TIDMMCM
RNS Number : 3365N
MC Mining Limited
29 January 2021
Appendix 5B
Mining exploration entity or oil and gas exploration entity
quarterly cash flow report
Name of entity
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MC Mining Limited
ABN Quarter ended ("current quarter")
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98 008 905 388 31 December 2020
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Consolidated statement of cash Current quarter Year to date
flows (six months)
$USD'000 $USD'000
1. Cash flows from operating
activities
1.1 Receipts from customers 4,095 8,068
1.2 Payments for
(a) exploration & evaluation
(b) development
(c) production (4,215) (8,189)
(d) staff costs (635) (1,065)
(e) administration and corporate
costs (1,082) (1,883)
1.3 Dividends received (see note
3)
1.4 Interest received - -
Interest and other costs of
1.5 finance paid (54) (66)
1.6 Income taxes paid
1.7 Government grants and tax
incentives
Other (provide details if
1.8 material) (9) 1
---------------- --------------
Net cash from / (used in)
1.9 operating activities (1,900) (3,134)
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2. Cash flows from investing
activities
2.1 Payments to acquire or for:
(a) entities
(b) tenements
(c) property, plant and equipment (94) (133)
(d) exploration & evaluation (25) (35)
(e) investments (170) (274)
(f) other non-current assets
2.2 Proceeds from the disposal
of:
(a) entities
(b) tenements
(c) property, plant and equipment - 510
(d) investments
(e) other non-current assets
2.3 Cash flows from loans to other
entities
2.4 Dividends received (see note
3)
Other (provide details if
2.5 material) (48) (110)
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Net cash from / (used in)
2.6 investing activities (337) (42)
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3. Cash flows from financing
activities
Proceeds from issues of equity
securities (excluding convertible
3.1 debt securities) - 885
3.2 Proceeds from issue of convertible
debt securities
3.3 Proceeds from exercise of
options
3.4 Transaction costs related
to issues of equity securities
or convertible debt securities
3.5 Proceeds from borrowings 2,910 4,373
3.6 Repayment of borrowings (82) (195)
3.7 Transaction costs related
to loans and borrowings
3.8 Dividends paid
Other (provide details if
3.9 material) (235) (453)
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Net cash from / (used in)
3.10 financing activities 2,593 4,610
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4. Net increase / (decrease)
in cash and cash equivalents
for the period
Cash and cash equivalents
4.1 at beginning of period 1,562 464
Net cash from / (used in)
operating activities (item
4.2 1.9 above) (1,900) (3,134)
Net cash from / (used in)
investing activities (item
4.3 2.6 above) (337) (42)
Net cash from / (used in)
financing activities (item
4.4 3.10 above) 2,593 4,610
Effect of movement in exchange
4.5 rates on cash held 46 66
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Cash and cash equivalents
4.6 at end of period 1,964 1,964
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5. Reconciliation of cash and Current quarter Previous quarter
cash equivalents $USD'000 $USD'000
at the end of the quarter
(as shown in the consolidated
statement of cash flows) to
the related items in the accounts
5.1 Bank balances 3,888 3,807
5.2 Call deposits 36 32
5.3 Bank overdrafts (1,960) (1,875)
5.4 Other (provide details)
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Cash and cash equivalents
at end of quarter (should
5.5 equal item 4.6 above) 1,964 1,964
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6. Payments to related parties of the entity Current quarter
and their associates $USD'000
6.1 Aggregate amount of payments to related
parties and their associates included in
item 1
----------------
6.2 Aggregate amount of payments to related
parties and their associates included in
item 2
----------------
Note: if any amounts are shown in items 6.1 or 6.2, your quarterly
activity report must include a description of, and an explanation
for, such payments.
7. Financing facilities Total facility Amount drawn
Note: the term "facility' amount at quarter at quarter end
includes all forms of financing end $USD'000
arrangements available to $USD'000
the entity. Add notes as necessary
for an understanding of the
sources of finance available
to the entity.
7.1 Loan facilities 10,914 10,914
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7.2 Credit standby arrangements
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7.3 Other (please specify) 2,876 2,677
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7.4 Total financing facilities 13,790 13,591
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Unused financing facilities available at
7.5 quarter end 204
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7.6 Include in the box below a description of each facility
above, including the lender, interest rate, maturity date
and whether it is secured or unsecured. If any additional
financing facilities have been entered into or are proposed
to be entered into after quarter end, include a note providing
details of those facilities as well.
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7.1 Loan Facilities $USD10.9 million:
The loan provided by the Industrial Development Corporation
of South Africa ("IDC") to the company's subsidiary was
fully draw at the end of the quarter. The drawn amount
plus interest was payable prior to 30 November 2020. The
Company has lodged a formal application to extend the
repayment period. In the unlikely event that the parties
cannot reach agreement on further deferment terms, the
financing documentation allows the debt to be converted
into equity. Interest accrues at a real after tax rate
of return of 16% on the advanced amount.
7.3 Other $USD2.9 million :
$USD 1.4 million relates to the ABSA Facility that was
secured during the 2019 financial year, from ABSA Bank.
