Source - LSE Regulatory
RNS Number : 3614Q
Goldplat plc
20 February 2023
 

Goldplat plc / Ticker: GDP / Index: AIM / Sector: Mining & Exploration

20 February 2023

Goldplat plc

('Goldplat', the 'Group' or 'the Company')

Audited Results for the year ended 30 June 2022

Goldplat plc, (AIM:GDP) the AIM listed Mining Services Group, with international gold recovery operations located in South Africa and Ghana, servicing the African and South American Mining Industry, is pleased to announce its audited results for the year ended 30 June 2022.

The Company's annual report and accounts are available on the Company's website at http://www.goldplat.com/downloads  and hard copies will be posted this week to shareholders that have elected to receive printed copies.

As announced on 3 January 2023, the Annual General Meeting of the Company was adjourned pending the completion of the audit of the annual report and accounts. The date of the adjourned meeting, which will consider the first resolution set out in the notice of meeting "To receive the report of the Directors of the Company and the audited financial statements of the Company for the year ended 30 June 2022", will be confirmed in due course.

Lifting of suspension of shares

Following the publication of the results for the year ended 30 June 2022, the Company has requested that the suspension of trading in its shares to be lifted with effect from 7.30 a.m. today, Monday 20 February 2023

For further information visit www.goldplat.com, follow on Twitter @GoldPlatPlc or contact:

 

 

The information contained within this announcement is deemed to constitute inside information as stipulated under the retained EU law version of the Market Abuse Regulation (EU) No. 596/2014 (the "UK MAR") which is part of UK law by virtue of the European Union (Withdrawal) Act 2018. The information is disclosed in accordance with the Company's obligations under Article 17 of the UK MAR. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

 

 

 

Chairman's Statement

In my first Chairman's statement I am pleased to report continued improvements in all areas of the business including increased profitability from operations, increased visibility of earnings and the commencement of returning value to our shareholders.

Our portfolio of core assets consists of two gold recovery operations, in South Africa and Ghana, with plans to extend this to Brazil. These operations recover gold and platinum group metals ('PGM') from by-products of current and historical mining processing, thereby providing mines with an environmentally-friendly and cost-efficient way of removing waste material.

Having strategically moved away from primary mining, we remain committed to our strategy of increasing long term visibility of earnings in the recovery businesses and returning value to our shareholders, whilst increasingly positioning ourselves as a service company and an ESG player in the mining space, forming a key element of primary producers' ESG initiatives. This focus is aligned with our growth strategy and will include broadening the commodity spaces in which we operate and add value.

Profit for the year increased to GBP3,963,000 (2021 profit GBP2,179,000) with net cash flows from operating activities of GBP2,997,000 (2021: GBP2,309,000) and net year end cash of GBP3,895,000 (2021: GBP 3,459,000). These excellent numbers are primarily the result of solid performance at both operations, increased supply of material and increasing profit margins.

During the period, the Company announced that all cash in excess of operating and development requirements would be returned to shareholders and that all royalties received from Kilimapesa would be distributed to shareholders. During March and April 2022, the Company announced a share buy‑back programme. This purchase of shares amounted to GBP400,000 and the resulting treasury shares were cancelled in May 2022. Post year end, the Company sold its remaining shares in Caracal Gold Plc, resulting in a further GBP 681,000 in cash being realised from the sale of Kilimapesa consideration shares. The partial restructuring of the Group was completed during the period with the Group's shareholding in Goldplat Recovery (Pty) Limited increased to 90.63%.

Your board of directors has seen several changes during the period. Martin Ooi, a shareholder and long-time supporter of Goldplat, was appointed as a non-executive director in October 2021, and Nigel Wyatt resigned as a non-executive director with effect from 31 December 2021. In May 2022 Matthew Robinson announced his intention to retire as non-executive Chairman, with his retirement coming into effect on 26 September 2022. I would like to thank Matthew for his steadfast guidance since his appointment in 2016. Matthew's leadership through this period of strategic change for Goldplat is greatly appreciated and I would like to wish him well in his future endeavours. I joined as non-executive director in September 2022 and I am delighted to take over as non-executive chairman at a time where the strategic changes are already resulting in sustainable improvements with exciting potential for continued further growth. With these changes I believe that your Board is well positioned to continue to grow the company's existing and new businesses.

Whilst the threat to the Group posed by the Covid pandemic has diminished significantly during the year, we remain cautious and continue a number of policies and practices initiated during the pandemic. The Russian invasion of Ukraine during the year is posing a significant challenge to global supply chains and whilst Goldplat has no activities directly connected with Russia or Ukraine, the long-term effect of the conflict on the Group is uncertain. Although, the impact on fuel prices, currency exchange rates and global inflation continue to have an impact on the Company.

We look forward to continuing and building on the successes of the past few years and increasingly realising and growing the intrinsic value of Goldplat. I thank all Goldplat's employees, as well as my fellow directors, our advisors and our shareholders for their efforts as we look forward with enthusiasm.

Gerard Kemp

Chairman

17 February 2023



 

Operations and Finance Report

Overview

Goldplat plc is a mining services company, specialising in the recovery of gold and other precious metals, from by-products, contaminated soil and other precious metal material from mining and other industries. Goldplat has two market leading operations in South Africa and Ghana focused on providing an economic method for mines to dispose of waste materials while at the same time adhering to their environmental obligations.

Goldplat has been providing these services for more than 20 years mainly to the mining industry in Africa, but more recently also in South America. Goldplat's extraction processes and multiple process lines enable it to keep materials separate, which provides a high degree of flexibility when proposing a solution for a particular type of material. The processes which are employed include roasting in a rotary kiln, crushing, milling, thickening, flotation, gravity concentration, leaching, CIL, elution and smelting of bullion. Goldplat recovery operations recover between 2,000 ounces to 2,800 ounces monthly through its various circuits and under different contracts. The grade, recovery, margins and terms of contracts can differ significantly based on the nature of the material supplied and processed. At a minimum, 50% of material produced is exposed to the fluctuation in the gold price, with the remainder of the production being offset by corresponding changes in raw material costs.

