TIDMLRL
RNS Number : 9042H
Leyshon Resources Limited
02 March 2010
2 March 2010
LEYSHON RESOURCES LIMITED
Interim results for the half year ended 31 December 2009
$28 Million Profit on Zheng Guang Project Sale
Leyshon Resources Limited (AIM/ASX:LRL) is pleased to report a net operating
profit after tax for the half-year ended 31 December 2009 of $27.20 million
(2008: Net operating loss after tax of $2.95 million).
During the half year, the sale of the Company's 70% interest in the Zheng Guang
project was completed and a profit of $28.4 million recognised. There were no
advisory fees paid and legal and accountancy fees totalled $44,500.
As a result, the Company now has approximately $48 million held in cash and on
term deposit in Australia. At current exchange rates this equates to
approximately $0.22 per share.
Whilst the Company remains alive to a wide range of opportunities that meet the
investment guidelines both within China and elsewhere, the current focus is on a
broad region encompassing Northern China and Southern Mongolia.
The Company is specifically targeting and in some cases, undertaking detailed
due diligence on,Coking Coal and Iron Ore projects.
Results from the first phase drill programme and testwork at the 51% owned QHD
Iron Mountain project in the Tang Shan district of Hebei East China are
currently being analysed. A review of the project is expected to be completed by
the end of April.
Managing Director Paul Atherley commented: "The successful sale of Zheng Guang
has put the Company in a very good position to identify investment opportunities
located in a part of the world that is benefitting from very strong investment
growth."
For further information contact:
Leyshon Resources Limited
Paul Atherley - Managing Director
Tel: +61 417 475 038 or China +86 137 1800 1914
patherley@leyshonresources.com
Seymour Pierce
Jonathan Wright
Tel: +44 (0)207 107 8000
The Board of Directors of Leyshon Resources Limited present their report on the
consolidated entity of Leyshon Resources Limited ("the Company" or "Leyshon
Resources") and its subsidiaries during the half-year ended 31 December 2009
("Consolidated Entity").
The names of the Directors of Leyshon Resources in office during the half-year
and until the date of this report are:
John Fletcher
Paul C Atherley
Richard Seville
Andrew Berry
REVIEW AND RESULTS OF OPERATIONS
Operating Results
Net operating profit after tax attributable to members of the Consolidated
Entity for the half-year ended 31 December 2009 was $27,202,335 (2008: Net
operating loss after tax of $2,950,192).
Operations
Leyshon Resources Limited (AIM/ASX: LRL) (Company) is pleased to report that
during the half year it completed the sale of its interest in the Zheng Guang
project. There were no advisory fees paid and legal and accountancy fees
totalled $44,500.
As a result the Company now has approximately $48 million held in cash and on
term deposit in Australia and RMB1.98 million in Beijing. At current exchange
rates this equates to approximately $0.22 per share.
Subsequent to the half year end, the Company announced its intention to commence
an on market share buy-back of up to 21,800,000 fully paid ordinary shares. This
equates to approximately 10% of the fully paid issued capital. Seymour Pierce in
London and Blackswan Equities in Australia are handling the buy-back on the
Company's behalf.
At the Annual General Meeting held in November, the Company received
overwhelming support for the divestment of Zheng Guang and the proposed
Investing Policy with approximately 25% of the issued capital being voted and of
this 97% voting in favour of all resolutions.
The main thrust of the policy was that:
The Company proposes to draw on its six years experience in China and focus on
acquiring and developing mineral and energy projects in those commodities and
located in those countries which it believes will be of interest to Chinese
mining and other groups for either offtake, partnership or sale.
The Company has received over 50 projects for review and is actively reviewing
those that are considered to have the potential to meet the Company's investment
criteria.
Whilst the Company remains alive to a wide range of opportunities that meet the
investment guidelines both within China and elsewhere, the current focus is on a
broad region encompassing Northern China and Southern Mongolia and specifically
targeting primarily Coking Coal and Iron Ore.
