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Creat Resources Hld CRHL Final Results for year ended 30 June 2012

  Creat Resources Hld (CRHL) - Final Results for year ended 30 June 2012

RNS Number : 3180Q
Creat Resources Holdings Ltd
05 November 2012




5 November 2012

                       Creat Resources Holdings Limited

                          ("CRHL" or "the Company")
                  Final Results for year ended 30 June 2012

                                      

Creat Resources Holdings Limited ("CRHL")  (AIM: CRHL) is pleased to  announce 
its final results for  the year ended  30 June 2012 as  shown below. The  full 
Annual Report  and  Accounts  will  be  available  on  the  Company's  website 
(www.creatresources.com) shortly.



The notice of the Annual General Meeting and posting of the Annual Report  and 
Accounts will be announced in due course.



For further information please visit www.creatresources.com or contact:



Creat Resources Holdings Limited

Morris R. Hansen, Company Secretary: Tel +613 6471 6228



Daniel Stewart & Company

Paul Shackleton, Emma Earl, Jamie Barklem: Tel +44 20 7776 6550







Chairman's Statement



Dear Shareholders:



I am pleased to present to you  the Annual Report of Creat Resources  Holdings 
Limited for the year ended 30 June 2012.



The year just ended was, and the year ahead will be, filled with  challenges. 
The European  financial crisis  deepening, rather  than easing;  the  American 
economy remaining sluggish and the  slowing down of developing countries,  all 
contributed to  the  weak  demand  for lower  end  resources.  Extraction  of 
resources from  our tenements  would  only be  economically viable  when  such 
situations dramatically improve, and the low commodity prices rebound.



During the year, as with  other similar exploration companies, development  at 
Creat Resources had  been hindered by  the shortage of  working capital.  The 
financial crisis worldwide  made it difficult,  if at all  possible, to  raise 
funds from the capital market. Despite the support we received from our major
shareholder, Creat Group Company Limited, we  have no alternative but to  keep 
our exploration work  to a level  we could  manage to best  balance input  and 
output.



Towards the end of  the financial year, your  Board of Directors  reconsidered 
the way forward for our exploration  activities. By now, you would note  that 
the Board has recommended for your approval the disposal of all the  tenements 
we hold at Zeehan, Tasmania, Australia. By such move, I trust that it  allows 
your Company to start afresh.  Myself, and the rest  of the Board, have  long 
begun our search for new and  even better opportunities to enhance the  return 
on your investment.



At the same time, our other  major investment in Galaxy Resources Limited  has 
made milestone progress. In March 2012, Jiangsu Lithium Carbonate Plant which
is wholly owned by Galaxy and situated in the Zhangjiagang Free Trade Zone  in 
China's  Jiangsu  Province  was  officially  opened.  Jiangsu  Plant  is  the 
largest-capacity battery  grade lithium  carbonate plant  in theAsia  Pacific 
region and is one of the  most technologically advancedplants of its kind  in 
the world.



Also in March 2012, Galaxy announced the merger with Lithium One Inc., Canada,
which when  completed,  resulted in  Galaxy  becoming a  much  larger  lithium 
resource  supplier  worldwide  demonstrating  Galaxy's  understanding  of  the 
importance of this strategic green  energy source. Following the merger,  the 
effective shareholding of Galaxy by Creat Resources was inevitably diluted but
we remain one of the substantial shareholders of Galaxy, leaving us, CRHL, set
to realize a high  return on our  investment when the  potential of Galaxy  is 
unleashed.



Please join me in expressing our  gratitude to the Board, the management  team 
and all the staff, in this time of challenge, their dedication is the envy  of 
our competitors.



We thank you for,  and we look forward  to receiving, your continuing  support 
for a brighter future for your company.





Derek Leung        

Executive Chairman 









Excerpts from Directors report



Principal activities



The principal activities of the Consolidated Entity during the financial  year 
were minerals exploration  and the acquisition,  exploration and operation  of 
mineral properties in both Australia and overseas.



