LONDON, ENGLAND and BAIE VERTE, NEWFOUNDLAND AND LABRADOR
-- (MARKET WIRE)
-- 03/22/12
Rambler Metals and Mining PLC (TSX VENTURE:RAB)(AIM:RMM) ("Rambler" or the "Company") today is pleased to report its financial results and operational highlights for the three months ended 31 January 2012. Over the quarter, the Company successfully moved into production, producing gold during the commissioning and testing of 1806 zone ores, at its 100% owned Ming Copper-Gold Mine in Newfoundland's Baie Verte Peninsula, Canada.
Operational Achievements
-- A total of 4,022 ounces of gold were processed from the Ming Mine of
which 3,563 ounces were poured and shipped for further refining at an
average price of CAD$1,662/oz
-- Gold recoveries of nearly 91% in the first quarter of gold production
-- Total of 38,922 tonnes of the gold rich ore were mined with an
additional 39,677 tonnes either developed, drilled or blasted
-- Finalized an off-take agreement for the copper concentrates production
from the Ming Mine with Transamine Trading for the sale of 85,000 tonnes
of concentrates over the initial 6 year mine life, at international
market rates
-- Draw down of the second installment of CAD$2.5 million from the $10.0
million credit facility issued by Sprott Resource Lending Partnership.
The remaining CAD$2.5 million is available until August 2012
Financial Highlights (All expressed in CAD$)
-- Revenue: $2.5 million in Q2 realized on the physical sale of 1,459
ounces of gold produced during the commissioning and testing of 1806
zone ores with an additional $3.6 million realized subsequent to the
quarter end on the sale of remaining 2,104 ounces poured and shipped
during Q2; all revenues offset against mineral property expenditures;
(Q2 2011: $1.2 million realized on the Group's Tilt Cove satellite
deposit)
-- Net loss: $1,039,000 in Q2 (Q1 2012: $845,000 / Q2 2011: $555,000)
including a Foreign Exchange loss of $267,000 resulting from the
strengthening of the USD relative to CAD on the translation of the USD
gold loan
-- Cash flows utilized in operating activities: $530,000 in Q2/12 compared
to $1,284,000 generated from operating activities in Q1/12 (Q2 2011:cash
flows utilized of $979,000)
-- Cash resources as at January 31, 2012 were $4.0 million (as of March 22,
2012: $7.1 million). A further $2.5 million is available under the
Group's Credit Facility Agreement
Post-period highlights
-- On February 8, 2012 the Group announced the purchase of Ming Mine's 2%
net smelter royalty held by Philippine Metals Inc., formerly Meridian
Mining Corporation, for CAD$600,000 to bring the net smelter royalty
down to 2.5% from 4.5%
-- On February 15, 2012 the Group acquired a 17% stake and a board position
in Maritime Resources Corp for a total consideration of $1,035,000
-- On March 6, 2012 the Group accepted an offer from Tinma International
Ltd ('Tinma') to become a strategic shareholder for a total cash
consideration of $4.58 million, issuing new shares to bring Tinma's
total shareholding to approximately 9.9% of the issued share capital
-- On March 15, 2012 the Group announced a favorable Preliminary Economic
Assessment that sees the potential for an expansion of the Ming Mine
into the Lower Footwall Zone ('LFZ') following additional value
optimization studies and later a bankable feasibility study
George Ogilvie, President and CEO, Rambler Metals & Mining commented:
"I am pleased to report a successful first quarter of production, producing gold during the commissioning and testing of 1806 zone ores, from our 100% owned Ming Mine. Bringing this mine into production is a testament to the hard work of all Rambler employees and speaks to the broad success of this team. While the company enjoys first gold pours and ramping up of production we look forward to the mining of higher grade ore from the 1807 zone while firing up our copper production capacities.
"The next few quarters will be very significant for Rambler, particularly as we move the Ming Mine into commercial production. We will seek to continue optimizing the mining and processing of ores while taking a closer look at the LFZ. Furthermore, we will continue to develop and explore the various zones for additional opportunities.
"I continue to be optimistic about Rambler's long term strategy to become the region's low-cost producer by continuing to assess opportunities for joint ventures or acquisitions."
ABOUT RAMBLER METALS AND MINING
Rambler Metals and Mining plc is a Junior Mining Company that has 100% ownership of the Ming Copper-Gold Mine in Baie Verte, Newfoundland and Labrador, Canada. As a producing gold and copper miner, our objective is to become a mid-tier mining company by continuing the development of the Ming Mine, discovering new deposits and through mergers and acquisitions.
The initial six years of the Ming Mine project is based on the underground mining of massive sulphides with a mineable reserve estimate of 1.498 million ore tonnes grading 1.62% copper, 2.40 g/t gold and 10.90 g/t silver (24,252 tonnes of copper, 115,549 ounces of gold and 525,139 ounces of silver of contained metal). All massive sulphide zones remain open both up and down plunge with the current exploration program focused on extending the known mineralization for inclusion in the resource/reserve estimate.
In addition to the outlined reserve estimate there is a sizeable footwall deposit, beneath the massive sulphide horizon, that has been outlined with an indicated resource grade of 18,306k tonnes grading 1.43% copper (261,258 tonnes of contained copper at a 1.00% copper cut-off grade). This zone forms the basis of the preliminary economic assessment, recently completed by the Company, which envisions the Ming Mine transitioning itself into a bulk tonnage mining operation. For further information on the Ming Mine project, please refer to the Company's NI 43-101 compliant technical reports, available under the Company's profile on SEDAR (www.sedar.com).
Over the coming months and years, as the Company seeks to optimize the Ming Mine project into cash positive position, it is expected that future expansion into the footwall zone will be formalized with the goal of maximizing returns for shareholders and increasing the life of mine.
Caution Regarding Forward Looking Statements:
Certain information included in this press release, including information relating to future financial or operating performance and other statements that express the expectations of management or estimates of future performance constitute "forward-looking statements". Such forward-looking statements include, without limitation, statements regarding the financial strength of the Company, estimates regarding timing of future development and production and statements concerning possible expansion opportunities for the Company. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by such forward-looking statements. Such risks include, but are not limited to, interpretation and implications of drilling and geophysical results; estimates regarding timing of future capital expenditures and costs towards profitable commercial operations. Other factors that could cause actual results, developments or events to differ materially from those anticipated include, among others, increases/decreases in production; volatility in metals prices and demand; currency fluctuations; cash operating margins; cash operating cost per pound sold; costs per ton of ore; variances in ore grade or recovery rates from those assumed in mining plans; reserves and/or resources; the ability to successfully integrate acquired assets; operational risks inherent in mining or development activities and legislative factors relating to prices, taxes, royalties, land use, title and permits, importing and exporting of minerals and environmental protection. Accordingly, undue reliance should not be placed on forward-looking statements and the forward-looking statements contained in this press release are expressly qualified in their entirety by this cautionary statement. The forward-looking statements contained herein are made as at the date hereof and the Company does not undertake any obligation to update publicly or revise any such forward-looking statements or any forward-looking statements contained in any other documents whether as a result of new information, future events or otherwise, except as required under applicable securities law.
Management's Discussion & Analysis ('MD&A')
For the Quarter Ended January 31, 2012
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This MD&A, including appendices, is intended to help the reader understand
Rambler Metals and Mining plc ('the parent company') and its subsidiaries
(the 'Group' or 'Rambler'), our operations and our present business
environment. It has been prepared as of March 22, 2012 and covers the
results of operations for the quarter ended January 31, 2012. This
discussion should be read in conjunction with the audited Financial
Statements for the year ended July 31, 2011 and notes thereto. These
consolidated financial statements have been prepared in accordance with
International Financial Reporting Standards ("IFRS") and their
interpretations adopted by the International Accounting Standards Board
("IASB"), as adopted by the European Union and with IFRS and their
interpretations adopted by the IASB. The presentation currency is Canadian
dollars. These statements together with the following MD&A are intended to
provide investors with a reasonable basis for assessing the potential future
performance.
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Rambler Metals and Mining plc
Salatin House
19 Cedar Road
Sutton
Surrey
SM2 5DA
CONTENTS
GROUP OVERVIEW 2
HIGHLIGHTS OF THE SECOND QUARTER 3
FINANCIAL RESULTS 5
HEALTH AND SAFETY 6
OUTLOOK 6
CAPITAL PROJECTS UPDATE 7
FINANCIAL REVIEW 10
SUMMARY OF QUARTERLY RESULTS 11
LIQUIDITY, CAPITAL RESOURCES AND FINANCIAL POSITION 12
COMMITMENTS AND LOANS 14
SUBSEQUENT EVENTS 16
APPENDIX 1 - LOCATION MAP 17
APPENDIX 2 - SELECTED FINANCIAL INFORMATION & REVIEW OF OVERALL
PERFORMANCE 18
APPENDIX 3 - CRITICAL ACCOUNTING POLICIES AND ESTIMATES 19
CHANGES IN ACCOUNTING POLICIES 21
APPENDIX 4 - OTHER MATTERS 22
Outstanding Share & Option Data 22
Forward Looking Information 22
Forward Looking Information (continued) 23
Further information 23
GROUP OVERVIEW
The principal activity of the Group is the development, mining and exploration of the Ming Copper-Gold Mine ('Ming Mine') located on Newfoundland and Labrador's Baie Verte Peninsula. See Appendix 1. On November 28, 2011 the Group was successful in bringing the mine into production while testing and commissioning with 1806 ores and continues to pour gold dore on a bi-weekly basis.
The parent Company's Ordinary Shares trade on the London AIM market under the symbol "RMM" and the TSX Venture Exchange under the symbol "RAB".
