30 November 2012
Conroy Gold and Natural Resources plc
("Conroy" or "the Company")
Final Results For The Year Ended 31 May 2012
Further work on pre-feasibility study completed
Conroy (AIM: CGNR; ESM: CGNRI), the Irish based resource company
exploring and developing gold and other projects in Ireland, is pleased to announce its results
for the year ended 31 May 2012.
Highlights:
* Conroy now has under licence the entire 30 mile gold trend which it has
discovered in the Longford-Down Massif in Ireland.
* A series of significant gold targets have been discovered along the trend
* Updated Clontibret resource evaluation - 600,000 oz indicated and inferred
* Economic evaluation based on 20 per cent. of Clontibret - payback period of
two years
* Agreement with Gold Fields Limited to undertake mineralogical
characterisation and prefeasibility metallurgical test work
* Proposed process - BIOX®; a well-established bacterial oxidation process.
Gold Fields Limited is a world leader in this environmentally friendly,
proven technology
* In-house studies, though conceptual in nature, suggest that the total gold
potential in the Longford-Down Massif could lie in the 15 million - 20
million ounce range.
Chairman, Professor Richard
Conroy commented:
"We continue working on the pre-feasibility study at Clontibret
where we have an economic mine project whilst also continuing to
assess additional targets along the 30 mile gold trend discovered
by and which Conroy now has under licence.
"We have continued the infill drilling at Clontibret to further
expand the identified resource whilst also continuing the drill
programme at the targets which are potentially significantly
larger.
"We have established that a gold mine is viable and we are now
working towards bringing it into production."
Further Information:
Conroy Gold and Natural Resources plc Tel: +353-1-661-8958
Professor Richard Conroy, Chairman
Merchant Securities Limited (Nomad) Tel: +44-20-7628-2200
Simon Clements/Virginia Bull
Hybridan LLP (Joint Broker) Tel: +44-20-7947-4350
Claire Noyce/Deepak Reddy
Shore Capital Stockbrokers Limited (Joint Broker) Tel:
+44-20-7408-4050 Jerry Keen/Bidhi
Bhoma/Toby Gibbs
IBI Corporate Finance Limited (ESM Adviser) Tel: +353-766-234-800
Brian Farrell
Lothbury Financial Services Limited Tel: +44-20-3440-7620
Michael Padley/Michael Spriggs
Hall Communications Tel: +353-1-660-9377
Don Hall
www.conroygoldandnaturalresources.com
CHAIRMAN'S STATEMENT
I have pleasure in presenting your Company's Annual Report and
Financial Statements for the 12 months ended 31 May 2012, a very successful year during which
the positive results on both financial and technical grounds from
the independent scoping study (the "Study") completed by Tetra Tech
WEI Inc. ("Tetra Tech") to Joint Ore Reserves Committee ("JORC")
standard indicated the viability of your Company's proposed gold
mine in Clontibret, Co.
Monaghan.
Your Company now has under licence the entire 30 mile gold trend
which it has discovered in the Longford-Down Massif in Ireland. A series of significant gold targets
have been discovered by your Company along this 30 mile trend
ranging from the Clay Lake Gold target in Co. Armagh in Northern Ireland to the Clontibret and Glenish
targets in Co. Monaghan and Slieve
Glah targets in Co. Cavan in the
Republic of Ireland.
Clontibret Gold Project
The updated resource evaluation (the "Evaluation") prepared by
Tetra Tech on the 20 per cent. portion of the Clontibret gold
target was published in December
2011. The Evaluation was based on a long-term gold price of
US$1,372 per oz gold, used a minimum
mining width of 2 metres, a cut-off grade of 0.60g/ t gold and
concentrated on the high grade portions of the stockwork zones.
This gave a tonnage of 11,709,700 tonnes and over 600,000 oz at
1.60 g/t gold (Indicated 259,956 oz gold, Inferred 341,148 oz
gold). The mineral resource was evaluated for mining potential
using Whittle pit optimisation software.
