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Randgold & Exploration Company Limited
(Incorporated in the Republic of South Africa)
(Registration number 1992/005642/06)
Share Code: RNG & ISIN: ZAE000008819

(“R&E” or “the company”)

Reviewed results for the six months ended 30 June 2013 COMMENTARY TO THE CONDENSED CONSOLIDATED REVIEWED INTERIM FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 30 JUNE 2013

General
The board of R&E is pleased to announce the interim results for the six months ended 30 June 2013.

Income
The majority of the income recognised in the period under review derived from the settlement of a legal claim, profit realised on the disposal of prospecting rights and finance income.

Financial position
R&E is liquid with no interest-bearing debt. R&E's total assets consist primarily of cash. R&E has a net asset value per share of R2.69 at 30 June 2013 (which represents an increase of 8.5% from 30 June 2012).

Cash flow
R&E started the period under review with a cash balance of R214 million. Operating activities generated cash of R15.3 million, primarily as a result of the settlement of a legal claim of R19.5 million and interest received of R5.4 million against operating expenses of R14.6 million (which included legal and forensic costs of R8.9 million).

Investing activities yielded cash inflows of R1.5 million received from the sale of prospecting rights.

R&E remains in a healthy cash position with R231 million in cash and cash equivalents at 30 June 2013.

Outlook
The outlook for 2013 is similar to that for the previous year. Expenditure on litigation is expected to be at a similar level, which is likely to prevail until
the claims the company has initiated have been are finalised. Management will continue to focus on reducing the operational costs of its operations where possible
and to maintain liquidity.


David Kovarsky
Chairman
Marais Steyn
Chief Executive Officer
Johannesburg
8 August 2013

CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME

    For the six months ended
   
30 June 2013
Reviewed
30 June 2012
Reviewed
  Notes
R'000
R'000
Dividends received  
28
-
Profit on disposal of prospecting rights 6
1 076
5 037
Profit on sale of equity securities  
140
-
Recoveries 7
22 136
15 521
Foreign exchange (losses)/gains  
(35)
532
Other income  
2 473
2 041
Other operating expenses  
(14 621)
(19 879)
Results from operating activities  
11 197
3 252
Finance income  
5 357
5 597
Profit before taxation  
16 554
8 849
Taxation  
-
-
Profit for the period  
16 554
8 849
Other comprehensive income  
-
-
Total comprehensive income  
16 554
8 849
Profit attributable to: Owners of the company  
16 554
8 849
Total comprehensive income attributable to: Owners of the company  
16 554
8 849
Basic and diluted earnings per share (cents) 8
23
12
       
CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY
    For the six months ended
   
30 June 2013
Reviewed
R'000
30 June 2012
Reviewed
R'000
Share capital balance at the beginning and end of the period  
746
746
Retained earnings  
191 686
177 129
Balance at the beginning of the period  
175 132
168 280
Profit for the period  
16 554
8 849
       
CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION
    As at
   
30 June 2013
Reviewed
R'000
31 December 2012
Audited
R'000
Assets  
Non-current assets  
145
661
Plant and equipment  
96
187
Intangible assets  
49
474
Current assets  
233 555
217 311
Trade and other receivables  
1 188
1 502
Investment in equity securities  
952
1 892
Cash and cash equivalents  
231 415
213 917
Total assets  
233 700
217 972
Equity and liabilities  
Shareholders' equity  
192 432
175 878
Issued capital  
746
746
Retained earnings  
191 686
175 132
Liabilities  
Non-current liabilities  
Post-retirement medical benefit obligation  
39 058
40 768
Current liabilities  
Trade and other payables  
2 210
1 326
Total equity and liabilities  
233 700
217 972
       
CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS
    For the six months ended
   
30 June 2013
Reviewed
R'000
30 June 2012
Reviewed
R'000
Profit before taxation  
16 554
8 849
Adjusted for:  
Loss on sale of other assets  
65
-
Profit on disposal of prospecting rights  
(1 076)
(5 037)
Other non-cash items  
(1 426)
256
Profit on disposal of equity securities  
(140)
-
Movement in post-retirement medical aid benefit liability  
(1 710)
219
Depreciation  
27
37
Loss on fair value of equity instruments  
397
-
Interest received  
(5 357)
(5 597)
Dividends received  
(28)
-
Working capital changes  
1 198
(3 614)
Cash flows from operations  
9 930
(5 143)
Interest received  
5 357
5 597
Cash flows from operating activities  
15 287
454
Cash flows from investing activities  
2 211
5 037
Dividends received  
28
-
Proceeds from disposal of prospecting rights  
1 500
5 037
Proceeds from disposal of equity securities  
721
-
Acquisition of investment in equity securities  
(587)
-
Investment in mark to market  
549
-
Net increase in cash and cash equivalents  
17 498
5 491
Cash and cash equivalents at the beginning of the period  
213 917
211 470
Cash and cash equivalents at the end of the period  
231 415
216 961


NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 30 JUNE 2013
1. Reporting entity

R&E is a company domiciled and incorporated in the Republic of South Africa. The condensed consolidated interim financial statements of the company for the six
months ended 30 June 2013 include the company and its subsidiaries (together referred to as the "group").

