TIDMALTN
Altyn Plc
("Altyn" or the "Company")
Results for the year ended 31 December 2017
Altyn Plc (LSE:ALTN) an exploration and development company, is
pleased to announce its results for the year ended 31 December
2017.
Highlights
Underground development & exploration
* The transport decline was taken from the developmental level
of 225masl down to 150masl.
* Access portal, for the second transport decline was completed
during H2 2017.
* The processing plant was overhauled involving a number of
replacement parts/equipment, to ensure efficient working at higher
volume levels.
* Capital investment of US$2.6m (2016: US$5.6m) which included a
new load-haul-dumper (LHD), and drilling machine at
Sekisovskoye.
* Exploration work continued on the prospective Karasuyskoye
site with extensive drilling in a number of areas on the site in
order to better define the ore bodies and grade content.
Financial highlights
* Turnover increased in the year to US$21.6m (2016:
US$15.9m).
* 16,747oz of gold sold (2016: 12,602oz), an increase of
4,145oz.
* Average gold price achieved (including silver as a by-
product), US$1,293oz, (2016: US$1,259oz).
* Adjusted EBITDA (Earnings before interest, tax, depreciation
and amortisation and excluding impairment) of US$3.6m (2016:
US$260,000).
* EBRD loan was repaid in the year, in the current year capital
and interest amounting to US$3.5m was repaid.
* In February 2018 the Company converted US$9.7m of the US$10m
bond issued to African Resources into 233,333,333 new ordinary
shares. It is the intention to convert the remaining shares and
interest into ordinary shares in Q3 2018.
Operational highlights
* Gold poured 16,717oz, (2016: 10,970oz) a 52.4% increase
year-on-year, the production was constrained by the closure of the
processing plant for maintenance and availability of the necessary
equipment.
* Operating cash cost US$774/oz, (2016: US$846/oz).
* Gold recovery rate 83.54% (2016: 80.20%) improvements in
processing production techniques.
For further information please contact:
Altyn Plc
Rajinder Basra, CFO +44 (0) 207 932 2456
VSA Capital (Corporate Broker)
Andrew Monk / Andrew Raca +44 (0) 203 005 5000
CHAIRMAN'S STATEMENT
Dear shareholders,
We were expecting to be moving forward towards the targets set
in the prior year in terms of production, however our progress was
held back by the lack of equipment. Positive progress was made in
developing the underground mine in relation to the ore bodies and
infrastructure. However the lack of equipment had a direct effect
on the level of output and grade achieved.
During the year in order to move the project forward, which
requires capital investment, a great deal of work was done with
investment advisors and potential lenders. The potential offers
were carefully vetted and assessed to ensure that the finance to be
provided was the correct fit for the Company. This necessarily
involved additional time and resources and the time lines were
extended to those originally envisaged. The management are working
to ensure that the current funding being accessed for the required
investment in equipment is at a competitive price for the
shareholders and affordable for the Company. To this end they have
identified two sources that will provide the necessary funding
required to move the project forward, and are currently in the
final stages of confirming the funding.
During the year the Company maintained tight control of costs to
conserve working capital, with further savings being made in 2018
both at head office and at subsidiary Company level in Kazakhstan.
At Head Office the administrative costs have been reduced by
cutting office and professional fees. In the subsidiaries rent,
travel and other overheads have been reduced. In Q1 2018 these have
been further reduced. Employment costs have been reduced with a
rationalisation of the workforce principally at the mine site.
During the year the Company met its commitment to repay the
balance of the EBRD loan, which was settled in October 2017. The
consequent finance cash flows in relation to servicing of this debt
will prove useful in meeting its obligations on any new financial
liability.
The decline has now progressed down to 150masl, and a number of
ore bodies are now accessible to progress 2018 production.
We are confident from the work conducted so far that the mine
will generate a very good return to the shareholders. The
underground asset and infrastructure have been developed so that it
can deliver the production required, via the new range of equipment
to be purchased. This is expected to quickly transform the
productive capacity, and move towards the targeted output levels.
The recent drilling undertaken at Karasuyskoye has delivered
promising results and the Company are expecting to move the project
forward to the CPR stage in the near term.
