Quarterly Update to 30 September 2021
Goldplat plc / Ticker: GDP / Index: AIM / Sector: Mining & Exploration
3 November 2021
Goldplat plc ('Goldplat' or 'the Company')
Quarterly Update to 30 September 2021
Goldplat plc, the AIM listed gold producer, with international gold recovery operations located in South Africa and Ghana, is pleased to announce an operational update for the first quarter of the current financial year ("Q1") ended 30 September 2021.
The recovery operations achieved the same combined operating profit for Q1 2021 as for Q1 2020 of £1,403,000 (Q1, 30 September 2020: £1,403,000), although the average gold price in USD decreased 6.7% for Q1 2021.
The Ghana operations continue to perform well as a result of the steady supply of material and achieved an operating profit for Q1 of £839,000 (Q1, 30 September 2020: £280,000). The South African operation achieved an operating profit for Q1 of £564,000 (Q1, 30 September 2020: £1,123,000), reflecting a significantly lower gold price in Rand terms in the period.
The following events have contributed to the Q1 operating results:
- The continued supply from current clients in Ghana and Mali was further supported by batches of material received from South America.
- 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 build on our market strategy in South America over the last 5 years, a decision has been made to expand the opportunities by establishing a processing and storage site in Brazil, at an initial cost of USD300,000, to capture part of the lower-grade material market which is not feasible to export to our other operations and also to improve services we can provide in country.
- We continue to evaluate our options for processing of artisanal tailings material, including the possibility of finding a partner in country.
- Although the gold produced and sold year-on-year was similar, the average gold price in South African Rands ('ZAR') for Q1 was 19.3% lower year-on-year, resulting in operating profits being lower by 50%.
- The Carbon-in-Leach ('CIL') circuits' production improved year-on-year by 9%, on the back of capital investment in the previous financial period in a jigging plant and a further GBP50,000 (less than the planned GBP75,000) incurred on a gravity circuit during Q1 on our largest milling and CIL plant.
- Gold produced from our by-products operations decreased by 16% as a result in variability of supply from the mines.
- As part our strategy to build partnerships in industry and to create longer term visibility of supply of materials and associated earnings, we have agreed with West Wits Mining Limited (ASX: WWI), as announced on 12 October 2021, to process material from their early mine programme through our plant on a toll treatment basis. The initial programme will last approximately 6 months with material processed through our largest CIL circuit, with the option to extend.
- During Q1 we have built our strategic precious metals ('PGM') material to a level to warrant capital expenditure of USD 300,000 on a plant to extract its value. This new plant will also enable us to further develop our PGM recovery business.
- Unrealised profits contained in material remains high at GBP900,000 (30 June 2021 - GBP1,100,000) and is partly due to the increase in gravity gold production and the longer sales cycle it takes to realise the profit. We are focussed on reducing the turnover time and the figure should return to normal levels, circa GBP500,000 within the next two quarters.
- Our application for the water use license was submitted in the last week of October 2021 and we should get feedback before the end of Q2. We continue to manage and extend the deposit of material within the Group's current tailings storage facility with the help of consulting engineers.
- Towards the end of October 2021 an application was made to get environmental approval for the installation of a pipeline to a process facility in the area. This pipeline could provide us with an avenue to pump and process our current tailings facility which contains circa 82,000 ounces of gold ('See the announcement dated 29 January 2016'). The approval process will take approximately 12 months.
Our cash balances remain strong at GBP2,340,000 at end of Q1.
The buy-back of the shares in Goldplat Recovery held by certain minority shareholders, as announced on 18 June 2021, was completed in October 2021, with the full lending facility of ZAR 60 million (approximately £3.1 million) drawn from Nedbank and all payments made to the respective minorities.
We have agreed with Caracal Gold to take up the remainder of the initial share consideration on the sale of Kilimapesa at the initial listing price of Caracal Gold and as a result, Caracal Gold has allotted an additional circa 32 878 000 shares in lieu of a cash payment of US$450,000, increasing the Group's shareholding in Caracal to 9.2%.
Werner Klingenberg, CEO of Goldplat commented: "I am pleased to see us continue to consolidate our interests in West Africa and look forward to build on this in South America. This, together with improvements in our production units in South Africa, is providing us with a platform to build longer term profitable recovery streams. I am encouraged by the progress made on the PGM front. With initial consideration on the sale of Kilimapesa and majority of the restructuring within the Group completed, we will evaluate our options to return value to shareholders."
** ENDS **
For further information visit www.goldplat.com, follow on Twitter @GoldPlatPlc or contact:
|Werner Klingenberg||Goldplat plc (CEO)||Tel: +27 (82) 051 1071|
|Colin Aaronson / George Grainger||Grant Thornton UK LLP (Nominated Adviser)||Tel: +44 (0) 20 7383 5100|
|Jessica Cave / Andrew de Andrade||WH Ireland Limited (Broker)||Tel: +44 (0) 207 220 1666|
|Tim Thompson / Mark Edwards / Fergus Mellon||Flagstaff Strategic and Investor Communications||Tel: +44 (0) 207 129 1474
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