RNS Number:6024E
Berkeley Resources Limited
27 September 2007
BERKELEY RESOURCES LIMITED
ANNUAL FINANCIAL REPORT
30 JUNE 2007
ABN 40 052 468 569
CORPORATE DIRECTORY
Directors Share Registry
Dr Robert Hawley - Chairman Australia
Mr Matthew Syme - Managing Director Computershare Investor Services Pty Ltd
Dr James Ross Level 2
Senor Jose Ramon Esteruelas 45 St Georges Terrace
Mr Sean James Perth WA 6000
Telephone: +61 8 9323 2000
Company Secretary Facsimile: +61 8 9323 2033
Mr Shane Cranswick
United Kingdom
Registered Office Computershare Investor Services Plc
Level 9, BGC Centre PO Box 82
28 The Esplanade The Pavillions
Perth WA 6000 Bridgwater Road
Australia Bristol BS99 7NH
Telephone: +61 8 9322 6322 Telephone: +44 870 889 3105
Facsimile: +61 8 9322 6558
Stock Exchange Listings
London Office Australia
Office 2.20 Australian Securities Exchange Limited
18 Hanover Square Home Branch - Perth
London W1S 1HX 2 The Esplanade
United Kingdom Perth WA 6000
Telephone: +44 20 3008 4776
Facsimile: +44 20 3008 8601 United Kingdom
London Stock Exchange - AIM
10 Paternoster Square
Auditor London EC4M 7LS
Stantons International
Level 1 ASX/AIM Code
1 Havelock Street BKY - Fully paid ordinary shares
West Perth WA 6005
Bankers
Website Australia and New Zealand Banking Group Ltd
www.berkeleyresources.com.au 77 St Georges Terrace
Perth WA 6000
Email
info@berkeleyresources.com.au
DIRECTORS' REPORT
30 JUNE 2007
The Directors of Berkeley Resources Limited submit their report on the
Consolidated Entity consisting of Berkeley Resources Limited ("Company" or "
Berkeley" or "Parent") and the entities it controlled at the end of, or during,
the year ended 30 June 2007 ("Consolidated Entity" or "Group").
Directors
The names of Directors in office at any time during the financial year or since
the end of the financial year are:
Dr Robert Hawley
Mr Matthew Syme
Dr James Ross
Senor Jose Ramon Esteruelas (appointed 16 November 2006)
Mr Sean James (appointed 28 July 2006)
Mr Ian Middlemas (resigned 16 November 2006)
Unless otherwise disclosed, Directors held their office from 1 July 2006 until
the date of this report.
Current Directors and Officers
Robert Hawley
Non-Executive Chairman
Qualifications - CBE, DSc, FRSE, FREng, Hon FIET, FIMechEng, FInstP
Dr Hawley is based in London and has extensive technical qualifications and
substantial expertise in the nuclear energy industry as well as broader public
company management. He was Chief Executive of British Energy Plc from 1995 to
1997, Chief Executive of Nuclear Electric Plc from 1992 to 1996 and prior to
this enjoyed a long career in senior engineering and management positions with
CA Parsons & Co Ltd, Northern Engineering Industries Plc and Rolls-Royce Plc. Dr
Hawley has been Managing Director of CA Parsons & Co Ltd, Managing Director of
Northern Engineering Industries Plc, a Director of Rolls-Royce Plc, Chairman of
Taylor Woodrow Plc, an Advisor Director of HSBC Bank Plc and is presently a
director of Colt Telecom Group Ltd, Rutland Trust Plc, Carron Acquisition Co Ltd
and Lister Petter Investment Holdings Ltd. He was awarded the CBE in 1997 for
services to the Energy Industry and to Engineering.
Dr Hawley's experience in managing Nuclear Electric Plc, the largest nuclear
generator in the United Kingdom, and British Energy Plc, the United Kingdom's
leading electricity supplier, gives him a unique understanding of the nuclear
generation sector in Europe and he is acknowledged as an international expert on
power generation and energy.