The Group has established the following three strategic goals:
1. Become a profitable copper and gold producer by maximizing the use of
the Nugget Pond processing facility.
2. Increase existing Ming Mine resources and reserves through further
exploration.
3. Selectively pursue growth opportunities within Atlantic Canada including
joint ventures, acquisitions, strategic alliances and equity positions.
The Group's directors and management believe that focussing on these priorities will provide a solid foundation for the Company while providing the best opportunity to build a successful and long term mining company.
HIGHLIGHTS OF THE SECOND QUARTER
During the quarter Management successfully brought the Ming Mine into production, producing gold during the commissioning and testing of 1806 zone ores. Trucking of gold ore from the mine to the Group's processing facilities at Nugget Pond began on November 28, 2011 followed by the Company's first gold dore being poured on December 12, 2011. While milling to date has been through the gold hydrometallurgical facility, during the quarter final construction on the new copper concentrator was completed and is now ready for 'live' commissioning. This quarter marks a significant milestone for the business with first commissioning revenues being produced from its 100% owned Ming Copper-Gold Mine. Rambler Metals and Mining plc is now a step closer to commercial production.
Highlights of the second quarter of the 2012 fiscal year included:
Capital Development and Production
-- Since the start of testing and commissioning of 1806 ores in November
2011, a total of 4,022 ounces of gold was processed of which 3,563
ounces were poured and shipped for further refining. The higher than
projected refined ounces is a result of slightly higher head grade than
estimated in the 1806 reserve. Through continued testing throughputs
improved during the period, averaging 600 metric tonnes per day ('mtpd')
with the highest one day throughput being 695 mtpd. Recovery of gold
through the plant continued to improve and was nearing 91% by quarter
end while testing continues to address the lower silver recoveries being
experienced.
-- With all construction and dry commissioning of the copper concentrator
complete, the new facility is ready for 'live' ore commissioning once
the developed tonnes of the 1806 zone are finished being mined and
milled. At quarter end a total of 38,922 tonnes of the gold rich ore
were mined with an additional 39,677 tonnes either developed, drilled or
blasted. Development into the high grade copper 1807 zone is also
continuing with ore being stock piled when level access is available. Of
particular importance is the completed development into the Lower
Footwall Zone which will provide the initial 15,000 tonnes to the
concentrator once commissioning begins in calendar 2Q 2012.
Financing & Off-take Agreement
-- Finalized an off-take agreement for the copper concentrates production
from the Ming Mine with Transamine Trading for the sale of 85,000 tonnes
of concentrates over the initial 6 year mine life, at international spot
rates. The agreement includes a provisional payment for concentrates as
it arrives at the Goodyear's Cove port facility which is of particular
importance as it will ensure steady cash flow to the Group as soon as
concentrate production begins in calendar 2Q 2012.
-- Upon the completion of a second site visit from Sprott Resource Lending
Partnership and execution of the off-take agreement the final tranche of
CAD$5.0 million was made available on the previously announced Credit
Facility Agreement of September 29, 2011. On January 30 the Group drew
down its second installment of CAD$2.5 million from the $10.0 million
credit facility. The remaining CAD$2.5 million is available until August
2012. A portion of the funds were used subsequent to the quarter end to
buyout a 2% royalty encumbrance held on the Ming Mine property (see
Subsequent Events, page 16).
-- Subsequent to the quarter ended January 31, 2012, completed a non-
brokered private placing with a strategic partner, Tinma International
Ltd. ('Tinma'), a wholly-owned subsidiary of a China-based investor, by
issuing 10,403,980 ordinary shares at a placing price of CAD $0.44 per
ordinary share for total proceeds of $4.58 million (see Subsequent
Events, page 16).
Exploration and evaluation
-- Subsequent to the quarter ended January 31, 2012 completed a NI43-101
preliminary economic assessment to evaluate the profitability of mining
the Group's Lower Footwall Zone. This assessment evaluated the potential
for an expansion program to first optimize then transition the Ming Mine
into a bulk tonnage operation. The results showed positive economics,
good internal rate of return and significant cash flow in addition to
numerous areas of opportunities which can only further improve the
findings in future studies (see Subsequent Events, page 16).
Staffing
-- Coinciding with the start of production, the Nugget Pond facility was
staffed through the addition of 14 employees to the operating,
electrical and maintenance fields. Throughout the quarter the mine
operation continued to fill underground staffing positions as dictated
by production and development requirements.
-- At quarter end a total of 117 full time employees were employed at the
Ming Mine.
FINANCIAL RESULTS
-- Revenue
-- A total of 4,022 ounces of gold were processed from the Ming Mine of
which 3,563 ounces were poured and shipped for further refining. Of
the 3,563 ounces shipped, 1,459 ounces were physically sold
(settled) under the Group's refining agreement at an average price
of CAD$1,662 resulting in $2.5 million in revenue during the
quarter. The remaining 2,104 ounces were settled subsequent to the
quarter end at an average price of CAD$1,710 yielding gross revenue
of $3.6 million. Revenues realized during the testing and
commissioning of the Ming Mine are credited to Mineral Property
until commercial production is achieved.
-- Loss
-- The net loss for the quarter ended January 31, 2012 was $1,039,000
including an exchange loss of $267,000 or $0.008 per share compared
to a net loss of $845,000 for Q1/12 and a net loss of $555,000 for
Q2/11. The exchange differences arise on the period end translation
of the USD Gold Loan. Exchange losses experienced through the first
two quarters of fiscal 2012 were $988,000 and relate to the
weakening of the Canadian Dollar against the US dollar. Q2/12 net
loss increased as no profit was realized from the Group's Tilt Cove
satellite deposit during the quarter and the project is now
suspended pending further economic evaluation.
-- Cash flow and cash resources
-- Cash flows utilized in operating activities were $530,000 in Q2/12
compared to $1,284,000 generated from operating activities in Q1/12
and cash flows utilized of $979,000 in Q2/11. The increase in the
cash utilized is due to the cessation of ore processing from the
Group's Tilt Cove satellite deposit and changes in working capital.
-- Cash resources (including short-term investments) as at January 31,
2012 were $4.0 million and as of March 22, 2012 had increased to
$7.1 million. A further $2.5 million is available under the Group's
Credit Facility Agreement.
HEALTH AND SAFETY
-- The Group completed the quarter with no lost time accidents and 3
medical aid injuries. No time was lost as all injured employees were
handled through Rambler's Return to Work Program.
-- The Health and Safety of the Group's employees continues to be a high
priority with prevention and hazard recognition being key components of
the Group's strategy.
OUTLOOK
Management continue to pursue the following objectives:
-- Move the Ming Mine into commercial production before the end of fiscal
year 2012.
-- Continue mining and milling the exposed 1806 workplaces for the
continued generation of revenues from the Ming Mine. Additional
development focus has been put into preparing the high grade 1807 for
processing during calendar 2Q 2012. This new development has permitted
further exploration both up-dip and down-dip for inclusion in future
resource and reserve estimates.
-- Optimize the mining and processing of ores from the Ming Mine in
addition to continue to evaluate a possible future expansion into the
Lower Footwall Zone.
-- Become a strategic long term low-cost producer on the Baie Verte
Peninsula, and throughout Atlantic Canada, by selectively pursuing
growth opportunities including joint ventures and acquisitions,
including the Group's investment in Maritime Resources Corp subsequent
to quarter end (see Subsequent Events, page 16).
See 'Forward Looking Information' for a description of the factors that may cause actual results to differ from forecast.
CAPITAL PROJECTS UPDATE
During the quarter the Group incurred $7,059,000 on Mineral Property offset by revenue of $2,479,000 from gold production, $3,992,000 on property, plant and equipment and $38,000 on exploration and evaluation of the Ming Mine.
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Mineral Property (capital development) Q2/12 Q1/12 Q2/11
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$,000 $,000 $,000
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Labour costs 2,031 1,789 923
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Contractors' and consultancy expenses 88 143 1,085
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General materials and other costs 250 271 289
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Surface development 171 64 117
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Underground development 1,666 1,121 1,141
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Royalties 57 - -
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Processing and ore transportation 1,223 - -
--------------------------------------------================================
Sub-total 5,486 3,388 3,555
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Finance costs 1,408 630 220
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Depreciation 1,056 914 386
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Reclamation and closure provision 23 (98) 51
--------------------------------------------================================
Total 7,059 4,834 4,212
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Revenue recognized from gold production (2,479) - -
--------------------------------------------================================
Net 5,494 4,834 4,212
--------------------------------------------================================
Mineral property costs increased in Q2/12 compared to Q1/12 in line with an increase in underground capital development and the start of production. Labour and underground development costs increased over the comparable quarters in line with the hiring of an additional 19 full time employees and the commencement of production which also resulted in the Group's first processing and ore handling and royalty expenditures. Finance costs increased in Q2/12 when compared to Q1/12 due to the timing of planned production and the market price of gold increasing the interest charges on the Gold Loan liability. Increased costs in Q2/12 compared to Q2/11 relate to the ramp up in development following the decision to bring the Ming Mine back into production in Q1/11. Prior to the mine being considered substantially complete and ready for its intended use, all direct operating costs, including costs associated with stockpile ores, are capitalized within mineral property and offset by revenues generated from ongoing production.
