El Oro& Exploration - Interim Results

RNS Number:1706R
El Oro And Exploration Co Plc
31 March 2008

El Oro and Exploration Company plc

31 March 2008

Interim Results

El Oro and Exploration Company plc (the "Company") announces its interim results
for the six months ended 31 December 2007.

The interim results for the six months ended 31 December 2007 will be posted to
shareholders and are available on the Company's website www.eloro.co.uk.
Extracts from these financial statements are set out below.

For further information, please contact:

C Robin Woodbine Parish: Chairman
Steven McKeane: Company Secretary
El Oro and Exploration Company plc
Tel: 020 7581 2782

Philip Secrett: Nominated Adviser
Grant Thornton Corporate Finance
Tel: 020 7383 5100

EL ORO AND EXPLORATION COMPANY plc

CHAIRMAN'S STATEMENT

Results for the period ended 31 December 2007

The Group profit before tax for the six months to 31 December 2007 was
£4,810,071 (six months to 31 December 2006: £3,049,025). Group net assets at 31
December 2007 under IFRS, taking all assets at fair value were £81,588,816 equal
to 757p per stock unit, (31 December 2006: £77,167,354 equal to 712p per stock
unit).

'When them as wallers in sin thinks they's getting by with it, she said, that's
when He strikes em in His holy wrath. He jest bides His time'. "Cormac McCarthy
- The Orchard Keeper".

The results for the half-year have since been overshadowed, by continuing
turmoil in the financial markets; the collapse of funds such as Peloton, Focus
and Carlyle Capital amongst others, and more significantly the rescue of Bear
Stearns, underline the gravity of storms swirling through Western economies. An
analysis of the indebtedness of some Baltic and East European nations, along
with Iceland and Turkey, can only exacerbate this sense of foreboding.

Sadly, in no wise is this the story of events unforetold: the consistent
condemnation of derivatives from the hallowed halls of Omaha and Pasadena,
warnings from the Governor of the Bank of England and the unremitting
Cassandra-like criticism of the US credit boom by the late Dr. Richebacher
amongst others, were all happily ignored in the Gadarene rush to amass ever more
Gargantuan empires based, as it now appears, on foundations of sand.

The monstrous maelstrom mowing down the mighty and the minnows has made the
proud and powerful into mendicant monks seeking salvage from the Federal Reserve
or the Bank of England; meanwhile their erstwhile leaders set off into the sun
clutching their Brobdingnagian booty, regardless of seeming success or apparent
failure.

We have not been immune to declines in the price of property assets as the
market anticipates a falling residential and commercial property market. With a
wearyingly familiar sense of inevitability, where market conditions of
themselves are challenging, Government action has or will exacerbate the
situation: in the case of property by imposing rates on vacant property, along
with the ridiculous HIPS on residential property; in the case of our Brewery
Estate investments, by the malicious assault on smoking within the confines of
the pubs, followed hard on its heels by the determination to banish the sale of
cigarette vending machines; the decline in profits is beginning to become
apparent, albeit in the dim light of dawn. This attack on the pub sector has
been compounded by raising the tax on alcohol over and above inflation.
Historically, well managed and monitored pubs have presented a secure and
agreeable venue for moderate drinking and convivial encounter; wholly at
variance with the effects of the Government's 24-hour drinking and changes to
the licensing laws; to which a Parliamentary committee has attributed the spread
of lager louts in city centres, and other unattractive phenomena.

As if this madness was not enough, the eponymous Harman now proposes to ban
repartee and terms of endearment from bars and stores, to give those litigious
members of society another chance to sue for supposed or imagined slights. What
a desperate state of affairs, to see our vocabulary monitored by the legal
profession, under the guise of preventing 'sex discrimination' and our
hostelries emasculated and age-old beverages consigned to history by ministers
and civil-servants in their plush glass palaces drinking lattes and frattes,
whilst imposing ever-more onerous taxes and restrictions on the traditional
tipples and tittle-tattle of the British people.

This urge to interfere and 'act', rather than 'sitting pretty, doing nothing' is
only too apparent, now that the Government has seen the light and embraced the
birth of a new Nuclear Age: sadly, it sold Westinghouse, the leader in that
field, to Toshiba, in the same futile fashion it flicked away Qinetiq to
Carlyle, and our historic Gold reserves: all first-class National assets.

The British Government has paid obscene obeisance to the European Union,
ignoring every promise and poll to align us with that unholy herd, and now
assaults the Old Commonwealth and its rights of entry, despite the longevious
and formidable ties of blood, trade, tradition and civilisation shared over so
many years, with its huge contribution to trade and economy for all parties.
Such a perverse policy reaches its nadir in the refusal of residence rights to
the Gurkha soldiers who have fought so valiantly to defend us; whilst Post
Offices and Village Schools fall to the same Statist or Stalinist philosophy;
hill farms and the landscape are discarded, and non-doms are sacrificed for a
mess of pottage; playing-fields, including those of Jersey, are pillaged, and
even mince-meat, a staple of the beef industry, is confronted with a mad new EU
directive; it is remarkable indeed, given the vast reduction in public swimming
pools, despite an obligation for their provision, and almost complete
destruction of diving-boards, that England can suddenly discover a European
Diving Champion.

