Cambridge Mineral - Interim Results
CAMBRIDGE MINERAL RESOURCES plc
INTERIM RESULTS
Further progress
Cambridge Mineral Resources plc ('CMR' or 'the Company'), the mining and ex ploration company, announces its
results for the 6 months ended 30 June 2007. The period has been one of fu rther progress.
Highlights:
- Completion of Feasibility Study on Quintana Gold Mine in Colombia,
- operational mine expected in six months, subject to available finance
- forecast annual production 15,500 oz gold
- JORC compliant resource base 109,852t grading 24.58g/t gold
- El Cinco gold mine drill programme commenced, to prove minimum 300,000t r esource. Average grade of all vein
samples to date is 14.24 g/t gold
- Positive initial results from the Mina La Linda and Mina del Sol gold pro spects in Colombia
- Further strategic acquisitions in Colombia completed
- Development of the Rasuhuilca silver mine in Peru on schedule
- Uranium assets in Bulgaria added to portfolio
- Asset base increased; loss reduced
Colin Andrew, Managing Director, Cambridge Mineral Resources plc, commented :
'The Company's progress towards near-term precious-metal production is on t rack following the successful
completion of our feasibility study at Quintana, Colombia, and the advanced development of our Rasuhuilca silver
mine in Peru where a feasibility study has commenced. Naturally, progressi on to production at these and other
mines in our portfolio will be subject to raising the appropriate debt or e quity finance.
'Exploration has also progressed in the Balkans where we have added a signi ficant uranium deposit to our
portfolio, and recent increases in metal prices have encouraged us to comme nce a re-assessment of our Lomero-
Poyatos project in Spain.
'We are very pleased with the progress made overall, in particular in Colom bia where we expect to be in production
early next year.'
Colin J. Andrew BSc ARSM MIMMM FGS CEng, Managing Director of Cambridge Min eral Resources plc, and a Qualified
Person as defined by the 'Guidance Note for Mining, Oil and Gas Companies, March 2006' of the London Stock
Exchange, has reviewed the information contained herein.
27 September 2007
ENQUIRIES:
Cambridge Mineral Resources plc Tel: +44 (0) 20 7663 5618
Colin Andrew, Managing Director
Ruegg & Co Limited Tel: +44 (0) 20 7584 3663
Gavin Burnell / Brett Miller
Bankside Consultants Tel: +44 (0) 20 7367 8888
Michael Padley / Michael Spriggs
Website: www.cambmin.co.uk
About Cambridge:
Cambridge Mineral Resources plc is an AIM-quoted mining and exploration com pany.
Its principal focus is the exploration for and production of precious metal s, base metals and uranium in the
following key target areas:
- South America: Colombia and Peru
- Europe: Spain, Bulgaria and Serbia
The Company has a strong portfolio of mineral projects at varying stages of development and commercialisation,
supporting its strategy of providing shareholders with attractive upside op portunities.
CHAIRMAN'S STATEMENT
--------------------
I am very pleased to report on your Company's progress during the first hal f of 2007, a period of considerable
achievement. Cambridge Mineral Resources (CMR) enlarged both its asset bas e and resources, in the period, through
its exploration activities in Colombia and Peru and further strategic acqui sitions in Colombia. The loss for the
period was �603,735, down from �682,270 for the same period in 2006 as a result of tight cost control and a
reduction in administrative expenses. To support the continuing progress t oward production in Colombia, the
Company raised �0.25m during the period, which was received in July. Fina ncing for the first gold mine by project
debt and equity is currently being sought.
