• Consolidated revenues for January - September 2009 amounted to TSEK 311,146
(TSEK 90,605). A one-off negative goodwill dissolution item amounting to TSEK
201,262 (TSEK 0) is included in the revenues for the report period and applies
to Q1.
• For the quarter July-September 2009, consolidated revenues amounted to TSEK
86,837 (TSEK 60,346).
• The net result after tax and minority interest for January-September 2009 was
TSEK 154,938 (TSEK -16,424). Excluding negative goodwill effect, the result was
negative for the nine-month period.
• For the quarter July - September 2009, the net result was TSEK -12,089 (TSEK
-7,078).
• EPS was SEK 9.086 (SEK -1.095) for January-September 2009. For the quarter
July-September 2009 EPS amounted to SEK -0.685 (SEK -0.472).
• Approved gold reserves C1/C2 are expected to reach 30 - 35 tons around the
first half of 2010. As per the report date they amount to approximately 24
tons.
• Gold production was 480 kg (170 kg) during the first nine months of 2009,
whereof 370 kg (145 kg) were produced during Q3.
• As per end of November 2009 accumulated gold production this year amounts to
approximately 645 kg, which is within the range for the revised gold production
target of 600 - 700 kg for full year 2009. It is estimated that additionally
approximately 25 kg of gold from Tardan deposit will be produced until the end
of the year, resulting in that the 2009 annual gold production will be
approximately 670 kg.
• A reversed split 200:1 was carried out in July 2009- The new number of
outstanding shares is thereafter 17,653,125, whereof 2,653,125 ordinary shares
and 15,000,000 interim shares. A trading lot on the stock exchange is 100
shares.
• CAG has signed a co-operation agreement with Chinese CIC Mining Resource Ltd.
CIC is providing support in the infrastructure build up and in identifying and
assessing potential acquisition targets, both in China and internationally.
Comments by the Managing Director
The Board of Directors of "new" Central Asia Gold strategy is to;
1. Increase the size of the company's gold reserves by;
a. Expanding proven gold reserves and long-term gold production by further
exploration of existing licenses and deposits, and
b. Pursue acquisition opportunities for both reserves and production, in Russia
as well as in nearby regions.
2. Increase the share of ore mining in order to create a base for predictable
and constant production.
As previously stated, the current year's key priorities have been to review all
the licenses and develop a clear plan for each of them. This work is done also
using one of the worlds leading mining consultancy firms. In short term our
focus has been to only operate the licenses where we have been confident to
generate operating positive cash flow in 2009. This resulted in that we
actually stopped production on some of the prior sites when finalizing the
review of mineralization and developing the plan for efficient use and return
of any future investment, primarily in ore production.
To date, we have come a good way in adjusting operations, analyzing and setting
up the company for increased size and production in 2010. We met the revised
full year 2009 production forecast 600-700 kg by the end of October. For the
full year we estimate that we will reach approximately 670 kg.
The current plan and development in brief:
• After analysing the Tardan assets, we have come to the conclusion to build a
heap leaching plant scaled to the current deposit, contingent on finalizing
financing. This investment of approximately 70 MSEK will allow the company to
capture the value of the current reserves and generate cash flow of the
magnitude close to annually 50-70 MSEK based on current gold price, i.e. a very
short pay back on such investment. This will not preclude the future expansion
of production when additional reserves at Tardan are approved since
heap-leaching operations are relatively easy to scale.
o Going forward, the work on the Tardan field will in addition be aimed at
assessing the potential of the territory, including an exploration program
focused on studying the existing area and identifying new anomalies.
• In the Staroverinskaya field, a field with the size of 250 square km with 10
different ore bodies, we have validated a total of 30 tons P1 resource based on
current exploration work done. This is of course in an early stage of
exploration, but given the great size of the area and the number of ore bodies,
there are definitely possibilities to over time being able to upgrade some of
these 30 tons to additional reserves.
o In the Kozlovskoye deposit we have conducted a geological report preparation
based on the exploration program done with approval of the 9.5 tons of
recourses at the State Reserves Committee (TKZ). We believe that during the
first half of 2010 this will be approved by State Reserves Committe, and
thereby added to the company reserves.
o In the Solcocon plant we are installing a new crushing and screening
equipment to improve ore preparation, with plant restart to process
Bogomolovskoe and Kozlovskoye oxidized ores. The current indication is that
this should likely add another 300 kg of production annually for the next 3
years.
In addition, we have also the attractive asset Kara-Beldyr, in co-operation
with the Canadian company Centerra Gold.
Having said that, we have just begun our journey. We have a clear strategy set
and the resources to make it happen. The year 2009 has been a "middle year"
where we have spent a lot of time ensuring and assessing technology in order to
optimize mineral extraction. We have thereby created a strong platform going
forward.
We have also recently entered into an agreement with CIC Mining Resources
Limited, a leading Chinese mining investment company. CIC has close relations
to a large number of gold mining companies both in China and globally and
thereby also a large number of business opportunities for its partners. CIC can
provide support both in the production and infrastructure build up. For us,
this means that we will have a strong partner with gold mine assets on a major
gold market and that we thereby have the opportunity to grow CAG operations
significantly, while mitigating company- and country risk.
In summary, we have created a new CAG stakeholder case. By focusing our core
operations on ore mining and entering new strategic partnerships we are able to
increase gold production in the short run, while building a base for
predictable and constant production.
Preston Haskell, Managing Director
(For full report, see attached file)
For more information, please contact:
CEO Preston Haskell, tel: +7 985 765 00 84, fax: +46 (0)8 624 37 20, e-mail:
preston.haskell@centralasiagold.se, website: www.centralasiagold.se, Postal and
visiting address: Engelbrektsplan 2, 4 tr., 114 34 Stockholm.
Chairman Lars Guldstrand, cell phone +46 705 28 81 81, email:
lars.guldstrand@centralasiagold.se
