Mineral & Financial Investments Limited

Interim Results (unaudited) for the Six Months Ended 31 December 2020

HIGHLIGHTS:

·    Unaudited fully diluted net earnings for the first 6 months of the fiscal 2021 period were 0.6p per share, compared to 0.7p for the same period last year.

·    NAV per share at 31 Dec 2020 up 6.0% vs. same period last year, to 16.1p

·    The 5 Year Compound Annual Growth Rate (CAGR) of the NAV per share is 26.7%

·    M&FI has outperformed the FTSE 350 Mining Index and GSCI during the past 5 years

·    Strong Improvement in Sterling neutralized £435K of NAV gains in the period

·     Company is debt free, with a good cash balance and a strong Working Capital position

GEORGE TOWN, CAYMAN ISLANDS, March 31, 2021 - Mineral and Financial Investments Limited (LSE-AIM: MAFL) ("M&FI" or the "Company") is very pleased to announce its unaudited interim results for the six months ended 31 December 2020.

CHIEF EXECUTIVE OFFICER'S STATEMENT:

The Company generated a profit after-tax of £207K and a fully diluted EPS gain of 0.6p per share compared to a profit after-tax of £247K and a fully diluted EPS gain of 0.7p per share for the same period last year.  The NAV per share increased 6.0% from 31 December 2019 to 16.1p or £5,681K, a new high for M&FI. 

The Company has increased its cash position to £578,000. The NAV growth was negatively affected by a corrective phase in precious metal prices and continued strength of the GBP versus the USD in the period. Although we reduced our precious metals weightings in the Tactical Portfolio, we did retain certain holdings which corrected along with the price of gold and silver.  Additionally, the British Pound was up 10.1% versus the US Dollar in the past six months, since our most recent year end (30 June 2020). Virtually all of our investments are directly, or indirectly, valued in US dollars and we report in British Pounds, thus the strong performance of the British Pound has caused significant headwinds to our NAV performance. Had the GBP remained unchanged from 30 September 30, 2020 our NAV would have been £250K higher, and had the June 30, 2020 Currency levels been maintained our NAV would be £435K higher.

One year ago, we stated that we remained optimistic that zinc markets would recover from the anaemic price levels of US$1,800/t reached in March of 2020. They have since reached US$2,900/t in February 2021. Additionally, and importantly, spot Tolling Charges (TC) at zinc refineries are down from a high of $300/t in February 2020 to US$65/t[1] in February 2021eriod due to a reduction on zinc production from China resulting in refineries scrambling to meet their capacity. These are all positives for our investment in zinc, particularly Redcorp, Ascendant and our recent investment in Rathdowney Resources. Ascendant and Redcorp (M&FI own 75%) continue to make progress on the Lagoa Salgada project, and they are completing a drilling program which should lead to drill results being available in the next 6 to 8 weeks.

Your company's portfolio is overweight in precious metals. As mentioned above, we reduced our weighting in the sector, but did not eliminate entirely and thus our performance was negatively affected by the correction in the gold price from the highs of US$2,068/oz. We have begun adding back to our precious metal holdings after the price of gold pierced through the 1,700/oz level.    

The following is a summary of the NAV, updated to include the unaudited NAV calculation:

Tactical Portfolio:

The purpose of the Tactical Portfolio is to allow M&FI flexibility to take advantage of short-term opportunities across asset classes in high quality names, whilst remaining liquid enough to deploy working capital in attractive investment opportunities when available. We took a firmly positive view on gold in early 2018. Any changes in our tactical holdings in precious metals are trading decisions around our long-term bullish attitude towards precious metals - which remains unaltered.

Our largest tactical holding is Barrick Gold, which is amongst the largest gold producers in the world. The value of our holding was down 22.6% in GBP, but only down 12.5% in USD. We initiated the position subsequent to the announced merger/acquisition of Randgold Resources. The acquisition of Randgold necessitated its removal from the FTSE indices, we understand that many institutional investors framed by investment mandate restrictions were forced to divest of their positions which we believe resulted in abnormal selling pressure. We believe that Barrick continues to improve its operations under the strong leadership of its new CEO, formerly of Randgold will continue to drive operational and strategic efficiencies resulting improvement relative to its history and that of its peers.

Also, part of Tactical Portfolio is Ascendant Resources. We are pleased to see the shares doubling in value in the quarter after Ascendant completed a financing. Additionally, Ascendant announced an update to their resource which aided in the upward valuation of the company.  We made a small investment in a company called Rathdowney Resources Ltd. It is a Canadian exploration/development company with an inferred resource of 24.4Mt with a Zinc Equivalent grade of 7.02% (5.53% Zinc; 1.49% Lead) at a project in Poland called Olza.

