Source - RNS
RNS Number : 3201L
Metals Exploration PLC
30 September 2016
 

30 September 2016

METALS EXPLORATION PLC

INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2016

 

Metals Exploration plc (AIM: MTL) ("Metals Exploration" or "the Company"), the natural resources exploration and development company with assets in the Pacific Rim region, is pleased to announce its interim results for the six months ended 30 June 2016.

 

 

Chairman's Statement

It is my pleasure to report the interim financial position of the Runruno Gold project for the six month period ended 30 June 2016. The Runruno project achieved its first gold pour on 13 July 2016 as part of the test run including debugging ("Test Run") phase of the ore commissioning operations.  A number of gold pours have been completed since that date but no gold sales have been achieved due to limitations on the sale of commercial products during the Test Run phase.  Pursuant to the Company's Financial or Technical Assistance Agreement ("FTAA"), and so as to be able to commence the process of gold export and first sales, the Company declared the commencement of Commercial Production ("Declaration") on 9 September 2016.

The conditions attached to lifting the 2015 Residual Storage Impoundment ("RSI") partial suspension order are expected to be completed during October 2016. Mining operations and the gold processing and recovery circuits are in the ramp up phase which is expected to be completed by the end of November 2016. 

The Runruno project achieved the international environment accreditation ISO 14001:2015 in July, a requirement of all operating mines in the Philippines.

Debt restructuring discussions are ongoing with Hongkong and Shanghai Banking Corporation Limited and BNP Paribas (the "Lenders") with the objective of realigning the economic deliverables of the Project with the capital and interest repayments profile.

 

Commercial Operations

The FTAA defines several project stages (known as periods) which must be observed for a mining project to proceed into production being: (i) Exploration, (ii) Pre-feasibility study, (iii) Feasibility study, (iv) Development and Construction and (v) Operating. Each stage is prescriptive requiring compliance with various activities, declarations, verifications and undertakings which are obligatory. The Runruno Gold Project (the "Project") declared to the Mines and Geosciences Bureau ("MGB") on 9 September 2016 that it has commenced Commercial Operations, which has the effect of triggering the transition of the Project from the Development and Construction stage to the Operating stage. The Test Run phase of commissioning previously undertaken by the company fell within the Development and Construction stage of the FTAA.  The Project is now awaiting the approval from the MGB that it has commenced the Operating stage.

 

On approval by the MGB that the Project has entered the Operating stage the date of the Declaration, 9 September 2016 (the "Date"), is significant for the following reasons:

i.     Defined items of expenditure incurred by FCF Minerals Corporation ("FCF" the Company's 100% owned Philippine subsidiary) for the benefit of the FTAA Contract Area from the date of filing the FTAA (19 September 2009) up to the Date comprise the 'Pre-Operating Expenses'.

ii.    From the Date the five year Recovery Period commences wherein the 'Pre-Operating Expenses' are recovered prior to the payment of the Additional Government Share; which will align the Government and FCF sharing the Project's Net Mining Revenues equally, 50%.

 

The MGB is currently reviewing the Company's Declaration. It is expected that the first export will take place in early October 2016 with revenues received shortly after the export of gold doré.

 

Process Plant and ramp up phase

On 13 June 2016 the Project announced that it had achieved its first gold pour from its gravity circuit. Since that date there have been several other gold pours from recoveries out of the gravity circuit. In addition there have been a number of gold pours from recoveries out of the 'Carbon in Leach' ("CIL") circuit both before the BIOX® (Biological Oxidation) feed to the CIL was operational, and subsequently since the circuit was commissioned. The BIOX® circuit is now being ramped up and optimised which will take place over a two month period.

 

After commencing ore commissioning activities early in May 2016, during the last week of June 2016 and into early July 2016 milling activities were suspended due to the discovery of an issue with a feed end trunnion bearing of the mill requiring repair.  Unfortunately the mill was out of service for nearly four weeks before replacement parts were delivered to site and the repairs made. Prior to the trunnion bearing incident the mill had been commissioned and was ramping up towards its design parameters.