The Company  was admitted  to trading  on AIM  on 6  March 2007.  The  Company 
initially focused  on zinc,  lead  and silver  deposits in  Western  Tasmania, 
Australia. Since July 2009 the Company has pursued a strategy of acquisitions
and other transactions that has resulted in expansion of its mining operations
within and  outside Australia  and resource  diversification (including  gold, 
nickel, and a continued focus on lead, zinc and silver) in order to spread the
risk of commodity fluctuations and take advantage of the deals on offer.



Operating results



The loss of the  Consolidated Entity for the  year after providing for  income 
tax amounted to$13,673,981 (2011 loss: $20,439,089).



Review of operations



The Company is pursuing  a dual strategy of  acquiring interests in  strategic 
resource companies,  the  first of  which  is Galaxy  Resources  Limited,  and 
resource diversification through its exploration activities.



 Galaxy Resources Ltd Investment

Galaxy Resources Limited  ("Galaxy") is  a Western  Australian S&P  / ASX  300 
Index company which plans  to become one of  the world's leading producers  of 
lithium compounds  - the  essential component  for powering  the world's  fast 
expanding fleet of hybrid and electric cars. Galaxy's Mt Cattlin mine aims  to 
be  the  world's  second  largest  producer  of  lithium  mineral  concentrate 
globally, and  through the  development of  its 17,000  tpa lithium  carbonate 
plant in Jiangsu province, Galaxy expects to be one of the largest and  lowest 
cost lithium compound producers  in China. Lithium  compounds such as  lithium 
carbonate are forecast to be in short supply against high future demand due to
advances in long life batteries and sophisticated electronics including mobile
phones and computers. Galaxy has positioned itself to meet this lithium future
by not only mining  the lithium, but also  by downstream processing to  supply 
lithium carbonate to the expanding Asian market.



The Company's  shareholding in  Galaxy remains  at 38,091,616  shares.  Whilst 
there has been no change  in the number of shares  held by the Company  during 
the reporting period, as a result of the placement of shares to raise  capital 
for the financing of the merger of Lithium One of Canada and Galaxy Resources,
the Company's holding was diluted and is 10.45% as at 30June2012.



Mt Cattlin

Mt. Cattlin production continued throughout the year until July 2012 when
Galaxy announced a temporary halt to production due to the large stockpiles of
ore destined to Jiangsu plant in China which was in its early stages of
ramping up to full production. It is expected that production at Mt. Cattlin
will continue once Jiangsu is near full production.



Jiangsu Lithium Carbonate Project in Jiangsu, PRC.

The Jiangsu Lithium Carbonate plant continues to progress with lithium
carbonate production in August totalling 350 tonnes, (25% of design output),
slightly ahead of the ramp-up schedule according to the Galaxy announcement
in September 2012.



Galaxy announced that August sales totalled 268 tonnes generating revenue in
excess of A$1.6 million (RMB10.5 million) for the month. Galaxy commenced
battery grade lithium carbonate sales with overall product acceptance. August
sales were still based predominantly on technical grade product. Going
forward, battery grade sales revenue is expected to increase as more customer
product qualifications are completed.



Battery grade lithium carbonate samples were sent to over 30 potential
customers in China for product qualification. Product testing continues and
feedback regarding product quality to date has been extremely positive
according to Galaxy.



Product quality at Jiangsu continues to achieve at least the 99.5% purity
criteria required to class the lithium carbonate as battery grade, with the
product meeting all of the prescribed tolerances for impurities required by
Galaxy's cathode producing customers.



Exploration Activities



This section should be read in conjunction with the Subsequent Events note and
in note 33 to the financial statements.



