Unaudited interim results for the three-and nine-month periods
ended 30 September 2024
Unaudited interim results for the three-and nine-month
periods ended 30 September 2024
Serabi (AIM:SRB, TSX:SBI, OTCQX:SRBIF),
the Brazilian focused gold mining and development company, is
pleased to release its unaudited interim results for the three and
nine-month periods ended 30 September 2024.
A copy of the full interim statements together
with commentary can be accessed on the Company’s website using the
following link:-
https://bit.ly/3Z8CJiX
“This has been another excellent quarter for
Serabi, in particular for cash generation, said Clive Line,
Serabi’s CFO. “The cash balance at the end of September was $20.0
million with $8.0 million generated during the quarter. EBITDA of
$11.7 million for the quarter brings EBITDA for the year to date to
a total of $24.7 million, a 42 per cent improvement compared with
the second quarter.
"We benefited from inventory realisation to
the sum of approximately $3.0M, boosting quarter sales, and whilst
I do not expect similar additional inventory sales for Q4, I do
anticipate cash growth to continue to the end of the year
notwithstanding the cyclical effects of tax payments and
13th salary accruals that are due. The
ability of the business to produce healthy cash flow is being
further supported by the Coringa classification plant which is now
operational and in the final stages of commissioning. We are
already passing run of mine ore through this plant and will also
start to work our way through the lower grade stockpiles that have
been accumulated at Coringa. As a result of processing this
stockpiled material we hope that this final quarter will continue
the pattern of increasing production quarter on quarter that we
have so far experienced in 2024.
"During the quarter we announced the results
of the Preliminary Economic Assessment for Coringa which indicate
an average project AISC of $1,241 over the project life from 1
January 2025 onwards. The full NI 43-101 compliant Technical Report
was published on 21 November 2024."
Financial Highlights (all
currency amounts are expressed in US Dollars unless otherwise
stated)
- Gold production for the first nine
months of 2024 of 27,499 ounces (2023: 25,262 ounces).
- Cash held on 30 September 2024 of
$20.0 million (31 December 2023: $11.6 million including US$0.6
million relating to the exploration alliance with Vale).
- EBITDA for the nine-month period of
$24.7 million (2023: $8.8 million).
- Post-tax profit for the nine-month
period of $17.8 million (2023: $4.6 million),
- Profit per share of 23.55 cents
compared with a profit per share of 6.10 cents for the same nine
month period of 2023.
- Net cash inflow from operations for
the nine-month period (after mine development expenditure of US$4.9
million) of US$18.2 million (2023: US$10.7 million inflow, after
mine development expenditure of US$2.6 million).
- Average gold price of US$2,338 per
ounce received on gold sales during the nine month period (2023:
US$1,940).
- Cash Cost for the nine month period
to 30 September 2024 of US$1,405 per ounce (nine months 2023:
US$1,253 per ounce).
- All-In Sustaining Cost for the
nine-month period to 30 September 2024 of US$1,790 per ounce (nine
months 2023: US$1,553 per ounce).
Overview of the financial
results
In the first nine months of 2024, the Group has
reported revenue and operating costs related to the sale of 28,912
ounces in the period (27,499 ounces produced). This compares to
sales reported of only 23,733 ounces in the first nine months of
2023. Reported revenues and costs reflect the ounces sold in each
period and as a result total costs for the nine-month period are
significantly higher than for the corresponding period of 2023.
During the month of January 2024, the Group also
completed and drew down a new US$5 million loan with Itaú Bank in
Brazil. This new arrangement has an interest coupon of 8.47 per
cent and is repayable as a bullet payment on 6 January 2025. This
replaced a similar loan arranged with Santander Bank in Brazil that
was repaid during the month of February 2024.
Final commissioning of the ore sorter and
crushing plant for Coringa is almost complete, with the crushing
plant operational during October and the ore-sorter starting up
during November. During the remainder of the fourth quarter in
addition to passing run of mine ore extracted from Coringa, the
Company will also be processing some of the lower grade material
that has been stockpiled at Coringa providing an additional boost
to gold production in the remainder of the fourth quarter.
