2020 Financial Statements Released

RNS Number : 8719Y
Pembridge Resources plc
17 May 2021
 

 

17 May 2021

 

2020 Financial Statements Released

London, United Kingdom - Pembridge Resources plc (LSE: PERE) ("Pembridge" or the "Company") is pleased to announce its annual report and consolidated financial statements for the year ended 31st December 2020.

On 17 May 2021 the Board of Directors of the Company approved the Annual Report and Consolidated Financial Statements for the year ended 31 December 2020.  During the year the Group made a loss of US$27,275,000 (2019 - loss of US$13,087,000).  The operating loss of $24,296,000 (2019: $11,818,000) comprised the mark-to-market revaluation of the Company's liability to Capstone of £9,369,000 (2019: exceptional expenses from the Minto acquisition of $2,347,000), administrative costs of the Company of $1,585,000 (2019: $3,049,000) and the loss from Minto of $13,342,000 (2019 post-acquisition: 3,049,000) which reflect the early stage of operations since re-starting in late 2019 and the challenges of 2020, including low copper prices and the staff quarantine and similar requirements caused by Covid-19, which are keeping the Minto mine safe but increased costs and affected efficiency.

The financial statements are available in pdf form on the Company's website using the link below. 

https://www.pembridgeresources.com/investors/financial-reports-and-presentations

The Company's Annual General Meeting will be held on 24 June 2021.  The meeting will not be open to shareholders and voting will be by proxy only, following government guidelines related to the Covid-19 pandemic. 

Extracts from the consolidated financial statements follow.

Gati Al-Jebouri, Chief Executive Officer and Chairman of the Board of Pembridge said:

"These results reflect 2020 being a year in which the Minto team developed the mine and laid the groundwork for future success, despite the unexpected challenges that they faced in the year from the Covid-19 pandemic and a low copper price. We are now seeing the benefit of this work in 2021 and the recently announced result of the 43-101 Preliminary Economic Assessment Technical Report shows the long-term potential and value of the investment in Minto."

Cautionary Statement

This News Release includes certain "forward-looking statements" which are not comprised of historical facts. Forward-looking statements include estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company, or management, expects a stated condition or result to occur. Forward-looking statements may be identified by such terms as "believes", "anticipates", "expects", "estimates", "may", "could", "would", "will", or "plan". Since forward-looking statements are based on assumptions and address future events and conditions, by their very nature they involve inherent risks and uncertainties. Although these statements are based on information currently available to the Company, the Company provides no assurance that actual results will meet management's expectations. Risks, uncertainties and other factors involved with forward-looking information could cause actual events, results, performance, prospects and opportunities to differ materially from those expressed or implied by such forward-looking information. Forward-looking information in this news release includes, but is not limited to, the Company's intentions regarding its objectives, goals or future plans and statements. Factors that could cause actual results to differ materially from such forward-looking information include, but are not limited to, the Company's ability to predict or counteract the potential impact of COVID-19 coronavirus on factors relevant to the Company's business, failure to identify additional mineral resources, failure to convert estimated mineral resources to reserves with more advanced studies, the inability to eventually complete a feasibility study which could support a production decision, the preliminary nature of metallurgical test results may not be representative of the deposit as a whole, delays in obtaining or failures to obtain required governmental, environmental or other project approvals, political risks, uncertainties relating to the availability and costs of financing needed in the future, changes in equity markets, inflation, changes in exchange rates, fluctuations in commodity prices, delays in the development of projects, capital, operating and reclamation costs varying significantly from estimates and the other risks involved in the mineral exploration and development industry, and those risks set out in the Company's public documents. Although the Company believes that the assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information, which only applies as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. The Company disclaims any intention or obligation to update or revise any forward-looking information, whether as a result of new information, future events or otherwise, other than as required by law.

 

ENDS

 

NOTES TO EDITORS

About Pembridge Resources plc

Pembridge is a mining company that is listed on the standard segment of the Official List of the FCA and trading on the main market for listed securities of London Stock Exchange plc. Pembridge has an investment in Minto Explorations Ltd, a British Columbia incorporated business operating the Minto mine in Yukon, Canada.

