Serabi Gold (AIM:SRB) (TSX:SBI), the Brazilian focused gold mining
and development company has reported record gold production for the
third quarter of 2016 and Cash Costs of production for the year to
date of US$772 per ounce. Today, the Company releases its
unaudited interim financial results for the three and nine month
periods ending 30 September 2016 and, at the same time, has
published its Management’s Discussion and Analysis for the same
period.
Key Financial Information
SUMMARY FINANCIAL STATISTICS FOR THE THREE AND
NINE MONTHS ENDING 30 SEPTEMBER 2016 |
|
3 months to 30 Sept
2016US$ |
9 months to 30 Sept
2016US$ |
3 months to 30 Sept 2015(1)US$ |
9 months to 30 Sept 2015(1)US$ |
Revenue |
|
16,209,753 |
|
|
42,120,928 |
|
|
8,365,289 |
|
|
27,043,682 |
|
Cost of Sales |
|
(10,216,119 |
) |
|
(25,828,941 |
) |
|
(6,302,006 |
) |
|
(19,350,056 |
) |
Depreciation and amortisation charges |
|
(2,907,161 |
) |
|
(6,552,101 |
) |
|
(871,576 |
) |
|
(3,603,810 |
) |
Gross profit |
|
3,086,473 |
|
|
9,739,886 |
|
|
1,191,707 |
|
|
4,089,816 |
|
|
|
|
|
|
Profit before tax |
|
743,503 |
|
|
2,305,731 |
|
|
114,176 |
|
|
191,073 |
|
Profit after tax |
|
465,480 |
|
|
1,471,662 |
|
|
114,176 |
|
|
191,073 |
|
Earnings per ordinary share (basic) |
0.11c |
0.35c |
0.02c |
0.03c |
|
|
|
|
|
Average gold price received |
|
US$1,256 |
|
US$1,156 |
|
|
|
|
|
|
|
|
As at 30 Sept
2016 |
As at 31 Dec 2015 |
Cash and cash equivalents |
|
|
|
3,116,123 |
|
|
2,191,759 |
|
Net assets |
|
|
|
60,741,839 |
|
|
46,783,645 |
|
|
|
|
|
|
Cash Cost and All-In Sustaining Cost (“AISC”) |
|
|
|
|
|
|
|
9 months to 30 Sept
2016 |
9 months to 30 Sept 2015 |
Gold production for cash cost and AISC
purposes |
|
|
29,900(3) |
22,720(2)(3) |
|
|
|
|
|
Total Cash Cost of production (per ounce) |
|
|
US$772 |
US$702 |
Total AISC of production (per ounce) |
|
|
US$951 |
US$894 |
(1)The Sao Chico Mine was only declared to be in Commercial
Production with effect from 1 January 2016 and all costs and
revenues relating to this mine were capitalised prior to this
date. The Income Statements for 2015 therefore only reflect
the revenues and costs arising from the gold produced from the
Palito Mine and the Cash Cost and AISC for the 2015 comparative
period therefore also only reflect the activities from the Palito
Mine.(2) Excludes gold production of 1,984 ounces from the Sao
Chico Mine which was not in commercial production during 2015.(3)
Gold production figures are subject to amendment pending final
agreed assays of the gold content of the copper/gold concentrate
and gold doré that is delivered to the refineries.
Key Operational Information
SUMMARY PRODUCTION STATISTICS FOR THE
THREE QUARTERS ENDING 30 SEPTEMBER
2016 (PALITO AND SAO CHICO) |
|
|
|
Quarter 1 2016 |
Quarter 2 2016 |
Quarter 32016 |
9 months 2016 |
9
months 2015 |
Horizontal
development |
Metres |
|
2,925 |
2,941 |
2,649 |
8,515 |
6,911 |
|
|
|
|
|
|
|
|
Mined ore |
Tonnes |
|
37,546 |
33,606 |
43,133 |
114,285 |
101,888 |
|
Gold grade (g/t) |
|
11.02 |
9.56 |
9.61 |
10.06 |
10.07 |
|
|
|
|
|
|
|
|
Milled
ore |
Tonnes |
|
36,615 |
39,402 |
42,464 |
118,481 |
96,480 |
|
Gold grade (g/t) |
|
8.58 |
8.17 |
8.08 |
8.27 |
8.75 |
|
|
|
|
|
|
|
|
Gold production (1)
(2) |
Ounces |
|
9,771 |
9,896 |
10,233 |
29,900(1) |
24,704 |
(1) Gold production figures are subject to amendment pending
final agreed assays of the gold content of the copper/gold
concentrate and gold doré that is delivered to the refineries.(2)
Gold production totals for 2016 include treatment of 13,227 tonnes
of flotation tails.