During the three year period to the end of the financial year, Dr Hawley has
held directorships in Rutland Trust Plc (September 2000 - July 2007), Colt
Telecom Group Ltd (August 1998 - present),Carron Acquisition Co Ltd (April 2006
- present) and Lister Petter Investment Holdings Ltd (September 2006 - present).
Dr Hawley was appointed a director of Berkeley Resources Limited on 20 April
2006.
Matthew Syme
Managing Director
Qualifications - B.Com, CA
Mr Syme is a Chartered Accountant and has over 20 years experience as a senior
executive of a number of companies in the Australian resources and media
sectors. He was a Manager in a major international Chartered Accounting firm
before spending 3 years as an equities analyst in a large stockbroking firm. He
was then Chief Financial Officer of Pacmin Mining Limited, a successful
Australian gold mining company, as well as a number of other resources
companies.
Mr Syme was appointed a director of Berkeley Resources Limited on 27 August
2004. Mr Syme has not held any other directorships of listed companies in the
last three years.
DIRECTORS' REPORT (continued)
James Ross
Technical Director
Qualifications - B.Sc. (Hons.), PhD, FAusIMM, FAICD
Dr Ross is a leading international geologist whose technical qualifications
include an honours degree in Geology at UWA and a PhD in Economic Geology from
UC Berkeley. He first worked with Western Mining Corporation Limited for 25
years, where he held senior positions in exploration, mining and research.
Subsequent appointments have been at the level of Executive Director, Managing
Director and Chairman in a number of small listed companies in exploration,
mining, geophysical technologies, renewable energy and timber. His considerable
international experience in exploration and mining includes South America,
Africa, South East Asia and the Western Pacific.
Dr Ross chairs the Boards of two geosciences research centres and two
foundations concerned with geosciences education in Western Australia.
He was appointed a director of Berkeley Resources Limited on 4 February 2005 and
has not been a director of another listed company in the three years prior to
the end of the financial year.
Senor Jose Ramon Esteruelas
Non-Executive Director
Senor Esteruelas is an experienced Spanish executive whose senior executive
roles have included Director General of Correos y Telegrafos (the Spanish postal
service), President of Minas de Almaden y Arrayanes SA (formerly the world's
largest mercury producer) and Chief Executive Officer of Compania Espanola de
Tabaco en Rama S.A., the leading tobacco transforming company in Spain.
Senor Esteruelas was appointed a Director of Berkeley Resources Limited on 16
November 2006. Senor Esteruelas has not held any other directorships of listed
companies in the last three years.
Sean James
Non-Executive Director
Qualifications - B.Sc. (Hons.)
Mr James is a mining engineer and was formerly the Managing Director of the
Rossing Uranium Mine in Namibia which is the world's largest low grade, open pit
uranium mine. After 16 years at Rossing, he returned to London as a Group Mining
Executive at Rio Tinto Plc in London.
Mr James' experience in managing the Rossing mine is ideally suited for the type
of uranium mining operations the Company aims to develop in the Iberian
Peninsula.
Mr James was appointed a Director of Berkeley Resources Limited on 28 July 2006.
Mr James has not held any other directorships of listed companies in the last
three years.
Shane Cranswick
Company Secretary
Qualifications - B.Com, CA, ACIS, SA Fin
Mr Cranswick gained a Bachelor of Commerce degree from the University of Western
Australia and is a member of the Institute of Chartered Accountants, the
Institute of Chartered Secretaries and the Financial Services Institute of
Australasia. He commenced his career with an international Chartered Accounting
firm and has since worked in the role of Company Secretary for a number of
listed companies that operate in the resources sector.
Mr Cranswick was appointed Company Secretary of Berkeley Resources Limited on 30
July 2004.
DIRECTORS' REPORT (continued)
Principal Activities
The principal activities of the Consolidated Entity during the year consisted of
mineral exploration. There was no significant change in the nature of those
activities.
Employees
2007 2006
The number of full time equivalent people employed by the Consolidated
Entity at balance date 20 6
Dividends
No dividends have been declared, provided for or paid in respect of the
financial year ended 30 June 2007 (2006: nil).
