INTERIM RESULTS FOR THE 6 MONTHS TO 30 JUNE 2011

SERABI MINING plc

("Serabi" or "the Company")

 

 

 

Interim Results for the 6 months to 30 June 2011

Financial Results for Second quarter 2011 and Management Discussion and Analysis

 

 

Serabi Mining plc (AIM:SRB, TSX:SBI and SBI.WT), the Brazilian focused gold exploration company, advises that it has today published its unaudited financial results for the 3 month and 6 month periods ending 30 June 2011 and at the same time has also published its Managements Discussion and Analysis for the same periods.

 Both documents, together with this announcement, have been posted on the Companys website at www.serabimining.com and are also available on SEDAR at www.sedar.com.

 The full text of both the financial results and Managements Discussion and Analysis are also available by following the links contained in this press release.

 

 

Financial Highlights

 

	3 months ended  30 June 2011 (unaudited)	3 months ended  30 June 2010 (unaudited)	6 months ended  30 June 2011 (unaudited)	6 months ended  30 June 2010 (unaudited)
	US$	US$	US$	US$
Operating Loss for period	(1,562,635)	(1,634,584)	(2,305,277)	(2,588,183)
Loss per ordinary share (basic and diluted)	(2.44) cents	(4.70) cents	(4.22) cents	(7.66) cents
Exploration expenditures during the period	2,590,150	494,545	4,229,417	799,564
Cash at end of period	7,859,831	7,272,296	7,859,831	7,272,296
Equity Shareholders funds at end of period	54,450,877	44,828,060	54,450,877	44,828,060

 

 

For the three month period ended 30 June 2011 the Company recorded a net loss of US$1,562,635 (2.44 US cents per share) compared to a net loss of US$1,634,584 (4.70 US cents per share) for the comparative period last year.

 The decrease in the loss of US$71,949 reflects a reduction in the gross loss for the period of US$293,000 and a reduced loss on foreign exchange of US$44,988 compared with a loss in the corresponding period of US$271,000.

These improvements have been offset by a US$267,000 increase in administration costs.

A charge of US$100,000 has taken in the period to increase the provision for the rehabilitation of the Palito mine site upon eventual abandonment.

This charge which results from changes in exchange rates and discount rates used to estimate the provision required has been recorded as a foreign exchange cost of US$70,500 and a finance cost of US$29,500.

 

In the three months ended 30 June 2010, the Company had limited gold production from open pit mining operations which yielded a gross loss of US$424,253.

 Mining operations were suspended at the end of June 2010 and there has been no mining operation during the three month period ended 30 June 2011 and as a result the Company incurred a gross loss for the second quarter of 2011 of US$131,197.

 

For the six month period ended 30 June 2011 the Company recorded a net loss of US$2,305,277 (4.22 US cents per share) compared to a net loss of US$2,588,183 (7.66 US cents per share) for the comparative period last year.

The reduction in the loss of approximately US$280,000 principally reflects a gain on foreign exchange of US$142,000 compared with a loss in the corresponding period for 2010 of US$273,000.

 

For the six months to 30 June 2011 there has been an increase in administration costs of US$525,000 in comparison with the same period for 2010.

At the corporate level costs have increased primarily as a result of higher staffing charges which account for US$200,000 of the increase.

 This increase reflects the higher remuneration for executive management compared with 2010, including a bonus relating to performance in 2010, of which two thirds was settled by the issue of shares paid in the first quarter and the remuneration of the new non-executive directors who were appointed at the end of Mach 2011.

The company also incurred additional costs in 2011 compared to 2010 as a result of the initial public offering of the Companys shares on the TSX.

 

 

 

Operational Highlights for the last quarter

 

• 7 April - Results from the first five drill holes of the Phase 1discovery drilling programme were released.
  
   The drilling was testing a 200m strike length of the 500m long geophysical model and significant gold intercepts were identified in all five drill holes.
  
  The style of the mineralization date appeared to be of broader width to mineral resources identified at the JDO Project to date. 

 

• 23 May - Results of an 8,000 hectare VTEM survey flown in January 2011 were released.
  
   The survey increased the area covered by VTEM to 14,000 hectares and identified a further 47 conductive electromagnetic anomalies. 

 

• 23 May - The Company announces that the integration and reprocessing of magnetic data had indicated that the structural zone hosting the Palito Deposit could extend as far to the south east as Currutela and in addition indicated the possible existence of a number of sub-parallel trending lineaments. 

 

• 13 June - Results from drilling into the Pan Handle target and initial holes into the Curretela targets were released.
  
   High grade gold intersections were identified at Currutela as drilling intersected multiple zones of hydrothermally altered granite similar to those hosting mineralization at the Palito Deposit. 

 

• 11 July - Further drill results at Currutela were released with promising assays showing further intersections of gold mineralisation in hydrothermal alteration zones. 

 

• 15 July - Following up from the integration and reprocessing of magnetic data the announced that drilling had confirmed the potential structural and mineralizes continuity of the Palito gold deposit and the Currutela gold discovery, a distance of some 2km.
  
     

 

• 11 August - The commencement of further ground geophysics (Induced Polarisation) focusing upon the potential structural continuity between the Palito gold deposit and the Currutela gold discovery some 2km away, plus recently identified anomalies at Jamanxim and Calico was announced. 

 

 

Corporate Highlights

 

• On 30 March 2011 the Company completed an Initial Public Offering ("IPO") and the listing of its Ordinary Shares and Warrants on the TSX and also completed the issue of 9,000,000 units raising gross proceeds of C$4,950,000 

 

• On 1 July 2011 Fox-Davies Capital Ltd was appointed in the UK as Broker to the Company. 

 

• On 30 June 2011, the Company had cash and cash equivalents of approximately $7.9 million.