TIDMCRHL
RNS Number : 4941Z
Creat Resources Holdings Ltd
16 March 2012
16 March 2012
Creat Resources Holdings Limited
("CRHL" or the "Company")
Interim results for the six months ended 31 December 2011
Creat Resources Holdings Limited (AIM: CRHL), the exploration
and development company with assets in western Tasmania, Australia,
announces its auditor reviewed interim results for the six months
ended 31 December 2011. All amounts are presented in Australian
dollars, unless otherwise stated and should be read in conjunction
with the 2011 Annual Report.
Highlights:
-- Loss for the period of $1.1m (H1 2010: Loss $15.9m)
-- Finance costs $4.4m (H1 2010: $3.1m)
-- Outstanding loans and convertible notes $37.4m (H1 2010:
36.5m)
-- Continues its exploration programme for 23 drilling holes
under the existing exploration and retention licenses to further
test and locate potential mineralisation zones and extend or
quantify known resources
-- Galaxy Resources Ltd's ("Galaxy") wholly-owned Jiangsu
lithium carbonate plant in China was officially opened as the
largest capacity battery grade lithium carbonate plant in Asia
Pacific on 7 March 2012. The plant has completed its cold
commissioning, and its hot commissioning is currently underway with
the first production on track for the current quarter
-- Discussions towards potential joint ventures regarding the
Razorback Project (EL21/2004)
Management Comment and Outlook
Dr Zheng Yuewen, Executive Chairman & CEO, commented:
"The exploration results in 2011 bolstered our confidence about
prospects of commercial value in the region. Entering into 2012, we
are committed to continue delivering our exploration programme and
at the same time, pursue exciting new joint venture opportunities
with a number of leading mining companies. It has always been our
goal to develop the exploration programmes in the Western Tasmania
in a highly efficient and environmental friendly manner. To this
end, we have been working closely with the Mineral Resources
Tasmania ("MRT") with regards to our renewal of licences and
recently strengthened our management team with the appointment of a
number of experienced professionals. We are also pleased to have
Creat Group's commitment to assist us in achieving our working
capital forecast through to 31 March 2013.
As a part of our dual strategy, weare also pleased to see that
in the last two years, our key strategic investment, Galaxy, has
progressed steadily from a green field site to its completion of
construction at both Mt. Cattlin and Zhangjiagang. Galaxy, which
has a vertically integrated plan to service the increasing global
demand for clean energy power sources, now owns the second largest
hard rock lithium mine in the world and the largest battery grade
lithium carbonate capacity in Asia Pacific. Theseremarkable
achievements are evidence of Galaxy moving to a new period of
growth and development."
For further information please visit www.creatresources.com or
contact:
Creat Resources Holdings Limited Tel: +61 3 6216 2700
Allan Branch
Company Secretary, General Manager
Evolution Securities Limited (Nominated Tel: +44 20 7071
Adviser) 4300
Evolution Securities China Limited
(Broker)
Tim Worlledge
Esther Lee
About Creat Resources Holdings Limited
CRHL is an early stage mining exploration company holding 4
Exploration Licences and 3 Retention Licences covering 109 square
kilometres around the mineral rich Zeehan area in western Tasmania.
CRHL also has a strategy of acquiring assets in interesting
resources companies that complement or supplement the Company's
exploration activities. CRHL is a major shareholder of Galaxy with
an interest of 11.78% shareholding. Galaxy is an Australian-based
integrated lithium mining, chemicals and battery company listed on
the Australian Securities Exchange (Code: GXY) and is a S&P/ASX
300 Index Company. Galaxy plans to be one of the world's largest
lithium carbonate producers and is positioning itself to be
involved in every step of the lithium supply chain.
Operating Results
The consolidated loss of the Company for the half-year after
providing for income tax amounted to $1,135,441 (2010 loss:
$15,947,580). This significant improvement is attributed to
accounting for the gain of $5,861,987 on the Convertible Note
options, (2010: loss of $9,545,126) and the significant change in
the foreign exchange movement, with a loss of $119,837 for the six
months ended 31 December 2011 (2010: gain of $4,033,335) (refer
note 3 to the financial statements). The Company's share of Loss of
Associate is nil in 2011 due to the cessation of equity accounting
upon the loss of significant influence over Galaxy Resources
Limited effective 28 February 2011 (2010: share of loss of
$3,953,688). Details of the Creat Group loans appear in the Going
Concern statement below.