The attack on 'Risk' is now a central plank of national 'elf and safety' policy,
producing generations less and less able to cope with the every day and more
substantial crises of life. It also engenders a vast infrastructure which, as
the FSA has proved, is horrendously expensive and ultimately incapable of
dealing with situations once resolved discreetly, or managed with a raised
eyebrow in the confines of the old establishment, but mostly driven by common
sense and discernment.

The necessity and obligation facing our economy to cut both taxes and spending
significantly has been denied by all parties, particularly the Conservatives in
their Cyclops-post-Odysseus blindness driven by the inchoate urging of their
spineless strategists. The symbolism of Banana Republic's arrival in Britain is
perhaps apposite.

The deflation of domestic residences whose rise had created the credit boom both
in Britain and the United States is now making its sombre black marks in the
history books: quite possibly further wreckage may yet descend from the ether as
the deflated balloon subsides across the Western world and beyond. This has
profound and negative consequences for consumer spending which is no longer
underpinned by an annual increase in the value of an underlying asset. For the
first time since 1945 the share of equity held by the individual in homes in the
United States has fallen below 50%.

Proverbs 11 v 13 state; 'Happy is the man that findeth wisdom and the man that
getteth understanding. For the merchandise of it is better than the merchandise
of silver and the gain thereof than fine gold.'

Wisdom and vision have been sadly lacking amongst our political and business
leaders and the day of Reckoning is upon them. Given this absence, our vision is
for the continued accumulation of the alternative, both Silver and Gold and the
shares thereof. We congratulate Colin Loosemore of Archipelago in finally
securing the remit to develop the exciting mine at Toka Tindung. We have visited
other promising projects in Chile and Argentina whilst remaining wary of
political interference in various parts of the world. The inability of South
Africa to provide adequate power for its burgeoning population and industry has
enhanced metal prices for both Gold and Platinum. We are also increasing our
exposure to the production of food, fertilizer and agricultural products and are
heartened by the continued rise in MP Evans, an outstanding performer in the
portfolio.

In conclusion the outlook for retail and housing remains distinctly gloomy,
whilst the continuing rise in inter-bank rates bodes ill for the entire
financial sector. We would be surprised albeit happy at any pick up in property
prices.

We are however well placed in our traditional areas of strength particularly
Basic Resources, Energy and Precious Metals. We would expect the latter
especially to thrive in the current climate, and will attempt to restrain our
excitement.

My thanks are due to my peripatetic Directors, our numerous advisers around the
world, and the increasingly formidable team in Cheval Place led by Steve
McKeane, Abbie playing in Midfield, and Vicky solid in defence: the Rooney,
Ronaldo, Vidic triumvirate. Onwards to Victory.

Robin Woodbine Parish
31 March 2008

EL ORO AND EXPLORATION COMPANY plc

CONSOLIDATED INCOME STATEMENT

(Unaudited)
for the six months ended 31 December six months to six months to
31 December 31 December
2007 2006
£ £
Revenue 1,326,876 6,978,291
Movement in fair value 8,661,186 (199,439)
Impairment loss on available for sale
investments (3,140,729) (2,174,506)
Expenses (922,373) (909,295)
------------ ------------
Profit before finance costs and taxation 5,924,960 3,695,051
Finance costs:
Banks 1,114,889 646,026
------------ ------------
1,114,889 646,026
------------ ------------
Profit before taxation 4,810,071 3,049,025
Taxation 1,511,254 870,816
------------ ------------
Profit for the period 3,298,817 2,178,209
------------ ------------
Earnings per stock unit (basic and
diluted) 30.44p 20.10p
------------ ------------

CONSOLIDATED STATEMENT OF CHANGES IN INCOME AND EXPENSE

(Unaudited)
for the six months ended 31 December six months to six months to
31 December 31 December
2007 2006
£ £
Profit for the period 3,298,817 2,178,209
Revaluation of available for sale (AFS)
investments during the period (1,182,555) 9,835,193
Deferred tax on revaluation of AFS
investments during the period 441,047 (2,950,558)
------------ -----------
Total recognised income and expense for
the period 2,557,309 9,062,844
------------ -----------

