JOHANNESBURG (miningweekly.com) – Aim-listed diversified miner Red Rock Resources will, by January 2016, make substantial reductions in its employee numbers.

This would result in a reduction of over 50% in net overheads a month, including office and administration, professional services and listing-related costs.

This followed the conclusion of the company’s current phase of its cost and capability review. The gold and iron-ore miner in September said that, in light of continuing difficult market conditions, a review of staffing levels and functional requirements had been in progress for several weeks.

"We have taken and are taking further radical steps to restructure not only our balance sheet but our cost structure. Improvement of our cash flow balances, both by reducing outflows and creating inflows, is a principal objective, since this will cause the market to attribute more value to the strong asset backing of the company and provide a more robust platform for growth and for taking advantage of opportunities that arise in the depressed natural resource space,” Red Rock Resources chairperson Andrew Bell said at the time.

He added that, while the company had been well served by its project teams and finance staff, the market had changed.

“We have worked over the last three years on restructuring the balance sheet and cutting costs and on disposals of mature or noncore assets. We are now discussing potential transactions that will bring in earnings and expect further opportunities of this kind to be available,” he noted.

Red Rock had eliminated costs and responsibilities associated with the assets held in Colombia and, given a legal process under way in Kenya, the only currently active exploration project remaining was in Côte d’Ivoire.

The early stages of exploration on the ground would be carried out using local resources and, through its relationships and contacts, Red Rock would continue to have access on an as-needed basis to any necessary skill sets for all its activities. 

Meanwhile, the company reported that ASX-listed Star Striker (SRT), in which Red Rock held 8.92%, would carry out a placement to raise up to A$780 000 at a price of A$0.008 a share.

Red Rock held 65.3-million shares in SRT and 5.2-million options exercisable up to March 31, 2016, at a price of A$0.004 apiece.

“We welcome the move by Star Striker to further strengthen its balance sheet, supporting the value of our holding,” Bell added.