TIDMBMN
RNS Number : 9689B
Bushveld Minerals Limited
26 September 2018
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have
been deemed inside information for the purposes of Article 7 of
Regulation (EU) No 596/2014 until the release of this
announcement.
26 September 2018
Bushveld Minerals Limited
("Bushveld" or the "Company")
Unaudited interim results performance report for the period
ended 30 June 2018
Bushveld Minerals Limited (AIM: BMN), the AIM listed, integrated
primary vanadium producer, with ownership of high grade vanadium
assets, is pleased to announce its half year unaudited results, for
the six months ended 30 June 2018.
H1 2018 Financial Highlights
-- First period of fully consolidated accounts since the Company
increased its shareholding in Bushveld Vametco Holdings
(Proprietary) Limited ("Vametco") from 26.6% to a controlling 59.1%
in December 2017, and subsequently to 75% in September 2018;
-- Bushveld Minerals consolidated H1 2018 Revenue of GBP62.1
million;
-- Bushveld Minerals consolidated EBITDA of GBP31.7 million (H1
2017: GBP1.0 million including share of results of associate);
-- Bushveld Minerals consolidated Profit after tax of GBP21.1
million (H1 2017: GBP1.1 million);
-- Bushveld Minerals consolidated Free cash flow(1) of GBP10.2
million (H1 2017: (GBP1.4million));
-- Bushveld Minerals consolidated Cash balance of GBP26.2
million as at 30 June 2017 (H1 2017: GBP71.5 thousand);
-- Bushveld Minerals consolidated Gross debt of nil (H1 2017:
nil);
-- Earnings per share of 1.14p (H1 2017: 0.26p).
(1) Free cash flow: comprises net operating cash flows less net
investing cash flows.
H1 2018 Operational Highlights
-- Nitrovan(TM) sales of 1,403 mtV (H1 2017: 1, 341 mtV);
-- Nitrovan(TM) production of 1,360 mtV (H1 2017: 1,441
mtV);
-- Bushveld remains one of the lowest cost vanadium producers in
the world, with H1 operating costs of ZAR248.4/KgV (US$20.2/KgV)
(H1 2017: US$15.4/KgV);
-- Phase Two of the Vametco Expansion project completed on time
and within budget to raise nameplate capacity to 3,750mtV;
-- The exploration programme at the Brits Vanadium Project has
shown vanadium grades in magnetite of 1.54 - 2.09% V(2) O(5) ;
-- Bushveld Energy and the Industrial Development Corporation
("IDC") received delivery of the first vanadium redox flow battery
("VRFB") from UniEnergy Technologies ("UET") in South Africa;
-- Bushveld Energy and IDC continue to progress work to build an
electrolyte manufacturing plant in South Africa, to be located at
Vametco and the East London Industrial Zone;
-- Lemur Holdings and the Government of Madagascar concluded the
30-year Project Concession Agreement;
-- Lemur Holdings completed the inception site visit for the
Social and Environmental Impact Assessment ("SEIA") at the Imaloto
Power Project with related field studies commencing thereafter;
-- Lemur Holdings and the state-owned utility, Jiro sy Rano
Malagasy ("JIRAMA"), amended the Power Purchase Agreement to
significantly increase the latter's offtake to up to 25MW.
H1 2018 Corporate Highlights
-- Completed a GBP15.7 million (US$22.2 million) equity placing
before expenses by way of an oversubscribed placing of 152,749,172
new ordinary shares at a price of 10.3p per share;
-- Redeemed and settled the Atlas Convertible Bonds in full, for
a final aggregate cash payment of GBP5.12 million;
-- Appointed Michael J. Kirkwood as Senior Independent
Non-Executive Director;
-- Appointed Alternative Resource Capital, a trading name of
Shard Capital Partners LLP, as joint broker of the Company;
-- Listing on the Johannesburg Stock Exchange remains a priority
for the Company, with the work progressing accordingly;
-- Number of Warrants in issue as at 25 September 2018.
No. of warrants outstanding Exercise Price Lapse Date
(GBp)
3,598,684 6.9p 31 March 2020
--------------- --------------
22 September
6,257,309 13.84p 2020
--------------- --------------
H1 2018 Bushveld Vanadium Update
-- Vametco H1 2018 Revenue increased by 139.2% to ZAR 1,050
million (GBP62.1 million) compared with H1 2017 revenue of ZAR 439
million (GBP26.4 million).
-- Vametco H1 2018 EBITDA increased by 429.6% to ZAR 521 million
(GBP30.8 million) compared with ZAR 98.4 million in H1 2017 (GBP5.7
million).
-- The Metal Bulletin FeV mid-average price for H1 2018 was
US$65.5/ KgV, an increase of approximately 150% relative to the H1
2017 average price of US$26.2/ KgV.
-- Vametco's realised price is based on an average one month prior to sale.
-- FeV price has continued to strengthen with the Metal Bulletin
FeV mid-price averaging US$80/ KgV in the two months ended August
2018.
-- Vametco achieved an all-time record magnetite kiln feed
during Q1 2018, supported by the completion of Phase One of the
expansion project.
-- Vametco completed Phase Two of the expansion project. This
phase of the expansion project will increase the nameplate capacity
from 3,035 mtV, achieved in Phase One, to 3,750 mtV, through
self-funded capital expenditure of US$2.5 million.
-- The Company commenced an exploration programme at the Brits
Vanadium Project, which has shown positive results with vanadium
grades in magnetite of 1.54-2.09% V(2) O(5) , similar to grades
mined at Vametco.
