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Altus Strategies PLC (ALS)

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Friday 20 August, 2021

Altus Strategies PLC

Quarterly Report & Financial Statements

RNS Number : 2460J
Altus Strategies PLC
20 August 2021
 

 

Altus Strategies Plc / Index (EPIC): AIM (ALS) TSX-V (ALTS) OTCQX (ALTUF) / Sector: Mining

 

20 August 2021

Altus Strategies Plc

("Altus" or the "Company")

 

Quarterly Report and Financial Statements

 

Altus Strategies Plc (AIM: ALS, TSX-V: ALTS, OTCQX: ALTUF) announces that it has published its unaudited financial results and its Management's Discussion & Analysis for the three-month and six-month periods ending 30 June 2021. These documents have been posted on the Company's website at www.altus-strategies.com/investors/financials/ and are also available on SEDAR at www.sedar.com.

 

HIGHLIGHTS

Highlights for the three months ended 30 June 2021 are as follows:

 

Operational highlights:

· Commencement of 17,500m Reverse Circulation ("RC") and Air Core ("AC") drilling programme at Diba gold project in western Mali

· Grant of three new projects, as well as exploration licences adjacent to existing projects, totalling 221km2 in Morocco

· Ground magnetic and soil sampling surveys at Tabakorole gold project in southern Mali have defined numerous additional targets

 

Corporate highlights:

· Appointments to the senior management team, strengthening the Company's corporate and technical capabilities across its key areas of operation:

Amilha Young as Company Secretary and Legal Counsel (UK);

Boubacar Thera as Corporate Manager (Mali); and

David Hall as Strategic Advisor (Egypt)

 

Financial highlights:

· Cash balance of £10.8m / C$18.5m as at 30 June 2021

· Cash outflow for operating activities of £1.2m / C$2.1m for six months ending 30 June 2021

· Balance of listed equity holdings of £2.0m / C$3.5m as at 30 June 2021

 

Post period:

· Agreement signed to acquire an effective 0.418% net smelter return ("NSR") royalty on Caserones Copper Mine ("Caserones") in northern Chile for US$34.1 million, expected to generate annual cash flow of US$3.2 million (post-tax) to Altus

· Strategic 50:50 partnership with NYSE American and TSX-V listed EMX Royalty Corp. ("EMX") via a Chilean special purpose vehicle ("SPV") holding a combined effective 0.836% NSR interest in Caserones

· US$29 million acquisition loan facility provided by a wholly-owned subsidiary of La Mancha Fund SCSp ("La Mancha")

· Initial results from RC drilling at the Diba gold deposit in western Mali, including 8.50 g/t gold ("Au") over 24m from 20m (including 26.45 g/t Au over 7m) and 2.54 g/t Au over 30m from 36m (results are down-the-hole and not true widths)

· Discovery of high-grade copper and silver from reconnaissance exploration at recently granted Azrar, Izougza and Tata projects in Morocco

· Significant increase in landholding at Tabakorole (by 100km2 to 292km2) under joint venture ("JV") with Australian Securities Exchange ("ASX") listed Marvel Gold Limited ("Marvel Gold")

· Encouraging diamond drilling ("DD") results from the first 11 holes at Tabakorole, which are expected to be incorporated into an updated Mineral Resource estimate ("MRE") in September 2021

· Grant of new exploration licences totalling 148.5km2 in Morocco, targeting copper and silver

· Appointment of Mark Campbell as Non-Executive Chairman of 100% owned subsidiary Akh Gold Holdings Ltd and General Manager (Egypt)

 

Steven Poulton, Chief Executive of Altus, commented:

"I am delighted to report on another very active quarter for Altus, during which Altus continued to deliver on its work programmes across its portfolio of projects, including drilling at our projects in Mali. With the receipt of £4.9m / C$8.5m at the start of the quarter, being the balance of proceeds from the March 2021 private placement, the Company ended the quarter with a strong cash balance of £10.8m / C$18.5m.

 

"Having completed a 10,000m RC drilling programme earlier in the year at Diba, we commenced a follow up programme at the end of May, incorporating RC and AC drilling. Of this programme, 7,500m will be AC drilling and will target a high priority 4km long and northerly striking zone, which may represent a potential extension of the Diba NW prospect. Diba NW was discovered by the phase-1 RC programme completed by Altus earlier in the year. Intersections from Diba NW included 1.45 g/t Au over 22m and 1.87 g/t Au over 10m (not true widths). The AC programme will also test the Diba Far East prospect, which is defined by numerous artisanal gold workings, with shafts reportedly dug up to 20m deep, coincident with significant structural targets as identified by the Company's ongoing ground magnetic survey.

