WAD West African

 

TIDMWAD 
 
RNS Number : 1820F 
West African Diamonds PLC 
07 January 2010 
 

 
 
 
 
 
 
 
 
 
 
7th January 2010 
 
 
INTERIM STATEMENT FOR THE SIX MONTHS ENDING OCTOBER 31st 2009 
 
 
 
 
In the six months under review, WAD did well. The Bomboko mine came on stream. 
Diamond sales realised an average $117 per carat at auction. This was lower than 
expected due to poor market conditions in early 2009, but due to a marked 
recovery in the diamond market in the latter part of 2009 higher prices are 
expected. The Company made the decision to continue with an expansion programme 
by installing an additional plant to boost production capacity. The mine is now 
fully operational and capable of producing 1500 carats a month. 
 
 
Joint ventures were agreed on both of our Sierra Leone projects. This relieves 
WAD of financial obligations and allows us to focus our resources on delivering 
cash flow from Bomboko. We transferred our interest in the Pipe 3 kimberlite and 
surrounding dykes to Thunderball, a Lebanese/ Japanese consortium with an 
aggressive plan for exploration and exploitation.  WAD retains a 20 per cent 
free carry though to production. 
The WAD mining licence over the Plant 11 undersize tailings near Koidu has been 
transferred to a local company, Pyramid Resources, in return for a 5 per cent 
production royalty. Pyramid will mine diamonds from the tailings. 
 
 
The highlight of the recent period has been the decision in principle to merge 
West African Diamonds (WAD) with Stellar Diamonds, a privately held diamond 
explorer and miner. 
The combined venture, which subject to approvals and a successful fundraise, 
will relist in quarter one 2010, will have two producing diamond mines in 
Guinea, Bomboko and Mandala, as well as three joint ventures in Sierra 
Leone.  The new company will also hold 100% interests in two high grade 
kimberlite projects, Droujba in Guinea and Tongo in Sierra Leone. 
 
 
The agreement being proposed to shareholders will combine WAD and Stellar on a 
25/75 % basis, prior to new funding.  Subject to successful funding, the new 
enlarged company will increase mining capacity and revenue at both existing 
alluvial mines as well as continuing development of the kimberlite projects. 
 
 
The Board of WAD considered the company too small to attract significant 
investor interest and deemed it essential to grow by consolidation. Merging with 
Stellar will result in a company with two producing mines delivering robust cash 
flow. The planned financing will strengthen the balance sheet and enable our 
high grade kimberlite projects to be developed. The Company will continue to 
grow by consolidation activity in what is a fragmented and undervalued industry. 
 
 
 
 
 
Enquiries: 
 
 
+----------------------------------+-------------------------+ 
| West African Diamonds            |                         | 
+----------------------------------+-------------------------+ 
| John Teeling, Chairman           |  + 353 1 8332833        | 
+----------------------------------+-------------------------+ 
| James Campbell, Deputy Chairman  |  +27 83 457 3724        | 
|                                  |                         | 
+----------------------------------+-------------------------+ 
| Astaire Securities               | +44 (0)20 7448 4400     | 
| Lindsay Mair / Toby Gibbs        |                         | 
+----------------------------------+-------------------------+ 
| College Hill                     | +44 (0) 20 7457 2020    | 
| Nick Elwes                       |                         | 
+----------------------------------+-------------------------+ 
 
 
 
 
www.westafdiamonds.com 
 
 
 
 
 
 
+----------------+---------+--------+---------+--------+----------+--------+-----------+--------+-------------+--------+----------+ 
|                                                                                                                                 | 
+---------------------------------------------------------------------------------------------------------------------------------+ 
|                                                    West African Diamonds plc                                                    | 
+---------------------------------------------------------------------------------------------------------------------------------+ 
|                                                Financial Information (Unaudited)                                                | 
+---------------------------------------------------------------------------------------------------------------------------------+ 
|                |         |        |         |        |          |        |           |        |             |        |          | 
+----------------+---------+--------+---------+--------+----------+--------+-----------+--------+-------------+--------+----------+ 
| Condensed                |        |         |        |          |        |        Six Months Ended          |        |  Year    | 
| Consolidated             |        |         |        |          |        |                                  |        |  Ended   | 
| Income                   |        |         |        |          |        |                                  |        |          | 
| Statement                |        |         |        |          |        |                                  |        |          | 
+--------------------------+--------+---------+--------+----------+--------+----------------------------------+--------+----------+ 
|                |         |        |         |        |          |        |  31 Oct   |        |   31 Oct    |        |    30    | 
|                |         |        |         |        |          |        |    09     |        |     08      |        |  April   | 
|                |         |        |         |        |          |        |           |        |             |        |    09    | 
+----------------+---------+--------+---------+--------+----------+--------+-----------+--------+-------------+--------+----------+ 
|                |         |        |         |        |          |        |unaudited  |        |  unaudited  |        | audited  | 
+----------------+---------+--------+---------+--------+----------+--------+-----------+--------+-------------+--------+----------+ 
|                |         |        |         |        |          |        |  GBP'000  |        |  GBP'000    |        | GBP'000  | 
+----------------+---------+--------+---------+--------+----------+--------+-----------+--------+-------------+--------+----------+ 
|                |         |        |         |        |          |        |           |        |             |        |          | 
+----------------+---------+--------+---------+--------+----------+--------+-----------+--------+-------------+--------+----------+ 
| Revenue        |         |        |         |        |          |        |       135 |        |          27 |        |       27 | 
+----------------+---------+--------+---------+--------+----------+--------+-----------+--------+-------------+--------+----------+ 
| Cost           |         |        |         |        |          |        |     (135) |        |        (27) |        |     (27) | 
| of             |         |        |         |        |          |        |           |        |             |        |          | 
| sales          |         |        |         |        |          |        |           |        |             |        |          | 
+----------------+---------+--------+---------+--------+----------+--------+-----------+--------+-------------+--------+----------+ 
| Gross          |         |        |         |        |          |        |         0 |        |           0 |        |        0 | 
| profit         |         |        |         |        |          |        |           |        |             |        |          | 
+----------------+---------+--------+---------+--------+----------+--------+-----------+--------+-------------+--------+----------+ 
|                |         |        |         |        |          |        |           |        |             |        |          | 
+----------------+---------+--------+---------+--------+----------+--------+-----------+--------+-------------+--------+----------+ 
| Administrative |         |        |         |        |          |        |     (128) |        |       (113) |        |    (247) | 
| expenses       |         |        |         |        |          |        |           |        |             |        |          | 
+----------------+---------+--------+---------+--------+----------+--------+-----------+--------+-------------+--------+----------+ 
| OPERATING      |         |        |         |        |          |        |     (128) |        |       (113) |        |    (247) | 
| LOSS           |         |        |         |        |          |        |           |        |             |        |          | 
+----------------+---------+--------+---------+--------+----------+--------+-----------+--------+-------------+--------+----------+ 
|                |         |        |         |        |          |        |           |        |             |        |          | 
+----------------+---------+--------+---------+--------+----------+--------+-----------+--------+-------------+--------+----------+ 
| Investment     |         |        |         |        |          |        |         0 |        |           0 |        |        3 | 
| income         |         |        |         |        |          |        |           |        |             |        |          | 
+----------------+---------+--------+---------+--------+----------+--------+-----------+--------+-------------+--------+----------+ 
| Finance        |         |        |         |        |          |        |       (2) |        |        (11) |        |      (2) | 
| costs          |         |        |         |        |          |        |           |        |             |        |          | 

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