TIDMAHG
RNS Number : 5616I
Athol Gold Limited
16 June 2011
Athol Gold Limited 16 June 2011 (formerly Hameldon Resources
Limited.)
Final Results
For the year ended 31 December 2010
Dear Shareholders,
I would like to introduce myself as your new Chairman and am
pleased to announce the results of your Company for the year ended
31 December 2010 and other news. As most of the events mentioned
occurred prior to my joining the board, I will provide an overview
for 2010 and then give a guide to what we expect for 2011.
OVERVIEW
For the first nine months of the year the directors continued
their search for suitable investment opportunities in the natural
resources sector. Then in October 2010 the board decided to bring
in a new management team and appointed Tom Winnifrith, manager of
the SF t1ps Smaller Companies Gold Fund, as the Company's Chief
Investment Officer with a mandate to invest in the shares of
principally gold and precious metal companies quoted on stock
exchanges in the UK, Canada and Australia, and at the same time the
Gold Fund participated in a GBP500,000 fund raising by the Company.
Then in November the Company raised an additional GBP670,000
through a private placing.
The Company's first investment was in Ascot Mining Plc ("Ascot
") via a subscription for GBP430,000 of convertible loan stock with
attached warrants. Ascot Mining has a focus on gold production in
Costa Rica, its flagship asset being the Chassoul Gold Mine, where
gold production is targeted to reach 1,200 ounces per month in
2011. The market value of Athol's investment in Ascot at the
year-end was GBP1.7 million.
FINANCIAL STATEMENTS
During the year Athol's net assets have grown from GBP318,000 to
GBP2,512,000, and the net asset value per share has gone up by 278%
from 0.23p to 0.64p. After allowing for the performance related
investment management charge of GBP236,000 there has been a small
reduction in overhead costs from GBP258,000 in 2009 to GBP247,000
for 2010. We expect there to be a much greater reduction in
overhead costs in 2011.
PROSPECTS FOR 2011
Our largest investment remains Ascot Mining Plc. It continues to
make progress both operationally and with its proposed move from
Plus to AIM, which we believe will result in a material re-rating
of its shares.
In February the Company made its second largest investment to
date acting as a cornerstone investor in a GBP1.1 million placing
by Ariana Resources Plc at 4.75p (each share coming with one
warrant at 4.75p). Ariana is just over a year away from production
and needs no further equity funding, so we are extremely optimistic
about its prospects.
We remain positive about the outlook for gold prices, gold
equities and our portfolio in particular. In addition to our two
largest holdings, Ascot and Ariana, a number of our other
investments are also entering exciting phases in their development.
So far in 2011 the gold price has held up well but gold equities
have performed poorly. However, as the gold price rises further and
as M & A activity in the sector picks up we expect a
substantial re-rating of mid cap gold equities which will
inevitably boost your company's net asset value.
Jennifer Allsop, Chairman
www.atholgold.com
2010 2009
Notes GBP'000 GBP'000
------------------------------------------ ------ -------- ---------
Continuing operations:
Net gain on disposal of investments 23 -
Change in fair value of investments 1,525 -
Total income 1,548 -
Operating expenses (483) (258)
------------------------------------------ ------ -------- ---------
Operating profit 3 1,065 (258)
Finance cost (2) -
Profit/(loss) before taxation 1,063 (258)
Taxation expense 5 - -
Profit/(loss) from continuing operations 1,063 (258)
Discontinued Operations:
(Loss) from discontinued operations 6 - (16,770)
------------------------------------------ ------ -------- ---------
Profit/(loss) for the year and total
comprehensive income, attributable to
owners of the Company 1,063 (17,028)
Earnings/(loss) per share attributable
to owners of the Company during the
year 7 pence pence
Basic:
Continuing operations 0.62 (0.19)
Discontinued operations - (12.20)
------------------------------------------ ------ -------- ---------
Total 0.62 (12.39)
------------------------------------------ ------ -------- ---------
Diluted:
Continuing operations 0.56 (0.19)
Discontinued operations - (12.20)
------------------------------------------ ------ -------- ---------
Total 0.56 (12.39)
------------------------------------------ ------ -------- ---------
2010 2009
Notes GBP'000 GBP'000
-------------------------------------- ------ --------- ---------
CURRENT ASSETS
Financial assets 8 2,869 -
Trade and other receivables 9 28 16
Cash and cash equivalents 42 462
-------------------------------------- ------ --------- ---------
2,939 478
-------------------------------------- ------ --------- ---------
CURRENT LIABILITIES
Trade and other payables 10 290 160
-------------------------------------- ------ --------- ---------
290 160
