TIDMAGLD
RNS Number : 1707B
Allied Gold Limited
14 February 2011
FOR IMMEDIATE RELEASE 14 February 2011
allied gold limited
("the Company")
TSX Quarterly Report and management Discussion and Analysis 31
december 2010
Allied Gold lodged its Quarterly Report and Management
Discussion and with the TSX today for the period ended 31 December
2010. Extracts are as follows:
HIGHLIGHTS - THREE MONTHS ENDED DECEMBER 31, 2010
-- Simberi (PNG) - Simberi produced 18,921 ounces for the
quarter at a total cash cost including royalties of US$652/oz. Mill
throughput is running at a consistent 2.4 Mtpa and recoveries were
at 88.5% for the quarter and 89.9% for the December half. During
2011 the Simberi plant will be expanded towards 3.5 Mtpa as part of
an approved A$32million budget to lift output to 100kozpa. Allied
continues to review the options for a further incremental expansion
to process 5 Mtpa of oxide ore. A bankable feasibility study (BFS)
on a 2.5 Mtpa roaster circuit to process Simberi's sulphide ores is
due at the end of 2011.
-- Gold Ridge (Solomon Islands) - The A$150m 120,000ozpa
fully-funded redevelopment is on time and on budget. Committed and
incurred expenditure on the project is at 85% and the remaining
A$20 million budget incorporates a number of operational and
commissioning costs. Mining commenced in November 2010 and as at
mid- January approximately 130,000 tonnes of ore was on the ROM
pad. Plant commissioning is imminent and first gold is due in the
March quarter.
-- Exploration - At Gold Ridge exploration in the quarter
focused on grade control and will move towards pit extensions and
new opportunities in the March and June quarters. At Simberi,
encouraging sulphide intercepts were returned from the Botlu pit.
On Tatau, drilling at Mt Letam/Talik did not return significant
intercepts and core drilling has moved to other targets at Mt Tiro,
Pepewo, and Seraro before returning to Mt Letam/Talik.
-- Corporate - During the quarter Allied achieved a realised
gold price of US$1,382/oz. As at 31 December 2010 cash at bank was
A$36.5 million. During the Quarter, the Group achieved a profit
after tax of A$8.3 million. The audited profit after tax for the
half year ended December 31, 2010 was A$9.4 million.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
This management's discussion and analysis ("MD&A") of Allied
Gold Limited ("Allied Gold" or the "Company") is dated February 11,
2011 and provides an analysis of the Company's performance and
financial condition for the three months ended December 31, 2010
(the "Quarter"). This MD&A should be read in conjunction with
the Company's audited interim consolidated financial statements for
the three months ended December 31, 2010 and the notes thereto.
These documents, along with others published by the Company are
available under the Company's profile on the Canadian System for
Electronic Document Analysis and Retrieval ("SEDAR") at www.
sedar.com.
The consolidated financial statements of Allied Gold and the
financial information contained in this MD&A were prepared in
accordance with Australian equivalents to International Financial
Reporting Standards as defined by the Australian Accounting
Standards Board ("Australian IFRS") and are fully compliant with
International Financial Reporting Standards as issued by the
International Accounting Standards Board. All amounts in this
MD&A are expressed in Australian dollars unless otherwise
identified, and references to "A$" are to Australian dollars.
This MD&A may contain forward-looking statements that are
based on the Company's expectations, estimates and projections
regarding its business and the economic environment in which it
operates. These statements speak only as of the date on which they
are made, are not guarantees of future performance and involve
risks and uncertainties that are difficult to control or predict.
Examples of some of the specific risks associated with the
operations of the Company are set out in the company's most recent
Annual Information Form ("AIF") under the section entitled "Risk
Factors". Actual outcomes and results may differ materially from
those expressed in these forward-looking statements and readers
should not place undue reliance on such statements. Readers are
also referred to the "Cautionary Note Regarding Forward-Looking
Statements" in this MD&A.
Overview
Allied Gold is a gold production company whose shares are listed
on the Toronto Stock Exchange ("TSX") under the symbol "ALG", on
the Australian Securities Exchange ("ASX") under the symbol "ALD"
and on AIM, a market operated by the London Stock Exchange plc
under the symbol "AGLD". Allied Gold's major assets are its 100%
owned Simberi gold project (the "Simberi Project"), which is
located on Simberi Island, the northernmost island of the Tabar
Islands Group, in the New Ireland Province of eastern PNG and its
100% interest in Australian Solomons Gold Limited ("ASG"), the
owner of the Gold Ridge Gold Project ("Gold Ridge") which is
located on Guadalcanal Island in the Solomon Islands.
The Simberi Project
The Simberi Project is located in the Pacific Rim of Fire, one
of the world's proven and most prospective gold jurisdictions. The
Simberi Project is comprised of: (i) an open-pit mining operation
with an associated gold processing plant, located within PNG mining
lease 136 ("ML 136"), which comprises 2,560 ha on the eastern side
of Simberi Island; and (ii) a larger 69 sub-block/233 km2 area
under PNG exploration license 609 ("EL 609") covering the remainder
of Simberi Island and most of the adjacent Tatau and Big Tabar
Islands to the south. The Simberi Project is based on seven
separate deposits on the eastern portion of Simberi Island
(Sorowar, Samat North, Samat South, Samat East, Pigiput, Pigibo and
Botlu South). Sorowar in the north is by far the largest resource.
Samat North, South and East lie to the south and while relatively
small are also relatively high grade. Pigiput, Pigibo and Botlu
South lie between the Sorowar and Samat areas and are of
intermediate tonnage but at a grade similar to Sorowar. All
prospects lie within 2-3 km of each other. The project area also
includes other less well defined prospects and anomalies.
The Simberi Project is the subject of a technical report (the
"Technical Report") entitled "Simberi Gold Project, Simberi Island,
Papua New Guinea" dated September 25, 2009 prepared for Allied Gold
by Stephen Godfrey and John Battista of Golder Associates Pty Ltd.
and Phil Hearse of Battery Limits Pty Ltd., all of whom are
independent qualified persons as defined in National Instrument
43-101 - Standards of Disclosure for Mineral Projects ("NI
43-101"). The Technical Report has been filed with certain Canadian
securities regulatory authorities pursuant to NI 43-101 and is
available for review under Allied Gold's SEDAR profile at www.
sedar.com.
The Gold Ridge Project
In November 2009, the Company acquired control of Australian
Solomons Gold Limited ("ASG").
ASG is an Australian-based mineral resource exploration company
that was incorporated under the Australian Corporations Act on
September 10, 2004. ASG converted its Australian legal status to a
"public" company on April 4, 2006, which was confirmed by the
Australian Securities and Investment Commission on September 6,
2006. The general development of the business of ASG has focused
entirely on the Gold Ridge project on the island of Guadalcanal in
the Solomon Islands (the "Gold Ridge Project").
ASG acquired the Gold Ridge Project in May 2005. The Gold Ridge
Project consists of a mining lease that covers an area of 30 km2
and a prospecting license in the area surrounding the mining lease
that covers an area of 130 km2. The mining lease is administered
under a mining agreement between ASG and the Solomon Islands
Government. ASG holds the Gold Ridge Project through certain
wholly-owned Australian and Solomon Islands subsidiaries.
Prior to ASG acquiring the Gold Ridge Project, previous owners
of the Gold Ridge Project had constructed a 2Mtpa open cut mine
starting in 1997 and mined the Valehaichichi deposit commencing in
August 1998. The Gold Ridge Project was eventually shut down in
September 2000 by a subsequent owner as a result of escalating
civil unrest in the Solomon Islands. The Regional Assistance
Mission to Solomon Islands ("RAMSI') was created in 2003 in
response to a request for international aid by the Governor-General
of the Solomon Islands. RAMSI is a partnership between the people
and Government of Solomon Islands and fifteen contributing
countries of the Pacific region. RAMSI is helping the Solomon
Islands to lay the foundations for long-term stability, security
and prosperity - through support for improved law, justice and
security; for more effective, accountable and democratic
government; for stronger, broad-based economic growth; and for
enhanced service delivery. The Australian government continues to
support RAMSI, contributing in excess of A$200 million per annum
for various development and support initiatives.
During the 22 months that the Gold Ridge mine was actively
operating, the total gold production amounted to approximately
210,000 ounces. The Gold Ridge Project has considerable
infrastructure remaining from the previous operations, although
major refurbishment is required to most of the plant and equipment
at site. Mine site infrastructure includes workshops and warehouse,
water supply, power generators and building, road access, tailings
storage facility, and an on-site camp for 150 people which have
recently been refurbished.
The Gold Ridge Project is the subject of (the "Technical
Report") entitled "Estimation of Recoverable Gold Resources Gold
Ridge Project" dated November 27, 2008 prepared for Australian
Solomons Gold Limited by W J A Yeo, MAusIMM PhD of Hellman &
Schofield Pty Ltd who is an independent qualified person as defined
in National Instrument 43-101 - Standards of Disclosure for Mineral
Projects ("NI 43-101"). The Technical Report has been filed with
certain Canadian securities regulatory authorities pursuant to NI
43-101 and is available for review under Australian Solomons Gold's
SEDAR profile at www. sedar.com.
In March 2010, Allied Gold formally commenced a A$150 million
project to redevelop the Gold Ridge project. Information regarding
the current status of the project is provided in the section of
this MD&A headed "Projects - Gold Ridge".
SIMBERI, PNG
Mill Throughput - Annualised mill throughput for the quarter was
2.4 Mtpa (compared to previous 2.0 Mtpa nameplate) and the process
recovery remains consistent at 89-91%. Most of the plant
debottlenecking activities undertaken during 2010 were in evidence
in the December quarter.
Inventory Adjustment - The December quarter saw the company
recognise and account for 100,000 tonnes of scats (pebble reject
material) that has been stockpiled but will be accessed in the
future. There was also an increase in gold in circuit of
approximately 1,600 ounces, but this will be reduced in coming
months due to plant modifications.
Oxide Plant Expansion - Work progressed on the 3.5Mtpa Simberi
oxide plant expansion with the award of leach tank and new diesel
tank construction and delivery of materials and equipment delivered
to site, including civils materials, plate and structural steel,
and SAG mill and components. Civil works for the construction of
two new leach tanks and lime slaker will commence in the March
quarter. Installation of a new SAG mill, which has been delivered
to site, will commence in the September quarter.
Plant Refurbishment - The de-bottlenecking and optimization
initiatives the Company commenced in 2010 have all but been
completed. The final upgrade of the Leach & CIL Tank motors,
gearboxes & agitators is ongoing and will be completed in the
March quarter.
Sulphide Study - The scope of work and A$8m budget for advancing
the Simberi sulphide development to Bankable Feasibility Study
(BFS) has been agreed. The aim is to deliver the BFS by the end of
2011 with the critical work to be completed incorporating (i)
further sulphide resource and reserve definition and metallurgical
drilling and (ii) roaster pilot plant test work. The BFS will be
optimised in 2012 in parallel with obtaining government permits to
build and operate a sulphide process plant and mine. The BFS will
deliver an economic study on a 2.5Mtpa flotation and roaster
circuit, integrated with the current expanded oxide and mining
processing expansion project.
Extensional and definition drilling for sulphide resources
continued. Assays received to date indicated disbursed sulphide
mineralisation at Sorowar controlled structure and possibly
lithology, while at Botlu interesting intercepts have been recorded
including 27m @ 5.26g/t from 40m in hole SDH142. (Refer to
exploration summary for further detail)
GOLD RIDGE, SOLOMON ISLANDS
The A$150 million redevelopment of the fully-funded 120,000ozpa
Gold Ridge gold mine located in the Solomon Islands advanced
significantly in the December quarter, with commissioning expected
to commence in February 2011.
Budget - Work is on time and on budget with approximately 85% of
the project budget committed and incurred. The remaining A$20
million to be spent primarily involves commissioning and operations
start up costs and community/village construction activities in
coming months.
Construction - The redevelopment of the process plant comprises
refurbishment and expansion of the plant from 2.0Mtpa to 2.5Mtpa
throughput. Work by the project's EPC contractor includes:
o Installation of crushing and grinding; crusher and SAG mill
refurbishment due in the March 2011 quarter.
o Classification and leaching; existing agitator gearboxes and
motors renewed/refurbished
o Installation of three additional leach tanks is complete,
cyclone tower and new cyclones installed.
o Gold recovery; new equipment including a new leach
reactor.
o Tailings disposal thickener has been completed as well as the
tailings detoxification tank. The tailings dam has been dewatered
and tailings and return water lines, and pump and choke stations
have been completed.
o Power has been installed by Aggreko ready to provide power in
the March 2011 quarter.
o Raw process water will be available in January with
installation of new river pumps and re-establishment of the intake
weir.
Allied's owners scope of work includes earthworks, mine
pre-operations mine development, infrastructure rebuilding
including buildings and offices, accommodation village, purchase of
mining fleet and construction equipment, first fill and spares, and
employment of mine operations personnel and operations
training.
All construction associated earthworks have been completed.
Pre-mine operations have progressed well including; warehousing,
spares, first fills and reagents, site administration, mine and
plant operations personnel in place.
During the quarter, resettlement of 241 people from the
Valehaichichi pit was undertaken and further houses will be built
in 2011 as part of the approved relocation plans.
Mining - Gold Ridge took delivery during the quarter of a larger
mining fleet of seven ridged frame 60 tonne haul trucks, two 85
tonne hydraulic excavators, and a mobile crushing and screening
plant. The mine haul roads to the Valehaichichi and Namachamata
pits have been established and mining at Valehaichichi has
commenced with approximately 130,000 tonnes of ore delivered to the
ROM stockpile. Drilling and blasting for mining commenced in
December with 6 blasts successfully completed quarter end.
CORPORATE
Cash - Cash at bank as at 31 December was A$36.5 million. A
US$35 million 5 year loan from the IFC was drawn down in September
2010. Principal repayments for this loan will commence in November
2011.
Hedging - The company is hedge-free following the unwinding of
its hedge position in early 2010 and achieved an average gold price
of US$1,382/oz (before amortization of deferred hedging losses) in
the December quarter on sales of 16,621 ounces.
Lead Director - Mr Sean Harvey was appointed a Director in March
2010, and in-line with TSX and AIM governance principles was
appointed in mid-December as the Lead Independent Non-Executive
Director. The Board of Allied has resolved to put to shareholders
the issue of 1,500,000 unlisted options to Mr Harvey at an exercise
price of 50c expiring on 31 December 2011 with 1,000,000 vesting
immediately and 500,000 vesting upon the share price trading at or
above 70c for 5 consecutive days. The motion will be put to
shareholders at the Company's next general meeting of members.
Profit after tax - During the Quarter, the Group achieved a
profit after tax of A$8.3 million. The audited profit after tax for
the half year ended December 31, 2010 was A$9.4 million.