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Mineral Property (capital development of by Q2/12 Q1/12 Q2/11
area, before finance cost, depreciation and
reclamation)
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$,000 $,000 $,000
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Surface 997 623 265
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1806 ore zone 1,440 695 8
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1807 ore zone 212 15 827
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Lower Footwall ore zone 103 168 -
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Ramp improvements & ongoing maintenance 1,288 1,403 667
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Shaft manway rehab 8 20 1,400
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Administrative 427 452 388
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Port site 96 12 -
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Nugget Pond Mill 914 - -
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Total 5,486 3,388 3,555
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Surface related costs increased in Q2/12 compared to Q2/11 mainly due to the ore transportation of 1806 ores to the Nugget Pond Mill. Increased costs experienced on the 1806 ore zone in line with continue development and the Group's first production mining. 1807 ore zone expenditures increased in Q2/12 compared to Q1/12 in preparation of developing the next stopes for production upon the completion of 1806 ores. Lower Footwall ore zone expenditures in Q2/12 relate to ongoing development aimed at accessing ores for the commissioning of the Group's copper concentrator.
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Property, plant and equipment Q2/12 Q1/12 Q2/11
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$,000 $,000 $,000
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Mill purchase and construction 1,671 4,160 4,536
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Plant and equipment 2,089 72 3,790
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Buildings 152 510 674
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Other assets 80 91 17
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Total 3,992 4,833 9,017
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Mill purchase and construction reduced during Q2/12 compared to Q1/12 reflecting the substantial completion of the copper concentrator. Plant and equipment increased Q2/12 compared to Q1/12 due to the capital lease acquisition of a further scoop tram and mine truck. Buildings reduced in Q2/12 compared to Q1/12 reflecting the addition of the Goodyear's Cove Storage facility during Q1/12.
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Exploration and evaluation costs (Ming Mine) Q2/12 Q1/12 Q2/11
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$,000 $,000 $,000
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Labour costs - - 1
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Consultancy expenses 248 38 14
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Operating costs - - 1
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Total 248 38 16
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Following the completion of the Ming Mine feasibility study, the Ming Mine project moved from pure Exploration & Evaluation into the Mine Development stage. Exploration expenditures incurred during Q2/12 related to the ongoing preliminary economic assessment of the Lower Footwall Zone of the Ming Mine.
FINANCIAL REVIEW
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Q2/12 Commentary Comparatives
Results
($000's)
Q1/12 B/(W)(i) Q2/11 B/(W)
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- Revenue in Q1/12 was 1,219 - 266 -
generated through gold
sales from the Group's Tilt
Cove East Mine and the
further refining of slag
materials from the Nugget
Pond Crown Pillar satellite
deposits. Revenue in Q2/11
was from toll processing
agreements. Revenues
realized in Q2/12 during
the testing and
commissioning of the Ming
Mine have been credited
against Mineral Property
and will continue until
commercial production is
achieved (see 'Ming Mine
Revenue' below).
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- Operating Costs in Q1/12 674 - 198 -
related to processing,
mining, royalty and general
and administrative costs
associated with the Group's
Tilt Cove East satellite
deposit completed in August
2011. Q2/11 costs were
incurred from a toll
processing agreement.
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783 General and administrative 694 (13)% 698 (12)%
expenses were higher than
the previous quarter by
$89,000. Legal and
professional charges
increased by $65,000
related to tax consultancy.
Investor relations, travel
and entertaining costs
increased by $35,000 as a
result of the focus on
bringing the Ming Mine into
production.
In comparison to Q2/11
administrative expenses
increased by $85,000
including $50,000 for
security and maintenance
due to the addition of
security personnel at the
mine site and the move to
the new office and dry
facility.
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(267) Foreign exchange (721) (63)% 81 (430)%
(losses)/gains arising on
the Gold Loan continued in
Q2/12 as a result of the
weakening of the Canadian
dollar against the US
dollar during the quarter.
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5,494 Mineral Properties. The 4,834 (13)% 4,212 (30)%
group incurred costs of
$7.1 million in the quarter
offset by revenue on gold
production of $2.5 million
(see further below). The
cost including labour costs
of $2.0 million, contractor
and material costs of $0.4
million, underground
development costs of $1.7
million depreciation of
$1.0 million and finance
costs of $1.4 million.
Finance costs include
actual cash cost of $0.2
million relating to
interest on the group's
Credit Facility and
equipment capital leases.
Q2/12 mineral properties
increased compared to Q1/12
due to construction timing
of mine site works and were
higher when compared to
Q2/11 due to the initial
ramp up commencing part way
through Q1/11.
Ming Mine Revenue of $2.5
million was realized in
Q2/12 on the sale and
settlement of 1,459 ounces
of gold with the Group's
third party refinery.
Revenues realized during
the testing and
commissioning of the Ming
Mine have been credited
against Mineral Property
and will continue until
commercial production is
achieved.
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3,992 Capital spending on 4,833 17% 9,017 56%
property, plant and
equipment decreased during
the quarter compared to
Q1/12 reflecting the
substantial completion of
the copper concentrator at
the Nugget Pond processing
facility offset by the
acquisition of a scoop tram
and mine truck for the
underground fleet.
The decrease from Q2/11 is
due to the reasons outlined
above and the overall
movement from capital
development into
production.
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248 Capital spending on 38 (553)% 16 (1450)%
exploration and evaluation
costs increased in Q2/12
compared to Q1/12
representing a full quarter
of consultancy expenditure
for the ongoing preliminary
economic assessment of the
Lower Footwall Zone of the
Ming Mine.
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(i)B/(W) = Better/(Worse)
SUMMARY OF QUARTERLY RESULTS
The quarterly results for the Group for the last eight fiscal quarters are set out in the following table.
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Quarterly Results
(All amounts in 000s of Canadian
Dollars, except Loss per share 4th 3rd 2nd 1st
figures) Quarter Quarter Quarter Quarter
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Fiscal 2012
Revenue -(i) 1,219
Net Income/(loss) (1,039) (845)
Loss per Share (Basic & Diluted) (0.008) (0.007)
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Fiscal 2011
Revenue 2,089 183 266 985
Net Income/(loss) 577 193 (555) (268)
Earnings/(loss) per Share (Basic &
Diluted) 0.008 0.002 (0.006) (0.003)
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Fiscal 2010
Revenue - -
Net Income/(loss) (676) (644)
Loss per Share (Basic & Diluted) (0.008) (0.008)
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(i)gold sales resulting from the testing and commissioning of the Ming Mine
are credited to Mineral Properties until commercial production is achieved
Losses in the fourth quarter of 2010 increased as a result of an unrealised exchange loss offset by reductions in legal and professional charges and staff costs. Losses in the first quarter of 2011 reduced as a result of revenue from toll processing and rose again in the second quarter of 2011 following the completion of a toll processing agreement in November 2010. The profit arising in Q3 2011 included an exchange gain of $0.8 million arising on the retranslation of the Gold Loan following the weakening of the US Dollar against the Canadian Dollar during the quarter. The profit arising in Q4 2011 arose from the profits realised on the sale of gold from the Group's satellite deposits. Losses increased in Q1/12 and further increased in Q2/12 as a result of an exchange loss of $0.7 million and $0.30 million respectively and reduced sales activity due to the processing of the Group's satellite deposits completed in Q1/12.
LIQUIDITY, CAPITAL RESOURCES AND FINANCIAL POSITION
To date the Group has relied on private placement financings of equity securities, a Gold Loan facility, capital leases and a credit facility (see 'Commitments and Loans' section) to finance its development requirements. Positive cash flows are expected to continue after production at the Ming Mine commences; however, there is no guarantee that expenses will not exceed income particularly during the start-up phase. If this is the case, the liquidity risk could be material, even with current cash resources.
The Group's holding of cash balances is kept under constant review. Given the current climate, the Group has taken a very risk averse approach to management of cash resources and Management and Directors monitor events and associated risks on a continuous basis. Cash and short-term investment resources (cash, cash equivalents and short-term investments) were as follows:
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Resource January 31, 2012 July 31, 2011
$'000 $'000
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Cash $CDN 3,411 8,661
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Cash $US 62 770
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Cash GBP 28 47
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Short-term Investments $CDN - 25
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Short-term Investments GBP 473 667
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Total 3,974 10,170
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Sales of gold and copper are likely to be made in US dollars and the majority of the Group's expenses are incurred in Canadian dollars. The Group's principal exchange rate risk relates to movements between the Canadian and US dollar. The Gold Loan is repayable in US dollars from future sales of gold mitigating the exchange risk. Management will closely monitor exchange fluctuation and consider the use of forward exchange contracts as required.
Interest rates on the capital leases and short term borrowings are fixed eliminating interest rate risk.
Net proceeds from financing activities during the quarter amounted to $1.2 million from receipts from a credit facility of $2.4 million net of financing fees offset by finance lease repayments of $0.4 million and repayments of the gold loan of $0.8 million.
Cash flows used in investing activities amounted to $5.0 million for the quarter. Investments included $5.1 million in mine development less $2.5 million proceeds received from the sale of gold, $1.7 million on the Nugget Pond Mill and $0.4 million on property, plant and equipment. The group is required to hold a Letter of Credit in favour of the Government of Newfoundland and Labrador in respect of the reclamation and closure liability at the existing Nugget Pond Mill and Ming Mine. At quarter end the Group holds bearer deposit notes totalling $3.26 million.
The Group's ability to continue as a going concern, and the recoverability of its mineral properties, is dependent on copper and gold prices, its ability to fund its development and exploration programs, and to manage and generate positive cash flows from current operations. To ensure sufficient working capital management has secured CAD$4.5 million through a non-brokered private placement (see note 12). Through the use of these placement funds, continued production during the commissioning phase and the unused credit facility balance of CAD $2.5 million management is satisfied that the Group has sufficient working capital for the forthcoming 12 months. However, there are risks associated with the commencement of a new mining and processing operation which may give rise to the possibility that additional working capital may be required to fund delays in commissioning the copper concentrator and continued mine development. Should additional working capital be required, the Directors consider that further sources of finance could be secured in the required timescale. On this basis, the Directors have concluded that the Group is a going concern; however, there is no certainty that these funds will be forthcoming. These financial statements do not reflect the adjustments to carrying values of assets and liabilities and the reported expenses and balance sheet classifications that would be necessary should the going concern assumption be inappropriate, and these adjustments could be material.