 

By the middle of July 2016 the mill was back in commission and the Test Running and ramp-up process resumed and continued through to 9 September 2016, when the Project made its Declaration. The mill is now achieving design parameters.  Weekly gold recoveries and pours have occurred since the mill was re-commissioned.

 

The BIOX® circuit is in ramp-up phase and the initial levels of biological oxidation activity are favourable but require further time to generate activation levels sufficient to provide design recoveries and throughput.

 



 

 

Residual Storage Impoundment

On 21 October 2015 the MGB suspended construction works on the Residual Storage Impoundment ("RSI") because of water damage caused by Typhoon Lando (Koppu). This included suspension to certain works in the Malilibeg Dump Site and the tailings pipeline bench areas. The Project was directed to undertake rehabilitation and enhancement works in these areas before the suspension order would be lifted. The rehabilitation works were completed in early 2016 and the enhancement works had advanced sufficiently for the MGB to lift the suspension order. However, as announced by the Company on 25 April 2016 there were ongoing performance monitoring and conditions attached to lifting the order.

 

The Project should be fully compliant with all of the additional conditions included in lifting the order during October 2016. The main work carried out to the RSI in compliance with the conditions of lifting is the construction of an 'over the wall' spill way, capable of managing a 'probable maximum flood' event. The spillway has been designed in such a way that as the routine ongoing RSI construction works advance the spillway will be raised through each stage of the build.

 

Mining

During 2016 most of the Project's mining activity has been focused on the enhancement works in the RSI while supplying sufficient ore for the Processing Plant operations. Once the Project has been validated by the MGB as having commenced the 'operating' stage the mine will ramp up fully to design production rates.

 

The completion of the RSI works associated with the MGB lifting order will once again open up the RSI area for the disposal of mine waste which will support the ramp up of mining operations to design rates.  

 

ISO 14001:2015 Environment

An MGB requirement of all operating mines in the Philippines is to obtain the international environmental standard of ISO 14001. FCF commenced working towards this accreditation in late 2015 and achieved the required accreditation during July 2016. The certificate authenticating its accreditation was awarded in August 2016 and marks an important milestone and achievement for the Project. FCF has consistently upheld the values of responsible mining and the Project has embraced ISO 14001 in its daily working culture and proud to have met the environmental management standards required.

 



 

Finances

Project capital expenditure:

At the end of August 2016 capital expenditure is only being incurred on the enhancement works in the RSI and a summary of the capital expenditure costs of the Project is as follows:

 


Budget

Expenditure to date

Forecast at completion


US $

US $

US $

Mining

$19,703,614

$18,371,768

$18,371,768

Process Plant

$80,801,822

$85,582,688

$85,583,017

Residual Storage Impoundment

$12,240,028

$28,045,955

$31,745,955

On-site infrastructure

$14,526,276

$13,744,584

$13,744,584

Off-site infrastructure

$5,069,940

$3,785,783

$3,785,783

Indirect costs

$10,413,578

$13,837,509

$14,040,852

Owners costs

$23,006,717

$32,222,549

$32,229,647

VAT contingency

$4,690,923

$7,278,869

$7,278,869

Project contingency

$12,311,102

$0

$0





Project related costs

$182,764,000

$202,869,705

$206,780,475

 

At 30 June 2016 there were outstanding capital commitments amounting to £157k (US $211k) but it is expected a further £2.75 million (US $3.7 million) will be required to complete the enhancement works in the RSI and finalise the capital spend on the project. This will bring the total capital spend on the construction of the Project to $206,780,475.