Key Financial Information
|
SUMMARY FINANCIAL STATISTICS FOR THE THREE-AND NINE MONTHS
ENDING 30 SEPTEMBER 2024 |
|
|
9 months to
30 September 2024
US$
(unaudited) |
9 months to
30 September 2023
US$
(unaudited) |
3 months to
30 September 2024
US$
(unaudited) |
3 months to
30 September 2023
US$
(unaudited) |
|
|
|
Revenue |
70,290,641 |
47,897,264 |
27,626,034 |
17,373,682 |
|
|
|
Cost of sales |
(39,840,803) |
(34,405,882) |
(14,160,734) |
(13,341,448) |
|
|
|
Gross operating profit |
30,449,838 |
13,491,382 |
13,465,300 |
4,032,234 |
|
|
|
Administration and share based payments |
(5,728,359) |
(4,702,467) |
(1,719,359) |
(1,864,200) |
|
|
|
EBITDA |
24,721,479 |
8,788,915 |
11,745,941 |
2,168,034 |
|
|
|
Depreciation and amortisation charges |
(3,297,323) |
(3,409,994) |
(1,056,517) |
(1,384,957) |
|
|
|
Operating profit before finance and tax |
21,424,156 |
5,378,921 |
10,689,424 |
783,077 |
|
|
|
|
|
|
|
|
|
|
|
Profit after tax |
17,837,221 |
4,620,779 |
8,615,387 |
(359,112) |
|
|
|
Earnings per ordinary share (basic) |
23.55c |
6.10c |
11.38c |
0.47c |
|
|
|
|
|
|
|
|
|
|
|
Average gold price received (US$/oz) |
US$2,338 |
US$1,940 |
US$2,478 |
US$1,930 |
|
|
|
|
|
|
As at
30 September
2024
US$
(unaudited) |
As at
31 December
2023
US$
(audited) |
|
Cash and cash equivalents |
|
|
20,029,407 |
11,552,031 |
|
Net funds (after finance debt obligations) |
|
|
14,007,367 |
5,148,947 |
|
Net assets |
|
|
103,439,147 |
92,792,049 |
|
|
|
|
|
|
|
Cash Cost and All-In Sustaining Cost (“AISC”) |
|
|
|
|
|
|
|
9 months to
30 September
2024 |
9 months to
30 September
2023 |
12 months to 31 December 2023 |
|
Gold production for cash cost and AISC
purposes |
|
27,499 ozs |
25,262 ozs |
33,152 ozs |
|
|
|
|
|
|
|
Total Cash Cost of production (per ounce) |
|
US$1,405 |
US$1,253 |
US$1,300 |
|
Total AISC of production (per ounce) |
|
US$1,790 |
US$1,553 |
US$1,635 |
Engage Investor Presentation – 3
December 2024
Shareholders and investors are advised that Mike Hodgson, Chief
Executive Officer of the Company will provide a live interactive
presentation via the Engage Investor platform, on the 3rd of
December at 2:30pm GMT.
Serabi Gold plc welcomes all current shareholders and
interested investors to join and encourages investors to pre-submit
questions. Investors can also submit questions at any
time during the live presentation.
Investors can sign up to Engage Investor at no cost and
follow Serabi Gold plc from their personalised investor
hub.
Shareholders and investors can register interest in this event
using the following link - https://engageinvestor.news/SRB_Ei
The information contained within this
announcement is deemed by the Company to constitute inside
information as stipulated under the Market Abuse Regulations (EU)
No. 596/2014 as it forms part of UK Domestic Law by virtue of the
European Union (Withdrawal) Act 2018.
The person who arranged for the release of this
announcement on behalf of the Company was Clive Line, Director.
