Widespread Portfolios - News

McDouall Stuart Securities report on Chatham Rise Project

2010-03-04T22:52:00Z

Widespread Energy

(NZX:WEN) $0.12 n.c.

Widespread Port.

(NZX:WID) $0.15 ▼

11.2%

Rock phosphate is a core input to fertiliser manufacture. Currently more than a million tonnes of phosphate is imported annually from Morocco, mostly by local heavyweights Ravensdown and Ballance AgriNutrients.At current prices of around US$200/t, the commodity value of imported phosphate adds to around $300m pa.

Cost of freight, which because of the extreme seaborne distance from Morocco is a very significant component of delivered cost, adds a further $170m pa. The opportunity therefore is for import displacement to the tune of around $500m annually, although potentially considerably more (during the peak of the 2007/08 commodity cycle, spot prices rose to US$500/t (Fig 11).

The prospecting permit requires the JV to undertake a specific work programme involving analysis of data collected during the 1970s and 1980s that supported the initial reserve estimates. Within the first 12 months of the permit the work programme agreed also requires the JV to undertake an environmental impact study and a pre-feasibility study into project economics of a commercial operation.

Investment view

Rock phosphate is not pie in the sky; it is both very real and very valuable. The specific potential of the Chatham Rise rock phosphate deposit was discussed in our Stepping Up report to MED last year. The extreme distance that imported phosphate must currently be hauled to reach the manufacturing process in New Zealand implies a very significant import displacement opportunity. The macroeconomic and external account benefits of large-scale import substitution are also highly attractive.

Despite the obvious benefits, the challenge would be a steep one. Seabed mining brings with it a substantially higher risk profile than onshore mining, particularly given the mid-water (~400m) depths in the Chatham Rise area. That said, seabed mining technology is already well established and the challenge of applying it to Chatham Rise appear manageable.

WEN/WID could not go it alone in a development (MD of both companies Chris Castle is WEN and WID’s only employee). The companies would likely sell-down their interest(s) to a party with the capability and capital needed to progress the venture, and to fund the estimated US$300m needed to bring to production.

Equity participation by one or perhaps even both local fertiliser majors also presents as an obvious option. In their release, WEN and WID report it “likely that the year two work programme, which will include a full bankable feasibility study and the gathering of seabed samples in order to define the minable resource, will be significantly enlarged and fast tracked. The broad expressions of interest in this project from investors, the fertiliser sector and other mineral exploration companies indicate that funding of this later phase will be achievable.”

WEN and WID are, in our view, stocks to watch over the next 12-18 months.

Widespread Portfolios 2009 Interim Report

2009-11-29T22:41:00Z

2009 AGM Presentation

2009-07-26T22:34:00Z

2009 Annual Report

2009-06-24T02:54:00Z

Final Announcement for the year to 31 March 2009

2009-05-27T01:12:00Z

Financial Summary

The year to 31 March 2009 was a year most of us have never seen and which we would like to forget. Worldwide markets melted down in a manner not seen since the Great Depression of the 1930s.

As an investor directly in equities and indirectly in commodities, Widespread Portfolios was severely impacted.

Our major investment, Asian Mineral Resources (AMR) plunged in value from CAD 1.51 in June 2008 to a low of 3 cents in November 2008. Its share price has subsequently recovered to 13 cents at the time of writing. Our two other major investments, King Solomon Mines and Golden Phoenix Resources were both similarly affected by the anarchic conditions in equities markets and commodity prices.

As a result, our shareholders’ funds (as recorded in our formal, New Zealand International Financial Reporting Standards (“NZIFRS”) dictated) financial statements reduced from NZD 17.562 million in March 2008 to NZD 4.290 million a year later. In our view the inflexibility of NZIFRS has created a distortion in the reported carrying value of AMR, our major investment. This is discussed in further detail later in this report.

Operating Result for the year

The after tax operating result, including unrealised losses on the share-trading portfolio and other non-cash provisions, was a loss of NZD 6,659,000 (2008, loss of NZD 751,000). An analysis of the trading result is provided in the table below

	Year to 31 March 09 ($,000)	Year to 31 March 08 ($,000)
Gains on the sale of shares		955
Other income	216	225
Total Income	216	1,180
Loss on the sale of shares	(200)	-
Unrealised gains (losses) on trading stock	11	(1,051)
Operating expenses	(600)	(611)
Impairment on investments	(6,008)	-
Warrant expense		(288)
Share of Widespread Energy loss	(193)	-
Net profit before income tax	(6,774)	(770)
Income tax	115	19
Net profit (loss) after tax	(6,659)	(751)

Disregarding unrealised losses and non-cash provisions, the operating outcome for the year was a pre-tax loss of NZD 776,000 (2008 profit of NZD 569,000)

Major Investments

Despite these set backs, Widespread still holds a diverse set of mining sector investments, both in terms of geographical spread and by commodity

Our major investments are detailed in the table below on the basis of their market values (excluding Asian Minerals) as at the date of this report.

	Activity	% portfolio today	Cents per WID share today
Asian Minerals	Nickel, Vietnam	62.4	22.3
King Solomon	Molybdenum, gold, China	13.2	4.7
Widespread Energy	Oil & gas, rock phosphate, NZ	6.9	2.5
Golden Phoenix	Gold, China	4.8	1.7
Other long term holdings	Gold, NZ Uranium, USA	4.6	1.6
Cash		6.0	2.2
Trading portfolio		2.1	0.8

Total		100.0	35.8

Asian Minerals is included at directors’ valuation based on a share of net assets. This valuation approach takes into account various independent project valuations and related sensitivity analyses undertaken by Malaysian Smelting, AMR management, and two of the “big four” auditing firms.