 

"Marvel Gold continued to advance the Tabakorole JV project in southern Mali during the period, with a drilling programme targeting near-surface, high-grade intercepts that fall outside of the previously modelled MRE. A 177-hole AC drilling programme totalling 5,148m was completed during the quarter. This programme has confirmed mineralisation approximately 3km southeast of the main deposit. In addition to the drilling programmes, Marvel Gold has collected 4,267 soil samples and completed 5,300 line kilometres of high resolution ground magnetics, as part of its ongoing regional exploration programme, which includes Tabakorole.

 

"During the quarter, the Company conducted reconnaissance exploration on three recently granted copper focused projects totalling 221km2, located in the western anti-Atlas of Morocco; namely Azrar, Izougza and Tata. Analysis has confirmed the presence of prospective geological formations for stratiform sediment-hosted deposits and multiple historic artisanal workings. After the period, four further projects totalling 148.5km2 were granted in the western anti-Atlas of Morocco, increasing the Company's portfolio of projects in Morocco to 14, and its area of exploration to over 800km2.

 

"After the quarter end, on 16 August 2021, the Company concluded an agreement to acquire an effective 0.418% NSR royalty interest on the Caserones copper mine in the Atacama region of Chile, for a cash consideration of US$34.1 million. The NSR interest is expected to generate approximately US$3.2 million (post-tax) per year attributable to Altus. The Caserones mine is owned and operated by JX Nippon Mining & Metals Corporation of Japan and has an estimated 17 years of production remaining. The acquisition of the NSR interest will be part-financed by a US$29 million acquisition bridge loan facility ("Facility") provided by La Mancha, Altus' largest shareholder. The provision of the Facility underscores La Mancha's commitment to the long-term growth of Altus and the quality of the acquisition. The Company formed a strategic relationship with NYSE American and TSX-V listed EMX Royalty Corp., to acquire the NSR through the creation of a 50:50 owned Chilean SPV company. Altus' partnership with EMX is strengthened by Michael Winn, the Chairman of EMX, who is also a Non-Executive Director of Altus.

 

"Also following the period, we were delighted to report on excellent initial results from the current RC drilling programme at the Company's 100% owned Diba gold project in Western Mali. These included an exceptional intersection of 8.50 g/t Au over 24m from 20m downhole (not true width). The RC programme is designed to expand and infill the existing Diba resource, as well as define a maiden resource at the Diba NW prospect. Infill drilling within the current deposit has improved our understanding of the high-grade mineralisation that strikes northeast for approximately 550m through the Diba Deposit. 

 

"We look forward to another exciting quarter ahead, including the commencement of fieldwork in Egypt, further drilling programmes in Mali and an expansion of our due diligence capabilities as we accelerate the assessment of further cash paying royalty acquisition opportunities. "

 



 

INTERIM UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTHS ENDED 30 JUNE 2021

CONDENSED CONSOLDIATED INTERIM STATEMENT OF COMPREHENSIVE LOSS

 



For the three months ended

30 June


For the six months ended
30 June

 



2021


2020


2021


2020

 



£


£


£


£

 

Continuing operations









 

Revenue and costs recovered from joint venture partners


22,604


16,860


22,604


176,674

Exploration costs expensed


(559,089)


(288,227)


(1,345,788)


(588,984)

Administrative expenses


(254,437)


(125,737)


(472,814)


(308,311)

Listing and acquisition related costs


(2,575)


(39,758)


(7,493)


(46,864)

Foreign exchange gains/(losses)


19,261


72,054


(10,331)


55,324

Share based payments


(315,758)


-


(614,516)


(20,002)










 

Profit/(loss) from operations


(1,089,994)


(364,808)


(2,428,338)


(732,163)










Interest receivable


44


1,219


60


1,614

Interest payable


(1,187)


(1,769)


(2,451)


(3,665)

Other income/(costs)


(106)


-


-


1,109,001

Fair value gain/(loss) on investments


72,521


1,208,745


94,845


431,141










Profit/(loss) before taxation


(1,018,722)


843,387


(2,335,884)


805,928










Taxation


-


(71,209)


-


(71,209)










Total comprehensive profit/(loss) for the quarter


(1,018,722)


772,178


(2,335,884)


734,719










Profit/(loss) for the quarter attributable to:









