TIDMMTL
RNS Number : 7627X
Metals Exploration PLC
28 April 2023
METALS EXPLORATION PLC
QUARTERLY UPDATE TO 31 MARCH 2023
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 Q1 2023.
Finance and corporate
-- Gold sold - 21,442 ounces at an average realised gold price
of US$1,887 per ounce (Q4 2022: 23,608 ounces at an average
US$1,742 per ounce).
-- Gold revenue of US$40.5 million (Q4 2022: US$41.1 million).
-- Positive free cash flow of US$17.8 million (Q4 2022: US$18.0 million).
-- Elevation of mezzanine debt to secured status ongoing and
there is uncertainty over the interest rate that will be applied to
the outstanding loan in the period prior to completion of the
elevation.
-- Mezzanine debt repayments of US$14.3 million (Q4 2022 - US$8.6 million).
-- Net debt as at 31 March 2023 was US$69.0 million (31 December 2022: US$81.1 million).
Mining Operations
-- No lost time injuries occurred during the period - over 19
million hours worked without a reportable injury .
-- Mining production of ore and waste was 2.74Mt (Q4 2022:
3.11Mt), with a total of 282Kt of ore mined in Q1 2023 (Q4 2022:
623Kt).
Processing Operations
-- Gold production of 21,299 ounces recovered (Q4 2022: 25,474
ounces) from 546Kt at a head grade of 1.30g/t (Q4 2022: 565Kt at a
head grade of 1.59g/t).
-- Gold recovery was a quarter record of 93.4% (Q4 2022: 83.8%).
Darren Bowden, CEO of Metals Exploration, commented :
"The first quarter of the year has continued to see a strong
performance at Runruno, although material movement for the quarter
was impacted by diverting of dump trucks to assist with the RSI
final in-rock spillway earthworks. We were also particularly
delighted with the throughput at our processing plant where we
achieved a record gold recovery rate of 93%; an incredible
achievement by the team.
"The Company is well set for the year ahead to deliver our
strategy of extending the life of mine at Runruno via near pit
exploration programmes, as well as looking at appropriate
acquisition opportunities."
Production and Finance Summary
Runruno Project
Report Quarter Quarter FY 2023 FY 2022
---------- ----------- ---------- -----------
FY 2023 Actual Actual Actual Actual
------------- ---------- ----------- ---------- -----------
PHYSICALS Units Q1 2023 Q1 2022 3 Months 3 Months
------------- ----------- -----------
Mining
------------- ----------- -----------
Ore Mined Tonnes 282,256 779,299 282,256 779,299
-------------- ----------- -----------
Waste Mined Tonnes 2,457,153 3,151,787 2,457,153 3,151,787
-------------- ----------- -----------
Total Mined Tonnes 2,739,409 3,963,735 2,739,409 3,963,735
-------------- ----------- -----------
Au Grade Mined g/tonne 1.53 1.05 1.53 1.05
-------------- ----------- -----------
Strip Ratio 8.17 3.96 8.17 3.96
----------- -----------
Processing
------------- ----------- -----------
Ore Milled Tonnes 546,083 507,044 546,083 507,044
-------------- ----------- -----------
Au Grade g/tonne 1.30 1.02 1.30 1.02
-------------- ----------- -----------
S(2) Grade % 1.28 0.86 1.28 0.86
-------------- ----------- -----------
Au Milled (contained) Ounces 22,806 16,655 22,806 16,655
-------------- ----------- -----------
Recovery % 93.4 89.0 93.4 89.0
-------------- ----------- -----------
Au Recovered/Poured Ounces 21,299 14,819 21,299 14,819
-------------- ----------- -----------
Sales
------------- ----------- -----------
Au Sold Ounces 21,442 15,685 21,442 15,685
-------------- ----------- -----------
Au Price US$/oz 1,887 1,898 1,887 1,898
-------------- ----------- -----------
FINANCIALS (Unaudited)
------------------------- ------------- ----------- -----------
Revenue
------------- ----------- -----------
Gold Sales (US$000's) 40,458 29,773 40,458 29,773
-------------- ----------- -----------
Operating Costs
- Summary
------------- ----------- -----------
Mining (US$000's) 5,244 6,335 5,244 6,335
-------------- ----------- -----------
Processing (US$000's) 9,232 7,370 9,232 7,370
-------------- ----------- -----------
G&A (US$000's) 2,952 2,700 2,952 2,700
-------------- -----------
Total Operating
Costs (US$000's) 17,428 16,405 17,428 16,405
-------------- -----------
Excise Duty (US$000's) 1,635 1,217 1,635 1,217
-------------- ----------- -----------
UK/Philippine G&A (US$000's) 1,680 1,682 1,680 1,682
-------------- ----------- -----------
Total Direct Production
Costs (US$000's) 20,743 19,304 20,743 19,304
-------------- ----------- -----------
Net Cash Income (US$000's) 19,715 10,469 19,715 10,469
-------------- ----------- -----------
Total Capital Costs (US$000's) 1,872 2,263 1,872 2,263
-------------- ----------- -----------
Total non-cash
costs (US$000's) 7,852 4,673 7,852 4,673
-------------- ----------- -----------
Free Cashflow ( US$000's) 17,843 8,206 17,843 8,206
-------------- ----------- -----------
Cash Cost / oz
Sold - C1 US$/oz 928 982 928 982
-------------- ----------- -----------
Cash Cost / oz
Sold - AISC US$/oz 1,170 1,311 1,170 1,311
-------------- ----------- -----------
Note: AISC includes all UK Corporate costs.