Financial Highlights
- Cash Cost for the year to date of US$772 per ounce.
- All-In Sustaining Cost for the year to date of US$951 per
ounce.
- Gross profit from operations of US$9.74 million for the first
nine months of 2016 which represents an improvement of 138 per cent
compared to the same period in 2015.
- Post tax profit of US$1.47 million compared with US$0.19
million for the same nine month period in 2015.
- Earnings per share of 0.35 cents for the first nine months of
2016.
- Cash holdings of US$3.12 million at 30 September 2016.
- Average gold price of US$1,256 received on gold sales in the
first nine months of 2016.
- Negligible borrowings with secured debt facilities outstanding
at 30 September of only US$1.4 million (30 June 2016: US$4.7
million)
2016 Guidance
- Forecast gold production for 2016 expected to be approximately
39,000 ounces.
- The Company maintains its cost guidance for the full year of an
All-In Sustaining Cost of US$950 to US$985 per ounce reflecting the
continued strength of the Brazilian Real with has appreciated by 19
per cent since March 2016.
Operational Highlights
- Record quarterly gold production of 10,233 ounces for the third
quarter of 2016 (Q2 2016 - 9,896 ounces).
- Mine production totalled 43,133 tonnes, a 28 per cent increase
over the preceding quarter.
- 31,916 tonnes at a grade of 9.52 grammes per tonne
(“g/t”) of gold from Palito.
- 11,217 tonnes at 9.88 g/t of gold from Sao Chico.
- 42,464 tonnes of ore processed through the plant for the
combined mining operations at an average grade of 8.27 g/t
including the processing of low grade stockpiles.
- 2,649 metres of horizontal mine development completed in the
quarter with 1,607 metres completed at Palito and 1,042 metres at
Sao Chico.
- With the third ball mill operational from the end of the second
quarter, along with a second flotation line and enhancements in the
carbon in pulp (“CIP”),
- These plant enhancements have increased plant capacity from
380-400 tonnes per day (“tpd”) to over 500 tpd. This
additional capacity of approximately 100 tpd is being used to
consume the surface stockpile as much as practicably possible.
- Work has commenced on the installation of a new carbon
regeneration kiln which should be completed in the early part of
the fourth quarter. The kiln will regenerate ‘fouled’ carbon and
enhance gold recoveries.
- Sao Chico has now been deepened to the 86m level, some 150
vertical metres below surface. The ramp is continuing at a
slower rate to the 71m level.
- During the third quarter, underground exploration drilling
continued at both sites. At Sao Chico the first 17 holes of a
6,000 metre programme were completed. The programme is
testing the continuity of the central ore-zone below the current
deepest workings at 86m down to level -20m.
- At the end of the third quarter, the combined surface ore
stockpiles at Palito and Sao Chico totalled 11,000 tonnes at an
average grade of 3.3 g/t of gold.
Clive Line, CFO of Serabi, commented,
“The third quarter has produced another satisfying result, both
operationally and financially. Gold production of 10,233
ounces was another successive record quarter being a three per cent
improvement on the preceding quarter. Record levels of mined and
milled tonnages were also achieved in the quarter. Gross
profit from operations has improved quarter on quarter and the
pre-tax profit of US$743,000 is a significant improvement over the
preceding quarter. At the same time, we continue to
strengthen the balance sheet and pay down debt reflected in the
improvement in the current asset position of the Company.
“During the third quarter we have changed customer for our
copper/gold concentrate production. This change has brought
with it improved payment terms but under IFRS, it has also
accelerated the date on which the sale of a consignment copper/gold
concentrate occurs. As a result, the third quarter results
have benefitted from the recognition of a one-off additional sale,
together with the associated production costs, of 160 tonnes of
concentrate being recognised in the quarter. This also
reflected in the balance sheet as the production costs of this 160
tonne shipment are no longer carried as inventory (valued at the
cost of production) as they would have been in preceding periods,
but as a receivable for the sales value of the shipment.
“The balance sheet has also been strengthened by the retirement
in the quarter of approximately US$3.33 million of debt. We
continue to repay the US$8 million debt facility from Sprott
Resource Lending Partnership which as at the end of October 2016
has been reduced to approximately US$1.0 million. In addition, the
financial position has been improved through the conversion, by
Fratelli Investment Limited, of its US$2 million convertible loan
which occurred during August 2016.
“The cash position is slightly lower than at the end of June
2016, but this reflects the settlement for this 160 tonnes shipment
of concentrate that left Brazil at the end of September for which
payment only occurred in the first few days of the following
month. The change in customer has eliminated the need for the
US$7.5 million short term trade finance arrangements that the
Company has had in place for some three years which financed the
concentrate sales for approximately four months prior to any
initial settlement being received from the smelter. This
change is therefore expected to bring significant savings in
finance costs in the future.