Enquiries
SERABI GOLD plc
Michael
Hodgson t
+44 (0)20 7246 6830
Chief
Executive m
+44 (0)7799 473621
Clive
Line t
+44 (0)20 7246 6830
Finance
Director m
+44 (0)7710 151692
Andrew Khov
m
+1 647 885 4874
Vice President, Investor Relations &
Business Development
e
contact@serabigold.com
www.serabigold.com
BEAUMONT CORNISH Limited
Nominated Adviser & Financial Adviser
Roland Cornish / Michael
Cornish t
+44 (0)20 7628 3396
PEEL HUNT LLP
Joint UK Broker
Ross
Allister t
+44 (0)20 7418 9000
TAMESIS PARTNERS LLP
Joint UK Broker
Charlie Bendon/ Richard
Greenfield t
+44 (0)20 3882 2868
CAMARCO
Financial PR - Europe
Gordon Poole / Emily
Hall t
+44 (0)20 3757 4980
HARBOR ACCESS
Financial PR – North America
Jonathan Patterson / Lisa
Micali t
+1 475 477 9404
Copies of this announcement are available from
the Company's website at www.serabigold.com.
Forward-looking statements
Certain 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.
Qualified Persons Statement
The 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 35 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, recognizing 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.
Notice
Beaumont Cornish Limited, which is authorised and regulated in the
United Kingdom by the Financial Conduct Authority, is acting as
nominated adviser to the Company in relation to the matters
referred herein. Beaumont Cornish Limited is acting exclusively for
the Company and for no one else in relation to the matters
described in this announcement and is not advising any other person
and accordingly will not be responsible to anyone other than the
Company for providing the protections afforded to clients of
Beaumont Cornish Limited, or for providing advice in relation to
the contents of this announcement or any matter referred to in
it.
Neither the Toronto Stock Exchange, nor any other securities
regulatory authority, has approved or disapproved of the contents
of this news release.
See
www.serabigold.com for more information
and follow us on twitter @Serabi_Gold
The following information, comprising, the
Income Statement, the Group Balance Sheet, Group Statement of
Changes in Shareholders’ Equity, and Group Cash Flow, is extracted
from the unaudited interim financial statements for the three and
nine months to 30 September 2024.
Statement of Comprehensive Income
For the three and nine-month periods ended 30 September 2024.
|
|
|
For the three months ended
30 September |
For the nine months ended
30 September |
| |
|
2024 |
2023 |
2024 |
2023 |
|
(expressed in US$) |
Notes |
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
|
CONTINUING OPERATIONS |
|
|
|
|
|
| Revenue |
|
27,626,034 |
17,373,682 |
70,290,641 |
47,897,264 |
| Cost of sales |
|
(14,160,734) |
(11,769,256) |
(39,840,803) |
(32,463,690) |
| Stock impairment
provision |
|
— |
— |
— |
(370,000) |
|
Depreciation and amortisation charges |
2 |
(1,056,517) |
(2,957,149) |
(3,297,323) |
(4,982,186) |
|
Total cost of sales |
|
(15,217,251) |
(14,726,405) |
(43,138,126) |
(37,815,876) |
|
Gross profit |
|
12,408,783 |
2,647,277 |
27,152,515 |
10,081,388 |
| Administration expenses |
