COMMENTARY TO THE SUMMARISED GROUP FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2017 AND NOTICE OF ANNUAL GENERAL MEETING
The board of R&E is pleased to announce the audited results for the year ended 31 December 2017. Mr Van Zyl Botha CA(SA),
Financial Director, is responsible for the annual financial statements and these summarised annual results and has supervised
the preparation thereof in conjunction with Mrs Mandrie Steyn CA(SA) (Group Financial Manager).
The 2017 group results reflected a total comprehensive loss for the year of R7.0 million (2016: R7.9 million).
This was mainly as a result of an increase in legal fees. During the year income was derived primarily from third party recoveries
of R1.1 million (2016: R6.4 million), the sale of prospecting rights realising a profit of R9.1 million and interest of R13.0 million
(2016: R13.7 million) earned on cash investments. The company spent R6.7 million (2016: R6.4 million) on personnel costs, R22.4 million
(2016: R18.3 million) on legal and forensic fees, and other operational costs totalled R2.1 million (2016: R4.8 million).
R&E is liquid with no interest-bearing debt. R&E’s total assets consist primarily of cash and cash equivalents. R&E had a net asset value
per share of R2.13 at 31 December 2017. (2016: R2.23)
R&E started the year under review with a cash and cash equivalent balance of R170.0 million. The group’s cash outflow of R9.9 million was
the net result of interest earned on cash, the disposal of prospecting rights and recoveries received, less cash utilised to fund its
operations during the year. R&E remains in a healthy cash position with R160.1 million in cash and cash equivalents at 31 December 2017.
The outlook for 2018 is largely dependent on the progress and outcome of current legal matters. Expenditure on litigation is expected to be
at a similar level as 2017. Until the claims in which the company are engaged have been finalised, this pattern of expenditure is likely
23 March 2018