Enquiries:

 

Pembridge Resources plc:   +44 (0) 20 7917 2968

Gati Al-Jebouri, Chief Executive Officer and Chairman of the Board

David James, Chief Financial Officer

 

Brandon Hill Capital - United Kingdom:                                         +44 (0)20 3463 5016

Jonathan Evans
 

Consolidated statement of comprehensive income

 For the year ended 31 December 2020

 

 

 

 

 

 

 

Revenue from contracts with customers

 

 

 

Production costs

 

Mark-to-market revaluation of concentrate receivable

 

Royalties

 

Depreciation and amortisation

 

Administrative, legal and professional expenses

 

Exceptional items

- acquisition and re-admission costs

 

- revaluation of Capstone liability

 

Foreign exchange gain / (loss)

 

 

 

 

 

 

 

 

 

Operating loss

(24,296)

 

(11,818)

Finance income

 

Finance cost

 

 

 

 

 

 

 

 

 

Loss before income tax

(27,169)

 

(13,113)

 

 

 

 

Income tax

 

 

 

 

 

Loss for the year

(27,275)

 

(13,087)

 

 

 

 

Other comprehensive income

 

Total comprehensive income for the year

(27,450)

 

(12,151)

 

 

 

 

Loss is attributable to:

 

 

 

Non-controlling interest

Shareholders of the Company

 

Loss for the year

(27,275)

(13,087)

 

Total comprehensive income is attributable to:

 

 

 

Non-controlling interest

Shareholders of the Company

 

Total comprehensive income for the year

(27,450)

 

 

 

 

 

 

Earnings per share expressed in US cents

 

Basic and diluted loss per share attributable to the equity holders of the Company

 

 

 

 

Consolidated statement of financial position

 As at 31 December 2020

 

 

 

Non-current assets

 

 

 

Property, plant and equipment

 

Intangible assets

 

Long-term deposits

 

Total non-current assets

 

 

 

 

 

Current assets

 

 

 

Inventories

 

Trade and other receivables

 

Cash and cash equivalents

 

 Total current assets

 

 

 

 

 

Total assets

74,345

 

69,925

 

 

 

 

Non-Current liabilities

 

 

 

Borrowings

 

  Lease liabilities

 

  Reclamation and closure cost provision

 

  Deferred consideration due to Capstone

 

  Deferred tax liabilities

Total non-current liabilities

 

 

 

 

 

Current liabilities

 

 

 

Trade and other payables

 

Borrowings

 

  Lease liabilities

 

  Deferred consideration due to Capstone

 

Total current liabilities

 

 

 

 

 

Total liabilities

(85,167)

 

(56,910)

 

Net assets/(liabilities)

(10,822)

 

13,015

 

 

 

 

Equity

 

 

 

Share capital

 

Share premium

 

Capital redemption reserve

 

Translation reserve

 

Other reserve

 

Retained deficit

 

 

 

 

 

Equity attributable to shareholders of the Company

(19,133)

 

(2,048)

Non-controlling interests

 

 

 

Total equity

(10,822)

 

 13,015

 

 

 

 

 

 

 

Consolidated statement of changes in equity

For the year ended 31 December 2020

 

 

 

 

 

 

 

 

 

 

Balance at 1 January 2020

825

8,900

1,011

681

(13,465)

(2,048)

15,063

13,015

 

 

 

Loss for the year

-

-

 

Other comprehensive income - items that may be reclassified subsequently to profit or loss

 

 

 

Exchange difference on translation

-

 

 

Total comprehensive income for the year

 

Proceeds from shares issued

-

-

 

 

 

Equity element of convertible loan

-

 

 

Investment by non-controlling interest in Minto share capital

-

 

 

Change in share of economic interest in Minto

-

 

 

Share-based payments

 

Transfer to retained deficit after surrender of share options

-

 

 

Total transactions with owners recognised directly in equity

 

Balance at 31 December 2020

965

9,222

1,011

185

(30,516)

(19,133)

8,311

(10,822)

 

 

 

Consolidated statement of changes in equity

For the year ended 31 December 2019

 

 

 

 

 

 

 

 

 

 

Balance at 1 January 2019

295

2,902

1,011

66

(5,933)

(1,659)

-

(1,659)

 

 

 

Loss for the year

-

-

(8,063)

(8,063)

(5,024)

(13,087)

 

Other comprehensive income - items that may be reclassified subsequently to profit or loss

 

 

 

Exchange difference on translation

-

 

 

Total comprehensive income for the year

 

Proceeds from shares issued

-

-

 

 

 

Direct cost of shares issued

-

 

 

Equity element of convertible loan

-

 

 

Investment by non-controlling interest in Minto share capital

-

 

 

Non-controlling interest on acquisition of subsidiary

 

Share-based payments

 

 

Total transactions with owners recognised directly in equity

-

 

Balance at 31 December 2019

825

8,900

1,011

681

(13,465)

(2,048)

15,063

13,015

 

 

 

The following describes the nature and purpose of each reserve within Group and Company owners' equity:

 

Reserve

Description and purpose

Share capital

Nominal value of shares issued.

Share premium

Amount subscribed for share capital in excess of nominal value, less share issue costs.

Capital redemption reserve

Reserve created on cancellation of deferred shares.