H1 2018 Bushveld Energy Update
Electrolyte production facility
-- Engaged an international chemicals company that has already
designed and built a vanadium electrolyte production plant with
multiple megalitre annual capacity.
-- Initiated the Environmental Impact Assessment (EIA) process
for the electrolyte production plant, including appointment of
local EIA consultants.
Eskom VRFB project
-- Completed manufacturing of the Direct Current (DC) portion of
the VRFB.
-- Appointed two technicians from South Africa to perform
installation support and maintenance on the Eskom project. The
first phase of the technicians' training was held at UET, in April
2018. This will give Bushveld Energy the capability to install and
maintain future VRFB installations in South Africa and
regionally.
-- Bushveld Energy and the IDC received delivery of the first
VRFB from UET in South Africa. This included the mixed-acid
vanadium electrolyte to be used in the battery.
H1 2018 Lemur Holdings Update
-- Lemur Holdings and the Government of Madagascar concluded a
30-year Project Concession Agreement which gives Lemur the right to
build, own, operate and supply an initial 60 MW. In addition, the
concession gives Lemur the right to build an evacuation line of up
to 138kV for transport of the electricity to the connection
points.
-- Completed the inception site visit for the SEIA at the
Imaloto Power Project and commenced the relevant field work for the
SEIA.
-- Amended the Power Purchase Agreement with the state-owned
JIRAMA from the existing 10MW to allow the utility to offtake up to
25MW.
Events post 30 June 2018
Bushveld Minerals
-- Completed the acquisition of a 21.22% interest in Strategic
Minerals Corporation("SMC") (the ultimate holding company of
Vametco Alloys Proprietary Limited) from Sojitz Noble Alloys
Corporation. The Acquisition of all of Sojitz's legal and
beneficial interest in SMC was acquired for a total cash
consideration of US$20,000,000, including US$2,500,000 in accrued
dividends. The acquisition increased Bushveld Minerals' controlling
interest in Vametco Holdings from 59.1% to 75%.
-- An unprotected industrial action at Vametco temporarily
stopped production from the evening of 5 September. The industrial
action was in relation to historic legacy issues and compensation
structures prior to Bushveld's acquisition of Vametco. The strike
ended on 21 September, when Bushveld Minerals and the Association
of Mineworkers and Construction Union ("AMCU") announced that they
had reached an agreement. The agreement includes:
-- The settlement agreement, signed between Vametco and AMCU in
May 2018 in respect of payments in lieu of Employee Share Options
Scheme ("ESOPS") for the period 2013 to December 2017, is valid and
recognised.
-- Vametco will pay employees an amount in lieu of ESOPS for the
year 2018 on the same basis as the ESOPS payment made as part of
the May 2018 settlement agreement. The payments (the "2018 ESOPS
payment") will be structured as a two-part payment:
-- A payment of R15,000 (post-tax) shall be paid to each
employee in respect of the period 1 January to 30 June 2018. This
amount shall be paid on 28 September 2018.
-- A second payment, in respect of the period 1 July 2018 to 31
December 2018, shall be payable after the release of the financial
results of Bushveld Vametco Alloys Limited for FY2018 which is
expected to be paid by 31 March 2019.
-- The new agreement discourages any future participation in
unprotected industrial actions by the workers at the risk of losing
participation of any ESOP payments.
Following 16 days of unprotected industrial action, operations
and production at Vametco resumed on 22 September 2018.
The unprotected industrial action may impact Vametco's 2018
production and cost guidance. The Company is in the process of
quantifying the impact of the stoppage and such guidance will be
provided no later than the Q3 2018 Bushveld Vanadium Operational
update.
Bushveld Energy
-- During commissioning of the VRFB, a performance issue was
experienced, and initial assessments confirmed a vanadium
electrolyte constraint. As a result, the battery was not able to
meet the specified operational performance. It was also determined
that it would not be possible to resolve the constraint in South
Africa at this time and a remediation strategy was immediately
implemented. The remediation includes the provision of new
electrolyte and hardware for the DC module of the battery. This
will allow commissioning to resume and be completed in Q4 2018. The
Company will provide an update on progress in November 2018.
-- Bushveld Energy was awarded a grant from the Government of
the United States of America, acting through the U.S. Trade and
Development Agency (USTDA). The grant will provide support in
implementation and enhancement of Bushveld Energy's previously
announced VRFB project at the Eskom mini-grid at its Research,
Testing & Development centre. It will also support the
development of new modelling capabilities to cover the combination
- or "stacking" - of multiple benefits from energy storage supplied
by one battery.
Commenting on the results, CEO Fortune Mojapelo said:
"I am pleased to report the first set of financial results that
reflect the full consolidation of Vametco's accounts since Bushveld
Minerals acquired a majority controlling interest last December. It
is particularly pleasing to report our first ever consolidated net
profit and net free cash flow for the Bushveld Group. We expect to
show continuously improving performance as we integrate and grow
the business.
"We recently increased our interest in Vametco to 75% to gain
maximum exposure of the business we operate. While Vametco is
already a low cost producer of vanadium, we believe potential exits
to further improve its cost position by improving its productivity.
To this end we will be developing and implementing several
productivity initiatives, in addition to the expansion plans
announced to date, to enhance Vametco's performance across the
production process. We expect to see the positive effects of these
initiatives in the coming year.
"Key to the success of our efforts at Vametco is a healthy
cooperative relationship with all of our stakeholders, not least
the local communities in which we operate and the workers. The
recent unprotected strike action at the mine, while unfortunate
only underscores the importance of us succeeding in this objective.
