TIDMSVML
RNS Number : 0776A
Sovereign Metals Limited
31 January 2022
SOVEREIGN METALS LIMITED
31 January 2022
DECEMBER 2021 QUARTERLY REPORT
Sovereign Metals Limited (Company or Sovereign) (ASX:SVM &
AIM:SVML) is pleased to provide its quarterly report for the period
ended 31 December 2021.
HIGHLIGHTS
Initial Scoping Study confirms Kasiya as a globally significant
natural rutile project
-- The initial Scoping Study confirmed a multi-decade operation
providing a stable supply of highly sought-after rutile (TiO(2) )
and graphite whilst contributing significantly to the economy of
Malawi
-- Kasiya is the largest undeveloped rutile deposit in the world
and is highly strategic in a market characterised by extreme supply
deficit. The Scoping Study demonstrated outstanding results
including:
o a 12Mtpa operation producing 122kt rutile and 80kt graphite per annum over a 25 year mine life
o exceptional economics including a post-tax NPV(8) of US$861m and post-tax IRR of 36%
o a large-scale operation with a low-cost profile resulting from
the deposit's near surface nature, grade and excellent existing
infrastructure
o a low carbon operation with the project to be powered by 100% renewables (hydro and solar)
-- The Project is positioned for substantial growth with the
current life-of-mine inventory covering only 38% of the
drill-defined mineralised footprint. Substantial additional
resource growth is expected in early 2022 to enable the Study to be
enhanced
-- Sovereign is aiming to develop an environmentally and
socially sustainable operation to supply natural rutile that can
displace carbon, energy & waste intensive alternatives like
synthetic rutile and titania slag
Mineral Resource Estimate (MRE) upgrade to support Scoping
Study
-- During the quarter, the Company reported a MRE upgrade with
over 50% now in the higher confidence Indicated category
-- The MRE upgrade was underpinned by results from the core
drilling program completed during the quarter, which confirmed the
thick, continuous and high-grade nature of the deposit
-- The upgraded MRE contains 3.1Mt of rutile in the Indicated
category and 2.8Mt of rutile in the Inferred category
Outstanding metallurgy
-- Bulk scale metallurgy test-work demonstrated very high
recoveries of premium quality rutile products and a high-grade,
coarse flake graphite by-product
-- World-class specification rutile products ranging from 95.0%
to 97.2% TiO(2) with low impurities and stand-out recoveries
ranging from 100% to 94%
Commencement of trading on the AIM Market
-- On 14 December 2021, the Company's shares were admitted to
the AIM market of the London Stock Exchange
-- The dual listing has increased the Company's profile in the
northern hemisphere and facilitated the participation of UK and
other European investors in Sovereign's growth
ENQUIRIES
Dr Julian Stephens (Perth) Sam Cordin (Perth) Sapan Ghai (London)
Managing Director +61(8) 9322 6322 +44 207 478 3900
+61(8) 9322 6322
Nominated Adviser on AIM
RFC Ambrian
Bhavesh Patel / Andrew Thomson +44 20 3440 6800
Broker
Optiva Securities +44 20 3137 1902
Daniel Ingrams
Mariela Jaho
Christian Dennis
To view the announcement in full including all illustrations and
figures, please refer to the full announcement at
http://sovereignmetals.com.au/announcements/
SCOPING STUDY
During the quarter, Sovereign reported the initial Scoping Study
which confirmed Kasiya as a globally significant natural rutile
project. Kasiya is the largest undeveloped rutile deposit in the
world and is highly strategic in a market characterised by extreme
current and forecast supply deficit.
The Study developed the concept for a multi-decade mine
providing a stable supply of a highly sought-after TiO(2) and
graphite whilst contributing significantly to the economy of
Malawi.