EXPLORATION - COMMENTARY
Simberi, PNG
Highlights included testing extensions of gold mineralisation
into Sulphide below Sorowar pit and the development of a new 3D
model of sulphide resources at Botlu.
On Simberi, 29 core holes (3,952m) and 27 RC holes (1651m) were
completed during the quarter. Assays were received for 6,592
samples (including QC) with further 516 samples awaiting
analysis.
At Pigibo, RC hole RC1833 (32m @ 2.68g/t Au from 21m in OX, TR)
confirmed the down dip continuity of a similar intercept in RC1819
reported in the Sep '10 Qtr. Another 11m @ 1.33g/t Au from surface
in an adjacent hole (RC1834) indicates the mineralization strikes
SW towards Boltu. Access was prepared for follow-up RC
drilling.
At Botlu, two notable down hole intercepts of 27m @ 5.26g/t Au
from 40m in SU, including 2m @ 43.3g/t Au from 64m, (SDH142) and
33m @ 2.15g/t Au from 119m in SU (SDH163) helped confirm the new 3D
model of mineralisation in sulphide.
At Sorowar, Phase1 core drilling was completed with 12 holes /
2,152m completed. The drilling targeted mineralisation in the
Sulphide zone, below the Sorowar Oxide deposit. Significant
intercepts below the planned oxide pit included 20m @ 4.42g/t Au
from 111m in OX, SU (SDH149) and 34m @ 1.99g/t Au from 83m in TR,
SU (SDH152);
At SE Sorowar, better intercepts included 38m @ 1.15g/t Au from
28m in OX (SDH143) and 9m @ 16.5g/t Au from 128m, incl 1m @ 86.6g/t
and 1 m @ 30.1g/t, though a limited impact on resources is
expected.
Three holes, including RC1857 with 6m @ 1.57g/t Au from surface,
in series of 24 reconnaissance RC holes / 1,471m testing soil
anomalies along a track north of the Pigibo deposit, located
significant mineralization at surface. Follow-up channel sampling
in progress will assist planning to further RC drilling.
Simberi Exploration Outlook - In the March quarter exploration
activity will include core drilling targeting sulphides beneath the
Sorowar pit and further extensions at Botlu. Core drilling at
Pigiput and Botlu will provide bulk samples for metallurgical test
work for the sulphide feasibility study. RC drilling will focus on
search for gold in oxide resources around Pigibo and Sorowar
deposits.
Tatau / Tabar Islands, PNG - On Tatau drilling was focused on
the Mt Letam and Talik prospects with 6 core holes for 1,171 metres
completed during quarter.
Three holes were completed at each of the Mt Letam and Talik
prospects. The holes at Mt Letam tested an IP chargeability anomaly
and gold associated with quartz veining found in a previously
drilled core hole. Quartz veining and a disseminated
sulphide-bearing breccia unit (the likely cause of the geophysical
anomaly) were intersected, and both associated with trace amounts
of gold. At Talik, two core holes confirmed weak alteration zones
in inter-fingered microdiorite intrusive and andesite both
associated with minor amounts of disseminated and fracture-hosted
pyrite and some veining.
Assays were received for 555 samples (including QC) and a
further 302 samples, from Talik holes, are awaiting analysis. No
significant gold intercepts reported to date. In the March quarter
the focus will be on core drilling at Mt Tiro, Pepewo and Seraro
prospects on Tatau Island and line cutting and soil sampling for IP
survey at Banesa prospect, Tabar Island.
Gold Ridge, Solomon Islands
In the December quarter 1,490m of RC drilling was undertaken at
the Namachamata deposit; with total 3,524 metres drilled since
start-up completing the resource definition program.
The RC drilling, now at approximate 20m intervals on 25m spaced
lines, is focused on confirmation of gold grades and determination
of metallurgical recovery indicators . The main purpose of the
drilling is to establish indicators of gold recovery for better
mine planning. Sample assays of the new drilling are generally in
line with previous results.
Assay results were received for 42 drill holes, with samples for
a further 19 holes pending. Better down hole intercepts included
30m @ 4.12g/t Au from surface (GRC0032), 25m @ 6.97g/t Au from
surface (GRC0033) and 36m @ 2.77g/t from 3m (GRC0054) occurring
within the designed pit.
An Induced Polarization (IP) survey of 2.5 line kilometres was
completed and has helped define moderate to steeply dipping
anomalies associated with both the Dawsons and Kupers deposits. The
targets identified by the IP survey will be followed up with infill
surveying in the March quarter.
Drill targets to 150m can be tested with RC holes, the deep
targets would require core drilling. A core rig is programmed to
commence drilling in the March '11 quarter.
A complete listing of weighted average grades of mineralized
intercepts in holes recently drilled at Gold Ridge, defined by a
range of sample gold grade cut-offs, is presented in Table 6 below.
The method of sampling and calculation of the average grades (the
same as used in Table 1 to Table 5 for Simberi down hole
intercepts) is appended below Table 6.
Explanatory notes applying to Table 1 to Table 6 that
follow.
Broad down hole intercepts are determined using a cut-off of 0.5
g/t Au and a minimum grade*length of 5gmpt. Such intercepts may
include material below cut-off but no more than 5 sequential meters
of such material and except where the average drops below the
cut-off. Selvage is only included where its average grade exceeds
0.5/t. Using the same criteria for included sub-grade,
supplementary cut-offs of 2.5g/t , 5.0g/t and 10g/t are used to
highlight higher grade zones and spikes. Single assays intervals
are reported only where >5.0g/t and >=1m down hole. No high
grade cut is applied.
Drill core was cut with a diamond saw and half-core samples were
taken for assaying, generally over one metre intervals. The samples
were bagged and delivered to the Company's on-site sample
preparation facility in the same secured compound at Simberi. The
core samples were then crushed to minus 2 mm and riffle split with
half the sample pulverised to 90% passing 75 microns. Approximately
150 g of pulverised sample was bagged for shipment to the selected
analytical laboratory. The remaining half core and coarse crushed
material and a 200 g reference pulp sample were all archived in an
adjacent locked storage area.
RC samples, collected below a cyclone over 1 metre intervals,
were split to 1kg (Simberi) or 2kg (Gold Ridge), using a single
tier riffle splitter. The 1kg samples were bagged and delivered to
the Company's on-site sample preparation facilities at the site
where the drilling was done, either Simberi or Gold Ridge, The RC
cutting samples were then crushed to minus 2 mm and riffle split
with half the sample pulverised to 90% passing 75 microns.
Approximately 150 g of pulverised sample was bagged for shipment to
the selected analytical laboratory. The remaining cuttings material
and, at Simberi, a 200 g reference pulp sample were archived in an
adjacent locked storage area.
The pulversised samples were analysed either by an ALS (ALS_TSV)
or Genalysis (GEN_TSV) laboratory (both independent of the Company)
in Townsville, Australia or, for Simberi samples only, an on-site
Company laboratory at Simberi dedicated to exploration samples
(EXLAB). The Company's QA/QC procedures include the insertion of
approximately 15% commercially produced analytical standards,
crushed and pulverized duplicates and blanks in each sample
batch.
The gold assay method is either Fire Assay with a 0.01g/t Au
detection limit (ALS_TSV and GEN_TSV) or Aqua Regia digest of a 25g
charge with a 0.02g/t Au detection limit (EXLAB). Samples, with a
reported below detection grade, are assigned a grade of half the
detection limit. Duplicates, inserted for QC purposes, are not
averaged. Where reported, Ag grade is its weighted average over the
same interval as that defined by the Au intercept. Ag is determined
by ALS_TSV using an Aqua Regia digest of a 0.5g charge followed by
ICP OES analysis, with a detection limit of 0.2g/t Ag.
In core holes, intercept grades are calculated using sample
grades weighted by sampled length divided by interval length. This
results in any included core loss being assigned zero grade. The
average grade over the length of hole sampled is shown as a ranking
guide and is calculated without any cut-off applied.
The information provided in this report/statement/release
constitutes Mineral Exploration Results as defined in JORC code,
Clause 16. It is inappropriate to use such information for deriving
estimates of tonnage and grade without fully taking into account
its complete relational context.
Table 1 Botlu - Simberi >0.5 g/t Mineralised Intercepts
Reported Dec Qtr 2010
Au Ag
TIG TIG RL From To Intercept Grade Grade
Hole North East (m) Dip/Azi (m) (m) (m) (g/t) (g/t) Oxidation
-70
SDH142 208306.0 43448.9 214.1 / 180 0.0 161.5 1.19 EXLAB
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
loss
0.1m 3.0 34.0 31.0 1.35 SU
and 9.0 21.0 12.0 1.36 SU
loss
0.1m and 25.0 34.0 9.0 1.78 SU
loss
1.0m 40.0 57.0 17.0 2.39 SU
loss
1.0m incl 42.0 57.0 15.0 2.61 SU
loss
0.8m incl 42.0 54.0 12.0 2.91 SU
incl 46.0 47.0 1.0 6.45 SU
loss
0.4m 40.0 67.0 27.0 5.26 SU
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
loss
0.4m incl 61.0 67.0 6.0 19.4 SU
loss
0.2m incl 64.0 66.0 2.0 43.3 SU
Total core loss
= 1.8 m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-70
SDH161 208422.9 43464.3 223.9 / 180 0.0 220.0 0.66 EXLAB
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
131.0 186.0 55.0 1.37 SU
incl 133.0 137.0 4.0 1.36 SU
and 141.0 146.0 5.0 2.84 SU
incl 142.0 145.0 3.0 3.89 SU
and 163.0 186.0 23.0 1.79 SU
incl 168.0 170.0 2.0 5.42 SU
Total core loss
=0.1m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-75
SDH162 208377.8 43403.4 207.9 / 178 0.0 151.1 0.45 ALS+EXLAB
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
44.0 54.0 10.0 1.58 SU
incl 45.0 47.0 2.0 3.46 SU
82.0 115.0 33.0 1.22 SU
incl 95.0 114.0 19.0 1.47 SU
Total core loss
=1.5m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-80
SDH163 208344.7 43530.8 203.0 / 235 0.0 172.1 1.43 ALS+EXLAB
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
53.0 68.0 15.0 9.15 SU
incl 53.0 56.0 3.0 10.8 SU
incl 53.0 54.0 1.0 17.7 SU
and 64.0 66.0 2.0 44.9 SU
incl 64.0 65.0 1.0 84.6 SU
119.0 152.0 33.0 2.15 SU
incl 119.0 128.0 9.0 4.38 SU
incl 120.0 122.0 2.0 5.45 SU
and 126.0 127.0 1.0 11.70 SU
155.0 165.0 10.0 0.79 SU
Total core loss
=0.1m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
Table 2 - Sorowar, Simberi >0.5 g/t Mineralised Intercepts --
Reported Dec Qtr 2010
Au Ag
TIG TIG RL From To Intercept Grade Grade
Hole North East (m) Dip/Azi (m) (m) (m) (g/t) (g/t) Oxidation
-65
SDH147 210320.3 44393.2 207.3 / 45 0.0 150.6 0.93 ALS_TSV
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
loss
0.7m 10.0 33.0 23.0 1.46 OX
incl 14.0 16.0 2.0 2.33 OX
21.0 32.0 11.0 1.98 OX
incl 27.0 29.0 2.0 3.47 OX
loss
2.0m 46.0 57.0 11.0 4.92 OX
loss
2.0m incl 47.0 55.0 8.0 6.21 OX
incl 48.0 49.0 1.0 6.8 OX
loss
0.3m and 53.0 54.0 1.0 24.4 27.2 OX
61.0 67.0 6.0 1.79 OX
incl 61.0 66.0 5.0 2.00 OX
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
99.0 101.0 2.0 4.16 TR
incl 99.0 100.0 1.0 6.31 TR
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
Total core
loss =2.5m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-60
SDH148 210274.7 44259.9 213.3 / 45 0.0 183.3 0.92 ALS_TSV
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
loss
2.0m 0.0 42.0 42.0 2.21 OX
incl 6.0 8.0 2.0 3.10 OX
and 17.0 25.0 8.0 7.36 OX
incl 17.0 18.0 1.0 6.20 OX
incl 23.0 25.0 2.0 16.6 OX
and 34.0 38.0 4.0 1.61 OX
OX, TR,
81.0 93.0 12.0 2.56 SU
incl 81.0 83.0 2.0 3.39 OX, TR
and 87.0 93.0 6.0 3.52 SU
incl 91.0 92.0 1.0 5.61 SU
loss
1.0m 97.0 104.0 7.0 1.07 SU
125.0 129.0 4.0 2.34 SU
loss
1.0m 164.0 173.0 9.0 1.45 SU
Total core
loss = 8.0m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-60
SDH149 210254.0 44308.7 215.2 / 45 0.0 212.8 0.51 ALS_TSV
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
loss
2.1m 111.0 131.0 20.0 4.42 OX, SU
loss
2.1m incl 111.0 126.0 15.0 5.68 OX, SU
loss
2.1m incl 114.0 123.0 9.0 8.62 18.0 OX, SU
incl 115.0 116.0 1.0 6.27 20.3 OX
loss
2.0m and 119.0 123.0 4.0 13.9 25.0 OX
Total core
loss = 2.2m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-60
SDH150 210160.4 44074.0 224.4 / 45 0.0 224.3 0.22 ALS_TSV
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
48.0 52.0 4.0 1.36 TR
177.0 186.0 9.0 1.00 SU
Total core
loss =1.2m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-60
SDH151 209998.1 44416.2 194.7 / 45 0.0 200.0 0.78 ALS_TSV
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
56.0 62.0 6.0 21.6 OX
incl 58.0 59.0 1.0 91.8 OX
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
Total core
loss =5.0m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-60
SDH152 210291.4 44206.4 212.2 / 45 0.0 158.3 0.84 ALS_TSV
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
0.0 11.0 11.0 1.26 OX
incl 0.0 5.0 5.0 1.39 OX
loss
0.8m 48.7 75.0 26.3 1.21 TR, SU
loss
