From the FT on the 19th June

http://search.ft.com/search/article.html?id=040619001094&query=kenmare&vsc_appId=totalSearch&state=Form

COMPANIES UK & IRELAND: Kenmare negotiates $269m loan
By John Murray Brown
Financial Times; Jun 19, 2004



One of the largest debt financings for an independent mining company was announced yesterday when Kenmare Resources agreed a $269m (146.5m) facility to develop the Moma titanium mine in Mozambique.

Drawdown of the debt is contingent on the Irish company raising equity of $79m, lifting the value of the project to $345m.

The company already has commitments of $55m from a number of large investment funds.

Documents will be posted to shareholders on Monday for an open offer to raise up to $42m.

A banker at NM Rothschild, lead advisers on the financing, said the debt package represented three times Kenmare's market capitalisation of $90m.

"I do not think there have been any listed mining companies who have done that," he said.

Among the lenders, the African Development Bank is lending $40m and the European Investment Bank $15m in senior debt and a $40m subordinated loan, reflecting the vital economic benefits to what is the poorest region of one of Africa's poorest countries.

Martin Curwen, of the EIB, said this was the first deal signed under the 2000 Cotonou agreement between the EU and African, Caribbean and Pacific countries.

He said EIB's presence would "provide comfort" to other lenders. "It is part of our mandate to support projects where the funding would not have been available from the financial markets," he said at yesterday's signing ceremony, attended by Castigo Langa, Mozambique's minister of mineral resources and energy.

KFW, the German development finance institution, is providing $50m, partly tied to the supply of electrical equipment by Siemens.

The Dutch development agency FMO is lending $15m. The only commercial bank involved is ABSA, the South African bank, which is lending $80m to support the purchase of South African goods and services by the mine.

The mine is expected to be in production in the second half of 2006, with annual output of 600,000 tonnes of ilmenite and other titanium minerals that supplies white pigment used in paint and toothpaste.

The company has already raised 4m to purchase a mineral separation plant in Western Australia, which is being dismantled and shipped to the site.

At full production, the mine will account for about 5 per cent of world supply. About two-thirds of world production is controlled by RTZ and Iluka, an Australian company spun out of the old Rennison Goldfields.

FT Comment

* There have been similar financings in the minerals sector but never where the borrowing is three times the borrower's market valuation. The Lihir gold project in Papua New Guinea raised $300m in 1995 but lenders had the comfort that Rio Tinto Zinc owned about 40 per cent of the company. Kenmare's project is 100 per cent-owned by Kenmare, a company that has no cash flow and would have reported a small loss of $40,000 last year but for interest on its bank deposits. This project clearly could transform its fortunes. There are offtake agreements in place for more than half the first five years' production with Dupont and Mitsui. Prices for mineral sands tend to be more stable than base metals, which behave more like a commodity dependent on capital goods demand. The current market cap is little more than the value of a year's production from the mine. An upgrade seems inevitable. Canaccord, the company's broker, has a current price target of 35p. This compares with a close of 17p, down 2p yesterday.


Copyright The Financial Times Ltd

welcome abroad Andy....We did have PDX in common and if you are still holding well done.
Di

Being a Johnny-come-lately at 25p earlier this year, I'm very happy to hold another year till production gets going (or a takeover).

What is our target price for September 2006?

sd

capa

my thoughts exactly - I have held KMR for 3 years and will continue to do so - given that their commodity is in short supply I would be amazed if one of the big boys didn't come in either as a takeover or to take a share in the project to further develop the mine. Time will tell.

The Times reports Rio Tinto's anger at the foreign office pulling out its embassy in Madagascar, just as it is investing in a 421million TiO2 (titanium oxide) project.

With Madagascar separated from Mozambique only by effectively the Rift Valley, the geology is probably the same (part of old Gondwanaland before America drifted away from Europe). Looks like KMR have company fromone of hte hbig boys.

Who was talking about takeovers or jv's to accelerate development for KMR?

Also Jubilee Platinum just announced a big doscover on the island.

sd

Interesting snippet from Monday's trader's thread press round up

"Express
MARKET REPORT: KENMARE RESOURCES (rumours that a tie-up with mining giant RIO TINTO was on the cards)"

was it something I said?!

Well done SD ...I was just about to post about Rio and KMR but see you have beaten me to it!!

Don't worry about valuations in September 2006 as the company will not exist then. It will be taken out by a major after a long bidding war between 3 majors during the months of October to January.

