RNS Number : 9118W
  Falkland Gold and Minerals Ltd
  18 June 2008
   




    FALKLAND GOLD AND MINERALS LIMITED
    ("the Company")

    INTERIM RESULTS FOR
    THE SIX MONTHS ENDED 31 MARCH 2008


    London, UK, 18 June 2008 - Falkland Gold and Minerals Limited (AIM: FGML), today announces its interim results for the six months ended
31 March 2008.


    Operational Highlights: 
    *     Closure of Falkland Island operations

    Financial Highlights:
    *     Cash balances of over �3.7 million


    Commenting on the Company's interim results, Richard Linnell, Chairman of Falkland Gold and Minerals Limited, said: 

    "The Board is continuing to look at opportunities in the resources sector and is optimistic that the Company will be able to identify a
situation with the potential to deliver value to its shareholders." 

    For more information please contact:

    Falkland Gold and Minerals Limited (www.fgml.co.uk)    
    Richard Linnell, Chairman    020 7839 8840
    Mark Fresson, Executive Finance Director    020 7839 8840

    W. H. Ireland Limited (Nominated Adviser and Broker)
    James Joyce    020 7220 1698
    Philip Haydn-Slater    020 7220 1666    

    This report is available on the Company's website, www.fgml.co.uk.


      Chairman's Statement

    We have now ceased operations in the Falklands and our withdrawal is almost complete. With the exception of the core shed, which has
been rented through to the end of the calendar year, the drilling base at Goose Green has been closed down and the drilling equipment has
been containerised ready for shipment. It is intended the office in Stanley will be vacated at the end of the month or shortly thereafter. 


    The loss after tax for the 6 months ended 31 March 2008 was �622,804 reflecting the foregoing. The reduction in cash in the period
amounted to �468,464.

    We had hoped to identify a suitable project to which to transfer our remaining exploration personnel but none of the projects examined
were considered suitable. In order to conserve cash we have now released the four man exploration team. 

    The current position is that the Company is effectively a cash shell with no material liabilities. As at 31 March 2008 the Company had
�3.7 million in cash and drilling equipment with a book value of �95 thousand.

    The Board is continuing to look at opportunities in the resources sector and is optimistic that the Company will be able to identify a
situation with the potential to deliver value to its shareholders.



 Richard Linnell
 Chairman
 18 June 2008


                                                                       Reclassified                    Reclassified
                                                                         See Note 1                      See Note 1
                                 Note   Six months ended 31     Six months ended 31    Year ended 30 September 2007
                                                 March 2008              March 2007  
                                                          �                       �                               �
 Administrative expenses                          (239,601)               (251,614)                       (618,755)
 Operating loss                                   (239,601)               (251,614)                       (618,755)
 Interest payable and similar                          (36)                       -                               -
 charges                                                                             
 Interest receivable and                            113,693                 133,173                         257,612
 similar income                                                                      
 Other income                                        32,900                  20,209                          36,146
 Loss before taxation                              (93,044)                (98,232)                       (324,997)
 Taxation                                          (23,616)                (25,303)                        (48,935)
 Loss after tax from continuing                   (116,660)               (123,535)                       (373,932)
 operations                                                                          
 Loss on discontinued               4             (506,144)               (432,892)                     (3,376,592)
 operations                                                                          
 Loss for the period                              (622,804)               (556,427)                     (3,750,524)
                                                                                     
 Loss per share expressed in                                                         
 pence per share                                                                     
 From continuing operations                                                          
 - Basic and diluted                2                (0.15)                  (0.16)                          (0.48)
 From continuing and                                                                 
 discontinued operations                                                             
 - Basic and diluted                2                (0.80)                  (0.71)                          (4.79)


    The calculation of the loss per share for the period ended 31 March 2008 is based upon the loss after tax for the period divided by the
weighted average number of shares in issue during the six month period to 31 March 2008. There is no difference between the diluted loss per
share and the basic loss per share.

    As the Company has not been able to identify any mineral deposits of economic interest, the Company's exploration programme in the
Falklands was completed during the interim period to 31 March 2008 and hence the above results have been split between continuing and
discontinued operations.

    No separate statement of recognised income and expense has been presented since all such income and expense has been dealt with in the
income statement.