Carrying value of our major investment – Asian Minerals

Our significant shareholding in Asian Minerals has created somewhat of a valuation dilemma for our auditors, certainly in terms of our formal reporting requirements.

These are dictated by the New Zealand version of IFRS.

IFRS dictate that “fair value” for our Asian Minerals holding is determined by the TSX.V (Canada stock exchange) market price. Our auditors have determined that the most relevant market price is the last 20 day VWAP (volume weighted average price) prior to 20 May. This represents “fair value” as far as these regulations permit.

The May 2009 20-day VWAP is CAD 18.5 cents which values Asian Minerals at CAD 18.5 million (AMR has approximately 100 million shares on issue).

The two principal weaknesses in this approach are that a) it assumes an efficient market exists for AMR shares and b) that the market value of small parcels of AMR shares is the same as that for large holdings. Neither assumption is correct in respect of Asian Minerals shares and therefore “fair value” is not even a distant cousin of the market price.

As 98.7% of the shares in Asian Minerals are held by the top 20 shareholders (predominantly major, mining sector focussed institutional investors who are long term holders) only 1.3% of the issued capital is effectively free to trade.

Due to this lack of liquidity share turnover figures are usually very low and only small share parcels are being traded sporadically, presumably by Canadian mum and dad investors.

The AMR market is so thin that none of the major holders would contemplate selling or buying on-market because either action would certainly result in severe price distortion.

The Asian Minerals share register is dominated by large strategic stakes. Widespread, with 6.93%, holds the third largest shareholding, is represented on the Asian Minerals board, and forms part of the shareholding bloc that dominates the share register.

Malaysian Smelting Corporation, a Malaysian listed mining conglomerate also represented on the board, holds the second largest shareholding. Its recent annual report records that its 18.2% Asian Minerals shareholding is valued at CAD 26.4 million, effectively valuing the company at CAD 145 million. This audited carrying value is based on a robust project valuation of the Ban Phuc Nickel Mine forecast cash flows. This project valuation obviously matches or exceeds CAD 145 million.

The recently published Asian Minerals annual report records net assets of CAD 48 million. This figure is based primarily on construction costs capitalised since the mining license was granted in December 2007. This carrying value has been sustained, in discussion with the AMR auditors, again based on project valuations that obviously match or exceed CAD 48 million (as if they hadn’t an impairment write-down would have been necessary).

The point of all of this is that AMR’s directors and one of its major shareholders, a sophisticated and very substantial (total assets NZD 489 million) mining sector investor consider the value of Asian Minerals to lie somewhere in the range of CAD 48 million to CAD 145 million. Both carrying valuations have been subject to the intense scrutiny of the respective auditors concerned. Both valuations are lower than the market value of Asian Minerals in mid 2007 before the mining license was granted.

In contrast Widespread Portfolios is obliged in its formal financial statements to record a carrying value for its share-holding which implies a value for 100% of Asian Minerals of CAD 18.5 million.

Clearly, for the reasons already outlined, neither Widespread Portfolios nor the other major shareholders consider the present Asian Minerals market value has any relevance to the price at which they would consider selling their holdings. And even if the listed market price were significantly higher an additional control premium would normally be payable for these shareholdings.

We believe that the best way to deal with this anomaly is to outline our company’s financial position and particularly the net assets per share, based on four possible approaches to valuing the Asian Minerals shareholding.

Malaysian Smelting Corporation audited project valuation
Share of Asian Minerals audited net assets (our preferred approach)
20 day May 2009 VWAP on TSX.V (per NZIFRS dictate)
Current AMR spot price on TSX.V

The table below demonstrates the huge impact that the varying Asian Minerals valuations have on the value of Widespread shares.

	Implied AMR 6.9% Shareholding Valuation	Widespread Portfolios Net Assets	Widespread Net Assets per share
AMR Valuation approach*	(NZD m)	(NZD m)	(NZD cents)
Malaysian Smelting (DCF)	14.506	17.384	81.1
AMR Share of Net Assets	4.776	7.654	35.7
AMR Market (May 2009 20 day VWAP)	1.834	4.712	22.0
AMR Spot Market	1.294	4.172	19.5

* based on exchange rate of NZD1.00 = CAD 69.7 cents

We prefer the bricks and mortar based net assets figure of CAD 48 million, partially because this would be the floor price if it were decided by Asian Minerals to sell the project together with the mining license, exploration programme data, and other intellectual property in the company. Approximately CAD 75 million has been invested in the project since 1989.

The comparative valuation data in the table above, updated for daily currency and market price movements will regularly be posted on the home page of www.widespread.co.nz and advised to NZX every Friday.

Given the transparency of this information, our shareholders can then decide for themselves what they consider to be the value of our shares.

Trading since Balance Date

The year to 31 March 2010 has opened on a very quiet note. The pre-tax operating profit for the first two months, including fee income and one realised share-trading gain, is a small loss. There has been an improvement in the market value of both AMR and King Solomon Mines as well as our Canadian trading stocks.

Objectives for 2009/2010

The milestones we would like to achieve in the next 12 months include:

Continued support from the Vietnamese Government including further initiatives that will enable completion and commissioning of AMR’s nickel mine in north-western Vietnam
A successful AMR exploration programme
Exploration success for King Solomon Mines in Inner Mongolia
Advances in the Widespread Energy work programmes in respect to the Green Gate, offshore West Coast and Kotuku oil and gas prospects
Granting of the Chatham Rise mineral exploration permit followed by an active work programme
Building value in our other strategic holdings
An increase of at least 50% in the Widespread net asset backing per share
A positive pre-tax trading profit for the year (in other words excluding non realised gains and losses)

We have the cash or near resources to sustain the company well into 2011 by which time we expect market conditions to have improved and/or one or more of our major investments will have achieved success.