I would like to thank the shareholders for their patience, as I
am aware that the gold price was trending up whilst our share price
was trending down. Based on the fundamentals and our understanding
of the asset we see the long-term future of the Company in a
positive light and the patience of shareholders will be
rewarded.
With the ore bodies ready for exploitation and infrastructure in
place including the refurbished processing plant. The additional
equipment will now provide the necessary feed stock to the
processing plant to see the results of all the hard work come to
fruition.
Finally, may I once again thank all our employees and our
Management team for their hard work, and we look forward to an
exciting and fruitful year ahead for Altyn.
Kanat Assaubayev
Chairman
30 April 2018
CHIEF EXECUTIVE OFFICER'S REVIEW
Overview
The Company is very close to securing the finance to purchase
the equipment necessary to increase the output from its current
levels to its initial target of 40,000t a month, moving to 70,000t
in 2019.
Infrastructure enhancements and progress of the underground
decline have been continuing in the year. This will provide a good
springboard for increasing the output once the available equipment
is in situ.
In terms of expected timelines the production is planned to
increase from Q3 2018, once the equipment is commissioned and
delivered.
Current developments
The following progress was achieved in developing the
underground mine in the year:
* Development of the decline was taken down to 150masl, this
gave access to ore bodies 10, 3-8 and ore body 5. There is no
further requirement in the short term to develop the decline as
this together with the original decline giving access to ore body
11, will provide sufficient mineable ore for the current planned
production.
* Ore bodies have continued to be prepared for production
however the lack of equipment has been a hindrance in this regard.
In addition it has been difficult to target the ore bodies in a
precise manner in order to extract the grade of ore as indicated by
the exploration drilling, resulting in a higher than expected
dilution in the grade.
* The actual overall processing grade achieved in the FY17 was
1.89 g/t (2016:1.66g/t . As explained this was due to two factors a
dilution issue and because lower grade ore stockpiled ore was mixed
with the higher-grade ore to maintain operational efficiency in the
processing plant. In the year the Company did not have the
necessary equipment for contouring and drilling the ore bodies in
order to maximise the extraction of the higher grade ore without
dilution. The underground ore grade fell to 2.08g/t from 2.70g/t in
2016. The expectation is that these issues will be settled once the
new equipment is in place.
* Refurbishment of the processing plant and the preparation of
the ore bodies together with the completion of tailings dam 4 in
early 2017, now allows for the rapid increase in production once
the equipment is in situ expected to be in Q3 2018. The tailings
dam will provide sufficient storage for at least three years.
* During the year the company purchased a LHD Fambition
(load-haul-dumper used to fill the underground trucks with ore),
and a prospect drilling machine, CSK Sondaj - C400 (used to define
and contour the ore bodies to target and extract the higher-grade
ores).
* In addition, the costs of exploration at Karasuyskoye were
capitalised in accordance with the accounting policy this amounted
approximately US$1.4m, (475mKzt), which was principally invoiced by
third party consultants to conduct detailed geological testing, and
project documentation.
Looking forward
* The decline was developed to the 150masl during the year
further development of the decline will be limited, as there is
sufficient access to the ore bodies at this level which can be
prepared for production. Ore body 11 contains on average
higher-grade ore and is expected to be mined during 2018.
* Preparatory works will be undertaken to include horizontal
shaft development to access ore bodies 3-8,5 and 10 down to this
level.
* With the new equipment to come on stream in Q3 2018 the
production is expected to increase from this point gradually
increasing to the run rate of 70,000t a month.
Capital requirements
An update to the current projected development capital
requirements is given in the table below.
Projected capital expenditures
underground operations
Total 2018 2019 2020
US$m US$m US$m US$m
Prospect drilling 3.7 0.7 1.5 1.5
Underground development 5.6 2.0 1.6 2.0
Infrastructure 3.4 3.4 - -
Ore handling facilities 19.2 12.0 4.9 2.3
Process plant & paste plant 8.6 1.7 4.5 2.4
Karasuyskoye - exploration 4.7 0.9 1.9 1.9
Contingency 3.5 2.1 0.7 0.7
Total 48.7 22.8 15.1 10.8
In summary part of the capex requirement was met in 2017 from
the Company's own resources of the total amount shown above the
external funding being sourced is in the range of US$30m - US$35m,
the balance will be funded from the Company's operations. The
Company has entered into an agreement with Freedom Finance to
assist in raising US$15m of the external funding requirement. The
Company is also in discussions with another party to provide direct
equipment financing. Taken together this will enable to Company to
progress its development plans.