The Company has quickly established excellent deal flow in these areas, building
on existing long term relationships in some cases and in others creating the
relationships and profile through introductions.
The Company has entered into a 51%:49% exploration and production joint venture
with Qiqiha'r Tai Fu Trading Company Ltd on the QHD Iron Mountain project in the
Tang Shan district of Hebei East China.
The Company is actively working on a number of other joint venture opportunities
in Coking Coal and Iron Ore that have the potential to fit the criteria set out
in the proposed investing policy.
Auditor's Independence Declaration
Section 307C of the Corporations Act 2001 requires our auditors, Deloitte Touche
Tohmatsu, to provide the directors of Leyshon Resources Limited with an
Independence Declaration in relation to the review of the half-year financial
report. This Independence Declaration is on page 16 and forms part of this
Directors' Report.
Signed in accordance with a resolution of Directors.
PAUL ATHERLEY
Director
Perth, 26 February 2010
DIRECTORS' DECLARATION
+-------------------------------------------------------------------+
| In accordance with a resolution of the directors on 26 February |
| 2010 of Leyshon Resources Limited, the directors declare that: |
+-------------------------------------------------------------------+
| |
+-------------------------------------------------------------------+
| In the opinion of the directors: |
+-------------------------------------------------------------------+
| (a) the attached financial statements and notes thereto are in |
| accordance with the Corporations Act 2001, including: |
+-------------------------------------------------------------------+
| (i) section 304 (compliance with accounting standards and |
| Corporations Regulations 2001); and |
+-------------------------------------------------------------------+
| (ii) section 305 (true and fair view); and |
+-------------------------------------------------------------------+
| (b) there are reasonable grounds to believe that the Company |
| will be able to pay its debts as and when they become due and |
| payable. |
+-------------------------------------------------------------------+
On behalf of the Board
PAUL ATHERLEY
Director
Perth, 26 February 2010
CONDENSED CONSOLIDATED INCOME STATEMENT
FOR THE HALF-YEAR ENDED 31 DECEMBER 2009
+---------------------------------+-------+-------------+-------------+
| | Note | Half-year | Half-year |
| | | Ended | Ended |
| | | 31 Dec 2009 | 31 Dec 2008 |
| | | $ | $ |
+---------------------------------+-------+-------------+-------------+
| Continuing operations | | | |
+---------------------------------+-------+-------------+-------------+
| Revenue | 2 | 106,847 | 293,581 |
+---------------------------------+-------+-------------+-------------+
| | | | |
+---------------------------------+-------+-------------+-------------+
| Other income | | - | 4,092 |
+---------------------------------+-------+-------------+-------------+
| Exploration expenses | | (146,218) | (641,244) |
+---------------------------------+-------+-------------+-------------+
| Administration expenses | | (881,391) | (980,532) |
+---------------------------------+-------+-------------+-------------+
| Business development expenses | | - | (172,743) |
+---------------------------------+-------+-------------+-------------+
| Foreign exchange gains/(losses) | | (276,762) | 148,234 |
+---------------------------------+-------+-------------+-------------+
| Share based payments | | - | (46,336) |
+---------------------------------+-------+-------------+-------------+
| | | (1,197,524) | (1,394,948) |
| Loss before tax | | | |
+---------------------------------+-------+-------------+-------------+
| Income tax expense | | - | - |
+---------------------------------+-------+-------------+-------------+
| Loss for the period from | | (1,197,524) | (1,394,948) |
| continuing operations | | | |
+---------------------------------+-------+-------------+-------------+
| | | | |
| Discontinued operations | | | |
+---------------------------------+-------+-------------+-------------+
| | | | |
| Profit/(loss) for the period | | | |
| from discontinued operations | 3 | 28,399,859 | (1,555,244) |
+---------------------------------+-------+-------------+-------------+
| | | 27,202,335 | (2,950,192) |
| Profit/(Loss) attributable to | | | |
| members of Leyshon Resources | | | |
| Limited | | | |
+---------------------------------+-------+-------------+-------------+
| | | | |
+---------------------------------+-------+-------------+-------------+
| Earnings Per Share | | | |
+---------------------------------+-------+-------------+-------------+
| From continuing and | | | |
| discontinued operations | | | |
+---------------------------------+-------+-------------+-------------+
| Basic (cents per share) | | 12.45 | (1.35) |
+---------------------------------+-------+-------------+-------------+
| Diluted (cents per share) | | 12.13 | (1.35) |
+---------------------------------+-------+-------------+-------------+
| | | | |
+---------------------------------+-------+-------------+-------------+
| From continuing operations | | | |
+---------------------------------+-------+-------------+-------------+
| Basic earnings per share (cents | | (0.55) | (0.64) |
| per share) | | | |
+---------------------------------+-------+-------------+-------------+
| Diluted earnings per share | | (0.55) | (0.64) |
| (cents per share) | | | |
+---------------------------------+-------+-------------+-------------+
The above Condensed Consolidated Income Statement should be read in conjunction
with the accompanying notes.
