Griffin Mining Ld - Final Results
15 Juni 2000 - 10:00AM
UK Regulatory
RNS Number:2656M
Griffin Mining Ld
15 June 2000
GRIFFIN MINING LIMITED
PRELIMINARY STATEMENT OF RESULTS
FOR THE YEAR ENDED 31 DECEMBER 1999
INITIAL RESULTS FROM 1999/2000 UNDERGROUND DEVELOPMENT & DRILLING PROGRAMME
GRANT OF NEW EXPLORATION LICENCE OVER 102.2 SQ KM SURROUNDING EXISTING
CAIJAIYING LICENCE AREA
Griffin Mining Limited ("Griffin") has today published its results for the
year ended 31 December 1999.
Craig Niven, Chairman commented on the results, development programme and new
exploration licence as follows.
"The latter half of 1999 and the first half of 2000 has seen Griffin create
real value by developing further the Caijiaying orebody and creating a new
technology company in which Griffin holds a significant equity stake.
The Caijiaying project has been dominated by the underground development
programme which was funded from the proceeds of the fund raising of #1.6
million announced in November 1999. Work on the ground commenced in October
1999 and concluded in May this year. The programme has involved extending an
existing decline located at the southern end of the main ore body and drives
off this decline from which a programme of underground drilling has now been
completed. Analytical work arising from this programme is continuing which
should provide sufficient information for the Board to take decisions which
will determine the future course of action of the company.
In summary, the key conclusions that have emerged from the 1999/2000 work
programme at Caijiaying are as follows:
- The ore body in the southern end of Zone III contains extensive high grade
mineralisation. Composite grades of the wider zones range from 6% to 17% zinc
and of the narrower zones from 20% to 30% zinc.
- The ore body in the southern end of Zone III shows more complex geometry
than earlier drilling results indicated.
- The combination of the high grades and complex geometry together imply that
the most economic mining method for exploitation of the deposit may be by way
of underground mining using the existing decline and at some point in the
light of the orebody structure from a new decline to be sunk on the northern
half of Zone III.
Based on the above conclusions, the Board has taken the decision to
investigate the possibility of commencing zinc and gold production at
Caijiaying. The production decision would be a significant milestone for
Griffin. For a relatively small capital cost it would present the opportunity
for Griffin to generate cash flows in the short term which should end the
company's reliance on the capital markets to fund its ongoing activities.
However, a decision by the Board to move forward with production will be based
on the requisite economic robustness of the project being demonstrated and the
willingness of the capital markets to provide the necessary funding to enable
mining and processing of ore to be undertaken on site at Caijiaying. Should
either of these criteria not be satisfied, then the Board will have no option
but to seek alternative rationalisation strategies for Caijiaying.
On 5th June 2000 Griffin's joint venture company in China, Hebei Hua' Ao
Development Company Limited, was awarded a three year exploration licence
covering 102.2 sq km of highly prospective ground surrounding the existing
exploration licence area at Caijiaying. The geology of the area suggests that
the new licence area has the potential to host significant copper and/or gold
as well as additional zinc and lead.
Agreement in principle has been reached with Griffin's Chinese partners to
amend the existing joint venture agreement such that Griffin will have a 90%
interest in this new licence. The minimum expenditure commitments on the new
area are approximately $226,000 over the first three years of the exploration
licence. The commitments for the first year have already been met as part of
the work conducted in the area during the 1999/2000 development programme at
Caijiaying.
In January 2000 the Board announced another initiative primarily designed to
increase the funding alternatives available to Griffin with the formation of
Griff-Tech.com plc. This company was formed as an AIM listed cash shell with a
strategy of seeking a major acquisition via a reverse take-over. In May 2000,
Griff-Tech announced the acquisition of Future Internet Technologies Limited
and a placing to raise #3 million to fund the development of this company.
Following this acquisition and placing Griffin holds a 2.4% interest in Future
Internet Technologies plc.
Griffin shareholders have benefited in two ways from the Griff-Tech
initiative. First through the structure which offered all founders shares in
Griff-Tech exclusively to Griffin shareholders on a pro rata basis at 1p per
share. Second, through the increase in the value of the interest in Future
Internet Technologies plc that has been retained by Griffin itself. This
initiative was well received by shareholders with a take up of the offer in
excess of 85%.
With Griff-Tech having now completed the type of transaction that it was
created to conclude, the Board is now actively considering similar
initiatives. The year has therefore seen the beginning of an evolution of
Griffin from a single project mining development company into a company which
also has a separate investment activity. Capital market conditions and
developments in the new economy provided the catalyst for this change, but it
was facilitated by the skills and experience of individuals within Griffin. I
view this as a positive way to have started the year 2000."
Further information
Craig Niven (Chairman)
Telephone: + 44 (0)207 321 2077
Charles Dampney - Charles Stanley
Telephone; + 44 (0)1273 486244
Griffin Mining Limited's shares are quoted on the Alternative Investment
Market (AIM) of the London Stock Exchange (symbol GFM) and traded on the
Canadian Dealing Network in Toronto (symbol GRFM).