Review of Operations
Galaxy Resources Limited, Investment Asset
Galaxy's Mt Cattlin Mine in Western Australia.
Galaxy Resources Limited ("Galaxy") is a Western Australian
S&P / ASX 300 Index company which plans to become one of the
world's leading producers of lithium compounds - the essential
components of rechargeable batteries for powering manufactured
products like the world's fast expanding fleet of hybrid and
electric cars. In 2011, Galaxy's Mt Cattlin mine plans to be the
world's second largest producer of lithium mineral concentrate
globally, and through the development of its 17,000 tpa lithium
carbonate plant in Jiangsu province, Galaxy expects to be one of
the largest t lithium compound producers in China. Lithium
compounds such as lithium carbonate are forecast to be in short
supply against high future demand due to advances in long life
batteries and their use in sophisticated electronics including
mobile phones and computers. Galaxy has positioned itself to meet
this lithium demand through vertical integration, by not only
mining the lithium, but also by downstream processing to supply
lithium carbonate to the expanding Asian market. Galaxy is also
positioning itself for growth via mergers and acquisitions.
The Company's shareholding in Galaxy at the start of the
half-year was 38,091,616 shares or 11.78% of issued shares. There
has been no change in the number of shares held by the Company
during the reporting period, and CRHL retains 2 director positions
on Galaxy's board.
The market value of the Company's investment in Galaxy has
dropped during the half-year. The fair value for the investment in
Galaxy Resources Limited based on the Australian Stock Exchange
share price at 31 December 2011 is $26,854,589 (30 June 2011:
$28,568,712).
Galaxy's Jiangsu Lithium Carbonate Project in Jiangsu, PRC.
Galaxy Jiangsu is 100% owned by Galaxy and is intended to
provide lithium to the China market as well as internationally to
address the increasing demand for green energy. The Jiangsu plant
has completed its commissioning and Galaxy has announced that the
official opening ceremony, to be held on March 7, 2012, will be a
milestone for the critical expansion in supply of lithium
carbonate.
James Bay Project.
While Galaxy continues to undertake a feasibility study on its
20% owned James Bay Spodumeme Project in Quebec, Canada, it
successfully completed the collection of a 10 tonne bulk sample of
pegmatite ore, and has a farm-in arrangement with Canada's Lithium
One Inc., (TSX-VLI) to increase its stake up to 70% of the James
Bay Project.
Mineral Assets, Zeehan, Western Tasmania
Exploration Activities
Retention Licences
Creat Resources Holdings Limited ("CRHL") holds three (3)
Retention Licences (RL's) situated in the mineral rich area around
Zeehan in western Tasmania. New drilling programs have been
developed and partly implemented for all three licences over the
reporting period. RL1/2008, (Mariposa), which is not due for
renewal until 1 February 2013, has had several geological ground
surveys implemented ahead of additional exploration this year.
RL3/2009, (Oceana), has been active with a review of geological
data and resampling of previously drilled diamond drill holes,
while RL4/2009, (Comstock), has a potential new drilling program in
development linked to EL30 exploration, in conjunction with the
continuing Comstock rehabilitation.
Mariposa
Other than geological ground surveys, there has been no
development activity in the 6 months to 31 December 2011. Retention
Licence RL1/2008 was renewed in February 2011 for a further period
of 2 years, with the term of the licence extending until 1st
February 2013.
Oceana
RL3/2009 Oceana was granted on 01/02/2010 for an initial period
of 2 years. The licence has been renewed until 1/2/2014 subsequent
to the end of this reporting period. The assays for approximately
300 samples drilled in 2008 and earlier from Oceana deposit have
recently been received from Burnie Laboratories, Tasmania and are
being analysed and added to our resource modelling. The assay
results have filled gaps in the Company drill hole database, and
will be used to confirm and potentially upgrade the JORC Resources
at Oceana deposit, Zeehan Project, Western Tasmania.
