Interim Results
September 29 2005 - 4:00AM
UK Regulatory
Central China Goldfields plc
`GGG' or `The Company'
INTERIM RESULTS FOR THE PERIOD ENDING 30 JUNE 2005
Business Highlights:
* Admission to AIM 30th March 2005
* 950,500 ounces of gold in the Inferred Resource category in 3 properties in
Sichuan Region
* Field work on prospective Carlin-like area progressing
Subsequent Events:
* New Joint Venture signed on 4th July 2005 on a 200,000 ounces of gold and
4,000,000 ounces of silver project at equivalent 9.3g/t Au.
Chairman Nigel Clark commented:
"It has been a most significant period for Central China Goldfields since
listing on AIM and we continue to create a substantial platform for future
growth and work on the development of further opportunities."
For Further information please contact:
Central China Goldfields plc Nominated Advisor:
Dr. Jeffrey Malaihollo Ruegg & Co Limited
Tel: 020 7621-0200 Brett Miller
Email: jeff@ccgoldfields.com Tel: 020 7584-3663
www.ccgoldfields.com
Public Relations: Broker:
Parkgreen Communications King & Shaxson Capital Limited
Victoria Thomas / Justine Howarth Nick Bealer
Tel: 020 7493-3713 Tel: 020 7426-5986
Chairman's statement:
It is my pleasure to write the first Chairman's statement to accompany the
interim results for the period covering 1 January 2005 - 30 June 2005.
This has proved to be a most significant period for the Company, creating a
substantial platform for future growth and working on the development of
further opportunities.
HIGHLIGHTS:
* In March 2005 the Company raised � 2 million and listed its Ordinary Shares
and Warrants on AIM
* A total of 950,500 ounces of gold in the Inferred Resource category
(already defined to various Chinese reporting standards) in 3 properties in
Sichuan
* Field work on a prospective Carlin-like area in northern Sichuan is
progressing and results will be reported to the market as they become
available
* Extension of adits (tunnels) to expand known resources in the Shuiniujia
and Songpanguo deposits are in progress
* Drilling of the Qiaoqiaoshang deposit is planned for Q4 2005
* New targets have been identified using satellite imagery and stream
sediment Bulk Leach Extractable Gold ("BLEG") sampling
SUBSEQUENT EVENT:
* On 4 July 2005, the Company signed a new Joint Venture on a 200,000 ounces
of gold and 4 million ounces of silver project (defined to Chinese
standards) at the equivalent grade of 9.3 g/t Au
VISION AND STRATEGY:
China is the fourth largest gold producer in the world with an estimated
production of 212 tonnes or 6.8 million ounces in 2004, yet only 1% of global
exploration dollars are spent in China. The reason for this is because the
mining industry in China is fragmented, under-explored, under-developed and
enterprises are in need of financial and technical assistance.
The Directors believe this is a window of opportunity where we can use our
technical and corporate expertise successfully to discover, develop and acquire
mines in China. Our vision is to build the Company to become one of the premier
mining and exploration companies operating in China.
Although we are a young company, we have assembled a very strong management
team and a Board of Directors with many years of technical and corporate
experience specifically in China. Chris Ford our Exploration Manager was the
Exploration Manager at BHP for the whole of Asia from 1992 to1998, during which
time China was a key focus area. I set up the China exploration and development
activities for Billiton (now BHP Billiton) in 1997 and have remained in China
ever since. My current work as Managing Director of the British Chamber of
Commerce in China and my Chairmanship of the China International Mining Group
provide complementary networks and knowledge to GGG's activities. Our Managing
Director, Jeff Malaihollo, worked with me in China in 1997-1998 and Patrick
Harford worked with Tianshan Goldfields Limited in 2003.
In March 2005, the Company successfully raised �2 million in a private
placement which was well oversubscribed, and on 30 March 2005 the Company's
Ordinary Shares and Warrants (piggy back warrant, the first series exercisable
at 8p until 30 April 2006, the second series exercisable at 10p until 30 April
2007) were admitted for trading on AIM. The money raised enables us to explore
and pursue corporate opportunities in China.
Below is a summary of the progress of your company so far and we are looking
forward to reporting further successes from both our exploration programmes and
from our corporate development.