 

Facility Agreement capital and interest payments:

On 31 March 2016 the first capital payment amount of US $2.0 million was paid to the lenders together with an interest payment amounting to US $32,825. The next scheduled calculation date of 30 June 2016 and a capital payment of US $15.0 million was due to be paid but which has been waived until 31 October 2016. An interest payment of US $2,763,308 was however paid on the calculation date of 30 June 2016. One of the conditions applicable to waiving the US $15.0 million capital payment is that the interest associated with this principal is paid at the end of each month. Associated interest of $75,041 and US $85,878 was paid at the end of July 2016 and August 2016 respectively. The total principal and interest payments paid by FCF to the Lenders in the Facility Agreement amounts to US $10,190,066 and is represented as follows:

Calculation date

$83m facility, principal repaid

$75m facility, interest paid

$8m facility, interest paid

Rescheduling penalty

Total principal and interest


US $

US $

US $

US $

US $

31/12/2014


$842,987



$842,987

30/06/2015


$1,607,965



$1,607,965

23/10/2015




$400,000

$400,000

31/12/2015


$1,964,219

$247,399

$170,444

$2,382,062

31/03/2016

$2,000,000

$27,658


 $5,167

$2,032,825

30/06/2016


$2,081,027

$268,947

$413,334

$2,763,308

31/07/2016


$62,124


$12,917

$75,041

31/08/2016


$72,128


$13,750

$85,878








$2,000,000

$6,658,108

$516,346

$1,015,612

$10,190,066

On 19 October 2015 FCF entered into an Amendment deed to the Finance Facility under which the principal sums due were rescheduled. The benefit of obtaining the rescheduled dates was at a cost of US $1.25m of which US $400,000 was paid on signing the agreement on 23 October 2015. The remaining US $825,000 is recovered through a 1% interest penalty on interest payments due on the US $75 million senior facility and US $8 million cost overrun facility. To date US $615,612 has been recovered leaving a further US $209,388 still to recover from future interest payments.

Under the Amendment Deed to the Finance Facility there was a principal payment of US $15.0 million due on 30 June 2016 but due to the lack of cash flow received from zero sales of gold doré at that point in time it was agreed to waive the payment to a later date. FCF has an agreement with the Lenders that the US $15.0 million capital payment due 30 June 2016 is waived until 31 October 2016 or upon successful completion of the current debt rescheduling discussions, whichever arrives soonest.

 

Forward gold sales hedging contracts:

The two quarterly forward gold sales hedging commitments up to 30 June 2016, with Hongkong and Shanghai Banking Corporation Limited ("HSBC") and BNP Paribas ("BNPP") were closed out early during 2016. There were four contracts each for 3,750 ounces of gold and the strike price realised for each contract resulted in all four contracts being 'in the money'. The contracts settled at their contracted settlement dates to provide the following income stream to the Runruno Project:

Lender

Ounces of gold

Settlement Date

Forward Price by Contract

Forward Strike Price achieved

In the Money Amount




US $

US $

US $

HSBC

3,750

04/04/2016

$1,293.45

$1,270.51

$86,000.00

BNPP

3,750

04/04/2016

$1,287.49

$1,271.60

$59,587.50

HSBC

3,750

05/07/2016

$1,293.45

$1,231.99

$230,467.50

BNPP

3,750

05/07/2016

$1,287.49

$1,231.66

$209,373.75








15,000




$585,428.75

 

The two remaining quarterly forward gold sales hedging commitments in 2016 were also closed out early and the result was that the four contracts are also 'in the money' and will settle at their contracted settlement dates to provide the following income streams to the Runruno Project:

 

Lender

Ounces of gold

Settlement Date

Forward Price by Contract

Forward Strike Price achieved

In the Money Amount




US $

US $

US $

HSBC

3,750

04/10/2016

$1,281.38

$1,234.15

$177,093.75

BNPP

3,750

04/10/2016

$1,287.49

$1,233.67

$201,810.00

HSBC

3,750

04/01/2017

$1,281.38

$1,236.40

$168,656.25

BNPP

3,750

04/01/2017

$1,287.49

$1,235.77

$193,935.00








15,000




$741,495.00

 