-------------------------------------- ------ --------- ---------
NET CURRENT ASSETS 2,649 318
NON-CURRENT LIABILITIES
Convertible unsecured loan notes 11 137 -
137 -
-------------------------------------- ------ --------- ---------
NET ASSETS 2,512 318
-------------------------------------- ------ --------- ---------
EQUITY
Share capital 12 981 343
Share premium 2,838 2,391
Loan note equity reserve 11 45 -
Capital reserve 15,736 15,736
Retained earnings (17,088) (18,152)
-------------------------------------- ------ --------- ---------
Equity attributable to owners of the
Company and total equity 2,512 318
-------------------------------------- ------ --------- ---------
Share Share Loan note Capital Accumulated Total
capital premium reserve reserve losses equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------- -------- -------- --------- -------- ----------- --------
At 1 January
2009 343 2,391 - 15,736 (1,174) 17,296
Loss for the
year - - - - (17,028) (17,028)
Total
comprehensive
income for
the year - - - - (17,028) (17,028)
-------------- -------- -------- --------- -------- ----------- --------
Share based
payments - - - - 50 50
At 31 December
2009 343 2,391 - 15,736 (18,152) 318
Profit for the
year - - - - 1,063 1,063
Total
comprehensive
income for
the year - - - - 1,063 1,063
-------------- -------- -------- --------- -------- ----------- --------
Share based
payments - - - - 1 1
Issue of loan
notes - - 45 - - 45
Share issues 638 505 - - - 1,143
Share issue
expenses - (58) - - - (58)
At 31
December
2010 981 2,838 45 15,736 (17,088) 2,512
-------------- -------- -------- --------- -------- ----------- --------
2010 2009
GBP'000 GBP'000
------------------------------------------------- -------- --------
OPERATING ACTIVITIES
Continuing operations:
Profit/(Loss) before taxation 1,063 (258)
Adjustments for:
Share based payment charge 1 50
Profit on disposal of trading investments (23) -
Fair value gain on trading investments (1,525) -
Finance costs 2
------------------------------------------------- -------- --------
Operating cashflow before working capital
changes (482) (208)
(Decrease) in trade and other receivables (12) (2)
Increase/(decrease) in trade and other payables 130 (339)
------------------------------------------------- -------- --------
Net cash outflow from operating activities
from continuing operations (364) (549)
Discontinued operations:
Net cash flow from operating activities
from discontinued operations - -
------------------------------------------------- -------- --------
Net cash outflow from operating activities (364) (549)
------------------------------------------------- -------- --------
INVESTING ACTIVITIES
Continuing operations:
Purchases of investments (1,548) -
Disposals of investments 227 -
------------------------------------------------- -------- --------
Net cash outflow from investing activities
from continuing operations (1,321) -
Discontinued operations:
Net cash inflow from investing activities
from discontinued operations - 1,006
Net cash (outflow)/inflow from investing
activities (1,321) 1,006
------------------------------------------------- -------- --------
FINANCING ACTIVITIES
Continuing operations:
Proceeds from share issues 1,143 -
Share issue expenses (58) -
Proceeds from issue of convertible loan
notes 180 -
Net cash inflow from financing activities
from continuing operations 1,265 -
------------------------------------------------- -------- --------
Net (decrease)/increase in cash and cash
equivalents (420) 457
Cash and cash equivalents as at 1 January 462 5
Cash and cash equivalents as at 31 December 42 462
------------------------------------------------- -------- --------
1 GENERAL INFORMATION
The Company was incorporated as a Corporation in the Cayman
Islands which does not prescribe the adoption of any particular
accounting framework. The Board has therefore adopted International
Financial Reporting Standards as adopted by the European Union
(IFRSs). The Company's shares are listed on the AIM market of
the London Stock Exchange.
The Company is an investment company, investing in natural resources,
minerals, metals, and oil and gas projects.
The principal accounting policies of the Company, which are
consistent with those applied in the 2009 financial statements
are set out in the annual report and financial statements.
GOING CONCERN
The Directors have prepared cash flow forecasts through to 30
June 2012 which assume no significant investment activity is
undertaken unless sufficient funding is in place to undertake
the investment activity. The expenses of the Company's continuing
operations are minimal and the cash flow forecasts demonstrate
that the Company is able to meet these liabilities as they fall
due. On this basis, the Directors have a reasonable expectation
that the Company has adequate resources to continue operating
for the foreseeable future. For this reason they continue to
adopt the going concern basis in preparing the Company's financial
statements.