We are pleased that we were able to reach a resolution with the
workers and delighted that they will participate in the success of
the Company through an Employee Share Options Scheme Structure.
"Meanwhile our efforts in building a leading energy storage
company through Bushveld Energy are progressing well on all fronts,
the construction of the electrolyte manufacturing plant in South
Africa, the deployment of a VRFB at Eskom, securing mandates for
large scale VRFB deployments as well as the development of vanadium
electrolyte leasing products to promote the adoption of VRFBs in
the global energy storage industry. The grant of US$500,000
received from the Government of the United States of America will
go a long way to fund the implementation and enhancement of the
Eskom Vanadium Redox Flow Batteries project. The commissioning
delay experienced with the Eskom Vanadium Redox Flow Batteries
project has meant the new battery is now expected to be
commissioned during the Q4 2018.
"The signing of a 30-year Project Concession Agreement between
Lemur Holdings and the Government of Madagascar is a critical
milestone in the development of Lemur's integrated coal-to-power
project, bringing it even closer to implementation.
"As we continue to steadily execute our firm strategy to grow
into a significant, low-cost vertically integrated vanadium
platform, we have a busy pipeline of corporate and operational
activities ahead. I look forward to providing further updates on
the operations in the second half of the year.
"Finally, we are pleased to see the South Africa government move
to clear regulatory uncertainty around the South Africa's Mining
Charter bringing much needed clarity and direction for
investors."
Enquiries: info@bushveldminerals.com
Bushveld Minerals +27 (0) 11 268 6555
Fortune Mojapelo, Chief Executive
Officer
Chika Edeh, Head of Investor
Relations
SP Angel Corporate Finance
LLP Nominated Adviser & Broker +44 (0) 20 3470 0470
Ewan Leggat
Richard Morrison
Alternative Resource Capital Joint Broker
Rob Collins +44 (0) 207 186 9001
Alex Wood +44 (0) 207 186 9004
Tavistock Financial PR
Charles Vivian / Gareth Tredway +44 (0) 207 920 3150
Lifa Communications Financial PR (South Africa)
Gabriella von Ille +27 (0) 711 121 907
--
ABOUT BUSHVELD MINERALS LIMITED
Bushveld Minerals is a low cost, integrated, primary vanadium
producer, with ownership of high grade vanadium assets.
The Company's flagship vanadium platform includes a 75 per cent
controlling interest in Bushveld Vametco Alloys (Pty) Ltd, a
primary vanadium mining and processing company; the Mokopane
Vanadium Project and the Brits Vanadium Project.
Bushveld's vision is to become a significant, low cost,
integrated primary vanadium producer through owning high grade
assets. This incorporates development and promotion of the role of
vanadium in the growing global energy storage market through
Bushveld Energy, the Company's energy storage solutions provider.
Whilst the demand for vanadium remains largely anchored in the
steel industry, Bushveld Minerals believes there is strong
potential for an imminent and significant global vanadium demand
surge from the fast-growing energy storage market, particularly
through the use and adoption of Vanadium Redox Flow Batteries.
While the Company's focus is on vanadium operations and the
development and promotion of VRFBs, it has additional investments
in coal, power and tin.
The coal platform comprises the wholly-owned Imaloto Coal
Project, which is being developed as one of Madagascar's leading
independent power producers. The Company's tin interests are held
through its shareholding in AIM listed AfriTin Mining Limited.
The Company's approach to project development recognises that,
whilst attractive project economics are imperative, they are
insufficient to secure capital to bring them to account. A clear
path to production within a visible timeframe, low capital
expenditure requirements and scalability are important factors in
ensuring a positive return on investment. This philosophy is core
to the Company's strategy in developing projects. Detailed
information on the Company and progress to date can be accessed on
the website www.bushveldminerals.com
Consolidated Income Statement
For the six months ended 30 June 2018
6 Months ended 6 Months ended 10 Months
ended
30 June 2018 30 June 2017 31 December
2017
(unaudited) (unaudited) (audited)
GBP GBP GBP
Continuing operations
Revenue 62,069,509 - 2,210,430
Cost of sales (24,030,309) - (1,093,443)
Gross profit 38,039,200 - 1,116,987
Other operating income 3,445,271 - -
Selling and distribution
costs (3,831,079) - (220,724)
Other mine operating costs (814,098) - (122,707)
Idle plant costs (405,146) - (24,216)
Administration expenses (5,165,521) (43,202) (3,740,558)
Operating profit/(loss) 31,268,627 (43,202) (2,991,218)
Share of results of associate - 1,083,019 3,610,066
Impairment loss on demerger
of tin assets - - (547,441)
Finance income 813,323 19,099 107,045
Finance costs (1,348,493) - (863,035)
Profit / (loss) before tax 30,733,457 1,058,916 (684,583)
Taxation (9,588,550) - (8,144)
Profit / (loss) after taxation 21,144,907 1,058,916 (692,727)
Attributable to:
Owners of the parent 11,198,436 1,058,916 (953,358)
Non-controlling interests 9,946,471 - 260,811
============== ============== =============
Profit / (loss) per ordinary share
(note 4)
Basic and diluted profit / (loss)
per share (in pence) 1.14 0.26 (0.12)
All results relate to continuing activities.