A total of twelve forward gold sales contracts have been closed out for a total of 45,000 ounces of gold and this leaves a balance of twelve forward gold sales contracts (six with HSBC and six with BNPP) still to settle, as follows:

 

Fixing date

Settlement Date

Ounces of gold

Forward Price by Contract - HSBC

Forward Price by Contract - BNPP




US $

US $

31/03/2017

04/04/2017

7,500

$1,281.38

$1,287.49

30/06/2017

05/07/2017

7,500

$1,281.38

$1,287.49

29/09/2017

03/10/2017

7,500

$1,286.88

$1,287.49

29/12/2017

03/01/2018

7,500

$1,286.88

$1,287.49

30/03/2018

04/04/2018

7,500

$1,286.88

$1,287.49

29/06/2018

03/07/2018

7,500

$1,286.88

$1,287.49








45,000



Private share placings:

The Company had three occasions during 2016 to approach its major shareholders to offer private share placements at various intervals, to raise working capital for short term liquidity gaps. The shortfall in cash causing the liquidity gaps had arisen because of delays in realising sustainable cash flow from sales of gold doré. The first of these occasions was in March 2016 where a total of £4.3 million (US $6.2 million) was successfully raised via the issue of 148,300,536 new ordinary shares of 1 pence each at a placing price of 2.9 pence per share. Four of the Company's major shareholders took part in the private placing as follows:

 

 

PRIVATE SHARE PLACEMENT MARCH 2016

SHAREHOLDER

CURRENT SHARES

%

NEW SHARES

NEW REGISTER

%

GBP

MTL (Luxembourg) Sarl

740,905,659

46.80%

85,431,490

826,337,149

47.73%

£2,477,513

Runruno Holdings Ltd

300,407,305

18.98%

34,639,017

335,046,322

19.35%

£1,004,531

Baker Steel CM LLP¹

141,922,845

8.97%

16,658,476

158,581,321

9.16%

£483,096

Investec Wealth

105,297,639

6.65%

11,571,553

116,869,192

6.75%

£335,575

Others

294,471,897

18.60%

0

294,471,897

17.01%

£0








Total

1,583,005,345


148,300,536

1,731,305,881


£4,300,715

 

The second occasion occurred in July 2016 where a total of £3.8 million (US $5.0 million) was successfully raised via the issue of 76,128,414 new ordinary shares of 1 pence each at a placing price of 5.0 pence per share. Four of the Company's major shareholders took part in the private placing as follows:

 

 

 

 

 

PRIVATE SHARE PLACEMENT - JULY 2016

SHAREHOLDER

CURRENT SHARES

%

NEW SHARES

NEW REGISTER

%

GBP

MTL (Luxembourg) Sarl

826,337,149

47.73%

41,796,379

868,133,528

48.03%

£2,089,819

Runruno Holdings Ltd

335,046,322

19.35%

16,946,743

351,993,065

19.47%

£847,337

Ruffer LLP

200,455,373

11.58%

10,139,093

210,594,466

11.65%

£506,955

Baker Steel CM LLP¹

143,261,291

8.27%

7,246,199

150,507,490

8.33%

£362,310

Others

226,205,746

13.07%


226,205,746

12.52%

£0








Total

1,731,305,881


76,128,414

1,807,434,295

100.00%

£3,806,421

 

The third occasion occurred during September 2016 where a total of £4.85 million (US $6.4 million) was successfully raised via the issue of 97,002,174 new ordinary shares of 1 pence each at a placing price of 5.0 pence per share. Six of the Company's shareholders took part in the private placing as follows:

 