OPERATIONS
COLOMBIA
CMR's ongoing strategy is to build a portfolio of small, high-grade gold mi nes that can be developed and expanded
by using modern methodologies and equipment in order to significantly incre ase production. The Company currently
holds a number of such mines under option where exploration and development work has progressed satisfactorily
during the period. In particular, following the recent completion of an Ec onomic Feasibility Study at the
Quintana gold mine, the Company has decided to proceed with the development of the mine and the construction of a
processing plant. Capital costs for Quintana are estimated to be US$4.5 mi llion, for which finance is currently
being sought. The Feasibility Study demonstrated a JORC compliant indicate d and inferred resource base totaling
109,852t ore grading 24.58g/t gold and proposed a 50t/d mining operation wi th a US$10.8m NPV (10% discount rate)
over the current 5.5 year life of mine at a base gold price of US$600/Toz. Subject to the availability of project
finance the mine is expected to be operational within approximately six mon ths with the annual production expected
to reach 15,500 ozs of gold within 36 months of start-up. Progress has als o been made at El Cinco, La Linda, La
Roselada and Mina del Sol, where the Company completed an initial 5 hole dr illing programme, which gave excellent
results in the opinion of the Directors, including 90.0m @ 1.46 g/t gold.
PERU
The Company has now completed 142.1m of vertical development and 92.0m of h orizontal development at its Rasuhuilca
silver mine, which has resulted in an initial independent resource estimate by Peruvian Consulting Engineer, Mr.
Renan Castillo Neyra, of 98,200 tonnes at 4.78 g/t gold and 160 g/t silver. Following preliminary scoping
testwork conducted by Wardell Armstrong International, UK, and others, the feasibility study will consider
installing a plant for the mineral treatment by flotation and vat cyanide l eaching. The processing plant will
have a capacity of 3,000 tonnes per month. Precious metal recoveries are i ndicated to be approximately 90% for
gold and 70% for silver. The preliminary operating costs have been estimat ed at between US$60 and 65 per tonne
mined and milled. Capital costs will be estimated as part of the feasibili ty study.
SPAIN
During the period a full review of the economics of Lomero-Poyatos was comm enced in the light of greatly enhanced
metal prices. The outcome of this review will be announced when completed.
BALKANS
In Bulgaria CMR re-acquired a 100% interest in its various gold exploration permits following the completion of
its joint venture with Asia Gold Corporation. The Company has since receiv ed expressions of interest from other
potential joint venture partners and expects to be able to provide more inf ormation to shareholders on these
discussions shortly.
In addition, the Company announced that it has commenced evaluating a numbe r of uranium deposits located in
Bulgaria. These deposits are located on permits already held and permits u nder application. CMR's existing
Dobroselets deposit is estimated to contain approximately 1.5 million lbs o f uranium.
In Serbia exploration with our joint venture partner, Dundee Precious Metal s, continues to advance the
gold/silver/copper projects.
CORPORATE
CMR raised �0.25m from a placing of shares (with attached warrants) durin g June and July. These funds will be
used to further develop our Colombian projects with the aim of bringing the m into production.
The Company will however need to raise further funding in the short term to ensure that it has the financial
resources needed to complete its development programme in Colombia and to f inance its other exploration and
development plans. CMR is reviewing a number of options for securing new f unding, including the possibility of
raising project finance, new equity or funding from joint venture partners.
Prudent and cost-effective use of shareholders' funds is of the utmost prio rity to your Board. Strict budgeting
and cost management is employed to minimise costs and expenses continuously .. The loss for the period was
�603,735, down from �682,270 for the same period in 2006, a reduction o f �78,535 (12%), reflecting our continuing
drive to spend less money on administration and more money on projects. Th is was achieved notwithstanding the
continuing growth and diversification of the Group's assets and operations over this period.
SUMMARY
Good progress has been achieved in establishing a sound business platform f or the future and we expect to maintain
that progress and pace during the rest of the year. In 2005 CMR embarked u pon an exciting transition from
exploration to production, and we are meeting the milestones set at that ti me. Your Board is fully committed to
its mission to deliver shareholder returns and, subject to raising sufficie nt funding, we expect to continue to
advance towards that goal during the second half of 2007 and beyond.