|
(1,679,357) |
(1,934,235) |
(5,484,788) |
(4,834,129) |
| Share-based payments |
|
(65,010) |
(52,151) |
(183,902) |
(138,017) |
| Gain on
disposal of assets |
|
25,008 |
122,186 |
(59,669) |
269,679 |
|
Operating profit |
|
10,689,424 |
783,077 |
21,424,156 |
5,378,921 |
| Other income – exploration
receipts |
3 |
__ |
1,992,344 |
351,186 |
3,042,879 |
| Other expenses – exploration
expenses |
3 |
__ |
(1,856,520) |
(317,746) |
(2,876,431) |
| Foreign exchange
gain/(loss) |
|
129,429 |
(43,421) |
(690,927) |
56,645 |
| Finance expense |
4 |
(127,729) |
(381,478) |
(438,032) |
(500,588) |
| Finance
income |
4 |
109,262 |
199,792 |
345,727 |
703,823 |
|
Profit/(loss) before taxation |
|
10,800,386 |
693,794 |
20,674,364 |
5,805,249 |
| Income
tax expense |
5 |
(2,184,999) |
(1,052,906) |
(2,837,143) |
(1,184,470) |
|
Profit/(loss) after taxation |
|
8,615,387 |
(359,112) |
17,837,221 |
4,620,779 |
|
|
|
|
|
|
|
| Other comprehensive
income (net of tax) |
|
|
|
|
|
| |
|
|
|
|
|
|
Exchange differences on translating foreign operations |
|
808,689 |
(2,952,047) |
(7,374,025) |
1,751,104 |
|
Total comprehensive profit/(loss) for the
period(1) |
|
9,424,076 |
(3,311,159) |
10,463,196 |
6,371,883 |
|
|
|
|
|
|
|
|
Profit/(loss) per ordinary share (basic) |
6 |
11.38c |
(0.47c) |
23.55c |
6.10c |
|
Profit/(loss) per ordinary share (diluted) |
6 |
11.38c |
(0.47c) |
23.55c |
6.10c |
(1)
The Group has no
non-controlling interest and all profits are attributable to the
equity holders of the Parent Company
Balance Sheet as at 30 September
2024
|
(expressed in US$) |
|
|
As at
30 September 2024
(unaudited) |
As at
30 September 2023
(unaudited) |
As at
31 December 2023
(audited) |
|
Non-current assets |
|
|
|
|
|
| Deferred exploration
costs |
|
|
20,211,858 |
19,775,603 |
20,499,257 |
| Property, plant and
equipment |
|
|
56,310,566 |
49,107,705 |
53,340,903 |
| Right of use assets |
|
|
4,928,263 |
5,214,315 |
5,316,330 |
| Deferred taxes |
|
|
7,110,445 |
1,520,710 |
4,653,063 |
| Taxes
receivable |
|
|
1,903,307 |
3,891,201 |
1,791,983 |
|
Total non-current assets |
|
|
90,464,439 |
79,509,534 |
85,601,536 |
|
Current assets |
|
|
|
|
|
| Inventories |
|
|
12,338,958 |
9,819,171 |
12,797,951 |
| Trade and other
receivables |
|
|
2,100,956 |
1,579,886 |
2,858,072 |
| Derivative financial
assets |
|
|
— |
197,864 |
115,840 |
| Prepayments and accrued
income |
|
|
1,633,602 |
1,750,470 |
2,320,256 |
| Cash
and cash equivalents |
|
|
20,029,407 |
15,352,099 |
11,552,031 |
|
Total current assets |
|
|
36,102,923 |
28,699,490 |
29,644,150 |
|
Current liabilities |
|
|
|
|
|
| Trade and other payables |
|
|
10,672,705 |
7,798,873 |
8,626,292 |
| Interest bearing
liabilities |
|
|
5,886,714 |
6,211,791 |
6,403,084 |
| Accruals |
|
|
431,716 |
593,435 |
649,225 |
|
Total current liabilities |
|
|
16,991,135 |
14,604,099 |
15,678,601 |
|
Net current assets |
|
|
19,111,788 |
14,095,391 |
13,965,549 |
|
Total assets less current liabilities |
|
|
109,576,227 |
93,604,925 |
99,567,085 |
|
Non-current liabilities |
|
|
|
|
|
| Trade and other payables |
|
|
3,676,181 |
3,884,102 |
3,960,920 |