Comstock
RL4/2009 Comstock was granted on 01/02/2010 for an initial
period of 2 years. This licence has also been renewed for a period
of 2 years subsequent to the end of this reporting period.
Mineral Resources Tasmania (MRT) has for several years held an
environmental bond of $2.5 million from CRHL to cover the
decommissioning and rehabilitation of the Comstock site. CRHL will
be reimbursed the full bond amount upon successful completion of
decommissioning and rehabilitation.
A draft Decommissioning and Rehabilitation Plan (DRP) was
developed by CRHL and was submitted to the Environment Protection
Authority (EPA) for review on 24 February 2012. CRHL have proposed
that The DRP be divided into 2 phases. The first phase will
rehabilitate the main problem areas at Comstock Mine, whilst
leaving key infrastructure in place. The second phase includes
removal of all site infrastructure, and total rehabilitation of the
remaining disturbed areas. This separation of the works is to
facilitate potential resumption of mining or exploration
activities.
CRHL have invested in environmental work on RL 4/2009 to ensure
the company's compliance and policy of being environmentally
sensitive. A lime dosing station was installed in January 2011 to
improve the quality of water being discharged into the environment
from Comstock Mine and this has recently been improved to increase
efficiency and reduce lime costs. Earthworks have occurred across
the site to reduce the acid generating potential of the waste rock.
This has included profiling and compaction of the main waste rock
dump and removal and burial of many smaller waste rock stockpiles.
Several disturbed areas around the site have also been
rehabilitated and reseeded with native plant species.
Upcoming environmental work on RL 4/2009 includes the
development of a clay quarry to avoid purchasing clay off-site.
This will be used to further reduce acid generating potential of
the site by covering larger waste rock dumps with a thick layer of
clay. The clay capping will also reduce the amount of lime dosing
required to treat discharge water from the site.
The assays for approximately 700 samples drilled in 2008 and
earlier from Comstock deposit were recently received from Burnie
Laboratories, Tasmania. The assay results have filled gaps in the
Company drill hole database, and will be used to confirm and
potentially upgrade the JORC Resources at Comstock deposit, Zeehan
Project, Western Tasmania.
Exploration Licences
CRHL holds four (4) Exploration Licences (EL's) in the Zeehan
area covering a total area of 109 square kilometres. During the
last 6 months, the focus has been on strategic exploration
including several new key drill holes and soil sampling which have
then been part of the development for a comprehensive drilling
program to be continued in the coming year. The first assay results
showing lead-zinc deposits were announced to the market on 15 March
2012 and have been posted on the Company's website.
During the planning activities, EL21/2004, (Razorback Project),
which is not due for renewal until 25 June 2012, has been the
subject of two potential JV discussions.
EL18/2003
A helicopter-supported diamond drill hole, TINDH01 was completed
in EL18 to a total depth of 275.9m, adjacent to the recently
completed Tenth Legion drilling program. The hole was collared in
sandstones and siltstones of the Precambrian Oonah formation, and
was completed within the Devonian Heemskirk Granite. Disseminated
chalcopyrite and pyrite mineralisation at uneconomic grades was
encountered at various depths within the sediments, and also within
granite near the contact margins.
A geochemical grid comprising approximating 12 line-km has been
cut in the northern part (of the southern block) of EL18. Possible
extensions of the Avebury Nickel Mine host horizon within EL18 are
targeted, mapping and rock-chip sampling has been completed.
During the reporting period there have been 3 soil sampling
programs and 1 diamond drill hole on EL18, plus one additional
diamond drill hole subsequent to the reporting period.
EL20/2002
Recently a diamond drill hole at Austral Prospect was drilled to
a total depth of 344 metres within the Gordon Limestone near the
Oceana Deposit. This drill hole was targeted on lead-zinc
mineralisation and was aimed at following-up promising historical
drilling results by previous explorers. The hole intersected a
sideritic grey dolomitised argillaceous limestone containing
disseminated and vein galena and sphalerite. Assays confirmed the
existence of a broad zone of low-grade lead mineralisation. During
the reporting period there have been two new diamond drill holes
completed on EL 20.
