Annual Report 2013

Notes to the Financial Statements

for the year ended 31 December 2013

16. CASH AND CASH EQUIVALENTS

 

GROUP

COMPANY

 

2013

2012

2013

2012

 

US$’000

US$’000

US’000

US$’000

Immediately available without restriction

64,479

7,773

214

291

Contingency Reserve Account

53

21,408

-

-

Project Companies’ Accounts

3,014

16,886

-

-

 

67,546

46,067

214

291

 

 

 

 

 

The Contingency Reserve Account (the “CRA”) is an account established under a cash collateral and shareholder funding deed to provide for shareholder funding to the Project Companies and to secure the obligations of the Company and Congolone Heavy Minerals Limited (a wholly-owned subsidiary undertaking) under the Completion Agreement as detailed in Note 21.

Cash and cash equivalents comprise cash balances held for the purposes of meeting short-term cash commitments and investments which are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value. Where investments are categorised as cash equivalents, the related balances have a maturity of three months or less from the date of investment.

Interest rate risk

Cash at bank earns interest at variable rates based on daily bank deposit rates, which may be zero. Short-term deposits are made for varying periods of between one day and three months, depending on the cash requirements of the Group, and earn interest at the respective short-term deposit rates. The interest rate profile of the Group’s cash balances at the year-end was as follows:

 

2013

2012

 

US$’000

US$’000

Cash and cash equivalents at variable interest rate

66,988

44,473

Cash at bank on which no interest is received

558

1,594

 

67,546

46,067

 

 

 

Currency risk

The currency profile of cash and cash equivalents at the year-end is as follows:

GROUP

2013

2012

 

US$’000

US$’000

US Dollars

60,814

16,061

Sterling

5,126

3,808

South African Rand

880

25,155

Mozambican Metical

320

652

Euro

313

327

Singapore Dollars

88

14

Australian Dollars

5

50

 

67,546

46,067

 

 

 

COMPANY

2013

2012

 

US$’000

US$’000

Euro

233

166

Sterling

(22)

125

US Dollars

3

-

 

214

291

 

 

 

Credit risk

The credit risk on cash and cash equivalents is limited because funds available to the Group are deposited with banks with high credit ratings assigned by international credit rating agencies. For deposits of US$50 million plus the Group requires that the institution have an A (S&P)/ A2 (Moody’s) long term rating. For deposits of US$20 million or South African Rand denominated deposits the Group requires that the institution have a BBB+ (S&P)/Baa1 (Moody’s) long term rating.

17. CALLED-UP SHARE CAPITAL

GROUP & COMPANY

 

2013

2012

 

€’000

€’000

Authorised Share Capital

 

 

3,000,000,000 Ordinary Shares of €0.06 each

180,000

180,000

100,000,000 Deferred Shares of €0.25 each

25,000

25,000

 

205,000

205,000

 

 

 

 

2013

2012

 

US$’000

US$’000

Allotted, Called-Up and Fully Paid

 

 

Ordinary Shares

 

 

Opening Balance

 

 

2,531,138,837 Ordinary Shares of €0.06 each

194,586

-

2,409,730,507 Ordinary Shares of €0.06 each

-

185,765

 

194,586

185,765

 

 

 

Shares issued during the year

 

 

250,766,666 Ordinary Shares of €0.06 each

20,355

-

121,408,330 Ordinary Shares of €0.06 each

-

8,821

 

20,355

8,821

 

 

 

Closing Balance

 

 

2,781,905,503 Ordinary Shares of €0.06 each

214,941

-

2,531,138,837 Ordinary Shares of €0.06 each

-

194,586

 

214,941

194,586

 

 

 

Deferred Shares

 

 

Opening & Closing Balance

 

 

48,031,467 Deferred Shares of €0.06 each

10,582

10,582

Total Called-Up Share Capital

225,523

205,168

 

 

 

On 16 October 2013, 250,300,000 new ordinary shares were issued by way of a placing which raised US$101.9 million net of expenses. The proceeds of the equity raising was used in part to discharge near term payment obligations in respect of the expansion of the Mine and to repay US$20 million of the Company’s Absa corporate facility. The remainder of the proceeds is being used for working capital. US$20.4 million of this issue has been credited to share capital. US$81.5 million of this issue has been credited to share premium.

In addition to ordinary shares, participants in the placing were issued warrants on the basis of one warrant to subscribe for one ordinary share in the Company for every five placing shares. In total 50,060,000 warrants were issued. The warrants, which are not listed or admitted to trading and which have limited transferability rights, have an exercise price of Stg£29.09p and an exercise period of five years, commencing thirteen months after the date of issue.

466,666 new ordinary shares were issued during 2013 as a result of share options exercised and resulted in US$0.04 million being credited to share capital and US$0.08 million credited to share premium.

On 25 July 2012, 120,000,000 new ordinary shares were issued by way of a placing which raised US$56.7 million net of expenses. The primary purpose of this equity raising was to provide part of the funding for the expansion of the Mine. US$8.7 million of this issue has been credited to share capital. US$48.0 million of this issue has been credited to share premium. 1,408,330 new ordinary shares were issued during 2012 as a result of share options exercised and resulted in US$0.1 million being credited to share capital and US$0.4 million credited to share premium.

The Deferred Shares of €0.25 per share were created in 1991 by subdividing each existing Ordinary Share of IR25p into one Deferred Share of IR20p and one new Ordinary Share of IR5p. The Deferred Shares are non-voting, carry no dividend rights and the Company may purchase any or all of these shares at a price not exceeding €0.013 per share for all the deferred shares so purchased.

18. SHARE PREMIUM

GROUP & COMPANY

 

2013

2012

 

US$’000

US$’000

Opening Balance

349,780

301,391

Premium on shares issued during year

85,703

51,225

Costs associated with shares issued during the year

(4,103)

(2,836)

Closing Balance

431,380

349,780

 

 

 

19. RETAINED (LOSSES)/EARNINGS

GROUP

 

US$’000

Balance at 1 January 2012

(19,994)

Profit for the year attributable to equity holders of the parent

49,486

Share options exercised

309

Balance at 1 January 2013

29,801

Loss for the year attributable to equity holders of the parent

(44,120)

Share options exercised

81

Balance at 31 December 2013

(14,238)

 

 

COMPANY

 

US$’000

Balance at 1 January 2012

(38,534)

Loss for the year attributable to equity holders of the parent

(5,165)

Share options exercised

309

Balance at 1 January 2013

(43,390)

Loss for the year attributable to equity holders of the parent

(13,638)

Share options exercised

81

Balance at 31 December 2013

(56,947)

 

 

During the year US$0.08 million (2012: US$0.3 million) share options were exercised.

20. OTHER RESERVES

GROUP & COMPANY

 

Share

Capital

Total

 

Option

Conversion

 

Reserve

Reserve

 

Fund

 

US$’000

US$’000

US$’000

Balance at 1 January 2012

16,856

754

17,610

Recognition of share-based payments

3,547

-

3,547

Share options exercised

(309)

-

(309)

Balance at 1 January 2013

20,094

754

20,848

Recognition of share-based payments

780

-

780

Share options exercised

(81)

-

(81)

Balance at 31 December 2013

20,793

754

21,547

 

 

 

 

The share option reserve arises on the grant of share options to certain Directors, employees and consultants under the share option scheme. Details of share-based payments are given in Note 32.

The capital conversion reserve fund arises from the re-nominalisation of the Company’s share capital from Irish Punts to Euro.