Review of Operations
Gold sales for Q1 2023 were US$40.5 million (Q4 2022: US$41.1
million), at an average realised gold price of US$1,887 per ounce
(Q4 2022: average gold price of US$1,742 per ounce); producing a
positive free cash flow of US$17.8 million (Q4 2022: US$18.0
million).
Finance
During Q4 2022, the Group's senior debt was effectively fully
repaid. A nominal amount of approximately US$1,200 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 the
completion of complex and multi-country documentation; and the
registration of new security arrangements in numerous
jurisdictions. The October 2020 debt restructuring agreements
envisage the interest rate applicable to the Mezzanine Debt being
reduced from 15% to 7% once the Senior Debt is repaid and the
elevation of the Mezzanine Debt to "new" Senior Debt is
complete.
The majority mezzanine lender, MTL Luxemburg, Nick Candy's
investment vehicle (holding 70.7% of the Mezzanine Debt), has
confirmed in writing that, subject to completion of the elevation
documents within a reasonable period (expected to be before the end
of Q3 2023), the interest rate on its portion of the Mezzanine Debt
will reduce to 7% per annum from 15% per annum as from 3 November
2022 (being the date that the Company could have fully repaid the
Senior Facility, but for the requirements of the elevation).
The minority 29.3% mezzanine lender, the RHL Group, has not
confirmed the same in writing; however, the Company is hopeful the
RHL Group will apply the 7% interest rate from 3 November 2022 and
that this will be formalised once the elevation documents are
completed within a reasonable period.
Total mezzanine debt payments of US$14.3 million were made
during Q1 2023 (Q4 2022: US$8.6 million).
The net debt position of the Group as at 31 March 2023 was
US$64.4 million (Q4 2022: US$81.1 million). Cash holdings at 31
March 2023 were US$4.6 million (31 December 2022: US$0.9
million).
Mining Operations
Mining production of ore and waste for Q1 2023 was below
forecast at 2.74 Mt (Q4 2022: 3.11Mt), with a total of 282Kt of ore
mined in Q1 2023 (Q4 2022: 623kt). Material movement for the
quarter was below forecast due to the diverting of dump trucks to
the assist with the RSI final spillway earthworks which commenced
in Q1 2023.
An exploration programme in Stages 4 and 5 commenced in Q1 2023,
with the objective of identifying new gold resources both in and
near-to the current pit-shell design. To date, this drilling has
not produced any material gold discoveries.
Process Plant
Stable operations were delivered during Q1 2023, with all
aspects of the process plant performing adequately. Gold produced
during Q1 2023 was 21,299 ounces for the quarter (Q4 2022: 25,474
ounces).
Throughput for Q1 2023 was 546Kt (Q4 2022: 595Kt). Gold
production for Q1 2023 was at a record recovery rate of 93.4% (Q4
2022: 83.8%).
Residual Storage Impoundment ("RSI")
Work on the final RSI dam-wall raise is expected to be
completed, subject to weather conditions, in Q2 2023.
Notwithstanding this, the d am water freeboard remained well above
design minimum levels. Initial earthworks on the construction of
the RSI final in-rock spillway commenced during Q1 2023.
Occupational Health & Safety
Runruno continues to record an exceptional safety record with
over 19 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
has largely completed its efforts to remove illegal miners,
including their infrastructure and dwellings, from 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
UPDNKOBBPBKDCQB
(END) Dow Jones Newswires
April 28, 2023 02:00 ET (06:00 GMT)
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