EL21/2004
No drilling was completed during the reporting period. EL21/2004
includes known tin mineralisation at the historic Razorback and
Grand Prize Tin mines. The licence is considered prospective for
tin skarn mineralisation of the Renison Bell type, and the
serpentinite units prospective for Avebury-Style nickel
mineralisation.
The concentration for exploration on EL21 Razorback has been the
entering of historic drillhole data centred around the historic tin
workings into the company's database, and the planning of two
diamond drill holes to be submitted for Mineral Resources Tasmania
(MRT) environmental approval.
Activity on EL21 is currently focussed on two potential joint
venture negotiations.
EL30/2002
The primary focus at EL30/2002 Tenth Legion Prospect during the
period was to evaluate the extent and quality of the long-known
magnetite mineralisation present to determine the suitability as a
Direct Shipping Ore (DSO).
The diamond drilling program has been completed at Tenth Legion,
comprising a total of 26 diamond drill holes for 5100 metres.
Significant mineralisation intersections were found in the latest
group of 13 drill holes.
The Table below contains drill collar and orientation data for
all 26 drill holes. A 3D section review of the drilling on the
deposit has indicated the current likely dimensions of the northern
body of magnetite mineralisation to be a strike length of 700-800
m, with a width of 20-40m and an interpreted down dip extent of
180m.
Assay results received so far indicate higher than expected
levels of zinc, present as sphalerite (holes TLC30, TLC31, TLC33,
TLC35, TLC36 and TLC37), but lower levels of tin and tungsten
within the magnetite generally. The zinc mineralisation, where
present, has generally been focussed towards the footwall of the
magnetite zones.
The results from drill hole TLC33, with zinc and iron
intercepts, has allowed further correlations to be made with
previous CRHL drill holes TLC35 and TLC36. The TLC33 result
effectively increases the strike length of the south Tenth Legion
magnetite-zinc exploration target to at least 400m, with the
prospective, largely undrilled magnetite lithology continuing to
the south-west.
In order to establish a magnetite resource it is necessary to
analyse for magnetite which is planned for next year using the
Davis Tube Recovery (DTR) analytical method and using 2m composites
taken from the drill core. A determination of the optimum
grind-size for the DTR testing will also be undertaken. A decision
will then be made as to what the end product will be: iron
feedstock for smelting, or a dense medium separator in the coal
washing business.
Twenty diamond drill holes will be summarised for the purposes
of this report (table 3). These complete our drilling commitment
for the reporting year. Two holes still await assays at the time of
writing. Several other holes have been planned and permitted and
may be drilled next year depending upon analysis of current work
once assessed.
Collar details for EL30/2002 drill holes
Drill hole Easting Northing RL Az. (Mag) Dip Length Drill hole status Logged Assays
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC18 355320 5361492 248 177 -60 280.50 26/11/10 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC20 355171 5361478 250 177 -50 217.50 11/01/11 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC25 356338 5360934 358 193 -55 205.50 02/12/10 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC26 355300 5360335 236 0 -90 168.20 13/05/11 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC27 355561 5361452 265 177 -60 188.0 18/04/11 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC28 355124 5360111 239 340 -45 117.0 24/01/11 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC30 355384 5361422 250 177 -45 180.20 16/12/10 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC31 355499 5361358 260 177 -45 166.50 11/01/11 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC32 355381 5361440 250 177 -75 198.20 24/01/11 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC33 355027 5360192 230 170 -60 190.20 02/02/11 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC34 355416 5360740 288 267 -45 150.80 10/02/11 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC35 355346 5360385 238 140 -55 241.30 26/02/11 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC36 355338 5360287 240 0 -90 234.40 02/03/11 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC37 355467 5361422 249 177 -80 248.80 24/03/11 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC38 355467 5361422 250 177 -65 193.20 15/02/11 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC39 355310 5361308 271 0 -90 63.80 25/04/11 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
TLC40 355296 5361358 267 0 -90 121.50 18/01/11 Yes Yes
TLC42 355148 5361597 260 225 -45 162.80 24/12/10 Yes Yes
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
SY159 359008 5360418 293 205 -50 213.60 16/11/11 Yes No
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
SY160 359235 5360354 288 205 -50 244.6 08/12/11 Yes No
------------ -------- --------- ---- ---------- ---- ------- ------------------ ------- -------
Events Subsequent to Balance Date
DRP submission
The Company submitted a final draft of its Decommissioning and
Rehabilitation Plan (DRP) to the Tasmanian Mineral Authority (MRT)
in 24 February 2012 and that document is currently under review and
assessment by the MRT. A short term provision of $770,175 for the
rehabilitation works has been reflected in the Company's Balance
sheet.
