Investors & Media
Company releases
Preliminary results for the year to 31 December 2006
27 March 2007
The Board of Shanta Gold Limited is pleased to announce its preliminary audited results for the year ended 31 December 2006.
Highlights of the year
- The discovery of a new greenstone belt at Singida hosting some exciting grades
- Discovery of strong geochemical anomalies at the Chunya Project
- Funding of the company (through the exercise of warrants) provided for planned exploration programmes
The discovery of a new greenstone belt at Singida is undoubtedly the highlight of the year. We have made excellent progress at Singida, now our most advanced project in Tanzania, which, only 18 months ago, was just a grassroots exploration prospect. Our exploration teams have completed 34,000 metres of drilling at five identified targets within the Londoni 1 region, all of which lie within a 5.75 kilometre strike length. Some of the highlights of the drilling programme completed to date are the intersections of some very high gold grades, particularly at the targets known as the Gold Tree, the Jem and the Corn Patch, where gold grades of up to 45 grammes per tonne have been recorded. What has been particularly encouraging at Singida is that virtually all the intersections encountered are within the parameters of open pit mining, at an average depth of 150 metres.
Further south in Tanzania, at our Chunya project, some 400 kilometres from Singida, our exploration teams have made solid strides in a geochemical sampling programme which has yielded a strong gold geochemical anomaly in excess of 50 parts per billion gold (ppb Au), along a 6,500 metre strike. With no evidence of previous drilling at this target we have now mobilized a team to start a second phase exploration programme in preparation for initial reverse circulation drilling.
Since the admission of the Company to AIM (a market of the London Stock Exchange) in July 2005, we have seen other flotations of junior exploration and mining companies active in Africa – still a highly prospective continent. We have been fortunate that, with our presence in Tanzania over a two-year period, we believe we can now boast firm and established relationships in that country, and with the excellent cooperation we have received from the authorities, we have been able to make solid, indeed rapid progress.
During the year we were fortunate to welcome Richard Jonah to the Shanta board. The Jonah family’s close association with mining ventures in this region further strengthens our position in this exciting sector in Tanzania. Richard brings a happy combination of local knowledge and access to global experience to the Shanta board.
We believe that our presence on AIM continues to attract investors. In addition, with a number of warrants being exercised over the period, from a funding point of view we believe we are adequately resourced to continue to advance our exploration programme at Singida in order to prove up a resource, whilst we will also be in a comfortable position to progress beyond the initial phase at Songea and Chunya, the two greenfield projects in our portfolio. We also plan to complete our drilling programme at the Mgusu project during the year – Mgusu being situated in the well-known Lake Victoria district greenstone belt. Holders of warrants, issued at the time of admission, are reminded that these will expire in June this year. Conversion of these warrants will further enhance our ability to fund our exploration programme, without having to raise capital in the market for some time to come.
As an exploration company we constantly need to re-evaluate our portfolio of prospects and their accompanying licences in an effort to ensure that shareholders get maximum value for their exploration dollars. During the year we added strategic rights to our land position in Tanzania, concluding joint venture agreements on 28 primary mining licences.
Looking to the future we will continue to work towards proving up a resource at Singida. With drilling starting at Chunya and Songea, we hope we will soon be in a position to report drilling results to shareholders from these prospects also.
It would be remiss of me not to also thank the local communities and authorities who have been so supportive of our activities. We adopt a sense of responsible interface with local communities, as we strive to foster mutually beneficial relationships in the areas we target for further prospecting. In conclusion I wish to express my thanks to my fellow directors for their hands-on and energetic support, and to our shareholders, for their continued loyalty. To our staff on the ground I must convey enormous gratitude for their relentless efforts in what has turned out to be a key gold discovery.
