Hidefield Gold plc
("Hidefield" or the "Company")
Interim Results for the 6 months ended 30 June 2006
I am delighted to report to you on the progress your company continued to make
during the period ended 30th June, 2006. Shareholders are reminded that as a
consequence of the change in the company's accounting reference date to 31
December these unaudited accounts are in respect of the period of six months to
30th June, 2006.
The past six months have seen your company undertake significant exploration
and drilling programmes in Argentina and Alaska following the conclusion of
transactions completed during the half year under review. Your Board believes
the assets acquired in these transactions will provide the company with
excellent exploration opportunities and potential near term mine development
possibilities in several of the world's premier mining regions.
The unaudited results of our activities and transactions completed during the
period ended 30th June, 2006 reflect a significant increase in our activities
in Argentina and Alaska and resulted in a loss on ordinary activities of �
711,551.
South America
Argentina is now the principal focus of the Company's direct exploration
activity. With the completion of the acquisition of the East Santa Cruz gold
projects from Yamana Gold Inc, the Company commenced its planned exploration
during March 2006 with field work and a substantial drill programme. This
exploration work was designed to increase gold resources and prepare for
pre-development activities on the East Santa Cruz projects. Assay results so
far received and for the most part now published in recent stock exchange
releases give us encouragement that it will be able to add substantially to the
previously estimated resources on these properties.
The assay results to date from the Company's initial drill programme confirm
that this has been an excellent acquisition for the Company and with the
commencement last week of a follow up drilling programme on these properties,
we are optimistic that by the end of this year we will have outlined sufficient
resources to enable us to commence a pre-feasibility study for the development
of our first gold mine.
In light of the excellent progress made in Argentina and the focus this will
bring to our near term activity in South America, we are evaluating how best to
manage and maximise the potential value of our Cata Preta and Sumidouro Dome
projects in Brazil. The acquisition of strategic licenses in and around our
original license holdings has opened up a number of possible alternatives for
taking these projects forward, including the establishment of joint ventures
with one or more third parties.
North America
Following the May 2006 conclusion of the transaction with Piper Capital which
provided the Company with the right to earn up to a 100% interest in the Golden
Zone and South Estelle projects in Alaska, the Company undertook a significant
exploration programme at both the projects. While drilling conditions on the
Golden Zone breccia deposit were challenging and assay results from our
exploration programmes outside of the breccia deposit have not yet been
received, the Company has been encouraged by field reports of the discovery of
several promising indications of mineralisation on these properties. The
results of this work will be announced once our evaluation and planning for
follow up work is complete.
Associate Companies
Most of the activity by Alto Ventures (now 31 per cent. owned) during the past
year has been focused on the Despinassy gold project in the Abitibi greenstone
belt, near Val d'Or, Quebec and the Coldstream project in northern Ontario,
Canada. Drill programmes during the first half of the year on the Despinassy
and Coldstream confirmed the continuity of mineralization on both properties
and indicates the excellent potential to significantly expand the
mineralization already identified.
In May, 2006, Hidefield's other significant associate company investment,
Columbus Gold (now 22 per cent. owned) successfully completed its IPO on the
TSX Venture Exchange in Canada following an offering of new shares which raised
approximately Can$5 million. This funding provides Columbus Gold with the
resources to undertake exploration and expansion of the promising gold and
silver projects in its portfolio. Drill results from Columbus's first drilling
programme on its Golden Mile property, completed during the half year under
review, were very encouraging and are now being followed up with another
substantial drilling programme to be completed in the next few months.
Columbus has also recently announced the conclusion of three important joint
ventures on gold projects it holds in Nevada, including on and around the Utah
Clipper project, where the US subsidiary of Agnico Eagle Mines Limited has
agreed to spend up to US$6.5 million in exploration expenditures to earn a 51
per cent interest in the Utah Clipper, Crestview and Laura properties that will
form the basis of an important new joint venture. These properties are located
directly on the prolific northwest Battle Mountain Trend, host to a number of
world-class gold deposits in the Cortez-Pipeline area and immediately adjacent
to the Pipeline-Gold Acres mine complex.
Conclusion
The Board is very encouraged by the considerable progress we have made in
building shareholder value through our recent exploration activities. This has
involved a significant effort by my colleagues on the Board, our talented
associates in North and South America and the continued support of our
shareholders who have provided us with the resources to invest in our
ambitions. This support included the approximately �4 million in new equity
which we raised from existing and new shareholders with the assistance of our
brokers Teather & Greenwood: Landsbanki and we have gone on to supplement our
financial resources with the timely sale of our investment in Forum Uranium
which resulted in the receipt of Can$ 417,900 representing a profit of over �
125,000 on our modest initial investment.
On behalf of the Board I wish to thank all of our people and our shareholders
for their continued efforts and support and look forward with optimism to
continued good results to come from all of our activities during the remainder
of 2006.
