Mwana Africa PLC ("Mwana", the "Group" or the "Company") is pleased to announce its unaudited interim financial results for the six months to 30 September 2009.
The past six months have seen notable achievements at each of the Company's principal assets.
Most significant of these was the resumption of production from the Freda Rebecca gold mine in Zimbabwe, in line with the timescale envisaged when the board decided to implement the restart, and coincident with a period of historically high gold prices. Production at the mine is continuing to ramp up successfully towards the planned rate of 30,000 ounces of gold per year. The provision of project finance by the IDC will enable the Company to accelerate implementation of the second phase of the refurbishment programme. Drawdown of the loan remains subject to legal documentation, and to fulfilment of certain conditions precedent, which the board expects will be satisfied in the first quarter of 2010.
Resource modelling at Zani Kodo, based on drilling along 700 metres of a strike which has been defined over nine kilometres, has demonstrated the potential of this project. The recently completed acquisition of Moto Goldmines by Randgold and by Anglogold demonstrates that Mwana is not alone in its belief in the potential of this area.
At BNC, the care and maintenance programme, begun approximately twelve months ago, continues to preserve the integrity of this substantial asset. During the period, a number of potential restart scenarios have been considered, and a decision has been taken to resume production from the Trojan mine and concentrator, subject to the availability of finance. Independent technical consultants have been appointed to review this scenario, and discussions with potential financiers have commenced.
Just as the Company has looked after its physical assets, so it has sought to preserve its cash position. During the period, Mwana completed the first stage of refurbishment of Freda Rebecca and continued to make progress at its portfolio of exploration prospects without recourse to external finance. BNC has funded the costs of its care and maintenance programme from its own resources.
Over the last six months, throughout the organisation, Mwana has looked for ways to improve the efficiency and quality of its projects. The board continues to be encouraged by developments in Zimbabwe, and notes the part that the resumption of production from Freda Rebecca is playing, and the role that BNC will play, in the rebuilding of that country.
The board remains cautiously optimistic on the prospects for commodity prices in the markets in which Mwana operates. The gold price continues to set new records as individuals and organisations around the world search for a store of value in the face of US dollar weakness and likely global inflation. Meanwhile the board believes that the price of nickel, which began to recover in the first half of the calendar year, has stabilised at a level at which BNC, and others in the nickel industry, can operate sustainably.
The prospects for commodity prices, for Zimbabwe and the specific prospects for Mwana have improved over the period. Mwana's board and management remain focussed on turning the Company's flagship projects to account.
Oliver Baring, Executive Chairman
Tel: 020 7654 5588
Donald McAlister, Finance Director
Tel: 020 7654 5588
Ryan Gaffney / Mike Jones
Tel: 020 7050 6500
Tom Randell / Anca Spiridon
Tel: 020 7653 6620
| Share code: | MWA |
| Market: | AIM |
| Listing date: | 26 Oct 2005 |
| Index: | FTSE AIM All-Share Index |
| Sector: | Basic Resources; |
| Sub‑sector: | Gold Mining |
| Country of register: | Great Britain |
| Segment: | AMSM |