| Interest bearing
liabilities |
|
|
135,326 |
304,262 |
150,224 |
| Deferred tax liability |
|
|
— |
130,967 |
— |
| Provisions |
|
|
2,325,573 |
1,252,631 |
2,663,892 |
|
Total non-current liabilities |
|
|
6,137,080 |
5,571,962 |
6,775,036 |
|
Net assets |
|
|
103,439,147 |
88,032,963 |
92,792,049 |
| Equity |
|
|
|
|
|
| Share capital |
|
|
11,213,618 |
11,213,618 |
11,213,618 |
| Share premium reserve |
|
|
36,158,068 |
36,158,068 |
36,158,068 |
| Option reserve |
|
|
359,475 |
116,246 |
175,573 |
| Other reserves |
|
|
17,609,380 |
16,167,780 |
15,960,006 |
| Translation reserve |
|
|
(69,154,766) |
(64,525,667) |
(61,780,741) |
|
Retained surplus |
|
|
107,253,372 |
88,902,918 |
91,065,525 |
|
Equity shareholders’ funds |
|
|
103,439,147 |
88,032,963 |
92,792,049 |
Statements of Changes in Shareholders’
Equity
For the nine-month period ended 30 September 2024
|
(expressed in US$) |
|
|
|
|
|
|
|
|
(unaudited) |
Share
capital |
Share
premium |
Share option reserve |
Other reserves (1) |
Translation reserve |
Retained Earnings |
Total equity |
|
Equity shareholders’ funds at 31 December
2022 |
11,213,618 |
36,158,068 |
1,324,558 |
14,459,255 |
(66,276,771) |
84,644,335 |
81,523,063 |
| Foreign currency
adjustments |
— |
— |
— |
— |
1,751,104 |
— |
1,751,104 |
| Profit
for the period |
— |
— |
— |
— |
— |
4,620,779 |
4,620,779 |
|
Total comprehensive income for the period |
— |
— |
— |
— |
1,751,104 |
4,620,779 |
6,371,883 |
| Transfer to taxation
reserve |
— |
— |
— |
1,708,525 |
— |
(1,708,525) |
— |
| Share Options Expired |
— |
— |
(1,346,329) |
— |
— |
1,346,329 |
— |
| Share
incentives expense |
— |
— |
138,017 |
— |
— |
— |
138,017 |
Equity shareholders’ funds at 30 September
2023 |
11,213,618 |
36,158,068 |
116,246 |
16,167,780 |
(64,525,667) |
88,902,918 |
88,032,963 |
|
Foreign currency adjustments |
— |
— |
— |
— |
2,744,926 |
— |
2,744,926 |
| Profit
for the period |
— |
— |
— |
— |
— |
1,954,833 |
1,954,833 |
|
Total comprehensive income for the period |
— |
— |
— |
— |
2,744,926 |
1,954,833 |
4,699,759 |
| Transfer to taxation
reserve |
— |
— |
— |
(207,774) |
— |
207,774 |
— |
| Share Options Expired |
— |
— |
— |
— |
— |
— |
— |
| Share
incentives expense |
— |
— |
59,327 |
— |
— |
— |
59,327 |
|
Equity shareholders’ funds at 31 December
2023 |
11,213,618 |
36,158,068 |
175,573 |
15,960,006 |
(61,780,741) |
91,065,525 |
92,792,049 |
|
Foreign currency adjustments |
— |
— |
— |
— |
(7,374,025) |
— |
(7,374,025) |
| Profit
for the period |
— |
— |
— |
— |
— |
17,837,221 |
17,837,221 |
|
Total comprehensive income for the period |
— |
— |
— |
— |
(7,374,025) |
17,837,221 |
10,463,196 |
| Transfer to taxation
reserve |
— |
— |
— |
1,649,374 |
— |
(1,649,374) |
— |
| Share incentives expense |
— |
— |
183,902 |
— |
— |
— |
183,902 |
Equity shareholders’ funds at 30 September
2024 |
11,213,618 |
36,158,068 |
359,475 |
17,609,380 |
(69,154,766) |
107,253,372 |
103,439,147 |
(1) Other reserves comprise a merger
reserve of US$361,461 and a taxation reserve of US$17,247,919 (31
December 2023: merger reserve of US$361,461 and a taxation reserve
of US$15,598,545).
