TIDMMTL
RNS Number : 3811O
Metals Exploration PLC
31 January 2023
METALS EXPLORATION PLC
QUARTERLY UPDATE TO 31 DECEMBER 2022
Metals Exploration plc (AIM: MTL) ("Metals Exploration", the
"Company" or the "Group"), a gold producer in the Philippines, is
pleased to announce its quarterly results for Q4 2022.
Finance and corporate
-- Record quarterly gold sold of 23,608 ounces at an average
realised gold price of US$1,742 per ounce (Q3 2022: 14,980 ounces
at an average US$1,714 per ounce).
-- Record quarterly gold revenue of US$41.1 million (Q3 2022: US$25.7 million).
-- Record quarterly positive free cash flow of US$18.0 million (Q3 2022: US$4.2 million).
-- Senior debt effectively fully repaid during Q4 2022 following
payments of US$4.7 million in the quarter (Q3 2022: US$3.5
million).
-- Mezzanine debt repayments during Q4 2022 of US$8.6 million (Q3 2022 - US$nil).
-- Net debt as at 31 December 2022 was US$81.1 million (30 September 2022: US$92.4 million).
Mining Operations
-- No lost time injuries occurred during the period - over 18.3
million hours worked without a reportable injury .
-- Mining production of ore and waste for Q4 2022 was above
forecast at 3.11Mt (Q3 2022: 3.64Mt), with a total of 623Kt of ore
mined in Q4 2022 (Q3 2022: 380kt).
Processing Operations
-- Quarter record gold production during Q4 2022 with 25,474
ounces recovered (Q3 2022: 15,715 ounces) from 565Kt at a head
grade of 1.59g/t (Q3 2022: 456Kt at a head grade of 1.26g/t).
-- Gold recovery for Q4 2022 was 83.8% (Q3 2022: 84.8%).
FY2022/FY2023 Production Guidance
-- FY2022 gold production of 72,537 ounces exceeded the FY2022
upper guidance forecast of 71,000 ounces at an AISC of $1,235 per
ounce which was below the FY2022 lower guidance forecast of $1,275
per ounce
-- FY2023 Gold production forecast: 68,000 - 72,000 ounces.
-- FY 2023 AISC forecast: US$1,250 - US$1,300 per ounce.
Darren Bowden, CEO of Metals Exploration, commented :
"Operationally, Q4 was an excellent quarter with record
performances across several key metrics. This was achieved as a
result of a stable power environment, a higher head grade and the
completed upgrades to the process plant, leading to a quarter
record of 25,474 ounces gold production.
Fully repaying our senior debt is also a highly significant
milestone. The continuing strengthening of the Company's balance
sheet will enable it to invest further in its exploration plans and
to look at appropriate acquisition opportunities; delivering its
stated strategy and value to all its shareholders.
The Company was also delighted with the recognition that it
received from the Philippines' government. The Company has health
and safety and the environment at the forefront of everything that
it does and these awards, of which the Presidential award is the
highest government mining award attainable in the Philippines, are
a testament to the team and their high standards and dedication in
these areas. I would like to thank them all for their continued
efforts.
Our performance in Q4 has provided an excellent end to the year
as well as a very solid platform from which to build on in the
coming year and I look forward to updating on our progress in the
year ahead."
Production and Finance Summary
Runruno Project
Report Quarter Quarter FY 2022 FY 2021
---------- ---------- ----------- -----------
FY 2022 Actual Actual Actual Actual
---------- ---------- ----------- -----------
PHYSICALS Units Q4 2022 Q4 2021 12 Months 12 Months
------------- ---------- -----------
Mining
------------- ---------- -----------
Ore Mined Tonnes 623,245 636,916 2,292,439 1,896,808
-------------- ---------- -----------
Waste Mined Tonnes 2,484,760 2,243,456 11,422,847 8,806,216
-------------- ---------- -----------
Total Mined Tonnes 3,108,004 2,880,372 13,715,286 10,771,074
-------------- ---------- -----------
Au Grade Mined g/tonne 1.65 1.19 1.31 1.21
-------------- ---------- -----------
Strip Ratio 3.95 3.42 4.89 4.43
---------- -----------
Processing
------------- ---------- -----------
Ore Milled Tonnes 594,866 537,208 2,068,031 2,136,875
-------------- ---------- -----------
Au Grade g/tonne 1.59 1.15 1.27 1.26
-------------- ---------- -----------
S(2) Grade % 1.68 0.91 1.36 0.97
-------------- ---------- -----------
Au Milled (contained) Ounces 30,394 19,923 84,677 86,611
-------------- ---------- -----------
Recovery % 83.8 89.0 85.7 83.7
-------------- ---------- -----------
Au Recovered/Poured Ounces 25,474 18,435 72,537 73,206
-------------- ---------- -----------
Sales
------------- ---------- -----------
Au Sold Ounces 23,608 18,505 69,249 72,447
-------------- ---------- -----------
Au Price US$/oz 1,742 1,794 1,797 1,792
-------------- ---------- -----------