CONDENSED CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME
FOR THE HALF-YEAR ENDED 31 DECEMBER 2009
+---------------------------------+-------+-------------+-------------+
| | Note | Half-year | Half-year |
| | | Ended | Ended |
| | | 31 Dec 2009 | 31 Dec 2008 |
| | | $ | $ |
+---------------------------------+-------+-------------+-------------+
| | | | |
+---------------------------------+-------+-------------+-------------+
| Profit/(loss) for the period | | 27,202,335 | (2,950,192) |
+---------------------------------+-------+-------------+-------------+
| Other comprehensive income | | | |
+---------------------------------+-------+-------------+-------------+
| Exchange differences arising on | | | |
| translation of foreign | | (488,917) | 2,194,626 |
| operations | | | |
+---------------------------------+-------+-------------+-------------+
| | | | |
+---------------------------------+-------+-------------+-------------+
| Other comprehensive income for | | | |
| the period net of tax | | (488,917) | 2,194,626 |
| | | | |
+---------------------------------+-------+-------------+-------------+
| Total comprehensive income | | 26,713,418 | (755,566) |
| attributable to members of | | | |
| Leyshon Resources Limited | | | |
+---------------------------------+-------+-------------+-------------+
The above Condensed Consolidated Income Statement should be read in conjunction
with the accompanying notes.
CONDENSED CONSOLIDATED STATEMENT OF
FINANCIAL POSITION
AS AT 31 DECEMBER 2009
+----------------------------------+------+--------------+----------+--------------+
| |Note | 31 Dec | | 30 June |
| | | 2009 | | 2009 |
| | | $ | | $ |
+----------------------------------+------+--------------+----------+--------------+
| ASSETS | | | | |
+----------------------------------+------+--------------+----------+--------------+
| Current Assets | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | 48,300,493 | | 3,918,963 |
| Cash and cash equivalents | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | 94,182 | | 76,010 |
| Trade and other receivables | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | 35,861 | | 14,078 |
| Other | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | 48,430,536 | | 4,009,051 |
+----------------------------------+------+--------------+----------+--------------+
| | | - | | 24,328,083 |
| Assets classified as held for | | | | |
| sale | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | 48,430,536 | | 28,337,134 |
| Total Current Assets | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | | | |
+----------------------------------+------+--------------+----------+--------------+
| Non-Current Assets | | | | |
+----------------------------------+------+--------------+----------+--------------+
| Other financial assets at fair | | 1 | | 1 |
| value through profit and loss | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | 14,999 | | 14,999 |
| Other financial assets | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | 11,613 | | 2,771 |
| Property, plant and equipment | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | 25,613 | | 17,771 |
| Total Non-Current Assets | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | | | |
+----------------------------------+------+--------------+----------+--------------+
| TOTAL ASSETS | | 48,457,149 | | 28,354,905 |
+----------------------------------+------+--------------+----------+--------------+
| | | | | |
+----------------------------------+------+--------------+----------+--------------+
| LIABILITIES | | | | |
+----------------------------------+------+--------------+----------+--------------+
| Current Liabilities | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | 323,769 | | 1,567,699 |
| Trade and other payables | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | 41,815 | | 45,452 |
| Provisions | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | 365,584 | | 1,613,151 |
+----------------------------------+------+--------------+----------+--------------+
| Liabilities directly associated | | - | | 5,363,607 |
| with assets held for sale | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | 365,584 | | 6,976,758 |
| Total Current Liabilities | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | | | |
+----------------------------------+------+--------------+----------+--------------+
| TOTAL LIABILITIES | | 365,854 | | 6,976,758 |
+----------------------------------+------+--------------+----------+--------------+
| NET ASSETS | | 48,091,565 | | 21,378,147 |
+----------------------------------+------+--------------+----------+--------------+
| | | | | |
+----------------------------------+------+--------------+----------+--------------+
| EQUITY | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | 64,552,218 | | 64,552,218 |
| Issued capital | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | 1,373,173 | | 2,430,810 |
| Reserves | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | (17,833,826) | | (45,604,881) |
| Accumulated losses | | | | |
+----------------------------------+------+--------------+----------+--------------+
| | | | | |
+----------------------------------+------+--------------+----------+--------------+
| TOTAL EQUITY | | 48,091,565 | | 21,378,147 |
+----------------------------------+------+--------------+----------+--------------+
The above Condensed Consolidated Statement of Financial Position should be read
in conjunction with the accompanying notes.
CONDENSED CONSOLIDATED STATEMENT OF
CHANGES IN EQUITY
+----------------------------------+--------+------------+------------+
| | | Half-year | Half-year |
| | | Ended | Ended |
| | | 31 Dec | 31 Dec |
| | | 2009 | 2008 |
| | | $ | $ |
+----------------------------------+--------+------------+------------+
| Issued Capital | | |
+-------------------------------------------+------------+------------+
| Issued and paid up capital - at the | 64,552,218 | 64,507,082 |
| beginning of the half-year | | |
+-------------------------------------------+------------+------------+
| Transactions with equity holders in their | | |
| capacity as equity holders: | | |
+-------------------------------------------+------------+------------+
| Issue of shares as part of | - | 46,336 |
| employee benefits | | |
+-------------------------------------------+------------+------------+
| Less share issue costs | - | (1,200) |
+-------------------------------------------+------------+------------+
| | - | 45,136 |
+-------------------------------------------+------------+------------+
| Issued and paid up capital - at the end | 64,552,218 | 64,552,218 |
| of the half-year | | |
+-------------------------------------------+------------+------------+
| | | |
+-------------------------------------------+------------+------------+
| Employee Benefit Reserve | | |
+-------------------------------------------+------------+------------+
| Balance at the beginning of the half-year | 1,941,893 | 1,941,893 |
+-------------------------------------------+------------+------------+
| Transactions with equity holders in their | | |
| capacity as equity holders: | | |
+-------------------------------------------+------------+------------+
| Expiry of options | (568,720) | - |
+-------------------------------------------+------------+------------+
| | | |
+-------------------------------------------+------------+------------+
| Employee benefit reserve at the end of | 1,373,173 | 1,941,893 |
| the half-year | | |
+-------------------------------------------+------------+------------+
| | | |
+-------------------------------------------+------------+------------+
| Option Premium Reserve | | |
+-------------------------------------------+------------+------------+
| Option premium reserve at the beginning | - | 112,841 |
| of the half-year | | |
+-------------------------------------------+------------+------------+
| | | |
+-------------------------------------------+------------+------------+
| Option premium reserve at the end of the | - | 112,841 |
| half-year | | |
+-------------------------------------------+------------+------------+
| | | |
+-------------------------------------------+------------+------------+
| Foreign Exchange Reserve | | |
+-------------------------------------------+------------+------------+
| Foreign exchange reserve at the beginning | 488,917 | (497,768) |
| of the half-year | | |
+-------------------------------------------+------------+------------+
| | | |