Consolidated Statement of Comprehensive Income
For the six months ended 30 June 2018
6 Months ended 6 Months ended 10 Months ended
30 June 2018 30 June 2017 31 December
GBP GBP 2017
GBP
(unaudited) (unaudited) (audited)
Profit/(loss) for the
period / year 21,144,907 1,058,916 (692,727)
Other comprehensive
income, net of tax:
Items that may be subsequently
reclassified to profit
or loss:
Currency translation
differences (7,995,163) (305,694) 1,354,597
Available-for-sale financial
assets - net change
in fair value 205,145 - (779,930)
Total comprehensive
income for the period
/ year 13,354,889 753,222 (118,060)
=============== ================== ===================
Attributable to:
Owners of the parent 7,892,739 753,222 (327,272)
Non-controlling interests 5,462,150 - 209,212
Total comprehensive
income for the period
/ year 13,354,889 753,222 (118,060)
=============== ================== ===================
Consolidated Statement of Financial Position
As at 30 June 2018
Company number: 54506
30 June 2018 30 June 2017 31 December 2017
Note GBP GBP GBP
(unaudited) (unaudited) (audited)
Assets
Non-current assets
Intangible assets:
exploration and evaluation 5 43,387,123 60,397,078 45,110,207
Property, plant and
equipment 6 35,323,848 304,910 32,922,605
Investment properties 2,255,524 - 2,448,489
Deferred tax asset 2,536,647 - 2,427,455
Total Non-Current
assets 83,503,142 60,701,988 82,908,756
Current assets
Inventories 7 12,023,125 - 12,727,444
Trade and other receivables 8 17,906,049 6,633,573 10,286,266
Restricted investment 4,059,340 - 3,844,454
Income tax receivable - - 862,162
Available-for-sale
financial assets 1,429,771 - 1,224,626
Cash and cash equivalents 9 26,176,707 71,544 7,218,820
Total Current assets 61,594,992 6,705,117 36,163,772
Total assets 145,098,134 67,407,105 119,072,528
============ ============ ================
Equity and liabilities
Share capital 12 10,760,245 8,065,153 8,758,948
Share premium 12 68,082,937 62,091,768 51,306,449
Accumulated profit/(deficit) 1,473,104 (6,893,429) (9,725,332)
Warrant reserve 2,196,180 594,127 1,566,755
Foreign exchange translation
reserve (2,116,253) 294,087 1,394,589
Fair value reserve (574,785) - (779,930)
------------ ------------ ----------------
Equity attributable
to owners of the parent 79,821,428 64,151,706 52,521,479
Non-controlling interests 32,431,445 2,058,010 26,969,295
Total Equity 112,252,873 66,209,716 79,490,774
Non-Current liabilities
Borrowings 11 - - 5,815,092
Other financial liabilities - - 1,012,490
Post-retirement medical
liability 1,874,944 - 2,063,042
Environmental rehabilitation
liability 4,670,671 - 4,943,249
Deferred consideration 8,717,393 - 8,167,393
Total Non-Current
liabilities 15,263,008 - 22,001,266
Current liabilities
Trade and other payables 10 11,222,372 1,197,389 15,007,199
Provisions 6,359,881 - 2,573,289
Total Current liabilities 17,582,253 1,197,389 17,580,488
Total Equity and liabilities 145,098,134 67,407,105 119,072,528
============ ============ ================
Consolidated Statement of Changes in Equity
For the six months ended 30 June 2018
Attributable to owners of the parent company
Foreign Fair Non-
Share Share Accumulated Warrant translation value controlling Total
capital premium deficit reserve reserve reserve Total interests equity
GBP GBP GBP GBP GBP GBP GBP GBP GBP
Total equity at 1 January
2017 (unaudited) 6,839,087 61,177,827 (7,658,258) 594,127 (11,607) 60,941,176 2,079,259 63,020,435
---------------------------- ---------- ------------ ----------- ---------- ----------- --------- ------------ ----------- ------------
Profit for the period - - 1,058,916 - - - 1,058,916 - 1,058,916
Other comprehensive income:
Currency translation
differences - - (294,087) - 305,694 - 11,607 - 11,607
Total comprehensive income
for the period - - 764,829 - 305,694 - 1,070,523 - 1,070,523
Transactions with owners:
Issue of shares 1,226,066 1,340,121 - - - - 2,566,187 - 2,566,187
Share issue expenses - (426,180) - - - - (426,180) - (426,180)
Non-controlling interest - - - - - - - 305,694 305,694
Total equity at 30 June
2017 (unaudited) 8,065,153 62,091,768 (6,893,429) 594,127 294,087 - 64,151,706 2,384,953 66,536,659
---------------------------- ---------- ------------ ----------- ---------- ----------- --------- ------------ ----------- ------------
Loss for the period - - (2,831,903) - - - (2,831,903) - (2,831,903)
Other comprehensive income:
Fair value movement on
investments - - - - - (779,930) (779,930) - (779,930)
Currency translation
differences - - - - 1,100,502 - 1,100,502 21,249 1,121,751
---------------------------- ---------- ------------ ----------- ---------- ----------- --------- ------------ ----------- ------------
Total comprehensive loss
for the period - - (2,831,903) - 1,100,502 - (2,511,331) 21,249 (2,490,082)
Transactions with owners
Grant of warrants - - - 972,628 - - 972,628 - 972,628
Issue of shares 693,795 5,362,681 - - - - 6,056,476 - 6,056,476
Distribution of capital
on de-merger - (16,148,000) - - - - (16,148,000) - (16,148,000)
Non-controlling interest - - - - - - - 24,563,093 24,563,093
---------------------------- ---------- ------------ ----------- ---------- ----------- --------- ------------ ----------- ------------
Total equity at 31 December
2017
(audited) 8,758,948 51,306,449 (9,725,332) 1,566,755 1,394,589 (779,930) 52,521,479 26,969,295 79,490,774
Profit for the period - - 11,198,436 - - - 11,198,436 9,946,471 21,144,907
Other comprehensive income:
Fair value movement on
investments - - - - - 205,145 205,145 - 205,145
Currency translation