Kenneth P Judge
Chariman
25 September 2006
Consolidated Profit and Loss Account (Unaudited) for the six months ended 30
June 2006
6 months to 12 months to 6 months to
30 June 30 September 31 March
2006 2005 2005
� � �
Administrative expenses - continuing activities (587,088) (1,042,433) (602,714)
Other operating income - 2,346 2,198
Operating loss (587,088) (1,040,087) (600,516)
Share of operating loss in Associates (146,071) (204,127) (74,863)
Profit on sale of mining properties - 475,662 410,324
Other interest receivable and similar income 21,608 29,466 18,105
Loss on ordinary activities before taxation (711,551) (739,086) (246,950)
Taxation - (224,089) (209,644)
Retained loss for the year (711,551) (963,175) (456,594)
Loss per share (0.4p) (0.6p) (0.3p)
Diluted loss per share (0.4p) (0.6p) (0.3p)
Consolidated Statement of Total Recognised Gains and Losses (Unaudited) for the
six months ended 30 June 2006
6 months to 12 months to 6 months to
30 June 30 September 31 March
2006 2005 2005
� � �
Loss for the financial year (711,551) (963,175) (456,594)
Currency translation differences on foreign currency
net investments (136,239) 46,549 (17,654)
Total recognised gains and losses relating to the year (847,790) (916,626) (474,248)
Consolidated Balance Sheet (Unaudited) at 30 June 2006
30 June 30 September 31 March
2006 2005 2005
� � � � � �
Fixed Assets
Tangible assets 94,272 - -
Intangible assets - negative goodwill (82,232)
Intangible assets - mineral rights 5,355,453 418,350
Share of net assets of associates 2,292,321 801,701 -
Investments 141,393 2,351,006 2,754,201
7,883,439 3,152,707 3,090,319
Current Assets
Debtors 484,858 8,072 71,479
Cash at bank 2,254,169 1,427,937 1,908,262
2,739,027 1,436,009 1,979,741
Creditors - amounts
falling due within
one year (221,193) (276,102) (320,518)
Net Current Assets 2,517,834 1,159,907 1,659,223
Net Assets 10,401,273 4,312,614 4,749,542
Capital and Reserves
Called up share capital 2,322,121 1,524,488 1,523,588
Share premium account 12,996,663 7,175,147 7,170,597
Shares to be issued 150,000 - -
Profit and loss account (5,067,511) (4,387,021) (3,944,643)
Shareholders' Funds 10,401,273 4,312,614 4,749,542
Consolidated Cash Flow Statement (Unaudited) for the six months ended 30 June
2006
6 months to 12 months to 6 months to
30 June 30 September 31 March
2006 2005 2005
� � �
Net Cash Outflow from Operating Activities (Note 1) (1,170,172) (943,583) (446,221)
Returns on investments and servicing of finance
Bank interest received 21,608 29,466 18,105
Taxation
Taxation paid - (224,089) (209,644)
Capital Expenditure and Financial Investment
Payments to acquire investments (407,386) (561,527) (581,113)
Payments to acquire mineral rights (1,020,225) (80,185) -
Payments to acquire tangible fixed assets - - -
Sale of mining rights - 491,044 410,324
Sale of investments - -
(2,576,175) (1,288,874) (808,549)
Financing
Capital raising costs (201,352) - -
Issue of ordinary share capital for cash 4,051,251 5,000 5,000
(Decrease)/Increase in Cash (Note 2) 1,273,724 (1,283,874) (803,549)
Notes to the Cash Flow Statement
6 months to 12 months to 6 months to
30 June 30 September 31 March
2006 2005 2005
� � �
1 Reconciliation of Operating Loss to Net
Cash Outflow from Operating Activities
Operating loss (587,088) (1,040,087) (600,516)
Increase/(decrease) in creditors 87,265 198,764 243,180
(Increase)/decrease in debtors (479,070) 41,803 (21,604)
Depreciation and amortisation 1,169 (149,513) (67,281)
Exchange differences (195,261) - -
Directors remuneration paid by issue of shares 2,813 5,450 -
Net Cash Outflow from Operating Activities (1,170,172) (943,583) (446,221)
2 Reconciliation of Net Cash Flow
to Movement in Net Funds
Increase/(decrease) in cash during the period 1,273,724 (1,283,874) (803,549)
Movement in net funds in the period 1,273,724 (1,283,874) (803,549)
Net funds at start of period 980,445 2,711,811 1,273,498
Net funds at end of the period 2,254,169 1,427,937 469,949
3 Major Non Cash Transactions
a) Shares issued in part payment of consideration for
the purchase of Recursos Yamana SA - 8 million
ordinary shares at 7.5p. �600,000
b) Shares issued in part payment of consideration for
the purchase of the interest of Piper Capital in the
Golden Zone and South Estelle mineral projects in
Alaska - 24,071,542 ordinary shares at 9.375p. �2,256,707
Notes:
1. This Interim Statement for the 6 months ended 30 June 2006 is unaudited and was
approved by the directors on 25 September 2006. The foregoing financial
information does not constitute statutory accounts within the meaning of
section 240 of the Companies Act 1985. Statutory accounts relating to the 15
months ended 31 December 2005 have been filed with the Registrar of Companies.
The auditors' report on those financial statements was unqualified.
2. No dividends were paid or proposed in respect of the six months ended 30 June
2006.
END
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