We were, and continue to be, concerned that there is a disconnect between overall equity market performance and the economic performance. As a defensive move to protect we initiated a copper put position which was meant as a hedge against broad market corrections. We believe that the concept was sound, but the timing was poor. We have since flattened the position, but it negatively affected performance in the period.

The Tactical Portfolio, as of December 31, 2020, includes:

Strategic Portfolio:

After the period end, we were pleased to announce the resource update at Lagoa Salgada South which is operated by Ascendant Resources and our 75% owned investee Redcorp Empreedimentos Mineiros Lda. (Redcorp) (see announcement dated 3 March 2021). The new Mineral Resource Estimate was prepared in accordance with Canadian National Instrument 43-101 ("NI 43-101") by Micon International (Micon) and resulted in a significant upgrade and expansion of the resources at the South Zone at the Lagoa Salgada Volcanogenic Massive Sulphide ("VMS") Project. The South Zone is less than 700m from the North Zone. The Lagoa Salgada North Zone hosts a zinc rich Measured and Indicated resource of 10.334M tonnes (using 2.9 % cut-off grade) at an Avg ZnEq[2] grade of 9.06% and an Inferred resource of 2.502M tonnes (using a 2.8% cut-off grade) grading 5.93% ZnEq² (See RNS of January 14, 2020).

Golden Sun Exploration (Golden Sun) has succeeded in the re-instatement of its mining licences, which it voluntarily suspended 5 years ago, through application to the Costa Rican government. This licence re-instatement was a cornerstone of the business plan and will allow Golden Sun to expand its production from the self-funding "pilot plant' phase of production to a staged expansion and resumption of full mining and processing at the BellaVista Mine, located in West Central Costa Rica. Furthermore, we understand Golden Sun has built up a growing level of local and governmental support due to its operations and stakeholder engagement. This has resulted in Golden Sun being seen as an acceptable mine operator in environmentally sensitive Costa Rica. Due in large part to Golden Sun's status, exploration subsidiary Terra Sun, has secured the exploration rights from the government to a nearby project called Libano, which had been a Newmont Gold project. Additional exploration projects which have failed to meet work commitments expected by the Costa Rican Government are being reviewed by Golden Sun. Operationally, heap leach recoveries have been below target due to insufficient grind size and oxygenation, which management is addressing.

The Strategic Portfolio allows M&FI to assess the three key fundamentals to a successful investment in the sector: management, finance and geology.  We can change the first two of these and so we exercise in depth due diligence on geology.  As such we are constantly reviewing potential investments filtering through the many underfunded projects left struggling by 10yrs of underperformance.  The Board continues to like zinc and gold which is well represented in both portfolios and is reviewing investments in other commodities, notably copper, with the potential to outperform.

The Strategic Portfolio, as at December 31, 2020, includes:

The directors look forward to providing shareholders with more information on all the investments, in due course if they progress. Several of these opportunities are private.

On behalf of the Board

Jacques Vaillancourt

FOR MORE INFORMATION:

Jacques Vaillancourt, Mineral & Financial Investments Ltd.                        +44 777 957 7216

Katy Mitchell and Matthew Chan, WH Ireland Limited                  +44 207 220 1666

Jon Belliss, Novum Securities Limited                                          +44 207 399 9400

Dominic Baretto - Yellow Jersey PR Limited                                +44 203 004 9512

Statement of comprehensive Income

for the 6 months ended 31 December 2019

Statement of Financial Position

as at 31 December 2020

Statement of Changes in equity

for the 6 months ended 31 December 2020

Statement of Cash flows

for the 6 months ended 31 December 2020

Notes to the unaudited interim statement

for the 6 months ended 31 December 2020

1. General information

The Company is a limited company quoted on AIM, a market of the London Stock Exchange, and is registered in the Cayman Islands.

The address of its registered office is One Nexus Way, Camana Bay, Grand Cayman, KY1-9005, Cayman Islands.  The financial statements are presented in Pounds Sterling which is the Company's functional and presentational currency.

2. Basis of preparation

The interim financial statements of Mineral & Financial Investments Limited have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union (EU) and on the historical cost basis using the accounting policies which are consistent with those set out in the Company's Annual Report and Accounts for the year ended 30 June 2020.

This interim financial information for the 6 months to 31 December 2020 was approved by the board on 30 March 2021.

The unaudited interim financial information for the 6 months to 31 December 2020 does not constitute statutory accounts. The comparative figures for the year ended 30 June 2020 are extracted from the statutory financial statements which contain an unqualified audit report.

3. Earnings per share

4. The interim report is available to view and download from the Company's website: www.mineralandfinancial.com