Unaudited interim results for the three-and six-month
periods ended 30 June 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
six-month periods ended 30 June 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/3X0HLgx
“This has been another period of good financial
performance,” said Clive Line, Serabi’s CFO. “EBITDA of $8.3
million for the latest quarter is up 76 per cent on the first
quarter of 2024 and has resulted in a year-to-date EBITDA of 13.0
million, which in turn is a 96 per cent improvement compared with
the first six months of 2023. The cash position of $12 million
remained steady, reflecting the continued investment in development
and ramp up of Coringa, the on-going mine development at Palito and
the investment we have made in the crushing and ore sorting plant
at the Coringa mine.
“The Company has previously reported its
continuing development of Coringa with mining now on levels 320m,
290m and 260m, whilst development continues on levels 260m, 225m
and 190m. The main ramp has almost reached the next planned 155m
level which will be opened in September. The ramp will
continue to be deepened, but with three and soon to be four
development levels ahead of production, the mine is in a very
healthy position for the planned future production expansion.
“Mine development costs of $3.0 million
represent an additional $1.6 million cost compared to the first six
months of 2023, adding approximately $163 per ounce to the AISC for
the six-month period but this up-front investment is necessary to
deliver the longer-term production growth and in turn, reduce the
long-term AISC. In addition, the Company has spent a further $4.0
million on capital equipment in the first six months of the year
which includes $1.3 million on the crushing plant and ore sorter.
Mining rates continue to increase and the 115,860 tonnes of ore
mined in the first six months of the year was a 40% increase
compared with the same period of 2023.”
Financial Highlights (all
currency amounts are expressed in US Dollars unless otherwise
stated)
- Gold production for the first half
of 2024 of 18,010 ounces, (2023: 16,524 ounces).
- Cash held on 30 June 2024 of $12.0
million (31 December 2023: $11.6 million including US$0.6 million
relating to the exploration alliance with Vale).
- EBITDA for the six-month period of
$13.0 million (2023: $6.6 million).
- Post-tax profit for the six-month
period of $9.2 million (2023: $5.0 million),
- Profit per share of 12.18 cents
compared with a profit per share of 6.58 cents for the same six
month period of 2023.
- Net cash inflow from operations for
the six-month period (after mine development expenditure of US$3.0
million) of US$6.6 million (2023: US$5.8 million inflow, after mine
development expenditure of US$1.3 million)).
- Average gold price of US$2,209 per
ounce received on gold sales during the six month period (2023:
US$1,940).
- Cash Cost for the six-month period
to 30 June 2024 of US$1,401 per ounce (six months 2023: US$1,258
per ounce).
- All-In Sustaining Cost for the
six-month period to 30 June 2024 of US$1,782 per ounce (six months
2023: US$1,519 per ounce).
Overview of the financial
results
In the first half of 2024, the Group has
reported revenue and operating costs related to the sale of 18,535
ounces in the period (18,010 ounces produced). This compares to
sales reported of only 15,356 ounces in the first half of 2023.
Reported revenues and costs reflect the ounces sold in each period
and as a result total costs for the six-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$5 million loan with Itaú Bank in
Brazil. This new arrangement has an interest coupon of 8.47 per
cent and is repayable as a bullet payment on 6 January 2025. This
replaced a similar loan arranged with Santander Bank in Brazil that
was repaid during the month of February 2024.
The ore sorter for Coringa has now been
delivered to site and the ground works required for installing the
crushing plant and the related infrastructure for the ore sorter
are progressing well with the intention that the plant can be
operational during the fourth quarter of this year, processing some
of the lower grade material that has been stockpiled at Coringa and
boosting gold production in that last three-month period.