Jiangsu plant
On 24 February 2012 Galaxy announced that the cold commissioning
of its wholly-owned Jiangsu Lithium Carbonate Plant in China had
been completed in mid-February and that its hot commissioning was
underway on schedule. Galaxy held its official opening ceremony of
the Jiangsu Lithium Carbonate Plant on 7 March 2012.
Renewal and Status of Retention and Exploration Licences
Renewal applications were submitted to Mineral Resources
Tasmania (MRT) in February 2012 for EL30/2002, EL20/2002, RL3/2009,
RL4/2009 and EL18/2003. Licences remain in force pending renewal
confirmation. The table below summarises the status of the licences
during and subsequent to the reporting period.
CRHL Tenement Schedule - Licences Status Pending and Renewal
Tenement Locality/Name Area Renewal Renewal Expiry Date
Status Date
-------------------- -------------------- -------- ----------- ----------- ------------
Exploration Licence Zeehan (Tenth 14 sq Pending 10/02/2011 10/2/2013
EL18/2003 Legion) km renewal
with bond
increase
-------------------- -------------------- -------- ----------- ----------- ------------
Exploration Licence Zeehan (Austral, 68 sq Renewed 29/02/2012 31/01/2013
EL20/2002 Oceana, Mariposa) km
-------------------- -------------------- -------- ----------- ----------- ------------
Exploration Licence Zeehan (Razorback) 13 sq Current 25/06/2012 25/06/2012
EL21/2004 km
-------------------- -------------------- -------- ----------- ----------- ------------
Exploration Licence Zeehan (Tenth 8 sq km renewed 29/02/2012 31/1/2013
EL30/2002 Legion, Comstock,
West Comstock)
-------------------- -------------------- -------- ----------- ----------- ------------
Retention Licence Mariposa Creek 3 sq km Current 01/02/2011 01/02/2013
RL1/2008 (6km SE of Zeehan)
-------------------- -------------------- -------- ----------- ----------- ------------
Retention Licence Oceana 1 sq km Renewed 20/02/2012 01/02/2014
RL3/2009
-------------------- -------------------- -------- ----------- ----------- ------------
Retention Licence Comstock 3 sq km Renewed 20/02/2012 01/02/2014
RL4/2009
-------------------- -------------------- -------- ----------- ----------- ------------
Consolidated
Half-year Ended
----- ---------------------------
Note 31 Dec 2011 31 Dec 2010
----- ------------ -------------
$ $
Continuing Operations
Revenue 112,743 98,165
Other Gains and Losses 3 5,736,910 (5,511,791)
Exploration and Evaluation Costs
Expensed (290,787) (609,446)
Depreciation Expense (137,944) (155,640)
Finance Costs (4,435,966) (3,150,237)
Administration Expenses (432,154) (294,344)
Loss on Disposal of Assets 30,569 (373)
Employee Expenses (887,665) (1,405,449)
Site Operations (746,773) (858,440)
Other Expenses (84,374) (107,337)
Share of Loss of Associate - (3,952,688)
Loss before Tax (1,135,441) (15,947,580)
Income Tax Benefit - -
Loss for the Period (1,135,441) (15,947,580)
============ =============
Other Comprehensive Income
Share of other comprehensive income
of associate - 742,006
Reserve - AFS Investment (1,714,123) -
Other Comprehensive Income for
the Period
(net of tax) (1,714,123) 742,006
------------ -------------
Total Comprehensive Loss for the
Period (2,849,564) (15,205,574)
============ =============
Earnings Per Share
Basic (cents per share) (0.17) (2.39)
Diluted (cents per share) (0.17) (2.39)
The accompanying notes form part of these condensed consolidated
financial statements which must also be read in conjunction
with the 2011 Annual Report.