LDettori - With a name like yours, not suprising you recognise a 3-horse race when you see one - lol!

sd

Michael Carville said last summer in an interview with Tom Winnifrith that the company had been approached by other companies. With the excellent progress already made, most of the difficult work has been done, it is not so difficult to be of the opinion that KMR is on the radar of all the majors in the industry. There is no way that they will want a new entrant to their lucrative market with an initial 8% market share and a possible 25% market share depending on capacity expansion. At current prices KMR is a steal. If they get to production, and I hope they do, KMR will be a billion pound company.
Question 1 - When is production forecast to start?
Question 2 - What is KMR's current Valuation?
Question 3 - Can you do the math?

I can do the math and I have been saying the same thing for some time, especially when you consider that KMR's project is surface mining and considered as "low cost".

A very positive statement from KMR;

Kenmare Resources PLC
21 September 2005


Kenmare Resources plc ('Kenmare' or 'the Company')


Kenmare Interim Results

For the period ended 30th June 2005

Chairman's Statement

Dear Shareholder,

Implementation of Kenmare's Moma Titanium Minerals Project continues apace with
41% completion already being achieved. Commissioning is on track for the fourth
quarter of 2006. Most of the steelwork and process components have arrived
safely on site from Western Australia and assembly is due to commence this
month. Bulk earthworks and civilworks are nearing completion. Construction of
the permanent accommodation village has progressed well and it will soon be
ready to receive a large influx of construction workers to erect the plants,
jetty and other facilities. Recruitment and the placement of major supply
contracts for the operations phase are well underway.

The market outlook for titanium minerals continues to be positive, driven by
strong pigment demand most notably in China. Industry analysts forecast
tightness in the ilmenite market to continue for the coming years. This has led
to a firming of ilmenite prices, which is set to continue as limited new
supplies are scheduled to enter the market and Moma is well placed to capitalise
on the positive demand outlook. Negotiations are ongoing with a number of
customers for the balance of Moma's ilmenite production. Demand for zircon
continues to be very strong and prices have increased to circa US$700 per metric
tonne for premium grade. This compares to our financing which was based on
approximately US$500 per metric tonne. The outlook is for zircon supply to
remain tight for the foreseeable future. Kenmare has contracted a significant
volume of its zircon to date at market-based prices, ensuring that we benefit
from the continuing strong market conditions.

Kenmare has commenced in-fill drilling of the dredge path and recent results
have met with expectations. When this programme is completed we plan to
investigate more extensively the resource potential beyond the immediate mining
area.

The Moma Development Association continues to work with Non-Governmental
Organisations (NGOs) to set up initiatives to ensure the local community will
benefit from the project. These initiatives include skills and agricultural
training, promotion of spin-off businesses and health awareness. The Association
has engaged a development consultant to further advance a number of projects.

During the six months ended 30th June 2005 we report a profit of US$3,750,033.
This profit arises primarily from foreign exchange gains on Euro-denominated
debt and deposit interest earned net of Kenmare's corporate operating costs. In
the six months, investment in Deferred Development Expenditure and Construction
at Moma increased by US$84,411,649 to US$220,056,203 and bank loans increased by
US$64,548,488 to US$119,522,623. Cash and bank balances at the 30th June
amounted to US$80,527,088.

We will continue to focus on the successful management of the construction
process and look forward to the challenges ahead as we move to production.

Charles Carvill

Chairman

21st September 2005


For more information:

Kenmare Resources plc

Michael Carvill, Managing Director

Tel: + 353 1 671 0411

Mob: + 353 87 674 0110




Conduit PR Ltd

Leesa Peters

Tel: +44 (0) 207 618 8708

Mob: + 44 (0) 781 215 9885

Murray Consultants Ltd

Aoibheann O'Sullivan

Tel: + 353 1 498 0346

Mob: +353 87 629 1453


www.kenmareresources.com







INDEPENDENT AUDITORS' REVIEW REPORT

TO THE BOARD OF DIRECTORS OF KENMARE RESOURCES PLC

Interim Financial Information - Six months ended 30th June 2005


Introduction

We have been instructed by the Company to review the financial information for
the six months ended 30th June 2005 which comprises the Consolidated Income
Statement, the Consolidated Balance Sheet, the Group Cash Flow Statement, and
related notes 1 to 9. We have read the other information contained in the
interim report and considered whether it contains any apparent misstatements or
material inconsistencies with the financial information.