Exceptional Economics
-- Initial Scoping Study demonstrates globally significant &
strategic project with low capital costs & high returns
-- Positioned as one of the world's best undeveloped titanium minerals projects
Positioned for growth
-- The life-of-mine inventory covers just 38% of the drill defined mineralised footprint
-- Substantial additional resource growth expected in early 2022
to enable the Study to be enhanced
Sustainable and ESG Driven
-- Significant contribution to Malawi via fiscal returns,
employment, training & social development
-- Low carbon footprint operation - hydro & solar power supply
Critical raw materials reducing carbon emissions
-- Low carbon - natural rutile can displace carbon, energy & waste intensive alternatives
-- Graphite is a major mineral required for lithium-ion
batteries for electric vehicles which are key components required
for the clean energy transition
Rutile market in structural supply deficit
-- Current supply declining with very limited additional production in the pipeline
-- The current severe structural supply deficit in natural
rutile is forecast to continue to widen in the medium & long
term
Strong relationships
-- Significant support from the government of Malawi for the development of Kasiya
-- Highly supportive community to benefit from project development
-- Establishing relationships with off-takers with significant interest already received
Exceptional Economics
The Scoping Study demonstrates Kasiya as a globally significant
natural rutile project with exceptional economics, including low
capital and operating costs, resulting in a high margin
operation.
NPV(8) IRR EBITDA
(after-tax) (after-tax) (Annual average LoM)
US$861m 36% US$161m
CAPITAL COST ANNUAL OPERATING COST
THROUGHPUT (per tonne mined)
US$332m 12Mt US$5.96/t
MINE LIFE NPV(8) /CAPEX OPERATING COST
(per tonne product)
25 years 2.6 US$352/t
Overview
Sovereign is aiming to develop an environmentally and socially
sustainable operation to supply highly sought-after natural rutile
and graphite to global markets.
The proposed large-scale operation will process soft, friable
mineralisation mined from surface. The Project has excellent
surrounding infrastructure including bitumen roads, a high-quality
rail line connecting to the deep-water of Nacala on the Indian
Ocean and hydro-sourced grid power.
The operation will primarily employ conventional hydro-mining to
produce a slurry that is pumped to a Wet Concentration Plant (WCP)
where the material is sized. A Heavy Mineral Concentrate (HMC) is
produced via processing the sand fraction through a series of
gravity spirals. The HMC is transferred to the dry Mineral
Separation Plant (MSP) where premium quality rutile is produced via
electrostatic and magnetic separation.
Graphite rich concentrate is collected from the gravity spirals
and processed in a separate graphite flotation plant, producing a
coarse-flake graphite product.
The rutile and graphite products will be trucked a short
distance via existing bitumen roads to the Kanengo rail terminal
from where they will be railed via the Nacala Logistics Corridor
(NLC) to the deep-water port of Nacala on the eastern seaboard of
Mozambique.
Low-Cost Operation
Kasiya's low costs are achieved through deposit size and grade,
location and infrastructure. Central Malawi boasts excellent
existing infrastructure including hydropower and an extensive
sealed road network. The Kasiya Rutile Project is strategically
located in close proximity to the capital city of Lilongwe,
providing access to a skilled workforce and industrial
services.
The existing quality logistics route to the Indian Ocean
deep-water port of Nacala, via the NLC, for the export of products
to global markets provides significant capital cost savings
compared to many other undeveloped projects.
The soft, friable and high-grade mineralisation occurring from
surface results in no waste stripping requirement and the
amenability to hydro-mining means the mining cost component is kept
relatively low.
Capital Costs
Capital estimates for the Project have been prepared by DRA
Global Ltd, together with input from the Company, using a
combination of cost estimates from suppliers, historical data,
benchmarks and other independent sources. The intended accuracy of
the capital cost estimate for the Project is +/-30%. A summary of
the capital cost breakdown is presented in Table 1 below.