EXPLORATION PROGRESS:
Central China Goldfields plc is exploring in, what the Directors believe, one
of the most prospective and yet under-explored regions in China.
The Company started its field exploration programme on 25 April 2005. Field
work is supervised by Chris Ford, our Exploration Manager, who is based in
Chengdu, Sichuan Province. We have received some results (news releases on 7
July, 12 July, 4 August and 26 September 2005) and will continue to report
results as and when they become available.
Our exploration strategy in Sichuan is two fold:
1. To up-grade the approximately 1 million ounces of gold that our partner the
Sichuan Bureau of Metallurgy and Geological Exploration ("SBMGE") have
defined into an internationally acceptable standard and to assess its
economic potential
2. To identify exploration targets within the 4,600 km2 area where the Company
has a first right of refusal to apply for additional exploration licence.
At Qiaoqiaoshang ("QQS"), our partner has defined approximately 630,000 ounces
of gold at 1.0 - 3.0 g/t Au, of which 147,400 ounces of gold @ 2.21 g/t Au is
compliant to Canadian stock market reporting standard (NI 43-101). At QQS
trenches and adits have been cleaned and re-sampled. A high-precision
dipole-dipole Induced Polarisation survey conducted suggests that the nine ore
bodies, defined by our partner, are controlled by the same structure and the
zone of mineralisation may continue for another 400 metres westward. We are
currently in the process of appointing a drilling contractor and expect
drilling to commence in October 2005.
At Songpanguo ("SPG"), an initial inferred resource of 204,000 ounces of gold
at 3.1 - 5.0 g/t Au has been calculated to Chinese 333 and 334 standards, of
which 59,500 ounces of gold @ 5.23 g/t Au is compliant to the Canadian 43-101
standard. Work here started with the cleaning up of existing trenches and adits
to verify previous results. Extensions of several adits have been identified
and are being dug to target new mineralisation zones. Additional soil sampling
has been completed on areas previously unexplored. We will announce results
from this area within the next few weeks. We also recently took some large 20kg
samples for initial metallurgical tests.
At Shiuniujia ("SNJ") an initial inferred resource of 143,000 ounce of gold at
4.1 - 5.6 g/t Au has been identified to Chinese 333 and 334 standards (of which
18,500 ounces of gold @ 4.89 g/t Au is compliant to Canadian 43-101 standard).
Work here started with the cleaning up of trenches and adits and results from
this work will be reported shortly. Extension and development of new adits are
currently in progress.
At Xiangshujia ("XSJ"), two zones of anomalous gold (measuring 200 m x 300m and
200 x 800 m) and one zone of anomalous arsenic-antimony, typical of
Carlin-style mineralization, have been identified. New trenches, over these
gold and arsenic-antimony zones, have been dug and results will be available
shortly.
The SPG and SNJ deposits are within 6km of each other and the XSJ licence area
adjoins the SPG licence. We will assess the economics of mining these deposits
in a combined operation.
At Gaojiamo and Shangpengzi work has consisted of cleaning up of old trenches,
digging of new trenches over previously discovered gold anomalies in soil and
extending the soil sample surveys.
Regionally, an orientation BLEG survey on stream sediment samples in the
Shuniujia area along with Landsat combined with Advanced Spaceborne Thermal
Emission and Reflection Radiometer ("ASTER") satellite images proved to be
effective methods of exploration. We are currently extending these surveys over
the 4600km2 area under option.
CORPORATE PROGRESS:
Corporately, our Joint Venture in Sichuan received its Business Licence on 2
December 2004. This means that the Sino-Foreign Joint Venture is now approved
and recognised by the Central, Provincial and County Governments. This is a
critical and important step in China. As a result of this, the Joint Venture
company is now able to hold all of our Exploration Licences directly.
A little over 3 months post listing, we signed a new Joint Venture with the
Hubei North East Geological Team ("HNEGT") on a high-grade gold-silver-base
metal deposit in the Luotian County in NE Hubei Province. The Xiangshuitan
deposit has an inferred resource of 200,000 ounces of gold, 4 million ounces of
silver and some copper-lead-zinc credits defined to various Chinese standards.