The strategy of the company, which also drives the key performance indicators of management, is to return value to the shareholders by creating sustainable cash flow and profitability through: growing its customer base in South Africa, West Africa and further afield, increasing its ability to process lower grade contaminated material through investing into and improving processing methods; forming strategic partnerships with other industry participants; diversifying into processing of platinum group metals ("PGM") contaminated material; and constructing a final deposition site for, and optimising the processing of, the TSF.

Goldplat's highly experienced and successful management team has a proven track record in creating value from contaminated gold and other precious metals-bearing material.

Goldplat has a JORC defined resource (see the announcement dated 29 January 2016 for further information) over part of its active Tailings Storage Facility ('TSF') at its operation in South Africa of 1.43 million tons at 1.78g/t for 81,959 ounces of gold. Since the resource estimate was made more than 500,000 tons of material have been deposited on the TSF.

Goldplat held a 5.52% interest (at the balance sheet date) indirectly in Caracal PLC ("Caracal") and a 1% net smelter royalty (the Caracal holding was sold down to zero after the period), capped at USD1.5 million in Kilimapesa (the Kenyan Gold Mining Company it sold to Caracal).

Introduction

During the period, the recovery operations continued to deliver excellent returns with the profits after tax and attributable to owners of the Company increasing by 112%.

The increase was driven by strong performances by both operating entities, with Goldplat Recovery Pty Limited ("GPL") and Gold Recovery Ghana Limited ("GRG") increasing the respective net profit by 75% and 54%.

Revenue increased by 22% during the period due to an increase of supply of material during the period, driving increases in production and sales. This has been against a slight decrease in the average gold price during the period of USD1,833/oz (2021 - USD1,846/oz).

The margins of the Group depend upon the volume, quality and type of material received, the metals contained in such material, processing methods required to recover the metals, the final recovery of metals from such material, the contract terms, metals prices and foreign currency movements. During the period, the gross profit margin increased from 17.5% to 23.1%, which was largely driven by the weakening of the Ghanaian Cedi (GHS) during the period by 20% (refer table under financial review). This was however offset by foreign exchange losses, which increased by GBP685,000.

The table below on the operating performance of the two recovery operations combined (excluding other Group and head office cost, foreign exchange gains & losses, finance cost and taxes) indicates the ability of the recovery operations in South Africa and Ghana to produce profitably at various gold prices and production levels.


2022

2021

2020

2019

2018

2017

Average Gold Price per oz in US$ for the year

1 833

1 846

1 560

1 263

1 293

1 258

 

 

GBP'000

GBP'000

GBP'000

GBP'000

GBP'000

GBP'000

Revenue

43 222

35 400

24 809

21 769

28 962

28 501

Gross Profit

9 994

6 199

7 312

3 114

5 703

5 644

Other income

53

56

0

0

0

0

Administrative & Other Costs

2 332

1 694

1 977

861

1 390

1 008

Operating Profit before Finance Costs

7 715

4 561

5 335

2 253

4 313

4 636

Before the 2020 financial period, the cashflow generated was invested in sustaining and growing our mining portfolio in Africa, which we have exited during the prior year. Since then, the Group has been focussed on building the customer base in its recovery operations, increasing its contracted supply of raw material for CIL circuits in South Africa, building up its reserves and restructuring and positioning the Group to optimize the returns to shareholders.

During the period we progressed on all of these fronts, with the share buy-back of minority shareholders in GPL completed, increasing GPL low grade material supply from 2 years to more than 7 years through our relationship with DRD Gold Limited ("DRD Gold"), and securing supply from new customers.

The Group has also progressed on its other strategic initiatives, specifically, receiving a license to construct a new tailings facility, furthering discussions with DRD Gold for the processing of current tailings facility at one of its operations and continuing to invest into potential growth areas, specifically through research and analysis of other raw materials for processing and Platinum Group Metals ('PGM'), and extending its geographical reach in South America.

Management's key focus in the recovery operations remains to increase visibility of earnings through growing its customer base and contracted supply of raw material on site.

Goldplat Recovery (Pty) Limited - South Africa - ('GPL')

Revenues increased by 22.1% to GBP21.52 million (2021 - GBP17.62 million), in part due to the increase in gold produced and sold and in part due to the increase in the average gold price in South African Rand ('ZAR'). The profits from operating activities as a result increased by 48.1% to GBP4.77 million (2021 - GBP3.22 million).

By-products (carbon, woodchips, mill liners and other by-products)

Consolidation continues in the South African gold industry; mines are closing or are becoming more efficient in their processing, resulting in reduced volumes and grade of by-products received. GPL has retained all contracts during the period; however the risk of supply reduction remains due to the short-term nature of contracts. The focus remains on improving the service provided to the mines, with the aim of increasing the term of the contracts.

Low grade materials

The low-grade material processed through GPL's carbon-in-leach circuits ('CIL') is surface material that has been contaminated by more than 100 years of gold mining in South Africa. The gold grade in this material is between 1 to 3 grams a ton (average 2 grams per ton).

With improved mining and processing methods and focus on the environment, significant tonnages of these types of materials are not being generated, and what is being generated, is processed through the mines' own plants before closure. As a result, the quantities of such materials available to GPL will reduce. As a result, and subsequent to year end, GPL agreed with DRD Gold to remove low-grade carbon contaminated soils from their premises, on a cost per ton basis, which should provide circa 5 years of additional feed for our larger CIL circuit. The CIL circuit currently contributes between 20% to 30% of the South African operation´s production. The nature of the materials to be removed from DRD Gold will be variable in terms of the gold grade contained and the recoverability of the gold contained through our circuits. The analysis and processing of these materials to date has indicated that it will be viable to remove and process at current cost and price parameters.

This increases the availability of material for this circuit to more than 7 years and will form a good base for the business going forward.

Condition and reprocessing of the tailings' storage facility ("TSF")

The Department of Water and Sanitation of the Republic of South Africa has authorised the water use by GPL which includes the extraction and use of water in its recovery processes and the impact of its disposal of tailings on a new TSF, according to the conditions set out in the license, which is valid for 12 years.