        

                                                        Reclassified         Reclassified
                                                          See Note 1           See Note 1
                                Note  31 March 2008    31 March 2007    30 September 2007
                                                  �                �                    �
 Assets                                                               
 Non-Current Assets                                                   
 Intangible assets                                -        2,223,389                    -
 Property, plant and equipment               95,299          351,194              217,898
                                             95,299        2,574,583              217,898
 Current Assets                                                       
 Trade and other receivables                 40,674           66,160               39,469
 Cash and cash equivalents                3,708,752        4,916,663            4,177,216
                                          3,749,426        4,982,823            4,216,685
 Total Assets                             3,844,725        7,557,406            4,434,583
                                                                      
                                                                      
 Liabilities                                                          
 Current liabilities                                                  
 Trade and other payables                  (27,199)         (31,742)             (20,450)
 Taxation and social security              (72,544)         (77,832)             (51,324)
 Accruals and deferred income              (65,336)          (2,485)             (68,499)
 Total current liabilities                (165,079)        (112,059)            (140,273)
 Net current assets                       3,584,347        4,870,764            4,076,412
 Net assets                               3,679,646        7,445,347            4,294,310
                                                                      
                                                                      
 Issued share capital                         1,565            1,565                1,565
 Share premium                           10,209,182       10,209,182           10,209,182
 Other reserve                              250,220          199,020              242,080
 Profit and loss reserve                (6,781,321)      (2,964,420)          (6,158,517)
 Total equity                      3      3,679,646        7,445,347            4,294,310



    The interim results were approved by the Board of Directors on 18 June 2008.



                                 Note   Six months ended 31     Six months ended 31           Year ended 30
                                                 March 2008              March 2007          September 2007
                                                          �                       �                       �
                                                                                     
                                                                                     
 Pre-tax loss for the period                      (599,188)               (531,124)             (3,701,589)
 Adjustments for:                                                                    
   Net interest received                          (113,657)               (133,173)               (257,612)
   Share based payment                                8,140                  43,060                  86,120
   Depreciation and                                 361,351                 218,545               2,992,502
 amortisation                                                                        
   (Increase)/Decrease in                           (1,205)                (30,389)                 (3,698)
 receivables                                                                         
   (Decrease)/increase in                            24,806                (24,368)                   3,846
 payables                                                                            
 Cash generated from operations                   (319,753)               (457,449)               (880,431)
                                                                                     
    Net interest received                           113,657                 133,173                 257,612
   Taxes paid                                      (23,616)                (25,303)                (48,935)
                                                                                     
 Net cash outflow from                            (229,712)               (349,579)               (671,754)
 operating activities                                                                
                                                                                     
                                                                                     
                                                                                     
    Purchase of intangible                        (248,502)               (456,842)               (850,075)
 assets                                                                              
 Purchase of plant, property                        (2,331)                (59,872)                (83,911)
 and equipment                                                                       
 Proceeds from sale of plant,                        12,081                       -                       -
 property and equipment                                                              
 Net cash used in investing                       (238,752)               (516,714)               (933,986)
 activities                                                                          
                                                                                     
                                                                                     
                                                                                     
                                                                                     
 Net cash from financing                                 -                        -                       -
 activities                                                                          
                                                                                     
 Net decrease in cash and cash                   (468,464)                (866,293)             (1,605,740)
 equivalents                                                                         
                                                                                     
 Cash and cash equivalents at                    4,177,216                5,782,956               5,782,956
 the beginning of the period                                                         
                                                                                     
 Cash and cash equivalents at                    3,708,752                4,916,663               4,177,216
 end of the period                                                                   
    *     
    1. Accounting policies

    Basis of preparation

    These interim condensed financial statements are for the six months ended 31 March 2008. They have been prepared in accordance with
International Accounting Standard 34 "lnterim Financial Reporting" and the requirements of International Financial Reporting Standards' 1
'First-time Adoption of International Financial Reporting Standards' relevant to interim reports. They have been prepared on this basis as
they will form part of the period covered by the Company's first IFRS financial statements for the year ended 30 September 2008. They do not
include all of the information required for full annual financial statements, and should be read in conjunction with the financial
statements for the year ended 30 September 2007.

    These condensed interim financial statements (the interim financial statements) have been prepared in accordance with the accounting
policies set out below which are based on the recognition and measurement principles of IFRS in issue and as adopted by the European Union
(EU) and are effective at 30 September 2008 or are expected to be adopted and effective at 30 September 2008, our first annual reporting
date at which we are required to use IFRS accounting standards adopted by the EU.

    The financial statements have been prepared under the historical cost convention on a going concern basis.