Retention Licences

Creat Resources Holdings Limited ("CRHL") and its wholly owned subsidiary,  ZZ 
Exploration Pty Ltd, hold  three (3) Retention Licences  (RL) as a portion  of 
its tenement  package situated  in  the mineral  rich  area around  Zeehan  in 
Western  Tasmania.  Re-assessment  of  the  existing  mineral  resources  and 
development of programs to increase reserves and/or extract ore grade material
for all three licences  has been ongoing over  the last 12 months.  Selective 
rehabilitation is being completed  at the Comstock  mine site and  surrounding 
works in consultation with the EPA of Tasmania.



Comstock

RL4/2009 Comstock was granted on 01/02/2010 for an initial period of 2  years. 
This term  was extended  for  a further  2 years  and  will expire  on  the1st 
February 2014 unless extended.



Mineral Resources Tasmania (MRT) has  for several years held an  environmental 
bond of $2.5 million from CRHL to cover the decommissioning and rehabilitation
of the Comstock site. Further to this, CRHL will be entitled to reimbursement
in full, of the bond amount, upon successful completion of the decommissioning
and rehabilitation process.



Environmental Protection Notice (EPN) 7977/1 states that CRHL must develop and
implement a Decommissioning  and Rehabilitation  Plan (DRP) for  the site.  A 
draft DRP has been developed by CRHL and has been submitted to the Environment
Protection Authority (EPA) for review. This  was done in September 2011.  The 
current version of the DRP resides with the EPA. The version as it exists  is 
only partially acceptable to the EPA  and CRHL has been informed that  further 
work is required for  resubmission of the DRP  after addressing the issues  of 
concern to the EPA.



Minimal rehabilitation work was completed during the year. A clay deposit was
located and samples  taken for analysis.  The samples were  analysed and  now 
require  review  by  an  environmental  consultant  to  report  on  the   soil 
compatibility for  the purposes  required by  the EPA  in the  capping of  the 
Swansea Waste Rock dump and the now partially infilled dirty water dam.



Quarterly water quality testing continues as well as continuous lime dosing to
maintain water quality control on site  as per our obligations with regard  to 
the site and the EPA.



Oceana

RL3/2009 Oceana was granted on 01/02/2010 for an initial period of 2 years. An
application was made and granted for  an extension of term. This licence  now 
expires on the 1^st February 2014 unless extended.



There has been  no development  activity in  the 12  months to  30 June  2012, 
however, quarterly water quality  control samples continue  to be carried  out 
and assessment of the mineral resource potential continues.



 Mariposa

There has been  no development  activity in  the 12  months to  30 June  2012. 
Retention Licence RL1/2008 was renewed in  February 2011 for a further  period 
of 2  years,  with  the term  of  the  licence extending  until  1st  February 
2013.Continued assessment of  the mineral resource  potential was carried  out 
during the term.



Exploration Licences

CRHL with its wholly owned subsidiary,  ZZ Exploration Pty Ltd holds four  (4) 
current and active  Exploration Licences (EL)  in the Zeehan  area covering  a 
total area  of 109  square kilometres.  Geological work  programs,  including 
drilling were completed on the various tenements during the year ended 30 June
2012.



 EL30

The primary focus at EL30/2002, Tenth Legion Prospect has been to evaluate the
extent and  quality  of the  long-known  magnetite mineralisation  present  to 
determine the suitability as a Direct Shipping Ore (DSO). This work  continues 
and will require  further drilling to  delineate a resource.  Work was  also 
undertaken to  determine  the  continuity  of  strike  from  Comstock  to  the 
southeast of the RL  within EL30 during  the year with  two of three  planned 
diamond drill holes being completed. SY159 & SY160 were drilled to  completion 
during the period. SY159 Intersected one minor mineralised zone at depth  and 
SY160 intersected two minor  mineralised zones. The  results did not  warrant 
the completion of the third diamond hole planned further to the southeast.



