RNS Number:2867C
Zambezi Nickel Ltd
17 August 2007
17th August 2007
Zambezi Nickel Limited
("ZNI" or the "Company")
Final results for year ended 31 March 2007
Zambezi Nickel Limited (AIM: ZNI) the Aim-quoted African nickel and uranium
exploration and development company, today announces its preliminary results for
the year ended 31 March 2007.
Highlights:
* Nickel sulphides discovered at Mavita project, Mozambique
* 5,166 metres of diamond drilling completed at the Mitaba Hills nickel
project in Zambia
* Mr Jim Kerr appointed Managing Director
Nickel Projects
The Company's main focus during the reporting year was the Mitaba Hill project
in Zambia, where the Company completed 5,166 metres of diamond drilling,
geophysical surveys, mapping and geochemical sampling exploring for nickel
mineralisation.
Work also commenced on the Mavita project in Mozambique, where the Company
completed a major geophysical survey, regional stream sediment geochemical
surveys and mapping, which resulted in the discovery of nickel anomalies up to
1264ppm Ni. In addition, nickel sulphides in outcrop were discovered that
assayed up to 5500ppm Ni.
Post Balance Sheet Events
In May 2007, the Company placed 40,000,000 shares at 5p each to raise
#2,000,000 to fund ongoing exploration efforts in Zambia and Mozambique.
Uranium Projects
Since the year end, the Company has, in May, signed Heads of Agreement with
Zambezi Resources Ltd ("Zambezi Resources") to acquire 51% of the uranium rights
over four granted exploration licences in Zambia that includes the Oryx uranium
prospect. The Oryx radiometric anomaly was discovered by Zambezi Resources in
2005 through the completion of a regional airborne magnetic and radiometric
survey. Subsequent exploration identified surface accumulations of the
uranium-rich mineral davidite, which has assayed up to 6.44% U3O8.
Zambezi Nickel has commenced exploration over Oryx and other radiometric
anomalies with reconnaissance spectrometer and scintillometer traverses
currently underway as well as rock chip and soil sampling.
Directorate Changes
On 15 January 2007, Mr Jim Kerr was appointed Managing Director of the Company.
In addition, after the year end on 23 May 2007, Mr David Lunt joined the Company
as a non-executive director.
Commenting on the announcement Jim Kerr, Managing Director of Zambezi Nickel
said, "We are pleased to report the Company's progress over the period and are
excited about the potential of our nickel and uranium targets currently being
explored."
The 2007 Annual Report will be available on the Zambezi Nickel Website at
www.zambezinickel.com.
Extracts from the audited consolidated financial statements are attached below.
For more information contact
Jim Kerr, Zambezi Nickel Limited Tel: +61 8 9216 9000
David Youngman, WH Ireland Limited Tel: +44 161 832 2174
Jos Simson/Jane Stacey Conduit PR Tel: +44 207 429 6603
The information in this report that relates to Exploration Results is based on
information compiled by Non Executive Director Geoffrey Johnson BSc (Hons), PhD,
Grad Dip Env Sc. and Mr Jim Kerr, BSc (Geol), MSc (Min Econ), AWASM, MSEG. Dr
Johnson is a Fellow of the Australian Institute of Geoscientists and Mr Kerr is
a Member of the Australasian Institute of Mining and Metallurgy and both are
Competent Persons as defined in the Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserve. They consent to the
inclusion in the report of the matters based on the information in the form and
context in which it appears.
FINANCIALS
The following extracts of the audited consolidated financial statements for the
year ended 31 March 2007 are listed below:
* Chairman's Statement
* Consolidated income statement
* Consolidated balance sheet
* Consolidated statement of changes in equity
* Consolidated cash flow statement
CHAIRMAN'S STATEMENT
It is my great pleasure to present to you the 2007 Annual report for Zambezi
Nickel.
This year I believe we made great strides in understanding the geology of the
Mitaba and Paulwi projects in Zambia, as well as embarking on the exploration of
the promising Mavita project in Mozambique in joint venture with BHP Billiton.