Consolidated
------ ---------------------------
Note 31 Dec 2011 30 June 2011
------ ------------ -------------
$ $
Assets
Current Assets
Cash and Cash Equivalents 185,616 263,714
Trade and Other Receivables 24,361 28,043
Other Current Assets 144,630 126,542
------------ -------------
Total Current Assets 354,607 418,299
------------ -------------
Non-Current Assets
Property, Plant and Equipment 982,909 1,164,990
Exploration and Evaluation Asset 250,000 250,000
Other Financial Assets 29,354,589 31,068,712
------------ -------------
Total Non-Current Assets 30,587,498 32,483,702
------------ -------------
Total Assets 30,942,105 32,902,001
------------ -------------
Liabilities
Current Liabilities
Trade and Other Payables 301,993 435,458
Financial Liabilities 4 33,280,455 32,533,017
Provisions 770,175 1,450,954
Total Current Liabilities 34,352,623 34,419,429
------------ -------------
Non-Current Liabilities
Financial Liabilities 4 4,240,535 4,225,628
Provisions 2,257,942 1,316,375
------------ -------------
Total Non-Current Liabilities 6,498,477 5,542,003
------------ -------------
Total Liabilities 40,851,100 39,961,432
------------ -------------
Net Liabilities (9,908,995) (7,059,431)
============ =============
Equity
Issued Capital 69,408,416 69,408,416
Reserves (1,369,592) 344,531
Accumulated Losses (77,947,819) (76,812,378)
------------------- -------------------
Total Deficit (9,908,995) (7,059,431)
=================== ===================
The accompanying notes form part of these condensed consolidated
financial statements which must also be read in conjunction with
the 2011 Annual Report.
Issued Retained Share Other Total
Capital Earnings of Associate's Reserves
Reserve
----------- ------------- ---------------- ------------ -------------
$ $ $ $ $
Balance at 1 July
2009 69,408,416 (56,373,289) 462,415 344,531 13,842,073
Loss for the Period - (15,947,580) - - (15,947,580)
Total comprehensive
income for the period - (15,947,580) - - (15,947,580)
Share of Associate's
Reserves - - 742,006 - 742,006
Balance at 31 December (1,363
2010 69,408,416 (72,320,869) 1,204,421 344,531 ,501)
=========== ============= ================ ============ =============
Balance at 1 July
2011 69,408,416 (76,812,378) - 344,531 (7,059,431)
Loss for the Period - (1,135,441) - - (1,135,441)
----------- ------------- ---------------- ------------ -------------
Total comprehensive
income for the period - (1,135,441) - - (1,135,441)
Reserve - AFS Investment - - (1,714,123) (1,714,123)
Balance at 31 December
2011 69,408,416 (77,947,819) - (1,369,592) (9,908,995)
=========== ============= ================ ============ =============
The accompanying notes form part of these condensed consolidated
financial statements which must also be read in conjunction with
the 2011 Annual Report.
Consolidated
Half-year Ended
31 Dec 2011 31 Dec 2010
------------ ------------
$ $
Cash Flows from Operating Activities
Receipts from Customers 39,464 274,307
Payments to Suppliers and Employees (2,559,700) (2,666,577)
Net Cash used in Operating Activities (2,520,236) (2,392,270)
============ ============
Cash Flows from Investing Activities
Purchase of Property, Plant & Equipment (5,294) (18,013)
Proceeds from the sale of Property, Plant
& Equipment 80,000 -
Interest Received 76,961 136,192
Net Cash (used in) / provided by Investment
Activities 151,667 118,179
============ ============
Cash Flows from Financing Activities
Interest Paid (9,529) (20,518)
Proceeds from Borrowings 2,300,000 -
Repayment of Borrowings - (261,124)
Net Cash (used in) / provided by Financing
Activities 2,290,471 (281,642)
============ ============
Net (decrease) / increase in Cash and
Cash Equivalents (78,098) (2,555,733)
Cash and Cash Equivalents at Beginning
of the Half-Year 263,714 2,997,107
Cash and Cash Equivalents at the End of
the Half-Year 185,616 441,374
============ ============
The accompanying notes form part of these condensed consolidated
financial statements which must also be read in conjunction with
the 2011 Annual Report.