PRIVATE SHARE PLACEMENT - SEPTEMBER 2016

SHAREHOLDER

CURRENT SHARES

%

NEW SHARES

NEW REGISTER

%

GBP

MTL (Luxembourg) Sarl

868,133,528

48.03%

56,552,267

882,889,416

48.29%

£2,827,613

Runruno Holdings Ltd

351,993,065

19.47%

22,931,314

357,977,636

19.58%

£1,146,566

Baker Steel CM LLP¹

149,907,490

8.29%

6,268,119

206,723,492

11.31%

£313,406

Investec Wealth

119,033,014

6.59%

7,000,474

150,261,765

8.22%

£350,024

Lynchwood Nominees

2,633,783

0.15%

3,750,000

3,750,000

0.21%

£187,500

HSBC Marking Name Nominees

5,000,756

0.28%

500,000

500,000

0.03%

£25,000

Others

310,732,659

17.19%


226,205,746

12.37%

£0








Total

1,807,434,295


97,002,174

1,828,308,055


£4,850,109

 

Notes to share placing tables:

¹ Baker Steel CM LLP - Baker Steel Capital Managers LLP (acting on behalf of various Funds for which it acts as full discretionary Investment Manager).

 

 

Cash held by the Group after the September 2016 private share placing is £5.3 million (US$6.9 million).  In addition the Runruno project is holding about US $4 million of physical gold.

 

 

 

 

 

 

Ian Holzberger

Executive Chairman

 

 

 

 


CONDENSED CONSOLIDATED STATEMENT OF TOTAL COMPREHENSIVE INCOME for the six months ended 30 June 2016

 



6 month period


6 month period


Year



ended


ended


ended



30 June


30 June


31 December



2016


2015


2015



(unaudited)


(unaudited)


(audited)


Notes

£


£


£

Continuing Operations







Revenue


                         -  


 -


 -

Cost of sales


                         -  


 -


 -








Gross loss


                         -  


                         -  


                         -  

Administrative expenses


(3,781,295)


(3,002,872)


(5,206,287)








Operating loss


(3,781,295)


(3,002,872)


(5,206,287)








Finance income and similar items


207


281


1,028

Finance costs


(921,079)


(7,487)


(2,898,071)

Fair value (loss)/gain on forward sales contracts

3

(11,438,864)


1,769,956


8,511,399

Fair value (loss)/gain on interest rate swaps

3

(114,937)


(23,778)


(146,101)

Share of losses of associates


(12,440)


(15,252)


(26,325)

(Losses)/gains before tax


(16,268,408)


(1,279,152)


235,643








Taxation


3,816,934


(666,326)


(2,384,810)

Losses for the period


(12,451,474)


(1,945,478)


(2,149,167)








Other comprehensive income:














Items that may be re-classified subsequently to profit or loss:





Exchange differences on translating foreign operations


8,957,921


(2,695,317)


182,115








Total comprehensive loss for the period


(3,493,553)


(4,640,795)


(1,967,052)








Loss for the period attributable to:







Equity holders of the parent


(12,451,474)


(1,945,478)


(2,149,167)








Total comprehensive loss attributable to:







Equity holders of the parent


(3,493,553)


(4,640,795)


(1,967,052)








Loss per share:







Basic and diluted

4

(0.751)p


(0.141)p


(0.151)p

 

 



 

CONDENSED CONSOLIDATED INTERIM BALANCE SHEET

as at 30 June 2016

 



As at 30 June


As at 30 June


As at 31 December













Non-current assets




Property, plant and equipment




Goodwill




Other intangible assets




Derivative asset




Investment in associate companies




Trade and other receivables






182,041,770


145,570,020


166,119,960

Current assets







Derivative asset




Trade and other receivables




871,115

Cash and cash equivalents






2,928,536


13,055,615


15,850,578

Non-current liabilities




Loans




Derivative liability




(80,386)

Deferred tax liabilities




Provision for mine rehabilitation






(34,204,804)


(35,037,454)


(43,570,543)

Current liabilities







Derivative liability


(482,842)



Trade and other payables


(4,063,060)


(4,036,088)


(4,790,342)

Loans - current portion


(33,491,712)


(16,542,913)




(38,037,614)


(20,579,001)


(26,476,072)