Sekisovskoye operational update
The operational performance of the Company's Sekisovskoye gold
mine during 2017 against the prior year is shown in the tables
below.
Mining - open pit
2017 2016
Ore mined T - 107,586
Gold grade g/t - 0.91
Silver grade g/t - 1.60
Contained gold oz - 3,065
Contained silver oz - 5,361
Mining - underground
2017 2016
Ore mined T 287,389 100,763
Gold grade g/t 2.08 2.70
Silver grade g/t 2.80 3.76
Contained gold oz 19,243 8,757
Contained silver oz 25,909 12,182
Mining - processing
*2017 2016
Crushing T 332,502 258,206
Milling T 332,947 262,546
Gold grade g/t 1.88 1.66
Silver grade g/t 2.56 2.88
Gold recovery % 83.54 80.20
Silver recovery % 73.85 73.45
Contained gold oz 20,040 13,679
Contained silver oz 27,138 22,491
Gold poured oz 16,717 10,970
Silver poured oz 19,989 16,519
*The mining processing relates to nine months as the processing
plant was closed for three months for upgrade works.
In the year to December 2017, the ore mined has increased
substantially from last year, as extensive preparation work was
done on the ore bodies in the prior year and is continuing in to
the current year.
The underground gold grade is lower than in 2016, and has
dropped from 2.70 to 2.08, this is principally due to the lack of
currently available mining equipment to target the ore body in the
most efficient way. This led to a higher than anticipated dilution
and a lower grade of ore recovered, lower grade ore was being mined
from around the targeted ore zone. It is anticipated that the gold
grade will increase as more targeted drilling is undertaken once
the necessary equipment is available.
During the year the company gold mining grades ranged from a low
of 1.50 to a high in a particular month of 2.59. This was a
reflection of the amount of development ore that was included
within the ore mined. This is not an ideal situation and is
expected to be remedied as noted above as further drilling
equipment is deployed.
The mineral processing has increased significantly, however it
should be noted that the actual processing plant was closed for
three weeks for refurbishment in 2017. However there is a
significant uplift in production for the period which is
encouraging, moving up to 16,717oz of gold poured in comparison to
10,970 in the prior year. The gold production increased from H1 of
7,327oz to 9,390oz in H2, production will only build significantly
from this point once the new equipment is deployed.
We are very pleased with the recovery rate of 83.54% (2016
80.20%), the upgrades in the plant processing equipment and revised
working methodology has led to this improvement, and the recovery
rates are being maintained at current levels.
As in the prior year the processed ore was a mixture of lower
grade ore from the stock piles and the developmental ore from the
higher grade underground ore bodies. The ore grade was at a low
level from the stock piles and was only used in order to keep the
plant operational. This process of mixing the ores will be
discontinued once sufficient feed stock is generated from the
underground sources.
MARKET REVIEW AND SHARE PRICE PERFORMANCE
The share price of the Company has been trading at a low level,
and is a disappointment to the Directors, who are of the opinion it
does not reflect the true value and potential of the Company.
The Board has worked hard in order to ensure that the Company is
set up and restructured to be operationally efficient and to be
cost efficient. It has taken time to move to this stage, and the
next stage of development is dependent on further funding being
made available.
The current share range has seen a drop from the prior year and
is the region of 1.0-1.3p (2016: 1.5-2.0p). The Directors feel that
this is not a true reflection of the value of the Company and
expect the share price to improve significantly as production
improves and the potential of the Company is realised.
In addition to the current site which is producing at
Sekisovskoye, the Company is pressing ahead with the development of
the resources at Karasuyskoye. It is hoped that 2018 will see a
significant improvement in the share price as production and
profitability improves with a stable gold price. It is expected
that the gold price would continue to trade in the range
US$1,250-US$1,300 an ounce, similarly no significant impact is
expected in exchange rate fluctuations in the forthcoming year, the
Tenge is currently trading at 329 to the US Dollar.