The Company's news releases are available on the Company's web site:
www.griffinmining.com
GRIFFIN MINING LIMITED
CONSOLIDATED PROFIT AND LOSS ACCOUNT
For the year ended 31 December 1999
(expressed in thousands US dollars)
1999 1998
$000 $000
Income
(Losses) / gains on the disposal of investments (179) 147
Net operating expenses (774) (711)
Provisions in respect of continuing operations (74) (1,976)
Release of negative goodwill - 490
Operating (loss) (1,027) (2,050)
Foreign exchange gains / (losses) 4 (10)
Interest receivable and similar income 17 31
(Loss) on ordinary activities before taxation (1,006) (2,029)
Taxation on ordinary activities - -
(Loss) on ordinary activities after taxation (1,006) (2,029)
Minority interests - 375
(Loss) for the financial year (1,006) (1,654)
(Loss) per share (cents) (4.2) (10.0)
GRIFFIN MINING LIMITED
CONSOLIDATED BALANCE SHEET
As at 31 December 1999
(expressed in thousands US dollars)
1999 1998
$000 $000
Fixed assets
Intangible assets 5,122 4,344
Tangible assets 259 263
5,381 4,607
Current assets
Portfolio investments 82 165
Accounts receivable 10 14
Prepaid expenses 3 11
Cash and deposits 1,501 408
1,596 598
Creditors: Amounts falling due within one year
Accrued expenses (155) (119)
Creditors (364) (85)
Net current assets 1,077 394
Negative goodwill (288) (288)
Total net assets 6,170 4,713
Capital and reserves
Share capital 3,895 2,099
Share premium 13,084 12,587
Investment revaluation reserve (764) (911)
Foreign exchange reserve 266 243
Profit & loss account (10,978) (9,972)
Equity shareholders' funds 5,503 4,046
Equity minority interests 667 667
Equity interests 6,170 4,713
Number of shares in issue 38,946,501 20,993,779
Attributable net asset value per share $0.14 $0.19
GRIFFIN MINING LIMITED
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
For the year ended 31 December 1999
(expressed in thousands US dollars)
1999 1998
$000 $000
(Loss) for the financial year (1,006) (1,654)
Unrealised gains / (losses) on investments 147 (194)
Currency translation differences in
foreign currency net investments 23 72
Total gains and losses recognised in the year (836) (1,776)
Losses and profits for the financial year are the same as those on an
historical cost basis.
GRIFFIN MINING LIMITED
CASH FLOW STATEMENT
For the year ended 31 December 1999
(expressed in thousands US dollars)
1999 1998
$000 $000
Net cash (outflow) from operating activities (381) (246)
Investing activities
Payments to acquire intangible fixed assets (819) (1,093)
Payments to acquire tangible fixed assets - (7)
Payments to acquire subsidiary undertakings - (14)
Net cash (outflow) from investing activities (819) (1,114)
Net cash (outflow) before financing (1,200) (1,360)
Financing
Issue of ordinary share capital 2,774 1,728
Expenses paid in connection with share issue (481) (362)
2,293 1,366
Increase in cash and cash equivalents 1,093 (6)
Reconciliation of operating (loss) to net cash (outflow) from operating
activities
Operating (loss) (1,027) (2,050)
Interest received 17 31
Taxation - -
Depreciation 4 4
(Losses) / Gains on sale of investments 179 (147)
Receipts on the sale of investments 51 230
Provisions in respect of continuing operations 74 1,976
Release of negative goodwill - (490)
Decrease / (increase) in debtors 12 155
Increase/(decrease) in creditors 287 57
Other non-cash income, including exchange differences 22 (12)
(381) (246)
Notes:
1. This statement has been prepared using accounting policies and presentation
consistent with those applied in the preparation of the statutory accounts of
the Company.
2. The summary accounts set out above do not constitute statutory accounts as
defined by Section 84 of the Bermuda Companies Act 1981 or Section 240 of the
UK Companies Act 1985. The summarised balance sheet at 31 December 1999 and
the summarised profit and loss account, summarised cash flow statement and
summarised statement of total recognised gains and losses for the year then
ended have been extracted from the Group's 1999 statutory financial statements
upon which the auditors' opinion is unqualified. The results for the year
ended 31 December 1998 have been extracted from the statutory accounts for
that period which contain an unqualified auditor's report.
3. The annual report and accounts for 1999 will be sent by post to all
registered shareholders shortly. Additional copies are available from the
Company's London office, 5th Floor, 4 New Burlington Street, London. W1X 7FE.
4. Losses per share have been calculated on the basis of the net loss after
taxation of US$1,006,000 (loss US$1,654,000 in 1998) and the weighted average
number of shares in issue in the year ended 31 December 1999 of 24,200,537
(16,457,940 in 1998). There is no dilutive effect of outstanding warrants to
purchase 1,957,050 shares at 9 pence and share purchase options to purchase
2,475,000 shares at $0.24 because the exercise prices of the warrants and
share purchase options were greater than the weighted average market price of
the Company's ordinary shares in the year.
5. Reconciliation of shareholders' funds
1999 1998
$000 $000
Total gains and (losses) recognised in the year (836) (1,776)
Issue of ordinary shares in the year 2,293 2,991
Shares to be issued - (780)
Net additions to shareholders' funds 1,457 435
Opening shareholders' funds 4,046 3,611
Closing shareholders' funds 5,503 4,046
END
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