In what was our first full year of exploration activities, our field staff have
worked tirelessly, efficiently and in a diligent manner to unravel the
complexities of the Mitaba project and I thank everyone involved in the process
to date. Although the efforts of their work did not reveal the presence of
massive sulphide nickel mineralisation at Mitaba, we believe that sufficient
encouragement remains to warrant the investigation of heap leaching nickel
mineralisation within the laterite profile.
I would also like to express how pleased and grateful we are to have received
such excellent assistance and cooperation from the government of Zambia, and in
particular the Minister of Mines and his department.
Your board successfully negotiated a Joint Venture with BHP Billiton over the
Mavita nickel project in Mozambique this year. Field work completed by our
staff has revealed the presence of very favourable geology and the presence of
nickeliferous sulphides in outcrop. The signs look promising and I look forward
to future exploration success at Mavita.
On the corporate front, I would like to thank Paul Rankine for his services as
our inaugural Chief Executive Officer and welcome Jim Kerr as his replacement.
I would also like to thank Hakainde Sammy Hichilema, who resigned from his
position as Non -Executive Director to pursue a career in Zambian politics, in
which I feel sure he will excel.
Your board remains firmly committed to the highest of standards at Zambezi
Nickel and continually strives to ensure that its operations meet and exceed
stringent standards of corporate governance and Health and Safety.
I look forward to another progressive year for Zambezi Nickel and feel confident
that the Company is well placed to build on its initial exploration efforts.
Jeremy Wrathall
Chairman
CONSOLIDATED INCOME STATEMENT
GROUP GROUP
YEAR ENDED YEAR ENDED
31 MARCH 31 MARCH
2007 2006
Notes
# #
Operating income 16,365 13,981
Expenses (411,009) (148,585)
Operating loss (394,734) (134,604)
Income tax expense - -
Loss after taxation for the financial period (394,734) (134,604)
Basic and diluted loss per share - # 2 (0.01) (0.01)
CONSOLIDATED BALANCE SHEET
GROUP GROUP
YEAR ENDED YEAR ENDED
31 MARCH 31 MARCH
2007 2006
Notes
# #
ASSETS
Non-current assets
Property, plant and equipment 17,510 3,579
Mineral Interests 3 1,856,849 1,161,754
Investment in subsidiaries - -
Total non-current assets 1,874,359 1,165,333
Current assets
Trade and other receivables 3,588 3,000
Prepayments 8,779 9,253
Cash and cash equivalents 260,906 1,156,873
Total current assets 273,273 1,169,126
Total assets 2,147,632 2,334,459
EQUITY AND LIABILITIES
Current liabilities
Trade and other payables 49,468 17,200
Provisions 1,188 6,486
Total current liabilities 50,656 23,686
Total liabilities 50,656 23,686
Equity
Issued capital 4 353,741 335,347
Share premium reserve 4 2,234,033 2,068,485
Options & Warrants reserve 72,003 50,353
Translation reserve (33,463)
(8,808)
Accumulated loss (529,338) (134,604)
Total equity 2,096,976 2,310,773
Total equity and liabilities 2,147,632 2,334,459
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
GROUP GROUP
YEAR ENDED YEAR ENDED
31 MARCH 31 MARCH
2007 2006
Notes
# #
Issued Capital
Opening balance 335,347 -
Issued during the year 18,394 335,347
Closing balance 4 353,741 335,347
Share Premium Reserve
Opening balance 2,068,485 -
Premium on shares 165,547 2,443,915
Less flotation costs - (375,430)
Closing balance 4 2,234,033 2,068,485
Options & Warrants Reserve
Opening balance 50,353 -
Charged during the year 21,650 50,353
Closing balance 72,003 50,353
Accumulated Losses
Opening balance (134,604) -
Loss for the year (394,734) (134,604)
Closing balance (529,338) (134,604)
Translation Reserve
Opening balance (8,808) -
Profit/(loss) for the year (24,655) (8,808)
Closing balance (33,463) (8,808)
Total 2,096,976 2,310,768
CONSOLIDATED CASH FLOW STATEMENT
GROUP GROUP
YEAR ENDED YEAR ENDED
31 MARCH 31 MARCH
2007 2006
# #
Cash flows from operating activities
Payments to suppliers and employees (365,685) (113,065)
Interest received 16,365 13,981
Net cash used in operating activities (349,320) (99,084)
Cash flows from investing activities
Payments for mineral interests (27,641) (183,124)
Purchase of property, plant and equipment (702,953) (3,671)
Net cash used in investing activities (730,594) (186,795)
Cash flows from financing activities
Advances to subsidiaries - -
Net proceeds from issue of share capital 183,947 1,461,004
Loan repayment - (18,252)
Net cash provided by financing activities 183,947 1,442,752
Net increase/(decrease) in cash and cash equivalents for (895,967) 1,156,873
the year
Cash and cash equivalents at beginning of year 1,156,873 -
Cash and cash equivalents at the end of year 260,906 1,156,873
1. Statement of Significant Accounting Policies
The financial report is a general purpose financial report that has been
prepared in accordance with International Financial Reporting Standards (IFRS),
adopted by the International Accounting Standards Board (IASB) that are
mandatory for accounting periods ended 31 March 2007, and interpretations issued
by the Standing Interpretations Committee of the IASB.