Earnings Per Share
2007 2006
Cents Cents
Basic loss per share (7.48) (7.33)
Diluted loss per share (7.48) (7.33)
Corporate Structure
Berkeley Resources Limited is a company limited by shares that is incorporated
and domiciled in Australia. The Company has prepared a consolidated financial
report including the entities it acquired and controlled during the financial
year.
Consolidated Results
2007 2006
$ $
Loss of the Consolidated Entity before income tax expense (7,430,597) (3,741,426)
Income tax expense - -
Net loss (7,430,597) (3,741,426)
Net loss attributable to minority interest 1,116,026 -
Net loss attributable to members of Berkeley Resources Limited (6,314,571) (3,741,426)
Review of Operations AND ACTIVITIES
The net loss of the Consolidated Entity after minority interests for the year
ended 30 June 2007 was $6,314,571 (2006:$3,741,426). Included in this loss was
an amount of $2,357,250 (2006:$1,515,234) representing share based incentive
options and an expense of $845,912 in relation to the acquisition of ENUSA's
exploration database for the Salamanca I project.
During the year the Company continued its focus on developing its uranium
exploration projects in Spain. This included further review of its exploration
databases and the database for the Salamanca I project acquired from the Spanish
national uranium company, ENUSA in October 2006. Drilling commenced in December
2006 at the Salamanca I project with a particular focus on the Retortillo
deposit. At the Caceres III project, the main focus was on the Saguazal prospect
where initial drill testing was completed in the June 2007 quarter.
In April 2007 Berkeley calculated an initial JORC compliant inferred resource
for the Retortillo and Zona 7 uranium deposits totalling 11.9 million pounds of
U3O8 at an average grade of 723ppm. This estimate was based on verification
and re-interpretation of the ENUSA database together with the aid of an eighteen
hole drilling programme completed by Berkeley. Further drilling is currently
under way at and around Retortillo.
DIRECTORS' REPORT (continued)
Berkeley is also currently reviewing other uranium exploration opportunities in
Europe and elsewhere.
The Company sold its Strelley and Kangan North properties in the Pilbara region
of Western Australia for cash and share consideration, resulting in a gain on
sale of $1m.
In December 2006, the Company's securities commenced trading on the Alternative
Investment Market (AIM) of the London Stock Exchange.
Mr Sean James, former Managing Director of the Rossing Uranium Mine in Namibia,
and Senor Jose Ramon Esteruelas, a very experienced Spanish executive, were
appointed to the Board of Directors during the year.
Corporate and Financial Position
The following material corporate events occurred during the year:
* On 28 July 2006, Mr Sean James was appointed as an Executive Director
of the Company (see Current Directors and Officers above for further details).
* On 26 September 2006, the Company announced it was proceeding with the
admission of its ordinary shares to trading the Alternative Investment Market
(AIM) of the London Stock Exchange. The Company's securities commenced trading
on AIM on 6 December 2006;
* On 16 November 2006, Senor Jose Ramon Esteruelas was appointed a
Director of the Company and Mr Ian Middlemas resigned as a Director of the
Company;
* On 29 November 2006 the Company announced the sale of its Strelley and
Kangan North properties in the Pilbara region of Western Australia to Atlas Iron
Limited. In consideration for the sale the Company received $350,000 cash and
1.3 million Atlas Iron Limited ordinary shares then valued at $650,000,
resulting in a gain on sale of $1 million; and
* During the period to 30 November 2006, 12,111,374 Listed Options and
4,850,000 Unlisted Options were exercised which raised approximately $3.4
million. 157,000 Listed Options were not exercised as at the expiry date of 30
November 2006.
* On 10 April 2007, Berkeley announced that the Company had completed an
initial JORC compliant resource estimate for the Retortillo and Zona 7 uranium
deposits totalling 11.9 million pounds of U3O8 at an average grade of 723ppm.
* On 26 April 2007, the Company completed the placement of 12.5 million
shares at a price of $1.85 per share with institutional investors raising
$23.1million before expenses.
* During the financial year Berkeley increased its interest in its main
Spanish operating subsidiary, Minera de Rio Alagon SL (''Rio Alagon''), from 51%
to 77.5%.