The Whittle evaluation showed within a conventional open pit
configuration, a stripping ratio of 9.4, a production rate of
800,000 tonnes per annum, a gold head grade of 1.53g/t gold, an
assumed overall recovery rate of approximately 85 per cent. using a
bio-oxidation process; in-situ gold averaging over 50,000 oz per
annum in the first five years of mine life and a mine life of 11.2
years with capital costs of US$77.8
million and a payback period of two years.
The economic evaluation was based on a pre-tax financial model,
taking a base case commodity price for gold of US$1,372 per ounce, giving an IRR of 49.4 per
cent. and a NPV, at an 8 per cent. discount rate, of US$72.3 million.
In March 2012, your Company
announced further results from its infill drilling programme. This
phase of the infill drilling programme concentrated on further
defining the resource area within the pit area as proposed in the
Study. The results confirmed good continuity with the known
mineralisation in the area. These drill holes and the previous
infill drill holes also provided geotechnical information for mine
design purposes together with ore material for metallurgical
testwork. Your Company announced subsequently that it had signed an
agreement with Gold Fields Limited to undertake mineralogical
characterisation and metallurgical test work on drill core samples
provided from its Clontibret gold project. The samples total over
350kgs of drill core and have been dispatched to South Africa for testing. The samples are
comprised of ore grade material with a 10 per cent. dilution factor
and represent a similar grade to that expected for run of mine.
The prefeasibility metallurgical testwork will comprise
Comminution, Flotation and BIOX® Testwork. The testwork will be
managed and executed by SGS South Africa (Pty) Limited under the
supervision and direction of Gold Fields Limited. BIOX® is a well
established bacterial oxidation process and Gold Fields Limited is
a world leader in this environmentally friendly, proven technology
with a number of plants currently in operation worldwide, including
South Africa, Ghana, Brazil, China
and Australia. Tetra Tech who
carried out the scoping studies at Clontibret has been appointed to
review the metallurgical studies on behalf of your Company and
compile the metallurgical report for the feasibility studies.
Clay Lake Gold Target
The Clay Lake gold target is a very large gold target extending
for 2 km by 1 km, (c.140 ha / 350 acres) 4.5 miles to the
North-East of the Clontibret gold target. The anomaly is named
after the Clay Lake Nugget; a 30.05g nugget with a gold content of
28g found in the 1980's which is now in the Ulster Museum.
Gold-in-soil values averaging over 50 ppb, with the highest
gold-in-soil value seen to date in the Company's licence area of
1,531 ppb gold (1.53g/t gold) were recorded in the soil samples
collected over the target area. The surface area of the discovery
is greater than that of Clontibret (c.125 ha / 310 acres) and the
gold-in soil concentrations are double the average of those
recorded at Clontibret.
Rock chip samples identified gold in bedrock which comes to the
surface in the Northern part of the Clay Lake target in the form of
a black carbonaceous stockwork. The rock chip samples in the
exposed rock returned 18 metres at 0.47 g/t gold and included 3
metres at 1.30 g/t gold before the exposure ceased.
A drilling programme, in the North-Western corner of the Clay
Lake target, returned positive results identifying a 450 metre open
ended zone of black carbonaceous stockwork with the second drill
hole intersecting 63 metres at 0.62 g/t gold including 9 metres at
1.48 g/t gold. Some other highlights from this drilling included 11
metres at 1.44g/t gold, 53 metres of stockwork at 0.60g/t gold
including 10.25 metres at 1.37g/t gold and 8 metres at 0.93g/t gold
including 3 metres at 2.13g/t gold.
A ground geophysical survey at Clay Lake has now been conducted
by Golder Associates, totalling 960 line metres in four survey
lines over the Northern area of the target. The survey was
performed to determine the geophysical signature of the
mineralisation and hosting lithologies, together with geological
information on the subsurface features.
Strong features were seen in all four lines and interpretation
of the results depicted an anticlinal folding sequence of the gold
bearing black carbonaceous stockwork zone, which had been seen in
the drill holes previously.
These geophysical results, combined with the drilling results,
provide excellent information for future drilling in particular
regarding the apexes of the anticlinal structures as mineralisation
tends to accumulate in such structures and supports the view that
the Clay Lake gold target could host a large gold deposit.
