Hemscott News Alert - Firestone Diamonds PLC

Firestone Diamonds - Preliminary Results


RNS Number:1186K
Firestone Diamonds PLC
18 December 2007

Firestone Diamonds plc
Preliminary unaudited results
for the year ended 30 June, 2007


LONDON: 18 December, 2007


The Board of Firestone Diamonds plc, ('Firestone' or 'the Company'), the
AIM-quoted diamond mining and exploration company (ticker: AIM:FDI), announces
preliminary audited results for the year ended 30 June, 2007.


HIGHLIGHTS

Botswana

* Prospecting licences granted over the Tsabong kimberlite field and
BK11 kimberlite

* 13 kimberlites discovered at Tsabong

* Number of kimberlites in license areas increased to 92; number of
diamondiferous kimberlites increased to 23

* Bulk sample plant being commissioned, with 25-30 bulk samples to be
taken in 2008

* New prospecting licences covering 4,000 square kilometres granted in
Orapa and Jwaneng areas since year end


South Africa

* Full production reached at Bonte Koe toll treatment mining JV with
De Beers

* Bonte Koe expected to produce lb3.5m revenue and lb2m operating profit
in current financial year


Financial

* Turnover increased 173% to lb1.6m (2006: lb0.6m)

* Profit of lb100k (2006: lb200k loss)

* Profit of lb2 million on disposal of interest in African Diamonds plc
after the end of the financial year


Outlook

* Potential for significant economic kimberlite discovery in Botswana
given high number of diamondiferous kimberlites in portfolio

* Further expansion at Bonte Koe being evaluated

* Pursuing new projects in Botswana


Speaking today, Philip Kenny, Chief Executive of Firestone, said 'Botswana is
the world's largest and lowest cost producer of diamonds, and Firestone has
assembled a dominant land position in Botswana's diamondiferous kimberlite
fields, containing 92 known kimberlites. With bulk sampling of our most
prospective kimberlites to start in January and continue through the year, we
expect 2008 to be an exciting year and to make significant progress towards
identifying the economic potential of our ground holdings.'


For further information, visit the Company's web site at
www.firestonediamonds.com, or contact:


Philip Kenny, Firestone Diamonds +44 20 8834 1028/+44 7831 324 645

Jos Simson, Conduit PR +44 20 7429 6603/+44 7899 870 450

Mike Jones/Ryan Gaffney, Canaccord Adams (Joint Broker) +44 020 7050 6500

Jamie Cumming, Brewin Dolphin (Joint Broker) +44 141 314 8103/+44 7768 044 620

Ken Fleming, Brewin Dolphin (Nominated Adviser) +44 141 221 7733/+44 7971 835 070


Dear Shareholder,

The past year has seen continued good progress in Firestone's growth and
development. Activities were primarily focused on Botswana, where a number of
significant additions were made to the Company's kimberlite project portfolio.


Botswana

Tsabong

The most significant development during the financial year was the granting in
October 2006 of licences over 5,000 square kilometres covering the entire
Tsabong kimberlite field. Tsabong is one of the largest diamondiferous
kimberlite fields in the world and includes the 180 hectare MK1 kimberlite,
which is one of the largest known diamondiferous kimberlites. When we applied
for these licenses we believed that the potential for an economic discovery was
good, as the field is located in the same geological setting as the major Orapa
and Jwaneng mines and none of the Tsabong kimberlites had ever been evaluated on
an adequate scale or with modern techniques. Positive results from work carried
out over the past year have strengthened this belief.

Our primary focus at Tsabong has been to identify and evaluate the kimberlites
in the field with the best economic potential as rapidly as possible.
Approximately 5,300 metres of percussion drilling and 2,800 metres of core
drilling have been carried out, and extensive laboratory and kimberlitic
indicator mineral ('KIM') chemistry analysis undertaken. Based on the results
of this work, 14 high priority kimberlites have been selected for large diameter
drill ('LDD') bulk sampling in 2008. MK1 and MK31 are the most significant of
these as they are already proven to contain microdiamonds, have good KIM
chemistry and are very large, at 180 and 75 hectares, respectively.