“Whilst our costs, in local currency terms, continue to be
relatively steady, the Brazilian economy and therefore the
Brazilian Real have continued to benefit from high inward
investment flows, supplemented by tax inflows from previously
undeclared foreign income and investment holdings that have been
stimulated by a short-term amnesty. These inward flows have
continued to support the currency, though with the amnesty coming
to an end, there has been some recent weakening. We continue
to evaluate all opportunities to improve our cost base and improve
gold recovery to maintain and improve margins.”
SERABI GOLD PLC |
Condensed Consolidated Statements of Comprehensive
Income |
|
|
|
|
|
|
|
|
For the three months ended 30 September |
For the nine months ended30 September |
|
|
|
|
|
2016 |
|
|
2015 |
|
|
2016 |
|
|
2015 |
|
(expressed in US$) |
Notes |
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
CONTINUING
OPERATIONS |
|
|
|
|
|
Revenue |
|
|
16,209,753 |
|
|
8,365,289 |
|
|
42,120,928 |
|
|
27,043,682 |
|
Operating expenses |
|
|
(10,216,119 |
) |
|
(6,302,006 |
) |
|
(25,828,941 |
) |
|
(19,350,056 |
) |
Depreciation of plant and equipment |
|
|
(2,907,161 |
) |
|
(871,576 |
) |
|
(6,552,101 |
) |
|
(3,603,810 |
) |
Gross
profit |
|
|
3,086,473 |
|
|
1,191,707 |
|
|
9,739,886 |
|
|
4,089,816 |
|
Administration
expenses |
|
|
(1,267,898 |
) |
|
(871,153 |
) |
|
(3,812,218 |
) |
|
(3,024,671 |
) |
Share based payments |
|
|
(101,072 |
) |
|
(101,019 |
) |
|
(249,828 |
) |
|
(303,056 |
) |
Gain on disposal of
assets |
|
|
2,070 |
|
— |
|
29,039 |
|
— |
Operating profit |
|
|
1,719,573 |
|
|
219,535 |
|
|
5,706,879 |
|
|
762,089 |
|
Foreign exchange loss |
|
|
(28,860 |
) |
|
(364,869 |
) |
|
(101,268 |
) |
|
(171,238 |
) |
Finance expense |
3 |
|
(947,250 |
) |
|
(388,074 |
) |
|
(3,299,989 |
) |
|
(1,206,276 |
) |
Investment income |
3 |
|
40 |
|
|
647,584 |
|
|
109 |
|
|
806,498 |
|
Profit before
taxation |
|
|
743,503 |
|
|
114,176 |
|
|
2,305,731 |
|
|
191,073 |
|
Income tax expense |
|
|
(278,023 |
) |
— |
|
(834,069 |
) |
— |
Profit for the period from continuing operations (1)
(2) |
|
|
465,480 |
|
|
114,176 |
|
|
1,471,662 |
|
|
191,073 |
|
|
|
|
|
|
|
Other
comprehensive incomeItems that may be reclassified
subsequently to profit or loss |
Exchange differences on translating foreign operations |
|
|
(588,314 |
) |
|
(11,995,969 |
) |
|
9,041,254 |
|
|
(21,183,302 |
) |
Total comprehensive loss for the period (2) |
|
|
(122,834 |
) |
|
(11,881,793 |
) |
|
10,512,916 |
|
|
(20,992,229 |
) |
|
|
|
|
|
|
Profit / (loss) per ordinary share (basic) (1) |
4 |
0.11c |
0.02c |
0.35c |
0.03c |
Profit / (loss) per ordinary share (diluted) (1) |
4 |
0.10c |
0.01c |
0.32c |
0.02c |
(1) All revenue and expenses arise from continuing
operations.(2) The Group has no non-controlling interests and all
losses are attributable to the equity holders of the parent
company.