The financial report covers the economic entity of Zambezi Nickel Limited and
controlled entities, and Zambezi Nickel Limited as an individual parent entity.
Zambezi Nickel Limited is a listed public company, incorporated and domiciled in
Bermuda.
The financial report of Zambezi Nickel Limited complies with International
Financial Reporting Standards (IFRS) in their entirety.
The accounting policies have been consistently applied, unless otherwise stated.
Basis of Preparation
The Group financial statements are prepared on the historical cost and going
concern basis. The principal accounting policies are set out below.
Significant Accounting Policies
a. Principles of Consolidation
A controlled entity is any entity Zambezi Nickel Limited has the power to
control the financial and operating policies of so as to obtain benefits from
its activities. A list of controlled entities is contained in Note 8(b) to the
financial statements.
All inter-company balances and transactions between entities in the economic
entity, including any unrealised profits or losses, have been eliminated on
consolidation. Accounting policies of subsidiaries have been changed where
necessary to ensure consistencies with those policies applied by the parent
entity.
Where controlled entities have entered or left the economic entity during the
year, their operating results have been included/excluded from the date control
was obtained or until the date of control ceased.
Minority equity interests in the equity and results of the entities that are
controlled are shown as a separate item in the consolidated financial report.
Minority interests consist of the amount of those interests at the date of the
original business combination and the minority's share of changes in equity
since the date of the combination. Losses applicable to the minority in excess
of the minority's interest in the subsidiary's equity are allocated against the
interests of the Group except to the extent that the minority has a binding
obligation and is able to make an additional investment to cover the losses.
b. Exploration and Evaluation Expenditure
Exploration and evaluation expenditure incurred is accumulated in respect of
each identifiable area of interest. These costs are only carried forward to the
extent that they are expected to be recouped through the successful development
of the area or where activities in the area have not yet reached a stage that
permits reasonable assessment of the existence of economically recoverable
reserves.
Accumulated costs in relation to an abandoned area are written off in full
against profit in the year in which the decision to abandon the area is made.
When production commences, the accumulated costs for the relevant area of
interest are amortised over the life of the area according to the rate of
depletion of the economically recoverable reserves.
A regular review is undertaken of each area of interest to determine the
appropriateness of continuing to carry forward costs in relation to that area of
interest.
c. Foreign Currency Transactions and Balances
Functional and presentation currency
The functional currency of each of the Group's entities is measured using the
currency of the primary economic environment in which that entity operates. The
consolidated financial statements are presented in Pounds Sterling which is the
parent entity's functional and presentation currency.
Transaction and balances
Foreign currency transactions are translated into functional currency using the
exchange rates prevailing at the date of the transaction. Foreign currency
monetary items are translated at the year-end exchange rate. Non-monetary items
measured at historical cost continue to be carried at the exchange rate at the
date of transaction. Non-monetary items measured at fair value are reported at
the exchange rate at the date when fair values were determined.
Exchange differences arising on the transition of monetary items are recognised
in the income statement, expect where deferred in equity as a qualifying cash
flow or net investment hedge. Exchange differences arising on the translation of
non-monetary items are recognised directly in equity to the extent that the gain
or loss is directly recognised in equity, otherwise the exchange difference is
recognised in the income statement.