Key Financial Information
SUMMARY FINANCIAL STATISTICS FOR THE THREE-AND SIX MONTHS
ENDING 30 JUNE 2024 |
|
6 months to30 June
2024US$(unaudited) |
6 months to30 June 2023US$(unaudited) |
3 months to30 June
2024US$(unaudited) |
3 months to30 June 2023US$(unaudited) |
|
|
Revenue |
42,664,607 |
30,523,582 |
22,418,207 |
17,086,213 |
|
|
Cost of sales |
(25,680,069) |
(21,064,434) |
(12,123,470) |
(11,297,431) |
|
|
Gross operating profit |
16,984,538 |
9,459,148 |
10,294,737 |
5,788,782 |
|
|
Administration and share based payments |
(4,009,000) |
(2,838,267) |
(2,024,010) |
(1,483,692) |
|
|
EBITDA |
12,975,538 |
6,620,881 |
8,270,727 |
4,305,090 |
|
|
Depreciation and amortisation charges |
(2,240,806) |
(2,025,037) |
(1,194,245) |
(1,190,523) |
|
|
Operating profit before finance and tax |
10,734,732 |
4,595,844 |
7,076,482 |
3,114,567 |
|
|
|
|
|
|
|
|
|
Profit after tax |
9,221,834 |
4,979,891 |
5,584,271 |
3,512,412 |
|
|
Earnings per ordinary share (basic) |
12.18c |
6.58c |
7.37c |
4.64c |
|
|
|
|
|
|
|
|
|
Average gold price received (US$/oz) |
US$2,209 |
US$1,940 |
US$2,339 |
US$1,980 |
|
|
|
|
|
As at30
June2024US$(unaudited) |
As at31 December 2023US$(audited) |
Cash and cash equivalents |
|
|
12,041,017 |
11,552,031 |
Net funds (after finance debt obligations) |
|
|
6,097,781 |
5,148,947 |
Net assets |
|
|
93,950,061 |
92,792,049 |
|
|
|
|
|
Cash Cost and All-In Sustaining Cost (“AISC”) |
|
|
|
|
|
|
6 months to 30 June
2024 |
6 months to 30 June 2023 |
12 months to 31 December 2023 |
Gold production for cash cost and AISC
purposes |
|
18,010 ozs |
16,524 ozs |
33,152 ozs |
|
|
|
|
|
Total Cash Cost of production (per ounce) |
|
US$1,401 |
US$1,258 |
US$1,300 |
Total AISC of production (per ounce) |
|
US$1,782 |
US$1,519 |
US$1,635 |
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 plcMichael
Hodgson t
+44 (0)20 7246 6830Chief
Executive m
+44 (0)7799 473621
Clive
Line t
+44 (0)20 7246 6830Finance
Director m
+44 (0)7710 151692
Andrew Khov
m
+1 647 885 4874Vice President, Investor Relations & Business
Development e
contact@serabigold.com
www.serabigold.com
BEAUMONT CORNISH LimitedNominated
Adviser & Financial AdviserRoland Cornish / Michael
Cornish t
+44 (0)20 7628 3396
PEEL HUNT LLPJoint UK
BrokerRoss
Allister t
+44 (0)20 7418 9000
TAMESIS PARTNERS LLPJoint UK
BrokerCharlie Bendon/ Richard
Greenfield t
+44 (0)20 3882 2868
CAMARCOFinancial PR -
EuropeGordon Poole / Emily
Hall t
+44 (0)20 3757 4980
HARBOR ACCESS Financial PR – North
AmericaJonathan 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 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.
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
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.
NoticeBeaumont 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
six months to 30 June 2024.
Statement of Comprehensive IncomeFor the three
and six-month periods ended 30 June 2024.
|
|
For the six months ended30 June |
For the three months ended30 June |
|
|
2024 |
2023 |
2024 |
2023 |
(expressed in US$) |
Notes |
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
CONTINUING OPERATIONS |
|
|
|
|
|
Revenue |
|
42,664,607 |
30,523,582 |
22,418,207 |
17,086,213 |
Cost of sales |
|
(25,680,069) |
(20,694,434) |
(12,123,470) |
(11,297,431) |
Stock impairment provision |
|
– |
(370,000) |
– |
– |
Depreciation and amortisation charges |
|
(2,240,806) |
(2,025,037) |
(1,194,245) |
(1,190,523) |
Total cost of sales |
|
(27,920,875) |
(23,089,471) |
(13,317,715) |
(12,487,954) |
Gross profit |
|
14,743,732 |
7,434,111 |
9,100,492 |
4,598,259 |
Administration expenses |
|
(3,805,431) |
(2,899,894) |
(1,862,691) |
(1,449,726) |
Share-based payments |
|