Slieve Glah Gold Target
Slieve Glah is approximately 40km South-West of Clontibret.
Following a detailed gold-in-soil survey this month, your Company
announced the discovery of a series of further large gold-in-soil
targets within its Slieve Glah licence areas in County Cavan. Two new targets (Targets 3 and
4) each over 3 km (1.9 miles) in length were discovered. In
addition the assay results of the survey, which comprised over 900
soil samples, extended the surface area of the two known gold
targets (Targets 1 and 2) at Slieve Glah by over 1 km (0.6 miles),
both now also totalling over 3 km (1.9 miles) in length. Anomalous
gold values returned from the assay analysis ranged from 4 ppb gold
to over 300ppb gold. In Ireland,
over 10ppb gold is considered highly anomalous in soil samples and
during follow-up drilling and/or trenching over such anomalies
typically proves positive for gold-in bedrock.
In one of the newly discovered targets at Slieve Glah (Target 4)
a highly anomalous area has been identified which measures
approximately 1,000 metres in length by 500 metres in width,
trending Northwest to Southeast. The area has been defined by over
a hundred soil samples collected on an approximately 100 metre
grid. Assay analysis returned maximum gold values of up to 140ppb
gold with over 30 per cent. of the soil samples returning elevated
gold values of greater than 10ppb gold. Gold had previously been
confirmed by your Company in bedrock in the Slieve Glah target area
through trenching and drilling.
The gold in soil targets identified by the soil sampling survey
appear to be structurally controlled and occur as a series of right
angle zones adjacent to the Orlock Bridge Fault, a major sinistral
fault believed to be an influencing factor on mineralisation in the
region. In the Slieve Glah area the Orlock Bridge Fault undergoes a
marked swing from its normal Northeast - Southwest strike,
producing a dilatational zone allowing greater permeation and
circulation of mineralising fluids, which also may assist in
concentration of mineralisation and thus can be associated with
substantial accumulations of minerals.
Total Gold Potential
The in-house studies by your Company, though conceptual in
nature, suggest that the total gold potential of the Company's
exploration licences in the Longford-Down Massif could lie in the
15 million - 20 million ounce range. This projection is based on
the 1 million ounce JORC-compliant resource outlined in only 20 per
cent. of the Clontibret project, the potential of the remaining 80
per cent. of that target, the discovery at Clay Lake and other
large gold-in-soil anomalies that have been outlined elsewhere on
its licences. Whilst there has been insufficient exploration to
date to define such a mineral resource, and there is no certainty
that further exploration will result in a resource of this
magnitude being realised, your directors believe that the potential
of the area is clear and the possibilities exciting.
Mining in Ireland
Ireland is currently a major
base metal producer. There is a long established mining tradition,
a favourable business climate and excellent infrastructure. The
Conroy executive team who were involved in the discovery and
development of the Galmoy zinc ore bodies which led to the revival
of the Irish base metal industry now look forward to the
development of a gold mine at Clontibret and of a possible multi
deposit gold strategy in the Longford-Down Massif.
Share Price
Your Board believes that your Company's value, as measured by
the share price, is yet to reflect the increasing value of its
underlying assets as it moves towards development and
production.
Finance
The loss after taxation for the year ended 31 May 2012 was €533,262 (2011: € 427,970) and
the net assets as at 31 May 2012 were
€12,678,448 (2011: €11,647,817).
During the year £1,230,417 (prior to expenses) was raised by the
issue of 39,944,055 shares for cash and I personally subscribed for
13,896,552 of those. Details of the share issues are in Note 13 to
the accounts.
As in previous years, I have supported the working capital
requirements of the Company. The balance of the loans due to me at
the period end was €665,318. The loans have been made on normal
commercial terms. The other directors consider, having consulted
with the Company's Nominated Adviser and the Company's ESM Adviser,
that the terms of the loans are fair and reasonable in so far as
the Company's shareholders are concerned.
Auditors
I would like to take this opportunity to thank the partners and
staff of Deloitte & Touche for their services to your Company
during the course of the year.
Directors
I would also like to express my deep appreciation of the support
and dedication of the directors, consultants and staff, which has
made possible the continued progress and success, which your
Company has achieved.