SERABI GOLD
PLC |
Condensed
Consolidated Balance Sheets |
|
|
|
|
|
|
|
|
|
|
|
|
|
As
at |
As
at |
As at |
|
|
30 September |
30 September |
31 December |
|
|
|
2016 |
|
|
2015 |
|
|
2015 |
|
(expressed in US$) |
|
(unaudited) |
(unaudited) |
(audited) |
Non-current
assets |
|
|
|
|
Deferred exploration
costs |
|
|
9,731,144 |
|
|
9,018,777 |
|
|
8,679,246 |
|
Property, plant and equipment |
|
|
44,860,837 |
|
|
39,181,535 |
|
|
40,150,484 |
|
Total non-current assets |
|
|
54,591,981 |
|
|
48,200,312 |
|
|
48,829,730 |
|
Current
assets |
|
|
|
|
Inventories |
|
|
7,865,290 |
|
|
7,677,056 |
|
|
6,908,790 |
|
Trade and other
receivables |
|
|
9,165,344 |
|
|
6,683,465 |
|
|
6,133,284 |
|
Prepayments and accrued
income |
|
|
2,652,081 |
|
|
2,248,960 |
|
|
2,429,506 |
|
Cash and cash equivalents |
|
|
3,116,123 |
|
|
3,814,439 |
|
|
2,191,759 |
|
Total current assets |
|
|
22,798,838 |
|
|
20,423,920 |
|
|
17,663,339 |
|
Current
liabilities |
|
|
|
|
Trade and other
payables |
|
|
6,564,033 |
|
|
4,788,850 |
|
|
4,212,803 |
|
Interest bearing
liabilities |
|
|
1,425,058 |
|
|
4,928,000 |
|
|
4,000,000 |
|
Trade and asset finance
facilities |
|
|
3,260,272 |
|
|
7,892,830 |
|
|
7,385,155 |
|
Derivative financial
liabilities |
|
|
262,000 |
|
|
70,038 |
|
— |
Accruals |
|
|
367,646 |
|
|
167,237 |
|
|
226,197 |
|
Total current liabilities |
|
|
11,879,009 |
|
|
17,846,954 |
|
|
15,824,155 |
|
Net current assets |
|
|
10,919,829 |
|
|
2,576,966 |
|
|
1,839,184 |
|
Total assets less current liabilities |
|
|
65,511,810 |
|
|
50,777,278 |
|
|
50,668,914 |
|
Non-current
liabilities |
|
|
|
|
Trade and other
payables |
|
|
2,275,312 |
|
|
2,226,238 |
|
|
1,857,914 |
|
Provisions |
|
|
2,284,002 |
|
|
2,075,105 |
|
|
1,898,714 |
|
Interest bearing liabilities |
|
|
210,657 |
|
|
246,557 |
|
|
128,641 |
|
Total non-current liabilities |
|
|
4,769,971 |
|
|
4,547,900 |
|
|
3,885,269 |
|
Net assets |
|
|
60,741,839 |
|
|
46,229,378 |
|
|
46,783,645 |
|
Equity |
|
|
|
|
Share capital |
|
|
5,540,960 |
|
|
5,263,182 |
|
|
5,263,182 |
|
Share premium |
|
|
1,722,222 |
|
— |
— |
Option reserve |
|
|
1,237,581 |
|
|
2,646,397 |
|
|
2,747,415 |
|
Other reserves |
|
|
361,461 |
|
|
450,262 |
|
|
450,262 |
|
Translation reserve |
|
|
(30,185,281 |
) |
|
(39,919,594 |
) |
|
(39,226,535 |
) |
Distributable surplus |
|
|
82,064,896 |
|
|
77,789,131 |
|
|
77,549,321 |
|
Equity shareholders’ funds |
|
|
60,741,839 |
|
|
46,229,378 |
|
|
46,783,645 |
|
The interim financial information has not been
audited and does not constitute statutory accounts as defined in
Section 434 of the Companies Act 2006. Whilst the financial
information included in this announcement has been compiled in
accordance with International Financial Reporting Standards
(“IFRS”) this announcement itself does not contain sufficient
financial information to comply with IFRS. The Group
statutory accounts for the year ended 31 December 2015 prepared
under IFRS as adopted in the EU and with IFRS and their
interpretations adopted by the International Accounting Standards
Board have been filed with the Registrar of Companies following
their adoption by shareholders at the Annual General Meeting. The
auditor’s report on these accounts was unqualified but did contain
an Emphasis of Matter with respect to the Company and the Group
regarding Going Concern. The auditor’s report did not contain
a statement under Section 498 (2) or 498 (3) of the Companies Act
2006.