The new TSF, which is adjacent to the current TSF, is expected to be constructed and completed by end of June 2023 at a further cost of GBP600,000. The new TSF is expected to have sufficient capacity to store the tailings we will produce in our current operations for the next seven years.

The new TSF will also allow us to divert all deposition from the current facility, which will provide us with the ability to use the current facility to recover the JORC resource through DRD Gold. To enable us to process the current TSF through a DRD Gold facility, we will require approval to install a pipeline to this DRD Gold processing facility and will need to finalise commercial agreements with the third‑party.

DRD Gold is assisting GPL to get approval for the construction of a pipeline to one of its plants. The pipeline will provide GPL with the ability to process the existing TSF at a DRD Gold processing facility. The negotiation of the terms and conditions of processing our existing TSF at a DRD Gold processing facility still needs to be finalised. The approval of the pipeline by authorities is taking longer than originally expected, but we believe this will be received, at the latest, by June 2023.

During the period we incurred GBP223,000 on application for the new TSF and maintenance of the current TSF.

GPL continues to make changes to its circuit to increase its ability to extract value from the lower grade materials. During the year under review, we installed and completed the following improvements in the plant:

•     We constructed a new flotation plant at cost of GBP267,000 which provide us flexibility in terms of recovery of PGM's from various types of contaminated material as well as improving gold recoveries on other material;

•    We incurred GBP58,000 on installation of a gravity concentrator circuit at our largest Milling and Carbon in Leach (CIL) circuit. This has increased production by 5% to 10% in this circuit, depending on the material that is being processed, but has resulted in more cash being locked up, as it takes 6 months to turn this material into cash.

Gold Recovery Ghana Limited - Ghana - ('GRG')

GRG focusses on the processing and recovery of gold from mine by-products and serves the industry in Ghana, West Africa, South America and other parts of Africa. The sourcing efforts in West Africa and further afield continued to benefit the Group through increased supply of material from our current suppliers. The increase in feed material and the depreciation of the cedi against the USD (by 20%) resulted in revenues increasing during the period from GBP17,778,000 to GBP21,703,000. As a result, GRG increased its profitability, posting an operating profit before finance cost of GBP4,297,000 (2021 - GBP2,574,000). However, as a result of the depreciation of the GHS against the USD, GRG incurred foreign exchange losses during the period of GBP897,000 (2021 - GBP75 403).

Notwithstanding the continued improved performance in GRG, and the growth potential of the West African market, GRG remains dependent on getting approval for export of material from neighbouring countries and GRG will remain subject to sourcing risk.

Due to the length of time it takes to extract value from material (120 to 210 days), from when material leaves the mines to when gold is recovered and subsequently sold, GRG obtains financing to settle payment to the mines earlier. The working capital finance cost for the period for GRG increased to GBP311,000 (2021 - GBP148,000) due to increases in sales and also the depreciation of the GHS against the USD.

Major investments made in Ghana in prior years have positioned GRG well to service its customers. The following initiatives will continue to manage and reduce the risk related to the procurement of sufficient materials for Ghana:

•    Expanding the successes achieved in Mali to other mines in Mali, Ivory Coast and Burkina Faso. Some of these efforts have been delayed due to the Covid-19 travel restrictions. In Burkina Faso, the case relating to the export of fine carbon material is still pending and partly delaying any further export of material. Our engagement with mine management and government officials on different levels has continued, with the aim of increasing our footprint to ensure regular supply. Specific progress in this regard has been made during the quarter in Cote d'Ivoire.

•     To support the sourcing and export of material to GRG, subsidiaries have been incorporated in Peru and Brazil during the period, and we have decided to establish a site in Brazil, although we have incurred or committed no expenditure so far on those subsidiaries. This should assist us in increasing our presence and service delivery in South America and specifically allow us to source and process lower grade material, which is not feasible to transport to our other facilities.

•    To reduce the risk at the Ghana operation, we continue to evaluate our options for processing of artisanal tailings material, including the possibility of finding a partner in country, whilst continuing to seek permission from the Minerals Commission to restart in some form the processing and/or tolling of tailings material.

Discontinued operations

Kilimapesa Gold (Pty) Limited - Kenya ('KPG')

The sale of KPG was completed in the prior year, during April 2021 to Mayflower Gold Investments Limited ('Mayflower'). The initial consideration receivable by Gold Mineral Resources Ltd ("GMR"), Goldplat's subsidiary, was in the form of a secured debenture of USD1,500,000, to be satisfied by cash and/or the issue of shares to that value in Papillon Holdings plc ('Papillon') payable on Papillon's re-admission to trading on the LSE following completion of the RTO, with 30% (USD450,000) of the initial consideration payable in cash. On 31 August 2021, Papillon Holdings plc, renamed as Caracal Gold plc ("Caracal"), had its ordinary shares commence trading on the Main Market for listed securities of the London Stock Exchange plc ('LSE') under the ticker GCAT with a contemporaneous dual listing on the Frankfurt Stock Exchange, which followed the completion of the reverse takeover of Mayflower. GMR received 103,835,953 shares (which represented 7.17% of its issued share capital) in Caracal on 31 August 2021, which represented 70% of the initial consideration of the sale of KPG to Mayflower. On 3 November 2021, the Company agreed with Caracal to take up the remainder of the initial share consideration on the sale of Kilimapesa at the initial listing price of Caracal and as a result, received a further 32 878 000 shares in lieu of a cash payment of US$450,000, increasing the Group's shareholding in Caracal to 9.2% at the time.

During the period the Company sold 32 878 000 shares for £310,778.29 and retained 103,835,953 shares (interest of 5.53%) in Caracal. Subsequent to the year-end the Company sold all its shares in Caracal for a total consideration of GBP681,000.

GMR is entitled to receive a further 1% net smelter royalty on all production from Kilimapesa up to a maximum of $1,500,000, on any future production from Kilimapesa.

During the period the Company has written-off balances outstanding from Kilimapesa to the value of GBP241,000, that related to a balance that was owing to the Group from Kilimapesa before the conclusion of the transaction.