FINANCIAL PERFORMANCE
Key performance indicators (KPIs)
Annual gold poured (oz)
16,717oz
2017 16,717
2016 10,970
2015 15,994
Revenue (US$m)
US$21.6m
2017 21.6
2016 15.9
2015 24.1
Cash production cost (US$oz)
US$774oz
2017 774
2016 832
2015 837
Adjusted EBITDA (US$m)
US$3.69m
2017 3.6
2016 0.3
2015 (2.3)
Net assets(US$m)
US$33.2m
2017 33.2
2016 34.0
2015 38.4
The gold poured increased to 16,717oz this is a significant
increase from last year. In terms of production and revenue
generation, there is expected to be a significant step up once the
Company is able to purchase further equipment. As the Company is
still in the process of obtaining the equipment it is expected this
will only have the effect of uplifting production significantly in
Q3 2018. However production with the current capex levels is also
budgeted to increase from 2017 levels, but not by a significant
amount. Gold prices are budgeted to remain stable at current
levels, and there Is not expected to be any change in the principal
customer purchasing the gold.
As in the prior year the company has made used of low grade ore
from that remaining in the stock piles this has again led to the
low levels of grade and recovery rates, as it was principally used
to maintain the operation of the processing plant at efficient
levels. As the low grade ore will be used in 2018 a write back has
been made to the profit and loss account of US$374,000, to reflect
the fact that this stock will be utilised in 2018.
The total cash cost of production, which includes administrative
costs but excludes depreciation and provisions, amounted to
US$1,075/oz, (2016: US$1,238oz). The operating cash cost amounts to
US$774/oz (2015: US$832/oz). This is based on the above but
excluding administrative expenses. The cash cost of production has
fallen as costs have been controlled in both consumables and the
number of workers used to generate the increased level of
production. As the level of production increases with tight control
over costs, it is anticipated that the cash cost of production will
continue to fall to the targeted level of US$540.
The Company has reported a net loss of US$1.9m (2016: US$6.4m),
with a gross profit of US$4.2m (2016: US$2.3m). The operational
loss is US$484,000 (2016: loss US$4.1m). The reduction in the loss
is a reflection of tighter production costs as noted above and
partly a result of head office savings, which are budgeted to
reduce further in 2018. In Q1 2018 the Company has also further
restructured the work force in Kazakhstan by outsourcing the
transportation department and reducing the building/maintenance
department. The EBITDA is US$3.6m, after adjusting the operating
loss of US$484,000 2016:US$4.1m) for depreciation of US$4.5m
(2016:US$3.3m), and impairment gain of US$374,000
(2016:lossUS$1.1m)
During 2017, the Company sold 16,747oz of gold (2016 12,602oz).
The average price achieved per oz in 2017 was US$1,293 similar to
last year, which achieved an average price of US$1,259. The prices
are budgeted to stay at similar levels in 2018, and there are no
changes anticipated to the sales offtake agreement currently in
place to the Kazakh national refinery.
The current cash position and anticipated trading is sufficient
for the budgeted capex (with no expansion), and budgeted production
for the next year, The principal shareholders have agreed to
provide monetary support as necessary, in order to provide any
short term financing that may be.
Cash at year-end was US$704,000 (2016: US$2.2m). resources are
sufficient to meet the current working capital requirements. The
Company generate an EBITDA of US$3.6m. Financing commitments can be
met from the cash generation of the Company, and are expected to be
at a reduced level from the prior year, being principally interest
commitments on the US$2m convertible loan and repayment of short
term borrowings, in total these are expected to amount to
approximately US$1m in 2018. The principal shareholders have agreed
to defer any loan repayments, in addition it is anticipated that
the remaining amounts due under the convertible bond due to African
Resources to include accrued interest will be converted into new
ordinary shares in Q3 2018.
As stated in the CEO report the Company is in the final stages
of obtaining the finance to purchase further capital equipment in
order to increase the processing output. Until this is in place
costs including further capital investment will be kept at low
levels and it is budgeted to be in line with 2017 at approx. US$3m,
to include further exploratory work at the Karasuyskoye site.
The consolidated net assets of the Company are US$33.2m 2016:
US$33.9m, no significant changes from the prior year.