0.5m incl 51.0 61.5 10.5 1.90 SU
loss
0.2m incl 52.0 54.2 2.2 2.86 SU
83.0 117.0 34.0 1.99 TR, SU
incl 94.0 97.0 3.0 1.75 TR, SU
and 103.0 112.0 9.0 5.10 TR, SU
incl 103.0 111.0 8.0 5.63 SU
incl 103.0 106.0 3.0 12.7 9.4 SU
incl 103.0 105.0 2.0 17.0 11.5 SU
Total core
loss =2.0m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-60
SDH153 210214.4 44059.2 223.2 / 45 0.0 192.4 0.37 ALS_TSV
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
0.0 21.0 21.0 0.75 OX
44.0 61.0 17.0 1.21 OX
118.0 124.0 6.0 1.15 TR, SU
Total core
loss = 0.7m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-60
SDH154 210251.7 44021.0 226.4 / 45 0.0 216.4 0.15 EXLAB
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
157.0 160.0 3.0 3.51 SU
Total core
loss = 1.7m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-60
SDH155 210376.9 44154.3 217.0 / 45 0.0 148.1 0.30 EXLAB
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
0.0 10.0 10.0 1.09 OX
16.0 28.0 12.0 0.92 OX
Total core
loss =0.2m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-60
SDH156 210402.6 44319.3 227.8 / 45 0.0 150.6 0.14 EXLAB
0.0 7.0 7.0 1.23 OX
Total core
loss =0.2m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-53.5
SDH157 210409.0 44258.1 227.5 / 47 0.0 150.6 0.50 EXLAB
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
0.0 7.0 7.0 2.15 OX
incl 0.0 1.0 1.0 5.20 OX
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
88.0 96.0 8.0 5.73 OX
incl 90.0 95.0 5.0 7.73 OX
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
incl 93.0 94.0 1.0 27.1 OX
Total core
loss =0.1m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-60
SDH158 210090.7 44357.5 208.9 / 45 0.0 122.5 0.95 EXLAB
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
0.0 8.0 8.0 3.48 OX
incl 4.0 5.0 1.0 17.6 OX
24.0 34.0 10.0 3.96 OX
incl 25.0 28.0 3.0 7.30 OX
incl 26.0 28.0 2.0 8.93 OX
and 30.0 31.0 1.0 5.16 OX
84.0 99.0 15.0 2.52 OX
incl 92.0 98.0 6.0 3.66 OX
incl 95.0 97.0 2.0 5.69 OX
Total core
loss =0.1m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-60
SDH159 210157.4 44140.8 222.7 / 49 0.0 217.8 0.16 EXLAB
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
loss
0.2m 83.0 88.0 5.0 2.82 OX, SU
incl 84.0 85.0 1.0 6.14 OX
Total core
loss =4.3m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-60
SDH160 209927.9 44144.4 190.2 / 45 0.0 158.3 0.09 EXLAB
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
loss
0.2m 26.0 32.0 6.0 0.9 SU
Total core
loss =1.1m
------------------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
Table 3 Samat - Simberi Deposit >0.5 g/t Mineralised
Intercepts -- Reported Dec Qtr 2010
Au
TIG TIG RL From To Intercept Grade Avg Est
Hole North East (m) Dip/Azi (m) (m) (m) (g/t) Recovery Oxidation
-60
SDH140 207300.0 44752.8 40.2 / 315 0.0 161.1 0.26 EXLAB
---------- --------- -------- ------ -------- ------ ------ ---------- ------ --------- ----------
loss
0.65m 79.0 87.0 8.0 1.38 SU
loss
0.1m incl 82.0 84.0 2.0 2.77 SU
109.0 120.0 11.0 0.85 SU
124.0 133.0 9.0 1.11 SU
Total core
loss = 1.15
m
--------------------- -------- ------ -------- ------ ------ ---------- ------ --------- ----------
-60
RC1822DD 207497.8 44440.3 109.8 / 180 0.0 160.1 0.19 EXLAB
---------- --------- -------- ------ -------- ------ ------ ---------- ------ --------- ----------
loss
2.2m 123.0 130.0 7.0 0.89 SU
135.0 143.0 8.0 1.52 SU
Total core
loss = 2.1
m
--------------------- -------- ------ -------- ------ ------ ---------- ------ --------- ----------
Table 4 SE Sorowar Simberi Deposit >0.5 g/t Mineralised
Intercepts -- Reported Dec Qtr 2010
Au Ag
TIG TIG RL From To Intercept Grade Grade
Hole North East (m) Dip/Azi (m) (m) (m) (g/t) (g/t) Oxidation
-60 /
SDH141 209532.9 44582.9 171.1 45 0.0 180.6 0.36 EXLAB
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
19.0 41.0 22.0 0.78 OX
79.0 85.0 6.0 0.93 OX
171.0 180.6 9.6 1.18 SU
Total core loss =
3.8 m
----------------------------- ------ -------- ------ ------ ---------- ------ ------ ----------
-55 /
SDH143 209563.8 44563.4 177.6 45 0.0 162.0 0.73 EXLAB
28.0 66.0 38.0 1.15 OX
loss
0.1m 80.0 93.0 13.0 1.76 OX
incl 82.0 84.0 2.0 2.65 OX
and 88.0 90.0 2.0 3.09 OX
115.0 119.0 4.0 1.38 SU
128.0 130.0 2.0 4.21 SU
incl 129.0 130.0 1.0 6.25 SU
Total core loss =
1.8 m
----------------------------- ------ -------- ------ ------ ---------- ------ ------ ----------
-55 /
SDH144 209692.3 44538.1 204.2 90 0.0 185.1 0.96 EXLAB
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
128.0 137.0 9.0 14.9 SU
incl 129.0 130.0 1.0 5.62 SU
and 133.0 137.0 4.0 30.5 SU
incl 134.0 135.0 1.0 83.2 SU
and 136.0 137.0 1.0 30.1 SU
Total core loss =
0.6 m
----------------------------- ------ -------- ------ ------ ---------- ------ ------ ----------
-55 /
SDH145 209694.6 44538.5 204.2 45 0.0 250.0 0.17 EXLAB
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
79.0 83.0 4.0 3.20 TR
incl 80.0 82.0 2.0 5.36 TR
Total core loss =2.9m
----------------------------- ------ -------- ------ ------ ---------- ------ ------ ----------
-55 /
SDH146 209697.5 44537.3 204.1 315 0.0 153.3 0.53 EXLAB
-------- --------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
110.0 117.0 7.0 3.02 SU
incl 111.0 114.0 3.0 4.04 SU
124.0 137.0 13.0 2.35 SU
incl 129.0 131.0 2.0 4.05 SU
and 135.0 137.0 2.0 6.97 SU
Total core loss =
1.4m
----------------------------- ------ -------- ------ ------ ---------- ------ ------ ----------
Table 5 Pigibo - Simberi Deposit >0.5 g/t Mineralised
Intercepts -- Reported Dec Qtr 2010 -
Au Ag
TIG TIG RL From To Intercept Grade Grade
Hole North East (m) Dip/Azi (m) (m) (m) (g/t) (g/t) Oxidation
-60
RC1833 208795.3 43700.2 226.1 / 180 0.0 60.0 1.82 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
OX,
0.0 3.0 3.0 4.97 TR
incl 0.0 2.0 2.0 6.97 OX
incl 0.0 1.0 1.0 10.8 OX
21.0 53.0 32.0 2.68 OX
incl 21.0 27.0 6.0 1.90 OX
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
incl 26.0 29.0 3.0 3.10 OX
incl 26.0 27.0 1.0 6.34 OX
and 33.0 53.0 20.0 3.36 OX
incl 37.0 46.0 9.0 5.43 OX
incl 39.0 40.0 1.0 6.86 OX
and 42.0 46.0 4.0 7.18 OX
and 17.0 32.0 15.0 2.82 OX
incl 20.0 26.0 6.0 4.53 OX
incl 23.0 25.0 2.0 6.95 OX
-60
RC1834 208811.0 43653.2 227.4 / 180 0.0 60.0 0.38 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
0.0 11.0 11.0 1.33 OX
incl 3.0 7.0 4.0 1.72 OX
-60
RC1835 208844.7 43600.4 232.0 / 180 0.0 60.0 0.26 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
19.0 21.0 2.0 3.07 OX
incl 20.0 21.0 1.0 5.65 OX
-60
RC1836 209046.4 43402.0 224.9 / 180 0.0 60.0 0.10 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
No significant
0.0 60.0 intercepts
-60
RC1837 209094.6 43400.7 203.7 / 180 0.0 80.0 0.02 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
No significant
0.0 80.0 intercepts
-60
RC1838 209110.2 43447.9 203.3 / 180 0.0 60.0 0.06 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
0.0 60.0 No significant intercepts
-60
RC1839 209110.2 43447.9 203.3 / 180 0.0 80.0 0.09 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
OX,
3.0 8.0 5.0 1.03 SU
-60
RC1840 209157.0 43501.1 193.3 / 180 0.0 80.0 0.21 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
15.0 24.0 9.0 1.09 SU
-60
RC1841 209158.3 43548.9 200.7 / 180 0.0 80.0 0.11 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
22.0 26.0 4.0 1.02 SU
-60
RC1842 209152.1 43603.1 200.2 / 180 0.0 80.0 0.38 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
23.0 36.0 13.0 0.96 SU
-60
RC1843 209097.7 43653.0 219.5 / 180 0.0 80.0 0.23 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
0.0 80.0 No significant intercepts
-60
RC1844 209098.4 43600.7 223.0 / 180 0.0 80.0 0.23 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
No significant
0.0 80.0 intercepts
-60
RC1845 209185.0 43574.2 195.3 / 180 0.0 80.0 0.24 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
No significant
0.0 80.0 intercepts
-60
RC1846 209195.5 43621.0 188.9 / 180 0.0 80.0 0.21 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
No significant
0.0 80.0 intercepts
-60
RC1847 209227.0 43676.4 185.4 / 180 0.0 60.0 0.28 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
No significant
0.0 80.0 intercepts
-60
RC1848 209253.9 43711.1 186.0 / 180 0.0 60.0 0.24 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
No significant
0.0 60.0 intercepts
-60
RC1849 209288.4 43740.4 187.4 / 180 0.0 60.0 0.22 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
No significant
0.0 60.0 intercepts
-60
RC1850 209296.0 43774.3 186.4 / 180 0.0 60.0 0.25 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
No significant
0.0 60.0 intercepts
-60
RC1851 209247.5 43881.4 174.2 / 180 0.0 60.0 0.20 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
5.0 15.0 10.0 0.69 OX
-60
RC1852 209319.6 43961.8 151.9 / 180 0.0 60.0 0.05 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
No significant
0.0 60.0 intercepts
-60
RC1853 209324.7 43961.3 151.8 / 270 0.0 60.0 0.03 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
No significant
0.0 60.0 intercepts
-60
RC1854 209370.0 44004.7 148.0 / 180 0.0 46.0 0.22 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
0.0 5.0 5.0 1.22 OX
-60
RC1856 209377.4 44006.3 147.8 / 360 0.0 60.0 0.26 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
0.0 3.0 3.0 1.91 OX
-60
RC1857 209376.4 44004.3 147.7 / 180 0.0 60.0 0.23 EXLAB
-------- --------- -------- ------ -------- ----- ----- ---------- ------ ------ ----------
0.0 6.0 6.0 1.57 OX
Table 6 Namachamata, Gold Ridge >0.5 g/t Mineralised
Intercepts - Reported Dec Qtr 2010
Au Ag
TIG TIG RL From To Intercept Grade Grade
Hole North East (m) Dip/Azi (m) (m) (m) (g/t) (g/t) Oxidation
-60 /
GRC0021 40650.3 23574.9 450.6 270 0.0 60.0 2.30
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
OX, TR,
13.0 27.0 14.0 2.88 SU
OX, TR,
incl 14.0 22.0 8.0 3.79 SU
incl 16.0 17.0 1.0 7.01 TR
and 20.0 22.0 2.0 6.62 OX, SU
and 25.0 27.0 2.0 2.00 OX, SU
OX, TR,
43.0 52.0 9.0 10.0 SU
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
incl 45.0 46.0 1.0 6.02 OX
and 48.0 50.0 2.0 40.3 OX
incl 48.0 49.0 1.0 77.6 OX
-60 /
GRC0022 40559.2 23615.1 450.1 270 0.0 60.0 0.25
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
0.0 2.0 2.0 0.93
26.0 32.0 6.0 1.04 OX, SU
-60 /
GRC0023 40703.5 23514.8 464.1 270 0.0 40.0 0.02
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No
significant
results
-60 /
GRC0024 40703.6 23553.3 455.1 270 0.0 40.0 0.37
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
16.0 22.0 6.0 0.96 TR, SU
incl 17.0 19.0 2.0 1.43 TR
32.0 34.0 2.0 2.58 SU
-60 /
GRC0025 40706.0 23569.1 453.0 270 0.0 60.0 0.38
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
OX, TR,
9.0 24.0 15.0 1.05 SU
incl 10.0 13.0 3.0 1.10 OX
and 22.0 24.0 2.0 2.09 TR
25.0 28.0 3.0 0.52 TR
-60 /
GRC0026 40550.3 23647.4 430.0 270 0.0 40.0 0.18 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
0.0 3.0 3.0 0.66 OX
-60 /
GRC0027 40749.9 23521.4 466.0 270 0.0 40.0 0.03 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 40.0 intercepts
-60 /
GRC0028 40750.6 23549.1 455.9 270 0.0 50.0 0.01 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 50.0 intercepts
-60 /
GRC0029 40748.8 23575.3 445.2 270 0.0 60.0 0.03 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 60.0 intercepts
-60 /
GRC0030 40702.1 23592.1 438.4 270 0.0 70.0 0.72 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
3.0 10.0 7.0 3.68 OX
3.0 4.0 1.0 9.60 10.2 OX
6.0 8.0 2.0 4.38 OX
27.0 30.0 3.0 0.77 SU
-60 /
GRC0031 40704.2 23609.8 434.1 270 0.0 58.0 1.27 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
0.0 19.0 19.0 2.24 OX, SU
incl 7.0 9.0 2.0 5.20 SU
and 14.0 19.0 5.0 4.78 SU
incl 16.0 19.0 3.0 6.92 SU
incl 18.0 19.0 1.0 13.05 SU
26.0 34.0 8.0 2.05 SU
incl 27.0 29.0 2.0 4.12 SU
and 32.0 33.0 1.0 5.73 SU
42.0 58.0 16.0 0.73 SU
-60 /
GRC0032 40750.4 23600.3 435.3 270 0.0 70.0 2.19 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
0.0 30.0 30.0 4.12 OX, SU
incl 0.0 3.0 3.0 4.12 OX
incl 0.0 1.0 1.0 8.31 OX
and 11.0 30.0 19.0 5.55 SU
incl 12.0 13.0 1.0 6.03 SU
and 17.0 22.0 5.0 8.34 SU
incl 20.0 21.0 1.0 17.40 22.9 SU
and 23.0 27.0 4.0 7.50 SU
incl 23.0 26.0 3.0 10.26 SU
incl 24.0 26.0 2.0 12.75 9.1 SU
and 28.0 30.0 2.0 7.34 SU
42.0 44.0 2.0 1.22 SU
51.0 56.0 5.0 4.52 SU
incl 53.0 56.0 3.0 7.17 SU
incl 54.0 56.0 2.0 10.24 SU
incl 54.0 55.0 1.0 14.85 SU
-60 /
GRC0033 40756.6 23648.8 420.2 270 0.0 70.0 2.79 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
0.0 25.0 25.0 6.97 OX, SU
incl 3.0 25.0 22.0 7.53 SU
incl 3.0 6.0 3.0 5.24 SU
and 8.0 10.0 2.0 7.04 SU
and 12.0 16.0 4.0 3.72 SU
incl 12.0 13.0 1.0 6.88 9.4 SU
and 18.0 20.0 2.0 52.74 12.2 SU
incl 19.0 20.0 1.0 96.20 13.1 SU
28.0 37.0 9.0 2.20 SU
incl 31.0 37.0 6.0 2.99 SU
incl 34.0 36.0 2.0 5.82 SU
49.0 51.0 2.0 0.68 SU
-60 /
GRC0034 40752.8 23668.6 414.4 270 0.0 70.0 0.01 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 70.0 intercepts
-60 /
GRC0035 40753.9 23625.8 425.3 270 0.0 30.0 0.06 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 30.0 intercepts
-60 /
GRC0036 40700.3 23644.7 418.0 270 0.0 75.0 0.29 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