Annual Meeting

The Annual General Meeting of shareholders will be held at 5pm, 26 July at The Wellesley, 2-8 Maginnity Street, Wellington.

Auditors, Dividend & Directors

WHK Sherwin Chan & Walshe have confirmed their willingness to continue in office as Auditors to the Company.

The directors do not propose to recommend a dividend in respect of the period under review. This is in accordance with the Company’s stated core philosophy concerning dividends.

In accordance with the Constitution, Linda Sanders and Keith Hindle retire by rotation and being eligible offer themselves for re-election to the board.

Non-executive director Denis Kelly was appointed as a director by the Board of the Company on 12 January 2009. In accordance with the Constitution of the Company his appointment is required to be confirmed by shareholders at the next shareholder meeting. Being eligible, he offers himself for re-election.

For and on behalf of the Board,

Linda J Sanders Chris D Castle

Chairman Director

Takaka, 27 May 2009

Appendix 1 – NZX Format Financial Summary

Widespread Portfolios Limited

Year ended 31 March 2009

This report has been prepared in a manner which complies with generally accepted accounting practice and gives a true and fair view of the matters to which the report relates and is based on audited accounts.

CONSOLIDATED OPERATING STATEMENT
NZ$'000: Current Year; Previous corresponding Year

Total operating revenue: 161; 183

OPERATING SURPLUS (DEFICIT) BEFORE UNUSUAL ITEMS AND TAX: (6,774); (770)

Unusual items for separate disclosure: Nil
OPERATING SURPLUS (DEFICIT) BEFORE TAX: (6,774); (770)
Less tax on operating profit: (115); (19)
OPERATING SURPLUS (DEFICIT) AFTER TAX BUT BEFORE MINORITY INTERESTS: (6,659); (751)
Less minority interests: Nil
Equity earnings: Nil OPERATING SURPLUS (DEFICIT) AFTER TAX ATTRIBUTABLE TO MEMBERS OF LISTED ISSUER: (6,659); (751)

Extraordinary items after tax attributable to Members of the Listed Issuer: Nil
OPERATING SURPLUS (DEFICIT) AND EXTRAORDINARY ITEMS AFTER TAX ATTRIBUTABLE TO MEMBERS OF THE LISTED ISSUER: (6,659); (751)
Earnings per share: (0.0224); (0.0008)
Interim/Final/Special Dividend: Nil
Record Date: n/a. Date Payable: n/a
Imputation tax credit on latest dividend: n/a

This announcement is in relation to the year ended 31 March 2009.

Widespread Portfolios Limited will lodge with the NZX and send to holders its Annual Report once completed.

Interim Report Directors' Report

2008-12-20T01:58:00Z

Your directors submit the financial statements of Widespread Portfolios Limited for the six months to 30 September 2008.

The trading result for the period was a loss of $298,000 (6 months to 30 September 2007, $306,000 loss).

An analysis of the result is provided in the table below

	Six months to 30 Sept 2008 ($,000)	Six months to 30 September 2007 ($,000)	Year to 31 March 08 ($,000)
Gains on the sale of shares	(210)	735	955
Unrealised gains (losses) on trading stock	57	(715)	(1,052)
Other income	110	151	225
Total Income	(43)	171	128
Expenses	(303)	(324)	(610)
Warrant Expense			(288)
Net Profit (loss) before income tax	(346)	(153)	(770)
Income tax	48	(153)	19
Net profit (loss) after tax	(298)	(306)	(751)

Major Investments

Our major investments are detailed in the table below on the basis of their market values as at 30 September and as at the date of this report.

	Activity	% portfolio at 30 September 08	% portfolio today	Cents per WID share today
Asian Minerals	Nickel, Vietnam	37.8	38.3	11.0
King Solomon	Molybdenum, China	16.9	11.6	3.3
Widespread Energy	Oil & gas, rock phosphate, NZ	8.2	7.9	2.3
Golden Phoenix	Gold, China	17.9	20.5	5.9
Other long term holdings	Gold, NZ Uranium, USA	7.2	9.5	2.7
Cash		9.4	10.2	2.9
Trading portfolio		2.6	2.0	0.6
		100.0%	100.0%	28.7
Total value		6.950m	6.141m

All listed assets are included at market values with the exception of Asian Minerals which (as has been the case for six of the last eight years) is currently included at directors' valuation. This valuation approach takes into account independent project valuation data, the strategic nature of the shareholding, our close association with the company (including board representation), and all the present circumstances surrounding the Ban Phuc Nickel Project in Vietnam (further detail on these circumstances is included below). Recent sales in Canada of small shareholdings by small shareholders are not, in our view, a relevant benchmark for the value of our significantly larger stake in the company.

As can be seen from the table, we have quite a diverse set of major investments, both in terms of geographical spread and by commodity. Share trading activity is obviously not possible in current market conditions and in any event represents only a tiny fraction of our portfolio.

In terms of our own viability we have the cash resources to sustain the company well into 2010 by which time we expect market conditions to have improved and/or one or more of our major investments will have some success.