+-------------------------------------------+------------+------------+
| Exchange differences on translation of | (488,917) | 2,194,626 |
| foreign operations attributable to | | |
| members of Leyshon Resources Limited | | |
+-------------------------------------------+------------+------------+
| | | |
+-------------------------------------------+------------+------------+
| Total comprehensive income for the period | (488,917) | 2,194,626 |
+-------------------------------------------+------------+------------+
| | | |
+-------------------------------------------+------------+------------+
| Foreign exchange reserve at the end of | - | 1,696,858 |
| the half-year | | |
+-------------------------------------------+------------+------------+
| | | |
+-------------------------------------------+------------+------------+
| Total reserves at the end of the | 1,373,173 | 3,751,592 |
| half-year | | |
+----------------------------------+--------+------------+------------+
CONDENSED CONSOLIDATED STATEMENT OF
CHANGES IN EQUITY
+----------------------------------+-------+-------+---------+-------+-------+-------+-+
| | | Half-year Ended | Half-year Ended | |
| | | 31 Dec 2009 | 31 Dec 2008 | |
| | | $ | $ | |
+----------------------------------+-------+-----------------+-----------------------+-+
| Accumulated Losses | | | |
+------------------------------------------+-----------------+-----------------------+-+
| Accumulated losses at the beginning of | (45,604,881) | (42,319,895) | |
| the half-year | | | |
+------------------------------------------+-----------------+-----------------------+-+
| | | | |
+------------------------------------------+-----------------+-----------------------+-+
| Profit/(Loss) for the half-year | 27,202,335 | (2,950,192) | |
| attributable to members of Leyshon | | | |
| Resources Limited | | | |
+------------------------------------------+-----------------+-----------------------+-+
| | | | |
+------------------------------------------+-----------------+-----------------------+-+
| Total comprehensive income for the | 27,202,335 | (2,950,192 | |
| period | | | |
+------------------------------------------+-----------------+-----------------------+-+
| | | |
| Transactions with equity holders in their | | |
| capacity as equity holders: | | |
+--------------------------------------------------+-----------------+-----------------+
| Transfer from employee benefit | 568,720 | - | |
| reserve | | | |
+--------------------------------------------------+---------+---------------+---------+
| | | | |
+------------------------------------------+-----------------+-----------------------+-+
| Accumulated losses at the end of the | (17,833,826) | (45,270,087) | |
| half-year | | | |
+----------------------------------+-------+-------+---------+-------+-------+-------+-+
The above Condensed Consolidated Statement of Changes in Equity should be read
in conjunction with the accompanying notes.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE HALF-YEAR ENDED 31 DECEMBER 2009
+------------------------------------+-+--------------+-+--------------+
| | | Half-year | | Half-year |
| | | ended | | ended |
| | | 31 Dec 2009 | | 31 Dec 2008 |
| | | $ | | $ |
+------------------------------------+-+--------------+-+--------------+
| | | | | |
+------------------------------------+-+--------------+-+--------------+
| CASH FLOWS FROM OPERATING | | | | |
| ACTIVITIES | | | | |
+------------------------------------+-+--------------+-+--------------+
| Payments to suppliers and | | (882,145) | | (2,808,354) |
| employees | | | | |
+------------------------------------+-+--------------+-+--------------+
| Interest received | | 57,886 | | 194,716 |
+------------------------------------+-+--------------+-+--------------+
| | | (824,259) | | (2,613,638) |
| Net cash flows used in operating | | | | |
| activities | | | | |
+------------------------------------+-+--------------+-+--------------+
| | | | | |
+------------------------------------+-+--------------+-+--------------+
| CASH FLOWS FROM INVESTING | | | | |
| ACTIVITIES | | | | |
+------------------------------------+-+--------------+-+--------------+
| Acquisition of plant and equipment | | (1,200) | | (2,580) |