50.0 52.0 2.0 1.41 SU
73.0 75.0 2.0 2.30 SU
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-60 /
GRC0037 40795.0 23659.6 420.8 270 0.0 50.0 0.14 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 50.0 intercepts
-60 /
GRC0038 40700.0 23630.0 417.9 270 0.0 50.0 0.55 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
10.0 50.0 40.0 1.54 SU
31.0 39.0 8.0 1.48 SU
incl 31.0 34.0 3.0 2.80 SU
43.0 47.0 4.0 0.69 SU
-60 /
GRC0039 40700.0 23670.0 409.1 270 0.0 50.0 0.03 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 50.0 intercepts
-60 /
GRC0040 40800.0 23630.0 428.0 270 0.0 70.0 0.22 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
57.0 63.0 6.0 1.25 SU
incl 57.0 60.0 3.0 1.93 SU
-60 /
GRC0041 40700.0 23660.0 413.9 270 0.0 70.0 0.02 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 70.0 intercepts
-60 /
GRC0042 40750.0 23690.0 409.6 270 0.0 60.0 0.01 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 60.0 intercepts
-60 /
GRC0043 40800.0 23690.0 410.8 270 0.0 60.0 0.06 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 60.0 intercepts
-60 /
GRC0044 40800.0 23610.0 437.7 270 0.0 40.0 0.04 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 40.0 intercepts
-60 /
GRC0045 40800.0 23530.0 471.0 270 0.0 40.0 0.01 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 40.0 intercepts
-60 /
GRC0046 40802.0 23570.0 448.9 270 0.0 50.0 0.03 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 50.0 intercepts
-60 /
GRC0047 40825.0 23604.0 448.0 270 0.0 70.0 0.02 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 70.0 intercepts
-60 /
GRC0048 40838.0 23571.0 462.5 270 0.0 60.0 0.01 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 60.0 intercepts
-60 /
GRC0049 40804.0 23530.0 467.0 270 0.0 60.0 0.06 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 60.0 intercepts
-60 /
GRC0050 40805.0 23605.0 439.7 270 0.0 40.0 0.04 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 40.0 intercepts
-60 /
GRC0051 40775.0 23560.0 444.6 270 0.0 40.0 0.01 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
No significant
0.0 40.0 intercepts
-60 /
GRC0052 40775.0 23620.0 428.4 270 0.0 40.0 2.06 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
2.0 16.0 14.0 4.88
7.0 16.0 9.0 7.10
incl 7.0 8.0 1.0 44.60
and 11.0 14.0 3.0 4.32
incl 11.0 12.0 1.0 7.41
34.0 40.0 6.0 0.84
incl 35.0 37.0 2.0 1.21
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
-60 /
GRC0053 40775.0 23600.0 433.4 270 0.0 40.0 1.08 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
0.0 2.0 2.0 5.56
1.0 2.0 1.0 7.29
20.0 25.0 5.0 6.12
incl 20.0 21.0 1.0 11.10
and 22.0 24.0 2.0 8.42
-60 /
GRC0054 40775.0 23640.0 423.4 270 0.0 40.0 2.51 ALS_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
3.0 39.0 36.0 2.77
incl 6.0 24.0 18.0 2.47
incl 14.0 15.0 1.0 7.53
incl 14.0 22.0 8.0 3.65
and 19.0 20.0 1.0 5.10
and 30.0 39.0 9.0 5.58
incl 31.0 34.0 3.0 13.75
incl 32.0 34.0 2.0 18.83
-60 /
GRC0055 40728.0 23600.0 436.9 270 0.0 50.0 1.54 GEN_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
1.0 5.0 4.0 1.67
incl 1.0 4.0 3.0 1.91
10.0 12.0 2.0 1.81
15.0 18.0 3.0 11.00
incl 16.0 17.0 1.0 30.00
22.0 24.0 2.0 7.37
incl 23.0 24.0 1.0 13.40
27.0 30.0 3.0 1.07
33.0 35.0 2.0 1.27
43.0 45.0 2.0 2.69
47.0 64.0 17.0 0.59
-60 /
GRC0056 40724.0 23620.0 431.8 270 0.0 50.0 1.28 GEN_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
0.0 9.0 9.0 2.34
incl 0.0 8.0 8.0 2.54
incl 6.0 7.0 1.0 7.62
12.0 14.0 2.0 1.92
17.0 20.0 3.0 1.77
26.0 36.0 10.0 1.82
incl 26.0 35.0 9.0 1.95
38.0 43.0 5.0 1.79
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
incl 41.0 43.0 2.0 4.15
incl 42.0 43.0 1.0 7.11
-60 /
GRC0057 40723.0 23641.0 425.4 270 0.0 50.0 0.86 GEN_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
0.0 3.0 3.0 0.77
12.0 16.0 4.0 2.33
incl 13.0 14.0 1.0 6.14
30.0 33.0 3.0 1.18
incl 30.0 32.0 2.0 1.31
37.0 41.0 4.0 4.48
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
incl 40.0 41.0 1.0 11.10
-60 /
GRC0058 40721.0 23659.0 421.8 270 0.0 50.0 0.22 GEN_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
0.0 4.0 4.0 0.57
27.0 33.0 6.0 1.10
incl 31.0 33.0 2.0 2.22
-60 /
GRC0059 40725.0 23580.0 445.9 270 0.0 50.0 0.91 GEN_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
12 26.0 14.0 3.03
incl 16 26.0 10.0 3.45
incl 19 20.0 1.0 5.37
and 24 26.0 2.0 6.01
-60 /
GRC0060 40675.0 23623.0 426.7 270 0.0 50.0 0.67 GEN_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
11.0 15.0 4.0 1.00
incl 13.0 15.0 2.0 1.39
23.0 27.0 4.0 1.98
incl 25.0 27.0 2.0 3.53
incl 25.0 26.0 1.0 5.07
47.0 49.0 2.0 0.75
-60 /
GRC0061 40672.0 23635.0 425.7 270 0.0 50.0 0.96 GEN_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
6.0 18.0 12.0 3.08
incl 7.0 11.0 4.0 7.26
incl 9.0 10.0 1.0 23.7
and 14.0 18.0 4.0 1.36
45.0 48.0 3.0 1.26
incl 46.0 48.0 2.0 1.48
-60 /
GRC0062 40675.0 23660.0 421.5 270 0.0 50.0 1.90 GEN_TSV
--------- -------- -------- ------ -------- ------ ------ ---------- ------ ------ ----------
41.0 50.0 9.0 10.1
incl 41.0 49.0 8.0 11.3
incl 47.0 48.0 1.0 80.4
RESULTS OF OPERATIONS
Cash position as at December 31, 2010
Allied Gold's cash position as at December 31, 2010 was
A$36,486,444 in available cash and cash equivalents, compared with
A$72,047,976 as at September 30, 2010 and A$85,525,391 as at June
30, 2010. The decrease was primarily attributable to capital
expenditure A$31.7million in relation to the redevelopment of the
Gold Ridge Project.
Quarter ended December 31, 2010 as compared to Quarter ended
December 31 2009
The tables below summarises the key financial and operating
statistics for Allied Gold's mining and processing activities for
the Quarter and the Previous Quarter:
3 months ended 3 months ended
December 31, December 31,
2010 2009
Key financial statistic A$ A$
Sales revenue 20,803,462 17,151,610
Gross margin 4,474,955 (1,424,321)
Corporate expenses (2,449,247) (5,479,281)
Share based remuneration expense 1,252,500 (6,819,755)
Financial expenses (147,564) (1,072,642)
Other expenses /(income) 5,185,570 (1,647,428)
-------------- --------------
Profit / (loss) for the period 8,316,214 (16,443,427)
-------------- --------------
3 months ended 3 months ended
December 31, December 31,
2010 2009
Key financial statistics A$ A$
Cashflow from operations 2,431,555 (7,607,792)
Cashflow from investing activities (47,753,894) (694,971)
Cashflow from financing activities 9,271,606 148,632,941
-------------- --------------
Net cashflow (36,050,733) 140,330,178
-------------- --------------
3 months ended 3 months ended 12 months
Key operating Unit of December 31, December 31, ended June
statistic measure 2010 2009 30, 2010
Waste
mined........
.............
.............
.............
.............
.............
.............
.............
... tonnes 528,031 158,084 634,296
Ore
mined........
.............
.............
.............
.............
.............
.............
.............
........ tonnes 655,288 495,121 1,981,500
Ore
processed....
.............
.............
.............
.............
.............
.............
.............
.... tonnes 583,031 482,865 1,949,650
Grade........
.............
.............
.............
.............
.............
.............
.............
............. grams of
... gold/tonne 1.14 1.26 1.18
Recovery.....
.............
.............
.............
.............
.............
.............
.............
............. % 88.5 88.5 87.9
Gold
produced.....
.............
.............
.............
.............
.............
.............
.............
... ounces 18,921 17,456 64,327
Gold
sold.........
.............
.............
.............
.............
.............
.............
............ ounces 16,621 17,971 63,960
Profit for the Quarter compared to the Previous Quarter
Allied Gold reported revenue of A$20,803,462 and a net profit of
A$8,316 214 or 0.80 cents per share for the Quarter, compared with
revenue of A$17,151,610 and a net loss of (A$16,443,427) or (2.78)
cents per share for the prior corresponding Quarter ended December
31, 2009 (the "Previous Quarter").
The results for the Quarter (December 2010) as compared to the
Previous Quarter (December 2009) reflect the following:
-- Gold revenue for the Quarter of A$20,803,462 was 21% higher
than gold revenue of A$17,151,610 in the Previous Quarter for the
following reasons:
- Sales of 16,621 ounces in 2010 compared to 17,971 ounces in
2009 (an unfavourable volume variance of A$1.3 million). Whilst
gold production of 18,921 ounces in 2010 exceeded production of
17,456 ounces in 2009, the volume of gold sold was lower in
2010.This resulted from a build up of gold in circuit due to the
adverse impact on the elution circuit of a deterioration in water
quality arising from below average rainfall at the Simberi Oxide
Plant. The Company expects the build up inventories to be reversed
during the March 2011 quarter.
-- Average realised gold price of A$1,252 per ounce in 2010
compared to A$953 per ounce in 2009 (a favourable price variance of
A$4.9 million). The average realised gold price is net of
adjustments against revenue arising from the Group's hedge book.
Whilst the hedge book was paid out in February 2010, for accounting
purposes the hedging losses crystallised at that time are amortised
in accordance with the original maturity schedule of the hedge
book. The final maturity of the hedge book at the time of its
closure in February 2010 was December 31, 2010 and as such there
will be no further hedge accounting adjustments required for the
March 2011 and subsequent quarters.
-- Cost of sales of A$16,328,527 for the Quarter equates to
A$982 per ounce of gold sold compared to the Previous Quarter costs
of sales of A$18,575,931 or A$1,034 per ounce. Costs per ounce were
slightly lower in the Quarter notwithstanding an increase in the
ratio of waste mined to total ore mined from 0.32:1 in the Previous
Quarter to 0.81:1 and a reduction in head grade from 1.26 in the
Previous Quarter to 1.14 in the Quarter. The achievement of a
reduced cost per ounce in the Quarter notwithstanding the adverse
impacts on costs of the above factors reflects the cost
efficiencies that are being derived from the Simberi
debottlenecking initiatives. The increase in the waste ratio
reflected the need to access deeper ore bodies and was consistent
with current mine planning. It is expected that a ratio of 1:1 will
be maintained in future quarters.
-- Corporate expenses of A$2,449,247 in 2010 were significantly
lower than the corporate expenses of A$5,479,281 in 2009
notwithstanding an expanded corporate presence as a consequence of
the centralisation of a number of functions (purchasing, human
resources and training) following the acquisition of Australian
Solomons Gold. The reduction in costs was attributable to the
Previous Quarter costs including approximately A$1.8 million in
costs incurred as part of the acquisition of Australian Solomons
Gold as well as legal costs incurred in relation to the Intermet
dispute and costs associated with the listing of the allied Group
on the TSX.
-- In 2010 the cancellation of Executive compensation options
due to production based vesting conditions not being met result in
a write back of previously recognised share based compensation
expense in the amount of A$1,252,500. In the previous quarter share
based compensation expense was A$6,819,855.
-- In 2010 an amount of A$4,000,000 was recognised as financing
income in the Quarter pursuant to the derecognition of accruals
that were made by a subsidiary. Management considers that these
amounts were no longer required as at December 31, 2010.
Cash and cash flows for the Quarter compared to the Previous
Quarter
In the Quarter, Allied Gold reported a net decrease in cash and
cash equivalents of (A$36,050,733) compared to a net increase of
A$140,330 178 in cash and cash equivalents in the Previous Quarter.
The increased cash flow usage in the Quarter was primarily due
to:
-- Cash generated by operating activities of A$2,431,555 in the
Quarter compared to the Previous Quarter cash used by operating
activities of (A$7,607,972) due to:
- Due to termination of the hedge book in February 2010 all
sales in the Quarter realised cash proceeds based on the spot price
whereas in the Previous Quarter, 10,754 ounces of gold sold
realised cash proceeds at the hedge price of US$700 per ounce being
the hedge price. This resulted in approximately A$7.3 million of
additional cash proceeds in the Quarter (10,754 hedged ounces by
differential of approximately A$678 per ounce between hedge price
and average achieved spot price in 2010). In addition, in the
Previous Quarter approximately A$3 million of sales revenue had not
been received in cash even though the sales revenue was recognized
for accounting purposes.
- In the previous quarter cash costs of approximately A$3.5
million were incurred in relation to the acquisition of Australian
Solomons Gold and the listing of Allied Gold Limited on the
TSX.