Anumso Gold Project - Ghana ('AG')

The gold mining license under the Anumso Gold ('AG') project expired during March 2021 and was not renewed as was the intention of the Company and the joint venture partner, Desert Gold Ventures Inc. The investment in AG was disclosed as a discontinued operation during the prior year. During the period we have been informed that mineral right fees since 2013 are outstanding, which is being disputed. None of the joint venture partners intend to capitalise the AG project to settle the claim and current AG liabilities exceed its assets by the minerals right fees outstanding. The Company's share of outstanding minerals right fees is GBP369,000 and this has been included under loss from discontinued operations in the prior year.

Financial review

The major functional currencies for the Group subsidiaries are South African Rand (ZAR) and Ghana Cedi (GHS) whilst the presentation currency of the group is Pounds Sterling (GBP). The average exchange rates for the year are used to convert the Statement of Profit or Loss and Other Comprehensive Income for each subsidiary to Sterling. As set out in the table below, there it can be seen that the average ZAR strengthened and GHS weakened against the Pound Sterling, by 2.27% and 12.76% respectively. The exchange rates as at end of the period are used to convert the balance in the statement of Financial Position. As set out in the table below, the ZAR closing rate was similar to the previous period, whilst the GHS depreciated by 20%, which resulted in the GBP490,000 loss on exchange differences on translation during the period.



2022

GBP

2021

GBP

Variance

%

South African Rand (ZAR)

Average

20.26

20.73

2.27%

Ghanaian Cedi (GHS)

Average

8.84

7.84

-12.76%

South African Rand (ZAR)

As at 30 June 2022

19.80

19.80

0.00%

Ghanaian Cedi (GHS)

As at 30 June 2022

9.78

8.15

-20.00%

Apart from the gold price, the Group's performance is impacted by the fluctuation of its functional currencies against the USD in which a majority of its sales are recognised. The average exchange rates for the year used in the conversion of operating currencies against the USD during the period under review are set out in the table below


2022

USD

2021

USD

Variance

%

South African Rand (ZAR)

15.23

15.42

1.23%

Ghanaian Cedi (GHS)

6.66

5.82

-14.43%

Personnel

The Personnel expenses increased by 6.3% to GBP4,674,000 (2021 - GBP4,396,000) during the period, resulting from salary increases as well as increase of production personnel in South Africa from 292 to 325 as a result of temporary employees employed on the construction and maintenance of the tailings facility.

The net finance loss

The net finance loss for the period can be broken down into the following:

Interest component

2022

2021


GBP'000

GBP'000

Interest receivable

-

-

Interest payable on lease liabilities

(20)

(21)

Interest payable on borrowings

(184)

(110)

Interest on pre-financing of sales

(449)

(219)

Interest on bank overdraft

(3)

(16)

Intercompany foreign exchange (expense)

(157)

(513)

Operating foreign exchange losses

(1,071)

(30)

Net finance costs

(1,884)

(909)

Net finance costs increased to GBP1,884,000 (2021 - GBP909,000) during the period as a result of:

Increase in foreign exchange losses in operations of GBP1,071,000 specifically due to the continuous depreciation of the GHS against the USD during the period. As we pre-finance a portion of our sales to the smelters, the exchange rate on the day we received most of our funds was lower than the exchange rate on the day we recognise the sale in our records.

The ZAR:USD exchange rate did not move materially during the period, resulting in the intercompany loans to the holding companies from GPL, not experiencing the same foreign exchange impact as in the prior year, and as a result the foreign exchange loss related to the ZAR-USD exchange rate fell from GBP398,000 to GBP115,000 during the period. The Group has started to reduce intercompany loan balances during the period to reduce the impact of the significant fluctuation between reporting currencies and the currencies in which loans are denominated and will continue to reduce the balance during the next period.

As a result of an increase of turnover during the period in GRG and more gravity concentrates exported out of South Africa as a result of the installation of further gravity concentrator units, the interest on pre-financing of sales increased from GBP219,000 to GBP449,000.

The interest payable on borrowings increased during the period as a result of the buy-back of the minority share in GPL at the beginning of the period. The interest payable on borrowings in the previous period related to finance on group level to support working capital, specifically in GRG.

Taxation

During the period the income tax expense more than doubled, on increase of profits before tax of 65%. This has resulted in an increase of the effective tax rate from 24.7% to 30.2%, which was driven by the following

•     Increase in taxation rate of 1.94% for GPL, to 25.43%, due to increased profits resulting in higher taxation rate based on mining tax formula applied in South Africa;

•     Increase in GPL profits before taxation almost doubled from GBP2,358,000 to GBP4,648,000;

•     GPL contributed 77% of the pre taxation profits during the current period, versus 65% the previous year.

GRG is registered as a Free Zone company in Ghana and is taxed at 15% (2021 : 15%) during the current period.

During the period dividend from GPL to the company incurred a withholding dividend taxation charge of 5%. The withholding dividend tax for the period was GBP71,000 (2021 - GBP80,000).

Other comprehensive income

During the period the Group experienced a loss in foreign exchange translation reserve of GBP912,000 and was made up by mainly of:

•     Foreign exchange translation loss in GRG of GBP532,000 as a result of devaluation of the GHS during the period against the GBP by 20%

•     An additional GBP390,000 share of foreign exchange translation losses relating to GPL were transferred to the Company as a result of the share repurchases and issues made in GPL during the period;

•     The closing exchange rate between the ZAR and GBP did not fluctuate significantly during the period, resulting in a minimal foreign translation impact on the conversion of GPL's statement in financial position.

Property, plant & equipment

During the period we spent GBP850,000 on the acquisition and construction of plant and equipment, mainly at GPL in South Africa.

Apart from investment into a new flotation plant of GBP267,000, a gravity concentrator circuit of GBP58,000 and construction of a new tailings facility GBP223,000, as mentioned above, the remaining GBP175,000 capital incurred in GPL, was spent on water reticulation structures, upgrading CIL structures and other general construction.

We incurred GBP129,000 in GRG, mainly relating to upgrades on our rotary spiral circuits.