Business Strategies and Prospects
The Consolidated Entity currently has the following business strategies and
prospects over the medium to long term:
* To increase its resources at and around Retortillo and commence
pre-feasibility studies;
* Complete the 100% acquisition of the Spanish uranium projects; and
* Continue to examine new opportunities in mineral exploration.
Risk Management
The Board is responsible for the oversight of the Consolidated Entity's risk
management and control framework. Responsibility for control and risk management
is delegated to the appropriate level of management with the Managing Director
having ultimate responsibility to the Board for the risk management and control
framework.
Arrangements put in place by the Board to monitor risk management include
monthly reporting to the Board in respect of operations and the financial
position of the Group.
DIRECTORS' REPORT (continued)
Significant Changes in the State of Affairs
Other than as disclosed below, there were no significant changes in the state of
affairs of the Consolidated Entity during the year.
* In November 2006 the Company disposed of its Strelley and Kangan North
Properties in Western Australia to Atlas Iron Limited. In consideration for the
sale the Company received $350,000 cash and 1.3 million Atlas Iron Limited
ordinary shares valued at $650,000 resulting in a gain of $1 million.
* During the year Berkeley earned a further 22.5% in Rio Alagon to take
its holding to 77.5% at 30 June 2007.
* In April 2007 the Company completed a placement of 12.5 million new
ordinary shares at a price of $1.85 per share, with institutional investors in
Europe, the USA, Canada and Australia. The issue raised $23.1 million before
expenses.
The Company had the following securities on issue at 30 June 2007:
Issued and Paid Up Shares Listed Unlisted Director Director Unlisted
Options - Options - Incentive Incentive Options -
Capital $0.20 $0.20 Options - $1.00 Options - $0.70
$various
Balance at 30 June 2006 71,130,321 12,268,374 4,850,000 - 3,000,000 10,600,000
Share placement 12,500,000 - - - - -
Director Incentive Options
Issue - - - 2,250,000 - -
Exercise of Options 17,961,374 (12,111,374) (4,850,000) - (1,000,000) -
Expiry of Options - (157,000) - - - -
Total at 30 June 2007 101,591,695 - - 2,250,000 2,000,000 10,600,000
Since 30 June 2007 the only movement in securities on issue to 28 September 2007
has been the issue of 2,970,000 employee options exercisable at $1.86 per share
under the Employee Option Scheme on 6 August 2007.
Significant Post Balance Date Events
As at the date of this report there are no matters or circumstances, which have
arisen since 30 June 2007 that have significantly affected or may significantly
affect:
(a) the operations, in financial years subsequent to 30 June
2007, of the Consolidated Entity;
(b) the results of those operations, in financial years
subsequent to 30 June 2007, of the Consolidated Entity; or
(c) the state of affairs, in financial years subsequent to 30
June 2007, of the Consolidated Entity.
Environmental Regulation and Performance
The Consolidated Entity's operations are subject to various environmental laws
and regulations under the relevant government's legislation. Full compliance
with these laws and regulations is regarded as a minimum standard for all
operations to achieve.
Instances of environmental non-compliance by an operation are identified either
by external compliance audits or inspections by relevant government authorities.
There have been no significant known breaches by the Consolidated Entity during
the financial year.
DIRECTORS' REPORT (continued)
Likely Developments and Expected Results
It is the Board's current intention that the Consolidated Entity will continue
with development of its Spanish uranium projects and will seek to complete the
100% acquisition of Rio Alagon.The Company will also continue to examine new
opportunities in mineral exploration, including uranium.
All of these activities are inherently risky and the Board is unable to provide
certainty that any or all of these activities will be able to be achieved. In
the opinion of the Directors, any further disclosure of information regarding
likely developments in the operations of the Consolidated Entity and the
expected results of these operations in subsequent financial years may prejudice
the interests of the Company and accordingly no further information has been
disclosed.
To view the financial tables please view the link below
http://www.rns-pdf.londonstockexchange.com/rns/6024e_-2007-9-27.pdf
This information is provided by RNS
The company news service from the London Stock Exchange
END
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