-- Cash used by investing activities increased from (A$694,971)
in the Previous Quarter to (A$47,753,894) in the Quarter due
primarily to expenditure on property, plant and equipment in the
Quarter in relation to (i) debottlenecking and optimization
initiatives on Simberi Island of A$10 million (ii) expenditure of
A$1.1 million on the ongoing Sulphide Feasibility Study being
undertaken on Simberi Island (iii) capital expenditure on the Gold
Ridge redevelopment project of A$80 million (iv) capitalised
borrowing costs of approximately A$2.8 million. The Previous
Quarter also included A$3.6 million in cash acquired on the
acquisition of ASG.
-- Cash generated from financing activities decreased from
A$148,632,941 in the Previous Quarter to A$9,271,606in the Quarter.
In the Previous Quarter Allied Gold completed an equity raising for
A$150,293,558 (net of equity raising costs). In the Quarter the
Group drew down A$15,361 958 in financing proceeds through Bank of
the South Pacific; approximately a further A$20 million is
committed but undrawn under the Bank of the South Pacific
facility.
Six months ended December 31, 2010 as compared to six months
ended December 31, 2009
The tables below summarise the key financial and operating
statistics for Allied Gold's mining and processing activities for
the six months ended December 31, 2010 (Six Months), the six months
ended December 31, 2009 (Previous Six Months) and the year ended
June 30, 2010:
6 months ended 6 months ended
December 31, December 31, Year ended
2010 2009 June 30, 2010
Key financial statistic A$ A$ A$
Sales revenue 40,942,585 33,141,171 67,555,369
Gross margin 8,367,716 (5,009,648) (2,734,171)
Corporate expenses (4,950,553) (8,002,387) (14,773,680)
Share based remuneration 1,252,500 (6,819,755) (6,828,559)
Financial expenses (501,456) (1,839,198) (5,996,122)
Other expenses /(income) 5,220,785 (744,691) 40,561,347
-------------- -------------- --------------
Loss for the period 9,388,992 (22,415,679) 10,228,815
-------------- -------------- --------------
Cashflow from operations 7,856,534 (8,933,231) (20,509,398)
Cashflow from investing
activities (103,318,849) (6,592,836) (63,800,604)
Cashflow from financing
actiivites 46,437,202 151,091,597 148,677,057
-------------- -------------- --------------
Net cashflow (49,025,113) 135,565,530 64,367,055
-------------- -------------- --------------
Volume
6 months ended 6 months ended
Key operating Unit of December 31, December 31, Year ended
statistic measure 2010 2009 June 30, 2010
Waste
mined........
.............
.............
.............
.............
.............
.............
.............
... tonnes 1,063,224 223,095 634,296
Ore
mined........
.............
.............
.............
.............
.............
.............
.............
........ tonnes 1,249,785 962,489 1,981,500
Ore
processed....
.............
.............
.............
.............
.............
.............
.............
.... tonnes 1,153,504 972,121 1,949,650
Grade........
.............
.............
.............
.............
.............
.............
.............
............. grams of
... gold/tonne 1.11 1.14 1.18
Recovery.....
.............
.............
.............
.............
.............
.............
.............
............. % 89.9 88.1 87.9
Gold
produced.....
.............
.............
.............
.............
.............
.............
.............
... ounces 37,127 31,528 64,327
Gold
sold.........
.............
.............
.............
.............
.............
.............
.............
........ ounces 33,556 33,391 63,980
Allied Gold reported revenue of A$40,942,585 and a net profit of
A$9,388 992 or 0.80 cents per share for the Six Months, compared
with revenue of A$33,141,171 and a net loss of A$(22,415,679) or
(4.24) cents per share for the Previous Six Months ended December
31, 2009.
The results for the Six Months as compared to the Previous Six
Months reflect the following:
-- A higher level of production in the Six Months as production
for the Previous Six Months was impacted by nine lost days of
production as a result of an illegal cease work order in December
2009. The results for the Previous Six Months as compared to the
Six Months also reflect a lower level of production due to
unseasonal weather conditions.
-- Gold sales of 33,556 ounces in the Six Months were at an
average realized price (net of hedging adjustments) of A$1,220/oz
compared to gold sales of 33,391 oz in the Previous Six Months
which were at an average realized price of A$991/oz. Revenue from
gold sales increased by A$7,801,414 or approximately 24% due
primarily to the higher achieved gold prices in the six months.
-- Mining and processing volumes for the Six Months exceeded the
volumes achieved in the Previous Six Months, and resulted in gold
production increasing by 18% to 37,127 ounces. The improved mining
and processing throughput was principally as a result of the
Company's ongoing debottlenecking and optimisation initiatives.
-- Whilst gold production of 37,127 ounces in the Six Months
exceeded production of 31,528 ounces in the Previous Six Months,
the volume of gold sold was approximately the same in both periods
due to:
o A build up of gold in circuit of approximately 2,190 ounces
due to the adverse impact on the elution circuit of a deterioration
in water quality arising from below average rainfall at the Simberi
Oxide Plant. The Company expects the build up inventories to be
reversed during the March 2011 quarter.
o Gold produced but not shipped to the refinery as at December
31, 2010 totalling approximately 1,380 ounces. This gold was sold
in January 2011.
o asdlkjf
o A build up of gold in circuit of aply 2,190
-- The total cost per ounce of gold sold (including non cash
cost) in the Six Months was A$971 per ounce compared to A$1,210 in
the Previous Six Months. The reduction in total costs per ounce is
consistent with the largely fixed nature of the costs of the
Simberi Gold Project being spread over a larger production volume
in the Six Months.
-- Corporate expenses of A$4,950,553 in 2010 were significantly
lower than the corporate expenses of A$8,002,387 in 2009
notwithstanding an expanded corporate presence as a consequence of
the centralisation of a number of functions (purchasing, human
resources and training) following the acquisition of Australian
Solomons Gold. The reduction in costs was attributable to the
Previous Quarter costs included approximately A$1.8 million in
costs incurred as part of the acquisition of Australian Solomons
Gold as well as legal costs incurred in relation to the legal
action being take by Simberi against Intermet, the consulting
engineers for the construction of the Simberi plant and costs
associated with the listing of the Allied Group on the TSX.
-- In 2010 the cancellation of Executive compensation options
due to production based vesting conditions not being met result in
a write back of previously recognised share based compensation
expense in the amount of A$1,252,500. In the previous quarter share
based compensation expense was A$6,819,755.
-- In 2010 an amount of A$4,000,000 was recognised as financing
income in the Quarter pursuant to the derecognition of accruals
that were made by a subsidiary. Management considers that these
amounts were no longer required as at December 31, 2010.
-- In the Six Months, Allied Gold reported a net decrease in
cash and cash equivalents of A$49,025,113 compared to a net
increase in cash and cash equivalents of A$135,565,530 in the
previous Six Months. The increased cash usage in the Six Months was
primarily due to:
-- Proceeds from equity raisings of A$150,293,558 (net of
capital raising costs) in the Previous Six Months compared to debt
financing received in the Six Months totaling A$53,772,845 from
International Finance Corporation and Bank of South Pacific.
Cash provided by operating activities of A$7,856,534 in the Six
Months was higher than the Previous Six Months cash used in
operating activities of (A$8,933,231) due to higher realized AUD
gold revenue in the Six Months.
-- Cash used by investing activities increased from
(A$6,592,836) in the Previous Six Months to (A$103,318,849) in the
Six Months due primarily to capital expenditure on property, plant
and equipment in the Six Months in relation to the redevelopment of
the Gold Ridge Project.
Finance Activities, Liquidity and Capital Resources
Allied Gold's cash position as at December 31, 2010 consists of
A$36,486 444 in available cash and cash equivalents.
During the three years ended December 31, 2008 through December
31 2010, the Company has principally funded its activities through
equity raisings. The Company did not undertake any equity raisings
during the Quarter. In the Previous Quarter the Company completed
an equity raising for A$159,545,451.
The above mentioned equity raisings have been augmented by debt
from external financiers. In the three months ended December 31,
2010 the Group drew down the first tranche of A$15 million under a
facility provided to the Group by the Bank of the South Pacific
Limited. The facility is secured by a fixed and floating charge
over the assets of Simberi Gold Mining Limited and by a guarantee
provided by Allied Gold Limited. The funds drawn down are to be
utilised to meet the ongoing capital expenditure commitments of the
Allied Group. A further A$20 million is available to the Allied
Group under this facility and is expected to be utilized in the
March 2011 quarter.
The Company's financial commitments and contingent liabilities
are generally limited to controllable expenditures at the Simberi
Project and the Gold Ridge Redevelopment Project. The Company's
material financial commitments and contingent liabilities as of
December 31, 2010 are as follows:
-- Leases for office premises, operating leases for various
plant and machinery and payments for the charter of aircraft under
non-cancellable operating leases expiring within 1 to 5 years, in
the amount of A$2,129 368.
-- Commitments in relation to finance leases for the hire of
mining equipment expiring within 1 to 5 years, in the amount of
A$3,452,157. This amount includes the financing drawn down under
the Bank of the South Pacific facility referred to above.
-- A required expenditure of A$900,900 during the next year in
order to maintain current rights of tenure to EL 609. Financial
commitments for subsequent periods are contingent upon future
exploration results and cannot be estimated. These obligations are
subject to renegotiation upon expiry of EL 609 or when application
for a mining licence is made and have not been provided for in the
accounts.
-- Capital expenditure commitments of A$35,283,622 for the Gold
Ridge Project, A$695,286 for Simberi expansion and debottlenecking
projects and A$231,367 for the Simberi Sulphide pre-feasibility
study.
The above commitments are to be funded through existing cash
resources as at December 31, 2010, operating cash flows generated
from the Simberi Project and committed but undrawn finance
facilities with the Bank of the South Pacific.
Summary of Quarterly Results
31 Dec 30 Sep 30 Jun 31 Mar 31 Dec 30 Sep
10 10 10 10 09 09
A$ A$ A$ A$ A$ A$
Financial
metrics
Revenue 20,803,462 20,139,103 19,557,066 14,857,132 17,151,610 15,989,561
Income /
(loss) for
the
Quarter 8,316,214 1,072,778 36,082,387 (3,437,893) (16,443,427) (7,050,301)
Income /
(loss) per
share -
basic 0.80 0.10 34.68 (0.33) (2.78) (1.33)
Income /
(loss) per
share -
diluted 0.79 0.10 34.68 (0.33) (2.78) (1.33)
Operational
metrics
Ore mined 655,288 566,018 552,420 449,904 495,121 467,368
Ore
processed 583,031 570,473 544,317 439,318 482,865 489,256
Gold
produced 18,921 18,206 18,109 14,739 17,456 14,072
Gold sold 16,621 16,935 16,526 14,064 17,971 15,420
The three months ended September 30, 2009 was the first Quarter
in respect of which Allied was required to file a Quarterly report
as a reporting issuer.
The following are the key factors that have impacted the
Quarterly performance for the periods presented in the above
table:
-- The three months ended December 31, 2010 included a gain of
A$4,000 000 on the extinguishment of a liability for less than its
book value and a A$1,252,500 writeback of share based remuneration
expense in relation to Executive options that were cancelled due to
performance based vesting conditions attached to those options not
being satisfied.
-- The three months ended June 30, 2010 included a A$36,666,786
gain on the acquisition of Australian Solomons Gold Limited. If
this gain is excluded, the loss for the three months was
A$584,399.
-- The three months ended December 31, 2009 included share based
remuneration expense of A$6,819,755 and expenses totaling
A$1,717,915 that were incurred in relation to the acquisition of
Australian Solomons Gold Limited. If these amounts are excluded the
loss for the three months was A$7,905,757.
-- The three months ended March 31, 2010 showed significantly
lower production than the preceding and succeeding Quarters due to
approximately four direct lost days of production and a further
period of sub capacity as a result of an illegal cease work order
which directly impacted gold production for the Quarter and the
loss of a further eight days production during the Quarter
resulting from a structural mechanical failure of the Scrubber
Trommel processing equipment at the Simberi operations.
-- If the non recurring amounts and events described above are
excluded the Quarterly results demonstrate a continuing improvement
in both operational and financial metrics over the Quarters. This
improvement reflects the impact of the various efficiency and
optimization initiatives implemented to improve plant availability
and to reduce cash cost per ounce. Enhancements to plant design
have improved plant reliability and availability and have allowed
the plant to reach and maintain nameplate capacity consistently in
the June 2010, September 2010 and December 2010 Quarters.
-- It is expected that underlying profitability will be enhanced
commencing the March 2011 Quarter once the residual impact of the
Group's hedge book has dissipated. Whilst the hedge book was
terminated in February 2010, for accounting purposes the loss
realised on termination was amortised against profit until the
December 31, 2010 maturity of the hedge book.
Financial and Other Instruments
In the normal course of its operations, Allied Gold is exposed
to gold price, foreign exchange, interest rate, liquidity, equity
price and counterparty risks. In order to manage these risks, the
Company may enter into transactions which make use of both on and
off balance sheet derivatives. Allied Gold does not acquire, hold
or issue derivatives for trading purposes. The Company's management
of financial risks is aimed at ensuring that net cash flows are
sufficient to meet all its financial commitments as and when they
fall due and to maintain the capacity to fund its forecast project
development and exploration strategy by: (i) safeguarding the
Company's core earnings stream from its major asset through the
effective control and management of financial risk; (ii) effective
and efficient usage of credit facilities through the adoption of
reliable liquidity management planning and procedures; and (iii)
ensuring that investment and hedging transactions are undertaken
with creditworthy counterparts.
The Company may use derivative financial instruments to hedge
some of its exposure to fluctuations in gold prices and foreign
exchange rates.
In order to protect against the impact of falling gold prices,
the Company enters into hedging transactions which provide a
minimum price to cover non-discretionary operating expenses,
repayments due under the Company's financing facilities and
sustaining capital.
Pursuant to a US$25 million financing facility the Company
utilized for the construction of the Simberi Project, Allied Gold
was required by its lenders to enter into a hedging program to
provide comfort to its lenders of the cash flows going forward.
Subsequently in March 2009, Allied Gold repaid the entire project
financing facility. In February 2010 the Company settled its
remaining hedge obligations totaling 37,512 ounces of gold through
the pre delivery of gold into those hedging contracts.
For accounting purposes the "Effective Hedge" component of the
mark to market amounting to US$9.5 million was required to be
recorded in the Hedge Reserve and remained in equity at the time of
the termination of the agreement. These losses were amortised to
the income statement in accordance with the maturity profile of the
hedge book immediately prior to its termination. The "Ineffective
Hedge" component of the mark to market per the above table had been
recognised directly in the income statement progressively up to,
and including, 26 February 2010. As at December 31, 2010 the
"Ineffective Hedge" component had been fully recognised in the
income statement. The Effective Hedge component of the mark to
market was amortised to the income statement over the following
timeframe:
Hedging loss amortised to income statement
Quarter ending USD
------------------- -------------------------------------------
30 September 2010 2,738,137
31 December 2010 2,167,794
-------------------------------------------
4,905,931
-------------------------------------------
As at the date of this analysis, the Company's forecast
production is unhedged, allowing it to take advantage of increases
in gold prices.