Intangible Assets

The intangible assets relate to the goodwill in the investment held in GMR and GPL. The balance has been assessed for impairment by establishing the recoverable amount through a value-in-use calculation, the detail of which has been disclosed in note 5.

Right-of-use asset

The right-of-use assets increased during the period by GBP2,000. The reason for the increase is due to assets with a value of GBP166,000 that were settled during the period, being transferred to Property, plant and equipment, as they are now owned by GPL.

GPL acquired heavy-duty vehicles and forklifts on finance leases for GBP233,000 and GRG acquired a forklifts on short-term finance lease for GBP66,000.

The remainder of the changes relate to amortisation for the year and foreign exchange movements as indicated in note 19.

Loan receivable

The loan receivable related to a balance that was receivable from the South African minority shareholders on the acquisition of shares (in GPL) and was denominated in ZAR. The balance of GBP636,000 was settled during the period as part of the repurchase of the minority's share (in GPL).

As part of the repurchase of the minority's share, shares were also issued to a new minority in South Africa, Aurelian, a portion of which is payable from dividend proceeds. The balance outstanding is GBP708,000.

Inventories

The increase of GBP3,615,000 in the inventory balance, relates mainly to an increase of GBP3,895,000 in inventory at GRG.


2022

2021


GBP'000

GBP'000

Precious Metals on hand and in process

8,186

4,303

Raw Materials

2,730

3,424

Consumable Stores

1,132

706


12,048

8,433

The increase in GRG inventory relates mainly to an increase in precious metals on hand and in process of GBP3,883,000 driven by an increase in the supply and grade of material received from customers during the last quarter, not yet delivered to the smelters.

The raw material stock is only held in South Africa, and relates to the low-grade material processed through our Carbon-In-Leach ('CIL') circuits. During the period we've processed some of the high grade, higher cost material and also reduced our stock holding on site by 13%. With the agreement reached with DRD Gold, by which we can remove and process materials on DRD Gold premises, we have not just increased the availability of raw material for processing, but also put GPL in a position to operate on lower levels of raw materials at our premises.

The increase in consumable stores was as a result of higher stock levels of production chemicals at period end.

Trade and other receivables

The Group's trade and other receivables fluctuates based on grade and volume of batches and material processed during different periods of the year in the two operating entities.

Apart from the gold bullion produced in South Africa, on which payment is received within 14 days, for the remainder of the concentrates we produce, the payment terms on average are between 4 to 5 months.

During the period, the trade and other receivables decreased by GBP3,101,000, mainly due to the reduction in trade receivables in GRG by GBP4,085,582. During the previous financial period, high grade batches were delivered during the 3rd and 4th quarter, resulting in high value material at smelters during the end of previous period.

In GPR, the trade and other receivables increased by GBP2,505,483 during the period, due to larger volumes of material delivered to the smelters closer to the end of the financial period.

Provisions

In terms of section 54 of the regulations of the Minerals Resource and Petroleum Act of 2002, in South Africa, a Quantum of Financial Provisioning is required for activities performed under mining lease. The Quantum was reassessed during the current period and increased by GBP24,000.

Deferred tax liabilities

The deferred tax liabilities increased during the period from GBP792,000 to GBP1,013,000 as a result of GBP850,000 and GBP299,000 capital expenditure incurred on property, plant and equipment and right of use assets respectively. The capital expenses were amortized in full for tax purposes, although limited depreciation was levied during the period.

Interest bearing borrowings

During the period , GPL entered into a ZAR denominated bank facility of ZAR 60 million (approximately GBP3.02 million) with Nedbank, to finance the repurchase of shares from minorities in South Africa. The full ZAR60 million was drawn during the first half of the year and the principal on the bank facility is repayable monthly over 36 months. The interest payable on the facility is the South African Prime Rate plus 1.75%.

GPL provided security over its debtors as well as a negative pledge over its moveable and any immovable property, with a general notarial bond registered over all movable assets. The Group entered into a limited suretyship for ZAR 60 million, in favour of Nedbank.

The balance outstanding on the reporting date was GBP2,395,000 of which GBP978,000 is repayable in the next 12 months.

As a condition to the Nedbank facility, the Group settled the balance outstanding of GBP33,000 on another USD2,000,000 revolving facility and cancelled the facility and relating securities.

Refer to note 18 for further disclosure.

Trade and other payables

The decrease in trade and other payables of GBP474,000, was mainly driven by the grade and volumes of material purchased and processed during the last quarter.

In general, we pay our suppliers before we recover the value from material processed and delivered to smelters or refiners. Suppliers are either paid in full or a percentage of the balance is paid until we get our final results from refiners or smelters. We receive external funding for material delivered to smelters to finance this gap between receipts and payments. During the period the balance funded remained relatively unchanged at GBP6,605,000 (2021 - GBP6,910,485)

Outlook

As per the outlook of the previous financial period, the focus during the period has been, and will continue to be on:

•     investing into research and development to identify different processing methods and equipment to maximize value from resources available;

•     expanding our environmental services delivery to industry;

•     identifying opportunities for growth in the recovery operations by investing into other locations and into additional equipment in our current operation, as well as enhancing operational efficiencies. This should enable the processing of lower grade material at current operations and at different locations closer to the source; and

•     further to the above, we will continue to leverage on industry relationships to increase long-term visibility so that we can increase our resources and available materials for processing.

The recovery operations have nearly always been cashflow generative and during the period we have utilized some of this cashflow to increase the Company's shareholding in GPL (effectively the share of the Group's investments) and purchasing shares from shareholders. The Company will remain focused on sharing future cashflows with shareholders, specifically distributing cash surplus (above Group's operational requirements and growth plans) to shareholders.

During the 2023 financial period the South African operations will need to complete its investment into a new tailings facility at cost of GBP600,000 and we expect to finance this from operational cash flow. The focus for Ghana remains on sourcing material from West Africa, South America and the other regions, whilst re- positioning GRG to process lower grade material sourced from within Ghana. In line with this, the Group intends to establish a site in Brazil to enable it to source and process lower grade material in South America.