Net assets


112,727,888


103,009,180


111,923,923















Equity







Share capital


17,313,059


13,749,721


15,830,054

Share premium account


131,566,251


124,591,071


128,751,738

Shares to be issued reserve


3,652,155


3,652,155


3,652,155

Acquisition of non-controlling interest reserve


(3,785,077)


(3,785,077)


(3,785,077)

Translation reserve


12,492,610


657,257


3,534,689

Profit and loss account


(48,511,110)


(35,855,947)


(36,059,636)








Equity attributable to equity holders of the parent


112,727,888


103,009,180


111,923,923

 

 



 

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY for the six months ended 30 June 2016

 


Share

Share premium

Shares to be

Translation

Acquisition of

Profit and loss

Total equity


capital

account

issued reserve

reserve

non-controlling

account







interest reserve




£

£

£

£

£

£

£

Balance at 1 January 2016

15,830,054

128,751,738

3,652,155

3,534,689

(3,785,077)

(36,059,636)

111,923,923









Exchange differences on translating foreign operations

                 

    -

                            -

                            -

 

8,957,921

                            -

                            -

 

8,957,921

 

Loss for the period

                 

    -

                            -

                            -

                            -

                            -

 

(12,451,474)

 

(12,451,474)

 

Total comprehensive income for the period

               

      -

                            -

                            -

 

8,957,921

                            -

 

(12,451,474)

 

(3,493,553)









Issue of equity share capital

 

1,483,005

 

2,817,710

                            -

                            -

                            -

                            -

 

4,300,715

 

 

Share issue expenses

       

            

 -

 

 

(3,197)

                           

 

-

                           

 

-

                           

 

-

                           

 

-

 

 

(3,197)









Balance at 30 June 2016 (unaudited)

17,313,059

131,566,251

3,652,155

12,492,610

(3,785,077)

(48,511,110)

112,727,888

 

 

Equity is the aggregate of the following:

·      Share capital; being the nominal value of shares issued.

·      Share premium account; being the excess received over the nominal value of shares issued less direct issue costs.

·      Shares to be issued reserve; being the credit side of the entry relating to the expense recognised in the income statement for share based remuneration.

·      Translation reserve; being the foreign exchange differences on the translation of foreign subsidiaries.

·      Acquisition of non-controlling interests reserve; being an acquisition of 15% of FCF Minerals Corporation's shares after previous acquisitions which had provided the Group with control of the board of the subsidiary company.

·      Profit and loss account; being the cumulative loss attributable to equity shareholders.



 

 

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY for the six months ended 30 June 2015

 


Share capital

Share premium account

Shares to be issued reserve

Translation reserve

Acquisition of non-controlling interest reserve

Profit and loss account

Total equity


£

£

£

£

£

£

£

Balance as at 1 January 2015

13,749,721

124,591,071

3,652,155

3,352,574

(3,785,077)

(33,910,469)

107,649,975

 

 

-

 

 

-

 

 

-

 

 

(2,695,317)

 

 

-

 

 

-

 

 

(2,695,317)

 

-

 

-

 

-

 

-

 

-

 

(1,945,478)

 

(1,945,478)


----

----

----

----

----

----

----

 

-

 

-

 

-

 

(2,695,317)

 

-

 

(1,945,478)

 

(4,640,795)


----

----

----

----

----

----

----

Balance as at 30 June 2015 (unaudited)

13,749,721

124,591,071

3,652,155

657,257

(3,785,077)

(35,855,947)

103,009,180


----

----

----

----

----

----

----

 

 

Equity is the aggregate of the following:

·      Share capital; being the nominal value of shares issued.

·      Share premium account; being the excess received over the nominal value of shares issued less direct issue costs.

·      Shares to be issued reserve; being the credit side of the entry relating to the expense recognised in the income statement for share based remuneration.

·      Translation reserve; being the foreign exchange differences on the translation of foreign subsidiaries.