The Company operates internationally and is exposed to foreign
exchange risk arising from various currency exposures primarily
with respect to the Papua New Guinea Kina, Solomon Islands dollar
and the United States Dollar. During the Quarter, the Company
entered into some intra Quarter forward exchange contracts to hedge
known commitments in Papua New Guinea Kina. There were no
outstanding forward exchange contracts as at December 31, 2010.
The Company's main interest rate risk arises from interest
earning cash deposits that expose the Company to interest rate
risk. No hedging programs were implemented by the Company to manage
interest rate risk during the Quarter.
The Company is exposed to equity securities price risk arising
from investments classified on the balance sheet as available for
sale. Investments in equity securities are approved by the Board on
a case-by-case basis. The majority of the Company's available for
sale equity investments are in junior resource companies listed on
the ASX.
The Company is exposed to counterparty risk being the risk that
a counterparty will not complete its obligations under a financial
instrument resulting in a financial loss for the Company. The
Company does not generally obtain collateral or other security to
support financial instruments subject to credit risk, but adopts a
policy of only dealing with credit worthy counterparties. Trade and
other receivables mainly comprise banking institutions purchasing
gold under normal settlement terms of two working days.
Counterparty risk under derivative financial instruments is to
reputable banking institutions. All significant cash balances are
on deposit with banking institutions that are members of highly
rated major Australian banking groups. The carrying amount of
financial assets recorded in the financial statements represents
the Company's maximum exposure to credit risk without taking
account of the value of any collateral or other security
obtained.
The Company's liquidity position is managed to ensure sufficient
liquid funds are available to meet its financial obligations in a
timely manner. The Company manages liquidity risk by continuously
monitoring forecast and actual cash flows and ensuring that the
Company has the ability to access required funding.
Off-Balance Sheet Arrangements
The Company had no off-balance sheet arrangements as at December
31, 2010.
Related Party Transactions
Remuneration (including fees and the issue of share options) was
paid or is payable to the directors of the Company in the normal
course of business. In addition, the Company had the following
related party transactions during the Quarter:
-- Mr. Caruso is a director and shareholder of MineSite
Construction Services Pty Ltd., which provides Allied Gold with
various services, including secretarial services, the supply or
procurement on behalf of Allied Gold of goods and services and the
provision of operating personnel. Amounts paid or payable to
MineSite Construction Services Pty Ltd. were A$116,631 in the
Quarter and A$2,209,519 in the Previous Quarter. The Previous
Quarter payments include leasing charges paid to Minesite
Constructon Services under a Dry Hire Agreement.
Director options and shareholdings
The table below provides summary movements in Directors' holding
of shares and options in the three months ended December 31,
2010
Options
Balance Balance
at start Granted as at end Vested and
of period remuneration Exercised Lapsed of year exercisable
M Caruso 33,875,000 - - (5,000,000) 28,875,000 25,875,000
M House 1,500,000 - - - 1,500,000 1,000,000
A Lowrie 1,750,000 - - - 1,750,000 1,250,000
G Steemson 1,750,000 - - - 1,750,000 1,250,000
F
Terranova 18,000,000 - - (2,500,000) 15,500,000 14,250,000
56,875,000 - - (7,500,000) 49,375,000 43,625,000
----------- ------------- ---------- ------------ ----------- ------------
In addition to the options shown above, the Board of Allied has
resolved to put to shareholders the issue of 1,500,000 unlisted
options to Mr Harvey at an exercise price of 50c expiring on 31
December 2011 with 1 000,000 vesting immediately and 500,000
vesting upon the share price trading at or above 70c for 5
consecutive days. The motion will be put to shareholders at the
Company's next general meeting of members.
Shares
Balance at Balance at
start of Received as Options Net change end of
Name period remuneration exercised other year
M Caruso 7,685,193 - - - 7,685,193
S Harvey 200,000 - - - 200,000
M House 10,000 - - - 10,000
A Lowrie 1,635,460 - - - 1,635,460
G Steemson 1,100,000 - - - 1,100,000
F
Terranova 1,000 - - - 1,000
10,631,653 - - - 10,631,653
----------- ------------- ----------- ----------- -----------
Significant Accounting Policies and Estimates
All costs associated with exploration, evaluation and
development of ML 136 and EL 609 have been capitalized as these
costs are expected to be recognized through the successful
development and exploitation of the Simberi Project. The carrying
value of non-current assets is reviewed regularly to ensure the
expected net Simberi Project cash flows exceed the carrying value.
Exploration costs on all projects are capitalized provided the
conditions and tests for capitalization, contained within
Australian IFRS accounting standards, are met.
The consolidated financial statements of the Company have been
prepared in accordance with Australian IFRS. A description of
Allied Gold's significant accounting policies is included in Note 1
to the audited consolidated financial statements of Allied Gold for
the year ended December 31, 2010. Management is required to make
various estimates and judgments in determining the reported amounts
of assets and liabilities, revenues and expenses for each period
represented and in the disclosure of commitments and contingencies.
Management considers the following are the accounting policies
which reflect its more significant estimates and judgments used in
the preparation of the consolidated financial statements.
Exploration and Evaluation Expenditure
Exploration and evaluation expenditure comprises costs that are
directly attributable to researching and analysing existing
exploration data; conducting geological studies, exploratory
drilling and sampling; examining and testing extraction and
treatment methods; and/or compiling prefeasibility and feasibility
studies. Exploration expenditure relates to the initial search for
deposits with economic potential. Evaluation expenditure arises
from a detailed assessment of deposits that have been identified as
having economic potential.
Exploration and evaluation expenditure (including amortisation
of capitalised licence costs) is charged to the income statement as
incurred except in the following circumstances, in which case the
expenditure may be capitalised:
-- The exploration and evaluation activity is within an area of
interest for which it is expected that the expenditure will be
recouped by future exploitation or sale; or
-- At the balance sheet date, exploration and evaluation
activity has not reached a stage which permits a reasonable
assessment of the existence of commercially recoverable
reserves.
-- Capitalized exploration and evaluation expenditure considered
to be tangible is recorded as a component of property, plant and
equipment at cost less impairment charges. Otherwise, it is
recorded as an intangible asset. As the asset is not available for
use, it is not depreciated. All capitalized exploration and
evaluation expenditure is monitored for indications of impairment.
Where a potential impairment is indicated, assessment is performed
for each area of interest in conjunction with the group of
operating assets (representing a cash generating unit) to which the
exploration is attributed. Exploration areas at which reserves have
been discovered that require major capital expenditure before
production can begin are continually evaluated to ensure that
commercial quantities of reserves exist or to ensure that
additional exploration work is under way or planned. To the extent
that capitalised expenditure is not expected to be recovered it is
charged to the income statement
-- Cash flows associated with exploration and evaluation
expenditure (comprising both amounts expensed and amounts
capitalised) are classified as investing activities in the cash
flow statement.
Development Expenditure
When proved reserves are determined and development is
justified, capitalised exploration and evaluation expenditure is
reclassified as "Other Mineral Assets", and is disclosed as a
component of property, plant and equipment. Development expenditure
is capitalised and classified as "Other Mineral Assets". The asset
is not depreciated until construction is completed and the asset is
available for use.
Foreign Currency
Foreign currency transactions are translated into Australian
dollars at exchange rates prevailing at the dates of such
transactions. Monetary assets and liabilities denominated in
foreign currencies at the balance sheet date are translated to
Australian dollars at the rate of exchange prevailing on that date.
Foreign exchange differences arising on translation are recognised
in the income statement. Non-monetary assets and liabilities that
are measured in terms of historical cost in a foreign currency are
translated using the exchange rate at the date of the transaction.
Non-monetary assets and liabilities denominated in foreign
currencies that are stated at fair value are translated to
Australian dollars at foreign exchange rates prevailing at the
dates the fair value was determined.
The assets and liabilities of foreign operations are translated
to Australian dollars at foreign exchange rates prevailing at the
balance sheet date. The revenue and expenses of foreign operations
are translated to Australian dollars at rates approximating the
foreign exchange rates ruling at the dates of the transaction.
Exchange differences arising on translation are recognised directly
in a separate component of equity.
Outstanding Securities Data
At the date of this MD&A, the Company has issued and
outstanding an aggregate of 1,040,032,142 ordinary shares and
59,950,000 options to acquire ordinary shares. No other securities
of Allied Gold are issued or outstanding. Details of movements in
Company's outstanding options during the three months ended
December 31, 2010 are as follows:
Options Options
outstanding Options outstanding
Exercise at July 1 Options expired or Options December 31
Price Maturity 2010 issued cancelled exercised 2010
------------- ----------- ------------ -------- ------------- ------------ ------------
A$0.80
options 31/12/2010 1,000,000 - (1,000,000) - -
A$1 options 31/12/2010 1,000,000 - (1,000,000) - -
A$1.25
options 31/12/2010 1,000,000 - (1,000,000) - -
A$1.50
options 31/12/2010 1,000,000 - (1,000,000) - -
A$2 options 31/12/2010 1,000,000 - (1,000,000) - -
A$0.35
options 31/10/2011 30,012,500 - (2,362,500) (375,000) 27,275,000
A$0.31
options 31/12/2010 1,699,427 - - (1,699,427) -
A$0.35
options 31/12/2011 1,500,000 - - - 1,500,000
A$0.50
options 31/12/2013 37,500,000 - (7,500,000) - 30,000,000
A$0.50
options 31/12/2013 1,175,000 - - - 1,175,000
------------ -------- ------------- ------------ ------------
76,886,927 - (14,862,500) (2,074,427) 59,950,000
------------ -------- ------------- ------------ ------------
Notes:
(i) Of the 27,275,000 options expiring 31 October 2011,
8,325,000 vest upon the share price trading at A$0.70 or above for
five consecutive days.
(ii) Of the 1,500,000 options expiring 31 December 2011, 500,000
vest upon the share price trading at A$0.70 or above for five
consecutive days.
(iii) All of the 31,175,000 options expiring 31 December 2013,
500,000 were fully vested as at December 31, 2010.
(iv) The weighted average exercise price of all options
outstanding at the end of the period was A$0.44.
(v) The weighted average time to expiry of all options
outstanding at the end of the period was 2.15 years.
Each option is convertible into one ordinary share in the
company when exercised. Options do not participate in dividends and
do not give holders voting rights.
Disclosure Controls and Procedures and Internal Controls over
Financial Reporting
The Company maintains appropriate information systems,
procedures and controls to ensure that information used internally
and disclosed externally is complete and reliable. The Company is
continuing to review and develop appropriate disclosure controls
and procedures and internal controls over financial reporting for
the nature and size of the Company's business.
Disclosure Controls and Procedures
The Company's disclosure controls and procedures ("DCP") are
designed to provide reasonable assurance that all relevant
information is communicated to the Company's senior management to
allow timely decisions regarding disclosure. Access to material
information regarding the Company is facilitated by the small size
of the Company's senior management team and workforce. The Company
is continuing to develop appropriate DCP for the nature and size of
the Company's business.
Internal Controls over Financial Reporting
Internal controls over financial reporting ("ICFR") are designed
to provide reasonable assurance regarding the reliability of the
Company's financial reporting and the preparation of financial
statements in compliance with Australian IFRS. The Board is
responsible for ensuring that management fulfills its
responsibilities in this regard. The Audit Committee fulfills its
role of ensuring the integrity of the reported information through
its review of the interim and annual financial statements. The
Chief Executive Officer and Chief Financial Officer, with
participation of the Company's management, have concluded that
there were no material weaknesses at the end of the Quarter or
changes to the Company's internal controls during the Quarter which
have materially affected, or are considered to be reasonably likely
to materially affect, the Company's ICFR.
Limitations of Controls and Procedures
The Company's management, including the Chief Executive Officer
and Chief Financial Officer, believe that any DCP or ICFR, no
matter how well conceived and operated, can provide only
reasonable, not absolute, assurance that the objectives of the
control system are met. Because of the inherent limitations in all
control systems, they cannot provide absolute assurance that all
control issues and instances of fraud, if any, within the Company
have been prevented or detected. These inherent limitations include
the realities that judgments in decision-making can be faulty, and
that breakdowns can occur because of simple error or mistake.
Additionally, controls can be circumvented by the individual acts
of some persons, by collusion of two or more people, or by
unauthorized override of the control. The design of any systems of
controls also is based in part upon certain assumptions about the
likelihood of future events, and there can be no assurance that any
design will succeed in achieving its stated goals under all
potential future conditions. Accordingly, because of the inherent
limitations in a cost effective control system, misstatements due
to error or fraud may occur and not be detected.
Risk factors
The Company is subject to a number of risk factors could
adversely affect the Company's future business, operations and
financial condition. For a discussion of risk factors which could
affect the Company, see the Company's Annual Information Form
available at www. sedar.com.
Cautionary Note Regarding Forward-Looking Statements
This MD&A contains "forward-looking statements" which may
include, but are not limited to, statements with respect to the
future financial or operating performance of Allied Gold, its
subsidiaries and their projects, the future price of gold, the
estimation of mineral reserves and resources, the realization of
mineral reserve estimates, the timing and amount of estimated
future production, costs of production, capital, operating and
exploration expenditures, costs and timing of the development of
new deposits, costs and timing of future exploration, requirements
for additional capital, government regulation of mining operations,
environmental risks, reclamation and rehabilitation expenses title
disputes or claims, limitations of insurance coverage and the
timing and possible outcome of pending litigation and regulatory
matters. Often, but not always, forward-looking statements can be
identified by the use of words such as "plans", "expects", "is
expected" "budget", "scheduled", "estimates", "forecasts",
"intends", "anticipates", or "believes", or variations (including
negative variations) of such words and phrases, or state that
certain actions, events or results "may", "could", "would",
"might", or "will" be taken, occur or be achieved. Forward-looking
statements involve known and unknown risks, uncertainties and other
factors which may cause the actual results, performance or
achievements of Allied Gold and/or its subsidiaries to be
materially different from any future results, performance or
achievements expressed or implied by the forward-looking
statements. Such factors include, among others, those factors
discussed in the section entitled "Risk Factors" in this short form
prospectus and the documents incorporated by reference herein.
Although Allied Gold has attempted to identify important factors
that could cause actual actions, events or results to differ
materially from those described in forward-looking statements,
there may be other factors that cause actions, events or results to
differ from those anticipated, estimated or intended.
Forward-looking statements contained herein are made based on the
opinions and estimates of management as at the date the statements
are made, and Allied Gold disclaims any obligation to update any
forward-looking statements except as required by law, whether as a
result of new information, estimates or opinions, future events or
results or otherwise. There can be no assurance that
forward-looking statements will prove to be accurate, as actual
results and future events could differ materially from those
anticipated in such statements. Accordingly, readers should not
place undue reliance on forward-looking statements.