+------------------------------------+-+--------------+-+--------------+
| Proceeds from sale of interest in | | 46,039,933 | | - |
| jointly controlled entity | | | | |
+------------------------------------+-+--------------+-+--------------+
| Loans to other entities | | (50,276) | | (475,549) |
+------------------------------------+-+--------------+-+--------------+
| Development expenditure | | (505,906) | | (721,546) |
+------------------------------------+-+--------------+-+--------------+
| | | 45,482,551 | | (1,199,863) |
| Net cash flows used in investing | | | | |
| activities | | | | |
+------------------------------------+-+--------------+-+--------------+
| | | | | |
+------------------------------------+-+--------------+-+--------------+
| NET INCREASE/(DECREASE) IN CASH | | 44,658,292 | | (3,813,501) |
| AND CASH EQUIVALENTS | | | | |
+------------------------------------+-+--------------+-+--------------+
| | | | | |
+------------------------------------+-+--------------+-+--------------+
| Cash and cash equivalents at the | | 3,918,963 | | 9,399,324 |
| beginning of the half-year | | | | |
+------------------------------------+-+--------------+-+--------------+
| Effects of exchange rate changes | | (276,762) | | 148,234 |
| on cash and cash equivalents | | | | |
+------------------------------------+-+--------------+-+--------------+
| | | | | |
+------------------------------------+-+--------------+-+--------------+
| | | 48,300,493 | | 5,734,057 |
| CASH AND CASH EQUIVALENTS AT THE | | | | |
| END OF THE HALF-YEAR | | | | |
+------------------------------------+-+--------------+-+--------------+
| | | | | |
+------------------------------------+-+--------------+-+--------------+
The above Condensed Consolidated Statement of Cash Flows should be read in
conjunction with the accompanying notes.
NOTES TO THE FINANCIAL STATEMENTS
FOR THE HALF-YEAR ENDED 31 DECEMBER 2009
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This general purpose financial report for the interim half-year reporting period
ended 31 December 2009 has been prepared in accordance with Accounting Standard
AASB 134 Interim Financial Reporting and the Corporations Act 2001. Compliance
with AASB 134 ensures compliance with International Financial Reporting Standard
IAS 34 Interim Financial Reporting.
This interim financial report does not include all the notes of the type
normally included in an annual financial report. Accordingly, this report is to
be read in conjunction with the annual report of Leyshon Resources Limited for
the year ended 30 June 2009 and any public announcements made by Leyshon
Resources Limited and its subsidiaries during the interim reporting period in
accordance with the continuous disclosure requirements of the Corporations Act
2001.
(a) Basis of preparation of half-year financial report
The condensed consolidated financial statements have been prepared on the basis
of historical cost, except for the revaluation of certain non-current assets and
financial instruments. Cost is based on the fair values of the consideration
given in exchange for assets. All amounts are presented in Australian dollars.
The accounting policies and methods of computation adopted in the preparation of
the half-year financial report are consistent with those adopted and disclosed
in the Company's 2009 annual financial report for the year ended 30 June 2009,
unless otherwise indicated.
(b) Adoption of new and revised Accounting Standards
In the current period, the Consolidated Entity has adopted all of the new and
revised Standards and Interpretations issued by the Australian Accounting
Standards Board ("AASB") that are relevant to its operations and effective for
annual reporting periods beginning on or after 1 July 2009. The standards
adopted are:
· AASB 3 : "Business Combinations"
· AASB 8 : "Operating Segments"
· AASB 2007-3 "Amendments to Australian Accounting Standards arising from
AASB 8"
· AASB 101 : "Presentation of Financial Statements"
· AASB 127 : "Consolidated and Separate Financial Statements"
· AASB 2009-4 : "Amendments to Australian Accounting Standards arising from
the Annual Improvements Project"
The adoption of these new and revised Standards and Interpretations has resulted
in some disclosure changes being made.