The South African operations will continue to serve the South African gold industry and will focus on sustaining profitability from old mining clean-ups and as part of its diversification strategy has invested GBP267,000 of capital into processing PGM's during the period.

We are working with DRD Gold to find the most economical methods to reprocess TSF (which has a JORC Compliant Resource of 81,959 ounces) and receiving environmental approval for a pipeline which will be required to transport material to a facility for processing.

Goldplat recognises the cyclical nature of the recovery operations as well as the risks inherent in relying on short-term contracts for the supply of materials for processing, particularly in South Africa where the gold industry is in slow longer term decline. These risks can be mitigated by improving our operational capacities and efficiencies to enable us to treat a wider range of lower grade materials and leveraging on our strategic partnerships in industry to increase security of supply. We will continue to seek materials in wider geographic areas. We shall also keep looking beyond our current recovery operations for further opportunities to apply our skillsets and resources.

Conclusion

The last few years involved a lot of changes in Goldplat's business as we have set out to increase sustainability and growth of our recovery operations, I would like to compliment Goldplat's employees, its advisors, my fellow directors and the Company's shareholders not just for their efforts and support, but for how they have embraced the changes and remained focused on the opportunities they bring. This year we have seen the benefit of these changes and the board is looking forward to building on this year's successes, creating opportunities from the ever changing environment and returning value to shareholders.

Werner Klingenberg

Chief Executive Officer

17 February 2023



 

Statements of Financial Position


 

Group

Group

Figures in £ `000

 

2022

2021

Assets




Non-current assets




Property, plant and equipment


4 763

4 568

Right-of-use assets


576

574

Intangible assets


4 664

4 664

Investment in subsidiary or associate


1

1

Receivable on Kilimapesa sale


556

606

Other loans and receivables


189

636

Total non-current assets

 

10 749

11 049

Current assets




Inventories


12 048

8 433

Trade and other receivables


9 902

13 003

Current tax assets


100

-

Receivable on Kilimapesa sale


142

58

Investment in Caracal Gold


727

-

Other loans and receivables


8

-

Cash and cash equivalents


3 895

3 459

Total current assets

 

26 822

24 953

Total assets

 

37 571

36 002

Equity and liabilities

Equity




Share capital


1 678

1 698

Share premium


11 562

11 491

Share Redemption Reserve


53

-

Retained income / (accumulated loss)


9 530

6 846

Foreign exchange reserve


(6 170)

(5 258)

Total equity attributable to owners of the parent


16 653

14 777

Non-controlling interests


1 150

3 637

Total equity

 

17 803

18 414

Liabilities




Non-current liabilities




Provisions


811

787

Deferred tax liabilities


1 013

792

Interest bearing borrowings


1 417

-

Lease liabilities


111

110

Loan from group company

 

-

-

Total non-current liabilities

 

3 352

1 689



 

Statements of Financial Position

 

 

Group

Group

Figures in £ `000

 

2022

2021

Current liabilities




Provisions


208

-

Trade and other payables


14 971

15 445

Current tax liabilities


-

128

Interest bearing borrowings


978

33

Lease liabilities


259

293

Loan from group company


-

-

Total current liabilities


16 416

15 899

Total liabilities


19 768

17 588

Total equity and liabilities


37 571

36 002

The financial statements of Goldplat plc, company number 05340664, were approved by the Board of Directors and authorised for issue on 17 February 2023. They were signed on its behalf by: Werner Klingenberg, Director.

 

Werner Klingenberg

17 February 2023



 

Statements of Profit or Loss and Other Comprehensive Income

Figures in £ `000

 

Group

2022

Group

2021

Revenue


43 222

35 400

Cost of sales


(33 228)

(29 201)

Gross profit


9 994

6 199

Other income


53

56

Administrative expenses


(2 332)

(1 694)

Profit from operating activities


7 715

4 561

Finance costs


(1 884)

(909)

Profit before tax


5 831

3 652

Income tax expense - continuing operations


(1 868)

(903)

Profit from continuing operations


3 963

2 749

Loss from discontinued operations


-

(570)

Profit for the year


3 963

2 179

Profit for the year attributable to:




Owners of Parent


3 555

1 679

Non-controlling interest


408

500



3 963

2 179

Other comprehensive income net of tax




Exchange differences on translation relating to the parent




(Losses) / gains on exchange differences on translation


(522)

719

Exchange reserve reclassified on loss of control of Kilimapesa


-

247

Total Exchange differences on translation


(522)

966

Exchange differences relating to the non-controlling interest




(Losses)/Gains on exchange differences on translation


(5)

256

Total other comprehensive income that will be reclassified to profit or loss


(527)

1 222

Total other comprehensive income net of tax


(527)

1 222

Total comprehensive income


3 436

3 401

Comprehensive income attributable to:




Comprehensive income, attributable to owners of parent


3 033

2 645

Comprehensive income, attributable to non-controlling interests


403

756



3 436

3 401

Earnings per share from continuing and discontinuing operations attributable to owners of the parent during the year




Basic earnings per share




Basic earnings per share from continuing operations


2.08

1.32

Basic loss per share from discontinuing operations


-

(0.34)

Total basic earnings per share


2.08

0.98

Diluted earnings per share


 

 

Diluted earnings per share from continuing operations


2.05

1.32

Diluted loss per share from continuing operations


-

(0.33)

Total diluted earnings per share


2.05

0.99



 

Statements of Changes in Equity - Group

Figures in £ `000

Share Capital

Share premium

Share Redemption Reserve

Foreign currency translation reserve

Retained income

Attributable to owners of the parent

Non-controlling interests

Total

Balance at 1 July 2020

1 675

11 441

-

(6 224)

5 167

12 059

3 057

15 116

Changes in equity









Profit for the year

-

-

-

-

1 679

1 679

500

2 179

Other comprehensive income

-

-

-

719

-

719

256

975

Exchange reserve released through profit and loss on sale of Kilimapesa




247


247

-

247

Total comprehensive income for the year

-

-

-

966

1 679

2 645

756

3 401

Non-controlling interests in subsidiary dividend

-

-

-

-

-

-

(176)