Qualified Person
The Technical and Scientific information contained in this news
release was reviewed by Mr Colin Ross Hastings, MSc, BSc Geology,
M.Aus.I.M.M., Allied's General Manager Resource Development and the
Qualified Person as defined by National Instrument 43-101 of the
Canadian Securities Administrators responsible for the development
programs. Additionally Mr Hastings has sufficient experience which
is relevant to the style of mineralisation and type of deposit
under consideration and to the activity which he is undertaking to
qualify as a Competent Person as defined in the 2004 Edition of the
"Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves" Mr Hastings consents to the inclusion
of the information contained in this ASX release in the form and
context in which it appears. Mr Hastings is also a qualified person
as defined by Canadian National Instrument 43-101.
The information in this Stock Exchange Announcement that relates
to Mineral Exploration results, together with any related
assessments and interpretations, have been verified by and approved
for release by Mr P R Davies, MSc, BSc, M.Aus.I.M.M., a qualified
geologist and full-time employee of the Company. Mr Davies has
sufficient experience which is relevant to the style of
mineralisation and type of deposit under consideration and to the
activity which he is undertaking to qualify as a Competent Person
as defined in the 2004 Edition of the "Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore
Reserves". Mr Davies consents to the inclusion of the information
contained in this ASX release in the form and context in which it
appears. Mr Davies is also a qualified person as defined by
Canadian National Instrument 43-101.
Competent Persons
The information in this Stock Exchange Announcement that relates
to Mineral Exploration results and Mineral Resources, together with
any related assessments and interpretations, have been verified by
and approved for release by Mr P R Davies, MSc, BSc, M.Aus.I.M.M.,
a qualified geologist and full-time employee of the Company. Mr
Davies has sufficient experience which is relevant to the style of
mineralisation and type of deposit under consideration and to the
activity which he is undertaking to qualify as a Competent Person
as defined in the 2004 Edition of the "Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore
Reserves". Mr Davies consents to the inclusion of the information
contained in this ASX release in the form and context in which it
appears. Mr. Davies is also a Qualified Person as defined by
Canadian National Instrument 43-101.
Glossary of terms used in the Announcement:
A 'Mineral Resource' is a concentration or occurrence of
material of intrinsic economic interest in or on the Earth's crust
in such form, quality and quantity that there are reasonable
prospects for eventual economic extraction. The location, quantity,
grade, geological characteristics and continuity of a Mineral
Resource are known, estimated or interpreted from specific
geological evidence and knowledge. Mineral Resources are
sub-divided, in order of increasing geological confidence, into
Inferred, Indicated and Measured categories.
An 'Inferred Mineral Resource' is that part of a Mineral
Resource for which tonnage, grade and mineral content can be
estimated with a low level of confidence. It is inferred from
geological evidence and assumed but not verified geological and/or
grade continuity. It is based on information gathered through
appropriate techniques from locations such as outcrops, trenches,
pits, workings and drill holes which may be limited or of uncertain
quality and reliability.
An 'Indicated Mineral Resource' is that part of a Mineral
Resource for which tonnage, densities, shape, physical
characteristics, grade and mineral content can be estimated with a
reasonable level of confidence. It is based on exploration,
sampling and testing information gathered through appropriate
techniques from locations such as outcrops, trenches pits, workings
and drill holes. The locations are too widely or inappropriately
spaced to confirm geological and/or grade continuity but are spaced
closely enough for continuity to be assumed.
A 'Measured Mineral Resource' is that part of a Mineral Resource
for which tonnage, densities, shape, physical characteristics,
grade and mineral content can be estimated with a high level of
confidence. It is based on detailed and reliable exploration,
sampling and testing information gathered through appropriate
techniques from locations such as outcrops, trenches, pits,
workings and drill holes. The locations are spaced closely enough
to confirm geological and grade continuity.
Tonnage - An expression of the amount of material of interest
irrespective of the units of measurement (which should be stated
when figures are reported)
Grade - Any physical or chemical measurement of the
characteristics of the Analysis (Value) material of interest in
samples or product
Cut off grade - The lowest grade, or quality, of mineralised
material that qualifies as economically mineable and available in a
given deposit. May be defined on the basis of economic evaluation,
or on physical or chemical attributes that define an acceptable
product specification.
Mineralisation - Any single mineral or combination of minerals
occurring in a mass, or deposit, of economic interest.
Assay - The proportion of a particular metal (eg Au and Ag) in a
sample derived by laboratory analytical techniques.
Analysis limits of detection for Au is <0.01 g/t. Au assays
are determined by a 50gm fire assay and an AAS (Atomic Adsorption
Spectrometry) finish. Any interval recorded as being below
detection has been recorded in the database as having a grade of
half the detection limit, which in this case is 0.005 g/t. The Ag
detection limit is 0.2g/t and is derived from a 0.5g charge
Aquaregia digest, with assay via ICP (Induced Coupled Plasma)
AES.
Mineralisation types are:
Oxide - extremely weathered material (cyanide leach recoveries
> 90%), 0.5 g/t Au cutoff
Transitional - distinctly weathered material (cyanide leach
recoveries 50-90%), 0.5 g/t Au cutoff
Sulphide - Slightly weathered to fresh material (cyanide leach
recoveries generally <50%), 0.5 or 1.0 g/t Au cutoff
Ounce - 1 troy ounce = 31.10348 grams
Tonnes - Are estimated on a dry basis and defined as a
measurement of mass equal to 1000kg which is equivalent to 2204.622
pounds.
Tuff - A rock composed of pyroclastic materials that have been
ejected from a volcano. In many instances these fragments are still
hot when they land, producing a "welded" rock mass.
Mineral Resource estimate - An estimate of tonnage and grade
(mineral content) of a deposit by a variety of techniques including
geometrical classical methods and or geostatistical methods.
Mt - Million Tonnes
Moz - Million Ounces
Andesite - A fine-grained, extrusive igneous rock composed
mainly of plagioclase with other minerals such as hornblende,
pyroxene and biotite.
Ordinary kriging (OK) - is a geostatistical approach to
modeling. Instead of weighting nearby data points by some power of
their inverted distance, OK relies on the spatial correlation
structure of the data to determine the weighting values. This is a
more rigorous approach to modeling, as correlation between data
points determines the estimated value at an unsampled point.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE SIX MONTHS ENDED DECEMBER 31, 2010
Year to
3 months 3 months date Year to date
December December December December 31,
Note 31, 2010 31, 2009 31, 2010 2009
Revenue 20,803,482 17,151,610 40,942,585 33,141,171
Cost of sales (16,328,527) (18,575,931) (32,574,869) (38,150,819)
------------- ------------- ------------- -------------
Gross profit 4,474,955 (1,424,321) 8,367,716 (5,009,648)
Unrealised losses
on derivatives - (1,944,294) - (812,476)
Corporate expenses (2,449,247) (5,479,281) (4,950,553) (8,002,387)
Share based
remuneration 12 1,252,500 (6,819,755) 1,252,500 (6,819,755)
Foreign exchange
gain / (loss) 930,519 181,344 444,063 (112,698)
Financial income 6 4,255,051 115,522 4,776,722 180,483
Financial costs (147,564) (1,072,642) (501,456) (1,839,198)
------------- ------------- ------------- -------------
Profit / (loss)
from continuing
operations 8,316,214 (16,443,427) 9,388,992 (22,415,679)
Income tax
benefit/(expense) - - - -
------------- ------------- ------------- -------------
Loss for the
period 8,316,214 (16,443,427) 9,388,992 (22,415,679)
Other
comprehensive
income / (loss)
Changes in the
fair value of
available for
sale financial
assets 335,995 253,083 543,795 250,914
Changes in the
fair value of
cash flow hedges
- gross - (4,305,218) - (5,774,881)
Transfers to
income statement
from cash flow
hedging reserve -
gross 2,420,134 5,772,406 5,437,338 4,917,149
Exchange
differences on
translation of
foreign
operations - 1,255,526 - 1,141,391
Other
comprehensive
income / (loss)
for the period 2,756,129 2,975,797 5,981,133 534,573
------------- ------------- ------------- -------------
Total
comprehensive
income / (loss)
for the period 11,072,343 (13,467,630) 15,370,125 (21,881,106)
------------- ------------- ------------- -------------
Profit / (loss)
for the period is
attributable to:
Owners of Allied
Gold Limited 8,316,214 (16,430,456) 9,388,992 (22,402,708)
Non-controlling
interest - (12,971) - (12,971)
------------- ------------- ------------- -------------
8,316,214 (16,443,427) 9,388,992 (22,415,679)
------------- ------------- ------------- -------------
Total
comprehensive
income / ( loss)
for the period is
attributable to:
Owners of Allied
Gold Limited 11,072,343 (13,416,189) 15,370,125 (21,829,665)
Non-controlling
interest - (51,441) - (51,441)
------------- ------------- ------------- -------------
11,072,343 (13,467,630) 15,370,125 (21,881,106)
------------- ------------- ------------- -------------
Basic earnings per 0.80 (2.78) 0.90 (4.24)
share (cents) 0.79 (2.78) 0.89 (4.24)
Diluted earnings
per share
(cents)
The accompanying notes are an integral part of these interim
consolidated financial statements.
CONSOLIDATED BALANCE SHEET
AS AT DECEMBER 31, 2010
December June 30
Note 31 2010 2010
CURRENT ASSETS
Cash and cash equivalents 36,486,444 85,525,391
Trade and other receivables 4,099,013 4,160,718
Inventories 21,328,397 11,795,370
Other assets 1,492,322 3,066,675
----------------------- -------------
Total Current Assets 63,406,176 104,548,154
----------------------- -------------
NON-CURRENT ASSETS
Available for sale financial
assets 1,068,024 524,230
Property, plant and equipment 7 375,679,424 302,874,641
Exploration and evaluation
expenditure 8 25,421,216 23,711,261
Total Non-Current Assets 402,168,664 327,110,132
----------------------- -------------
Total Assets 465,574,840 431,658,286
----------------------- -------------
CURRENT LIABILITIES
Trade and other payables 14,379,497 44,032,012
Borrowings 9 11,517,869 4,481,970
Provisions 10 1,170,332 1,008,116
----------------------- -------------
Total Current Liabilities 27,067,698 49,522,098
----------------------- -------------
NON CURRENT LIABILITIES
Borrowings 9 42,866,750 1,755,820
Provisions 10 9,799,544 9,315,217
----------------------- -------------
Total Non-Current Liabilities 52,666,294 11,071,037
----------------------- -------------
Total Liabilities 79,733,992 60,593,135
----------------------- -------------
NET ASSETS 385,840,848 371,065,151
----------------------- -------------
EQUITY
Issued capital 11 370,183,255 369,525,183
Reserves 21,828,055 17,099,422
Accumulated losses (6,170,462) (15,559,454)
----------------------- -------------
Total equity 385,840,848 371,065,151
----------------------- -------------
The accompanying notes are an integral part of these interim
consolidated financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE HALF-YEAR ENDED 31 DECEMBER, 2010
Available
Foreign for sale
Share-based exchange investments Cash Flow
Issued Accumulated payments translation revaluation Hedging
Capital Losses reserve reserve reserve Reserve Total
$ $ $ $ $ $ $
At 1 July 2010 369,525,183 (15,559,454) 16,604,976 5,427,787 503,997 (5,437,338) 371,065,151
Total
comprehensive
income for the
period
Profit for the
period - 9,388,992 - - - - 9,388,992
Changes in the
fair value of
available for
sale
financial
assets - - - - 543,795 - 543,795
Transfers to
income
statement
from cash
flow hedging
reserve -
gross - - - - - 5,437,338 5,437,338
- 9,388,992 - - 543,795 5,437,338 15,370,125
Transactions
with equity
holders in
their capacity
as equity
holders
Transfer value
of forfeited
options
previously
recognised - - (1,252,500) - - - (1,252,500)
Exercise of
options 658,072 - - - - - 658,072
------------ ------------- ------------ ------------ ------------ ------------ ------------
658,072 - (1,252,500) - - - (594,428)
At 31 December
2010 370,183,255 (6,170,462) 15,352,476 5,427,787 1,047,792 - 385,840,848
------------ ------------- ------------ ------------ ------------ ------------ ------------
The accompanying notes are an integral part of these interim
consolidated financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE HALF-YEAR ENDED 31 DECEMBER, 2009
Available
Foreign for sale
Share-based exchange investments Cash Flow
Issued Accumulated payments translation revaluation Hedging
Capital Losses reserve reserve reserve Reserve Total
$ $ $ $ $ $ $
At 1 July 2009 173,098,363 (24,257,420) 9,776,417 (644,628) 136,389 (8,068,638) 150,040,483
Total
comprehensive
income for the
period
Loss for the
period - (22,415,679) - - - - (22,415,679)
Changes in the
fair value of
available for
sale
financial
assets - - - - 250,914 - 250,914
Changes in the
fair value of
cash flow
hedges -
gross - - - - - (5,774,881) (5,774,881)
Transfers to
net profit -
gross - - - - - 4,917,149 4,917,149
Exchange
differences
on
translation
of foreign
operations - - - 1,141,391 - - 1,141,391
- (22,415,679) - 1,141,391 250,914 (857,732) (21,881,106)
Transactions
with equity
holders in
their capacity
as equity
holders
Ordinary
shares
issued 205,906,932 - - - - - 205,906,932
Costs of
equity
raising (9,251,893) - - - - - (9,251,893)
Share based
payments - - 6,792,058 - - - 6,792,058
Conversion of
options 157,500 - - - - - 157,500
------------ ------------- ------------ ------------ ------------ ------------ -------------
196,812,539 - 6,792,058 - - - 203,604,597
At 31 December
2009 369,910,902 (46,673,099) 16,568,475 496,763 387,303 (8,926,370) 331,763,974
------------ ------------- ------------ ------------ ------------ ------------ -------------
The accompanying notes are an integral part of these interim
consolidated financial statements.