    The policies have changed from the previous year when the financial statements were prepared under applicable United Kingdom Generally
Accepted Accounting Principles (UK GAAP). The comparative information has been reclassified in accordance with IFRS. The changes to
accounting policies are explained in note 2 with the transition statement which shows the reconciliation of opening balances. The date of
transition to lFRS was 1 October 2006.

    The Company has taken advantage of certain exemptions available under IFRS 1 First-time adoption of International Financial Reporting
Standards. The exemptions used are explained under the respective accounting policy, where appropriate.

    The results for the six months to 31 March 2008 are unaudited and do not constitute statutory accounts within the meaning of Section 240
of the Companies Act 1985.  

    The financial information for the year ended 30 September 2007 has been derived from the Company's audited financial statements for the
year as filed with the Registrar of Companies. The auditor's report on the statutory financial statements for the year ended 30 September
2007 was not qualified and did not contain a statement under section 237(2) or (3) of the Companies Act 1985. 

    Going Concern
    The financial statements are prepared on the going concern basis, which the directors believe to be appropriate for the following
reasons. The directors have decided that despite the cessation of work programs in the Falkland Islands, due to the failure to identify
deposits of commercial interest, the Company will continue with its ongoing purpose of exploration activities and the directors are actively
pursuing and considering alternative prospects outside the Falkland Islands. The Company has access to drilling contractors and is well
equipped with the appropriate operational hardware which can be deployed to other mineral prospects.

    At the interim balance sheet date, the Company had cash balances totalling �3.7 million, sufficient to support an annual level of
exploration activity, similar to that undertaken on the Falkland Islands over the last few years, for between 18 months and 2 years. On this
basis, the directors consider that the Company will continue in operational existence for the foreseeable future by meeting its liabilities
as they fall due. As is common with many exploration companies, the Company may need to raise additional funds for exploration and capital
projects as and when required.


    1. Accounting policies (continued)

    However, there can be no certainty in relation to these matters, which may cast significant doubt on the Company's ability to continue
as a going concern. The Company may therefore be unable to continue realising its assets and discharging its liabilities in the normal
course of business, but the interim financial statements do not include any adjustments that might result from the basis of preparation
being inappropriate.

    Deferred exploration costs
    All costs associated with mineral exploration and investments are capitalised on a project by project basis, pending determination of
the feasibility of the project. Costs incurred include appropriate technical and administrative expenses, but not general overhead. If an
exploration project is successful, the related expenditures will be transferred to intangible assets and amortised over the estimated life
of the commercial ore reserves on a unit of production basis. Where a licence is relinquished, a project is abandoned, or considered to be
of no further commercial value to the Company, the related costs are written off.

    The recoverability of deferred exploration costs is dependent upon the discovery of economically recoverable reserves, the ability of
the Company to obtain necessary financing to complete the development of reserves and future profitable production or proceeds from the
disposition thereof.

    Ceiling tests
    Where there is an indication that the value of a mining asset may be impaired, the net amount at which the asset is recorded is assessed
for recoverability against the estimated discounted future estimated net cashflows expected to be generated from the estimated remaining
commercial reserves. This assessment is made on the basis of future mineral prices, exchange rates and cost levels as forecast at the
balance sheet date. A provision is made, by way of an additional depreciation charge, where the carrying value of the asset exceeds the
discounted future net cashflows to be derived from its estimated remaining commercial reserves.

    Exploration licence
    The exploration licence is amortised on a straight line basis over the life of the licence.

    Decommissioning, site restoration and environmental costs
    Licensees are generally required to restore mine and processing sites at the end of their producing lives to a condition acceptable to
the relevant authorities. The expected cost of any decommissioning or restoration program, discounted to its net present value, is provided
and capitalised at the beginning of each project development. The capitalised cost is amortised over the life of the operation and the
increase in the net present value of the provision for the expected cost is included with interest payable and similar items.

    The cost of ongoing programs to prevent and control pollution and to rehabilitate the environment is charged to the income statement as
incurred.

    Tangible fixed assets
    All fixed assets are stated at cost. 

    Depreciation
    Depreciation is provided on all tangible fixed assets on a straight line basis over their estimated lives. Assets are depreciated from
the date of acquisition. Depreciation rates and methods are reviewed annually for appropriateness. When changes are made, adjustments are
reflected prospectively in current and future periods only.