Table 1: Capital Cost Estimate
Description US$m
Direct
================================ =======
Mining $2.4
================================ =======
Plant - Rutile $93.5
================================ =======
Plant - Graphite $34.1
================================ =======
Infrastructure $88.5
================================ =======
Total Directs $218.4
================================ =======
Indirects
================================ =======
EPCM $26.7
================================ =======
Owners Cost $16.1
================================ =======
Miscellaneous $12.9
================================ =======
Contingency $57.6
================================ =======
Total Indirects $113.3
================================ =======
Total Start-up Capital $331.7
================================ =======
Operating Costs
The operating costs for the production of rutile and graphite at
Kasiya over the life-of-mine is presented in Table 2 below.
Table 2: Operating Estimate
Description US$ US$
Mined Tonne Product
Mining $1.77 $104
============================= ============ ========
Processing - Rutile $2.00 $119
============================= ============ ========
Processing - Graphite $0.69 $40
============================= ============ ========
General & Administration $0.64 $38
============================= ============ ========
Total Mine Gate $5.10 $301
============================= ============ ========
Logistics $0.86 $51
============================= ============ ========
Total Operating Costs $5.96 $352
============================= ============ ========
The revenue-to-cash cost ratio of 2.8x and the average annual
revenue to capital cost ratio positions Kasiya in the first
quartile compared to other undeveloped mineral sands
operations.
Positioned For Growth
The current mining inventory for the Scoping Study covers only
49km(2) or 38% of the total drill-defined area of high-grade rutile
mineralisation of 129km(2) . The Company expects to be able to
materially increase the overall MRE tonnage in early 2022 which
will enable the Study options to be reviewed in terms of potential
for scale ups or mine life extensions beyond the current 25
years.
The objective of this Study was to provide an initial
technically validated concept that will be scalable in future.
Through the Study process, a number of opportunities and options
were identified to enable potential increases in production rates
via additional mining units, plant modifications or modular
additions.
Key Scoping Study Outcomes
The Scoping Study demonstrates an economically robust natural
rutile project with the following key metrics:
Table 3: Key Scoping Study Outcomes
Outcome Unit Kasiya Rutile Project
NPV(8) (real post-tax) US$ $861m
===================================== ====================== ======================
NPV(10) (real post-tax) US$ $684m
===================================== ====================== ======================
IRR (post-tax) % 36%
===================================== ====================== ======================
Capital Costs US$ $332m
===================================== ====================== ======================
Operating Costs US$ per tonne mined $5.96
===================================== ====================== ======================
Operating Costs US$ per product $352
===================================== ====================== ======================
Revenue to Cost Ratio 2.8
============================================================= ======================
NPV(8) / Capital Costs 2.6
============================================================= ======================
Annual Throughput Tonnes 12,000,000
===================================== ====================== ======================
Life of Mine 25 years
===================================== ===================== ======================
Annual Production - rutile Tonnes 122,000
===================================== ====================== ======================
Annual Production - graphite Tonnes 80,000
===================================== ====================== ======================
Total Revenue (LoM) US$ $6,266m
===================================== ====================== ======================
Revenue - annual (average LoM) US$ $251m
===================================== ====================== ======================
EBITDA - annual US$ $161m
===================================== ====================== ======================
EBITDA - annual (first 5 years) US$ $192m
===================================== ====================== ======================
Payback 2.5 years
===================================== ===================== ======================
Government Royalties (LoM) US$ $313m
===================================== ====================== ======================
Corporate Taxes (LoM) US$ $1,074m
===================================== ====================== ======================
MRE UPGRADE
During the quarter, the Company reported an upgrade of over 50%
of the MRE into the higher confidence Indicated category (Table
4.). The MRE upgrade was underpinned by the results from the core
drilling program completed during the quarter, with the results
from the program confirming the thick, continuous and high-grade
nature of the deposit.
