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Update on Activities

08 December 2003

Southland Coal has achieved monthly records for both production and export sales of coking coal. During November 2003, run-of-mine coal production totalled 267,000 tonnes and export sales totalled 278,000 tonnes, significantly more than previous records.

The commissioning of the upgraded longwall unit has been smooth and, combined with the improvements to the operating regime nearly a year ago, Southland has demonstrated reliability at over 2.1 million tonnes of coal per annum, excluding blending operations.

Longer term contracts are being written with steel mills in several continents.

Gympie Eldorado Gold

The gold operation returned to budgeted grade in November at 7.5 grams per tonne, yielding 4,200 ounces of gold, excluding gemstone operations.

Exploration priorities for the next 6 months include first-pass drilling of 3 kilometres of strike length at South Inglewood. This never-before-exploited extension of the Gympie Goldfield is immediately south of the mine workings which have historically yielded over 2 million ounces of gold at an average head grade of over 20 grams per tonne. This southern zone has been uplifted to nearer ground-level but remains concealed from any surface expression.

First Tranche of Placement Completed

Gympie Gold Limited has completed the first tranche of the $25.0 million placement announced on 25 November 2003. The placement of 50.0 million shares comprised a first tranche of 28.5 million shares and a second tranche of 21.5 million shares. The second tranche is subject to approval by shareholders at a General Meeting of the Company being held on 8 January 2004.

This placement to investors in the United Kingdom and Australia introduced twelve major investment institutions to the company's ownership register. The issue price is A$0.50 per share or its equivalent at the exchange rate of $A2.355 to 1.00.

The net proceeds of the placing will be used to:

  • Meet increased working capital requirements of growing coal production;
  • Reduce the Company's debt-to-equity ratio from over 90% to below 60%; and
  • Pursue organic growth opportunities at both Southland Coal and Gympie Eldorado Gold.

Uncertificated Holdings Now Available on AIM

Gympie Gold Limited has now arranged for its ordinary shares and convertible notes traded on the London Stock Exchange's Alternative Investment Market (AIM) to be held and transferred in an uncertificated form.

With effect from today, CREST members will be able to hold and transfer interests in Gympie Gold ordinary shares and convertible notes within CREST, pursuant to a depository interest arrangement established by the Company.

Harry Adams, Managing Director, said "CREST in the UK is similar to CHESS in Australia, and enables the electronic registration of ownership instead of paper share certificates. This arrangement with CREST will facilitate trading of Gympie Gold's securities on AIM. Combined with the recent placement of 30 million shares to UK investors, the new facility should serve to increase significantly the liquidity of trading in Gympie Gold's securities on AIM."



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    Last Modified: Monday, 08-Dec-2003 14:58:02 EST