2. Statement of compliance

The condensed consolidated reviewed interim financial statements are prepared and presented in accordance with International Financial Reporting Standards, which include International Accounting Standard (IAS) 34 Interim Financial Reporting, the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and the requirements of the Companies Act of South Africa (Act 71 of 2008). These condensed consolidated interim financial statements were approved by the board of directors on 5 August 2013.

Mr Van Zyl Botha CA(SA), the financial director of R&E, is responsible for these interim financial statements and has supervised the preparation thereof.

3. Significant accounting policies

The accounting policies applied by the group in these condensed consolidated interim financial statements are the same as those applied by the group in its consolidated financial statements for the year ended 31 December 2012.

4. Independent review by the auditor

The condensed consolidated interim financial statements of R&E for the six months ended 30 June 2013 have been reviewed by the company's auditor, KPMG Inc. In their review report dated 5 August 2013, which is available for inspection at the company’s registered office, KPMG Inc state that their review was conducted in accordance with the International Standard on Review Engagements 2410, Review of Interim Information Performed by the Independent Auditor of the Entity, and have expressed an unmodified conclusion on the condensed consolidated interim financial statements.

5. Segment reporting

The group operates in a single operating segment as an investment holding company with assets in the mining industry.

6. Profit on disposal of prospecting rights

R&E disposed of certain of its prospecting rights which had a R0.4 million carrying value for R1.5 million.

7. Recoveries

R&E concluded a settlement agreement with Mr Paul Main on 23 March 2012 in terms of which USD4 million was payable by Mr Main to R&E. The settlement relates to the group's claim against him for damages in respect of 2 million Randgold Resources Limited shares. Shareholders are referred to the announcements made by the company on 30 May 2013 relating to this settlement. R&E recognised the final payment of R22 million received in cash during June 2013.

8. Earnings per share

    For the six months ended
Basic earnings and diluted earnings per
ordinary share
 
30 June 2013
Reviewed
30 June 2012
Reviewed
   
Basic and diluted earnings for the period (R'000)  
16 554
8 849
Weighted average number of ordinary shares in issue  
71 585 172
71 585 172
Earnings per share (cents)  
23
12
Headline and diluted headline earnings per ordinary share  
Headline and diluted headline earnings for the period (R'000)  
15 338
3 812
Weighted average number of ordinary shares in issue  
71 585 172
71 585 172
Headline earnings per share (cents)  
21
5
Reconciliation between basic and headline earnings for the period  
R'000
R'000
Profit for the period attributable to the equity holders of the company  
16 554
8 849
Adjusted for:  
Profit on disposal of prospecting rights  
(1 076)
(5 037)
Profit on disposal of available-for-sale investments  
(140)
-
   
15 338
3 812
Tax effect of adjustments  
-
-
Headline earnings for the period attributable to equity holders of the company  
15 338
3 812


9. Net asset and tangible net asset value per share

The net asset value per share is calculated using the following variables:

   
30 June 2013
Reviewed
30 June 2012
Reviewed
Net asset value (R'000)  
192 432
177 875
Ordinary shares outstanding  
71 585 172
71 585 172
Net asset value per share (cents)  
269
248
Net tangible asset value per share (cents)  
269
247

The number of shares outstanding at 30 June 2013 and 30 June 2012 has been adjusted for the 2,999,893 treasury shares held.

10. Material changes

The final settlement received from Mr Paul Main is material in its totality.

11. Related party transactions

There were no related party transactions during the period under review other than in the normal course of business, i.e. key management remuneration.

12. Events after reporting date

There were no significant events between the reporting date and the approval date of these results.

Directors: DC Kovarsky (Chairman)**, M Steyn (CEO)*, V Botha*, P Burton#**, JH Scholes** (*Executive, **Independent non-executive, #Appointed 23 May 2013)
Company secretary and financial director: V Botha CA(SA)

Transfer secretaries: Computershare Investor Services (Pty) Ltd (Registration number 2004/003647/07), 70 Marshall Street, Johannesburg, 2001

Sponsor: PSG Capital, 1st Floor, Ou Kollege Building, 35 Kerk Street, Stellenbosch, 7600