(118,892) |
(85,866) |
(65,009) |
(37,799) |
Gain on asset disposals |
|
(84,677) |
147,493 |
(96,310) |
3,833 |
Operating profit |
|
10,734,732 |
4,595,844 |
7,076,482 |
3,114,567 |
Other income – exploration
receipts |
2 |
351,186 |
1,050,535 |
11,332 |
1,050,535 |
Other expenses – exploration
expenses |
2 |
(317,746) |
(1,019,911) |
(5,228) |
(1,019,911) |
Foreign exchange (loss)/gain |
|
(820,356) |
100,066 |
(785,790) |
17,455 |
Finance expense |
3 |
(310,303) |
(434,748) |
(135,698) |
(273,578) |
Finance income |
3 |
236,465 |
819,669 |
94,910 |
776,850 |
Profit before taxation |
|
9,873,978 |
5,111,455 |
6,256,008 |
3,665,918 |
Income tax expense |
4 |
(652,144) |
(131,564) |
(671,737) |
(153,506) |
Profit after taxation |
|
9,221,834 |
4,979,891 |
5,584,271 |
3,512,412 |
|
|
|
|
|
|
Other comprehensive
income (net of tax) |
|
|
|
|
|
|
|
|
|
|
|
Exchange differences on translating foreign operations |
|
(8,182,714) |
4,703,151 |
(6,401,786) |
3,708,904 |
Total comprehensive profit / (loss) for the
period(1) |
|
1,039,120 |
9,683,042 |
(817,515) |
7,221,316 |
|
|
|
|
|
|
Profit per ordinary share (basic) |
5 |
12.18c |
6.58c |
7.37c |
4.64c |
Profit per ordinary share (diluted) |
5 |
12.18c |
6.58c |
7.37c |
4.64c |
(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 June
2024
(expressed in US$) |
|
|
As at30 June 2024
(unaudited) |
As at30 June 2023
(unaudited) |
As at31 December
2023(audited) |
Non-current assets |
|
|
|
|
|
Deferred exploration
costs |
|
|
18,952,915 |
20,367,929 |
20,499,257 |
Property, plant and
equipment |
|
|
52,438,422 |
51,678,058 |
53,340,903 |
Right of use assets |
|
|
4,887,175 |
5,537,628 |
5,316,330 |
Taxes receivable |
|
|
5,839,555 |
4,026,439 |
4,653,063 |
Deferred taxation |
|
|
1,688,554 |
1,792,206 |
1,791,983 |
Total non-current assets |
|
|
83,806,621 |
83,402,260 |
85,601,536 |
Current assets |
|
|
|
|
|
Inventories |
|
|
13,041,361 |
9,881,514 |
12,797,951 |
Trade and other
receivables |
|
|
3,402,714 |
2,533,055 |
2,858,072 |
Prepayments and accrued
income |
|
|
2,758,307 |
1,375,685 |
2,320,256 |
Derivative financial
assets |
|
|
— |
649,209 |
115,840 |
Cash
and cash equivalents |
|
|
12,041,017 |
13,285,448 |
11,552,031 |
Total current assets |
|
|
31,243,399 |
27,724,911 |
29,644,150 |
Current liabilities |
|
|
|
|
|
Trade and other payables |
|
|
8,562,520 |
6,328,124 |
8,626,292 |
Interest bearing
liabilities |
|
|
5,943,236 |
6,430,023 |
6,403,084 |
Derivative financial
liabilities |
|
|
— |
88,755 |
— |
Accruals |
|
|
412,291 |
1,094,621 |
649,225 |
Total current liabilities |
|
|
14,918,047 |
13,941,523 |
15,678,601 |
Net current assets |
|
|
16,325,352 |
13,783,388 |
13,965,549 |
|
|
100,131,973 |
97,185,648 |
99,567,085 |
Non-current liabilities |
|
|
|
|
|
Trade and other payables |
|
|
3,738,633 |
4,111,078 |
3,960,920 |
Provisions |
|
|
2,282,580 |
1,312,689 |
2,663,892 |
Interest bearing
liabilities |
|
|
160,699 |
469,910 |
150,224 |
Total non-current liabilities |
|
|
6,181,912 |
5,893,677 |
6,775,036 |
Net assets |
|
|
93,950,061 |
91,291,971 |
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 |
|
|
294,465 |
243,002 |
175,573 |
Other reserves |
|
|
17,609,380 |
15,375,463 |
15,960,006 |
Translation reserve |
|
|
(69,963,455) |
(61,573,620) |
(61,780,741) |
Retained surplus |
|
|
98,637,985 |
89,875,440 |
91,065,525 |
Equity shareholders’ funds |
|
|
93,950,061 |
91,291,971 |
92,792,049 |
Statements of Changes in Shareholders’
EquityFor the six-month period ended 30 June 2024
(expressed in US$) |
|
|
|
|
|
|
|
(unaudited) |
Share capital |
Sharepremium |
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 |
— |
— |
— |
— |
4,703,151 |
— |
4,703,151 |