Financial Results
Consolidated results for the Company have been prepared based on international financial reporting standards.
| Period to 31 December 2005 US$000 |
Year ended 31 December 2006 US$000 |
|
|---|---|---|
| 46 | Operating income | 2 |
| (1533) | Exploration costs | (7395) |
| (710) | Administration expenses | (1606) |
| (422) | Share option costs | (726) |
| (2619) | Operating loss | (9725) |
| 91 | Investment revenue | 455 |
| (2528) | Net loss for the year/period | (9270) |
| 5.18 | Loss per share basic and headline (US cents) 1 | 12.27 |
| 5.17 | Loss per share diluted (US cents) 2 | 9.54 |
1. Based on 75531028 weighted average shares in issue (2005-48791164)
2. Based on 97168407 weighted average fully diluted shares (2005-48939313)
| Period to 31 December 2005 US$000 |
Year ended 31 December 2006 US$000 |
|
|---|---|---|
| Assets | ||
| Non current assets | ||
| 671 | Intangible assets | 1431 |
| 152 | Property, plant and equipment | 359 |
| 3318 | Goodwill | 3318 |
| 4141 | 5108 | |
| Current assets | ||
| 121 | Other debtors and prepayments | 289 |
| 5301 | Cash and cash equivalent | 15546 |
| 5422 | 15835 | |
| 9563 | Total assets | 20943 |
| Equity and liabilities | ||
| Equity | ||
| 10020 | Share capital and premium | 29574 |
| 422 | Share option reserve | 1148 |
| 672 | Warrant Reserve | 306 |
| 119 | Translation Reserve | 400 |
| (2528) | Accumulated loss | (11798) |
| 8705 | 19630 | |
| Non current liabilities | ||
| 508 | Loans from related parties | 340 |
| Net current liabilities | ||
| 350 | Other creditors and accruals | 973 |
| 9563 | Total equity and liabilities | 20943 |
| Period to 31 December 2005 US$000 |
Year ended 31 December 2006 US$000 |
|
|---|---|---|
| (745) | Cash flows from operating activities | (7680) |
| (112) | Cash flows from investing activities (net) | (1205) |
| 5774 | Share issue proceeds (net) | 19191 |
| 384 | Loans received and repaid | (168) |
| 6158 | Cash flows from financing activities | 19023 |
| 5301 | Increase in cash and cash equivalent | 10138 |
| - | Cash and equivalents at the beginning of year/period | 5301 |
| - | Foreign exchange adjustment | 107 |
| 5301 | Cash and equivalents at the end of year/period | 15546 |
| Share Capital | Share Premium | Share Options | Warrant Reserve | Translation Reserve | Accumulated Loss | TOTAL | |
|---|---|---|---|---|---|---|---|
| Balance on incorporation | - | - | - | - | - | - | |
| Shares issued | 11 | 12499 | 12510 | ||||
| Shares issue expenses | (2490) | (2490) | |||||
| Share option costs | 422 | 422 | |||||
| Warrant reserve | 672 | 672 | |||||
| Translation reserve | 119 | 119 | |||||
| Loss for the period | (2528) | (2528) | |||||
| Total equity as at 31 December 2005 | 11 | 10 009 | 422 | 672 | 119 | (2528) | 8705 |
| Shares issued | 6 | 19230 | 19236 | ||||
| Shares costs | (48) | (48) | |||||
| Share Option costs | 726 | 726 | |||||
| Transfer on exercise of warrants | 366 | (366) | - | ||||
| Translation on consolidation | 281 | 281 | |||||
| Loss for the year | (9270) | (9270) | |||||
| Total equity as at 31 December 2006 | 17 | 29557 | 1148 | 306 | 400 | (11798) | 19630 |
Annual Report
The Annual Report will be sent to shareholders on or about 2 April 2007. Additional copies will be available to the public, free of charge, from the Company's registered office at Suite A, St Peter Port House, Sausmarez St, St Peter Port, Guernsey, GY1 2PU.
Annual General Meeting
The Company's Annual General Meeting will be held on 27 April 2007 at 11 am at the offices of NMT Trustees at Suite A, St Peter Port House, Sausmarez St, St Peter Port, Guernsey.
For further information:
Shanta Gold
Walter Vorwerk:
Tel: +27 (0)83 308 0080
WH Ireland
David Youngman:
+44 161 832 2174