Widespread Portfolios Market Announcement
for the 6 months to 30 September 2012
Directors: Dene Biddlecombe (Chair), Chris Castle, Jill Hatchwell, Linda Sanders, Denis Kelly
Website: www.widespread.co.nz <http://www.widespread.co.nz/>
Headquarters: Level 1, 93 The Terrace, Wellington, NZ
Postal: P O Box 231, Takaka 7142, NZ
Registered office: 1232 State Highway 60, Onekaka, Golden Bay 7172, NZ
Share registry: Link Market Services, 138 Tancred St, Ashburton
Auditors: WHK, 45
Knights Rd, Lower Hutt
Legal Advisers: Duncan Cotterill, Tower Building 50 Customhouse Qy, Wellington
Bankers: ANZ Banking Group (New Zealand) Ltd, 215-229 Lambton Qy, Wellington
Your directors submit the unaudited financial statements of Widespread Portfolios Limited for the six months to 30 September 2012. The trading result for the period was a loss of $484,000 (2011 loss $1,324,000).
We are delighted to welcome Dene Biddlecombe to the Board as our new Chairman.
Dene is a Chartered Accountant with an MBA from Otago University. He has a wealth of experience in senior management roles in the public and private sectors.
Dene recently resigned as Chief Executive Officer of NZAX listed Pulse Utilities New Zealand Ltd after leading the company through four years of tremendous growth, turning Pulse into a retail electricity company with more than 32,000 customers and total annual revenue of $55 million-plus. The company’s performance was recently recognised by winning the 2012 Deloittes Fast-50 awards.
Dene has held a number of senior executive positions including Chief Executive Officer of NZX-listed Horizon Energy Distribution Ltd in Whakatane and Chief Financial Officer and Company Secretary for NIWA where he was also responsible for the coordination of research and commercial activities in the United States. He was also Chairman of Calgary Petroleum, which was sold to Tag Oil in 2006.
Share split effect on price performance
The directors are delighted that the decision to split Widespread shares has proven to be successful. At the time when the share split was made (August 8, 2012) our shares had traded for the previous six months at an average discount of 72% to their net asset value. Since the split, the discount has steadily reduced, has averaged 20.3% for the last four weeks and is currently 13.6%.
Further, since late July the market capitalisation (total on-market value) of the company has increased from $2.8 million to $6.5 million.
Share liquidity has also increased with the monthly value of trades since the split -over nine times higher than for the previous 12 months.
While the split transformed our stock back into the
genuine penny stock it was for many years, the market value
now better reflects the value of the assets held by the
company, and increased volumes have made it easier for our
shareholders to turn these values into real cash.
Chatham Rock Phosphate
The Chatham Rock Phosphate team has made huge strides over the past six months. Key achievements include:
v Encouraging plume modeling results
Chatham Rock Phosphate
v Beneficiation tests yield promising results
v CRP centre-stage at UMI conference
v Mining licence application filed
v Edison research report values CRP at unrisked $1.87 a share
v Major economic benefits for NZ from project says NZIER
v Royal Boskalis takes 20% holding
v TSX.V plans well advanced for dual listing
v Namibian phosphate ground pegged
v Najib Moutia joins team as VP Strategy & Marketing
v Extra money spent on environmental research
CRP’s shares reached a new high
price of 46c on 9 October – doubling in two weeks – on
the back of several key milestones, since settling around
the 40c level.
The turning point in our market value was the issue of the Edison report. Share volumes in the following month exceeded those of the previous 12 months by 30% and our community of shareholders increased by 90 to 393. At 46c, the company’s market value is nearly $59 million, compared with $8.5 million in January 2012 and $22 million before the issue of 30 million shares on 24 September to Royal Boskalis and Subsea Investments..
Since then the company has:
v applied for a mining licence with New Zealand Petroleum and Minerals
v received a favourable report by Edison Investment Research stating the shares are worth $1.87 on an un-risked basis, and
v spent several days on Chatham Island widely consulting with a range of community and industry groups
v updated key government Ministers on progress.
CRP is putting a lot of effort into building strong relationships with all of its stakeholders – informing them about the project, seeking their input and keeping them advised of our project. These have included non-government organisations, officials and advisers, Iwi, media, and our shareholders.
For example, the visit to the Chatham Islands was a great opportunity to provide the community with information on our plans and to listen to their ideas. We were also able to address any concerns they had and provide information on a wide range of issues. We received a warm welcome and were able to look at potential ways the project could assist the Chatham community.