differences - - - - (3,510,842) - (3,510,842) (4,484,321) (7,995,163)
Total comprehensive income
for the period - - 11,198,436 - (3,510,842) 205,145 7,892,739 5,462,150 13,354,889
Transactions with owners
Grant of warrants - - - 629,425 - - 629,425 - 629,425
Issue of shares 2,001,297 17,577,082 - - - - 19,578,379 - 19,578,379
Share issue costs - (800,594) - - - - (800,594) - (800,594)
Non-controlling interest - - - - - - - - -
Total equity at 30 June
2018 (unaudited) 10,760,245 68,082,937 1,473,104 2,196,180 (2,116,253) (574,785) 79,821,428 32,431,445 112,252,873
---------------------------- ---------- ------------ ----------- ---------- ----------- --------- ------------ ----------- ------------
Consolidated Statement of Cash Flows
For the six months ended 30 June 2018
6 Months ended 6 Months ended 10 Months ended
30 June 2018 30 June 2017 31 December
GBP GBP 2017
GBP
(unaudited) (unaudited) (audited)
PROFIT/(LOSS) AFTER TAXATION 21,144,907 1,058,916 (692,727)
Adjustments for:
Depreciation property, plant
and equipment 462,565 3,725 50,369
Impairment loss on de-merger - - 547,472
Finance income (813,323) (19,099) (107,045)
Finance costs 1,348,493 - 863,035
Share of profit in associate - (1,083,019) (3,610,066)
Changes in working capital (6,268,188) (750,510) (1,144,094)
------------------- --------------------
Net cash generated from/(used
in) operating activities 15,874,454 (789,987) (4,093,056)
------------------- --------------------
Cash flows from investing
activities
Finance income 813,323 19,099 107,045
Purchase of exploration
and evaluation assets (15,244) (475,897) (1,261,590)
Purchase of property, plant
and equipment (4,488,101) (21,249) -
Net cash impact of acquisition
of Bushveld Vametco Limited - - 4,412,912
Net cash (used in)/generated
from investing activities (3,690,022) (478,047) 3,258,367
------------------- --------------------
Cash flows from financing
activities
Finance costs (1,348,493) - -
Net proceeds of capital
raise 15,279,790 - -
Net proceeds from issue
of shares and warrants 1,170,213 1,916,187 1,691,011
Proceeds from convertible
bond issue (net of repayments) - - 6,545,000
Net repayments of other
borrowings (5,115,906) - (128,767)
------------------- --------------------
Net cash generated from
financing activities 9,985,604 1,916,187 8,107,244
------------------- --------------------
Net increase in cash and
cash equivalents 22,170,036 648,153 7,272,555
Cash and cash equivalents
at the beginning of the
period 7,218,820 131,155 131,155
Effect of foreign exchange
rates (3,212,149) (707,764) (184,890)
Cash and cash equivalents
at end of the period 26,176,707 71,544 7,218,820
=================== ====================
1. Corporate information and principal activities
Bushveld Minerals Limited ("Bushveld") was incorporated and
domiciled in Guernsey on 5 January 2012 and admitted to the AIM
market in London on 26 March 2012.
The company changed its reporting date from 28 February to 31
December during the prior period. These unaudited interim financial
statements are for the six months 30 June 2018 with comparatives to
30 June 2017. The ten months to 31 December 2017 are audited.
2. Basis of preparation
The results presented in this report are unaudited and they have
been prepared in accordance with the recognition and measurement
principles of International Financial Reporting Standards ('IFRS")
as adopted by the EU that are expected to be applicable to the next
set of financial statements and on the basis of the accounting
policies to be used in those financial statements.
The interim financial information does not include all of the
information required for full annual financial statements and
accordingly, whilst the interim financial information has been
prepared in accordance with the recognition and measurement
principles of IFRS, it cannot be construed as being in full
compliance with IFRS. The financial information contained in this
announcement does not constitute statutory accounts as defined by
the Companies (Guernsey) Law 2008.
The audited financial information for the period ended 31
December 2017 is based on the statutory accounts for the financial
period ended 31 December 2017. The auditors reported on those
accounts: their report was unqualified and did not contain
statements where the auditor is required to report by
exception.
The directors do not believe that the adoption of new standards,
including IFRS 9 and IFRS 15,will have a material impact on the
reported results.
3. Use of estimates and judgements
In the application of the group's accounting policies, the
directors are required to make judgements, estimates and
assumptions about the carrying amounts of assets and liabilities
that are not readily apparent from other sources. The estimates and
associated assumptions are based on historical experience and other
factors that are considered to be relevant. Actual results may
differ from these estimates in particular, information about
significant areas of estimation uncertainty considered by
management in preparing the financial statements is described
below:
i. Decommissioning and rehabilitation obligations
Estimating the future costs of environmental and rehabilitation
obligations is complex and requires management to make estimates
and judgements as most of the obligations will be fulfilled in the
future and contracts and laws are often not clear regarding what is
required. The resulting provisions are further influenced by
changing technologies, political, environmental, safety, business
and statutory considerations.