CONSOLIDATED BALANCE SHEET

(Unaudited)
As at 31 December
31 December 31 December
2007 2006
Assets £ £
Non-current assets
Property, plant and equipment 716,127 734,895
Investment properties 504,504 444,933
----------- -----------
1,220,631 1,179,828
----------- -----------
Current assets
Trade and other receivables 128,025 191,408
Financial assets:
Available for sale investments 126,012,539 116,492,915
Financial assets - fair valued through the income statement:
Commodities 2,892,093 2,146,315
Cash and cash equivalents 1,505,262 236,565
----------- -----------
130,537,919 119,067,203
----------- -----------
Liabilities
Current liabilities
Financial liabilities:
Borrowings 16,285,214 23,564,269
Trade and other payables 915,462 422,470
Current tax liabilities 1,276,394 1,211,438
----------- -----------
18,477,070 25,198,177
----------- -----------
Net current assets 112,060,849 93,869,026
----------- -----------
Non-current liabilities
Borrowings 15,000,000 -
Deferred taxation 16,692,664 17,881,500
----------- -----------
31,692,664 17,881,500
----------- -----------
Net assets 81,588,816 77,167,354
----------- -----------
Stockholders' equity
Ordinary stock units 538,825 539,210
Share premium 6,017 6,017
Capital redemption reserve 347,402 347,018
Merger reserve 3,564 3,564
Other reserves 43,682,572 42,653,699
Retained earnings reserve 37,010,436 33,617,846
----------- -----------
Total equity 81,588,816 77,167,354
----------- -----------

CONSOLIDATED CASH FLOW STATEMENT

(Unaudited)
for the six months ended 31 December six months to six months to
31 December 31 December
2007 2006
£ £

Cash flow from operating activities 4,868,131 569,923
Income taxes paid (1,219,555) (503,787)
----------- -----------
3,648,576 66,136
----------- -----------
Cash flow from investing activities - (271,780)
----------- -----------
Cash flow from financing activities (2,529,519) (1,922,508)
----------- -----------
Net increase/(decrease) in cash and cash
equivalents 1,119,057 (2,128,152)
----------- -----------
Cash and cash equivalents at 30 June (30,891,807) (20,648,219)
Effect of foreign exchange rate changes 301,747 (259,132)
----------- -----------
Cash and cash equivalents at 31 December (29,471,003) (23,035,503)
----------- -----------

EL ORO AND EXPLORATION COMPANY plc

NOTES TO THE UNAUDITED CONSOLIDATED INTERIM FINANCIAL INFORMATION

The Unaudited Consolidated Interim Financial Information ("Financial
Information") for the six months ended 31 December 2007 does not constitute
statutory accounts within the meaning of section 240 of the Companies Act 1985.
The Financial Information has been prepared using accounting policies and
principles consistent with those applied in the preparation of the audited
accounts of El Oro and Exploration Company plc for the year ended 30 June 2007.
No changes were made to those policies in the preparation of this Financial
Information. The Directors have elected not to adopt IFRS 8 "Operating Segments"
early.

There was an interim dividend of 13.2 pence paid on 25 October 2007 in relation
to the year ended 30 June 2007.

The Financial Information was approved by a Committee of the Board of Directors
on 31 March 2007.

The Financial Information has not been subject to review or audit by the Group's
Auditor, PriceWaterhouseCoopers LLP.

REVENUE six months to six months to
(Unaudited) 31 December 31 December
2007 2006
for the six months ended 31 December £ £

Dividends from listed available for sale
investments 1,043,902 1,006,036
Dividends from unlisted available for
sale investments 244,751 146,775
Net gains/(losses) on fair value through
the income statement investments 326,355 (80,828)
Net profit on available for sale
investments realised 7,024,971 5,993,499
Currency translation gains/(losses) 1,309,860 (110,619)
Other income 38,223 23,428
----------- -----------
9,988,062 6,978,291
----------- -----------

EL ORO AND EXPLORATION COMPANY plc

NOTES TO THE UNAUDITED CONSOLIDATED INTERIM FINANCIAL INFORMATION

RESERVES Share Capital Merger Other Retained
premium redemption earnings

At 1 July 2007 6,017 347,402 3,564 49,482,060 35,134,116
Movement in
period in
values of AFS
assets (1,182,555)
Tax provided
on above 441,047
Fair value of
AFS
investments
recycled to
income
statement (7,024,971)
Tax relief on
above 1,966,991
Profit for the
period 3,298,818
Dividends paid (1,422,498)
-------- --------- ------ --------- ---------
At 31 December
2007 6,017 347,402 3,564 43,682,572 37,010,436
-------- --------- ------ --------- ---------

RESERVES Share Capital Merger Other Retained
premium redemption earnings

At 1 July 2006 6,017 344,442 3,564 38,069,136 33,005,519
Purchase and
cancellation
of own shares 2,576 (271,780)
Movement in
period in
values of AFS
assets 9,835,193
Tax provided
on above (2,950,558)
Fair value of
AFS
investments
recycled to
income
statement (3,285,817)
Tax relief on
above 985,745
Profit for the
period 2,178,209
Dividends paid (1,294,102)
-------- --------- ------ --------- ---------
At 31 December
2006 6,017 347,018 3,564 42,653,699 33,617,846
-------- --------- ------ --------- ---------

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

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