The MRE has broad zones of very high-grade rutile which occur
contiguously across large areas. Rutile mineralisation lies in
laterally extensive, near surface, flat "blanket" style bodies in
areas where the weathering profile is preserved and not
significantly eroded. At Kasiya, high-grade mineralisation commonly
grading 1.2% to 2.0% rutile occurs in the top 3-5m from surface.
Moderate grade mineralisation generally grading 0.5% to 1.2% rutile
commonly extends from 5m to end of hole where it remains open at
depths >10m in numerous drill-defined, NE-striking zones.
Table 4: Kasiya Mineral Resource Estimate at 0.7% Rutile Cut-off
Mineral Resource Material Tonnes Rutile (%) Rutile Tonnes TGC (%) TGC Tonnes
Category (millions) (millions) (millions)
Indicated 304 1.02 3.1 1.31 4.0
================== ================ =========== ============== ======== ============
Inferred 301 0.93 2.8 1.16 3.5
================== ================ =========== ============== ======== ============
Total 605 0.98 5.9 1.24 7.5
================== ================ =========== ============== ======== ============
Cut-off: 0.7% rutile, TGC = total graphitic carbon
BULK METALLURGY
During the quarter, the Company completed further bulk scale
metallurgy testwork. The testwork confirmed the previous
outstanding metallurgical results with minor modifications to the
process flowsheet resulting in very high recoveries of premium
quality rutile products and a high-grade, coarse flake graphite
by-product.
Premium grade rutile can be produced via a simple and
conventional process flow sheet. World-class product chemical
specifications are reported at 95.0% to 97.2% TiO(2) with low
impurities and stand-out metallurgical recoveries ranging from 94%
to 100%.
The testwork program was conducted at globally recognised Allied
Mineral Laboratories (AML) in Perth, Australia. A 1.6 tonne
mineralised sample was produced from a composite of multiple drill
holes across the core areas of the Kasiya Rutile Deposit. The
sample was selected to be representative of run-of-mine material
and had a head grade of 1.19% rutile and 1.07% graphite.
A graphite gravity pre-concentrate taken from rutile spiral
tails is upgraded into a coarse flake graphite by-product via a
conventional flotation flowsheet.
This was confirmed with a testwork program at SGS Lakefield in
Canada, with a very coarse-flake and high-grade graphite product at
96% TGC produced. This product has over 60% in the large to
super-jumbo fractions (+180<MU>m) with overall graphite
recovery from the raw sample to product of 62%.
The rutile and graphite mineralisation at Kasiya is amenable to
processing via conventional metallurgical flowsheets using "off the
shelf" processing equipment. Overall, the superior metallurgical
performance at Kasiya is interpreted to be due to;
-- Coarse, highly crystalline rutile grains that are naturally
well-liberated and largely free of inclusions or attachments
-- Low chemical impurities in the rutile crystal lattices
-- Simple HMC mineralogy with very little difficult-to-separate
or near-density gangue minerals present
-- Graphite is well liberated and pre-concentrates easily in the
spiral gravity separation process
The premium chemical parameters and particle sizing (d(50)
118<MU>m, 8.3% <75<MU>m for 97.2% TiO(2) product) of
the rutile produced indicates the products should be suitable for
all major natural end-use markets including TiO(2) pigment
feedstock, titanium metal and welding sectors.