At March 22, 2012 the Group has $7.1 million in cash and cash equivalents.
Financial Instruments
The Group's financial instruments as at January 31, 2012 comprised of financial assets of cash and cash equivalents and trade and other receivables and financial liabilities comprised of trade payables; other payables; accrued expenses and interest bearing loans and borrowings.
All of the Group's financial liabilities are measured at amortised cost.
The board of directors determines, as required, the degree to which it is appropriate to use financial instruments and hedging techniques to mitigate risks. The main risks for which such instruments may be appropriate are foreign currency risk, liquidity risk, credit risk, interest rate risk and commodity price risk each of which is discussed in note 11 of the consolidated financial information for the quarter ended January 31, 2012. There were no derivative instruments outstanding at January 31, 2012.
COMMITMENTS AND LOANS
At January 31, 2012, a capital commitment made to a third party included:
----------------------------------------------------------------------------
Capital Commitment $000
----------------------------------------------------------------------------
Property, Plant and Equipment 795
----------------------------------------------------------------------------
TOTAL 795
----------------------------------------------------------------------------
This commitment will be financed through a capital lease financing agreement.
Gold Loan
In March 2010, the Group entered into an agreement ("Gold Loan") with Sandstorm to sell a portion of the life-of-mine gold production from its Ming Mine. Under the terms of the agreement Sandstorm made staged upfront cash payments for the gold to the Group totalling US$20 million.
For this, the Group has agreed to sell 32% of the payable gold in the first year of production. In each production year following the first year of production, until 175,000oz of payable gold has been produced, the Group has agreed to sell a percentage equal to 25% x (85% divided by the actual percentage of metallurgical recovery of gold realized in the immediately preceding production year) provided that, if the payable gold production in any production year after the third production year is less than 15,000 ounces, then in each such production year, Sandstorm payable gold shall not be less than 25% of the payable gold. In each production year following the first year of production, after 175,000oz of payable gold has been produced, the Group has agreed to sell a percentage equal to 12% x (85% divided by the actual percentage of metallurgical recovery of gold realized in the immediately preceding production year) provided that, if the payable gold production in any production year after the third production year is less than 15,000 ounces, then in each such production year, Sandstorm payable gold shall not be less than 12% of the payable gold for the remainder of the period ending 40 years after the date of the agreement. After the expiry of the 40 year term, the agreement is renewable in 10 year terms at the option of Sandstorm.
The remaining circumstances in which the Gold Loan may be repaid earlier than by the delivery of payable gold are as follows:
i. If within 24 months of the date that gold is first produced (November
28, 2011), the Ming Mine has not produced and sold a minimum of 24,000oz
of payable gold then a portion of the US$20 million will be repayable
based on the shortfall of payable gold, and/or;
ii. Within the first 36 months of commercial production of gold any
shortfall in the value of payable gold below the following amounts will
be required to be paid in cash:
-- within the first 12 months - US$3.6 million
-- within the second 12 months - US$3.6 million
-- within the third 12 months - US$3.1 million
Credit Facility
On September 29, 2011 the Group agreed a Credit Facility of up to CAD$10 million with Sprott Resource Lending Partnership ('Sprott') for use as additional funding for the development of the Ming Mine. Subsequent to amending the agreement in December 2011 the facility is available in three instalments; the first instalment of $5 million was drawn on October 29, 2011, the second instalment of $2.5 million was drawn on January 30, 2012 and the final instalment for the balance up to $10 million is available until August 31, 2012 Interest will accrue at a fixed rate of 9.25% per annum, principle repayable by March 29, 2013 and secured by a fixed and floating charge over the assets of the Group. In connection with the Credit Facility, a Structuring Fee of CAD$100,000 and a 3% Commitment Fee of CAD$300,000 were paid to Sprott in cash. Pursuant to the terms of the Credit Facility, the Company issued CAD$300,000 of ordinary shares of 1p each in the capital of the Company to Sprott in exchange for the repayment of the previously paid cash Commitment Fee. In addition, a further 4% Drawdown Fee on all amounts drawn under the Credit Facility is to be satisfied by the issue of ordinary shares by the Company.
Loan and lease balances
At January 31, 2012, interest bearing loans and borrowings comprised a Gold Loan of $21,745,000, finance lease commitments of $7,827,000, a credit facility of $6,497,000 and a bank loan of $27,000. The Group entered into finance lease commitments of $1,646,000 to finance the acquisition of a scoop tram and mine truck in the quarter.
SUBSEQUENT EVENTS
On February 8, 2012 the Group announced the purchase of Ming Mine's 2% net smelter royalty held by Philippine Metals Inc., formerly Meridian Mining Corporation, for CAD$600,000. Before the buyout the mine had a 4.5% combined net smelter royalty held by four separate groups. Arrangements are also being considered to buyout a further 1% net smelter royalty for CAD$500,000. Following the buyout of the 1% net smelter royalty the Ming Mine's net smelter royalty will be 1.5%.
On February 15, 2012 the Group completed an acquisition of 4,500,000 shares of Maritime Resources Corp (TSX VENTURE:MAE) ('Maritime') through a non-brokered private transaction priced at $0.23 per share for a total consideration of $1,035,000. The acquisition gives Rambler a 17% equity stake and an invite to appoint a representative to join Maritime's Board of Directors. Maritime continues to advance the Green Bay portfolio of properties, specifically the Hammerdown mine, and the Orion and Lochinvar deposits.
On March 6, 2012 Rambler announced that it had accepted an offer from Tinma International Ltd. ('Tinma'), a wholly-owned subsidiary of a China-based investor, to become a strategic shareholder in Rambler through a non-brokered private placement by entering into a conditional subscription agreement. Subsequently on March 19, 2012 Rambler announced the closing of the private placement resulting in the issuance of 10,403,980 ordinary shares to Tinma at a placing price of CAD $0.44 per ordinary share for total proceeds of $4.58 million. Combined with current holding this placement brings Tinma's total shareholdings in Rambler to 13,388,980 ordinary shares representing approximately 9.9 per cent of the issued share capital of Rambler, on a post-closing basis.
On March 15, 2012 the Group announced the completion of a preliminary economic assessment ('PEA') to include the Lower Footwall Zone mineralization in its mine plan. This assessment evaluated the potential for an expansion program at the Ming Mine to first optimize the current high grade operation followed by a transition into a 20+ year bulk tonnage operation through a four year ramp-up period increasing the current ore throughput of 630 mtpd to 3,500 mtpd. Numerous opportunities exist to improve the business case. It is these areas that future optimization and engineering studies will focus on to ensure that if or when the decision is made to proceed with the expansion, the project will benefit from the upside of the existing operation. PEA results include: pre-tax Net present value of US$251 million; internal rate of return of 18%, undiscounted pre-tax cash flow from operations of $861 million and initial capital requirements of US$231 million.
APPENDIX 1 - LOCATION MAP: http://media3.marketwire.com/docs/LocationMapRamblerMetalsandMining.pdf
APPENDIX 2 - SELECTED FINANCIAL INFORMATION & REVIEW OF OVERALL PERFORMANCE
----------------------------------------------------------------------------
Financial Highlights
(All amounts in 000s of Canadian
Dollars, except shares and per share
figures) Three months ended,
---------------------------------------
January 31, October 31, January 31,
2012 2011 2011
----------------------------------------------------------------------------
Gold sales (ounces) 1,459(i) 695 -
Average price CAD (per ounce) 1,662(i) 1,700 -
----------------------------------------------------------------------------
Revenue - 1,219 266
Operating Expenses - (674) (198)
Exploration Expenditure (6) (6) (31)
Administrative expenses (783) (694) (698)
Net loss (1,039) (845) (555)
Cash Flow generated by/used in
operating activities (530) 1,284 (979)
Cash Flow used in investing
activities (4,983) (7,438) (8,248)
Cash Flow from financing activities 1,230 4,194 6,585
Net (decrease)/increase in cash (4,283) (1,960) (2,642)
Cash and cash equivalents at end of
period 3,974 8,257 4,865
----------------------------------------------------------------------------
Total Assets 106,670 102,449 68,909
Total Liabilities (46,010) (40,769) (22,758)
Working Capital (4,005) 4,664 3,324
----------------------------------------------------------------------------
Weighted average number of shares
outstanding 123,650 123,361 95,515
Loss per share (0.008) (0.007) (0.006)
----------------------------------------------------------------------------
(i)gold sales relating to the testing and commissioning of the Ming Mine are
credited to Mineral Properties until commercial production is achieved.
APPENDIX 3 - CRITICAL ACCOUNTING POLICIES AND ESTIMATES
The details of the Group's accounting policies are presented in accordance with International Financial Reporting Standards as set out in Note 2 to the financial statements. The preparation of financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the year.
The following estimates are considered by management to be the most critical for investors to understand some of the processes and reasoning that go into the preparation of the Group's financial statements, providing some insight also to uncertainties that could impact the Group's financial results.