Note 1: Significant Accounting Policies
Statement of Compliance
The half-year financial report is a general purpose financial
report prepared in accordance with the Corporations Act 2001 and
AASB 134 Interim Financial Reporting. Compliance with AASB 134
ensures compliance with International Financial Reporting Standard
IAS 34 Interim Financial Reporting. The half-year report does not
include notes of the type normally included in an annual financial
report and shall be read in conjunction with the most recent annual
financial report and the public announcements made during the
half-year in accordance with the continuous disclosure requirements
of the Corporations Act 2001.
Basis of Preparation
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, unless otherwise noted.
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 2011 annual
financial report for the financial year ended 30 June 2011, except
for the impact of the Standards and Interpretations described
below. These accounting policies are consistent with Australian
Accounting Standards and with International Financial Reporting
Standards.
New and revised Standards
The Company has adopted all of the new and revised Standards and
Interpretations issued by the Australian Accounting Standards Board
(the AASB) that are relevant to their operations and effective for
the current reporting period.
New and revised Standards and Interpretations effective for the
current reporting period that are relevant to the Company
include:
-- AASB 2010-3 Amendments to Australian Accounting Standards
arising from the Annual Improvements Project.
-- AASB 2010-4 Further Amendments to Australian Accounting
Standards arising from the Annual Improvements Project
-- AASB 2010-5 Amendments to Australian Accounting Standards
-- AASB 124 Related Party Disclosures (2009), AASB 2009-12
Amendments to Australian Accounting Standards
-- AASB 2009-10 Amendments to Australian Accounting Standards -
Classification of Rights Issues
-- AASB 2009-14 Amendments to Australian Interpretation -
Prepayments of a Minimum Funding Requirement
-- Interpretation 19 Extinguishing Liabilities with Equity Instruments
The adoption of these amendments has not resulted in any changes
to the Company's accounting policies and has no effect on the
amounts reported for the current or prior periods.
Going Concern
The financial report has been prepared on the going concern
basis, which assumes continuity of normal business activities and
the realisation of assets and the settlement of liabilities in the
ordinary course of business.
The consolidated entity is in a development stage and in the
course of its activities has sustained operating losses. It expects
such losses to continue for at least the next 12 months. The
consolidated entity will finance its operations primarily through
cash and cash equivalents on hand, future financing from the
issuance of debt or equity instruments and through the generation
of revenues once commercial operations get underway. However, the
consolidated entity has yet to generate any significant revenues
and has no assurance of future revenues.
The following plan is in place by Management to support the
going concern basis of the consolidated entity.
On 13 March 2012 the Company received an undertaking from Creat
Group in that, for the purpose of assisting CRHL to achieve its
working capital forecast through to 31 March 2013, Creat Group
undertakes to:
-- continue to provide further funding to CRHL as required with
interest rates based on market interest rates; and
-- not call for or cause repayment of any loans or convertible
notes, including the following loans and convertible notes:
-- All convertible notes on issue and held by Creat Group at 31
December 2011;
-- The GBP500,000 loan, interest rate 10%, entered into in
September 2009 and currently due for repayment;
-- The GBP1,200,000 loan, interest rate 0%, entered into in
January 2011 and currently due for repayment;
-- The A$2,000,000 loan, interest rate 10%, entered into in
April 2011 and fully payable 12 months from drawdown;
-- The A$1,000,000 loan, interest rate 12%, entered into in
August 2011 and currently due for repayment;
-- The A$1,000,000 cash advance provided to CRHL in September
2011; and
-- The A$1,000,000 cash advance facility available to CRHL, of
which A$300,000 was drawn down in December 2011.
The total amount outstanding at 31 December 2011 relating to the
above convertible notes and loans including accrued interest is
$37,492,663.