Table 5: Rutile Specifications
Kasiya Products Peer Comparisons
Constituent 100% Recovery 94% Recovery Sierra Rutile Base Resources
(Iluka) (Kwale)
TiO(2) % 95.0 97.2 96.3 96.2
================ ===== ============== ============= ============== ===============
ZrO(2) +HfO(2) % 0.20 0.21 0.78 0.72
================ ===== ============== ============= ============== ===============
SiO(2) % 0.67 0.61 0.62 0.94
================ ===== ============== ============= ============== ===============
Fe(2) O(3) % 0.99 0.42 0.38 1.25
================ ===== ============== ============= ============== ===============
Al(2) O(3) % 0.45 0.38 0.31 0.23
================ ===== ============== ============= ============== ===============
Cr(2) O(3) % 0.13 0.13 0.19 0.17
================ ===== ============== ============= ============== ===============
V(2) O(5) % 0.67 0.70 0.58 0.52
================ ===== ============== ============= ============== ===============
Nb(2) O(5) % 0.37 0.39 0.15 -
================ ===== ============== ============= ============== ===============
P(2) O(5) % 0.01 0.001 0.01 0.00
================ ===== ============== ============= ============== ===============
MnO % 0.02 0.01 0.01 0.03
================ ===== ============== ============= ============== ===============
MgO % 0.003 b/d 0.01 0.10
================ ===== ============== ============= ============== ===============
CaO % 0.003 0.001 0.01 0.04
================ ===== ============== ============= ============== ===============
S % 0.01 0.01 <0.01 -
================ ===== ============== ============= ============== ===============
U+Th ppm 31 23 26 53
================ ===== ============== ============= ============== ===============
"Iluka" is Iluka Resources Limited; "Base Resources" is Base
Resources Limited. ,"-" is not disclosed.
Sources: BGR Assessment Manual titled "Heavy Minerals of
Economic Importance" 2010.
The specifications for the graphite product produced during the
test-work are also considered to be premium with the product
naturally grading over 96% TGC and with over 60% in the large to
super-jumbo fractions (+180<MU>m). The TGC and sizing
distribution are shown in Table 6 below.
Table 6: Graphite Specifications
Particle Size Carbon Weight Distribution Flake Category
Tyler Mesh Micron (<MU>) (%) (% w/w)
+32 +500 96.0 5.4 Super Jumbo
=========== ============== ======= ==================== ===============
-32 +48 -500 +300 96.6 25.1 Jumbo
=========== ============== ======= ==================== ===============
-48 +80 -300 +180 96.7 30.9 Large
=========== ============== ======= ==================== ===============
-80 +100 -180 +150 96.8 10.9 Medium
=========== ============== ======= ==================== ===============
-100 +150 -150 +106 96.11 14.4 Small/Medium
=========== ============== ======= ==================== ===============
-150 +200 -106 +75 95.8 7.5 Small
=========== ============== ======= ==================== ===============
-200 -75 93.8 5.8 Amorphous
=========== ============== ======= ==================== ===============
Total 96.3 100
=========================== ======= ==================== ===============
PRODUCT MARKETING & OFF-TAKE
The premium chemical parameters of the rutile produced indicate
the product should be suitable for all major natural end-use
markets including TiO(2) pigment feedstock, titanium metal and
welding sectors. Demand and pricing for natural rutile are both
very strong as the global structural deficit in supply continues to
widen.
The Company is ramping up product marketing with significant
interest received from tier 1 off-takers across all three market
sectors.
NEXT STEPS
The Company is targeting a number of significant milestones over
the next two quarters which include;
-- Updated MRE with substantial growth of the Indicated and
Inferred JORC MRE base expected including addition of the Nsaru
deposit
-- Revised Life Cycle Assessment (LCA) based on the Scoping
Study results to quantify the environmental impacts with a specific
focus on the low carbon footprint
-- Scoping Study update based on the expected new resource base planned for mid-2022
-- Continued product marketing and discussions with potential off-take partners
-- Commencement of ESIA field data collection and commencement
of community engagement activities
In parallel to the technical study developments on the Company's
projects, significant exploration will continue, with programs
including;
-- Infill drilling at Kasiya-Nsaru to increase MRE confidence and upgrade MRE categories
-- Deeper air-core drilling at Kasiya-Nsaru targeting the
NE-striking, higher-grade zones to depths of 25m below surface
-- Regional reconnaissance drilling targeting additional
Kasiya-like saprolite-hosted rutile mineralisation
COVID-19 IMPACT AND RESPONSE
The Company continues to proactively manage the potential impact
of Covid-19 with the health and safety of our employees,
contractors, local communities and other stakeholders being the
highest priority.