Condensed Consolidated Cash Flow Statement
For the three and nine-month periods ended 30 September 2024
| |
For the three months
ended
30 September |
For the nine months
ended
30 September |
| |
2024 |
2023 |
2024 |
2023 |
| (expressed
in US$) |
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
|
|
|
|
|
|
| Post tax
profit/(loss) for period |
8,615,387 |
(359,112) |
17,837,221 |
4,620,779 |
| Depreciation –
plant, equipment and mining properties |
1,056,517 |
2,957,149 |
3,297,323 |
4,982,186 |
| Provision for
inventory impairment |
— |
— |
— |
370,000 |
| Gain on asset
disposals |
(25,008) |
(122,186) |
59,669 |
(269,679) |
| Net financial
expense |
(110,962) |
225,107 |
749,792 |
(259,880) |
| Provision for
taxation |
2,184,999 |
1,052,906 |
2,837,143 |
1,184,470 |
| Share-based
payments |
65,010 |
52,151 |
183,902 |
138,017 |
| Taxation paid |
(347,589) |
(415,722) |
(789,287) |
(811,612) |
| Interest paid |
(10,091) |
(22,900) |
(39,599) |
(408,714) |
| Foreign exchange
(loss) / gain |
(291,702) |
(45,098) |
(343,986) |
(117,170) |
| Changes in
working capital |
|
|
|
|
| |
Decrease/(increase) in
inventories |
217,474 |
(696,001) |
(1,049,888) |
(696,782) |
| |
Decrease/(increase)/decrease
in receivables, prepayments and accrued income |
1,238,492 |
(1,477) |
(1,002,244) |
2,763,565 |
|
|
Increase/(decrease) in payables, accruals and provisions |
979,209 |
1,550,835 |
1,384,012 |
1,798,796 |
|
Net cash inflow from operations |
13,571,736 |
4,175,652 |
23,124,058 |
13,293,976 |
|
|
|
|
|
|
| Investing
activities |
|
|
|
|
| Purchase of
property, plant and equipment and assets in construction |
(2,219,242) |
(706,419) |
(6,231,132) |
(1,686,505) |
| Mine development
expenditure |
(1,977,182) |
(1,274,305) |
(4,913,351) |
(2,613,395) |
| Geological
exploration expenditure |
(922,400) |
(101,611) |
(1,835,856) |
(459,035) |
| Pre-operational
project costs |
(393,044) |
— |
(865,728) |
— |
| Proceeds from sale
of assets |
21,474 |
123,408 |
73,955 |
314,923 |
|
Interest received |
109,262 |
101,574 |
338,895 |
181,373 |
|
Net cash outflow on investing activities |
(5,381,132) |
(1,857,353) |
(13,433,217) |
(4,262,639) |
|
|
|
|
|
|
| Financing
activities |
|
|
|
|
| Receipt of
short-term loan |
— |
— |
5,000,000 |
5,000,000 |
| Repayment of
short-term loan |
— |
— |
(5,000,000) |
(5,096,397) |
| Payment of finance
lease liabilities |
(210,366) |
(295,583) |
(708,816) |
(906,565) |
|
Net cash (outflow) / inflow from financing
activities |
(210,366) |
(295,583) |
(708,816) |
(1,002,962) |
|
|
|
|
|
|
| Net
increase / (decrease) in cash and cash equivalents |
7,980,238 |
2,022,716 |
8,982,025 |
8,028,375 |
| Cash and
cash equivalents at beginning of period |
12,041,017 |
13,285,447 |
11,552,031 |
7,196,313 |
|
Exchange difference on cash |
8,152 |
43,936 |
(504,649) |
127,411 |
|
Cash and cash equivalents at end of period |
20,029,407 |
15,352,099 |
20,029,407 |
15,352,099 |
Notes
-
Basis of preparation
1. Basis of preparation
These interim condensed consolidated financial statements are for
the three and nine month periods ended 30 September 2024.
Comparative information has been provided for the unaudited three
and nine month periods ended 30 September 2023 and, where
applicable, the audited twelve month period from 1 January 2023 to
31 December 2023. These condensed consolidated financial statements
do not include all the disclosures that would otherwise be required
in a complete set of financial statements and should be read in
conjunction with the 2023 annual report.
The condensed consolidated financial statements 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 2023 and those envisaged
for the financial statements for the year ending 31 December
2024.