Other reserve

Cumulative fair value of warrants and share options granted, together with the equity element of the convertible loan.

Translation reserve

Cumulative translation adjustment from retranslation of group undertakings with functional currencies other than USD.

Retained deficit

Cumulative net gains and losses recognised in the statement of comprehensive income.

Non-controlling interest

Non-controlling interests represent the portion of the equity of a subsidiary not attributable either directly or indirectly to the parent company and are presented separately in the Consolidated Statement of comprehensive income and within equity in the Consolidated statement of financial position, distinguished from parent company shareholders' equity.

 

 

 

Consolidated cash flow statement

 For the year ended 31 December 2020

 

 

 

Cash flows from operating activities

 

 

 

Loss for the year

 

Adjusted for:

 

Net finance costs

 

Unrealised FX on debt included in administrative expenses

 

Depreciation

 

Tax charge / (credit)

 

Share based payments

 

Revaluation of Capstone liability

 

 

 

 

 

 

(6,417)

 

(8,278)

Movements in working capital

 

 

 

Decrease / (increase) in inventories

 

Decrease / (increase) in trade and other receivables

 

Increase / (decrease) in trade and other payables

 

 

 

Cash used by operations

4,672

 

(13,026)

Income taxes recovered / (paid)

 

Net cash used in operating activities

4,672

 

(13,026)

Cash flows from investing activities

 

 

 

Payments into long-term deposits

 

Purchase of property, plant and equipment

 

Purchase of mining claims

 

 

 

 

 

Net cash used in investing activities

(7,255)

 

(2,309)

 

 

 

 

Cash flows from financing activities

 

 

 

Interest payments

 

Repayment of borrowings

 

Proceeds from borrowings

 

Lease payments

 

Proceeds from issuance of shares - Company

 

Proceeds from issuance of shares - Minto

 

 

 

 

 

Net cash generated from financing activities

1,993

 

16,138

 

 

 

 

Net increase in cash and cash equivalents

(590)

 

803

 

 

 

 

Cash and cash equivalents at beginning of year

Impact of exchange rates on cash balances

 

 

 

 

Cash and cash equivalents at end of year

415

 

964

 

 

 

BASIS OF PREPARATION

 

The Group's Financial Statements are presented in United States dollars (US$), which is also the functional currency of the Company, and rounded to the nearest thousand.

 

The Financial Statements from which these extracts are taken have been prepared in accordance with international accounting standards in conformity with the Companies Act 2006 and international financial reporting standards adopted pursuant to Regulation (EC) No.1606/2002 as it applies in the European Union. The Financial Statements have been prepared under the historical cost convention, except as modified for assets and liabilities recognised at fair value on a business combination and contingent consideration measured at fair value.

 

Going concern

 

The Financial Statements have been prepared on a going concern basis, which assumes that the Company and Group will continue operating in the foreseeable future and will be able to service their debt obligations, realise their assets and discharge their liabilities as they fall due.  The Company and Minto both have a planning, budgeting and forecasting process to determine the funds required to support their operations and expansionary plans.  The Company raised new equity in January 2021, which is expected to support its operations until it starts to receive repayments from Minto of its inter-company balance in 2022.  At 31 December 2020, Minto had cash of US$ 398,000 and available capacity of US$ 9.5 million under the prepayment facility with Sumitomo Canada Limited.  The Group's liabilities include a contingent consideration balance of US$ 18,571,000 due to Capstone, which is disclosed as a current liability and explained fully in note 32.  The amount that will actually be paid in respect of this obligation, and the timing thereof, is dependent on future copper price movements, so is not certain, and there may be scope to negotiate a delay in payments beyond one year if this is necessary.  Because the liability would become payable in full only if copper prices remain at or above certain levels, the same factors that would cause it to be payable would also assist the Group in funding it.  The Group's ability to continue as a going concern is dependent on their ability to obtain additional funding and the successful development of their existing assets in order to meet their planned business objectives.  However, because there can be no assurance of this funding or the Group's ability to generate positive cash flows, a material uncertainty exists which may cast doubt on the Group's ability to continue as a going concern.

At present the Group believes that there should be no significant material disruption to its mining operations from COVID-19, but the Board continues to monitor these risks and Minto's business continuity plans.

Having prepared forecasts based on current resources, assessing methods of obtaining additional finance and assessing the possible impact of COVID-19, the Directors believe the Group and Company have sufficient resources to meet its obligations for a period of 12 months from the date of approval of these Financial Statements. Taking these matters into consideration, the Directors continue to adopt the going concern basis of accounting in preparing these Financial Statements. The Financial Statements do not include the adjustments that would be required should the going concern basis of preparation no longer be appropriate.

 

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