+-----+-----------------------------+----------+------+-----------+----------+-----------+----------+
| 2. | REVENUE | | | | | |
+-----+-----------------------------+-----------------+-----------+----------+-----------+----------+
| | | | Half-year | | Half-year | |
| | | | Ended | | Ended | |
| | | | 31 | | 31 | |
| | | | December | | December | |
| | | | 2009 | | 2008 | |
| | | | $ | | $ | |
+-----+----------------------------------------+------+-----------+----------+-----------+----------+
| | | | | | | |
+-----+----------------------------------------+------+-----------+----------+-----------+----------+
| | Interest received/receivable | | 106,847 | | 293,581 | |
+-----+----------------------------------------+------+-----------+----------+-----------+----------+
| | | | | | | | |
+-----+-----------------------------+----------+------+-----------+----------+-----------+----------+
3. GAIN ON DISPOSAL OF INTEREST IN JOINTLY CONTROLLED ENTITY
On 2 December 2009 the Company disposed of its 70% interest in the
Sino Foreign Joint Venture company Black Dragon Mining Company Limited (Black
Dragon), which owns the Zheng Guang Gold Project.
+-----+-----------------------------------+------+------------+----------+-------------+----------+
| | | | *Period | | Half-year | |
| | | | from | | Ended | |
| | | | 1 July | | 31 | |
| | | | 2009 to | | December | |
| | | | 2 | | 2008 | |
| | | | December | | $ | |
| | | | 2009 | | | |
| | | | $ | | | |
+-----+-----------------------------------+------+------------+----------+-------------+----------+
| | | | | | | |
+-----+-----------------------------------+------+------------+----------+-------------+----------+
| | Exploration loss for the period | | (156,714) | | (1,555,244) | |
+-----+-----------------------------------+------+------------+----------+-------------+----------+
| | Gain on disposal of interest in | | 28,556,573 | | - | |
| | Black Dragon | | | | | |
+-----+-----------------------------------+------+------------+----------+-------------+----------+
| | | | | | (1,555,244) | |
| | | | 28,399,859 | | | |
+-----+-----------------------------------+------+------------+----------+-------------+----------+
The following were the results for the Consolidated Entity's interest
in Black Dragon for the period:
+-----+-----------------------------------+------+-----------+----------+-------------+----------+
| | Revenue | | - | | - | |
+-----+-----------------------------------+------+-----------+----------+-------------+----------+
| | Operating expenses | | (156,714) | | (1,555,244) | |
+-----+-----------------------------------+------+-----------+----------+-------------+----------+
| | | | | | | |
| | Loss before income tax | | (156,714) | | (1,555,244) | |
+-----+-----------------------------------+------+-----------+----------+-------------+----------+
| | | | - | | - | |
| | Income tax expense | | | | | |
+-----+-----------------------------------+------+-----------+----------+-------------+----------+
| | | | | | | |
| | Loss after income tax | | (156,714) | | (1,555,244) | |
+-----+-----------------------------------+------+-----------+----------+-------------+----------+
3. GAIN ON DISPOSAL OF INTEREST IN JOINTLY CONTROLLED ENTITY (Continued)
The Consolidated Entity's interest in the net assets of Black Dragon at
the date of disposal was as follows:
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | | | 2 | | | |
| | | | December | | | |
| | | | 2009 | | | |
| | | | $ | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Book value of net assets sold | | | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Current assets | | | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Cash and cash equivalents | | 5,699 | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Trade and other receivables | | 1,245,860 | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | | | | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Non-current assets | | | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Development properties | | 23,918,553 | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Other financial assets | | 3,560,518 | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | | | | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Current liabilities | | | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Trade and other payables | | (827,495) | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | | | | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Non-current liabilities | | | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Deferred tax liabilities | | (3,604,688) | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | | | | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Net assets disposed | | 24,298,447 | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | | | | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Less withholding tax for equity | | (3,077,876) | | | |
| | transfer | | | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | | | | | | |
| | | | 21,220,571 | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Gain on disposal | | 28,556,573 | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | | | 49,777,144 | | | |
| | Total consideration | | | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | | | | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Consideration | | | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Cash and cash equivalents | | 46,039,933 | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | Liabilities assumed by purchaser | | 3,737,211 | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
| | | | | | | |
| | | | 49,777,144 | | | |
+-----+-----------------------------------+------+-------------+----------+-----------+----------+
A gain of $28,556,573 was recognised on the disposal of the
Consolidated Entity's interest in Black Dragon. People's Republic of China
withholding tax of $3,077,876 was withheld from the sale proceeds. No other tax
charge or credit arose on the transaction.