2 OPERATING PROFIT
2010 2009
GBP'000 GBP'000
-------------------------------------------- -------- --------
Profit/(loss) from operations is arrived
at after charging/(crediting):
Investment management fee 236 -
Foreign exchange losses - 29
Auditors' remuneration:
- fees payable to the Company's auditors
and its
associates for the audit of the Company's
financial
statements 15 15
3 TAXATION
No provision has been made in respect of current taxation or
deferred taxation as the Company is domiciled in the Cayman
Islands and no corporation tax is applicable,.
4 EARNINGS PER SHARE
The basic and diluted earnings per share is calculated by
dividing the profit/(loss) attributable to owners of the Company
by the weighted average number of ordinary shares in issue
during the year.
2010 2009
GBP'000 GBP'000
------------------------------------------- ------------ ------------
Profit/(loss) attributable to owners
of the Company
- Continuing operations 1,063 (258)
- Discontinued operations - (16,770)
----------------------------------------------- ------------ ------------
1,063 (17,028)
----------------------------------------------- ------------ ------------
2010 2009
----------------------------------------------- ------------ ------------
Weighted average number of shares
for calculating basic earnings per
share 171,156,251 137,401,194
----------------------------------------------- ------------ ------------
Weighted average number of shares
for calculating fully diluted earnings
per share 190,070,885 137,401,194
----------------------------------------------- ------------ ------------
2010 2009
pence pence
----------------------------------- ------ --------
Basic earnings/(loss) per share
- Continuing operations 0.62 (0.19)
- Discontinued operations - (12.20)
----------------------------------- ------ --------
0.62 (12.39)
----------------------------------- ------ --------
Fully diluted earnings/(loss) per
share
- Continuing operations 0.56 (0.19)
- Discontinued operations - (12.20)
----------------------------------- ------ --------
0.56 (12.39)
----------------------------------- ------ --------
The diluted loss per share for 2009 was the same as the basic
loss per share as the effect of exercise of the outstanding share
options, which were cancelled in October 2009, was
anti-dilutive.
5 FINANCIAL ASSETS
2010 2009
GBP'000 GBP'000
--------------------------------------------------- ---------- ---------
Level 1 - Quoted investments:
At beginning of year - -
Cost of share purchases 1,498 -
Proceeds of share disposals (227) -
Profit on disposal of shares 14 -
Fair value adjustment 1,534 -
--------------------------------------------------- ---------- ---------
At end of year 2,819 -
--------------------------------------------------- ---------- ---------
Level 3 - Unquoted investments:
At beginning of year - -
Cost of share purchases 50 -
--------------------------------------------------- ---------- ---------
At end of year 50 -
--------------------------------------------------- ---------- ---------
Total financial assets at end of year 2,869 -
The Company has adopted fair value measurements using the
IFRS 7 fair value hierarchy
Categorisation within the hierarchy has been determined on
the basis of the lowest level of input that is significant
to the fair value measurement of the relevant asset as follows:
Level 1 - valued using quoted prices in active markets for
identical assets
Level 2 - valued by reference to valuation techniques using
observable inputs other than quoted prices included in Level
1.
Level 3 - valued by reference to valuation techniques using
inputs that are not based on observable market criteria.
6 CONVERTIBLE UNSECURED LOAN NOTES
The convertible loan notes were issued in October. They are
zero coupon and unsecured. Unless previously purchased, redeemed
or converted they are redeemable at their principal amount
on 31 October 2015.
The net proceeds from the issue of the loan notes have been
split between the liability element and an equity component,
representing the fair value of the embedded option to convert
the liability into equity of the Company as follows:
2010 2009
GBP'000 GBP'000
----------------------------------------------------- --------- ---------
Nominal value of convertible loan notes 180 -
issued
Equity component (45) -
----------------------------------------------------- --------- ---------
135 -
Interest charged 2 -
----------------------------------------------------- --------- ---------
Liability component at 31 December 137 -
The interest charged during the period is calculated by applying
an effective average interest rate of 10% to the liability
component for the period since the loan notes were issued.
The Directors estimate the fair value of the liability component
of the loan notes at 31 December 2010 to be approximately
GBP135,000. This fair value has been calculated by discounting
the future cash flows at the market rate of 10%.