CONSOLIDATED CASHFLOW STATEMENT
FOR THE SIX MONTHS ENDED DECEMBER 31, 2010
Year to
3 months 3 months date Year to date
December December December December 31,
Note 31, 2010 31, 2009 31, 2010 2009
CASH FLOWS
FROM
OPERATING
ACTIVITIES
Receipts from
customers 22,248,910 19,539,234 46,524,256 33,166,504
Payments to
suppliers &
employees (16,824,386) (27,592,617) (36,142,541) (42,260,483)
Interest received 172,423 178,099 694,094 178,099
Interest paid (3,165,392) 267,492 (3,219,275) (17,351)
------------- ------------- -------------- -------------
Net cash from /
(used in) operating
activities 2,431,555 (7,607,792) 7,856,534 (8,933,231)
------------- ------------- -------------- -------------
CASH FLOWS
FROM
INVESTING
ACTIVITIES
Purchase of plant
& equipment (43,971,108) (2,835,694) (98,088,171) (7,201,607)
Development
expenditure (3,520,723) (482,840) (3,520,723) (2,014,792)
Exploration and
evaluation
expenditure (262,063) (950,364) (1,709,955) (950,364)
Cash acquired on
acquisition of
controlled entity - 3,573,927 - 3,573,927
Net cash used in
investing
activities (47,753,894) (694,971) (103,318,849) (6,592,836)
------------- ------------- -------------- -------------
CASH FLOWS
FROM
FINANCING
ACTIVTIES
Proceeds from issue
of shares - 159,545,451 - 159,545,451
Costs of issuing
securities - (9,251,893) - (9,251,893)
Proceeds from
exercising options 658,072 - 658,072 -
Finance lease
payments (463,486) (1,433,037) (948,576) (2,534,784)
Proceeds from
borrowings 15,361,958 (227,580) 53,772,845 3,332,823
Repayments of
borrowings (6,284,938) - (7,045,139) -
------------- ------------- -------------- -------------
Net cash from
financing
activities 9,271,606 148,632,941 46,437,202 151,091,597
------------- ------------- -------------- -------------
Net (decrease) /
increase in cash
held (36,050,733) 140,330,178 (49,025,113) 135,565,530
Cash at beginning
of the period 72,047,976 15,700,650 85,525,391 20,529,979
Effects of exchange
rate changes on the
balance of cash and
cash equivalents 489,201 1,210,700 (13,834) 1,146,019
------------- ------------- -------------- -------------
Cash and cash
equivalents at end
of the period 36,486,444 157,241,528 36,486,444 157,241,528
------------- ------------- -------------- -------------
The accompanying notes are an integral part of these interim
consolidated financial statements.
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL REPORT
1. Reporting entity
Allied Gold Limited ("the Company") is a company incorporated in
Australia and limited by shares, which are publicly traded on the
Australian Stock Exchange, the Toronto Stock Exchange and on AIM, a
market operated by the London Stock Exchange plc. The interim
consolidated financial report for the half-year ended 31 December,
2010 comprises the Company and its controlled entities (together
referred to as "the Group").
The consolidated annual report of the Group as at and for the
year ended 30 June, 2010 is available upon request from the
Company's registered office at Unit B9, 431 Roberts Road, Subiaco
WA 6008.
2. Statement of compliance
The interim consolidated financial report is a general-purpose
financial report, which has been prepared in accordance with the
requirements of the Corporations Act 2001 and AASB 134 Interim
Financial Reporting. The interim consolidated financial report
complies with Australian Accounting Standards, which include
Australian equivalents to International Financial Reporting
Standards ('AIFRS') as they pertain to interim financial
reports.
The group financial statements of Allied Gold Limited also
comply with International Financial Reporting Standards ("IFRS") as
issued by the International Accounting Standards Board
("IASB").
The interim consolidated financial report does not include all
of the information required for a full annual financial report and
should be read in conjunction with the annual financial report of
the Group as at and for the year ended 30 June 2010 and should be
considered together with any public announcements made by the
Company during the half-year ended 31 December, 2010 in accordance
with the continuous disclosure requirements applicable in the
jurisdictions in which the Company's shares are traded.
3. Significant accounting policies
The significant accounting policies applied by the Group in this
interim consolidated financial report are the same as those applied
by the Group in its consolidated financial report as at and for the
year ended 30 June 2010.
4. Estimates
The preparation of the interim consolidated financial report in
accordance with Australian Accounting Standards requires management
to make judgements, estimates and assumptions that affect the
application of policies and reported amounts of assets,
liabilities, income and expenses. These estimates and associated
assumptions are based on historical experience and various other
factors that are believed to be reasonable under the circumstances,
the results of which form the basis of making the judgements about
the carrying values of assets and liabilities that are not readily
apparent from other sources. Actual results may differ from these
estimates.
In preparing this interim consolidated financial report, the
significant judgements made by management in applying the Group's
accounting policies and the key sources of estimation uncertainty
were the same as those that applied to the consolidated annual
financial report as at and for the year ended 30 June 2010.
5. Segment reporting
Management has determined that the operating segments based on
reports reviewed by the Executive Chairman and the Chief Financial
Officer that are used to monitor performance and make strategic
decisions. The business is considered from both a geographic and
functional perspective and has identified four reportable
segments.
Papua New Guinea consists of mining and processing and mineral
exploration activities undertaken at the Simberi project. Solomon
Islands also consists of mining and processing and mineral
exploration activities. As the project is not currently in
production, all costs related to the Solomon Islands project are
capitalised for financial reporting purposes. The performance of
the two geographic sectors is monitored separately.
The segment information presented to the Executive Chairman and
the Chief Financial Officer does not include reporting of assets
and liabilities or cash flows by segment.
2010 Papua New Guinea Solomon Islands Consolidated
Mining and Mineral Mining and Mineral Mining and Mineral
Processing Exploration Total Processing Exploration Total Processing Exploration Total
$ $ $ $ $ $ $ $ $
Revenue
Sales to
external
customers 40,942,585 - 40,942,585 - - - 40,942,585 - 40,942,585
----------- ------------ ----------- ------------- ------------ ------------- ------------ ------------ ------------
Result
Segment
contribution 8,367,716 (3,979,595) 4,388,121 (13,106,310) (514,370) (13,620,680) (4,738,594) (4,493,965) (9,232,559)
----------- ------------ ----------- ------------- ------------ ------------- ------------ ------------ ------------
1In Papua New Guinea the mineral exploration costs are
capitalised for financial reporting in accordance with Australian
Accounting Standards. In the Solomon Islands both Mining and
Processing and Mineral Exploration costs were capitalised for
financial reporting in accordance with Australian Accounting
Standards
Solomon
2009 Papua New Guinea Islands Consolidated
Mining and Mineral Mineral Mining and Mineral
Processing Exploration Total Exploration Processing Exploration Total
$ $ $ $ $ $ $
Revenue
Sales to
external
customers 33,141,171 - 33,141,171 - 33,141,171 - 33,141,171
------------ ------------ ------------ ------------ ------------ ------------ ------------
Result
Segment
contribution (5,009,648) (2,014,792) (7,024,440) (1,364,790) (5,009,648) (3,379,582) (8,389,230)
------------ ------------ ------------ ------------ ------------ ------------ ------------
The Executive Chairman and the Chief Financial Officer assess
the performance of the operating segments based on a measure of
contribution. This measure excludes items such as the effects of
equity settled share based payments, and unrealised gains /
(losses) on financial instruments. Interest income and expenditure
are not allocated to segments, nor are corporate expenses as these
activities are centralised.
Half-year to 31 December
2010 2009
Segment contribution (9,232,559) (8,389,230)
Capitalised expenditure 17,600,275 3,379,583
Unrealised loss on derivatives - (812,477)
Corporate expenses (4,950,553) (8,002,387)
Share based remuneration 1,252,500 (6,819,755)
Foreign exchange gain / (loss) 444,063 (112,698)
Financial income 4,776,722 180,483
Financial costs (501,456) (1,839,198)
------------ -------------
Profit / (loss) from continuing operations 9,388,992 (22,415,679)
------------ -------------
6. Financial income
Included in financial income for the half year ended 31 December
2010 is an amount of $4,000,000 being income derived by the Group
as a consequence of settling a financial liability for less than
its book value.
7. Property plant and equipment
Half-year to 31 December
2010 2009
Cost
Balance at 1 July 343,127,332 171,632,992
Acquired on acquisition of ASG - 3,773,602
Additions 78,996,315 9,216,494
------------- -------------
Balance at 31 December 422,123,647 184,623,088
------------- -------------
Accumulated depreciation
Balance at 1 July (40,252,691) (25,771,283)
Depreciation (6,191,532) (6,377,730)
------------- -------------
Balance at 31 December (46,444,223) (32,149,013)
------------- -------------
Net book value 375,679,424 152,474,075
------------- -------------
Balance at
December
31 June 30
2010 2010
Cost 422,123,647 343,127,332
Accumulated Depreciation (46,444,223) (40,252,691)
------------- -------------
Net book value 375,679,424 302,874,641
------------- -------------
Included in property assets capitalised under finance leases of
$18,157 134 (half-year ended 31 December, 2009: $3,560,403).
Included in property plant and equipment are assets under
construction amounting to $150,192,041 (half year ended 31
December, 2009: $16,580 763).
8. Exploration and evaluation expenditure
Half-year to 31 December
2010 2009
Cost
Balance at 1 July 23,711,261 11,115,743
Acquired on acquisition of ASG - 46,505,725
Additions 1,709,955 -
Effect of exchange rates - 2,293,237
------------- ------------
Balance at 31 December 25,421,216 59,914,705
------------- ------------
9. Borrowings
The following table sets out the movements in borrowings during
the half-year:
Half-year to 31 December
2010 2009
$ $
Balance at 1 July 6,237,790 5,940,368
New Issues
Finance lease liabilities (PGK and AUD) 15,361,958 3,332,823
Secured bank loan (USD) 38,410,887 -
Effects of foreign exchange (2,562,377) 192,962
Unsecured loans (AUD) 1,147,771 -
Repayments
Finance lease liabilities (PGK and AUD)
- principal component of repayments (766,395) (1,462,521)
Unsecured loans (AUD) (3,445,015) -
------------- ------------
Balance at 31 December 54,384,619 8,003,632
------------- ------------
1 Interest on the secured bank loan will be capitalised until
the construction of the Gold Ridge mine is completed.
10. Provisions
Half-year
to 31 December
2010 2009
Current $ $
Employee entitlements 1,170,332 868,260
---------- ----------
Non Current
Employee entitlements - 60,448
Rehabilitation and restoration 9,799,544 7,715,851
---------- ----------
9,799,544 7,776,299
---------- ----------
Movements in the provision for rehabilitation and restoration
during the half-year are set out below:
Half-year
to 31 December
2010 2009
Cost
Balance at 1 July 9,315,217 2,782,426
Acquired on acquisition of ASG - 4,679,737
Accrual of discount and effect of exchange
rates 484,327 253,688
---------- ----------
Balance at 31 December 9,799,544 7,715,851
---------- ----------
11. Contributed equity
(a) Ordinary shares
2010 2009 2010 2009
Number of Number of
shares shares $ $
Ordinary shares 1,042,206,569 1,036,712,735 370,183,255 369,910,902
============== ============== ============ ============
Balance at 1 July 1,040,132,142 472,643,276 369,525,183 173,098,363
Shares issued
through capital
raising - 456,699,000 - 159,387,951
Shares issued on
the conversion
of options 2,074,427 450,000 658,072 157,500
Shares issued to
acquire
controlled
entity - 106,920,459 - 46,518,981
370,183,255 379,162,795
Costs of capital
raising - (9,251,893)
-------------- -------------- ------------ ------------
Balance at 31
December 1,042,206,569 1,036,712,735 370,183,255 369,910,902
-------------- -------------- ------------ ------------
Ordinary shares entitle the holder to one vote per share and to
participate in dividends and proceeds on winding up of the company
in proportion to the number of and amounts paid on the shares
held.
(b) Options
The table below sets out the movements in options during the
half-year:
Options
Options outstanding
outstanding Options at 31
Exercise at 1 July Options expired or Options December
Price Maturity 2010 issued cancelled exercised 2010
------------ ----------- ------------ -------- ------------- ------------ ------------
$0.80
options 31/12/2010 1,000,000 - (1,000,000) - -
$1 options 31/12/2010 1,000,000 - (1,000,000) - -
$1.25
options 31/12/2010 1,000,000 - (1,000,000) - -
$1.50
options 31/12/2010 1,000,000 - (1,000,000) - -
$2 options 31/12/2010 1,000,000 - (1,000,000) - -
$0.35
options 31/10/2011 30,012,500 - (2,362,500) (375,000) 27,275,000
$0.31
Options 31/12/2010 1,699,427 - - (1,699,427) -
$0.35
Options 31/12/2011 1,500,000 - - - 1,500,000
$0.50
Options 31/12/2013 37,500,000 - (7,500,000) - 30,000,000
$0.50
options 31/12/2013 1,175,000 - - - 1,175,000
------------ -------- ------------- ------------ ------------
76,886,927 - (14,862,500) (2,074,427) 59,950,000
------------ -------- ------------- ------------ ------------
Notes:
(vi) Of the 27,275,000 options expiring 31 October 2011,
8,325,000 vest upon the share price trading at $A0.70 or above for
five consecutive days.
(vii) Of the 1,500,000 options expiring 31 December 2011,
500,000 vest upon the share price trading at $A0.70 or above for
five consecutive days.
(viii) The 31,175,000 outstanding options expiring 31 December
2013, had all vested as at 31 December 2010.
(ix) 7,500,000 options were forfeited during the period as the
vesting conditions were not met.
Each option is convertible into one ordinary share in the
company when exercised. Options do not participate in dividends and
do not give holders voting rights.
12. Share based payments
In 2006, the group established a share option program that
entitles key management personnel and senior employees to purchase
shares in the entity. The terms and conditions of the share option
programme are disclosed in the consolidated financial report as at
and for the year ended June 30, 2010.
During the six-month period ended 30 June 2010 an amount of
$1,252,500 was transferred from the share based payment reserve to
the Statement of Comprehensive Income to reverse the value of
options previously expensed that were forfeited during the period
due to vesting conditions not being met.
13. Related party transactions
Arrangements with related parties continue to be in place. The
nature and terms of transactions with related parties are
consistent with those described in the consolidated financial
report for the year ended 30 June, 2010.
14. Commitments and contingencies
Except for the matter noted below, there has been no significant
change to the Group's commitments and contingencies since 30 June
2010.
As at 31 December 2010 a member of the group was pursuing an
insurance claim in respect of an item of equipment that was
previously leased under the Dry Hire Agreement with Minesite
Construction Services Pty Ltd a related party of which Mr Mark
Caruso is a director, which was terminated on 1 April 2010.
Dependent on the outcome of the insurance claim, the Group may be
required to meet some or all of the amounts being claimed. The
group's maximum exposure under the claim is estimated to be
$400,000.
15. Subsequent events
No matter or circumstance has arisen since 31 December 2010 that
has significantly affected, or may significantly affect:
a. The Group's operations in future financial years, or
b. The results of those operations in future financial years,
or
c. The Group's state of affairs in future financial years.
A copy of the full reports can be viewed and downloaded on the
Company's website www.alliedgold.com.au and as a link to this
announcement
For further information, contact:
Simon Jemison Investor Relations & Media + 61 0418 853
922
Rebecca Greco Investor Relations, North America +1 416 839
8610
David Simonson c/. Merlin PR +44 20 7726 8400
Beaumont Cornish Limited
Roland Cornish
Beaumont Cornish Limited
T: +44 (0) 20 7628 3396
This information is provided by RNS
The company news service from the London Stock Exchange
END
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