Table 1 - Collar Information

Hole No. Easting Northing Azimuth Dip Depth
   SY159  359008  5360418     205 -50 213.6
   SY160  359235  5360354     205 -50 244.6

                                                                             

 EL20



Two further diamond  drill holes, AU002  and AU003 were  completed during  the 
period as  a follow-up  to AUD001  drilled in  the previous  year. AU002  was 
designed to test the continuity of  the mineralised zone confirmed in  AU001. 
AU002 was drilled to the northeast and from the opposite side of the structure
as  AU001.  The  results  confirmed  the  extension  of  a  broad  low  grade 
mineralised zone  from  AU001.  A  fourth diamond  hole,  AU004  was  planned 
approved and awaits drilling.



AU003 was designed  to test a  small historical zone  above AU001. The  drill 
results were disappointing and no further work was completed.



Table 2 - Collar Coordinates

Hole No Easting Northing Azimuth Dip Depth
AU002   362271  5358975  250     -55 349.5
AU003   362036  5358886  250     -45 239.5

 EL18

The geochemical  grid was  sampled  during the  period  and the  samples  were 
subjected to  onsite  handheld  XRF  analysis. Results  were  mixed  with  no 
follow-up work planned in this area at present.



During the period  it was decided  to plan  and carry out  a diamond  drilling 
program in the southeast corner of  the northern block of EL18. This  section 
is due west of Zinc mineralisation located  in the south portion of the  Tenth 
Legion prospect on EL30. Three diamond drill holes were planned of which  one 
has been completed. These drill holes were planned to test the western extent
of the Zinc mineralisation  of previous drilling programs  carried out on  the 
adjacent EL30.



TLC44 was the first of the holes to be drilled and was completed at a depth of
201.9m. TLC43 and TLC45 are prepared, approved and await drilling.



 EL21

The company has committed to reviewing  the existing data relating to the  two 
tin prospects  within  the  tenement.  A  pre-JORC  resource  exists  on  the 
Razorback mine and  work is  ongoing with  regard to  planning and  completing 
further exploration that could lead to an  up grading of the resource to  JORC 
compliance.



Consolidated statement of comprehensive income





                                                    Year Ended    Year Ended
                                                    30-Jun-12     30-Jun-11
                                              Note      $             $
Continuing Operations
Revenue                                        6        275,196       211,627
Other Gains and Losses                         7      (747,241)     (364,768)
Share of Loss of Associate                     14             -   (5,108,536)
Exploration and Evaluation Costs Expensed      8      (325,448)   (1,374,883)
Depreciation Expense                           8      (249,217)     (310,977)
Finance Costs                                  8    (9,693,129)   (6,746,616)
Administration Expenses                               (682,945)     (547,557)
Employee Expenses                                   (1,372,422)   (2,878,924)
Site Operations                                       (105,537)     (117,942)
Site Operations - Environment                         (605,083)   (2,999,835)
Other Expenses                                        (168,155)     (200,678)
Loss before Income tax                             (13,673,981)  (20,439,089)
Income Tax Benefit                             10             -            -
Loss for the Period                                (13,673,981)  (20,439,089)
Other Comprehensive Income
Share of Other Comprehensive Income of
Associate                                                     -       739,166
Other Comprehensive Income for the Period
(Net of Tax)                                                  -             -
Total Comprehensive Income for the Period          (13,673,981)  (19,699,923)
Earnings Per Share
Basic (cents per share)                                  (2.05)        (3.06)
Diluted (cents per share)                                (2.05)        (3.06)