This report is made solely to the Company in accordance with Bulletin 1999/4 '
Review of Interim Financial Information' issued by the Auditing Practices Board.
Our work has been undertaken so that we might state to the Company those matters
we are required to state to them in an independent review report and for no
other purpose. To the fullest extent permitted by law, we do not accept or
assume responsibility to anyone other than the Company for our review work, for
this report or for the conclusions we have reached.

Directors' responsibilities

The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the Directors. The Directors
are responsible for preparing the interim report in accordance with the Listing
Rules of the Irish Stock Exchange and of the UK Financial Services Authority
which require that the accounting policies and presentation applied to the
interim figures are consistent with those applied in preparing the preceding
annual accounts except where any changes, and the reasons for them, are
disclosed.

International Financial Reporting Standards

As disclosed in note 1, the next annual financial statements of the Group will
be prepared in accordance with International Financial Reporting Standards as
adopted for use in the EU. Accordingly, the interim report has been prepared in
accordance with the recognition and measurement criteria of IFRS and the
disclosure requirements of the Listing Rules. The accounting policies are
consistent with those that the Directors intend to use in the annual financial
statements.

Review work performed

We conducted our review in accordance with guidance contained in Bulletin 1999/4
issued by the Auditing Practices Board for use in the United Kingdom and
Ireland. A review consists principally of making enquiries of management and
applying analytical procedures to the financial information and underlying
financial data and based thereon, assessing whether the accounting policies and
presentation have been consistently applied unless otherwise disclosed. A review
excludes audit procedures such as tests of controls and verification of assets,
liabilities and transactions. It is substantially less in scope than an audit
performed in accordance with International Statements on Auditing (UK and
Ireland) and therefore provides a lower level of assurance than an audit.
Accordingly, we do not express an audit opinion on the financial information.

Review conclusion

On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 30th June 2005.

Deloitte & Touche

Chartered Accountants and Registered Auditors

Deloitte & Touche House

Earlsfort Terrace

Dublin 2

21st September 2005





KENMARE RESOURCES PLC

CONSOLIDATED INCOME STATEMENT

FOR THE SIX MONTHS ENDED 30th JUNE 2005


6 Months 6 Months 12 Months
30/06/2005 30/06/2004 31/12/2004
Unaudited Unaudited Audited
US$ US$ US$
Revenue - - -
Operating Gains/(Expenses) 2,852,596 46,750 (588,330)

Operating Profit/(Loss) 2,852,596 46,750 (588,330)

Interest Receivable 897,437 25,130 611,625

Profit on Ordinary Activities
Before Taxation 3,750,033 71,880 23,295

Taxation - - -

Profit On Ordinary Activities
After Taxation 3,750,033 71,880 23,295

Earnings per share: Basic 0.58c 0.03c 0.01c

Earnings per share: Diluted 0.48c 0.02c 0.01c



KENMARE RESOURCES PLC

CONSOLIDATED BALANCE SHEET

AS AT 30 th JUNE 2005


6 Months 6 Months 12 Months
30/06/2005 30/06/2004 31/12/2004
Unaudited Unaudited Audited
US$ US$ US$
ASSETS
Non-Current Assets
Deferred Development Expenditure 91,730,552 42,074,660 61,661,793
Construction in Progress 86,711,581 - 32,368,691
Property, Plant and Equipment 41,614,070 41,618,255 41,614,070

220,056,203 83,692,915 135,644,554
Current Assets
Debtors 7,769,835 751,985 1,557,260
Cash at Bank and In Hand 80,527,088 538,203 92,851,383

88,296,923 1,290,188 94,408,643

Total Assets 308,353,126 84,983,103 230,053,197

EQUITY
Capital and reserves attributable to the Company's equity holders
Called Up Share Capital 53,426,440 26,327,993 52,923,239
Share Premium Account 100,986,877 29,916,845 99,589,865
Profit and Loss Account - (Deficit) (18,122,666) (21,824,113) (21,872,698)
Share Options Reserve 1,836,045 42,659 175,259
Revaluation Reserve 30,141,002 30,141,002 30,141,002
Other Reserve 3,642,080 3,642,080 3,642,080
Capital Conversion Reserve Fund 754,191 754,191 754,191

Total Equity 172,663,969 69,000,657 165,352,938

LIABILITIES
Non-current Liabilities
Bank loans 119,522,623 - 54,974,135
Accruals and other loans 5,780,738 1,502,582 1,568,202

125,303,361 1,502,582 56,542,337
Current Liabilities
Accruals 10,385,796 14,479,864 8,157,922