FINANCIALS (Unaudited)
------------------------- ------------- ---------- -----------
Revenue
------------- ---------- -----------
Gold Sales (US$000's) 41,113 33,202 124,411 129,849
-------------- ---------- -----------
Operating Costs
- Summary
------------- ---------- -----------
Mining (US$000's) 5,972 6,254 25,186 24,434
-------------- ---------- -----------
Processing (US$000's) 9,491 8,295 31,462 31,197
-------------- ---------- -----------
G&A (US$000's) 2,486 2,861 10,359 11,027
-------------- ----------
Total Operating
Costs (US$000's) 17,948 17,409 67,007 66,658
-------------- ----------
Excise Duty (US$000's) 1,661 1,350 5,023 5,255
-------------- ---------- -----------
UK/Philippine G&A (US$000's) 1,824 2,913 8,291 7,537
-------------- ---------- -----------
Total Direct Production
Costs (US$000's) 21,433 21,672 80,321 79,450
-------------- ---------- -----------
Net Cash Income (US$000's) 19,680 11,529 44,090 50,400
-------------- ---------- -----------
Total Capital Costs (US$000's) 1,669 1,466 8,341 12,180
-------------- ---------- -----------
Total non-cash
costs (US$000's) 7,620 4,166 19,332 18,629
-------------- ---------- -----------
Free Cashflow ( US$000's) 18,011 10,063 35,748 38,219
-------------- ---------- -----------
Cash Cost / oz
Sold - C1 US$/oz 829 887 922 937
-------------- ---------- -----------
Cash Cost / oz
Sold - AISC US$/oz 1,047 1,197 1,235 1,281
-------------- ---------- -----------
Note: AISC includes all UK Corporate costs.
Review of Operations
Gold sales for Q4 2022 were a quarter record of US$41.1 million
(Q3 2022: US$25.7 million), at an average realised gold price of
US$1,742 per ounce (Q3 2022: average gold price of US$1,714 per
ounce); producing a quarter record positive free cash flow of
US$18.0 million (Q3 2022: US$4.2 million).
Finance
During Q4 2022 the Group's senior debt was effectively fully
repaid. A nominal amount of approximately US$1,000 remains unpaid
to ensure various loan securities remain in place while the Company
completes the elevation of the status of the mezzanine loans to
that of secured debt. The mechanics required to effect the
elevation of the mezzanine debt from unsecured to secured debt, as
was agreed in the October 2020 debt restructure, is subject to
ongoing discussions with the RHL Group and MTL Luxemburg, and the
completion of complex and multi-country documentation; and the
registration of new security arrangements in numerous
jurisdictions.
A further update of this matter will be provided in due
course.
Total senior debt repayments of US$4.7 million (Q3 2022: US$3.5
million) were made during Q4 2022. In addition, US$8.6 million in
mezzanine debt payments were made during Q4 2022 (Q3 2022:
US$nil).
The net Group debt position as at 31 December 2022 was US$81.1
million (Q3 2022: US$92.4 million). Cash holdings at 31 December
2022 were US$0.9 million (30 September 2022: US$0.6 million).
Mining Operations
Mining production of ore and waste for Q4 2022 was above
forecast at 3.11Mt (Q3 2022: 3.64Mt), with a total of 623Kt of ore
mined in Q4 2022 (Q3 2022: 380kt). In Stage 3 higher grade material
was accessed during the quarter allowing the Group to mill a higher
average grade for the quarter.
Negotiations for access to Stages 4 and 5 progressed during Q4
2022. Sufficient access has been achieved such that the Company
expects its exploration programme in Stages 4 and 5 to commence in
Q1 2023 after the end of the wet season.
Process Plant
Stabile power delivery during Q4 2022 enabled a higher
throughput to be maintained for the quarter. This together with the
completed upgrades to return water and cooling systems and the
installation of new tailings line pumps has enabled the Company to
produce a quarter record 25,474 ounces for the quarter (Q3 2022:
15,715 ounces). This result represents an increase of over 5,500
ounces of gold produced compared to the Company's previous best
quarter.
Throughput for Q4 2022 was 595kt (Q3 2022: 456kt). Gold
production for Q4 2022 was at a recovery rate of 83.8% (Q3 2022:
84.8%).
Government Industry Awards
During Q4 2022, the Group was awarded the following Philippine
government mining industry awards:
-- Presidential Mineral Industry Environmental Award (PMIEA) in the Surface Mining Category
-- Runner-up, Safest Surface Mining Operation Award
-- 3rd Runner-up, Best Mining Forest Contest - Metallic Category
These awards are given to mining companies in recognition of
outstanding levels of dedication, initiatives and innovations in
the pursuit of excellence in environmental protection, health &
safety management and social/community development. Winning the
Presidential award is the highest government mining award
attainable in the Philippines.