The re-rating of CRP shares is one of the more satisfying outcomes of all of the hard work put in by the team. We have generated a lot of momentum for this project and remain on track to achieve our ultimate goal of going into production on or before New Year 2015.
To achieve that we need to:
v Raise the last $US9.5 million needed to finance the work that will take us to the start of production.
v Refine our mining system design so we can start detailed designs early in 2013.
v Complete our environmental consent application to submit as soon as the EEZ regulations are complete, hopefully in the first half of 2013.
v Modify the Royal Boskalis ship that will mine the rock phosphate (planned for 2013-14).
v Receive our mining licence and marine
consents (expected during 2013).
Asian Mineral Resources
It is gratifying to see the progress being achieved by Asian Mineral Resources.. Widespread has held shares in AMR for more than a decade and the impacts of the 2008 global financial crisis and changes to the Vietnamese export tariff regime seriously affected the viability of the project for some time.
The company is now forging ahead with a revamped Board and a strong injection of new capital from Pala Investments and on-site development of the Ban Phuc nickel mine project is now in its advanced stages, with underground and surface infrastructure near completion and production planned to occur in June 2013.
Ban Phuc remains the only project of its kind in Vietnam and represents a unique platform to develop a significant nickel industry in Vietnam.
AMR recently commissioned Runge to carry out a conceptual study for a smelting operation. The results from the study indicated that the construction of a smelter would produce attractive economics for the project.
incorporation of a smelting operation is consistent with the
Government of the Socialist Republic of Vietnam’s desire
for more in-country processing and its national mineral
resources strategy to 2020, with a vision to 2030, adopted
in December 2011, where one of the key objectives is the
construction of a smelter in the Son La Province.
Oil and Gas Investments
We remain excited by the possibilities of the West Coast Kotuku oil seeps (PEP 38526) exploration permit that Widespread holds.
In July we undertook a survey to measure the resistivity of hydrocarbon-bearing rocks. The results of the resistivity survey and re-processing of seismic data will help identify drilling targets.
We are working with New Zealand Petroleum and Minerals to seek to extend our permit tenure and developing an exploration programme to identify the best way of getting to the source of the resource. Our work streams include data analysis and seismic processing of information and a site visit in November.
We are also recently undertaken a site visit to meet
with local people and update them on our
Akura Widespread holds approximately 8.3 % of Akura Limited, a Fijian-based petroleum exploration company. Akura was granted three Oil Exploration Licences (OELs) totalling ~17,000 km2 in August, 2009 and has carried out a detailed petroleum data recovery exercise, reprocessing, digitising and reinterpretation of previous seismic data and a review of past oil and gas exploration data, including the drilled wells and reported seeps.
The company is continuing to explore
possible funding options for Akura, including farm-in
King Solomon Mines (KSO)
This summer’s drilling programme has focused on the Mudhouse and Naogaoshandu prospects in Inner Mongolia, China.
A drilling programme ending in November at Mudhouse has been assessing the continuity of the mineralisation required for a preliminary resource assessment. Past drilling assays have highlighted high-grade gold intercepts, resulting in an exploration target of 100-200koz Au (1-1.5Mt at 3-5 g/t Au).
At the Naogaoshandu Gold project, KSO identified rock chip containing high-grade and visible gold samples at the East Ridge prospect. A programme of trenching has been completed, followed by an IP survey and drill programme.
Assay results are awaited.
The outlook for Widespread Portfolios remains positive. We have enough cash or near cash to sustain operations at present levels without raising further capital. While our key focus remains with advancing the Chatham Rise project, we also have a sound portfolio and we are well overdue for good news in respect of several of these investments. We are confident that one or more of these events will occur during the coming months.
For and on behalf of the
Dene Biddlecombe (Chairman) Chris Castle (Chief Executive)
25 November 2012
NZX Format Result Summary
Results for announcement to the market
Reporting Period Six months to 30 September 2012
Previous Reporting Period Six months to 30 September 2011
Amount (000s) Percentage change
Revenue from ordinary activities $201, $250 (20%)
Profit (loss) from ordinary activities after tax attributable to security holder. ($484), ($1,324) 63%
Net profit (loss) attributable to security holders. ($484), ($1,324) 63%
Dividend Amount per security Imputed amount per security
It is not proposed to pay a dividend for the reporting period. N/A N/A
Dividend Payment Date Not Applicable
Comments: A brief There has been no major changes or trends in Widespread Portfolios’ business subsequent to 30 September 2012.
Portfolios does not operate any dividend or distribution
reinvestment plan. Widespread Portfolios has not gained
or lost control over an entity during the Reporting Period.