ii. Asset lives and residual values
Property, plant and equipment are depreciated over its useful
life taking into account residual values, where appropriate. The
actual lives of the assets and residual values are assessed
annually and may vary depending on a number of factors. In
reassessing asset lives, factors such as technological innovation,
product life cycles and maintenance programmes are taken into
account. Residual value assessments consider issues such as future
market conditions, the remaining life of the asset and projected
disposal values.
iii. Post-retirement employee benefits
Post-retirement medical aid liabilities are provided for certain
existing employees. Actuarial valuations are based on assumptions
which include employee turnover, mortality rates, the discount
rate, health care inflation costs and rates of increase in
costs.
iv. Surface rights liabilities
The group has provided for surface lease costs that would accrue
to the owners of the land on which the mine is built. The quantum
of the amounts due post implementation of the MPRDA and the
granting of the new order mining right to the group is somewhat
uncertain and need to be negotiated with such owners. The group has
conservatively accrued for possible costs in this regard, but the
actual obligation may be materially different when negotiations
with the relevant parties are completed.
v. Impairment of exploration and evaluation assets
Determining whether an exploration and evaluation asset is
impaired requires an assessment of whether there are any indicators
of impairment, including by reference to specific impairment
indicators prescribed in IFRS 6 - Exploration for and Evaluation of
Mineral Resources. If there is any indication of potential
impairment, an impairment test is required based on value in use of
the asset. The valuation of intangible exploration assets is
dependent upon the discovery of economically recoverable deposits
which, in turn, is dependent on future of Ferro Vanadium prices,
future capital expenditures and environmental and regulatory
restrictions. The directors have concluded that there are no
indications of impairment in respect of the carrying value of
intangible assets at 31 December 2017 based on planned future
development of the projects and current and forecast commodity
prices.
4. Profit/Loss per share
From continuing operations
The calculation of a basic profit per share of 1.14 pence
(December 2017: 0.12 pence loss), is calculated using the total
profit for the six months attributable to the owners of the company
of GBP11,198,436 (December 2017: GBP953,538) and the weighted
average number of shares in issue during the six months of
985,904,707 (December 2017: 789,578,440). The dilutive effect of
other shares in issue would be immaterial to the profit per
share.
5. Intangible exploration and evaluation assets
Vanadium
and Iron Tin Total
ore GBP GBP
GBP
As at 1 January 2017 41,653,048 18,268,133 59,921,181
-------------------------- ------------ ------------- -------------
Additions to 30 June
2017 475,897 - 475,897
-------------------------- ------------ ------------- -------------
As at 30 June 2017
(unaudited) 42,128,945 18,268,133 60,397,078
Exchange differences 1,719,672 (1,572,661) 147,011
Additions to 31 December
2017 1,261,590 - 1,261,590
Impairment/loss on
disposal - (16,695,472) (16,695,472)
-------------------------- ------------ ------------- -------------
As at 31 December
2017 (audited) 45,110,207 - 45,110,207
Additions to June
2018 15,244 - 15,244
Exchange differences (1,738,328) - (1,738,328)
-------------------------- ------------ ------------- -------------
As at 30 June 2018
(unaudited) 43,387,123 - 43,387,123
-------------------------- ------------ ------------- -------------
The Company's subsidiary, Bushveld Resources Limited has a 64%
interest in Pamish Investment No 39 (Proprietary) Limited
("Pamish") which holds an interest in Prospecting right 95 ("Pamish
39"). Bushveld Resources Limited also has a 68.5% interest in
Amaraka Investment No 85 (Proprietary) Limited ("Amaraka") which
holds an interest in Prospecting right 438 ("Amaraka 85").
Under the agreements to acquire the licences within Bushveld
Resources, the group is required to fully fund the exploration
activities up to the issue of the corresponding mining licences. As
the non-controlling interest party retains their equity interest,
the funding of their interest is accounted as deemed purchase
consideration and is included in the additions in the year to
exploration activities. A corresponding increase is credited to
non-controlling interest.
Brits Vanadium Project
The Company is in a process to secure regulatory approval in
terms of section 11 of the Mineral and Petroleum Resources
Development Act (MPRDA) for change of control in respect of the
acquired Sable Metals & Mining Ltd.'s subsidiaries. Following
approval, Bushveld Minerals will commence with activities to
delineate the shallow resource on the Uitvalgrond farm portion.