Going Concern
The Group's ability to continue as a going concern, and the recoverability of its mineral properties, is dependent on copper and gold prices, its ability to fund its development and exploration programs, and to manage and generate positive cash flows from current operations. To ensure sufficient working capital management has secured CAD$4.5 million through a non-brokered private placement (see note 12). Through the use of these placement funds, continued production during the commissioning phase and the unused credit facility balance of CAD $2.5 million management is satisfied that the Group has sufficient working capital for the forthcoming 12 months. However, there are risks associated with the commencement of a new mining and processing operation which may give rise to the possibility that additional working capital may be required to fund delays in commissioning the copper concentrator and continued mine development. Should additional working capital be required, the Directors consider that further sources of finance could be secured in the required timescale. On this basis, the Directors have concluded that the Group is a going concern; however, there is no certainty that these funds will be forthcoming. These financial statements do not reflect the adjustments to carrying values of assets and liabilities and the reported expenses and balance sheet classifications that would be necessary should the going concern assumption be inappropriate, and these adjustments could be material.
Share-based payments
The Group calculates the cost of share based payments using the Black-Scholes model. Inputs into the model in respect of the expected option life and the volatility are subject to management estimate and any changes to these estimates may have a significant effect on the cost. The assumptions used in calculating the cost of share based payments are explained in note 10 of the financial statements for the period ended January 31, 2012.
Gold Loan
The Group calculates the effective interest rate on the Gold Loan based on estimates of future cash flows arising from the sale of payable gold (see note 7 to the Unaudited Consolidated Financial Information for the quarter ended January 31, 2012).The cash flows will be dependent on the production of gold and its selling price at the time of delivery which have been estimated in line with the mine plan, future prices of gold and reserve estimates. Management's estimates of these factors are subject to risk and uncertainties affecting the amount of the interest charge. Any changes to these estimates may result in a significantly different interest charge which would affect the carrying value of the exploration and evaluation costs and the corresponding Gold Loan liability.
Mineral Property and Exploration and Evaluation Costs
The directors have assessed whether there are any indicators of impairment in respect of mineral property and exploration and evaluation costs. In making this assessment they have considered the Group's business plan which includes resource estimates, future processing capacity, the forward market and longer term price outlook for copper and gold. Resource estimates have been based on the most recently filed NI43-101 report and its opportunities economic model which includes resource estimates and conversion of its inferred resources. Management's estimates of these factors are subject to risk and uncertainties affecting the recoverability of the Group's mineral property and exploration and evaluation costs. Any changes to these estimates may result in the recognition of an impairment charge with a corresponding reduction in the carrying value of such assets. After consideration of the above factors, the directors do not consider that there are any indicators that mineral property and exploration and evaluation costs are impaired at the quarter end.
Closure Costs
The Group has an obligation to reclaim its properties after the minerals have been mined from the site, and has estimated the costs necessary to comply with existing reclamation standards. These estimates are recorded as a liability at their fair values in the periods in which they occur. If the estimate of reclamation costs proves to be inaccurate, the Group could be required to increase the provision for site closure and reclamation costs, which would increase the amount of future reclamation expense, resulting in a reduction in the Group's earnings and net assets.
CHANGES IN ACCOUNTING POLICIES
In the current quarter, new and revised standards which have been adopted have not affected the disclosures presented in these financial statements.
No standards issued but not yet effective have been adopted early.
International Financial Reporting Standards that have recently been issued or amended but are not yet effective have not been adopted for the annual reporting period ended July 31, 2012:
IFRS/ Title Nature of change to Application Application
Amendment accounting policy date of date for
standard Group
----------------------------------------------------------------------------
Various Annual Improvements No change to Various August 1,
to IFRSs accounting policy, 2012
therefore, no
impact
----------------------------------------------------------------------------
IFRS 9 Financial No change to January 1, August 1,
instruments: accounting policy, 2015 2015
Classification and therefore, no
Measurement impact
----------------------------------------------------------------------------
IFRS 10 Consolidated No change to January 1, January 1,
Financial accounting policy, 2013 2013
Statements therefore, no
impact
----------------------------------------------------------------------------
IFRS 11 Joint Arrangements No change to January 1, January 1,
accounting policy, 2013 2013
therefore, no
impact
----------------------------------------------------------------------------
IFRS 12 Disclosure of No change to January 1, January 1,
Interests in Other accounting policy, 2013 2013
Entities therefore, no
impact
----------------------------------------------------------------------------
IFRS 13 Fair Value No change to January 1, January 1,
Measurement accounting policy, 2013 2013
therefore, no
impact
----------------------------------------------------------------------------
Management have reviewed the impact of the above standards and interpretations and have concluded that they will not result in any material changes to reported results.
Details of the main accounting policies of the Group are included in note 2 of the financial statements for the year ended July 31, 2011
APPENDIX 4 - OTHER MATTERS
Outstanding Share & Option Data
As at the date of this MD&A the following securities are outstanding:
----------------------------------------------------------------------------
Security Shares issued or Issuable Weighted Average Exercise Price
----------------------------------------------------------------------------
Common Shares 135,242,228 --
----------------------------------------------------------------------------
Options 3,797,000(i) $0.48
----------------------------------------------------------------------------
(i)if all options have fully vested
For further assistance Mr. Peter Mercer, Corporate Secretary can be reached directly at +1-709-800-1929 ext. 500 or pmercer@ramblermines.com.
Forward Looking Information
This MD&A contains "forward-looking information" which may include, but is not limited to, statements with respect to the Group's objectives and strategy, future financial or operating performance of the Group and its projects, 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 exploration and development, environmental risks, title disputes or claims and limitations of insurance coverage. All statements, other than statements of historical fact, are forward-looking statements. 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 are necessarily based on a number of estimates and assumptions that, while considered reasonably by the Company, involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Group to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, general business, economic, competitive, political and social uncertainties; the actual results of current exploration activities; conclusions of economic evaluations; availability and cost of credit; fluctuations in Canadian dollar interest rates; fluctuations in the relative value of United States dollars, Canadian dollars and British Pounds; changes in planned parameters as plans continue to be refined; fluctuations in the market and forward prices of copper, gold, silver or certain other commodities; possible variations of ore grade or recovery rates;
failure of equipment; accidents and other risks of the mining exploration industry; political instability, insurrection or war; delays in obtaining governmental approvals or financing or in the completion of development or construction activities, as well as those factors discussed in the section entitled "Risk Factors" in the Report of Directors. Although the Group 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. Unless stated otherwise, forward-looking statements contained herein are made as of the date of this MD&A. Other than as required by applicable securities law, the Company disclaims any obligation to update any forward-looking statements, whether as a result of new information, 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. All of the forward-looking statements made in this MD&A are qualified by these cautionary statements. Accordingly, readers should not place undue reliance on forward-looking statements.
Further information
Additional information relating to the Group is on SEDAR at www.sedar.com and on the Group's web site at www.ramblermines.com.
RAMBLER METALS & MINING PLC
Unaudited Consolidated Financial Information
For the Quarter Ended 31 January 2012
The accompanying financial information for the quarter ended 31 January 2012 and 31 January 2011 has not been reviewed or audited by the Group's auditor and has an effective date of 22 March 2012.
Rambler Metals and Mining Plc
Unaudited Consolidated income statement
For the Quarter Ended 31 January 2012
(EXPRESSED IN CANADIAN DOLLARS)
Quarter ended Quarter ended Six months Six months
31 January 31 January ended 31 ended 31
2012 2011 January 2012 January 2011
$,000 $,000 $,000 $,000
Revenue - 266 1,219 1,251
Cost of sales - (198) (674) (809)
--------------------------------------------------------
Gross profit - 68 545 442
Administrative
expenses (783) (698) (1,477) (1,381)
Exploration expenses (6) (31) (12) (59)
--------------------------------------------------------
Operating loss (789) (661) (944) (998)
--------------------------------------------------------
Bank interest
receivable 20 14 53 32
Finance costs (3) (18) (5) (31)
Foreign exchange
differences (267) 81 (988) 145
--------------------------------------------------------
Net financing
(expense) income (250) 77 (940) 146
--------------------------------------------------------
Loss before tax (1,039) (584) (1,884) (852)
Income tax credit - 29 - 29
--------------------------------------------------------
Loss for the period
and attributable to
owners of the
parent (1,039) (555) (1,884) (823)
--------------------------------------------------------
--------------------------------------------------------
Loss per share
Quarter ended Quarter ended Six months Six months
31 January 31 January ended 31 ended 31
2012 2011 January 2012 January 2011
$ $ $ $
Basic and diluted
loss per share (0.008) (0.006) (0.015) (0.009)
--------------------------------------------------------
Rambler Metals and Mining Plc
Unaudited Consolidated statement of comprehensive income
For the Quarter Ended 31 January 2012
(EXPRESSED IN CANADIAN DOLLARS)
Quarter ended Quarter ended Six months Six months
31 January 31 January ended 31 ended 31
2012 2011 January 2012 January 2011
$,000 $,000 $,000 $,000
Loss for the period (1,039) (555) (1,884) (823)
--------------------------------------------------------
Exchange differences
on translation of
foreign operations
(net of tax) (2) (10) 10 (6)
--------------------------------------------------------
Other comprehensive
income for the
period (2) (10) 10 (6)
--------------------------------------------------------
--------------------------------------------------------
Total comprehensive
loss for the period
and attributable to
the owners of the
parent (1,041) (565) (1,874) (829)
--------------------------------------------------------
--------------------------------------------------------