Asian Mineral Resources (presently 38.3% of our portfolio)

Until 13 June 2008, AMR was steadily progressing towards its goal of establishing a small-scale, high-grade underground nickel mine in northern Vietnam. The mining license had finally been granted in December 2007, substantial sums of money raised in early 2008 (including USD 34 million invested by Malaysian Smelting Corporation for a 20% stake in the company), and the mining camp, processing plant and mine development were well advanced and proceeding according to plan.. The company had already invested USD 61.5 million in the project since its inception and was in negotiations with a number of potential financiers willing to invest another USD 45 million to finance the completion of the plant. With 100 million shares on issue the market value of the company was then approximately CAD 150 million

On 13 June 2008, the Vietnamese Ministry of Finance introduced a number of economic measures including a 20% export tariff on oil, gas, and various metals, including nickel and copper. As there is no smelter in Vietnam capable of handling nickel and copper, the mine output must be exported and the export tariff was therefore effectively a 20% royalty on all mine revenue.

Few mining projects can withstand a royalty of this magnitude and this initiative effectively destroyed overnight the viability of the Ban Phuc nickel mine development. The consequences of this impacted immediately on the company - the finance negotiations were suspended and the market value of the company collapsed, to a recent low of CAD 3 million. The project has been mothballed with most of the 538 people (predominantly Vietnamese) who were involved in the construction being laid off.

There is light on the horizon. The Asian Minerals project was operating within the auspices of a recently granted (2007) twenty year investment license which, together with other Vietnamese investment laws, theoretically protected the project and its investors from any adverse consequences of any subsequent law changes. Asian Minerals is presently pursuing these rights (which include the right to compensation) but no speedy resolution is expected, hence in the interests of ensuring the company's survival, the decision to mothball the project.

Further information about AMR can be found at www.asianminres.com and any ongoing announcements by Asian Minerals in Canada will continue to be re-released by Widespread Portfolios in New Zealand.

King Solomon (11.6% of the portfolio)

King Solomon Mines ("KSO") is a minerals explorer with a number of gold, copper and other base metal projects in the Sonid region of Inner Mongolia in China. Sonid is on the edge of the Gobi desert - along strike and across the Mongolian-Chinese border from Ivanhoe's well-known and huge Oyu Tolgoi copper/gold deposit.

Widespread Portfolios holds 11% of the present issued capital of 90.8m shares and is represented on the board by Chris Castle.

A recent quarterly report issued by KSO confirmed interesting grades of molybdenum mineralisation at Marmot Ridge. While the field season has now concluded ongoing analysis of exploration results will continue during the northern winter.

Despite these encouraging results the KSO share price has recently fallen in line with that of virtually every other listed mineral exploration stock. It's also apparent that raising further cash from shareholders and other investors, even with the most exciting of exploration results, would not be easy for any mineral exploration company.

Taking these factors into account, KSO management (with the support of the board) have taken a number of steps to reduce operating costs, while still maintaining a reasonable level of exploration activity. This strategy is designed to ensure that the company will survive these tough times and be in a position of relative strength when the sun eventually shines on equity and commodity markets.

More information can be found at www.kingsolomonmines.com

Widespread Energy Limited ("WEN") (7.9% of the portfolio)

Widespread holds 26.5% of WEN, is the largest shareholder and provides management services to the company.

Widespread Energy is a venture capital investor in the energy sector.

During the six months to 30 September 2008, Widespread Energy continued to advance the work programmes for the two directly held petroleum exploration permits - PEP 38526 at Kotuku (near Lake Brunner) and PEP 50439, offshore west coast of the South Island.

The recent share market reversals and the accompanying collapse of oil prices together mean that the climate for raising equity capital for oil exploration, particularly in frontier (i.e. non-Taranaki) New Zealand locations has evaporated.

Widespread Energy's initial response to these changed market conditions has been to reduce expenditure levels to the bare minimum required to meet work programme commitments. By doing so, the company has the resources (without raising further capital) to remain in business and keep PEP 38526 in good standing until March 2010 and PEP 50439 until March 2012. Market conditions are presently so difficult it's pointless trying to farm out future major work programme commitments, but when conditions improve this will also be undertaken.

Widespread Energy has also been progressing various aspects of the Chatham Rise Rock Phosphate project, held in a joint venture with Widespread Portfolios. Further detail on this exciting project is included later in this report.

Widespread Energy holds 11.8% of Green Gate Limited, a private oil and gas exploration company established in 2003, which has built up a portfolio of primarily South Island focused petroleum exploration permits in North Canterbury, Murchison and the Solander/Great South Basin. Green Gate (1/3) and Australian listed company GB Energy (2/3) were granted an onshore Taranaki permit in September 2008.

Market conditions are also affecting Green Gate's ability to finance the work programme commitments for the five permits it holds and the company is exploring other options. These include seeking farm in partners or surrendering some permits.

Widespread Energy continues to hold a small investment (NZD56,000) in Akura Limited, a Fiji based private company, which has lodged applications for three Petroleum Exploration Licenses with the Mineral Resources Department of Fiji for a total of 17,667 square kilometres, most of this being offshore of Fiji. It is understood that these are about to be granted. Notwithstanding that, the political landscape in Fiji is such that Widespread Energy will not contemplate investing further in Akura until Fiji's interim government has achieved greater international acceptance than it has at present.

The outlook for Widespread Energy is positive. It also has the existing resources to sustain its viability and to advance its three principal projects during the next eighteen months.

Further information about WEN can be found on the Widespread Energy page at www.widespread.co.nz

Chatham Rise Rock Phosphate Project

This project has the potential to be the most exciting asset to be developed by the Widespread Group.