·      Acquisition of non-controlling interests reserve; being an acquisition of 15% of FCF Minerals Corporation's shares after previous acquisitions which had provided the Group with control of the board of the subsidiary company.

·      Profit and loss account; being the cumulative loss attributable to equity shareholders.

 



 

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY for the year ended 31 DECEMBER 2015

 


Share capital

Share premium account

Shares to be issued reserve

Translation reserve

Acquisition of non-controlling interest reserve

Profit and loss account

Total equity


£

£

£

£

£

£

£

Balance at 1 January 2015

13,749,721

124,591,071

3,652,155

3,352,574

(3,785,077)

(33,910,469)

107,649,975









Exchange differences on translating foreign operations

                      -

                            -

                            -

 

182,115

                            -

                            -

 

182,115









Loss for the year

                      -

                            -

                            -

                            -

                            -

 

(2,149,167)

 

(2,149,167)









Total comprehensive income for the year

                      -

                            -

                            -

 

182,115

                            -

 

(2,149,167)

 

(1,967,052)









Issue of equity share capital

 

2,080,333

 

4,160,667

 

-

 

-

 

-

 

-

 

6,241,000









Balance at 31 December 2015

15,830,054

128,751,738

3,652,155

3,534,689

(3,785,077)

(36,059,636)

111,923,923

(audited)








 

 

Equity is the aggregate of the following:

·      Share capital; being the nominal value of shares issued.

·      Share premium account; being the excess received over the nominal value of shares issued less direct issue costs.

·      Shares to be issued reserve; being the credit side of the entry relating to the expense recognised in the income statement for share based remuneration.

·      Translation reserve; being the foreign exchange differences on the translation of foreign subsidiaries.

·      Acquisition of non-controlling interest reserve; being an acquisition of 15% of FCF Minerals Corporation's shares after previous acquisitions which had provided the Group with control of the board of the subsidiary company.

·      Profit and loss account; being the cumulative loss attributable to equity shareholders.



 

CONDENSED CONSOLIDATED INTERIM CASH FLOW STATEMENT for the period ended 30 June 2016

 

 













31 December 2015









(Loss)/gain before taxation


(16,268,408)


(1,279,152)


235,643

Fair value loss/ (gain) on forward sales contracts


11,438,864


(1,769,956)


(8,511,399)

Fair value loss/ (gain) on interest rate swaps


114,937


23,778


146,101

Impairment



293,705


Depreciation


1,057,981


1,091,621


1,726,688

Amortisation


74,405


37,579


70,834

Share of losses of associates


12,440


15,252


26,325

Net finance costs


920,809


7,206


2,897,043

(Increase)/decrease in receivables


(48,415)


55,979


(40,572)

Increase/(decrease) in payables


(1,278,105)


(262,422)


(294,824)

Cash used in operating activities


(3,975,492)


(1,786,410)


(3,744,161)








Interest received



281


1,028

Interest paid


(444,663)


(7,487)


(274,977)

Net cash used in operating activities


(4,419,948)


(1,793,616)


(4,018,110)








Investing activities







Purchase of property, plant and equipment


(7,973,242)


(19,974,764)


(34,090,272)

Purchase of intangible assets


(145,278)


(20,092)


(51,040)

Net cash used in investing activities


(8,118,520)


(19,994,856)


(34,141,312)








Financing activities







Repayment of borrowings


(1,488,521)


                         -  


                         -  

Proceeds from borrowings


                         -  


20,012,502


29,084,416

Net proceeds from issue of share capital


4,297,518


                         -  


6,241,000

Proceeds from settlement of gold forward contracts


1,041,465


                         -  


1,277,813

Net cash arising from financing activities


3,850,462


20,012,502


36,603,229








Net increase/(decrease) in cash and cash equivalents


(8,688,006)


(1,775,970)


(1,556,193)








Cash and cash equivalents at beginning of year




Foreign exchange difference


(696,194)










Cash and cash equivalents at end of year


1,585,249


10,352,286


10,969,449

 

 



 

Notes to the condensed consolidated interim financial statements

 

 

 

 

1.         General information

Metals Exploration plc is the parent company of the Group. Its shares are listed on the AIM market of the London Stock Exchange. The registered address of Metals Exploration plc is 200 Strand, London, WC2R 1DJ.