-- NW 30/5/1/1/2/11069 PR - held through Great Line 1 (Pty) Ltd
-- NW 30/5/1/1/2/11124 PR - held through Great Line 1 (Pty) Ltd
-- GP 30/5/1/1/02/10142 PR - held through Gemsbok Magnetite (Pty) Ltd
6. Property, plant and equipment
Buildings Plant and Motor Decommissioning Assets under Total
and other machinery vehicles assets construction
improvements furniture
and
equipment
GBP GBP GBP GBP GBP
Cost at 1
January 2017
and 30 June
2017 - 750,921 - - - 750,921
Disposals - (301,185) - - - (301,185)
Additions due
to
acquisition 452,703 30,606,619 21,249 1,116,965 692,541 32,890,077
Exchange
differences - 182,448 - - - 182,448
----------------------- -------------------- -------------------- -------------------------- ----------------------- ----------------
At 31
December
2017
(audited) 452,703 31,238,803 21,249 1,116,965 692,541 33,522,261
======================= ==================== ==================== ========================== ======================= ================
Additions to
30 June 2018 - - 225,192 - 4,262,909 4,488,101
Assets under
construction
capitalised - 88,309 - - (88,309) -
Exchange
differences - (1,624,293) - - - (1,624,293)
======================= ==================== ==================== ========================== ======================= ================
At 30 June
2018
(unaudited) 452,703 29,702,819 246,441 1,116,965 4,867,141 36,386,069
======================= ==================== ==================== ========================== ======================= ================
Depreciation
1 January
2017 - 442,286 - - - 442,286
Charged for
six months
to 30 June
2017 - 3,725 - - - 3,725
Exchange - - - - - -
differences
----------------------- -------------------- -------------------- -------------------------- ----------------------- ----------------
At 30 June
2017
(unaudited) - 446,011 - - - 446,011
======================= ==================== ==================== ========================== ======================= ================
Charge for
the six
months
to 31
December
2017 - 50,369 - - - 50,369
Exchange
differences - 103,274 - - - 103,274
----------------------- -------------------- -------------------- -------------------------- ----------------------- ----------------
At 31
December
2017
(audited) - 599,656 - - - 599,656
======================= ==================== ==================== ========================== ======================= ================
Charge for
the six
months
to 30 June
2018 54,602 323,988 83,975 - - 462,565
Exchange - - - - - -
differences
----------------------- -------------------- -------------------- -------------------------- ----------------------- ----------------
At 30 June
2018
(unaudited) 54,602 923,644 83,975 - - 1,062,221
======================= ==================== ==================== ========================== ======================= ================
Net book
value 30
June
2018
(unaudited) 398,101 29,779,175 162,466 1,116,965 4,867,141 35,323,848
======================= ==================== ==================== ========================== ======================= ================
Net book
value 31
December
2017
(audited) 452,703 30,639,147 21,249 1,116,965 692,541 32,922,605
======================= ==================== ==================== ========================== ======================= ================
Net book
value 30
June
2017
(unaudited) - 304,910 - - - 304,910
======================= ==================== ==================== ========================== ======================= ================
7. Inventories
30 June 2018 30 June 2017 31 December
GBP GBP 2017
GBP
Unaudited Unaudited Audited
Finished goods 4,287,521 - 4,800,578
Work in progress 3,008,165 - 3,255,013
Raw materials 1,660,681 - 1,198,704
Consumable stores 3,066,758 - 3,473,149
------------ ----------------- ----------------
Inventories 12,023,125 - 12,727,444
============ ================= ================
The amount of write-down of inventories due to net realisable
value provision requirement is nil.
8. Trade and other receivables
30 June 2018 30 June 2017 31 December
GBP GBP 2017
GBP
Unaudited Unaudited Audited
Trade receivables 11,181,598 2,513,256 6,136,121
Other receivables 6,724,451 4,120,317 4,150,145
---------------------- --------------------- -------------------
Trade and other
receivables 17,906,049 6,633,573 10,286,266
====================== ===================== ===================
Trade receivables are non-interest bearing and are generally on
15-90 day terms. There were no indicators of impairment at 30 June
2018. At 30 June 2018 the group had one customer which accounted
for approximately 90% of trade receivables.
9. Cash and cash equivalents
30 June 2018 30 June 2017 31 December
GBP GBP 2017
GBP
(unaudited) (unaudited) (audited)
Cash at hand and
in bank 26,176,707 71,544 7,218,820
====================== ================== ================
Cash and cash equivalents (which are presented as a single class
of assets on the face of the Statement of Financial Position)
comprise cash at bank and other short-term highly liquid
investments with an original maturity of three months or less. The
directors consider that the carrying amount of cash and cash
equivalents approximates their fair value.
10. Trade and other payables
30 June 2018 30 June 2017 31 December
GBP GBP 2017
GBP
(unaudited) (unaudited) (audited)
Trade payables 6,347,003 298,914 8,059,604
Other payables 2,955,871 83,275 4,729,604
Accruals 1,919,498 815,200 2,217,991
--------------------- ------------------- ----------------
11,222,372 1,197,389 15,007,199
===================== =================== ================
Trade and other payables principally comprise amounts
outstanding for trade purchases and on-going costs. The average
credit year taken for trade purchases is 30 days.
11. Borrowings
Since December 2017 the outstanding convertible bonds balance
was reduced by the following conversions:
-- GBP250,000 of convertible bonds converted into 3,078,817
ordinary shares of 1 pence each of the Company at a conversion
price of 8.12 pence each on 18 January 2018. Following the
exercise, Atlas held a total of GBP6,700,000 Convertible Bonds;
-- GBP700,000 of convertible bonds converted into 8,620,689
ordinary shares of 1 pence each of the Company at a conversion
price of 8.12 pence each on 23 January 2018. Following the
exercise, Atlas held a total of GBP6,000,000 Convertible Bonds;
-- GBP1,000,000 of convertible bonds converted into 11,990,407
ordinary shares of 1 pence each of the Company at a conversion
price of 8.34 pence each on 19 February 2018. Following the
exercise, Atlas held a total of GBP5,000,000 Convertible Bonds;
-- GBP725,000 of convertible bonds converted into 8,809,234
ordinary shares of 1 pence each of the Company at a conversion
price of 8.23 pence each 14 March 2018. Following this exercise,
Atlas held a total of GBP4,275,000 Convertible Bonds.
On 14 June 2018, Bushveld fully redeemed the issued Convertible
Bonds. The Convertible Bonds were settled in full for a final
aggregate cash payment of GBP5.116 million, including interest and
early redemption charges.