7 SHARE CAPITAL
Number of
ordinary Value
shares GBP'000
------------------------------------------- -------------- ---------
Authorised (par value of 0.25p):
At 31 December 2009 and 31 December 2010 4,000,000,000 10,000
----------------------------------------------- -------------- ---------
Issued and fully paid (par value of 0.25p
each):
At 31 December 2009 137,401,194 343
Shares issued in year 254,883,672 638
----------------------------------------------- -------------- ---------
At 31 December 2010 392,284,866 981
----------------------------------------------- -------------- ---------
On 26 October 2010, 27,480,000 shares were issued at 0.25p
each for cash, as a result of a private placing.
On 22 November 2010, 15,217,008 shares were issued at 1p each
in lieu of directors fees.
On 25 November 2010, 80,000,000 shares were issued at 0.25p
each as a result of the conversion of loan notes.
On 2 December 2010, 111,666,664 shares were issued at 0.6p
each for cash as the result of a private placing.
Between 17 December and 22 December 2010, a total of 20,520,000
shares were issued at 0.25p each as a result of the conversion
of loan notes.
8 SHARE OPTIONS
The Company adopted an employee Share Option Scheme in order
to incentivise key management and staff. The fair value of
options granted was determined using Black-Scholes valuation
models. Significant inputs into the calculations were as follows:
-- 15% volatility based on expected share price (ascertained
by reference to historic share prices of the Company for the
12 months prior to the date of grant)
-- share price of 0.82p per share at date of grant of options
-- exercise price of 0.82p per share
-- a risk free interest rate of 3.5%
-- 0% dividend yield
-- estimated option life of five years.
The Company had 5,487,804 options outstanding at the end of
2010 (2009: Nil). The share based payment charge for the year
was GBP1,000 (2009: GBP50,000). The options outstanding at
the year-end vest on the third anniversary of the date of
grant and if not previously exercised lapse on the tenth anniversary
of the date of grant.
The movements on share options and their weighted average
exercise price are as follows:
2010 2009
Weighted Weighted
average average
exercise exercise
price price
Number (pence) Number (pence)
--------------------- ---------- ---------- ------------- ------------
Outstanding at 1 January - - 13,677,084 13.32
Granted 5,487,804 0.82 - -
Lapsed - - - -
Cancelled - - (13,677,084) (13.32)
------------------------ ---------- ---------- ------------- ------------
Outstanding at 31
December 5,487,804 0.82 - -
------------------------ ---------- ---------- ------------- ------------
9 POST BALANCE SHEET EVENTS
Since the balance sheet date the Company has issued further
shares as follows:
Between 11 January and 18 January 2011, 54,000,000 shares were
issued at 0.25p each as a result of the conversion of loan
notes
Between 31 January and 3 February 2011, 72,996,988 shares were
issued for cash at 0.83p each as the result of a private placing.
On 21 February 2011, 32,901,200 shares were issued at 1p each
as a result of the conversion of loan notes
Also on 21 February 2011, 19,156,627 shares were issued at
0.83p each as a result of the conversion of loan notes
10 RELATED PARTY TRANSACTIONS
The chief investment officer and investment manager of the
Company are also responsible for the investment management
of SF t1ps Smaller Companies Gold Fund and SF t1ps Smaller
Companies Growth Fund, which have major shareholdings in the
Company, as detailed in the Directors' report. The fee due
to t1ps Investment Management in respect of 2010 was GBP236,000
which has been charged in the Income statement and included
in accrued expenses at the year-end. There was no equivalent
amount in 2009.
In February 2011 GBP329,012 convertible loan notes (convertible
at 1p per share) were issued to t1ps Investment Management
(IOM) Ltd in settlement of fees due for the period to 25 January
2011.
11 PUBLICATION OF NON-STATUTORY ACCOUNTS
The financial information set out in this preliminary announcement
does not constitute statutory accounts as defined in section
434 of the Companies Act 2006.
The statement of financial position at 31 December 2009 and
the statement of comprehensive income, the statement of changes
in equity, the statement of cash flows and the associated notes
for the year then ended have been extracted from the Company's
financial statements upon which the auditor's opinion is unqualified
and does not include any statement under section 498 of the
Companies Act 2006.
The accounts for the year ended 31 December 2010 will be posted
to shareholders and laid before the Company at the Annual General
Meeting in due course. Copies will also be available from the
registered office of the Company and via the Company's website
www.atholgold.com.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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