Sovereign is continuously reviewing the situation and actively
amending operations to comply with Government guidelines and
restrictions ensuring the health and safety of all members.
Currently, there is no material impact on our Malawi operations
with minor delays only continued to be experienced in the
international transportation of samples.
CORPORATE
Sovereign is well positioned with approximately A$3.7m of cash
at bank at the end of the quarter. The strong cash position allows
the Company to continue exploration and development activities on
its rutile projects.
In December, the Company's securities commenced trading on the
AIM Market of the London Stock Exchange. The completion of the dual
listing aims to raise the Company's profile in the northern
hemisphere and facilitate the participation of UK and other
European investors in Sovereign's growth.
Subsequent to the quarter, Sovereign successfully secured GBP1
million gross proceeds (A$1.9 million) from UK investors following
its listing on the AIM market of the London Stock Exchange
(Placement).
The Placement has enhanced the Company's shareholder base on the
AIM market with the net proceeds to be used for further exploration
activities in 2022 at Sovereign's globally significant Kasiya
Rutile Project.
RELATED PARTY PAYMENTS
During the quarter ended 31 December 2021, the Company made
payments of $197,000 to related parties and their associates. These
payments relate to existing remuneration arrangements (executive
salaries, director fees and superannuation of $95,000), business
development services ($27,000) and provision of serviced office
facilities, company secretarial services and administration
services ($75,000).
MINING EXPLORATION EXPITURES
During the quarter, the Company made the following payments in
relation to mining exploration activities:
Activity A$'000
------------------------------------------------------- -------------
Drilling (321)
Assaying and Metallurgical Test-work (344)
Resource Estimation and Studies (572)
Field Supplies, Equipment, Vehicles (54)
Tenement Rents and Rates (6)
Malawi Operations - Site Office, Personnel and Travel (552)
Total as reported in Appendix 5B (1,849)
------------------------------------------------------- -------------
There were no mining or production activities and expenses
incurred during the quarter ended 31 December 2021.
Competent Person Statement
The information in this announcement that relates to Production
Targets, Processing, Infrastructure and Capital and Operating
Costs, is extracted from the announcement dated 16 December 2021
entitled 'Kasiya Scoping Study Confirms Globally Significant
Natural Rutile Project' (Announcement). Sovereign confirms that: a)
it is not aware of any new information or data that materially
affects the information included in the announcement; b) all
material assumptions and technical parameters underpinning the
Production Target, and related forecast financial information
derived from the Production Target included in the Announcement
continue to apply and have not materially changed; and c) the form
and context in which the relevant Competent Persons' findings are
presented in this presentation have not been materially modified
from the Announcement.
The information in this announcement that relates to the Mineral
Resource Estimate is extracted from the announcement dated 16
December 2021. The announcement is available to view on
www.sovereignmetals.com.au . Sovereign confirms that a) it is not
aware of any new information or data that materially affects the
information included in the announcement; b) all material
assumptions included in the announcement continue to apply and have
not materially changed; and c) the form and context in which the
relevant Competent Persons' findings are presented in this report
have not been materially changed from the announcement.
The information in this announcement that relates to the
Metallurgy is extracted from the announcement dated 7 December
2021. The announcement is available to view on
www.sovereignmetals.com.au . Sovereign confirms that a) it is not
aware of any new information or data that materially affects the
information included in the announcement; b) all material
assumptions included in the announcement continue to apply and have
not materially changed; and c) the form and context in which the
relevant Competent Persons' findings are presented in this report
have not been materially changed from the announcement.
Forward Looking Statement
This release may include forward-looking statements, which may
be identified by words such as "expects", "anticipates",
"believes", "projects", "plans", and similar expressions. These
forward-looking statements are based on Sovereign's expectations
and beliefs concerning future events. Forward looking statements
are necessarily subject to risks, uncertainties and other factors,
many of which are outside the control of Sovereign, which could
cause actual results to differ materially from such statements.