The facility is for short-term working capital requirements
and potential expansion opportunities. The facility has
a floating coupon at the South African Prime rate (currently
7% per annum) plus 1.0%, with the operating mine Uitkomst
Colliery debtors ceded as security. The facility is subject
to annual review. The short-term working facility was
increased by an additional $USD 1.4 million in May 2020
to alleviate the financial challenges during the COVID-19
period. This additional facility is temporary and was
payable over twelve months commencing 1 July 2020 to 1
June 2021. During the period, the additional facility
was reduced to $USD0.8 million because of the commencement
of repayments. The Company successfully negotiated a delay
on the balance of the repayments until 1 July 2021. The
same interest rate applies. $USD0.2 million of this facility
was un-drawn at the end of the quarter.
The balance of $USD1.5 million relates to an equipment
lease facility with ABSA that has been fully utilised.
The lease facility has a five-year term at the South Africa
prime interest rate (currently 7% per annum).
-----------------
8. Estimated cash available for future operating $USD'000
activities
Net cash from / (used in) operating activities
8.1 (item 1.9) (1,900)
8.2 (Payments for exploration & evaluation classified (25)
as investing activities) (item 2.1(d))
8.3 Total relevant outgoings (item 8.1 + item (1,925)
8.2)
8.4 Cash and cash equivalents at quarter end 1,964
(item 4.6)
8.5 Unused finance facilities available at quarter 204
end (item 7.5)
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8.6 Total available funding (item 8.4 + item 2,168
8.5)
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Estimated quarters of funding available
8.7 (item 8.6 divided by item 8.3) 1.1
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Note: if the entity has reported positive relevant outgoings
(ie a net cash inflow) in item 8.3, answer item 8.7 as
"N/A". Otherwise, a figure for the estimated quarters
of funding available must be included in item 8.7.
8.8 If item 8.7 is less than 2 quarters, please provide answers
to the following questions:
8.8.1 Does the entity expect that it will continue to
have the current level of net operating cash flows for
the time being and, if not, why not?
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Answer:
The Group expects to generate operating cash flows for
the March and June quarters from the significant increase
in thermal coal pricing since December 2020. The Group
is the process of a fund raising to finance development
of its flagship Makhado project and provide working capital.
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8.8.2 Has the entity taken any steps, or does it propose
to take any steps, to raise further cash to fund its operations
and, if so, what are those steps and how likely does it
believe that they will be successful?
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Answer:
A fund raising is currently in progress to finance the
development of the Makhado project and provide working
capital as referred to in 8.8.1 above. The various components
of this fund raising currently being negotiated include,
but are not limited to:
* The issue of new equity for cash in the Company to
potential new shareholders;
* Debt funding;
* Contractor funding such as build, own, operate,
transfer arrangements.
The Group has a history of successful capital raisings
to meet funding requirements.
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8.8.3 Does the entity expect to be able to continue its
operations and to meet its business objectives and, if
so, on what basis?
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Answer:
The recent material increase in thermal coal prices is
forecast to generate operating cash flows for the group.
The current fund raising initiatives in progress are intended
to provide working capital and to achieve the Groups objective
of becoming South Africa's first large scale hard coking
coal miner.
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Note: where item 8.7 is less than 2 quarters, all of questions
8.8.1, 8.8.2 and 8.8.3 above must be answered.
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Compliance statement
1 This statement has been prepared in accordance with accounting
standards and policies which comply with Listing Rule 19.11A.
2 This statement gives a true and fair view of the matters disclosed.
Date:
...................................................................................
Disclosure Committee
Authorised by:
...................................................................................
(Name of body or officer authorising release - see note 4)
Notes
1. This quarterly cash flow report and the accompanying activity
report provide a basis for informing the market about the entity's
activities for the past quarter, how they have been financed and
the effect this has had on its cash position. An entity that wishes
to disclose additional information over and above the minimum
required under the Listing Rules is encouraged to do so.
2. If this quarterly cash flow report has been prepared in
accordance with Australian Accounting Standards, the definitions
in, and provisions of, AASB 6: Exploration for and Evaluation of
Mineral Resources and AASB 107: Statement of Cash Flows apply to
this report. If this quarterly cash flow report has been prepared
in accordance with other accounting standards agreed by ASX
pursuant to Listing Rule 19.11A, the corresponding equivalent
standards apply to this report.
3. Dividends received may be classified either as cash flows
from operating activities or cash flows from investing activities,
depending on the accounting policy of the entity.
4. If this report has been authorised for release to the market
by your board of directors, you can insert here: "By the board". If
it has been authorised for release to the market by a committee of
your board of directors, you can insert here: "By the [name of
board committee - eg Audit and Risk Committee]". If it has been
authorised for release to the market by a disclosure committee, you
can insert here: "By the Disclosure Committee".
5. If this report has been authorised for release to the market
by your board of directors and you wish to hold yourself out as
complying with recommendation 4.2 of the ASX Corporate Governance
Council's Corporate Governance Principles and Recommendations, the
board should have received a declaration from its CEO and CFO that,
in their opinion, the financial records of the entity have been
properly maintained, that this report complies with the appropriate
accounting standards and gives a true and fair view of the cash
flows of the entity, and that their opinion has been formed on the
basis of a sound system of risk management and internal control
which is operating effectively.
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