A ten tonne per hour bulk sampling plant has been constructed and is currently
being commissioned at Tsabong. The bulk sampling plant will be the only sample
treatment facility in Botswana outside De Beers and will be a key asset for the
Company, as material will be processed rapidly and without the risk of delays
from commercial laboratories or contractors. The first bulk sample material is
expected to be processed early next year.

There is significant potential for the discovery of new kimberlites at Tsabong.
Excellent progress has been made and we are pleased to announce the discovery of
two additional kimberlites, bringing the total discovered in the past year to 13
and the total number of known kimberlites in the field to 83. Microdiamond, KIM
chemistry and petrographic analysis are currently under way, on the basis of
which some of the kimberlites may be added to the high priority list for bulk
sampling. With many more geophysical targets to drill, the Company expects to
continue to make new discoveries and the number of kimberlites in the field to
increase to more than 100 as exploration continues in 2008.


BK11

In March 2007, the Company was awarded a prospecting licence for the BK11
kimberlite, from which previous evaluation work produced grades of up to 16
carats per hundred tonnes. BK11 is situated approximately 20 kilometres south
east of Debswana's Orapa Mine and 5 kilometres north east of the AK6 kimberlite,
on which De Beers and African Diamonds are developing a new mine. BK11 is
estimated to be approximately 8 hectares in size and overburden is shallow, at
less than 20 metres. With its location close to the infrastructure around the
mines in the Orapa region, the grade required for BK11 to be economically viable
is expected to be modest.

Detailed ground geophysical surveys and approximately 3,000 metres of core
drilling have been carried out, from which a detailed 3D geological model of the
kimberlite has been developed. LDD bulk sampling will be carried out in early
2008 in order to establish a representative grade for the kimberlite and to
recover sufficient macro diamonds to provide an estimate of the diamond value.
Subject to the results of this work, additional LDD sampling and resource
delineation work will be undertaken in 2008.


Orapa and Jwaneng

Continued progress was made in the Jwaneng and Orapa areas, where the Company is
the largest holder of diamond exploration rights around the Jwaneng and Orapa
mines. Some of these areas are being explored by De Beers in joint venture with
Firestone.

De Beers undertook high resolution airborne geophysical surveys over
approximately 50% of the Jwaneng joint venture area during the year. These
surveys are expected to be completed in 2008, following which drilling of
targets will take place. De Beers undertook a number of additional geophysical
and geochemical surveys in the Orapa joint venture area during the year, and
further exploration drilling is planned in 2008.

The Company also announces that it has been granted new prospecting licences
over an area of approximately 1,000 square kilometres in the Orapa region and
approximately 3,000 square kilometres in the Jwaneng region. These new licences
increase Firestone's position as the largest holder of diamond exploration
rights in Botswana's kimberlite fields, with approximately 26,000 square
kilometres now under license. Exploration on these areas will be carried out by
Firestone, and work is expected to commence in 2008.


South Africa

Activities in South Africa were primarily focused on the Company's toll
treatment joint venture project with De Beers at the Bonte Koe Mine. Processing
of material for De Beers commenced at the start of the year and continued while
work was being undertaken to expand the capacity of the plant. The expansion
was completed in the second half of the financial year and the plant is now
operating at its full design capacity of one million tonnes per annum. This
project is very significant for Firestone, as it provides the Company with
assured revenue and cash flow for the six year duration of the project.
Discussions are currently under way in relation to further increases in
production capacity in order to exploit additional De Beers' resources in the
area.

Limited work was undertaken at Firestone's other alluvial mining and exploration
projects in South Africa during the year. With Botswana being the primary focus
for the Company's exploration activities and with the Bonte Koe operation in
South Africa now in full production, the Company intends to focus its future
activities in South Africa on low risk toll treatment and joint venture mining
opportunities. As a result, the Company has decided to sell or joint venture
its other assets in South Africa at the Oena Mine, the Avontuur Mine and the
Groen River Valley and has agreed to terminate its joint venture with De Beers
at the Groen River Valley.