There can be no assurance that forward-looking statements will
prove to be correct. Sovereign makes no undertaking to subsequently
update or revise the forward-looking statements made in this
release, to reflect the circumstances or events after the date of
that release.
Authorisation Statement
This announcement has been approved and authorised for release
by the Company's Managing Director, Julian Stephens.
APPIX 1: SUMMARY OF MINING TENEMENTS
As at 31 December 2021, the Company had an interest in the
following tenements:
Table 7: Summary of Sovereign's Licences
Licence Holding Interest Status Expiry Licence Comments
Entity Area (km(2)
)
EL0372 SSL 100% Exploration 13/03/2022 729.2 Granted
========= ========= ========= ============ =========== ============= =========
EL0492 SSL 100% Exploration 29/01/2023 935.4 Granted
========= ========= ========= ============ =========== ============= =========
EL0528 SSL 100% Exploration 27/11/2021 16.2 Granted*
========= ========= ========= ============ =========== ============= =========
EL0545 SSL 100% Exploration 12/05/2022 53.2 Granted
========= ========= ========= ============ =========== ============= =========
EL0561 SSL 100% Exploration 15/09/2023 124.0 Granted
========= ========= ========= ============ =========== ============= =========
EL0574 SSL 100% Exploration 15/09/2023 292.0 Granted
========= ========= ========= ============ =========== ============= =========
EL0582 SSL 100% Exploration 15/09/2023 285.0 Granted
========= ========= ========= ============ =========== ============= =========
EL0609 MML 100% Exploration 25/09/2024 440.5 Granted
========= ========= ========= ============ =========== ============= =========
RL0012 SSL 100% Exploration 26/07/2026 6.0 Granted
========= ========= ========= ============ =========== ============= =========
SSL: Sovereign Services Limited & MML: McCourt Mining
Limited
*EL0528 currently under application for renewal
Appendix 5B
Mining exploration entity or oil and gas exploration entity
quarterly cash flow report
Name of entity
-----------------------------------------------------
Sovereign Metals Limited
ABN Quarter ended ("current quarter")
--------------- ----------------------------------
71 120 833 427 31 December 2021
----------------------------------
Consolidated statement of cash Current quarter Year to date
flows (6 months)
$A'000 $A'000
1. Cash flows from operating
activities
1.1 Receipts from customers - -
1.2 Payments for
(a) exploration & evaluation (1,849) (3,278)
(b) development - -
(c) production - -
(d) staff costs (264) (568)
(e) administration and corporate
costs (288) (624)
1.3 Dividends received (see note - -
3)
1.4 Interest received 4 10
1.5 Interest and other costs of - -
finance paid
1.6 Income taxes paid - -
1.7 Government grants and tax - -
incentives
1.8.1 Other - R&D Tax Refund - -
1.8.2 Other - Business Development (154) (297)
---------------- -------------
Net cash from / (used in)
1.9 operating activities (2,551) (4,757)
----------------- ----------------------------------- ---------------- -------------
2. Cash flows from investing
activities
2.1 Payments to acquire or for:
(a) entities - -
(b) tenements - -
(c) property, plant and equipment (25) (170)
(d) exploration & evaluation - -
(e) investments - -
(f) other non-current assets - -
2.2 Proceeds from the disposal
of:
(a) entities - -
(b) tenements - -
(c) property, plant and equipment - -
(d) investments - -
(e) other non-current assets - -
2.3 Cash flows from loans to other - -
entities
2.4 Dividends received (see note - -
3)
2.5 Other (provide details if - -
material)
---------------- -------------
Net cash from / (used in)
2.6 investing activities (25) (170)
----------------- ----------------------------------- ---------------- -------------
3. Cash flows from financing
activities
3.1 Proceeds from issues of equity
securities (excluding convertible
debt securities) - -
3.2 Proceeds from issue of convertible - -
debt securities
Proceeds from exercise of
3.3 options 460 720
Transaction costs related
to issues of equity securities
3.4 or convertible debt securities - (5)
3.5 Proceeds from borrowings - -
3.6 Repayment of borrowings - -
3.7 Transaction costs related - -
to loans and borrowings
3.8 Dividends paid - -
3.9 Other (provide details if - -
material)
---------------- -------------