Profit
for the period |
— |
— |
— |
— |
— |
4,979,891 |
4,979,891 |
Total comprehensive income for the period |
— |
— |
— |
— |
4,703,151 |
4,979,891 |
9,683,042 |
Transfer to taxation
reserve |
— |
— |
— |
916,208 |
— |
(916,208) |
— |
Share incentives expired |
— |
— |
(1,167,422) |
— |
— |
1,167,422 |
— |
Share
incentives expense |
— |
— |
85,866 |
— |
— |
— |
85,866 |
Equity shareholders’ funds at 30 June
2023 |
11,213,618 |
36,158,068 |
243,002 |
15,375,463 |
(61,573,620) |
89,875,440 |
91,291,971 |
Foreign currency adjustments |
— |
— |
— |
— |
(207,121) |
|
(207,121) |
Profit
for the period |
— |
— |
— |
— |
|
1,595,721 |
1,595,721 |
Total comprehensive income for the period |
— |
— |
— |
— |
(207,121) |
1,595,721 |
1,388,600 |
Transfer to taxation
reserve |
— |
— |
— |
584,543 |
— |
(584,543) |
— |
Share based incentives lapsed
in period |
— |
— |
(178,907) |
— |
— |
178,907 |
— |
Share
based incentive expense |
— |
— |
111,478 |
— |
— |
— |
111,478 |
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 |
— |
— |
— |
— |
(8,182,714) |
— |
(8,182,714) |
Profit
for the period |
— |
— |
— |
— |
|
9,221,834 |
9,221,834 |
Total comprehensive income for the period |
— |
— |
— |
— |
(8,182,714) |
9,221,834 |
1,039,120 |
Transfer to taxation
reserve |
— |
— |
— |
1,649,374 |
— |
(1,649,374) |
— |
Share
option expense |
— |
— |
118,892 |
— |
— |
— |
118,892 |
Equity shareholders’ funds at 30 June
2024 |
11,213,618 |
36,158,068 |
294,465 |
17,609,380 |
(69,963,455) |
98,637,985 |
93,950,061 |
(1) Other reserves comprise a merger
reserve of US$361,461 and a taxation reserve of US$16,346,824 (31
December 2023: merger reserve of US$361,461 and a taxation reserve
of US$15,598,545).Condensed Consolidated Cash Flow
StatementFor the three and six-month periods ended 30 June
2024
|
For the six months
ended30 June |
For the three months
ended30 June |
|
2024 |
2023 |
2024 |
2023 |
(expressed
in US$) |
(unaudited) |
(unaudited) |
(unaudited) |
(unaudited) |
Operating activities |
|
|
|
|
Post tax profit
for period |
9,221,834 |
4,979,891 |
5,584,271 |
3,512,412 |
Depreciation –
plant, equipment and mining properties |
2,240,806 |
2,025,037 |
1,194,245 |
1,190,523 |
Stock impairment
provision |
— |
370,000 |
— |
— |
Net financial
expense/(income) |
860,754 |
(484,987) |
793,138 |
(520,727) |
Provision for
taxation |
652,144 |
131,564 |
671,737 |
153,506 |
Gain / (loss) on
disposals |
84,677 |
(147,493) |
96,310 |
(3,833) |
Share-based
payments |
118,892 |
85,866 |
65,009 |
37,799 |
Taxation paid |
(441,698) |
(395,890) |
(426,344) |
(109,153) |
Interest paid |
(29,508) |
(385,814) |
362,760 |
(359,404) |
Foreign exchange
(loss) / gain |
(52,284) |
(72,071) |
(120,031) |
18,350 |
Changes in
working capital |
|
|
|
|
|
(Increase)/decrease in
inventories |
(1,267,362) |
(781) |
(12,077) |
348,963 |
|
(Increase)decrease in
receivables, prepayments and accrued income |
(2,240,736) |
2,765,042 |
(1,482,794) |
883,597 |
|
Increase in payables, accruals and provisions |
404,803 |
247,961 |
925,657 |
934,445 |
Net cash inflow from operations |
9,552,322 |
9,118,325 |
7,651,881 |
6,086,478 |
|
|
|
|
|
Investing
activities |
|
|
|
|
Purchase of
property, plant and equipment and assets in construction |
(4,011,890) |
(980,086) |
(3,572,905) |
(238,179) |
Mine development
expenditure |
(2,936,169) |
(1,339,090) |
(1,346,542) |
(966,690) |
Geological
exploration expenditure |
(913,456) |
(357,424) |
(763,872) |
(357,424) |
Pre-operational
project costs |
(472,684) |
— |
(472,684) |
206,546 |
Proceeds from sale
of assets |
52,481 |
191,515 |
40,573 |
33,044 |
Interest
Received |
229,633 |
79,799 |
94,910 |
36,980 |
Net cash outflow on investing activities |