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 2023 prepared in accordance
with international accounting standards in conformity with the
requirements of the Companies Act 2006 have been filed with the
Registrar of Companies. The auditor’s report on these accounts was
unqualified. The auditor’s report did not contain a statement under
Section 498 (2) or 498 (3) of the Companies Act 2006.
Accounting standards, amendments and
interpretations effective in 2024
The Group has not adopted any standards or
interpretations in advance of the required implementation
dates.
The following Accounting Standards have not yet been ratified in
UK law but are expected to be ratified during 2024. The Group
expects to make appropriate compliant disclosures in its Annual
Report for the year needed 31 December 2024.
| IFRS S1 General Requirements
for Disclosure of Sustainability-related Financial
Information |
|
| IFRS S2 Climate-related
Disclosures |
|
Amendments IAS 1 – Classification of
Liabilities as Current or Non-Current and Non Current Liabilities
with Covenants
The IASB issued amendments to IAS 1 Presentation of Financial
Statements (“IAS 1”). The amendments clarify that the
classification of liabilities as current or non-current is based on
rights that are in existence at the end of the reporting period.
Classification is unaffected by the entity’s expectation or events
after the reporting date. Covenants of loan arrangements will
affect the classification of a liability as current or non-current
if the entity must comply with a covenant either before or at the
reporting date, even if the covenant is only tested for compliance
after the reporting date. There was no significant impact on the
Company’s consolidated interim financial statements as a result of
the adoption of these amendments.
Management do not consider that the following
other amendments to existing standards are applicable to the
current operations of the Group or will have any material impact on
the financial statements.
|
Lease Liability in a Sale and Leaseback (amendments to IFRS
16) |
|
|
Supplier Finance Arrangements (amendments to IAS 7 and IFRS
17)) |
|
Certain new accounting standards and
interpretations have been published that are not mandatory for the
current period and have not been early adopted. These standards are
not expected to have a material impact on the Company’s current or
future reporting periods.
These financial statements do not constitute
statutory accounts as defined in Section 434 of the Companies Act
2006.
(i) Going
concern
On 30 September 2024 the Group held cash of US$20.03 million which
represents an increase of US$8.45 million compared to 31 December
2023.
On 7 January 2024, the Group completed a US$5.0
million unsecured loan arrangement with Itaú Bank in Brazil. The
loan is repayable as a bullet payment on 6 January 2025 and carries
an interest coupon of 8.47 per cent. The proceeds raised from the
loan are being used for working capital and secure adequate
liquidity to repay a similar arrangement which was repaid on 22
February 2024.
Management prepares, for Board review, regular
updates of its operational plans and cash flow forecasts based on
their best judgement of the expected operational performance of the
Group and using economic assumptions that the Directors consider
are reasonable in the current global economic climate. The current
plans assume that during 2024 the Group will continue gold
production from its Palito Complex operation as well as increase
production from the Coringa mine and will be able to increase gold
production to exceed the levels of 2023.
The Directors will limit the Group’s
discretionary expenditures, when necessary, to manage the Group’s
liquidity.
The Directors acknowledge that the Group remains
subject to operational and economic risks and any unplanned
interruption or reduction in gold production or unforeseen changes
in economic assumptions may adversely affect the level of free cash
flow that the Group can generate on a monthly basis. The Directors
have a reasonable expectation that, after taking into account
reasonably possible changes in trading performance, and the current
macroeconomic situation, the Group has adequate resources to
continue in operational existence for the foreseeable future. Thus,
they continue to adopt the going concern basis of accounting in
preparing the Financial Statements.
2.
Depreciation
and amortisation
Whilst the Coringa Gold Project has been in
production for some time, it is still in a development and ramp-up
stage and has not yet attained the operational scale that the Board
considers is required to be considered in Commercial Production. As
a result no amortisation charge in respect of the underlying mine
asset costs has been reflected in the financial statements to
date.
3.