12. Share capital and share premium
Number of
shares issued Nominal value Total share capital
and fully Issue price of shares of Share and premium
paid Per share 1 pence each premium GBP
GBP GBP GBP GBP
Balance at 1
January 2017
(audited) 683,908,870 6,839,087 61,177,827 68,016,914
Warrants
exercised
January to June
2017 3,866,667 0.05 38,667 19,333 58,000
Warrants
exercised
January to June
2017 4,833,333 0.018 48,333 38,667 87,000
Warrants
exercised
January to June
2017 67,549,458 0.024 675,495 945,692 1,621,187
Warrants
exercised
January to June
2017 5,357,143 0.028 53,571 96,429 150,000
Shares issued for
Uis Transaction 41,000,000 0.016 410,000 240,000 650,000
Share issue
expenses (426,180) (426,180)
Balance at 30
June 2017
(unaudited) 806,515,471 8,065,153 62,091,768 70,156,921
-------------- ------------- --------------- ------------ ---------------------
Balance brought
down 1 July 2017 806,515,471 8,065,153 62,091,768 70,156,921
Warrants
exercised July
to December 2017 470,886 0.024 4,710 6,591 11,301
Warrants
exercised July
to December 2017 652,000 0.045 6,520 22,820 29,340
Warrants
exercised July
to December 2017 434,000 0.068 4,340 25,172 29,512
50,000
convertible
bonds converted
October 540,540 0.0925 5,405 44,595 50,000
1,000,000
convertible
bonds converted
December 12,515,644 0.0799 125,156 874,844 1,000,000
Shares issued on
acquisition 54,766,364 0.091 547,664 4,388,658 4,936,322
Distribution of
capital on
de-merger
Afritin (16,148,000) (16,148,000)
Balance at 31
December 2017
(audited) 875,894,905 8,758,948 51,306,449 60,065,397
-------------- ------------- --------------- ------------ ---------------------
Balance brought
down 1 January
2018 875,894,905 8,758,948 51,306,449 60,065,397
Warrants exercised January to June 2018 190,638 0.024 1,905 2,669 4,574
950,000 convertible bonds converted January
2018 11,699,506 0.0812 116,995 833,005 950,000
1,000,000 convertible bonds converted
February
2018 11,990,407 0.0834 119,904 880,096 1,000,000
725,000 convertible bonds converted March
2018 8,809,234 0.0823 88,092 636,908 725,000
Capital raise and placing 26 March 2018 152,749,172 0.103 1,527,492 14,205,673 15,733,165
Darwin warrants exercised April 2018 3,039,473 0.079 30,396 209,725 240,120
Darwin warrants exercised April 2018 4,052,631 0.099 40,526 360,684 401,210
Wogan warrants exercised May 2018 7,598,684 0.069 75,987 448,322 524,309
Share issue expenses (800,594) (800,594)
Balance at 30 June 2018 (unaudited) 1,076,024,650 10,760,245 68,082,937 78,843,182
------------- ------ ---------- ---------- ----------
The Board may, subject to Guernsey Law, issue shares or grant
rights to subscribe for or convert securities into shares. It may
issue different classes of shares ranking equally with existing
shares. It may convert all or any classes of shares into redeemable
shares. The Company may also hold treasury shares in accordance
with the law. Dividends may be paid in proportion to the amount
paid up on each class of shares.
As at the 30 June 2018 the Company owns 670,000 (30 June 2017
and 31 December 2017: 670,000) treasury shares with a nominal value
of 1 penny.
On 26 March 2018, the Company raised approximately US$22.2
million (GBP15.7 million) (before expenses) by way of an
oversubscribed placing of 152,749,172 new ordinary shares of 1
penny each at a price of 10.3 pence per share with leading
institutional and mining investors (the "Placing"). The price was
calculated as the 5 day volume weighted average price (as published
by Bloomberg) at close of trading Monday 19 March 2018. The Placing
shares represented approximately 14.4% of the Company's issued
share capital on admission.
13. Events after the reporting period
On 6 July 2018, the Company received an exercise notice for the
exercise of warrants over 4,000,000 ordinary shares of 1 pence each
("Ordinary Shares") with an exercise price of 6.9 pence per
Ordinary Share. Accordingly, 4,000,000 new Ordinary Shares have
been issued. The new Ordinary Shares rank pari passu with the
Company's existing Ordinary Shares.
On 6 July 2018, the Company received an exercise notice for the
exercise of warrants over 5,000,000 ordinary shares of 1 pence each
("Ordinary Shares") with an exercise price of 13.84 pence per
Ordinary Share. Accordingly, 5,000,000 new Ordinary Shares have
been issued. The new Ordinary Shares rank pari passu with the
Company's existing Ordinary Shares.
On 8 August 2018, the issue and allotment of 24,847,310 new
ordinary shares of 1 pence each to be issued to certain directors,
senior employees and advisors of the Company (the "Compensation
Shares") was approved. Accordingly, 24,847,310 new Ordinary Shares
have been issued. The new Ordinary Shares rank pari passu with the
Company's existing Ordinary Shares.
On 13 September 2018 the Group completed the acquisition of a
21.22 per cent interest in Strategic Minerals Corporation ("SMC"),
an intermediate holding company of Vametco Alloys Proprietary
Limited, "Vametco") from Sojitz Noble Alloys Corporation ("Sojitz")
for a total cash consideration of US$20,000,000 (the
"Acquisition"). On completion of the Acquisition, Bushveld
increased its indirect beneficial interest in Vametco from 59.1 per
cent to 75 per cent.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IR LFMATMBATMMP
(END) Dow Jones Newswires
September 26, 2018 02:01 ET (06:01 GMT)
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