(176)

Shares issued from options exercised

23

50

-

-

-

73

-

73

Balance at 30 June 2021

1 698

11 491

-

(5 258)

6 846

14 777

3 637

18 414

Balance at 1 July 2021

1 698

11 491

-

(5 258)

6 846

14 777

3 637

18 414

 

Figures in £ `000


Share Capital

Share premium

Share Redemption Reserve

Foreign currency translation reserve

Retained income

Attributable to owners of the parent

Non-controlling interests

Total

Changes in equity










Profit for the year


-

-

-

-

3 555

3 555

408

3 963

Other comprehensive loss


-

-

-

(522)

-

(522)

(5)

(527)

Total comprehensive income for the year


-

-

-

(522)

3 555

3 033

403

3 436

Non-controlling interests in subsidiary dividend


-

-

-

-

-

-

(139)

(139)

Decrease of Non-Controlling Interest (21.30%)

7




(500)

3 589

3 089

(3 089)

-

Increase of Non-Controlling Interest (4.67%)

7




110

(787)

(677)

677

-

Decrease of Non-Controlling Interest (4.24%)

7




(100)

715

615

(615)

-

Increase of Non-Controlling Interest (4.24%)

7




100

(715)

(615)

615

-

Cost of share repurchase in subsidiary (21.30%)






(3 999)

(3 999)

(413)

(4 412)

Proceeds on issue of shares in subsidiary (4.67%)






716

716

74

790

Cost of share repurchase in subsidiary (4.24%)






(653)

(653)

(68)

(721)

Proceeds on issue of shares in subsidiary (4.24%)



-

-

-

653

653

68

721

Cost of Share Options Issued


-


-

-

11

11

-

11

Cost of Company Shares Repurchase


(53)

-

53


(401)

(401)

-

(401)

Shares issued from options exercised


33

71

-

-

-

104

-

104

Balance at 30 June 2022


1 678

11 562

53

(6 170)

9 530

16 653

1 150

17 803

 


 

 

 

 

 

 

 

 



 

Statements of Cash Flows

 

 

Group

Group

Figures in £ `000

 

2022

2021

Net cash flows from / (used in) operations


6 471

4 277

Finance cost paid


(1 884)

(909)

Income taxes paid


(1 590)

(1 059)

Net cash flows from / (used in) operating activities


2 997

2 309

Cash flows (used in) / from investing activities




Proceeds from sale of Kilimapesa


312

-

Proceeds from sale of property, plant and equipment


142

18

Acquisition of property, plant and equipment


(850)

(979)

Decrease in cash from disposal of non-current assets held for sale


-

(6)

Receipt from long term receivable


-

74

Cost of Share Repurchase from Minority Shareholder in Subsidiary


(3 791)

-

Decrease of loans to subsidiary


-

-

Cash flows (used in) / from investing activities


(4 187)

(893)

Cash flows from / (used in) financing activities




Proceeds from drawdown of interest-bearing borrowings


3 031

-

Proceeds from issue of shares in Subsidiary to Minority Shareholder


247

-

Proceeds from exercise of share options


104

73

Payment of interest-bearing borrowings


(673)

(872)

Interest paid on interest-bearing borrowings


-

(99)

Cost of Share Repurchase in Company


(401)

-

Repayments of other financial liabilities


-

-

Repayment of leases


(367)

(186)

Interest paid on lease liabilities


-

(21)

Payment of dividend by subsidiary to non- controlling interest


(139)

(176)

Cash flows from / (used in) financing activities


1 802

(1 281)

Net increase / (decrease) in cash and cash equivalents


612

135

Cash and cash equivalents at beginning of the year


3 459

3 146

Foreign exchange movement on opening balance


(176)

178

Cash and cash equivalents at end of the year

 

3 895

3 459



 

Notes to the Accounts

1. General information

Goldplat plc (the 'Company') is a public company limited by shares domiciled and registered in England and Wales.

The address of the Company's registered office is Salisbury House, London Wall, London, the United Kingdom EC2M 5PS. The Group primarily operates as a producer of precious metals on the African continent.

2. Basis of preparation and summary of significant accounting policies

Statement of compliance

The consolidated financial statements have been prepared in accordance with UK - adopted International Accounting Standards ("IAS"), with future changes being subject to endorsement by the UK Endorsement Board, and the Companies Act 2006 as applicable to entities reporting in accordance with IAS ; as applicable to entities reporting in accordance with IFRS.

Basis of measurement

The consolidated financial statements have been prepared on the historical cost basis, except for derivative financial instruments that have been measured at fair value.

Functional and presentation currency

These consolidated financial statements are presented in Pounds Sterling ("GBP"), which is considered by the directors to be the most appropriate presentation currency to assist the users of the financial statements. All financial information presented in GBP has been rounded to the nearest thousand, except when otherwise indicated.

The Group's subsidiaries' functional currency is considered to be the South African Rand (ZAR), Ghana Cedi (GHS) and the Company's functional currency is Pounds Sterling (GBP) as these currencies mainly influences sales prices and expenses.

Use of estimates and judgements

The preparation of the consolidated financial statements in conformity with UK - adopted IFRS requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised if the revision affects only that period, or in the period of revision and future periods of the revision if it affects both current and future periods.

Critical estimates and assumptions that have the most significant effect on the amounts recognised in the consolidated financial statements and/or have a significant risk of resulting in a material adjustment within the next financial year are as follows:

-     Carrying value of goodwill to the value of £4,664,000 (2021: £4,664,000) (Note 5)

-     Inventory - precious metals on hand and in process to the value of £8,186,000 (2021: £4,303,000) (Note 11)

-     Rehabilitation provision £811,000 (2021: £787,000) (Note 16)

-     Useful economic lives (Note 2)

-     Estimated revenue to the value of £7,571,575 (2021: £10,790,069) (note 2.12)



 

 

 

 

 

 

Group 2022

Group 2021

3. Share capital

3.1 Authorised and issued share capital

Issued





Ordinary shares



1 678

1 698


 

 

1 678

1 698

Share premium



11 562

11 491


 

 

13 240

13 189

 





3.2 Additional disclosures

During the current year, additional shares were issued to current shareholders resulting in an increase in share capital and premium. The transactions are detailed below:


Date

Share Capital Movement

Share Premium Movement

Previous employee

6-Aug-21

10 000

21 250

Previous employee

13-Apr-22

10 000

21 250

Gerard Kisbey Green (Director)

6-Aug-22

13 333

28 333

Shares repurchased

During the period the company repurchased 5 325 000 number of shares, which was held in treasury, until it was subsequently cancelled. No shares are held in treasury at the balance sheet date. Share capital of GBP 53 000 has been transferred to a capital redemption reserve.

