As a preliminary indication, Molopo estimates that its unaudited accounting loss after tax for the financial year ending 30 June 2012 will be in the range of $58 - $63 million, due largely to the two non-cash impairment charges against the Company’s Queensland and Saskatchewan assets. This compares to a profit after tax for the financial year ended 30 June 2011 of $84.4 million, which included a before tax gain from the sale of the Company’s Spearfish assets. The before tax impairment charges are estimated as follows: ? Approximately $23 million related to the sale of the Company’s Queensland assets, which was announced on 1 August 2012. ? Between $35-$40 million which has arisen as a result of the preliminary review conducted by the Company at each reporting date of the carrying amount of its non-financial assets to determine whether there is an impairment. This charge relates to the Company’s Saskatchewan assets, which had a carrying value of approximately $56 million. Given the previously announced drilling results in the Bakken zone of Molopo’s Saskatchewan assets, the Company has determined that it is prudent to write off the unsuccessful exploration expenditure and reduce the carrying value on this asset. The above estimates are subject to adjustment as the normal year-end process to complete the audited financial statements continues to progress. The Company expects to release its audited financial statements on or around 10 September 2012.
MPO Price at posting:
53.0¢ Sentiment: Hold Disclosure: Held