SERABI GOLD
PLC |
Condensed
Consolidated Statements of Changes in Shareholders’
Equity |
|
|
|
|
|
|
|
|
(expressed in US$) |
Share |
Share |
Share option |
Other |
Translation |
Accumulated |
|
|
capital |
premium |
reserve |
reserves (1) |
reserve |
loss |
Total equity |
Equity shareholders’ funds at 31 December 2014
(audited) |
|
61,668,212 |
|
|
67,656,848 |
|
|
2,400,080 |
|
|
450,262 |
|
|
(18,736,292 |
) |
|
(46,520,559 |
) |
|
66,918,551 |
|
Foreign currency adjustments |
— |
— |
— |
— |
|
(9,187,333 |
) |
— |
|
(9,187,333 |
) |
Profit for the
period |
— |
— |
— |
— |
— |
|
76,897 |
|
|
76,897 |
|
Total comprehensive income for the period |
— |
— |
— |
— |
|
(9,187,333 |
) |
|
76,897 |
|
|
(9,110,436 |
) |
Share options lapsed in period |
— |
— |
|
(56,739 |
) |
— |
— |
|
56,739 |
|
— |
Share option expense |
— |
— |
|
202,037 |
|
— |
— |
— |
|
202,037 |
|
Equity
shareholders’ funds at 30 June
2015 (unaudited) |
|
61,668,212 |
|
|
67,656,848 |
|
|
2,545,378 |
|
|
450,262 |
|
|
(27,923,625 |
) |
|
(46,386,923 |
) |
|
58,010,152 |
|
Foreign currency
adjustments |
— |
— |
— |
— |
|
(11,302,910 |
) |
— |
|
(11,302,910 |
) |
Loss for the period |
— |
— |
— |
— |
— |
|
(125,634 |
) |
|
(125,634 |
) |
Total comprehensive income for the period |
— |
— |
— |
— |
|
(11,302,910 |
) |
|
(125,634 |
) |
|
(11,428,544 |
) |
Cancellation of share premium |
— |
|
(67,656,848 |
) |
— |
— |
— |
|
67,656,848 |
|
— |
Cancellation of deferred shares |
|
(56,405,030 |
) |
— |
— |
— |
— |
|
56,405,030 |
|
— |
Share option expense |
— |
— |
|
202,037 |
|
— |
— |
— |
|
202,037 |
|
Equity shareholders’ funds at 31 December 2015
(audited) |
|
5,263,182 |
|
— |
|
2,747,415 |
|
|
450,262 |
|
|
(39,226,535 |
) |
|
77,549,321 |
|
|
46,783,645 |
|
Foreign currency adjustments |
— |
— |
— |
— |
|
9,041,254 |
|
— |
|
9,041,254 |
|
Profit for the
period |
— |
— |
— |
— |
— |
|
1,471,662 |
|
|
1,471,662 |
|
Total comprehensive income for the period |
— |
— |
— |
— |
|
9,041,254 |
|
|
1,471,662 |
|
|
10,512,916 |
|
Shares issued in period |
|
277,778 |
|
|
1,722,222 |
|
— |
— |
— |
— |
|
2,000,000 |
|
Release of Fair Value provision on convertible
loan |
— |
— |
— |
— |
— |
|
1,195,450 |
|
|
1,195,450 |
|
Warrants lapsed |
— |
— |
— |
|
(88,801 |
) |
— |
|
88,801 |
|
— |
Share options lapsed in period |
— |
— |
|
(1,759,662 |
) |
— |
— |
|
1,759,662 |
|
— |
Share option expense |
— |
— |
|
249,828 |
|
— |
— |
— |
|
249,828 |
|
Equity shareholders’ funds at 30 September 2016
(unaudited) |
|
5,540,960 |
|
|
1,722,222 |
|
|
1,237,581 |
|
|
361,461 |
|
|
(30,185,281 |
) |
|
82,064,896 |
|
|
60,741,839 |
|
1) Other reserves comprise a merger reserve of
US$361,461 (2015: merger reserve of US$ 361,461 and warrant reserve
of US$88,801)
SERABI GOLD PLC |
Condensed Consolidated Cash Flow
Statements |
|
For the three
monthsended30
September |
For the nine
months ended30
September |
|
|
2016 |
|
|
2015 |
|
|
2016 |
|
|
2015 |
|
(expressed in US$) |
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
Operating activities |
|
|
|
|
Profit before
taxation |
|
465,480 |
|
|
114,176 |
|
|
1,471,662 |
|
|
191,073 |
|
Depreciation –
plant, and equipment |
|
2,907,161 |
|
|
871,576 |
|
|
6,552,101 |
|
|
3,603,810 |
|
Net financial
expense |
|
976,071 |
|
|
105,359 |
|
|
3,401,148 |
|
|
571,016 |
|
Taxation |
|
278,023 |
|
— |
|
834,069 |
|
— |
Share-based
payments |
|
101,072 |
|
|
101,019 |
|
|
249,828 |
|
|
303,056 |
|
Foreign
exchange gain |
|
38,109 |
|
|
112,300 |
|
|
207,785 |
|
|
276,788 |
|
Changes in working capital |
|
|
|
|
|
Decrease / (increase) in
inventories |
|
1,286,509 |
|
|
(1,103,999 |
) |
|
505,768 |
|
|
(2,552,479 |
) |
|
Decrease / (increase) in
receivables, prepayments and accrued income |
|
330,084 |
|
|
791,116 |
|
|
(2,434,886 |
) |
|
(775,400 |
) |
|
(Decrease) / increase in payables, accruals and provisions |
|
(68,421 |
) |
|
1,219,436 |
|
|
1,411,427 |
|
|
2,860,354 |
|
Net cash inflow from operations |