Financial

Turnover for the year increased 173% to lb1.6 million, principally as a result of
the commencement of the toll treatment project at Bonte Koe. The Company
produced a profit for the year of lb100,000. Revenue for the current financial
year is expected to continue to rise significantly, with Bonte Koe contributing
at full capacity for the whole year. The Company disposed of its interest in
African Diamonds plc after the end of the financial year, generating a profit of
over lb2 million, and intends to use the proceeds to accelerate exploration and
evaluation work at Tsabong and BK11.


Outlook

Botswana is the world's largest and lowest cost producer of diamonds and we
believe that it is likely that further major economic discoveries will be made
there. With 92 known kimberlites in our licence areas, the likelihood of more
discoveries being made in 2008, and positive results received from work carried
out over the past year, we believe that Firestone has a very good chance of
making such a discovery. We intend to substantially increase the pace of our
activities in Botswana. We plan to process between twenty five and thirty 100

tonne mini bulk samples in 2008, which will allow us to make significant
progress towards identifying the economic potential of our kimberlites by the
end of the year.

Firestone has made considerable progress over the past year and we are
increasingly confident about the Company's long term prospects. With a highly
prospective portfolio in Botswana, the financial resources to develop the
portfolio and a very experienced technical and management team in place, we
believe that we are well placed to take advantage of what we expect will be
several years of rising prices in the rough diamond market.

Finally, I would like to record the Board's appreciation of the continued
dedication and commitment of our senior management and staff, who have
contributed to the Company's continued growth and development over the past
year.


James F. Kenny
Chairman

17 December 2007


FIRESTONE DIAMONDS PLC
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 30 JUNE 2007

2007 2006
As restated
lb lb

------------ ------------

Turnover 1,633,393 598,290

Change in stocks of finished goods 85,109 (41,007)
and in work in progress
------------ ------------

Raw materials and consumables (274,143) (189,813)
Staff costs (319,990) (165,637)
Depreciation and amortisation (536,105) (184,557)
Other operating charges (664,353) (588,250)


Operating (loss) (76,089) (570,974)

Interest receivable and similar income 280,834 209,983
Interest payable and similar charges (134,335) (136,963)


Profit/(loss) on ordinary activities before taxation 70,410 (497,954)

Deferred tax on profit/(loss) on ordinary activities (35,730) 158,497


Profit/(loss) on ordinary activities after taxation 34,680 (339,457)

Minority interests 20,323 144,859


Profit/(loss) for the year 55,003 (194,598)

Earnings/(loss) per share
Basic profit/(loss) per share 0.1p (0.4)p
Diluted profit/(loss) per share 0.1p (0.4)p

Turnover is wholly derived from continuing activities.


CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
FOR THE YEAR ENDED 30 JUNE 2007


lb lb
As restated

Profit/(loss) for the financial year 55,003 (194,598)
Currency translation differences (1,799,559) (1,521,627)
Deferred tax on exchange differences (308,755) 279,173


Total recognised gains and losses for the year (2,053,311) (1,437,052)


FIRESTONE DIAMONDS PLC
CONSOLIDATED BALANCE SHEET
30 JUNE 2007


2007 2006
As restated

lb lb lb lb
FIXED ASSETS
Intangible assets 11,404,238 9,149,294
Tangible assets 12,568,132 11,255,607
Investments 3,078,550 3,078,550


27,050,920 23,483,451
CURRENT ASSETS
Stocks 275,508 64,570
Debtors 2,510,435 1,886,790
Cash at bank and in hand 1,118,790 4,750,506


3,904,733 6,701,866
CREDITORS
Amounts falling due within
one year (2,064,097) (940,193)