Neil Maclachlan
Non Executive Chairman
26 September 2007
Condensed Interim Statements for 6 months ending 30 June 2007
Unaudited consolidated interim income statement
6 months to 6 months to Year to
30 June 2007 30 June 2006 31 December 2006
� � �
Continuing operations
Other income 4,238 16,625 27,193
Administrative costs (588,773) (690,625) (874,834)
Loss on disposal of quoted
investments (19,200) - -
Share of loss from joint
ventures - (8,270) (635)
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Loss before tax (603,735) (682,270) (848,276)
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Earnings per share:
Basic loss per share (0.29p) (0.47p) (0.54p)
-----------------------------------------------
-----------------------------------------------
Diluted loss per share (0.25p) (0.38p) (0.46p)
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Unaudited consolidated interim statement of recognised income and expense
6 months to 6 months to Year to
30 June 2007 30 June 2006 31 December 2006
� � �
Exchange differences on
translation of foreign
operations 19,524 403 (64,345)
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Net income recognised
directly in equity 19,524 403 (64,345)
Loss for the period (603,735) (682,270) (848,276)
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Total recognised income and
expense for the period (584,211) (681,867) (912,621)
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Unaudited consolidated interim balance sheet
30-Jun-07 30-Jun-06 31-Dec-06
� � �
ASSETS
Non-current assets
Development expenditure 7,367,278 5,494,040 6,751,508
Property, plant and equipment 99,780 80,956 118,642
Goodwill 1,115,241 1,115,241 1,115,241
Investments in joint ventures 934,025 828,884 866,180
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9,516,324 7,519,121 8,851,571
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Current assets
Cash and cash equivalents 36,481 270,036 626,573
Trade and other receivables 512,919 560,478 806,169
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549,400 830,514 1,432,742
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Total assets 10,065,724 8,349,635 10,284,313
---------------------------------------
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LIABILITIES
Current liabilities
Trade and other payables (731,404) (360,489) (412,163)
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Total liabilities (731,404) (360,489) (412,163)
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Net assets / liabilities 9,334,320 7,989,146 9,872,150
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EQUITY
Equity attributable to equity
holders of the parent
Share capital 2,173,322 1,451,322 2,089,989
Share premium account 10,623,474 9,165,330 10,456,807
Revaluation reserve 45,300 18,900 48,500
Merger reserve 2,116,435 2,116,435 2,116,435
Profit and loss account (5,624,211) (4,762,841) (4,839,581)
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Total equity 9,334,320 7,989,146 9,872,150
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---------------------------------------
Unaudited consolidated interim cashflow statement
6 months to 6 months to Year to
30 June 2007 30 June 2006 31 December 2006
Restated Restated
� � �
Cash flows from operating
activities
Loss before tax (603,735) (682,270) (848,276)
Adjustments for:
----------------
Decrease/(increase) in
other receivables and
prepayments 290,399 90,282 (158,967)
Increase/(decrease)
in trade and other
payables 319,219 44,368 96,806
Depreciation (7,004) 11,302 21,889
Loss/(gain) foreign
exchange 13,427 (19,648) 892
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Net cash inflow/(outflow)
from operating activities 12,306 (555,966) (887,656)
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Cash flows from investing
activities
Development expenditure (818,197) (484,116) (1,653,962)
Purchase of property,
plant and equipment 29,406 (21,173) (74,752)
Interest received 4,238 16,625 26,558
(Decrease)/ increase
in investments (48,645) 8,331 (28,965)
(Loss)/ gain on disposal
of investments (19,200) - -
------------------------------------------------
Net cash used in
investing activities (852,398) (480,333) (1,731,121)
------------------------------------------------
Cash flows from financing
activities
Proceeds from issue of
share capital 250,000 - 1,997,750
Expense of share issues - - (67,606)
------------------------------------------------
Net cash from financing
activities 250,000 - 1,930,144
------------------------------------------------
Net increase in cash and
cash equivalents (590,092) (1,036,299) (688,633)
Cash and cash equivalents
at beginning of period 626,573 1,306,335 1,315,206
------------------------------------------------
Cash and cash equivalents
at end of period 36,481 270,036 626,573
------------------------------------------------
------------------------------------------------
Notes
1 The financial information set out in this interim report does not constit ute statutory accounts as defined in
Section 240 of the Companies Act 1985. The Group's statutory financial sta tements for the year ended 31 December
2006, prepared under UK GAAP, have been filed with the Registrar of Compani es. The auditor's report on those
financial statements was unqualified and did not contain a statement under Section 237(2) of the Companies Act
1985.
