Half Yearly Report – Six Months Ended 31 Dec 2010
Greatland Gold plc (“Greatland” or the “Company”), the AIM-listed and London based gold exploration and development company focused on gold projects in Tasmania and Western Australia announces today its half-yearly report for the six months ended 31 December 2010.
Managing Director’s statement
In the six month period ending 31st December 2010 the Company reported a net loss of £152,110 equating to a loss per share of 0.09p (31st December 2009 EPS -0.16p). Part of Greatland’s total exploration costs were expensed through the profit and loss account whilst the balance of £135,015 in respect of Ernest Giles was capitalised and taken through the balance sheet.
Net cash outflow from operations was £411,634 which reflects total administrative expenses plus exploration expenses both capitalised and expensed. From the cash flow figures it is apparent that we have maintained our commitment to exploration and drilling. The Company’s administrative expenses declined to £94,941 over the period as the board once again exercised expense restraint. The Company’s cash deposits stood at £1.25m at the period end. In my view we are in a strong liquidity position ahead of our 2011 exploration plans.
Our loss on a per share basis at 0.09p reduced sharply from the loss of 0.16p in the comparable period reflecting lower expenses hence reduced losses, an increase in issued share capital, gains from available for sale financial investments, and currency gains. Our net loss of £152,110 is less than half last year’s interim loss of £328,609. The Company’s balance sheet ended the period with £2.16m of net assets against £1.982m at the 2009 interims.
Our team got underway at Ernest Giles last summer with the first drill results reported in August 2010. It is worth remembering the sheer scale of the Ernest Giles property post our licence extension at up to 948 km• and it is very encouraging to see proof of concept in the first drilling at Ernest Giles. We have drilled only four holes to date in a strike length of more than 100km and have intersected gold bearing alteration systems with analogies to major gold deposits elsewhere in Western Australia. Our program has confirmed that a new greenstone belt is present and that it has the potential for large-scale mineralisation. Ernest Giles contains over 100km of gold prospective greenstones. Results from the 2010 drill programme were considered by the board to have provided sufficient encouragement for further work at the project. The board feel it is important to undertake further drilling in the short term.
I am likewise optimistic over the recently acquired Bromus project also located in the Yilgarn which has excellent fundamentals in terms of access and ease of operations. Field activities are underway and we expect to make further announcements with respect to Bromus in the coming months.
No field work was carried out in Tasmania over the period, however, towards the end of 2010 we had completed government technical reporting and the planning of field and drilling activities for 2011. Our next programme of reverse circulation drilling will be at the Warrentinna licence (Derby North area) in Tasmania scheduled to commence in early April 2011. Previous reverse circulation drilling at Derby North by the Company returned results of 5m at 29.26g/t gold from 36m, including 1m at 103.07g/t gold. Also, drilling at the nearby East Lisle property is scheduled to commence during April 2011.
During the interim period we received third party inquiries relating to joint ventures covering our Tasmanian licence interests, which were pursued. In recent months further enquiries have been forthcoming for both our Tasmanian and Western Australian licences. Negotiations are continuing with several parties. We continue to believe that the Greatland asset portfolio holds significant attractions for investors whether it be via a joint venture or otherwise, and we remain keen to find a deal that will be positive for our shareholders.
The overall environment for gold investment is possibly the strongest it has ever been. Recent moves in the gold price above US$1,400 per ounce suggests a permanent shift in investment and retail demand for gold. This may prompt M&A activity and/or joint venture deals amongst our peer group companies.
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