(8,052,085) |
(2,405,286) |
(6,020,520) |
(1,285,723) |
|
|
|
|
|
Financing
activities |
|
|
|
|
Receipt of
short-term loan |
5,000,000 |
5,000,000 |
— |
— |
Repayment of
short-term loan |
(5,000,000) |
(5,096,397) |
— |
(5,096,397) |
Payment of finance
lease liabilities |
(498,450) |
(610,982) |
(243,205) |
(307,841) |
Net cash (outflow)/inflow from financing
activities |
(498,450) |
(707,379) |
(243,205) |
(5,404,238) |
|
|
|
|
|
Net
increase/(decrease) in cash and cash equivalents |
1,001,787 |
6,005,660 |
1,388,156 |
(603,483) |
Cash and
cash equivalents at beginning of period |
11,552,031 |
7,196,313 |
11,056,317 |
13,920,999 |
Exchange difference on cash |
(512,801) |
83,475 |
(403,456) |
(32,068) |
Cash and cash equivalents at end of period |
12,041,017 |
13,285,448 |
12,041,017 |
13,285,448 |
Notes
-
Basis of preparation
1. Basis of preparationThese
interim condensed consolidated financial statements are for the
three and six month periods ended 30 June 2024. Comparative
information has been provided for the unaudited three and six month
periods ended 30 June 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
CovenantsThe 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
concernOn 30 June 2024 the Group held cash of US$12.0
million which represents an increase of US$0.49 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.
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.
3.
Finance
expense and income
|
6 monthsended30 June
202(unaudited) |
6 monthsended30 June 2023(unaudited) |
3 monthsended30 June
2024(unaudited) |
3 monthsended30 June 2023(unaudited) |
|
US$ |
US$ |
US$ |
US$ |
Loss on revaluations of
hedging derivatives |
— |
(88,755) |
— |
(88,755) |
Interest expense on short term
loan |
(242,077) |
(243,318) |
(100,430) |
(131,608) |
Interest expense on trade
finance |
(32,213) |
(41,891) |
(13,291) |
(25,056) |
Interest expense on finance
leases |
(36,013) |
(60,784) |
(21,977) |
(28,159) |
Total Financial
expense |
(310,303) |
(434,748) |
(135,698) |
(273,578) |
|
|
|
|
|
Interest Income |
229,633 |
79,799 |
94,910 |
36,980 |
Gain on revaluation of hedging
derivatives |
— |
570,863 |
— |
570,863 |
Realised gain on hedging
derivatives |
6,832 |
169,007 |
— |
169,007 |
Total Financial
income |
236,465 |
819,669 |
94,910 |
776,850 |
Net finance (expense)
/ income |
(73,838) |
384,921 |
(40,788) |
503,272 |
4.
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
six-month period to 30 June 2024 reflecting the stronger Brazilian
Real exchange rate at the end of the period and resulting in
deferred tax income of US$796,454 (six months to 30 June 2023 –
charge of US$607,223).
The Group has also incurred a tax charge in
Brazil for the six-month period of US$1,448,598 (six months to 30
June 2023 tax charge - US$738,787).
5. Earnings
per Share
|
6 months ended 30 June
2024(unaudited) |
6 months ended 30 June 2023(unaudited) |
3 months ended 30 June
2024(unaudited) |
3 months ended 30 June 2023(unaudited) |
Profit attributable to ordinary shareholders (US$) |
9,221,834 |
4,979,891 |
5,584,271 |
3,512,412 |
Weighted average ordinary shares in issue |
75,734,551 |
75,734,551 |
75,734,551 |
75,734,551 |
Basic profit per share (US cents) |
12.18c |
6.58c |
7.37c |
4.64c |
Diluted ordinary shares in issue (1) |
75,734,551 |
75,734,551 |
75,734,551 |
75,734,551 |
Diluted
profit per share (US cents) |
12.18c |
6.58c |
7.37c |
4.64c |
(1) On 30 June 2024 there were 2,814,541
conditional share awards in issue (30 June 2023 - 864,500). 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.
6. 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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