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
year ended 31 December 2017
Notes 2017 2016
US$000 US$000
Revenue 3 21,649 15,867
Cost of sales (17,470) (13,554)
Gross profit 4,179 2,313
Administrative expenses (5,037) (5,352)
Impairments - reversed/(Impairment) 374 (1,107)
Operating loss (484) (4,146)
Foreign exchange (52) 283
Finance expense (1,381) (2,215)
Loss before taxation 4 (1,917) (6,078)
Taxation (charge)/credit (12) (278)
Loss attributable to equity (1,929) (6,356)
holders of the parent
Loss per ordinary share
Basic & diluted (0.08c) (0.3c)
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
year ended 31 December 2017
2017 2016
US$000 US$000
Loss for the year (1,929) (6,356)
Currency translation differences arising 98 747
on translations of foreign
operations items that may be reclassified
to profit or loss
Currency translation differences 1,088 866
arising on translations
of foreign operations relating to taxation
Total comprehensive loss attributable (743) (4,743)
to equity holders of the parent
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
year ended 31 December 2017
Company number 5048549 Notes 2017 2016
US$000 US$000
Non-current assets
Intangible assets 5 11,881 10,264
Property, plant and equipment 6 35,163 37,316
Trade and other receivables 1,476 1,100
Deferred tax asset 6,928 5,855
Restricted cash 14 139
55,462 54,674
Current assets
Inventories 1,713 1,366
Trade and other receivables 2,531 3,096
Cash and cash equivalents 704 2,236
4,948 6,698
Total assets 60,410 61,372
Current liabilities
Trade and other payables (7,822) (5,877)
Other financial liabilities (399) (461)
Current tax payable - (11)
Provisions (112) (190)
Borrowings (724) (4,439)
(9,057) (10,978)
Net current liabilities (4,109) (4,280)
Non-current liabilities
Other financial liabilities - (254)
Other payables (160) (190)
Provisions (4,512) (3,978)
Convertible bonds (12,496) (11,281)
Borrowings (937) (700)
(18,105) (16,403)
Total liabilities (27,162) (27,381)
Net assets 33,248 33,991
Equity
Called-up share capital 3,886 3,886
Share premium 141,918 141,918
Merger reserve (282) (282)
Other reserve 333 333
Currency translation reserve (44,618) (45,804)
Accumulated losses (67,989) (66,060)
Total equity 33,248 33,991
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
year ended 31 December 2017
Note Share Share Merger Currency Other Accumulated Total
capital premium reserve translation reserve losses US$000
US$000 US$000 US$000 reserve US$000 US$000
US$000
1 3,886 141,918 (282) (47,417) - (59,704) 38,401
January
2016
Loss for (6,356) (6,356)
the year
Other - - - 1,613 - 1,613
comprehensive
loss
Total - - - 1,613 - (6,356) (4,743)
comprehensive
profit
Equity - - - - 333 - 333
component
of
loans
received
31 3,886 141,918 (282) (45,804) 333 (66,060) 33,991
December
2016
Loss for (1,929) (1,929)
the year
Other - - - 1,186 - - 1,186
comprehensive
income
Total - - - 1,186 - (1,929) (743)
comprehensive
loss
31 3,886 141,918 (282) (44,618) 333 (67,989) 33,248
December
2017
CONSOLIDATED STATEMENT OF CASHFLOWS
year ended 31 December 2017
Notes 2017 2016
US$000 US$000
Net cash inflow/(outflow) from 5,107 (2,918)
operating activities
Investing activities
Purchase of property, plant and equipment 5 (2,252) (4,898)
Exploration costs 6 (439) (396)
Net cash used in investing activities (2,691) (5,294)
Financing activities
Loans received 724 13,661
Borrowings repaid (4,331) (3,434)
Interest repaid (341) (759)
Net cash (outflow)/inflow from (3,948) 9,468
financing activities
(Decrease)/increase in cash (1,532) 1,256
and cash equivalents
Foreign currency translation - (104)
Cash and cash equivalents 2,236 1,084
at beginning of the year
Cash and cash equivalents at end of the year 704 2,236
NOTES TO THE FINANCIAL STATEMENTS
year ended 31 December 2017
1General information
Altyn Plc (the "Company") is a Company incorporated in England
and Wales under the Companies Act 2006.
