Nompumelelo Magwaza
THE EXPLORATION and mining investment company, Randgold & Exploration, said yesterday that it had spent the financial year to December last year focusing on reducing the company’s costs and in concluding some of its legal claims.
The company said the majority of the income recognised was mainly as a result of settlements and recoveries of R158.9 million and interest earned of R13.3m on cash investments.
In the 2014 annual report released yesterday, Randgold & Exploration’s financial director Van Zyl Botha said during the past year the group’s finance team focused on reducing the cost base, the development and exploration of its remaining prospecting rights and the pursuit of legal claims to recover the company’s assets from third parties.
Legal matters
The legal matters the company is involved in are either as a result of claims bought by third parties or instituted by them.
These included class action brought by mineworkers arising from silicosis and/or tuberculosis allegedly contracted on gold mines in South Africa.
Others relate to the minority shareholders application which took place in 2011.
A recent one involved a settlement agreement between the auditing firm PwC and the Randgold & Exploration Group instituted in August 2008 with the company claiming damages from PwC arising from its alleged failure to properly audit the group.
Botha said the key task included “negotiation of terms with various parties to ensure the best possible commercial outcome for the company’s prospecting rights”.
This was done by either selling or developing and promoting them. Other tasks included instructing attorneys and legal counsel while overseeing the preparations of forensic evidence relating to various civil claims and managing the logistics associated with court proceedings.
He said the major assets of the group consisted of cash balances of R174m and prospecting rights stated at historical costs.
The group was liquid with no interest-bearing debt with net asset value a share of R2.27 at the end of December.
The group’s results were positive, with total comprehensive income for the year of R136.5m from R11m the previous year.
“The profit was mainly as a result of settlements and recoveries of R158.9m and interest earned of R13.3m on cash investments, less the cost of running the company and pursuing various lawsuits.”
Randgold & Exploration spent R17.7m on the other operating expenses, which includes R14.1m on legal and forensic fees.
Botha said the group’s 2015 outlook was largely dependent on the progress and outcome of current legal matters.
Randgold & Exploration shares on the JSE yesterday ended at R2.50, unchanged from the previous close.