At the date of this report and having considered the above
factors, the directors are confident that the consolidated entity
will be able to continue as a going concern.
Note 2: Segment Information
AASB 8 requires operating segments to be identified on the basis
of internal reports about components of the Company that are
regularly reviewed by the chief operating decision maker in order
to allocate resources to the segment and to assess its
performance.
Creat Resources Holdings Limited reports only one reportable
segment under AASB 8 being mineral exploration.
Note 3: Disclosure of additional information
Other gains and losses
31 Dec 2011 31 Dec 2010
$ $
Foreign exchange (loss)/gain
arising on translation of financial
liabilities (119,837) 4,033,335
Gain/(Loss) on convertible note
option valuation 5,861,987 (9,545,126)
Total other income 5,742,150 (5,511,791)
------------ ------------
Available for sale Investment carried at fair value
The fair value of the investment in Galaxy Resources Limited at
31 December 2011 is $26,854,589 (30 June 2011; $28,568,712).
Provision for Restoration and Rehabilitation
In accordance with State Government legislative requirements, a
provision for rehabilitation of the Comstock mine site has been
recognised. Management has revised the estimate of time to complete
the rehabilitation and now envisage the majority of rehabilitation
will be completed within the next 46 months.
Note 4: Financial liabilities
Financial liabilities include the following loans and
convertible notes:
31 Dec 2011 30 Jun 2011
$ $
Current
Unsecured convertible notes
(i) 26,087,635 27,625,363
Unsecured loans from related
party (ii) 7,164,493 4,662,843
Loan insurance 28,327 -
Withholding tax payable - 244,811
------------ ------------
33,280,455 32,533,017
============ ============
Non-Current
------------ ------------
Unsecured convertible notes
(iii) 4,240,535 4,225,628
============ ============
The following loans and convertible notes are all held with the
ultimate parent entity, Creat Group.
(i) One unsecured convertible note matured on 31 December 2011,
and one unsecured convertible note is due to mature in April 2012.
These two convertible notes have an interest rate of 10%.
(ii) Three unsecured loans from a related party are currently
due for repayment and one unsecured loan will fall due for
repayment in April 2012. One of these unsecured loans has an
interest rate of 0%, two have an interest rate of 10% and one has
an interest rate of 12%. Two cash advance facilities are in place
and have an interest rate of 0%. At 31 December 2011 $700,000 of a
$1,000,000 facility was still available to the company. Subsequent
to this date, a further $300,000 has been drawn down.
(iii) Six unsecured convertible notes are due to mature in
February 2013 and have interest rates of 6%.
The above unsecured convertible notes and unsecured loans are
covered by a letter of financial support from Creat Group (refer
Note 1).
The movement in non-current financial liabilities is
predominantly due to movement in the fair value of convertible
notes.
Note 5: Contingencies and commitments
There are no known contingent liabilities or contingent assets
since the end of the last annual reporting period.
Note 6: Subsequent events
DRP submission
The Company submitted a final draft of its Decommissioning and
rehabilitation Plan (DRP) to the Tasmanian Mineral Authority (MRT)
in 24 February 2012 and that document is currently under review and
assessment by the MRT. Short term provision of $770,175 for the
rehabilitation works is in the Company's Balance sheet.
Jiangsu plant
On 24 February 2012 Galaxy announced that the cold-commissioning
of its wholly-owned Jiangsu Lithium Carbonate Plant in China had
been completed in mid-February and that its hot-commissioning was
underway on schedule. Galaxy held its official opening ceremony of
the Jiangsu Lithium Carbonate Plant on 7 March 2012.
Shareholding changes
Steve Powell, non-executive director, sold 200,000, shares in
CRHL for private reasons on 7 February 2012. His shareholding has
reduced from 300,000 to 160,000 representing approximately 0.024%
of the total voting rights.
Renewal and Status of Retention and Exploration Licences
Renewal applications were submitted to Mineral Resources
Tasmania (MRT) in February 2012 for EL30/2002, EL20/2002, RL3/2009,
RL4/2009 and EL18/2003. Licences remain in force pending renewal
confirmation.
There has been no other event after balance sheet date that
could have a material effect on the company's operations.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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