|
6,314,088 |
|
|
2,210,983 |
|
|
12,198,902 |
|
|
4,478,218 |
|
|
|
|
|
|
Investing activities |
|
|
|
|
Sales revenues
recognised to date |
— |
|
1,340,259 |
|
— |
|
2,267,350 |
|
Capitalised
pre-operating costs |
— |
|
(1,724,903 |
) |
— |
|
(2,392,111 |
) |
Purchase of property, plant and
equipment and projects in construction |
|
(713,069 |
) |
|
(997,540 |
) |
|
(2,840,740 |
) |
|
(4,285,435 |
) |
Mine
development expenditures |
|
(469,608 |
) |
|
(150,801 |
) |
|
(1,718,759 |
) |
|
(948,633 |
) |
Exploration
and development expenditure |
|
(247,479 |
) |
|
(108,083 |
) |
|
(247,479 |
) |
|
(570,318 |
) |
Proceeds from
sale of assets |
|
2,070 |
|
— |
|
29,039 |
|
— |
Interest received |
|
40 |
|
|
1 |
|
|
109 |
|
|
842 |
|
Net cash outflow on investing
activities |
|
(1,428,046 |
) |
|
(1,641,067 |
) |
|
(4,777,830 |
) |
|
(5,928,305 |
) |
|
|
|
|
|
Financing activities |
|
|
|
|
Repayment of
short-term secured loan |
|
(1,333,334 |
) |
|
(1,000,000 |
) |
|
(2,666,667 |
) |
|
(3,000,000 |
) |
Drawdown of
convertible loan and subsequent conversion of shares |
— |
— |
|
2,000,000 |
|
— |
Receipts from
short-term trade finance |
|
4,454,632 |
|
|
6,435,952 |
|
|
16,355,730 |
|
|
17,123,401 |
|
Repayment of
short-term trade finance |
|
(9,411,663 |
) |
|
(6,130,683 |
) |
|
(20,921,538 |
) |
|
(16,994,618 |
) |
Payment of
finance lease liabilities |
|
(161,210 |
) |
|
(303,380 |
) |
|
(542,731 |
) |
|
(570,445 |
) |
Interest paid
and other finance charges |
|
(125,901 |
) |
|
(84,406 |
) |
|
(624,233 |
) |
|
(854,276 |
) |
Net cash (outflow) from financing
activities |
|
(6,577,476 |
) |
|
(1,082,517 |
) |
|
(6,399,439 |
) |
|
(4,295,938 |
) |
|
|
|
|
|
Net
(decrease) / increase in cash and cash equivalents |
|
(1,691,434 |
) |
|
(512,601 |
) |
|
1,021,633 |
|
|
(5,746,025 |
) |
Cash
and cash equivalents at beginning of period |
|
4,774,537 |
|
|
4,481,970 |
|
|
2,191,759 |
|
|
9,813,602 |
|
Exchange difference on cash |
|
33,020 |
|
|
(154,930 |
) |
|
(97,269 |
) |
|
(253,138 |
) |
Cash and cash equivalents at end of
period |
|
3,116,123 |
|
|
3,814,439 |
|
|
3,116,123 |
|
|
3,814,439 |
|
Notes
1.
General InformationThe financial information set out above
does not constitute statutory accounts as defined in Section 434 of
the Companies Act 2006. Whilst the financial information included
in this announcement has been compiled in accordance with
International Financial Reporting Standards (“IFRS”) this
announcement itself does not contain sufficient financial
information to comply with IFRS. A copy of the statutory accounts
for 2015 was filed with the Registrar of Companies following their
adoption by shareholders at the next Annual General Meeting.
The full audited financial statements for the years end 31
December 2015 do comply with IFRS.
2.
Basis of PreparationThese interim accounts are for the
three and nine month periods ended 30 September 2016. Comparative
information has been provided for the unaudited three and nine
month periods ended 30 September 2015 and, where applicable, the
audited twelve month period from 1 January 2015 to 31 December
2015.
The accounts for the periods have been prepared
in accordance with International Accounting Standard 34 “Interim
Financial Reporting” and the accounting policies are consistent
with those of the annual financial statements for the year ended 31
December 2015 and those envisaged for the financial statements for
the year ending 31 December 2016.
The Group has not adopted any standards or
interpretation in advance of the required implementation
dates. It is not anticipated that the adoption in the future
of the new or revised standards or interpretations that have been
issued by the International Accounting Standards Board will have a
material impact on the Group’s earnings or shareholders’ funds.
These financial statements do not constitute
statutory accounts as defined in Section 434 of the Companies Act
2006.