Group companies
The financial results and position of foreign operations whose functional
currency is different from the Group's presentation currency are translated as
follows:
* Assets and liabilities are translated at period-end exchange rates prevailing
at that reporting date;
* Income and expenses are translated at average exchange rates for the period;
and
* Retained earnings are translated at the exchange rates prevailing at the date
of the transaction.
Exchange differences on translation of foreign operations are transferred
directly to the Group's foreign currency translation reserve in the balance
sheet. These differences are recognised in the income statement in the period in
which the operation is disposed.
2. Loss Per Share
The calculation of loss per share is based on the loss for the financial year of
#394,734 and on a weighted average of ordinary shares 34,459,081 plus 3,500,000
options and 1,005,448 warrants on issue.
Shares GROUP GROUP COMPANY 2007 COMPANY 2006
2007 2006
Basic weighted average number 34,459,081 33,534,697 34,459,081 33,534,697
of ordinary shares in issue
# # # #
Basic loss per share (0.01) (0.01) (0.01) (0.01)
The following potential ordinary shares are not dilutive and are therefore
excluded from the weighted average number of ordinary shares:
Warrants 1,005,448 1,005,448 1,005,448 1,005,448
Staff & director options 3,500,000 4,729,167 3,500,000 4,729,167
4,505,448 5,734,615 4,505,448 5,734,615
3. Mineral Interests
Shares GROUP GROUP COMPANY 2007 COMPANY 2006
2007 2006
# # # #
Costs
As at 1 April 2006 1,161,754 - 1,118,575 -
Additions 716,318 1,161,754 223,227 1,118,575
Written off (21,223) - (21,223) -
As at 31 March 2007 1,856,849 1,161,754 1,320,579 1,118,575
The Company policy is to charge exploration expenditure to specific areas of
interest. Exploration expenditure that cannot be attributed to specific areas of
interest is written off.
Recoverability of the Group's carrying value of interests in mineral projects is
subject to the successful development and exploitation of the exploration
properties or alternatively, the sale of these tenements at amounts at least
equal to the book values.
4. Issued Capital
Authorised 302 million ordinary shares of par #0.01 each.
NUMBER OF SHARES ISSUED CAPITAL SHARE PREMIUM
Issued and fully paid
As at 1 April 2006 33,534,697 335,347 2,068,485
April 2006 Exercise of Options 3,815 38 343
June 2006 Exercise of Options 16,000 160 1,440
Aug 2006 Exercise of Options 1,000 10 90
Sept 2006 Exercise of Options 13,749 137 1,238
Oct 2006 Exercise of Options 1,804,859 18,049 162,437
Allotments during the year 1,839,423 18,394 165,548
Balance as at 31 Mar 2007 35,374,120 353,741 2,234,033
The following changes to the issued share capital of the Company have occurred
during the period:
i) Between April and October 2006, a total of 1,839,423 shareholder options
were exercised and the same number of ordinary fully paid shares of per
value #0.01 were issued. The exercise price of the options was #0.10.
Options
Shareholder options
i) During the prior period, a total of 4,729,167 options over ordinary fully
paid shares of par value #0.01 were issued to shareholders as part of the
allotment on its admission to the London Stock Exchange Alternative
Investment Market (AIM).
ii) Between April and October 2006 1,839,423 of these options were exercised,
in addition to 19,754 issued in the prior period.
iii) On 31 October 2006, the remaining 2,869,990 options expired.
Director options
i) Upon his resignation on 6 November 2006, the 800,000 options held by Paul
Rankine lapsed.
ii) Upon his appointment on 18 December 2006, Jim Kerr was granted the
following options:
NUMBER EXERCISE PRICE EXPIRY
Exercisable after 1st year
anniversary 2,000,000 0.05 14/01/2009
Exercisable after 3rd anniversary
750,000 0.10 14/10/2010
Exercisable after 5th anniversary
750,000 0.15 14/01/2012
5. Annual Report
The Annual Report will be sent to shareholders on or around 20 August 2007.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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