4. DIVIDENDS PAID OR PROVIDED FOR
No dividends have been paid or provided for during the half-year.
5. SEGMENT INFORMATION
The Consolidated Entity has adopted AASB 8 Operating Segments and AASB
2007-3 Amendments to Australian Accounting Standards arising from AASB 8 with
effect from 1 January 2009. AASB 8 requires operating segments to be identified
on the basis of internal reports about components of the Consolidated Entity
that are regularly reviewed by the chief operating decision maker in order to
allocate resources to the segment and to assess its performance. In contrast,
the predecessor Standard (AASB 114 Segment Reporting) required an entity to
identify two sets of segments (business and geographical), using a risks and
rewards approach, with the entity's 'system of internal financial reporting to
key management personnel' serving only as the starting point for the
identification of such segments. As a result, following the adoption of AASB 8,
the identification of the Consolidated Entity's reportable segments has changed.
In previous years, segment information reported externally was analysed
on the basis of the geographical areas in which it operated its business of
exploration of gold and other minerals. However, information reported to the
Consolidated Entity's Managing Director for the purposes of resource allocation
and assessment of performance is more specifically focused on one operating
segment, being the exploration of gold and other minerals.
The accounting policies of the new reportable segment are the same as
those of the Consolidated Entity. As the Consolidated Entity has only one
operating segment, all the necessary reporting disclosures are disclosed
elsewhere in the notes to the financial statements.
On 2 December 2009 the Consolidated Entity sold its interest in the
Zheng Guang Gold Project in China and is actively seeking other projects in the
China region to invest in that meet its investment guidelines.
6. SUBSEQUENT EVENTS AFTER BALANCE DATE
On 19 January 2010 the Company commenced an on-market share buy-back of
up to 21,800,000 fully paid ordinary shares, approximately 10% of the Company's
fully paid share capital.
The Company also announced that it has entered into a 51%:49%
exploration and production joint venture with Qiqiha'r Tai Fu Trading Company
Ltd on the QHD Iron Mountain project in the Tang Shan district of Hebei East
China.
There were no other significant events occurring after balance date
requiring disclosure in the financial statements.
7. COMMITMENTS AND CONTINGENCIES
Commitments
+-------------------------+--------+-----------+-----------+
| COMMITMENTS FOR | | Half-year | Half-year |
| EXPENDITURE | | Ended | Ended |
| | | 31 | 31 |
| | | December | December |
| | | 2009 | 2008 |
+-------------------------+--------+-----------+-----------+
| | | $ | $ |
+-------------------------+--------+-----------+-----------+
| | | |
+----------------------------------+-----------+-----------+
| Development Expenditure | | |
+----------------------------------+-----------+-----------+
| Not longer than 1 year | - | 2,197,980 |
+----------------------------------+-----------+-----------+
| Longer than 1 year and not | - | - |
| longer than 5 years | | |
+----------------------------------+-----------+-----------+
| Longer than 5 years | - | - |
+----------------------------------+-----------+-----------+
| Total Commitments | - | 2,197,980 |
+-------------------------+--------+-----------+-----------+
There were no changes to the operating leases commitment during the half-year
reporting period.
Contingencies
There has been no material change in the contingent assets or liabilities of the
Consolidated Entity during the half-year.
8. ISSUANCES, REPURCHASES AND REPAYMENTS OF EQUITY SECURITIES
There were no movements in ordinary share capital or other issued share capital
of the Company during the current half-year reporting period (2008: The Company
issued 144,801 ordinary shares for a total value before issue costs of $46,336).
During the half-year reporting period, 1,250,000 options over ordinary shares
expired (2008: No movement in options over ordinary shares).
9. AVAILABILITY OF REPORT
This half year report is available to be viewed on the Company's website,
www.leyshonresources.com, and on the website of the ASX, www.asx.com.au.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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