The financial information set out above for the years ended 31
December 2017 and 31 December 2016 does not constitute statutory
accounts as defined in Section 434 of the Companies Act 2006, but
is derived from those accounts. Whilst the financial information
included in this announcement has been compiled in accordance with
International Financial Reporting Standards ("IFRS") (as adopted by
the European Union), this announcement itself does not contain
sufficient financial information to comply with IFRS. A copy of the
statutory accounts for 2016 has been delivered to the Registrar of
Companies and those for 2017 will be submitted for approval by
shareholders at the Annual General Meeting. The full audited
financial statements for the years end 31 December 2017 and 31
December 2016 do comply with IFRS.
2Going concern
To progress the mine to the full projected capacity the Company
requires further funding, which the Company has made good progress
in putting in place. It is currently in the advanced stages of
finalising funding for new equipment from two parties. It is
seeking bond finance from one party and direct equipment purchasing
from another party, in order to secure he necessary investment.
The Company is continuing to develop its underground mine,
production is continuing at a steady pace with gold sold in the
current year of 16,747 oz. From the operating cash flows generated
the Company paid the balance of the EBRD loan, which with interest
amounted to US$3.5m. In order to preserve cash flow, savings have
been made in overhead costs at both head office and subsidiary
level. In January 2018, African Resources Limited converted US$9.7m
of the US$10m convertible loan debt into new ordinary shares. No
interest was paid in relation to this loan in the year and it is
expected that the balance of the bond to include accrued interest
will be converted inti new ordinary shares in Q3 2018.
The Directors have reviewed the cash flows for 15 months from
the date of approval of the financial statements based on the
projected trading. The Directors are confident that should the fund
raising not be successful to provide the funds in the expected
timeframe the Company will be able to adapt its operational plans
such that it continues to operate.
Furthermore the major shareholder has confirmed their intention
to provide further funding to enable the Company to continue its
planned operations for at least twelve months from the date of
approval of the financial statements.
On this basis the Directors have therefore concluded that it is
appropriate to prepare the financial statements on a going concern
basis.
3Revenue
An analysis of the Company's revenue is as follows: 2017 2016
US$000 US$000
Sale of gold and silver 21,649 15,867
Included in revenues from sale of gold and silver are revenues
of US$21,294,000 (2016: US$15,862,000) which arose from sales of
precious metals to one customer based Kazakhstan. Other sales
amounted to US$355,000 (2016 US$5,000), and related to sale of
surplus materials and consumables.
4Loss per ordinary share
The calculation of basic and diluted earnings per share from
continuing operations is based upon the retained loss from
continuing operations for the financial year of US$1.9m (2016: loss
of US$6.4m).
The weighted average number of ordinary shares for calculating
the basic loss in 2017 and 2016 is shown below. As the Company was
loss making in 2017, the impact of the potential ordinary shares
outstanding from the conversion of the Convertible loan notes would
be anti-dilutive, and as such the basic and diluted earnings per
share are the same. The total number of all non-dilutive potential
shares related to the issue of the convertible loans is disclosed
in Note 22 of the Annual Report.
2017 2016
Basic and diluted 2,334,342,130 2,334,342,130
5Intangible assets
Karasuyskoye Exploration and US$000
geological data evaluation costs
Cost
1 January 2016 11,139 - 11,139
Translation difference 206 - 206
Additions - 396 396
Amortisation capitalized - 322 322
31 December 2016 11,345 718 12,063
& 1 January 2017
Translation difference 79 - 79
Transfer 157 157
Additions - 1,430 1,430
Amortisation capitalized - 1,021 1,021
31 December 2017 11,424 3,326 14,750
Amortisation
1 January 2016 1,252 - 1,252
Charge for the year 553 - 553
Translation difference (6) - (6)
31 December 2016 1,799 - 1,799
& 1 January 2017
Charge for the year 1,021 - 1,021
Translation difference 49 - 49
31 December 2017 2,869 - 2,869
Net book value
1 January 2016 9,887 - 9,887
31 December 2016 9,546 718 10,264
31 December 2017 8,555 3,326 11,881
The intangible assets relate to the historic geological
information pertaining to the Karasuyskoye ore fields. The ore
fields are located in close proximity to the current open pit and
underground mining operations of Sekisovskoye. The Company obtained
a contract for exploration and evaluation on the site in May 2016
from the Kazakh authorities. The contract is valid for a period of
6 years, which is a right to extend for a minimum period of 4
years.