A joint venture presently comprising Widespread Energy Limited (90%) and Widespread Portfolios Limited (10%) applied last year for a prospecting license over an area of 3,048 km² on the Chatham Rise, 600 km east of Christchurch. This area is believed to include significant seabed deposits of rock phosphate (also known as phosphorite) and other potentially valuable minerals.

Initial scoping studies of a possible mining operation on only this limited area of the Chatham Rise make compelling reading.

At present the New Zealand fertiliser industry annually imports from Morocco approximately one million tonnes of rock phosphate and uses it to make a range of fertilisers including superphosphate.

Although the fertiliser industry has negotiated long term supply contracts with the Moroccan suppliers that presently reflect lower prices, earlier in 2008 spot prices for rock phosphate ex Morocco reached USD 500/tonne to which freight costs of over USD 100/tonne must be added.

Although rock phosphate prices have subsequently reduced, the New Zealand based fertiliser companies, also exposed to the weakening New Zealand dollar, will likely face steeply rising rock phosphate costs as supply contracts are renewed. One, Ravensdown Fertiliser Company, has already responded to this challenge by seeking other, local possible sources including the historic Clarendon Hill deposit in Southland.

Initial estimates indicate that rock phosphate could possibly be mined on the Chatham Rise for a cost per tonne equivalent to just the cost of freighting it from Morocco. Therefore, although the Chatham Rise rock phosphate is less concentrated than the imported material it appears likely that huge cost savings could be achieved. Other advantages of mining a local source would be reduced exposure to currency risk and likely ongoing price increases, as well as a significantly reduced carbon footprint.

It's also possible for the rock phosphate to be processed to derive phosphoric acid, the basic ingredient for a range of other fertilisers used in other countries.

In the circumstances it's not surprising that, despite the license not yet being granted, there has been significant and increasing local and overseas interest in our Chatham Rise project since the application was advised to shareholders and the share market some months ago.

The license, initially for a two-year period, is now expected to be granted in early 2009.

Other Long Term Holdings

The investments included in this category are Glass Earth, Fischer-Watt Gold, and Golden Phoenix Resources.

Glass Earth operates in New Zealand and is seeking large gold deposits in the Coromandel / Central Volcanic Region, and in Central Otago. The company is using a range of new technologies with the aim of discovering other gold deposits of a similar scale to that mined at Waihi and Macraes. This opportunity exists because, compared to other epithermal gold regions around the world, New Zealand is virtually unexplored with modern exploration techniques. The website is www.glassearthlimited.com.

Fischer-Watt Gold Company is a junior mining company that trades in the USA under the symbol of FWGO.OB. The company's backers have a very strong background in all facets of the mineral industry, exploration, production (both underground and open pit), and finance. The company recently announced that it had acquired a portfolio of mineral claims and leases on over 55,000 acres in Wyoming, South Dakota and Arizona that cover some of the most prospective uranium-bearing geology in the United States.

Golden Phoenix is a private mineral exploration company in which Widespread invested in 2007. Its focus is in China where it has recently acquired tenements potentially containing substantial gold deposits. Golden Phoenix's present strategy is to list on the ASX when market conditions are suitable.

Directors

Independent director Marion Franks has advised the board that due to her personal circumstances and other time commitments she intends to resign from the board of Widespread Portfolios with effect from 30 November. Marion Franks has been a most valuable member of the board since we listed on the stock exchange in early 2004 and her contribution is acknowledged.

The board has already identified several possible candidates to fill this vacancy and will advise the appointment of a replacement director in due course.

Outlook

The outlook for Widespread Portfolios is surprisingly positive. And though our total assets (around $6.1 million today) are only a quarter of those 12 months ago, we are pretty much in the same position as we were in 2005. The growth since then (we quadrupled in size in two years) was largely attributable to our Asian Minerals investment. The recent retrenchment can principally be laid at the same door. Time will tell whether the unauthorised actions of part of the Vietnamese government will be redressed or compensated for.

Several of your directors were deeply involved in equity markets at the time of the 1987 sharemarket collapse and the structure of Widespread Portfolios (established in 1989 with a kitty of only $200,000) was designed to ensure that if the same market anarchic conditions recurred, we would survive. So we have, from the outset, had no debt, entered no equity contracts with open ended liabilities and had a very low level of fixed overheads.

We are cashed up and have a sound, relatively diverse portfolio. Granted, their market values are depressed but their fundamental asset values (including strong management teams, enough cash, and exciting prospects) are in place.

By investing in Widespread you are indirectly investing in the future commodity prices of nickel, molybdenum, fertiliser, energy and gold. We are confident that the powerhouse that is China, together with the other BRIC countries (Brazil, India and Russia) will continue to drive base metal and energy prices over the medium to longer term. Locally, energy has to be a good sector to be in. And world population growth, together with the move to biofuels, will underwrite our desire to invest in the fertiliser industry.