Going concern and availability of
project financeHaving commenced initial development
activities for the Sao Chico Mine at the end of 2014, this mine was
in development throughout 2015. On 1 February 2016, the Group
announced that, with effect from 1 January 2016, the Sao Chico Mine
had achieved Commercial Production. The Palito Mine has been
in Commercial Production since 1 July 2014.
The Directors anticipate the Group now has
access to sufficient funding for its immediate projected
needs. The Group expects to have sufficient cash flow from
its forecast production to finance its on-going operational
requirements to repay its secured loan facilities and to, at least
in part, fund exploration and development activity on its other
gold properties. The secured loan facility is repayable
by 31 December 2016 and at 30 September 2016, the amount
outstanding under this facility was US$1.33 million.
However, the forecasted cash flow projections
for the remainder of 2016 include a continuing significant increase
in production from the Sao Chico Mine compared with the preceding
calendar year. Whilst the Group has declared Commercial
Production at the Sao Chico Mine, there are risks associated with
the commencement of any new mining operation whereby unforeseen
technical and logistical events result in additional costs needing
to be incurred, giving rise to the possibility that additional
working capital may be required. Additionally, the Group is exposed
to changes in gold price and currency exchange rates. Should
additional working capital be required the Directors consider that
further sources of finance could be secured within the required
timescale.
On this basis, the Directors have therefore
concluded that it is appropriate to prepare the financial
statements on a going concern basis. However, there is no certainty
that such additional funds either for working capital or for future
development will be forthcoming and these conditions indicate the
existence of a material uncertainty which may cast significant
doubt over the Group’s ability to continue as a going concern and,
therefore, that it may be unable to realise its assets and
discharge its liabilities in the normal course of business.
The financial statements do not include the adjustments that would
result if the Group was unable to continue as a going concern.
3. Finance income and
expense
Finance expense |
3 months ended 30 September
2016US$(unaudited) |
3 months ended 30 September 2015US$(unaudited) |
9 months ended 30 September
2016US$(unaudited) |
9 months ended 30 September 2015US$(unaudited) |
Interest and fees on
loans and finance facilities |
146,229 |
388,074 |
684,561 |
1,206,276 |
Effective interest
charge of the fair value, and loss on revaluation, of
derivatives |
378,719 |
— |
1,699,175 |
— |
Finance
cost on gold trading |
422,302 |
— |
916,253 |
— |
|
947,250 |
388,074 |
3,299,989 |
1,206,276 |
Finance income |
3 months ended 30 September
2016US$(unaudited) |
3 months ended 30 September 2015US$(unaudited) |
9 months ended 30 September
2016US$(unaudited) |
9 months ended 30 September 2015US$(unaudited) |
Gain on revaluation of
derivatives |
— |
474,336 |
— |
458,465 |
Finance income on gold
trading |
— |
173,246 |
— |
347,191 |
Interest
income |
40 |
2 |
109 |
842 |
|
40 |
647,584 |
109 |
806,498 |
4. Earnings per share
|
3 months ended 30 September 2016 |
3 months ended 30 September 2015 |
9 months ended 30 September 2016 |
9 months ended 30 September 2015 |
12 months ended 31 December 2015 |
Profit / (loss) attributable to ordinary shareholders (US$) |
743,503 |
114,176 |
2,305,731 |
191,073 |
|
(48,738 |
) |
Weighted average ordinary
shares in issue |
678,005,407 |
656,389,204 |
663,647,199 |
656,389,204 |
|
656,389,204 |
|
Basic profit/(loss) per share (US cents) |
0.11 |
0.02 |
0.35 |
0.03 |
|
(0.01 |
) |
Diluted ordinary shares in issue |
727,915,407(1) |
792,265,830(1) |
713,557,199(1) |
792,265,830(1) |
|
656,389,204 |
|
Diluted profit /(loss)
per share (US cents) |
0.10 |
0.01 |
0.32 |
0.02 |
(0.01)(2) |
(1) Assumes exercise of all options and warrants outstanding as
of that date.
(2) As the effect of dilution is to reduce the loss per share,
the diluted loss per share is considered to be the same as the
basic loss per share.
5.
Post balance sheet events
Between the end of the financial period and the
date that the financial statements were approved by the Board of
Directors there has been no item, transaction or event of a
material or unusual nature likely, in the opinion of the Directors
of the Company, to affect significantly the continuing operations
of the company, the results of these operations, or the state of
affairs of the Company in future financial periods.
This announcement is inside information for the
purposes of Article 7 of Regulation 596/2014.