The accompanying notes form part of these financial statements





Consolidated statement of financial position as at 30 June 2012

                                        30 Jun 12       30-Jun-11
                                 Note       $        $
Assets
Current Assets
Cash and Cash Equivalents         24         92,797            263,714
Trade and Other Receivables       11         61,269             28,043
Other Current Assets              12        103,497            126,542
Total Current Assets                        257,563            418,299
Non-Current Assets
Property, Plant and Equipment     16        867,598          1,164,990
Exploration and Evaluation Asset            250,000          250,000
Investment in Associate           14              -                  -
Other Non-Current Assets          15     22,283,595        28,568,712
Other Financial Assets            13      2,500,000          2,500,000
Total Non-Current Assets                 25,901,193         32,483,702
Total Assets                             26,158,756         32,902,001
Liabilities
Current Liabilities
Trade and Other Payables          17        396,857            435,458
Financial Liabilities             18     43,605,795         32,533,017
Provisions                        19      1,279,380          1,450,954
Total Current Liabilities                45,282,032         34,419,429
Non-Current Liabilities
Financial Liabilities             18              -          4,225,628
Provisions                        19      1,610,136          1,316,375
Total Non-Current Liabilities             1,610,136          5,542,003
Total Liabilities                        46,892,168         39,961,432
Net Liabilities                        (20,733,412)        (7,059,431)







                                               30 Jun 12       30-Jun-11
                                        Note       $        $
Equity
Issued Capital                           20     69,408,416         69,408,416
Reserves                                 21        344,531            344,531
Accumulated Losses                            (90,486,359)       (76,812,378)
Equity attributable to owners of the
Company                                       (20,733,412)        (7,059,431)
Total Deficiency                              (20,733,412)        (7,059,431)

The accompanying notes form part of these financial statements





Consolidated statement of cash flows for the year ended 30 June 2012

                                               30-Jun-12       30-Jun-11
                                         Note      $        $
Cash Flows from Operating Activities
Receipts from Customers                            99,369             137,772
Payments to Suppliers and Employees           (3,401,005)         (6,336,365)
Net Cash used in Operating Activities     24  (3,301,636)         (6,198,593)
Cash Flows from Investing Activities
Purchase of Property, Plant & Equipment                 -           (123,693)
Proceeds from Sale of Property, Plant &
Equipment                                         145,427                   -
Interest Received                                 142,601             220,857
Net Cash generated by Investment
Activities                                        288,028              97,164
Cash Flows from Financing Activities
Interest Paid                                     (7,309)           (136,042)
Proceeds from Borrowings                        2,850,000           3,882,666
Repayment of Borrowings                                 -           (378,588)
Net Cash generated by Financing
Activities                                      2,842,691           3,368,036
Net Decrease in Cash and Cash
Equivalents                                     (170,917)         (2,733,393)
Cash and Cash Equivalents at Beginning
of the Period                                     263,714           2,997,107
Cash and Cash Equivalents at the End of
the Period                                24       92,797             263,714



The accompanying notes form part of these financial statements

                   Issued     Accumulated         Share of      Other       Total
                                                 Associate's                        
                  Capital       Losses                        Reserves
                                                   Reserve
                                            
                 $    $          $    $   $
Balance at 1
July 2010        69,408,416  (56,373,289)        462,415      344,531     13,842,073
Loss for the
Period                  -  (20,439,089)             -          -   (20,439,089)
Total
comprehensive
income for the
period                  -  (20,439,089)             -          -   (20,439,089)
Share of
Associate's
Reserves                -           -         739,166            -        739,166
Reclassification
to AFS
Investment                -             -     (1,201,581)            -    (1,201,581)
Balance at 30
June 2011        69,408,416  (76,812,378)              -      344,531    (7,059,431)





                  Issued    Accumulated    Share of      Other       Total
                                          Associate's
                 Capital       Losses                  Reserves
                                            Reserve
                                  
                $   $     $    $  $
Balance at 1
July 2011       69,408,416  (76,812,378)           -    344,531   (7,059,431)
Loss for the
Period                   -  (13,673,981)            -          -  (13,673,981)
Total
comprehensive
income for the
period                   -  (13,673,981)            -          -  (13,673,981)
Balance at 30
June 2012       69,408,416  (90,486,359)            -    344,531  (20,733,412)



The accompanying notes form part of these financial statements





Note 1: General Information



Creat  Resources  Holdings  Limited  (CRHL)  is  a  company  incorporated   in 
Australia. The  address  of  its  registered office  and  principal  place  of 
business is disclosed in  note 32 to the  financial statements. The  principal 
activities of  CRHL and  its subsidiaries  (the 'Consolidated  Entity' or  the 
'Company') during  the  financial  year  were  minerals  exploration  and  the 
acquisition, exploration and operation of mineral properties in Australia.