2 No dividends were paid or proposed in respect of the six months ended 30 June 2007.
3 This condensed consolidated interim report has been prepared in accordanc e with the accounting policies set out
below, which are based on the recognition and measurement principles of IFR S in issue as adopted by the European
Union (EU) and are effective at 31 December 2007 or are expected to be adop ted and effective at 31 December 2007,
our first annual reporting date at which we are required to use IFRS acco unting standards adopted by the EU.
The Group's consolidated financial statements were prepared in accordance w ith United Kingdom Accounting Standards
(United Kingdom Generally Accepted Accounting Practice) until 31 December 2 006. The date of transition to IFRS
was 1 January 2006. The comparative figures in respect of 2006 have been r estated to reflect changes in
accounting policies as a result of adoption of IFRS. The disclosures requi red by IFRS 1 concerning the transition
from UK GAAP to IFRS are given in the reconciliation schedules, presented a nd explained in note 4.
The accounting policies have been applied consistently throughout the Group for the purposes of preparation of
this condensed consolidated interim report.
4. As a result of the Company's transition to IFRS, the treatment of Goodwi ll amortisation has changed as shown in
the following table.
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As at As at As at
Reconciliation of equity 01 Jan 2006 30 Jun 2006 31 Dec 2006
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Note � � �
---------------------------------------------------------------------------
GAAP 6,848,322 6,150,147 7,869,621
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Adjustments (after taxation)
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IFRS3 - 'Business
combinations' Goodwill a 38,237 76,474
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Hereward Ventures
Bulgaria EAD Net Assets b 1,458,061 1,440,623 1,420,069
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ASG Cambridge Bulgaria
EAD Net Assets b 244,331 360,139 505,986
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------------------------------------------
Net assets and equity
under IFRS 8,550,714 7,989,146 9,872,150
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------------------------------------------
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6 months ended 6 months ended 12 months ended
Reconciliation of profit 30 Jun 2007 30 Jun 2006 31 Dec 2006
---------------------------------------------------------------------------
Note � � �
---------------------------------------------------------------------------
Net income under UK
GAAP (603,735) (698,517) (874,100)
---------------------------------------------------------------------------
Adjustments (before
taxation)
---------------------------------------------------------------------------
IFRS3 - 'Business
combinations' a 38,237 76,474
---------------------------------------------------------------------------
Hereward Ventures
Bulgaria EAD profit
for the period b 37,094 80,556
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ASG Cambridge
Bulgaria EAD (loss)
for the period b (59,084) (131,206)
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----------------------------------------------
Net income under IFRS (603,735) (682,270) (848,276)
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Notes to the reconciliations
a. Under IAS 38, goodwill is not amortised, but tested annually for impairm ent. The goodwill amortisation charge
recognised in accordance with UK GAAP in 2006 was written back. The result of this adjustment is to decrease the
amortisation charge in the income statement for the six months ending 30 Ju ne 2006 by �38,237 and for the year
ending 31 December 2006 by �76,474.
b. During the period the Company's subsidiaries, Hereward Ventures Bulgaria EAD and ASG Cambridge Bulgaria EAD,
completed their joint venture agreements with Asia Gold Corp, as a result o f which the subsidiaries ceased to be
accounted for as investments and were treated as full subsidiaries for cons olidation purposes. The assets and
liabilities of the subsidiaries have been fully consolidated as from 31st D ecember 2005 and therefore the
previously reported group accounts have changed accordingly.
5 Business Combinations
The Group has taken advantage of the business combinations exemption which allows the Group not to restate
business combinations prior to January 2006. Instead, the existing goodwil l has been frozen at that date, tested
for impairment and not subsequently amortised.
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Cambridge Mineral Resources Plc
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