Enquiries:
Serabi
Gold plc |
|
Michael
Hodgson |
Tel: +44
(0)20 7246 6830 |
Chief
Executive |
Mobile:
+44 (0)7799 473621 |
|
|
Clive
Line |
Tel: +44
(0)20 7246 6830 |
Finance
Director |
Mobile:
+44 (0)7710 151692 |
|
|
Email:
contact@serabigold.com |
|
Website: www.serabigold.com |
|
|
|
Beaumont
Cornish LimitedNominated Adviser and Financial Adviser |
|
Roland
Cornish |
Tel: +44
(0)20 7628 3396 |
Michael
Cornish |
Tel: +44
(0)20 7628 3396 |
|
|
Peel
Hunt LLPUK Broker |
|
Matthew
Armitt |
Tel: +44
(0)20 7418 8900 |
Ross
Allister |
Tel: +44
(0)20 7418 8900 |
|
|
Blytheweigh Public Relations |
|
Tim
Blythe |
Tel: +44
(0)20 7138 3204 |
Camilla
Horsfall |
Tel: +44
(0)20 7138 3224 |
Copies of this announcement are available from
the Company's website at www.serabigold.com.
Neither the Toronto Stock Exchange, nor any
other securities regulatory authority, has approved or disapproved
of the contents of this announcement.
The Company will, in compliance with Canadian
regulatory requirements, post the Unaudited Interim Financial
Statements and the Management Discussion and Analysis for the three
month and the nine month periods ended 30 September 2016 on SEDAR
at www.sedar.com. These documents will also available from
the Company’s website – www.serabigold.com.
GLOSSARY OF TERMSThe following
is a glossary of technical terms: “Au” means gold. “assay” in
economic geology, means to analyse the proportions of metal in a
rock or overburden sample; to test an ore or mineral for
composition, purity, weight or other properties of commercial
interest.“development” - excavations used to establish access
to the mineralised rock and other workings“doré – a semi-pure alloy
of gold silver and other metals produced by the smelting process at
a mine that will be subject to further refining.“DNPM” is the
Departamento Nacional de Produção Mineral.“grade” is the
concentration of mineral within the host rock typically quoted as
grams per tonne (g/t), parts per million (ppm) or parts per billion
(ppb).“g/t” means grammes per tonne.“granodiorite” is an igneous
intrusive rock similar to granite.“igneous” is a rock that has
solidified from molten material or magma.“Intrusive” is a body of
igneous rock that invades older rocks.“on-lode development” -
Development that is undertaken in and following the direction of
the Vein “mRL” – depth in metres measured relative to a fixed
point – in the case of Palito and Sao Chico this is
sea-level. The mine entrance at Palito is at
250mRL.“saprolite” is a weathered or decomposed clay‐rich
rock.“stoping blocks” – a discrete area of mineralised rock
established for planning and scheduling purposes that will be mined
using one of the various stoping methods. “Vein” is a generic
term to describe an occurrence of mineralised rock within an area
of non-mineralised rock.
Qualified Persons StatementThe
scientific and technical information contained within this
announcement has been reviewed and approved by Michael Hodgson, a
Director of the Company. Mr Hodgson is an Economic Geologist by
training with over 26 years' experience in the mining industry. He
holds a BSc (Hons) Geology, University of London, a MSc Mining
Geology, University of Leicester and is a Fellow of the Institute
of Materials, Minerals and Mining and a Chartered Engineer of the
Engineering Council of UK, recognising him as both a Qualified
Person for the purposes of Canadian National Instrument 43-101 and
by the AIM Guidance Note on Mining and Oil & Gas Companies
dated June 2009.
Forward Looking
StatementsCertain statements in this announcement are, or
may be deemed to be, forward looking statements. Forward looking
statements are identified by their use of terms and phrases such as
‘‘believe’’, ‘‘could’’, “should” ‘‘envisage’’, ‘‘estimate’’,
‘‘intend’’, ‘‘may’’, ‘‘plan’’, ‘‘will’’ or the negative of those,
variations or comparable expressions, including references to
assumptions. These forward looking statements are not based on
historical facts but rather on the Directors’ current expectations
and assumptions regarding the Company’s future growth, results of
operations, performance, future capital and other expenditures
(including the amount, nature and sources of funding thereof),
competitive advantages, business prospects and opportunities. Such
forward looking statements reflect the Directors’ current beliefs
and assumptions and are based on information currently available to
the Directors. A number of factors could cause actual results to
differ materially from the results discussed in the forward looking
statements including risks associated with vulnerability to general
economic and business conditions, competition, environmental and
other regulatory changes, actions by governmental authorities, the
availability of capital markets, reliance on key personnel,
uninsured and underinsured losses and other factors, many of which
are beyond the control of the Company. Although any forward looking
statements contained in this announcement are based upon what the
Directors believe to be reasonable assumptions, the Company cannot
assure investors that actual results will be consistent with such
forward looking statements.
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