Capital Redemption Reserve

During the period the company repurchased 5 325 000 number of shares and value of GBP 53 000 incurred was transferred to this reserve (GBP 53 000 from Share Capital).

3.3 Reserves

Ordinary shares

All shares rank equally with regard to the Company's residual assets. The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote per share at meetings of the Company.

Share premium

Represents excess paid above nominal value on historical shares issued.

Exchange reserve

The exchange reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations.

Non-controlling interest

Relates to the portion of equity owned by minority shareholders.

Capital Redemption Reserve

Portion of share capital repurchased by the Company.

4. Employee benefits expense

Figures in £ `000

 

 

Directors emoluments

Executive

Non-executive

Total

2022




Wages and salaries

181

-

181

Fees

-

149

149

Other benefits

3

-

3

Total

184

149

333

2021




Wages and salaries

407

-

407

Fees

-

103

103

Other benefits

9

-

9

Total

416

103

519

Emoluments disclosed above include the following amounts paid to the highest director:


2022

2021

Emoluments for qualifying services

184

168

 

5. Earnings per share

5.1 Basic earnings per share


Group 2022

Group 2021

The earnings and weighted average number of ordinary shares used in the calculation of basic earnings per share are as follows:

 

 

Earnings used in the calculation of basic earnings per share for continuing operations

3 555

2 249

Weighted average number of ordinary shares used in the calculation of basic earnings per share

171 018

169 774

5.2 Diluted earnings per share

The earnings used in the calculation of diluted earnings per share are as follows:



Earnings used in the calculation of basic earnings per share for continuing operations

3 555

2 249

Earnings used in the calculation of basic earnings per share from discontinuing operations

-

(570)

The weighted average number of ordinary shares for the purpose of diluted earnings per share reconciles to the weighted average number of ordinary shares used in the calculation of basic earnings per share as follows:



Weighted average number of ordinary shares used in the calculation of basic earnings per share

 

171 018

 

169 774

Adjusted for



- Dilutive effect of share options

2 039

787

Weighted average number of ordinary shares used in the calculation of diluted earnings per share

 

173 057

 

170 561

6. Related parties

Other related parties

Entity name

2022 Holding

2021 Holding

Gold Mineral Resources Limited

100%

Direct

100%

Direct

Goldplat Recovery (Pty) Ltd

91%

Direct

74%

Direct

Goldplat Ghana Limited

100%

Indirect

100%

Indirect

Anumso Gold Limited

100%

Indirect

100%

Indirect

Nyieme Gold SARL

100%

Indirect

100%

Indirect

Midas Gold SARL

100%

Indirect

100%

Indirect

Gold Recovery Brasil Recuperacao

100%

Direct

0%


Gold Recovery Peru SAC

100%

Indirect

0%


GRG Tolling Ltd

100%

Indirect

100%

Indirect

Major inter-company transactions

 

Nature of transaction

2022

2021

Goldplat Recovery to Gold Recovery Ghana

Goods, equipment and services supplied

334

332

Goldplat Recovery to Gold Mineral Resources

Goods, equipment and services supplied

489

136

Goldplat Recovery to Gold Mineral Resources

Interest received

(120)

(125)

Goldplat Recovery to NMT Capital

Management fees

1

4

Goldplat Recovery to NMT Group

Managements fees

1

9

Goldplat Plc to Gold Mineral Resources

Management fees

-

413

Goldplat Recovery to Aurelian Capital

Trade and other payables

138

0

Goldplat Recovery to Aurelian Capital

Dividends Receivable - Aurelian

275

0

Goldplat Recovery to Aurelian Capital

Management fees

15

0

Goldplat Plc

Directors

149

98

Related Party Transactions with Mr Sango Ntsaluba

In the current period, the directors decided to increase the Group's interest in GPL, its principal operating subsidiary, from 74% to 90.63% through the buy-back by GPL of GPL shares from its minority shareholders. GPL has issued 4.90% shares in GPL (after the share repurchase) to Aurelian, a company controlled by Mr Sango Ntsaluba, in order to maintain a BEE partner in GPL and to reduce the cost to the Group of the share repurchase transaction.

After the completion of above transactions and cancellation of the repurchased shares, the Group held 90.63% of GPL (an increase of 16.63%), Amabubesi held 4.47% and Aurelian 4.90%. Subsequent to above, Amabubesi's remaining shares were repurchased and shares to the same amount and value issued to Aurelian. Aurelian is therefore the only minority partner in South Africa and holds 9.37% of GPL.

By virtue of their size and because Mr Ntsaluba is both a director of Goldplat and a major shareholder of Amabubesi and Dartingo(the two minority shareholders at that time), both the share repurchases by GPL of 22.33% of shares held by Amabubesi and Dartingo and the subsequent issue by GPL of shares to Aurelian constituted related party transactions under Rule 13 of the AIM Rules for Companies. The independent directors, being the Goldplat board members with the exception of Mr Ntsaluba, consider, having consulted with the Company's Nominated Adviser, Grant Thornton UK LLP, that the terms of the transactions were fair and reasonable insofar as Goldplat's shareholders are concerned.

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.
 
END
 
 
FR TLMPTMTTBBAJ
Find out how to deal online from £1.50 in a SIPP, ISA or Dealing account. AJ Bell logo

Related Charts

Goldplat PLC (GDP)

-0.24p (-3.58%)
delayed 12:43PM