Future Outlook
Your Company has made further excellent progress in the
financial year to the 31 May 2012. I
look forward to the future with confidence as we move from the
exploration phase into the development phase.
Professor Richard Conroy
Chairman
30 November 2012
INCOME STATEMENT
FOR YEAR ENDED 31 MAY 2012
2012 2011
€ €
OPERATING EXPENSES (524,888) (419,858)
Finance income - bank interest 779 5,764
receivable
Finance costs - interest on (9,153) (13,876)
shareholder loan
LOSS BEFORE TAXATION (533,262) (427,970)
Taxation - -
LOSS FOR THE YEAR (533,262) (427,970)
Loss per ordinary share - basic and (€0.0022) (€0.0020)
diluted
STATEMENT OF FINANCIAL POSITION
AS AT 31 MAY 2012
2012 2011
ASSETS € €
Non-current Assets
Intangible assets 13,603,186 11,759,028
Investment in Subsidiary 2 2
Property, plant and equipment 10,688 23,849
13,613,876 11,782,879
Current Assets
Trade and other receivables 73,940 81,323
Cash and cash equivalents 238,647 749,459
312,587 830,782
Total Assets 13,926,463 12,613,661
EQUITY AND LIABILITIES
Capital and Reserves
Called up share capital 8,112,257 6,913,935
Share premium 7,872,573 7,656,028
Capital conversion reserve fund 30,617 30,617
Share based payments reserve 880,709 731,682
Retained losses (4,217,708) (3,684,445)
Total Equity 12,678,448 11,647,817
Non-current Liabilities
Financial Liabilities 665,318 646,673
Total Non-current Liabilities 665,318 646,673
Current Liabilities
Trade and other payables 582,697 319,171
Total Current Liabilities 582,697 319,171
Total Liabilities 1,248,015 965,844
Total Equity and Liabilities 13,926,463 12,613,661
CASH FLOW STATEMENT
FOR THE YEAR ENDED 31 MAY 2012
2012 2011
€ €
Cash flows from operating activities
Cash used in operations (211,386) (623,060)
Tax paid - -
Net cash used in operating activities (211,386) (623,060)
Cash flows from investing activities
Investment in exploration and evaluation (1,687,013) (1,780,526)
Payments to acquire property, plant and (938) (24,158)
equipment
Net cash used in investing activities (1,687,951) (1,804,684)
Cash flows from financing activities
Issue of share capital 1,414,867 1,895,105
Repayment of shareholder loan - (42,424)
Bank interest received 779 5,764
Interest paid on shareholder loan (27,121) (329,402)
Net cash generated from financing 1,388,525 1,529,043
activities
Decrease cash and cash equivalents (510,812) (898,701)
Cash and cash equivalents at beginning of 749,459 1,648,160
year
Cash and cash equivalents at end of year 238,647 749,459
Notes to the Financial Statements
1. Publication of non-statutory accounts
The financial information set out in this preliminary
announcement are abbreviated accounts as defined in Section 19 of
the Companies (Amendment) Act 1986.
The financial information for the period ended 31 May 2012 has been extracted from the Company's
financial statements to that date which have received an
unqualified auditor's report but have not yet been delivered to the
Registrar of Companies.
2. Earnings per share
The calculation of the loss per ordinary share of €0.0022 (2011
- €0.0020) is based on the loss for the financial year of €533,262
(2011 - €427,970) and the weighted average number of ordinary
shares in issue during the year of 245,158,271 (2011 -
213,797,820).
Since the Company incurred a loss the effect of share options
and warrants would be anti-dilutive.
3. Dividends
No dividends were paid or are proposed in respect of the period
ended 31 May, 2012.
4. Copies of Accounts
A copy of the Annual Report and Financial Statements will be
available on the Company's website
www.conroygoldandnaturalresources.com and will be available from
the Company's registered office, 10 Upper Pembroke Street,
Dublin 2. It will also be
forwarded to shareholders who requested a hard copy. Notice of the
Annual General Meeting to be held on 13
December 2012 and Proxy Form was sent to shareholders on
21 November 2012 and are also
available on the website.