For and on behalf of the Board,

Linda J Sanders Chris D Castle

Chairman Director

Onekaka, 28 November 2008

Interim Report Financial Statements

2008-12-20T01:55:00Z

Income Statement
For the period ended 30 September 2008

				Consolidated
				unaudited	unaudited	audited
				30 Sept 08	30 Sept 07	31 Mar 08
				$'000	$'000	$'000

Revenue				82	112	183

Finance income				28	339	524
Finance expenses				(153)	(280)	(579)
Net finance (expenses)/income		(125)	59	(55)

Administration expenses			303	324	898

Results from operating activities		(346)	(153)	(770)

Income tax (credit)/expense			(48)	153	(19)


Profit/(loss) from continuing operations	(298)	(306)	(751)



Basic earnings per share (cents)			(0.0522)	(0.0314)	(0.0755)

Diluted earnings per share (cents)			(0.0230)	(0.0162)	(0.0391)


Statement of Changes in Equity
For the period ended 30 September 2008

				Consolidated
				unaudited	unaudited	audited
				30 Sept 08	30 Sept 07	31 Mar 08
				$'000	$'000	$'000

Opening equity				17,562	19,367	19,367

Total recognised revenues and expenses
Net change in fair value of available-for-sale financial assets		(10,895)	3,995	(2,795)
Deferred tax recognised in equity		63	-	203
				(10,832)	3,995	(2,592)

Profit/(loss) for the year			(298)	(306)	(751)

Total recognised revenues and expenses for the period		(11,130)	3,689	(3,343)

Contributions from owners
Issue of shares				525	1,230	1,425
Own shares acquired				-	(153)	(175)
Share-based payments				-	-	288

Total Contributions from owners		525	1,077	1,538


Closing equity				6,957	24,133	17,562


Balance Sheet
As at 30 September 2008

				Consolidated
				unaudited	unaudited	audited
				30 Sept 08	30 Sept 07	31 Mar 08
				$'000	$'000	$'000

Assets
Other assets				6,195	23,176	16,979
NZX Bond				91	86	91

Total non-current assets			6,286	23,262	17,070

Trade and other receivables			60	54	26
Other investments				120	874	274
Prepayments				25	-	10
Brokers current accounts			-	27	306
Cash and cash equivalents			544	477	87

Total current assets				749	1,432	703


Total assets				7,035	24,694	17,773

Equity
Share capital				11,897	11,177	11,372
Reserves				113	13,657	7,336
Accumulated losses				(5,053)	(701)	(1,146)

Total equity attributable to equity holders of the Company		6,957	24,133	17,562


Total equity				6,957	24,133	17,562

Liabilities
Trade and other payables			29	37	50
Taxation payable				48	171	101
Deferred taxation				-	353	59
Advance to Widespread Energy Limited		1	-	1

Total liabilities				78	561	211

Total equity and liabilities			7,035	24,694	17,773


Statement of Cash Flows
For the period ended 30 September 2008

				Consolidated
				unaudited	unaudited	audited
				30 Sept 08	30 Sept 07	31 Mar 08
				$'000	$'000	$'000
Cash flows from operating activities

Cash received from customers			97	130	200
Proceeds from sale of other investments current	74	1,420	1,980
Net interest received				6	18	30
Tax refund received				-	-	13
Cash paid to suppliers				(374)	(349)	(606)
Purchase of other investments current		(59)	(443)	(549)

Net cash from/(used in) operating activities	(256)	776	1,068

Cash flows from investing activities

Proceeds from brokers current accounts		305	279	1
Proceeds to/(from) related parties		-	(104)	(104)
Purchase of other investments non-current	(112)	(1,619)	(2,192)
Purchase of property, plant & equipment		(1)	(1)	-
Reinvested interest NZX Bond		-	-	(5)

Net cash from/(used in) investing activities	192	(1,445)	(2,300)

Cash flows from financing activities

Proceeds from issue of share capital		521	1,230	1,425
Own shares acquired				-	(153)	(175)

Net cash from/(used in) financing activities	521	1,077	1,250

Net (decrease)/increase in cash and cash equivalents	457	408	18

Cash and cash equivalents at 1 April		87	69	69

Cash and cash equivalents at 30 September	544	477	87



Statement of Cash Flows
For the six months ended 30 September 2008

				Consolidated
				unaudited	unaudited	audited
				30 Sept 08	30 Sept 07	31 Mar 08
				$'000	$'000	$'000
Reconciliation of net cash flows from operating activities

Profit/(loss) for the period		(298)	(306)	(751)

Adjustments for:
Depreciation				-	-	1
Losses/(gains) on sale of financial assets at fair value through profit & loss		27	(260)	(482)
Unrealised gains on financial assets at fair value through profit & loss	127	108	578
Equity-settled share-based payment transactions	-	-	288
Deferred tax recognised in equity		4	-	203

				(140)	(458)	(163)

Change in trade and other receivables		(28)	17	17
Change in prepayments				(14)	(19)	(1)
Change in current tax assets			(53)	149	(216)
Change in trade and other payables		(21)	(7)	6
Change in other investments current		-	1,094	1,425

Net cash from operating activities		(256)	776	1,068





Income Statement
For the period ended 30 September 2008

				Company
				unaudited	unaudited	audited
				30 Sept 08	30 Sept 07	31 Mar 08
				$'000	$'000	$'000

Revenue				-	-	-

Finance income				-	-	6
Finance expenses				-	-	-
Net finance (expenses)/income		-	-	6

Administration expenses			123	149	550

Results from operating activities		(123)	(149)	(544)

Income tax (credit)/expense			4	-	11


Profit/(loss) from continuing operations	(127)	(149)	(555)




Statement of Changes in Equity
For the period ended 30 September 2008


Opening equity				8,641	7,658	7,658

Total recognised revenues and expenses

Profit/(loss) for the year			(127)	(149)	(555)

Total recognised revenues and expenses for the period		(127)	(149)	(555)

Contributions from owners
Issue of shares				525	1,230	1,425
Own shares acquired				-	(153)	(175)
Share-based payments				-	-	288