Total Liabilities 135,689,157 15,982,446 64,700,259

Total equity and liabilities 308,353,126 84,983,103 230,053,197




KENMARE RESOURCES PLC

GROUP CASH FLOW STATEMENT

FOR THE SIX MONTHS ENDED 30 th JUNE 2005

6 Months 6 Months 12 Months
30/06/2005 30/06/2004 31/12/2004
Unaudited Unaudited Audited
US$ US$ US$
Operating activities
Profit/(loss) for the period 2,852,596 46,750 (588,330)
Adjustment for:
Depreciation - 4,185 8,370
Foreign exchange movement 2,048,758 (36,440) 2,992,062
Share-based payment expense 166,079 - 13,260

Operating cashflows before movements In working capital 5,067,433 14,495 2,425,362

(Increase) in debtors (6,212,575) (661,663) (1,466,938)
Increase in accruals 6,475,864 11,254,957 5,042,638

Net cash from operating activities 5,330,722 10,607,789 6,001,062

Investing activities
Interest received 897,437 25,130 611,624
Addition of Deferred Development Expenditure (30,068,759) (14,605,104) (34,192,237)
Addition of Construction in Progress (54,342,890) - (32,368,691)

Net cash used in investing activities (83,514,212) (14,579,974) (65,949,304)

Financing activities
Issue of Ordinary Share Capital 1,903,230 127,037 105,644,318
Cost of share issue (3,018) - (9,249,015)
Share option reserve 1,494,707 - 119,340
(Decrease) in debt due within one year - - (109,622)
Increase/(decrease) in debt due beyond a year 64,513,034 (227,579) 54,812,176

Net cash from financing activities 67,907,953 (100,542) 151,217,197

Net (decrease)/increase
in cash and cash equivalents (10,275,537) (4,072,727) 91,268,995

Cash and cash equivalents at beginning of period 92,851,383 4,574,490 4,574,490

Effect of foreign exchange rate changes (2,048,758) 36,440 (2,992,062)

Cash and cash equivalents at end of period 80,527,088 538,203 92,851,383





KENMARE RESOURCES PLC

NOTES TO THE INTERIM FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 30th JUNE 2005

1. Basis of Preparation of the Interim Financial Statements

In the current year, the Group has adopted all of the new and revised Standards
and Interpretations issued by the International Accounting Standards Board
(IASB) and the International Financial Reporting Interpretations Committee
(IFRIC) of the IASB that are relevant to its operations and effective for
accounting period beginning on the 1st January 2005. The adoption of these new
Standards and revised Standards and Interpretations has resulted in changes to
the Group's accounting policies set out on page 24 of the 2004 Annual Report and
Accounts for Share-based Payments (IFRS 2) and Property, Plant and Equipment
(IAS 16). The adoption of IFRS 2 has affected the amounts reported for the
current and prior years and details of this are set out in Note 2.

The unaudited interim financial information in this statement has been reviewed
by the auditors in respect of the six months ended the 30th June 2005 only and
their Report to the Directors is set out on page 3.

2. Share-based payments

IFRS 2 Share-based Payment requires the recognition of share-based payments,
which in the case of the Group are share options, at fair value at the date of
grant. Prior to the adoption of IFRS 2, the Group did not recognise the
financial effect of share-based payments until such payments were settled.

In accordance with the transitional provisions of IFRS 2, the Standard has been
applied retrospectively to all grants of share options after the 7th November
2002 that were unvested as of 1st January 2005.

The fair value of the share entitlements to be expensed is determined by using a
Black-Scholes option pricing model. The following inputs were used in
determining the fair value of share entitlements:

The exercise price which is the market price at the date that share
entitlements were granted.

Future price volatility was based on historical volatility as a guide and
is assessed over one year.

A risk free interest rate.

For the year ended the 31st December 2004, the change in accounting policy has
resulted in a decrease in profit for the year of US$13,260 (2003:US$4,266). The
Balance Sheet at 31st December 2004 has been restated to reflect share-based
payment capitalised of US$119,340 (2003:US$38,393) and the share option reserve
movement amounted to US$132,600 (2003: US$42,659).

For the period ended the 30th June 2005, the share-based payment expense was
US$166,079 and the share-based payment capitalised was US$1,494,707, resulting
in a movement in the share option reserve for the period of US$1,660,786.

3. Earnings and Fully Diluted Earnings per Share

The calculation of the earnings and fully diluted earnings per share is based on
the profit after taxation of US$3,750,033 (2004: US$71,880) and the weighted
average number of shares in issue during the six months ended the 30th June 2005
of 649,779,786 shares (2004: 288,212,873 shares).