    Property, plant and equipment:        33.33% straight line

    Depreciation in respect of exploration and evaluation expenditure is referred to within the accounting policies.


    1. Accounting policies (continued)

    Foreign currency
    Assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the balance sheet date.
Transactions in foreign currencies are recorded at the rate ruling at the date of the transaction. All differences are taken to the income
statement.

    Leases
    Rentals paid under operating leases are charged to the income statement as incurred.

    Deferred taxation
    Deferred tax is recognised in respect of all timing differences that have originated, but not reversed, at the balance sheet date where
transactions or events that result in an obligation to pay more tax in the future or a right to pay less tax in the future have occurred at
the balance sheet date. Timing differences are differences between the company's taxable profits and its results as stated in the financial
statements that arise from the inclusion of gains and losses in tax assessments in periods different from those in which they are recognised
in the financial statements. 

    Deferred tax is measured at the average tax rates that are expected to apply in the periods in which timing differences are expected to
reverse, based on tax rates and laws that have been enacted or substantially enacted by the balance sheet date. Deferred tax is measured on
a non-discounted basis.

    Pension contributions
    The Company contributes to the personal pension plans of certain employees only. Contributions are charged to the income statement as
they become payable in accordance with the rules of the scheme.

    Share based payments
    The Company is required to measure the fair value of equity settled transactions with employees at the grant date of the equity
instruments. The fair value is determined by using the Black-Scholes method. This requires assumptions regarding dividend yields, risk-free
interest rates, share price volatility and expected life of an employee share option.

    Cash and cash equivalents
    Cash and cash equivalents comprise cash on hand and demand deposits, together with the other short-term, highly liquid investments that
are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value. In addition, bank
overdrafts which are repayable on demand are included.

    Discontinued operations
    A discontinued operation is a component of the Company's business that represents a separate major line of business. Classification as a
discontinued operation occurs upon disposal or when the operation meets the criteria to be classified as held for sale, if earlier.


    2. Explanation of transition to IFRS

    As stated in the Basis of Preparation, these are the Company's first condensed interim financial statements for part of the period
covered by the first IFRS annual financial statements prepared in accordance with IFRS. 

    The transition from UK GAAP to IFRS has not affected the Company's financial position, financial performance and cash flows and
consequently there are no reconciling adjustments between the previously reported UK GAAP numbers and the numbers reported under IFRS.



    3. Statement of changes in equity

                                 Issued share Capital  Share Premium  Other reserve       Profit and loss        Total
                                                                                                  reserve
                                                    �              �              �                     �            �
 Balance at 1 October 2006                      1,565     10,209,182        155,960           (2,407,993)    7,958,714
 Changes in equity for the
 first half of 2006/07
 Recognition of equity settled                      -              -         43,060                     -       43,060
 share based payment
 Loss for the period                                -              -              -             (556,427)    (556,427)
 Balance at 31 March 2007                       1,565     10,209,182        199,020           (2,964,420)    7,445,347
 Changes in equity for the
 second half of 2006/07
 Recognition of equity settled                      -              -         43,060                     -       43,060
 share based payment
 Loss for the period                                -              -              -           (3,194,097)  (3,194,097)
 Balance at 30 September 2007                   1,565     10,209,182        242,080           (6,158,517)    4,294,310
 Recognition of equity settled                      -              -          8,140                     -        8,140
 share based payment 
 Loss for the period                                -              -              -             (622,804)    (622,804)
 Balance at 31 March 2008                       1,565     10,209,182        250,220           (6,781,321)    3,679,646


    4. Discontinued operations

 Analysis of income statement result:
                                  Six months ended 31      Six months ended 31 March    Year ended 30 September 2007
                                           March 2008                           2007                              � 
                                                                                      
                                                                                      
                                                  �                              �    
                                                                                      
 Administrative expenses                    (257,642)                      (432,892)                       (733,710)
 Impairment of exploration                  (248,502)                              -                     (2,642,882)
 assets                                                                               
 Loss on discontinued                       (506,144)                      (432,892)                     (3,376,592)
 operations                                                                           
 Analysis of cash flow                                                                
 movement:                                                                            
 Operating                                  (147,718)                      (285,366)                       (432,132)
 Investing                                  (238,752)                      (516,714)                       (933,986)
 Financing                                          -                              -                               -
                                            (386,470)                      (802,080)                     (1,366,118)


This information is provided by RNS
The company news service from the London Stock Exchange
 
  END 
 
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