Going Concern

The financial report has been prepared on a going concern basis, which assumes
continuity of normal business activities and the realisation of assets and the
settlement of liabilities in the ordinary course of business.

The Company is in a development stage and in the course of its activities  has 
sustained operating losses. It expects such  losses to continue for at  least 
the next 12 months. The Company will finance its operations primarily through
cash and cash equivalents on hand, future financing from the issuance of  debt 
or equity instruments and through  the generation of revenues once  commercial 
operations get  underway.  However,  the  Company has  yet  to  generate  any 
significant revenues and has no assurance of future revenues.

Based on the  Company's forecasted  cash flows  through to  31 December  2013, 
further funding of $400,000 is required, of which there is a further  $150,000 
available in a  facility with  the Company's  parent entity,  Creat Group.  As 
disclosed in note 33, the Company has entered into an agreement to dispose  of 
all the existing mining assets currently  held in Tasmania, together with  all 
associated plant and equipment, for a total consideration of AUD $4million  in 
cash.

The following plan  is in  place by Management  to support  the going  concern 
basis of the Company and the consolidated entity.

On 31 October  2012 the Company  received an undertaking  from Creat Group  in 
that, for  the purposes  of assisting  the company  in achieving  its  working 
capital forecast to 31 December 2013:

· Creat Group will continue to provide further funding to CRHL as required
with interest rates to be charged based on market interest rates; and



· Creat  Group will  not  call for  or cause  repayment  of any  loans  or 
convertible notes, including the payment of accrued interest on such loans  or 
convertible  notes,  held  by  Creat  Group   at  30  June  2012  or   entered 
into/acquired by Creat Group subsequent to  that date, and interest that  will 
be due and payable on such loans  or convertible notes through to 31  December 
2013.



At the  date of  this report  and  having considered  the above  factors,  the 
directors are confident that the Company  and the consolidated entity will  be 
able to continue as going concerns.



Note 2: New Accounting Standards for Application in Future Periods



The AASB  has issued  a number  of new  and amended  Accounting Standards  and 
Interpretations that  have mandatory  application dates  for future  reporting 
periods,  some  of  which  are  relevant  to  the  Consolidated  Entity.   The 
Consolidated Entity has decided not to early adopt any of the new and  amended 
pronouncements. The new and  amended pronouncements that  are relevant to  the 
Consolidated Entity and  applicable in  future reporting periods  are set  out 
below:









Note 2: Adoption of new and revised Accounting Standards (cont).



Standard/Interpretation                    Effective for     Expected to be
                                           annual reporting  initially applied
                                           periods beginning in the financial
                                           on or after       year ending
AASB 2011-9 Amendments to Australian          1 July 2012      30 June 2013
Accounting Standards - Presentation of
Items of Other Comprehensive Income
AASB 2011-4 Amendments to Australian          1 July 2013      30 June 2014
Accounting Standards to Remove Individual
Key Management Personnel Disclosure
Requirements
AASB 9 Financial Instruments                1 January 2015     30 June 2016
AASB 10 Consolidated Financial Statements  1 January 2013     30 June 2013
AASB 11 Joint Arrangements                 1 January 2013     30 June 2013
AASB 12 Disclosure of Interests in Other   1 January 2013     30 June 2013
Entities
AASB 13 Fair Value Measurement, AASB       1 January 2013     30 June 2013
2011-8 Amendments to Australian Accounting
Standards arising from AASB 13
AASB 119 Employee Benefits                  1 January 2013     30 June 2013
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