Total Contributions from owners		525	1,077	1,538


Closing equity				9,039	8,586	8,641



Balance Sheet
As at 30 September 2008

				Company
				unaudited	unaudited	audited
				30 Sept 08	30 Sept 07	31 Mar 08
				$'000	$'000	$'000

Assets
Other assets				6,462	6,462	6,462
NZX Bond				91	86	91

Total non-current assets			6,553	6,548	6,553

Trade and other receivables			19	-	1
Current tax assets				1	4	1
Deferred tax				-	15	4
Prepayments				25	28	10
Advance to subsidiaries				2,470	2,028	2,122

Total current assets				2,515	2,075	2,138



Total assets				9,068	8,623	8,691

Equity
Share capital				11,897	11,177	11,372
Reserves				113	(153)	113
Accumulated losses				(2,971)	(2,438)	(2,844)

Total equity attributable to equity holders of the Company		9,039	8,586	8,641


Total equity				9,039	8,586	8,641

Liabilities
Trade and other payables			29	37	50

Total liabilities				29	37	50

Total equity and liabilities			9,068	8,623	8,691



Notes to the Financial Statements
For the period ended 30 September 2008

These unaudited condensed interim financial statements of Widespread Portfolios Limited have been prepared in accordance with New Zealand Equivalent to International Accounting Standard (NZIAS) 34 Interim Financial Reporting, issued by the New Zealand Institute of Chartered Accountants. The Company and Group are profit oriented entities.

The Company is an issuer for the purposes of the New Zealand Financial Reporting Act 1993.

The unaudited condensed interim financial statements of the Group for the six months ended 30 September 2008 have been prepared using the same accounting policies and methods of computation as, and should be read in conjunction with, the financial statements and related notes included in the Group's Annual Report for the year ended 31 March 2008.

The same significant judgements, estimates and assumptions included in the notes to the financial statements in the Group's Annual Report for the year ended 31 March 2008 have been applied to these interim statements.

Segment reporting

Segment information is presented in respect of the Group's geographical segments. The group has only one business segment, that being investment.

Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.

Geographical segments
The investment segment operates in three principal geographical areas, New Zealand, Canada and Other.

In presenting information on the basis of geographical segments, segment revenue is based on the geographical location of investments. Segment assets are based on the geographical locations of the assets.


Notes to the Financial Statements
For the period ended 30 September 2008

Segment reporting continued

Group
Geographical segments		New Zealand	Canada	Other	Total
			$'000	$'000	$'000	$'000
30 September 2008 unaudited
Interest revenue			13	1	-	14
Other revenue			82	14	-	96
Total revenue			95	15	-	110

Segment assets			2,514	4,365	156	7,035


30 September 2007 unaudited
Interest revenue			17	5	-	22
Other revenue			73	208	148	429
Total revenue			90	213	148	451

Segment assets			1,152	20,916	2,626	24,694


31 March 2008 audited
Interest revenue			30	6	-	36
Other revenue			188	207	276	671
Total revenue			218	213	276	707

Segment assets			2,477	13,855	1,441	17,773

Widespread Portfolios 2008 AGM Presentation

2008-07-27T20:28:00Z

WIDESPREAD PORTFOLIOS 2008 AGM PRESENTATION JULY 27 2008

2007/8 was a mixed bag

• Our major investments (AMR, KSO and WEN) all made good progress in operational terms

• Did not translate into improved market values

• Hence, a reduction in our portfolio value with a corresponding reduction in our own market value

• Our shares and warrants were actively traded

• Shares were recently consolidated 50:1 (short term pain but long term gain)

The detail....

Reported after tax loss of $751,000 - real result (ignoring unrealised loses and non-cash provisions) was profit of $569k

• Net assets per share decreased from 105 cents to 85 cents (now 72 cents)

• Shareholders increased from 810 to 850

• Issued capital is now 21,435,782 shares and 8,505,123 warrants

• Widespread traded frequently on the NZSX (1.8 million shares and 388,000 warrants in the last 12 months)

• Last sale at 46 cents and 20 cents values the company at $11.6m vs. $23m last year, $10.2m in July 06 and $5.4m in July 05

• Net assets are presently $15.4m, ($25.3m last July and $10.2m in July 2006)

Chart - 30 month market value & net assets trend

Chart - Portfolio Composition
(present net assets per share 72 cents)

Asian Mineral Resources
2007/8 milestones

• Mining license granted December 2007

• Mine development commenced immediately

• Processing plant and mining camp under construction

• $67 million raised in last 12 months to finance operations and construction

• Offtake agreement signed with Chinese nickel smelter group Jinchuan

• Active exploration programme underway, there are a number of other already identified prospects nearby

AMR - recent developments

• June 13, Vietnam Ministry of Finance announces 20% export tariffs on minerals (incl.nickel) plus oil and gas

• Vietnam investment regulations (prima facie) protect AMR's earlier position

• Other Vietnam govt agencies agree the tariff is destructive of foreign investment

• This week AMR advised that "it has initiated discussions with the appropriate Vietnamese governmental authorities and has begun enlisting the support of other interested parties in seeking to have the tariff increase rescinded"

• This will take time to resolve and the outcome is not certain

• AMR has not quantified the impact of the proposed tariff on the project economics

AMR - recent developments continued

• AMR needs to raise $45m for working capital and to complete the mine and plant, continue the exploration programme etc

• This is required before the tariff situation is likely to be resolved

• AMR has announced that "it is continuing financing negotiations in parallel with alternative financing mechanisms"

• Existing major shareholders (Malaysian Smelting Corporation, The Dragon Fund, Jinchuan, etc) should logically support the financing.