Residual Storage Impoundment ("RSI")
Work on the final RSI dam-wall raise was unable to be completed
in Q4 2022 due to adverse weather conditions. This final dam wall
raise is expected to be completed, subject to weather conditions,
in Q1 2023. During Q4 2022 the mine experienced a number of severe
rain events. Notwithstanding this, the d am water freeboard
remained well above design minimum levels. Detailed planning of the
RSI final in-rock spillway should be completed during Q1 2023.
Occupational Health & Safety
Runruno continues to record an exceptional safety record with
over 18.3 million hours worked without a lost-time reportable
injury as at the date of this announcement. Runruno's operations
also continue to be largely unaffected by COVID-19.
Environment and Compliance
Compliance matters continue to be successfully monitored, and
the mine remains compliant, with no outstanding material
issues.
Community & Government Relations
In conjunction with relevant government agencies, the Company
continues in its efforts to complete the removal of the illegal
miners, including their infrastructure and dwellings, from those
areas scheduled to be explored and mined as part of mine plan
Stages 4 and 5.
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014, which forms part of United
Kingdom domestic law by virtue of the European Union (Withdrawal)
Act 2018 (as amended). Upon the publication of this announcement,
this inside information is now considered to be in the public
domain.
- END -
-
For further information please visit or contact:
Metals Exploration PLC
Via Tavistock Communications
Limited +44 (0) 207 920 3150
-------------------------
Nominated & Financial STRAND HANSON LIMITED
Adviser:
-------------------------
James Spinney, James
Dance, Rob Patrick +44 (0) 207 409 3494
-------------------------
Financial Adviser & HANNAM & PARTNERS
Broker:
-------------------------
Matt Hasson, Franck Nganou +44 (0) 207 907 8500
-------------------------
Public Relations: TAVISTOCK COMMUNICATIONS
LIMITED
-------------------------
Jos Simson, Nick Elwes +44 (0) 207 920 3150
-------------------------
Web: www.metalsexploration.com
Twitter: @MTLexploration
LinkedIn: Metals Exploration
Competent Person's Statement
Mr Darren Bowden, a director of the Company, a Member of the
Australasian Institute of Mining and Metallurgy and who has been
involved in the mining industry for more than 25 years, has
compiled, read and approved the technical disclosure in this
regulatory announcement in accordance with the AIM Rules - Note for
Mining and Oil & Gas Companies.
Forward Looking Statements
Certain statements relating to the estimated or expected future
production, operating results, cash flows and costs and financial
condition of Metals Explorations, planned work at the Company's
projects and the expected results of such work contained herein are
forward-looking statements which are based on current expectations,
estimates and projections about the potential returns of the Group,
industry and markets in which the Group operates in, the Directors'
beliefs and assumptions made by the Directors . Forward-looking
statements are statements that are not historical facts and are
generally, but not always, identified by words such as the
following: "expects", "plans", "anticipates", "forecasts",
"believes", "intends", "estimates", "projects", "assumes",
"potential" or variations of such words and similar expressions.
Forward-looking statements also include reference to events or
conditions that will, would, may, could or should occur.
Information concerning exploration results and mineral reserve and
resource estimates may also be deemed to be forward-looking
statements, as it constitutes a prediction of what might be found
to be present when and if a project is actually developed.
These statements are not guarantees of future performance or the
ability to identify and consummate investments and involve certain
risks, uncertainties and assumptions that are difficult to predict,
qualify or quantify. Among the factors that could cause actual
results or projections to differ materially include, without
limitation: uncertainties related to raising sufficient financing
to fund the planned work in a timely manner and on acceptable
terms; changes in planned work resulting from logistical, technical
or other factors; the possibility that results of work will not
fulfil projections/expectations and realize the perceived potential
of the Company's projects; uncertainties involved in the
interpretation of drilling results and other tests and the
estimation of gold reserves and resources; risk of accidents,
equipment breakdowns and labour disputes or other unanticipated
difficulties or interruptions; the possibility of environmental
issues at the Company's projects; the possibility of cost overruns
or unanticipated expenses in work programs; the need to obtain
permits and comply with environmental laws and regulations and
other government requirements; fluctuations in the price of gold
and other risks and uncertainties.
The Company expressly disclaims any obligation or undertaking to
disseminate any updates or revisions to any forward looking
statements contained herein to reflect any change in the Group's
expectations with regard thereto or any change in events,
conditions or circumstances on which any such statements are based
unless required to do so by applicable law or the AIM Rules.
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END
MSCFIFFRLFILVIV
(END) Dow Jones Newswires
January 31, 2023 02:00 ET (07:00 GMT)
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