Rambler Metals and Mining Plc
Consolidated balance sheet
As at 31 January 2012
(EXPRESSED IN CANADIAN DOLLARS)
Note Unaudited Audited
31 January 2012 31 July 2011
$,000 $,000
Assets
Intangible assets 3 16,913 16,627
Mineral properties 4 48,796 38,468
Property, plant and equipment 5 32,063 25,332
-----------------------------------
Total non-current assets 97,772 80,427
-----------------------------------
Inventory 6 894 934
Trade and other receivables 625 1,565
Cash and cash equivalents 3,974 10,170
Restricted cash 3,405 3,377
-----------------------------------
Total current assets 8,898 16,046
-----------------------------------
Total assets 106,670 96,473
-----------------------------------
-----------------------------------
Equity
Issued capital 2,317 2,299
Share premium 66,420 65,934
Merger reserve 214 214
Translation reserve 145 135
Accumulated losses (8,436) (6,604)
-----------------------------------
Total equity 60,660 61,978
-----------------------------------
Liabilities
Interest-bearing loans and
borrowings 7 31,535 24,606
Provision 8 1,572 1,647
-----------------------------------
Total non-current liabilities 33,107 26,253
-----------------------------------
Interest-bearing loans and
borrowings 7 4,561 2,282
Trade and other payables 8,342 5,960
-----------------------------------
Total current liabilities 12,903 8,242
-----------------------------------
Total liabilities 46,010 34,495
-----------------------------------
Total equity and liabilities 106,670 96,473
-----------------------------------
-----------------------------------
Rambler Metals and Mining Plc
Consolidated Statement of Changes in Equity
Share Share Merger Translation Accumulated
capital premium reserve reserve Losses Total
(EXPRESSED IN
CANADIAN DOLLARS) $,000 $,000 $,000 $,000 $,000 $,000
Group
Audited
Balance at 1 August
2010 1,863 51,532 214 25 (6,811) 46,823
---------------------------------------------------------
Comprehensive loss
Loss for the year - - - - (53) (53)
---------------------------------------------------------
Foreign exchange
translation
differences - - - 110 - 110
---------------------------------------------------------
Other comprehensive
loss - - - 110 - 110
---------------------------------------------------------
Total comprehensive
loss for the year - - - 110 (53) 57
---------------------------------------------------------
Transactions with
owners
Issue of share
capital 436 15,252 - - - 15,688
Share issue
expenses - (850) - - - (850)
Share-based
payments - - - - 260 260
---------------------------------------------------------
Transactions with
owners 436 14,402 - - 260 15,098
---------------------------------------------------------
Balance at 31 July
2011 2,299 65,934 214 135 (6,604) 61,978
---------------------------------------------------------
---------------------------------------------------------
Unaudited
Balance at 1 August
2011 2,299 65,934 214 135 (6,604) 61,978
---------------------------------------------------------
Comprehensive loss
Loss for the period - - - - (1,884) (1,884)
---------------------------------------------------------
Foreign exchange
translation
differences - - - 10 - 10
---------------------------------------------------------
Other comprehensive
loss - - - 10 - 10
---------------------------------------------------------
Total comprehensive
income for the
period - - - 10 (1,884) (1,874)
---------------------------------------------------------
Transactions with
owners
Issue of share
capital 18 486 - - - 504
Share-based
payments - - - - 52 52
---------------------------------------------------------
Transactions with
owners 18 486 - - 52 556
---------------------------------------------------------
Balance at 31
January 2012 2,317 66,420 214 145 (8,436) 60,660
---------------------------------------------------------
---------------------------------------------------------
Rambler Metals and Mining Plc
Unaudited statements of cash flows
For the Quarter Ended 31 January 2012
(EXPRESSED IN CANADIAN DOLLARS)
Quarter ended Quarter ended Six months Six months
31 January 31 January ended 31 ended 31
2012 2011 January 2012 January 2011
$,000 $,000 $,000 $,000
Cash flows from
operating
activities
Operating loss (789) (661) (944) (998)
Depreciation 54 18 103 57
Share based
payments 16 45 47 143
Exchange
differences - (62) - (115)
Decrease/
(increase) in
inventory (262) (26) 40 (109)
Decrease/
(increase) in
receivables 360 (388) 939 (949)
Increase/
(decrease) in
payables 94 84 574 511
--------------------------------------------------------
Cash generated
from/(utilised
in) operations (527) (990) 759 (1,460)
Interest paid (3) (18) (5) (31)
Income tax
received - 29 - 29
--------------------------------------------------------
Net cash generated
from/(utilised
for) operating
activities (530) (979) 754 (1,462)
--------------------------------------------------------
Cash flows from
investing
activities
Interest received 20 14 53 32
Acquisition of
bearer deposit
note - (81) (28) (593)
Acquisition of
evaluation and
exploration
assets (286) (17) (313) (251)
Acquisition of
mineral
properties (2,578) (3,888) (5,936) (4,589)
Acquisition of
property, plant
and equipment (2,139) (4,276) (6,197) (4,788)
--------------------------------------------------------
Net cash utilised
in investing
activities (4,983) (8,248) (12,421) (10,189)
--------------------------------------------------------
Cash flows from
financing
activities
Proceeds from
issue of share
capital - 6 - 6
Proceeds from
exercise of share
options 4 2 8 8
Proceeds from
Loans (note 7) 2,446 6,685 6,970 8,697
Repayment of gold
loan (778) - (778) -
Capital element of
finance lease
payments (442) (108) (776) (202)
--------------------------------------------------------
Net cash from
financing
activities 1,230 6,585 5,424 8,509
--------------------------------------------------------
Net decrease in
cash and cash
equivalents (4,283) (2,642) (6,243) (3,142)
Cash and cash
equivalents at
beginning of
period 8,257 7,493 10,170 8,000
Effect of exchange
rate fluctuations
on cash held - 14 47 7
--------------------------------------------------------
Cash and cash
equivalents at
end of period 3,974 4,865 3,974 4,865
--------------------------------------------------------
--------------------------------------------------------
Rambler Metals and Mining Plc
Unaudited Notes to the financial statements
1. Nature of operations and going concern
The principal activity of the Group is the development and exploration programme of the Ming Copper-Gold Mine in Baie Verte, Newfoundland and Labrador, Canada.
The Group's ability to continue as a going concern, and the recoverability of its mineral properties, is dependent on copper and gold prices, its ability to fund its development and exploration programs, and to manage and generate positive cash flows from current operations. To ensure sufficient working capital management has secured CAD$4.5 million through a non-brokered private placement (see note 12). Through the use of these placement funds, continued production during the commissioning phase and the unused credit facility balance of CAD $2.5 million, management is satisfied that the Group has sufficient working capital for the forthcoming 12 months. However, there are risks associated with the commencement of a new mining and processing operation which may give rise to the possibility that additional working capital may be required to fund delays in commissioning the copper concentrator and continued mine development. Should additional working capital be required, the Directors consider that further sources of finance could be secured in the required timescale. On this basis, the Directors have concluded that the Group is a going concern; however, there is no certainty that these funds will be forthcoming. These financial statements do not reflect the adjustments to carrying values of assets and liabilities and the reported expenses and balance sheet classifications that would be necessary should the going concern assumption be inappropriate, and these adjustments could be material.
2. Accounting policies
Details of the main accounting policies of the Group are included in note 2 of the financial statements for the year ended 31 July 2011.
3. Intangible assets
Exploration and
evaluation
Costs
$,000
Cost
Balance at 1 August 2010 37,051
Acquisitions 478
Transfer to mineral properties (20,902)
-------------------------
Balance at 31 July 2011 16,627
-------------------------
-------------------------
Balance at 1 August 2011 16,627
Acquisitions 286
-------------------------
Balance at 31 January 2012 16,913
-------------------------
-------------------------
Carrying amounts
At 31 July 2011 16,627
-------------------------
-------------------------
At 31 January 2012 16,913
-------------------------
-------------------------
4. Mineral Properties
Mineral Property $,000
Cost
Balance at 1 August 2010 -
Transfer from exploration and evaluation costs 20,902
Acquisitions 17,566
-------------------------
Balance at 31 July 2011 38,468
-------------------------
-------------------------
Balance at 1 August 2011 38,468
Acquisitions 10,328
-------------------------
Balance at 31 January 2012 48,796
-------------------------
-------------------------
Carrying amounts
At 31 July 2011 38,468
-------------------------
-------------------------
At 31 January 2012 48,796
-------------------------
-------------------------
Included in current period acquisitions are $2.479 million in gold sales realized as part of the commissioning of 1806 ores through the Nugget Pond Mill.
5. Property, plant and equipment
Land and Assets under Plant and
buildings construction Motor vehicles equipment
$,000 $,000 $,000 $,000
Cost
Balance at 1
August 2010 1,096 5,200 118 6,038
Acquisitions 1,845 10,110 74 8,127
Disposals - - (39) -
-------------------------------------------------------------
Balance at 31
July 2011 2,941 15,310 153 14,165
-------------------------------------------------------------
Balance at 1
August 2011 2,941 15,310 153 14,165
Additions 662 5,831 85 2,161
Disposals - - (39) -
-------------------------------------------------------------
Balance at 31
January 2012 3,603 21,141 199 16,326
-------------------------------------------------------------
Depreciation
and impairment
losses
Balance at 1
August 2010 775 - 51 4,382
Depreciation
charge 151 - 40 2,070
Eliminated on
disposals - - (20) -
-------------------------------------------------------------
Balance at 31
July 2011 926 - 71 6,452
-------------------------------------------------------------
Balance at 1
August 2011 926 - 71 6,452
Depreciation
charge 160 - 48 1,777
On disposals - - (20) -
Balance at 31
January 2012 1,086 - 99 8,229
-------------------------------------------------------------
Carrying
amounts
At 31 July 2011 2,015 15,310 82 7,713
-------------------------------------------------------------
At 31 January
2012 2,517 21,141 100 8,097
-------------------------------------------------------------
Fixtures,
fittings and Computer
equipment equipment Total
$,000 $,000 $,000
Cost
Balance at 1
August 2010 56 540 13,048
Acquisitions 34 130 20,320
Disposals - - (39)
-----------------------------------------------
Balance at 31
July 2011 90 670 33,329
-----------------------------------------------
Balance at 1
August 2011 90 670 33,329
Additions 3 83 8,825
Disposals - (7) (46)
-----------------------------------------------
Balance at 31
January 2012 93 746 42,108
-----------------------------------------------
Depreciation
and impairment
losses
Balance at 1
August 2010 44 335 5,587
Depreciation
charge 13 156 2,430
Eliminated on
disposals - - (20)
-----------------------------------------------
Balance at 31
July 2011 57 491 7,997
-----------------------------------------------
Balance at 1
August 2011 57 491 7,997
Depreciation
charge 8 81 2,074
On disposals - (6) (26)
Balance at 31
January 2012 65 566 10,045
-----------------------------------------------
Carrying
amounts
At 31 July 2011 33 179 25,332
-----------------------------------------------
At 31 January
2012 28 180 32,063
-----------------------------------------------
6. Inventories
31 January 2012 31 July 2011
$,000 $,000
Metals in process - 540
Operating supplies 894 394
-----------------------------------
894 934
-----------------------------------
-----------------------------------
7. Interest-bearing loans and borrowings
This note provides information about the contractual terms of the Group's interest-bearing loans and borrowings. For more information about the Group's exposure to interest rate and foreign currency risk, see note 11.
