LONDON (Alliance News) – Weatherly International PLC Tuesday reported a widened pretax loss for its most recently ended financial year, and it said that it has engaged forensic auditors to confirm whether a fraud has occurred, after it identified a potential fraud within its central operations following the year end.

For the year to end-June the company reported a pretax loss of USD13.5 million, widened from a pretax loss of USD5.7 million a year before, as a rise in revenue to USD38.1 million from USD32.2 million was offset by higher cost of sales of USD44.4 million, up from USD31.6 million a year before.

Weatherly attributed a major factor as the decline in the copper price, which fell from nearly USD7,000 per tonne at the start of the year to USD5,720 per tonne at the end of the year.The company said that its distribution costs were higher than its previous year as a result of an increase in tonnes it shipped, but also a 20% increase in average shipping charges.

The company said that, as a result of the decline of the copper price at the beginning of 2015, its central operations came under review as the production levels it was achieving was uneconomic. Following the year end, mining and processing of ore at these central operations was suspended during September in light of the weak copper price.

The central operations consist of two underground copper mines, Matchless and Otjihase.

Weatherly International impaired all development costs at central operations, writing off USD8.0 million property plant and equipment. It has since taken the decision to convert its central operations to a project development status.

Elsewhere the company said that it had seen another year of “significant operational progress”, bringing its flagship project Tschudi in Namibia into operation. The company said that development at Tschudi is proceeding well, and by the end of the calendar year, it will be operating a new 17,000 tonnes per year open pit copper mine.

Following the year end the company said it had identified potential fraud in its central operations, and said it believes that any potential fraud is contained within central operations. The staff suspected involved are no longer with the group Weatherly said.

Shares in Weatherly were up 5.0% at 0.420 pence Tuesday afternoon.

By Hana Stewart-Smith;; @HanaSSAllNews

Copyright 2015 Alliance News Limited. All Rights Reserved.

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