These condensed consolidated interim financial statements were approved by the Board of Directors on 30 September, 2016.

The results for the year ended 31 December 2015 have been audited whilst the results for the six months ended 30 June 2015 and 30 June 2016 are unaudited.

The financial information set out in this interim report does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006.  The Group's statutory accounts for the year ended 31 December 2015 which were prepared under International Financial Reporting Standards ("IFRS") as adopted for use in the European Union, were filed with the Registrar of Companies.  The auditors reported on these accounts, their report was unqualified and did not contain a statement under either Section 498 (2) or Section 498 (3) of the Companies Act 2006. The auditors drew attention to the Going Concern principle by way of emphasis.

2.         Basis of preparation

These condensed consolidated interim financial statements are for the six month period ended 30 June 2016.  They have been prepared in accordance with IFRS as adopted for use in the European Union with the exception of IAS 34: Interim Financial Reporting. IFRS is subject to amendment and interpretation by the International Accounting Standards Board ("IASB") and the IFRS Interpretations Committee and there is an ongoing process of review and endorsement by the European Commission. The financial information has been prepared on the basis of IFRS that the Board of Directors expect to be applicable as at 31 December 2016.

These condensed consolidated interim financial statements have been prepared under the historical cost convention, except for the revaluation of certain financial instruments.

3.         Hedging

Under the terms of the debt financing facility FCF Minerals Corporation, a wholly owned subsidiary of the Company, entered into two hedging arrangements with each of the facility banks: an interest rate hedge for approximately 40% of the interest exposure; and a gold forward sales programme representing a total of 90,000 ounces of gold. 45,000 ounces of forward sales contracts remain open. The movement in fair value of these derivative financial instruments is charged to the condensed consolidated statement of total comprehensive income and derivative financial assets and liabilities recognised on the condensed consolidated balance sheet. The Group has elected not to apply hedge accounting.



Notes to the condensed consolidated interim financial statements (continued)

 

4.         Loss per share

The loss per share was calculated on the basis of net loss attributable to equity shareholders divided by the weighted average number of ordinary shares.


6 month period ended 30 June 2016

6 month period ended 30 June 2015

Year ended 31 December 2015


(unaudited)

(unaudited)

(audited)


£

£

£

Loss




Net loss attributable to equity shareholders for the purpose of basic and diluted loss per share

 

(12,451,474)

 

(1,945,478)

 

(2,149,167)


-----

-----

-----

Number of shares




Weighted average number of ordinary shares for the purpose of basic and diluted loss per share

 

1,657,155,614

 

1,374,972,025

 

1,420,447,578


-----

-----

-----





Basic and diluted loss per share

(0.751)p

(0.141)p

(0.151)p


-----

-----

-----

The basic and diluted loss per share is the same, as the exercise of staff share options and warrants would reduce the loss per share and therefore, are anti-dilutive.

 






5.         Capital Commitments

As at 30 June 2016 the Group had £156,868 of outstanding capital commitments (30 June 2015: £3,463,304).

 

6.         Subsequent Events

In the period following 30 June 2016 to the current date, the Company announced that is has successfully raised a total of £8,656,530 by way of two private share placements to its major shareholders. A private share placement in July 2016 raised £3,806,421 from a share placing of 76,128,414 new ordinary shares of 1 pence each at a placing price of 5.0 pence per share. During September 2016 a private share placement raised £4,850,109 from a share placing of 97,002,174 new ordinary shares of 1 pence each at a placing price of 5.0 pence per share.


This information is provided by RNS
The company news service from the London Stock Exchange
 
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