plant and equipment 15 (19)
Interest received 14 5
NET CASH (USED IN) INVESTING ACTIVITIES (4,292) (856)
NET INCREASE /(DECREASE) IN CASH AND CASH EQUIVALENTS 46 1,446
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR 1,944 498
--------- ---------
CASH AND CASH EQUIVALENTS AT END OF YEAR 1,990 1,944
========= =========
Consolidated Statement of Changes in Equity
Year ended 31 December 2011
Share
Based
Share Share Payment Other Retained
Capital Premium Reserve Reserves Losses Total
EUR000's EUR000's EUR000's EUR000's EUR000's EUR000's
Balance at 1 January 2010 7,447 19,016 232 37 (15,258) 11,474
Loss for the year - - - - (1,089) (1,089)
Recognition of share based
payments - - 432 - - 432
Proceeds of share issue 1,595 1,873 - - - 3,468
-------- -------- -------- -------- -------- --------
Balance at 31 December 2010 9,042 20,889 664 37 (16,347) 14,285
-------- -------- -------- -------- -------- --------
Balance at 1 January 2011 9,042 20,889 664 37 (16,347) 14,285
Loss for the year - - - - (966) (966)
Recognition of share based
payments - - 114 - - 114
Proceeds of share issue 1,109 3,285 - - - 4,394
-------- -------- -------- -------- -------- --------
Balance at 31 December 2011 10,151 24,174 778 37 (17,313) 17,827
======== ======== ======== ======== ======== ========
1. The basic loss per share and the diluted loss per share have
been calculated on a loss after taxation of EUR966,369 (2010: loss
of EUR1,088,451) and a weighted average number of Ordinary Shares
in issue for the year of 324,000,975 (2010: 250,388,186) for the
basic loss per share and 325,921,230 (2010: 253,686,797) for the
diluted loss per share.
This information is provided by RNS
The company news service from the London Stock Exchange
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