Other
Income and Expenses
Under the copper exploration alliance with Vale
announced on 10 May 2023, the related exploration activities
undertaken by the Group under the management of a working committee
(comprising representatives from Vale and Serabi), were funded in
their entirety by Vale during Phase 1 of the programme. Following
the completion of Phase 1, Vale advised the Group, in April 2024,
that it did not wish to continue the exploration alliance.
Exploration and development of copper deposits
is not the core activity of the Group and further funding beyond
the Phase 1 commitment would be required before a judgment could be
made as to a project being commercially viable. There is a
significant cost involved in developing new copper deposits and it
is unlikely that, without the financial support of a partner, the
Group would independently seek to develop a copper project in
preference to any of its existing gold projects and discoveries. As
a result, both the funding received from Vale and the related
exploration expenditures has been recognised through the income
statement. As this is not a principal business activity of the
Group these receipts and expenditures are classified as other
income and other expenses.
4.
Finance
expense and income
|
|
3 months
ended
30 September 2024
(unaudited) |
3 months
ended
30 September 2023
(unaudited) |
9 months
ended
30 September 2024
(unaudited) |
9 months
ended
30 September 2023
(unaudited) |
|
|
US$ |
US$ |
US$ |
US$ |
| Loss on revaluations of
hedging derivatives |
— |
(226,883) |
— |
— |
| Interest expense on short term
loan |
(93,486) |
(106,197) |
(335,563) |
(349,515) |
| Interest expense on trade
finance |
(22,120) |
(24,267) |
(54,333) |
(66,158) |
| Interest expense on finance
leases |
— |
— |
— |
— |
| Total Financial
expense |
(12,123) |
(24,131) |
(48,136) |
(84,915) |
| |
(127,729) |
(381,478) |
(438,032) |
(500,588) |
| Gain on revaluation of hedging
derivatives |
— |
— |
— |
385,512 |
| Realised gain on hedging
derivatives |
— |
98,217 |
6,832 |
136,938 |
| Interest income |
109,262 |
101,575 |
338,895 |
181,373 |
| Total Financial
income |
109,262 |
199,792 |
345,727 |
703,823 |
| Net finance (expense)
/ income |
(18,467) |
(181,686) |
(92,305) |
203,235 |
5.
Taxation
The Group has recognised a deferred tax asset to
the extent that the Group has reasonable certainty as to the level
and timing of future profits that might be generated and against
which the asset may be recovered. The deferred tax liability
arising on unrealised exchange gains has been eliminated in the
nine-month period to 30 September 2024 reflecting the movement in
the Brazilian Real exchange rate at the end of the period and
resulting in deferred tax income of US$946,220 (nine months to 30
September 2023 – income of US$23,113).
The Group has also incurred a tax charge in
Brazil for the six-month period of US$3,783,403 (nine months to 30
September 2023 tax charge - US$1,207,583).
6. Earnings
per Share
|
|
6 months ended 30 June 2024
(unaudited) |
6 months ended 30 June 2023
(unaudited) |
3 months ended 30 June 2024
(unaudited) |
3 months ended 30 June 2023
(unaudited) |
|
Profit/(loss) attributable to ordinary shareholders (US$) |
8,615,387 |
(359,112) |
17,837,221 |
4,620,779 |
|
Weighted average ordinary shares in issue |
75,734,551 |
75,734,551 |
75,734,551 |
75,734,551 |
|
Basic profit/(loss) per share (US cents) |
11.38c |
(0.47c) |
23.55c |
6.10c |
|
Diluted ordinary shares in issue (1) |
75,734,551 |
75,734,551 |
75,734,551 |
75,734,551 |
| Diluted
profit/(loss) per share (US cents) |
11.38c |
(0.47c) |
23.55c |
6.10c |
(1) On 30 September 2024 there were 2,814,541
conditional share awards in issue (30 September 2023 – 2,075,400).
These are subject to performance conditions which may or not be
fulfilled in full or in part. These CSAs have not been included in
the calculation of the diluted earnings per share.
7. Post
balance sheet events
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
operation of the entity, the results of these operations, or the
state of affairs of the entity in future financial periods.
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