Central China Goldfields plc, through its wholly owned subsidiary Central China
Minerals Ltd., can earn 70% of the project by spending RMB 8.58 (approximately
US$ 1 million) over 3 years. Upon earning the 70%, should our partner choose
not to contribute further, we can increase our interest to 85%. On dilution to
15% HNEGT would be free-carried to production. Prior to the distribution of
profit, the total costs of investment would be returned to each participant.
This is a project that we can advance rapidly.
I am also pleased to report that our Managing Director, Dr. Jeffrey Malaihollo,
is now employed full-time by Central China Goldfields plc. He remains a
Director of Loeb Aron & Co Ltd, a Corporate Finance firm in London specialising
in natural resources. Dr. Malaihollo has the full backing of his colleagues at
mining finance specialist Loeb Aron & Co Ltd who are significant shareholders
in Central China Goldfields and who recognise the time requirements of developing
a successful exploration company.
THE FUTURE:
These are exciting times for us, with exploration results to be announced on a
regular basis over the next few months. We will continue to pursue other
corporate opportunities in line with our strategy and we are confident that we
will achieve our vision of becoming one of the premier mining and exploration
companies in China.
I would like to take this opportunity to thank all the board and staff members,
both in China and London for their dedication and contribution to date.
Nigel Clark
Chairman
Beijing 28 September 2005
Financial Information
(unaudited)
Group Profit and Loss
6 Months
ended
30 June 2005
�
General and administration expenses 337,458
OPERATING LOSS - All Continuing activities 337,458
Interest income 26,803
(LOSS) BEFORE TAXATION (310,655)
Taxation -
(LOSS) AFTER TAXATION (310,655)
(LOSS) Per Share (0.008)
Group Recognised Gains and Losses
6 Months
ended
30 June 2005
�
Loss for the period (310,655)
Exchange loss on foreign currency net investments 0
Total recognised losses for the period (310,655)
Group Balance Sheet
As at As at
30 June 2005 31 Dec 2004
� �
FIXED ASSETS
Tangible assets 1,107 1,107
Intangible assets 383,004 142,547
384,111 143,654
CURRENT ASSETS
Debtors 390 49,800
Cash at Bank 1,872,498 500,312
1,872,888 550,112
CREDITORS
Amounts falling due within one year 6,082 13,943
NET CURRENT ASSETS/(LIABILITIES) 1,866,806 536,169
NET ASSETS 2,250,917 679,823
CAPITAL AND RESERVES
Called-up share capital 522,450 145,400
Share premium account 2,062,667 430,918
Profit and loss account - (deficit) (334,200) (23,545)
Other reserves - 127,050
SHAREHOLDERS FUNDS 2,250,917 679,823
Group Cash Flow Statement
6 Month
ended
30 June 2005
�
Net Cash inflow/(outflow)from operating activities (269,017)
Capital expenditure and financial investment
Payment in respect of intangible assets (240,547)
Net Cash Outflow from capital investment and financial
investment (240,547)
Net Cash Outflow before use of liquid resources and
financing (509,564)
Financing
Share capital issued for cash 1,881,750
Net Cash Flow from financing 1,881,750
Increase(Decrease) in cash 1,372,186
CENTRAL CHNA GOLDFIELDS plc
NOTES TO THE INTERIM FINANCIAL STATEMENTS
FOR THE SIX MONTH PERIOD ENDED 30 JUNE 2005
1. The interim results, which are unaudited, have been prepared in accordance
with International Financial Reporting Standards (IFRS) adopted by the
International Accounting Standards Board (IASB).
The unaudited interim financial statements for the six months ended 30 June
2005 do not constitute statutory accounts within the meaning of section 240 of
the Companies Act 1985 and have been drawn up using accounting policies and
presentation consistent with those applied in the audited accounts for the year
ended 31 December 2004.
The financial information for the year ended 31 December 2004 has been
extracted from the statutory accounts for that period. The auditors report on
those accounts was unqualified.
2. No dividends were proposed or paid during the period.
3. The calculation of basic loss per share is based on a loss for the interim
period of � 310,655 and on a weighted average of approximately 39,463,000
ordinary shares of 1p each in issue during the period.
4. Due to losses incurred no taxation has been provided for. Deferred tax
assets on losses have not been recognised as it is not foreseeable with
sufficient certainty that the related tax benefit will be realised.
5. The Company was incorporated on November 3, 2004 and thus there are no
comparative profit and loss figures for 2004.
END
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