NET CURRENT ASSETS 1,840,636 5,761,673


TOTAL ASSETS LESS CURRENT LIABILITIES 28,891,556 29,245,124

CREDITORS
Amounts falling due after one year (2,163,178) (450,130)

PROVISIONS FOR LIABILITIES
Other provisions (338,756) (580,909)
Deferred tax (294,161) (323,328)

(632,917) (904,237)


NET ASSETS 26,095,461 27,890,757


CAPITAL AND RESERVES
Called up share capital 11,158,290 11,151,581
Share premium account 19,181,560 19,132,921
Merger reserve (1,076,399) (1,076,399)
Profit and loss account (3,409,640) (1,356,329)
Share option reserve 452,852 244,385


EQUITY SHAREHOLDERS' FUNDS 26,306,663 28,096,159
Minority equity interests (211,202) (205,402)


26,095,461 27,890,757


Approved and authorised for issue by the Board on 17 December 2007


P Kenny
Director


FIRESTONE DIAMONDS PLC
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 30 JUNE 2007


2007 2006
lb lb lb lb

Net cash outflow from operating activities (585,161) (2,401,275)

Returns on investments and
servicing of finance
Interest received 98,001 209,983
Interest element of finance lease payments (30,682) (34,049)
Interest paid on loans (103,653) (102,914)

Net cash (outflow)/inflow from returns on
investments and servicing of finance (36,334) 73,020

Capital expenditure and financial investment
Payments to acquire intangible fixed assets (2,202,029) (3,569,192)
Payments to acquire tangible fixed assets (2,893,420) (1,112,274)
Receipts from sales of tangible fixed assets 94,696 118,169

Net cash outflow from capital expenditure
and financial investment (5,000,753) (4,563,297)

Net cash outflow before use of
liquid resources and financing (5,622,248) (6,891,552)

Liquid resources
Amounts paid into short term deposits - (2,066,694)
Amounts paid out of short term deposits 2,066,694 -

2,066,694 (2,066,694)
Financing
Long term loans 2,132,115 -
Repayment of long term loans (6,847) (210,854)
Issue of ordinary share capital 55,348 9,884,975
Finance lease payments (219,342) (104,991)

1,961,274 9,569,130


(Decrease)/increase in cash (1,594,280) 610,884


1. Basis of preparation

The financial statements have been prepared in accordance with applicable UK
accounting standards and under the historical cost convention.


2. Profit per share

Basic profit per share is based on a profit of lb55,003 (2006: loss of lb194,598)
and a weighted average number of shares in issue of 55,758,177 (2006:
52,383,903). Diluted profit per share is based on the weighted average number

of shares in issue for the period plus potential dilutive ordinary shares
arising from share options for the period of 6,617,699.


3. Publication of non-statutory accounts

The financial information set out above does not constitute statutory accounts
as defined in section 240 of the Companies Act 1985. The consolidated profit
and loss account, balance sheet and cash flow statement and associated notes
have been extracted from the Company's 2007 statutory financial statements,
which were approved by the Board on 17 December 2007. The auditors have
reported on these accounts; their report is unqualified and does not contain
statements under section 237(2) or (3) of the Companies Act 1985. The financial
statements will be filed with the Registrar of Companies in due course. The
report and accounts will be posted to shareholders in the near future.


4. Annual General Meeting

The company's Annual General Meeting will be held at MWB Business Exchange, 60
Cannon Street, London EC4N 6NP on 31 January, 2008 at 11.00 a.m.


5. Dividends

The directors do not recommend the payment of a dividend for the period.


6. Qualified person review

Note: The information in this statement has been reviewed by Mr. Tim Wilkes, B
Sc, Pr Sci Nat, who is a qualified person for the purposes of the AIM Guidance
Note for Mining, Oil and Gas Companies. Mr. Wilkes is Chief Operating Officer
of Firestone Diamonds plc and has over 25 years experience in diamond
exploration, mineral resource management and mining. Mr. Wilkes is a member of
the sub-committee for diamonds of the South African Mineral Resource Committee
(SAMREC).


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

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