31 January 2012 31 July 2011
$,000 $,000
Non-current liabilities
Bank loan 24 26
Finance lease liabilities 6,019 5,326
Gold Loan 18,995 19,254
Credit Facility 6,497 -
-----------------------------------
31,535 24,606
-----------------------------------
-----------------------------------
Current liabilities
Current portion of bank loan 3 3
Current portion of finance lease
liabilities 1,808 1,630
Current portion of Gold Loan 2,750 649
-----------------------------------
4,561 2,282
-----------------------------------
-----------------------------------
Finance lease liabilities
Finance lease liabilities are payable as follows:
Minimum Minimum
lease lease
Payments Interest Principal Payments Interest Principal
31 January 31 January 31 January 31 July 31 July 31 July
2012 2012 2012 2011 2011 2011
$,000 $,000 $,000 $,000 $,000 $,000
Less than one
year 2,155 347 1,808 1,965 335 1,630
Between one
and five
years 6,635 616 6,019 5,918 592 5,326
--------------------------------------------------------------
8,790 963 7,827 7,883 927 6,956
--------------------------------------------------------------
--------------------------------------------------------------
Under the terms of the equipment lease agreements, no contingent rents are payable.
The bank loan is secured by way of a fixed charge over a property and is repayable in monthly instalments of $384 over 12 years.
Gold Loan
In March 2010, the Group entered into an agreement ("Gold Loan") with Sandstorm to sell a portion of the life-of-mine gold production from its Ming Mine.
Under the terms of the agreement Sandstorm made staged upfront cash payments for the gold to the Group totalling US$20 million.
For this, the Group has agreed to sell 32% of the payable gold in the first year of production. In each production year following the first year of production, until 175,000oz of payable gold has been produced, the Group has agreed to sell a percentage equal to 25% x (85% divided by the actual percentage of metallurgical recovery of gold realized in the immediately preceding production year) provided that, if the payable gold production in any production year after the third production year is less than 15,000 ounces, then in each such production year, Sandstorm payable gold shall not be less than 25% of the payable gold. In each production year following the first year of production, after 175,000oz of payable gold has been produced, the Group has agreed to sell a percentage equal to 12% x (85% divided by the actual percentage of metallurgical recovery of gold realized in the immediately preceding production year) provided that, if the payable gold production in any production year after the third production year is less than 15,000 ounces, then in each such production year, Sandstorm payable gold shall not be less than 12% of the payable gold for the remainder of the period ending 40 years after the date of the agreement. After the expiry of the 40 year term, the agreement is renewable in 10 year terms at the option of Sandstorm.
A 4.5% cash commission was payable with each payment received under the agreement.
The remaining circumstances in which the Gold Loan may be repaid earlier than by the delivery of payable gold are as follows:
i. If within 24 months of the date that gold is first produced (November
28, 2011), the Ming Mine has not produced and sold a minimum of 24,000oz
of payable gold then a portion of the US$20 million will be repayable
based on the shortfall of payable gold.
ii. Within the first 36 months of commercial production of gold any
shortfall in the value of payable gold below the following amounts will
be required to be paid in cash:
-- within the first 12 months - US$3.6 million
-- within the second 12 months - US$3.6 million
-- within the third 12 months - US$3.1 million
The Gold Loan is accounted for as a financial liability carried at amortised cost. In determining the effective interest rate implicit in the cash flows arising from the loan the cash flows are forecast at each quarter end based on management's best estimates of the time of delivery of payable gold, the total amount of gold expected to be produced over the mine life and the timing of that production.
During the period, repayments of US$767,872 were made from the delivery of 467oz of gold.
Total interest of $1,595,252 was accrued during the period. $nil (2011: $49,906) was included in exploration and evaluation expenditure and $1,595,252 (2011: $1,451,371) charged to mineral properties.
The Gold Loan is secured by a fixed and floating charge over the assets of the Group.
Credit Facility
On September 29, 2011 the Group agreed a Credit Facility of up to CAD$10 million with Sprott Resource Lending Partnership ("Sprott") for use as additional funding for the development of the Ming Mine. Subsequent to amending the agreement in December 2011 the facility is available in three instalments; the first instalment of $5 million was drawn on October 29, 2011, the second instalment of $2.5 million was drawn on January 30, 2012 and the final instalment for the balance up to $10 million is available until August 31, 2012. Interest will accrue at a fixed rate of 9.25% per annum, principle repayable by March 29, 2013 and secured by a fixed and floating charge over the assets of the Group. In connection with the Credit Facility, a Structuring Fee of CAD$100,000 and a 3% Commitment Fee of CAD$300,000 were paid to Sprott in cash. Pursuant to the terms of the Credit Facility, the Company issued CAD$300,000 of ordinary shares of 1p each in the capital of the Company to Sprott in exchange for the repayment of the previously paid cash Commitment Fee. In addition, a further 4% Drawdown Fee on all amounts drawn under the Credit Facility is to be satisfied by the issue of ordinary shares by the Company.
8. Provisions
31 January 2012 31 July 2011
$,000 $,000
Reclamation and closure provision
At 1 July 2011 1,647 559
(Released)/provided during the period (121) 1,007
Unwinding of discount 46 81
------------------------------------
At 31 January 2012 1,572 1,647
------------------------------------
------------------------------------
The reclamation and closure provision has been made in respect of costs of land restoration and rehabilitation expected to be incurred at the end of the Ming Mine's useful life. The provision has been calculated based on the present value of the expected future cash flows associated with reclamation and closure activities as required by the Government of Newfoundland and Labrador. The provision relates to restoration of all three sites associated with the Ming Mine project: mill, mine and port sites. The liability is secured by Letters of Credit for $3,255,155.
9. Related parties
Transactions with key management personnel
Total key management personnel compensation was as follows:
Six months Six months
Quarter ended 31 Quarter ended 31 ended 31 ended 31
January 2012 January 2011 January 2012 January 2011
$,000 $,000 $,000 $,000
Short term
employee
benefits 178 130 336 233
Share
based
payments - 15 13 40
------------------------------------------------------------------
178 145 349 273
------------------------------------------------------------------
------------------------------------------------------------------
10. Share-based payments
The number and weighted average exercise prices of share options are as follows:
Weighted Weighted
average average
exercise Number exercise Number
price of options price of options
31 January 31 January 31 July 31 July
2012 2012 2011 2011
$ No. 000 $ No. 000
Outstanding at the
beginning of the period 0.484 4,167 0.467 3,952
Granted during the period 0.476 284 0.506 647
Exercised 0.187 (67) 0.186 (52)
Cancelled during the
period 0.766 (431) 0.379 (380)
--------------- ---------------
Outstanding at the end of
the period 0.454 3,953 0.484 4,167
--------------- ---------------
--------------- ---------------
Exercisable at the end of
the period 0.444 3,481 0.495 3,077
--------------- ---------------
--------------- ---------------
The options outstanding at 31 January 2012 have an exercise price in the range of $0.16 to $1.10 and a weighted average remaining contractual life of 7.2 years (31 July 2011: 8 years).
The fair value of services received in return for share options granted are measured by reference to the fair value of share options granted. The estimate of the fair value of the services received is measured based on the Black-Scholes model. The contractual life of the option (10 years) is used as an input into this model. Expectations of early exercise are incorporated into the Black-Scholes model.
10. Share-based payments
Fair value of
share options Quarter ended Quarter ended Six months Six months
and 31 January 31 January ended 31 ended 31
assumptions 2012 2011 January 2012 January 2011
$,000 $,000 $,000 $,000
Fair value at
measurement
date of
options
granted in the
period 20 16 79 116
-------------------------------------------------------------
Weighted
average fair
value per
option granted
in period 0.249 0.380 0.279 0.275
Share price
(weighted
average) 0.435 0.600 0.476 0.452
Exercise price
(weighted
average) 0.435 0.600 0.476 0.452
Expected
volatility
(expressed as
weighted
average
volatility
used in the
modelling
under Black-
Scholes model) 68.8% 80.0% 69.6% 75.5%
Expected option
life 5 5 5 5
Expected
dividends 0 0 0 0
Risk-free
interest rate
(based on
national
government
bonds) 1.23% 2.50% 1.87% 2.50%
-------------------------------------------------------------
The expected volatility is based on the historic volatility (calculated based on the weighted average remaining life of the share options), adjusted for any expected changes to future volatility due to publicly available information.
There are no performance or market conditions associated with the share option grants.