The calculation of fully diluted earnings per share for 2005 is based on the
profit for the period after taxation as for basic earnings per share. The number
of shares is adjusted to show the potential dilution if share options and share
warrants are converted into ordinary shares. This increases the weighted average
number of shares in issue to 787,759,271.

4. Deferred Development Expenditure

The recovery of deferred development expenditure is dependent upon the
successful development of the Moma Titanium Minerals Project, Mozambique, which
in turn is dependent on the continued availability of adequate funding for the
Project. The Directors are satisfied that deferred expenditure is worth not less
than cost less any amounts written off and that the exploration projects have
the potential to achieve mine production and positive cash flows. Additions
include interest capitalised of US$2,699,400 (2004: US$nil).

5. Construction in Progress

Construction in Progress represents expenditure under a fixed price contract for
the engineering, procurement, building, commissioning and transfer of facilities
at the Moma Titanium Minerals Project in Mozambique. This contract was entered
into on the 7th April 2004. The Contractor is a joint venture formed for this
project, between Multiplex Ltd and Bateman B.V. Multiplex is a large contracting
group based in Australia with operations stretching around the globe and
specialises in large complex construction projects. Bateman is an international
engineering group with specific mineral sands experience and experience of
working in Mozambique.

The recovery of Construction in Progress is dependent upon the successful
development of the Moma Titanium Minerals Project, which in turn is dependent on
the continued availability of adequate funding for the Project.

6. Property, Plant and Equipment

Property, Plant and Equipment comprise of a Processing and Mining Plant. GRD
Minproc Limited, an independent Australian engineering group, appraised the
mining and processing plant on a depreciated replacement cost basis of valuation
as at 30th June 2000 and the Plant was held at this valuation in the accounts to
31st December 2004.

Confirmation of the existence of the Processing and Mining Plant at the year end
was provided by C.R. Cox & Associates (Australia), a firm of marine consultants
and surveyors.

Under the transition to IFRS, the Group has elected to use the above valuation
as the deemed cost as and from the 1st January 2005.

The recovery of this amount is dependent upon the successful development of the
Moma Titanium Minerals Project, which in turn is dependent on the continued
availability of adequate funding for the Project.

7. Reconciliation of changes in Equity

6 Months 6 Months 12 Months
30/06/2005 30/06/2004 31/12/2004
Unaudited Unaudited Audited
US$ US$ US$
Balance at the beginning of the period 165,352,938 68,801,740 68,801,740
Issue of Shares - at par 503,201 58,454 26,653,700
Share Premium, net of costs 1,397,012 68,583 69,741,603
Employee share based compensation 1,660,785 - 132,600
Profit for the period 3,750,033 71,880 23,295
Closing Shareholders' funds 172,663,969 69,000,657 165,352,938


8. Non-Consolidation of Subsidiary Undertaking

As set out in detail in Note 28 of the 2004 Annual Report, Grafites de Ancuabe,
S.A.R.L., a subsidiary company, has been excluded from consolidation from 31st
December 1999.

9. Approval of Interim Financial Statements

The interim financial statements were approved by the Board on the 21 st
September 2005.


21 September, 2005

Looking good, Dynamite
May be the usual post-results profit taking - chart says we could retrace to 32.5p from the recent double top - time to top up, if true, as the risk in this share dimishes with each report we get.
sd

I think SD we had the profit taking last week and that the price with hold up. I can't buy anymore anyway as I am all tied up with NML :-( (it will take off eventually) GFM and NOP. These are my main holdings plus KMR of course. I am overweight KMR and GFM already although partly due to the high rise in prices and profits now in them.
Di

I'm a little underweight in KMR so I will be looking for opportunities to add.

I wouldn't look too long - there may be some small pullbacks but everything I read about KMR is positive and I think that the SP is going to continue slowly nudging higher, especially as it sinks in that commodity prices are significantly higher than forecast during the fundraising.

www.kenmareresources.com/moma/careers.asp

Senior management positions are now being sought by Kenmare, varying starting times of the year from January 2006.

Bit more volume today, is it sector ?

?????????? no just company with excellent prospects. They havent even built the plant yet!! I got in at 14p and expecting it to a lot higher, but some offshoot agreement to get it going again. When they start producing this could fly, have you the patience???

Latest Kenmare Newsletter

Grot, thats old news its dated the 15th october, read Tom Bulford at RHPS for the latest news.