They took the view that initially a 20 year write off was
appropriate in relation to the absorption of the costs with
extension given the current development of the site, this has been
revised to write off the geological data over the period the
licence expires being with the minimum extension to May 2026 a
period of 10 years. The costs amortised are capitalised in line
with the Company's accounting policy. The effect is to increase the
amortisation charge from US$522,000 to US$1,021,000, there is no
effect on the income statement as the amortisation costs are
capitalised as part of exploration and evaluation costs. Based on
results of further work performed during the year, the Directors do
not consider there to be any indicators of impairment and consider
the project to remain prospective.
6Property, plant and equipment - Group
Mining Freehold, Equipment, Plant, Assets under Total
properties land and fixtures and machinery construction US$000
and leases buildings fittings and US$000
US$000 US$000 US$000 vehicles
US$000
Cost
1 8,390 9,080 11,101 4,374 19,419 52,364
January
2016
Additions - 217 1,056 1,376 2,891 5,540
Disposals - - (663) - (1) (664)
Transfers - 14,788 505 - (15,293) -
Transfers 2,817 - - - (3,194) (377)
to
inventories
Currency 144 156 190 75 333 898
translation
adjustment
31 11,351 24,241 12,189 5,825 4,155 57,761
December
2016
&
1
January
2017
Additions 1,196 38 399 283 686 2,602
Disposals - (15) (257) (53) (133) (458)
Transfer (157) - - - - (157)
to
exploration
&
evaluation
costs
Transfers (1,513) 2,465 (829) 2,469 (2,651) (59)
Currency (34) 22 44 4 49 85
translation
adjustment
31 10,843 26,751 11,546 8,528 2,106 59,774
December
2017
Accumulated
depreciation
1 2,121 3,989 8,058 3,061 - 17,229
January
2016
Charge 102 1,016 1,573 376 - 3,067
for
the
year
Disposals - - (216) - - (216)
Currency 39 95 169 62 - 365
translation
adjustment
31 2,262 5,100 9,584 3,499 - 20,445
December
2016
&
1
January
2017
Charge 222 2,498 1,452 336 - 4,508
for
the
year
Disposals - (15) (208) (40) (263)
Transfers (180) (290) (1,871) 2,282 (59)
Currency 2 (33) 6 5 - (20)
translation
adjustment
31 2,306 7,260 8,963 6,082 - 24,611
December
2017
Net
book
value
1 6.269 5,091 3,043 1,313 19,419 35,135
January
2016
31 9,089 19,141 2,605 2,326 4,155 37,316
December
2016
31 8,537 19,491 2,583 2,446 2,106 35,163
December
2017
Capitalised cost of mining property and leases are amortised
over the life of the licence from commencement of production on a
unit of production basis. This basis uses the ratio of production
in the period compared to the mineral reserves at the end of the
period. Mineral reserves estimates are based on a number of
underlying assumptions, which are inherently uncertain. Mineral
reserves estimates take into consideration estimates by independent
geological consultants. However, the amount of mineral that will
ultimately be recovered cannot be known until the end of the life
of the mine.
Any changes in reserve estimates are, for amortisation purposes,
treated on a prospective basis. The recovery of the capitalised
cost of the Company's property, plant and equipment is dependent on
the development of the underground mine.
The Directors are required to consider whether the non-current
assets comprising, mineral properties leases, plant and equipment
have suffered any impairment. In determining if there any
indicators of impairment, the Directors have considered the
operational performance in the period and do not consider that
there is an indicator of impairment. Should an indicator of
impairment have been identified, the recoverable amount would have
been determined based on value in use calculations. The use of this
method requires the estimation of future cash flows and the choice
of a discount rate in order to calculate the present value of the
cash flows. The directors have concluded that no adjustment is
required for impairment.
7Availability of accounts
The audited Annual Report and Financial Statements for the 12
months ended 31 December 2017 and notice of AGM will shortly be
sent to shareholders and published at: www.altyn.uk
View source version on businesswire.com:
https://www.businesswire.com/news/home/20180430005929/en/
This information is provided by Business Wire
(END) Dow Jones Newswires
April 30, 2018 11:25 ET (15:25 GMT)
Altyngold (LSE:ALTN)
Historical Stock Chart
From May 2024 to Jun 2024
Altyngold (LSE:ALTN)
Historical Stock Chart
From Jun 2023 to Jun 2024