Net cash from / (used in)
3.10 financing activities 460 715
----------------- ----------------------------------- ---------------- -------------
4. Net increase / (decrease)
in cash and cash equivalents
for the period
Cash and cash equivalents
4.1 at beginning of period 5,863 7,959
Net cash from / (used in)
operating activities (item
4.2 1.9 above) (2,551) (4,757)
Net cash from / (used in)
investing activities (item
4.3 2.6 above) (25) (170)
Net cash from / (used in)
financing activities (item
4.4 3.10 above) 460 715
4.5 Effect of movement in exchange - -
rates on cash held
---------------- -------------
Cash and cash equivalents
4.6 at end of period 3,747 3,747
----------------- ----------------------------------- ---------------- -------------
5. Reconciliation of cash and Current quarter Previous quarter
cash equivalents $A'000 $A'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 59 114
5.2 Call deposits 3,688 5,749
5.3 Bank overdrafts - -
5.4 Other (provide details) - -
---------------- -----------------
Cash and cash equivalents
at end of quarter (should
5.5 equal item 4.6 above) 3,747 5,863
----------------- ----------------------------------- ---------------- -----------------
6. Payments to related parties of the entity Current quarter
and their associates $A'000
Aggregate amount of payments to related
parties and their associates included in
6.1 item 1 197
----------------
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 $A'000
arrangements available to $A'000
the entity. Add notes as necessary
for an understanding of the
sources of finance available
to the entity.
7.1 Loan facilities - -
------------------- ----------------
7.2 Credit standby arrangements - -
------------------- ----------------
7.3 Other (please specify) - -
------------------- ----------------
7.4 Total financing facilities - -
------------------- ----------------
7.5 Unused financing facilities available at -
quarter end
----------------
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.
----------------- ---------------------------------------------------------------------------
-
-----------------
8. Estimated cash available for future operating $A'000
activities
Net cash from / (used in) operating activities
8.1 (item 1.9) (2,551)
8.2 (Payments for exploration & evaluation classified -
as investing activities) (item 2.1(d))
8.3 Total relevant outgoings (item 8.1 + item (2,551)
8.2)
8.4 Cash and cash equivalents at quarter end 3,747
(item 4.6)
8.5 Unused finance facilities available at quarter -
end (item 7.5)
--------
8.6 Total available funding (item 8.4 + item 3,747
8.5)
--------
Estimated quarters of funding available
8.7 (item 8.6 divided by item 8.3) 1.5
--------
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?
-------------------------------------------------------------------
Answer: Yes
-------------------------------------------------------------------
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?
-------------------------------------------------------------------
Answer: Yes, as announced to ASX on 22 December 2021,
the Company successfully completed a bookbuild and secured
commitments for gross proceeds of GBP1 million (A$1.9
million) from UK investors following its recent listing
on the AIM market of the London Stock Exchange. Additionally,
the Company has a number of unlisted options on issue,
expiring at various dates in the next six months to 31
July 2022 which if exercised would generate a further
A$6.16 million in funding.
-------------------------------------------------------------------
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?
-------------------------------------------------------------------
Answer: Yes - refer to question 8.8.2.
-------------------------------------------------------------------
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.
----------------- -------------------------------------------------------------------
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: 31 January 2022
Authorised by: Company Secretary
(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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END
MSCBBMTTMTJJMLT
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January 31, 2022 01:59 ET (06:59 GMT)
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