Six months Six months
Quarter ended 31 Quarter ended 31 ended 31 ended 31
January 2012 January 2011 January 2012 January 2011
$,000 $,000 $,000 $,000
Total expense
recognised as
employee
costs 16 45 47 143
--------------------------------------------------------------
--------------------------------------------------------------
11. Financial risk management
The Group's principal financial assets comprise: cash and cash equivalents and other receivables. The Group financial liabilities comprise: trade payables; other payables; and accrued expenses. The Group's financial liabilities also include interest bearing loans and borrowings.
All of the Group's financial liabilities are measured at amortised cost and their financial assets are classified as loans and receivables and measured at amortised cost.
The board of directors determines, as required, the degree to which it is appropriate to use financial instruments and hedging techniques to mitigate risks. The main risks for which such instruments may be appropriate are foreign exchange risk, interest rate risk, credit risk and liquidity risk each of which is discussed below. There were no derivative instruments outstanding at 31 January 2012.
Foreign currency risk
The Group's cash resources are held in GB pounds and Canadian Dollars and the Gold Loan is repayable in US dollars. The Group has a downside exposure to any strengthening of the GB pound as this would increase expenses in Canadian dollar terms. This risk is mitigated by reviewing the holding of cash balances in GB pounds. Any weakening of the GB pound would however result in the reduction of the expenses in Canadian dollar terms and preserve the Group's cash resources. In addition, any such movements would affect the Consolidated Balance Sheet when the net assets of the Parent Company are translated into Canadian dollars. The Group has a downside exposure to any strengthening of the US dollar as this would increase the amount repayable on the Gold Loan in Canadian dollar terms. This risk, however, is relevant only should the Gold Loan be repaid in cash under terms set out in note 7. Repayment is envisaged in payable gold which is denominated in US dollars. Once the Mine is in production, this will mitigate this foreign currency risk.
The Group does not hedge its exposure of foreign investments held in foreign currencies. There is no significant impact on profit or loss from foreign currency movements associated with the Parent company's assets and liabilities as the foreign currency gains or losses are recorded in the translation reserve.
Exchange rate fluctuations may adversely affect the Group's financial position and results. The following table details the Group's sensitivity to a 10% strengthening and weakening in the GB pound against the Canadian/US Dollar. 10% represents management's assessment of the reasonable possible exposure.
Equity
31 January 2012 31 July 2011
$,000 $,000
10% strengthening of GB pound 28 64
10% weakening of GB pound (26) (57)
10% strengthening of US dollar (2,174) (1,920)
10% weakening of US dollar 1.977 1,746
--------------------------------
--------------------------------
Liquidity risk
Prior to Q3 2010 the Group had relied on shareholder funding to finance its operations. During Q3, 2010 the Group entered into a financing arrangement in US dollars (gold loan) and a Credit Facility arrangement (see note 7). With finite cash resources and no material income, the liquidity risk is significant. This risk is managed by controls over expenditure and concentrating on achieving the payment milestones under the financing arrangement. Success will depend largely upon the outcome of ongoing and future exploration and development programmes. Given the nature of the Group's current activities the entity will remain dependent on a mixture of debt and equity funding in the short to medium term until such time as the Group becomes self-financing from the commercial production of mineral resources.
The Group's trade payables, other payables and accrued expenses are generally due between one and three months and the Group's financial liabilities are due as follows:
Financial liabilities 31 January 2012 31 July 2011
$,000 $,000
Due within one year 4,561 2,282
Due within one to two years 10,655 3,608
Due within two to three years 4,844 4,814
Due within three to four years 2,678 2,272
Due within four to five years 1,560 2,030
Due after five years 11,798 11,882
-----------------------------------
36,096 26,888
-----------------------------------
-----------------------------------
Fixed rate financial liabilities
At the period end the analysis of finance leases, hire purchase contracts and loans which were all due in Canadian Dollars and are at fixed interest rates was as follows:
Fixed rate liabilities 31 January 2012 31 July 2011
$,000 $,000
Due within one year 1,811 1,633
Due within one to two years 8,381 1,465
Due within two to three years 1,854 1,508
Due within three to four years 1,834 1,478
Due within four to five years 460 888
Due after five years 11 13
-----------------------------------
14,351 6,985
-----------------------------------
-----------------------------------
The average fixed interest rate for the finance leases and hire purchase contracts outstanding at 31 January 2012 was 5.90%.
Credit risk
The Group holds the majority of its cash resources in Canadian Dollars given that the majority of the Group's outgoings are denominated in this currency. Given the current climate, the Group has taken a very risk averse approach to management of cash resources and management and Directors monitor events and associated risks on a continuous basis. There is little perceived credit risk in respect of trade and other receivables. The Group and Company's maximum exposure to credit risk at January 31, 2012 was represented by receivables and cash resources.
Interest rate risk
The Group's policy is to retain its surplus funds on the most advantageous term of deposit available up to twelve month's maximum duration. Details of the Group's borrowings are described in note 7.If the interest rate on deposits were to fluctuate by 1% there would be no material effect on the Group's and Company's reported results.
Commodity price risk
Commodity price risk is the risk that the Group's future earnings will be adversely impacted by changes in the market prices of commodities. The Group is exposed to commodity price risk as its future revenues will be derived based on contracts with customers at prices that will be determined by reference to market prices of copper and gold at the delivery date.
The Group calculates the effective interest rate on the Gold Loan based on estimates of future cash flows arising from the sale of payable gold. In estimating the cash flows the following table details the Group's sensitivity to a 10% increase and a 25% decrease in the price of gold. These percentages represent management's assessment of the reasonable possible exposure.
Gross assets
31 January 31 July
2012 2011
$,000 $,000
10% increase in the price of gold 528 292
25% decrease in the price of gold (1,418) (783)
-------------------------------------
-------------------------------------
Financial assets
The floating rate financial assets comprise interest earning bank deposits at rates set by reference to the prevailing LIBOR or equivalent to the relevant country. Fixed rate financial assets are cash held on fixed term deposit.
At the period end the cash and short term deposits were as follows:
Average Average
period for interest
Floating which rates for
Fixed rate rate rates are fixed rate
At 31 January 2012 assets Assets Total fixed assets
$,000 $,000 $,000 Months %
GB Pounds 473 28 501 1 0.25
US $ - 62 62 - -
Canadian $ - 3,411 3,411 - -
------------------------------
473 3,501 3,974
------------------------------
------------------------------
At 31 July 2011
$,000 $,000 $,000 Months %
GB Pounds 667 47 714 1 0.25
Canadian $ 25 9,431 9,456 1.3 0.95
------------------------------
692 9,478 10,170
------------------------------
------------------------------
Fair values
In the directors' opinion there is no material difference between the book value and fair value of any of the group's financial instruments.
12. Subsequent Events
On February 8, 2012 the Group announced the purchase of Ming Mine's 2% net smelter royalty held by Philippine Metals Inc., formerly Meridian Mining Corporation, for CAD$600,000. Before the buyout the mine had a 4.5% combined net smelter royalty held by four separate groups. Arrangements are also being considered to buyout a further 1% net smelter royalty for CAD$500,000. Following the buyout of the 1% net smelter royalty the Ming Mine's net smelter royalty will be 1.5%.
On February 15, 2012 the Group completed an acquisition of 4,500,000 shares of Maritime Resources Corp (TSX VENTURE:MAE) ('Maritime') through a non-brokered private transaction priced at $0.23 per share for a total consideration of $1,035,000. The acquisition gives Rambler a 17% equity stake and an invite to appoint a representative to join Maritime's Board of Directors. Maritime continues to advance the Green Bay portfolio of properties, specifically the Hammerdown mine, and the Orion and Lochinvar deposits.
On March 6, 2012 Rambler announced that it had accepted an offer from Tinma International Ltd. ('Tinma'), a wholly-owned subsidiary of a China-based investor, to become a strategic shareholder in Rambler through a non-brokered private placement by entering into a conditional subscription agreement. Subsequently on March 19, 2012 Rambler announced the closing of the private placement resulting in the issuance of 10,403,980 ordinary shares to Tinma at a placing price of CAD $0.44 per ordinary share for gross proceeds of $4.58 million. Combined with current holdings this placement brings Tinma's total shareholdings in Rambler to 13,388,980 ordinary shares representing approximately 9.9 per cent of the issued share capital of Rambler, on a post-closing basis.
On March 15, 2012 the Group announced the completion of a preliminary economic assessment ('PEA') to include the Lower Footwall Zone mineralization in its mine plan. This assessment evaluated the potential for an expansion program at the Ming Mine to first optimize the current high grade operation followed by a transition into a 20+ year bulk tonnage operation through a four year ramp-up period increasing the current ore throughput of 630 mtpd to 3,500 mtpd. Numerous opportunities exist to improve the business case. It is these areas that future optimization and engineering studies will focus on to ensure that if or when the decision is made to proceed with the expansion, the project will benefit from the upside of the existing operation. PEA results include: pre-tax Net present value of US$251 million; internal rate of return of 18%, undiscounted pre-tax cash flow from operations of $861 million and initial capital requirements of US$231 million.
Neither TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Contacts:
Rambler Metals and Mining
George Ogilvie, P.Eng.
President and CEO
709-800-1929 or 709-800-1921
Rambler Metals & Mining Plc.
Corporate Office
+44 (0) 20 8652-2700
+44 (0) 20 8652-2719 (FAX)
www.ramblermines.com
Seymour Pierce Limited
Nandita Sahgal / Jeremy Stephenson
+44 (0) 20-7107-8000
Pelham Bell Pottinger
Charles Vivian / Philippe Polman
+44 (0) 20 7861 3921
Ocean Equities Limited
Guy Wilkes
+44 (0) 20-7786-4370
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