• Financing issues aside, the project continues to be on schedule for concentrate production in the second quarter of 2009

• AMR has other eggs in the basket (adjacent orebody and various exploration initiatives)

King Solomon Mines ("KSO")

• ASX listed Inner Mongolia (China) based mineral exploration company

• WID is largest shareholder with 11% and has board representation

• "Greenfields" explorer (no defined or measured mineral reserves yet)

• Focus is on large scale copper/molybdenum and gold targets

• Most exciting projects are Marmot Ridge (Cu/Mo), Wuritu (Cu), Bu Dun Hua (Au, Cu), Beyinhar North (Au), Naogaoshandu (Au)

• Very active exploration programme 8 months/year

For more info, visit www.kingsolomonmines.com or attend their AGM in Wellington on August 15

KSO Capital Structure

Shares 90.8 million

Options 6.8 million

Cash (31 Mar. 08) $6.3 million (6.9c)

Mkt. Capitalisation $10.9 million (12c)

12 month trading 10c - 23c

Marmot Ridge Cu-Mo Project

• Large hydrothermal alteration system (>6sq km)

• Geological setting analogous to neighbouring Ivanhoe deposit

• 7,000m diamond drilling to date

• Widespread anomalous Cu in drillholes

• Significant Mo mineralisation in drillholes (6 out of 7 in current programme)

• Target: 500Mt + Cu-Mo deposit

Widespread Energy (WEN)

• WID holds 26.7% of NZAX listed WEN and is also the manager

• WEN holds 11.8% interest in Green Gate Limited, the holder of four petroleum exploration permits (PEPs) in three South Island areas (Canterbury, Murchison and Great South Basin)

• WEN has 100% of PEP 38526 over the prolific oil seeps at Kotuku on the West Coast

• WEN has 100% PEP 50439 for an area of over 3,286 km², off the West Coast of the South Island between Hokitika and Punakaiki.

• WEN now has six oil/gas opportunities in NZ

Chatham Rise Phosphorites (1)

• WEN has also (in conjunction with Widespread Portfolios) applied for an exploration license over part of the Chatham Rise.

• The area under application contains large quantities of phosphorite nodules (rock phosphate), presently imported from Morocco by the NZ fertiliser industry.

• Ravensdown alone imports 750,000t

• The energy-related logic driving this project is the projected rapid increase in biofuels that is likely to result in substantially increased demand for fertilisers and on-going increases in fertiliser prices.

Chatham Rise Phosphorites (2)

• The nodules also contain fluorine, rare earth minerals and other valuable by-products.

• Early 80s exploration by Fletcher Challenge, and other companies indicated economic concentrations of phosphorite on the Chatham Rise.

• Rapidly increasing superphosphate prices and advances in underwater mining technology (e.g., Neptune Minerals and Nautilus Minerals) mean exploration and development is now significantly more feasible.

• The phosphorite resource may exceed 100m/t (worth NZ$46b+) and could prove economically viable depending on extraction costs.

• ASX-listed Mine Makers (MAK) has a measured resource of 71m/t in the NT. Since Feb 08 the market value of MAK has risen from Aud$20m to a peak of Aud$267m

Chatham Rise (3)

• WID/WEN plan a 2 year work programme that, if successful, will be followed by more detailed exploration and evaluation.

• This will include feasibility studies updating the work already undertaken 25 years ago (new technology, different costs)

• GPS not in existence then, now makes it possible to precisely mine the seabed with automated equipment

• Feasibility studies carried out for deep sea miner Neptune Resources are very encouraging

• Significant interest in this project from very large, overseas based mining conglomerates

• All major NZ fertiliser companies have already made contact

• Our 3,048 sq km license application has been surrounded by a subsequent application of 71,750 sq km by Auckland company Chatham Phosphate Limited

WID Outlook

• Last year the 12 month forecast for a possible increase in net assets per share (if all went according to plan) was 48% from $1.16/share to $1.72.

• Actual result was a reduction of 38% to 72 cents (despite AMR getting its mining license)

• So, no forecast this year.....

• But, key value drivers are 1) the successful financing and completion of the Asian Minerals nickel project, 2) good exploration results from King Solomon and 3) the grant of the Chatham Rise prospecting license.

2008 Annual Report

2008-06-25T09:29:00Z

Capital Economics Rights Issue Assessment

2008-05-16T21:30:00Z

Introduction

This assessment of the theoretical impact of Widespread Portfolio Limited's (WID) proposed rights issue has been prepared at the request of its board by Capital Economics Limited. The focus of the assessment is on the potential of the issue to shift wealth between categories of equity securities and between large and small shareholdings. The following sections of this report consider, in turn:

the scale of the issue in terms of its potential to cause significant effects on the unit prices of WID's equity securities
the scale of the potential adjustments to the exercise prices for WID's warrants under section 9 of the terms for the warrants
the theoretical implications of the issue for the relative unit values of WID's equity securities; and
the potential distributional effects of these potential changes in unit values.

A final section draws some conclusions from this investigation.

2008 Autumn Update

2008-05-04T23:36:00Z

2008 Broker Analyst Report

2008-01-22T01:23:00Z

No sharebroker analyst reports have been published about Widespread Portfolios. If you are an analyst with a sharebroker, or an independent financial analyst of any type, why not be the first to prepare such a report?

Widespread already has an outstanding track record and our future prospects look good.

Be brave and give it a shot.

2007 Presentation

2007-08-01T02:19:00Z

2006 Presentation

2006-12-31T23:30:00Z

2006 Annual Report

2006-12-31T23:29:00Z