  -  Owners of the parent company


(1,016,988)


772,205


(2,333,937)


735,171

  - Non-controlling interest


(1,734)


(27)


(1,947)


(452)



(1,018,722)


772,178


(2,335,884)


734,719

Total comprehensive profit/(loss) for the quarter attributable to:









  - Owners of the parent company


(1,016,988)


772,205


(2,333,937)


735,171

  - Non-controlling interest


(1,734)


(27)


(1,947)


(452)



(1,018,722)


772,178


(2,335,884)


734,719










 

Basic earnings per share (pence) attributable to the owners of the parent


(1.26)


1.10


(3.08)


1.17

 

Diluted earnings per share (pence) attributable to the owners of the parent


(1.26)


1.02


(3.08)


1.07

 

 



 

INTERIM UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTHS ENDED 30 JUNE 2021

CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION

 




As at 30 June


As at 31 December

 



2021


2020




£


£

Non-current assets






Intangible assets



3,689,499


3,277,381

Property, plant and equipment



8,462


4,720

Leased assets



50,166


60,198

Investments



2,033,794


1,320,542




5,781,921


4,662,841

Current assets






Trade and other receivables



288,474


853,629

Held-for-sale assets



86,554


86,765

Cash and cash equivalents



10,808,985


5,937,486




11,184,013


6,877,880

Total assets



16,965,934


11,540,721







Current liabilities






Trade and other payables



(748,213)


(1,144,754)

Held-for-sale liabilities



(34,020)


(34,020)

Provisions



(15,000)


(15,000)




(797,233)


(1,193,774)

Non-current liabilities






Trade and other payables



(40,631)


(45,848)

Total liabilities



(837,864)


(1,239,622)







Net assets



16,128,070


10,301,099







Equity






Share capital



4,019,576


3,504,580

Share premium



20,255,458


13,222,115

Translation reserve



(82,579)


(82,579)

Other reserves



6,973,529


6,359,013

Retained earnings



(14,934,686)


(12,600,749)






Total equity attributable to owners of the parent



16,231,298


10,402,380

Non-controlling interest



(103,228)


(101,281)

Total equity



16,128,070


10,301,099

 


INTERIM UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTHS ENDED 30 JUNE 2021

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY

 


Share capital

Share premium account

Translation reserve

Other reserves

Retained earnings

Total equity

Non-controlling interest

Total

Six months ended 30 June 2020:

£

£

£

£

£

£

£

£

Balance at 1 January 2020

2,102,284

7,378,369

(82,579)

5,755,070

(10,524,314)

4,628,830

(98,327)

4,530,503

Profit/(loss) and total comprehensive profit/(loss) for the period

-

-

-

-

646,137

646,137

(452)

645,685

Issue of shares

1,402,296

5,803,746

-

-

-

7,206,042

-

7,206,042

Expiry of share warrants

-

-

-

-

-

-

-

-

Total transactions with owners, recognised directly in equity

1,402,296

5,803,746

-

-

646,137

7,852,179

(452)

7,851,725










Balance at 30 June 2020

3,504,580

13,182,115

(82,579)

5,755,070

(9,878,177)

12,481,009

(98,779)

12,382,230










Six months ended 30 June 2021:









Balance as at 1 January 2021

3,504,580

13,222,115

(82,579)

6,359,013

(12,600,749)

10,402,380

(101,281)

10,301,099

Profit/(loss) and total comprehensive profit/(loss) for the period

-

-

-

-

(2,333,937)

(2,333,937)

(1,947)

2,335,884

Issue of shares

513,333

7,013,435

-

-

-

7,526,768

-

7,526,768

Exercise of warrants

1,663

19,908

-

-

-

21,571

-

16,812

Share based payment charge

-

-

-

614,516

-

614,516

-

298,758

Total transactions with owners, recognised directly in equity

514,996

7,033,343

-

614,516

(2,333,937)

5,828,918

(1,947)

5,826,971










Balance at 30 June 2021

4,019,576

20,255,458

(82,579)

6,973,529

(14,934,686)

16,231,298

(103,228)

16,128,070

 


INTERIM UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTHS ENDED 30 JUNE 2021

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS

 

Period ended 31 March

Three months


Six months


2021


2020


2021


2020


£


£


£


£

Cash flows from operating activities
















Profit/(loss) for the period after taxation

(1,018,722)


772,178


(2,335,884)


734,719

Adjustments for:








Net interest (received)/paid

1,143


2,166


2,391


3,665

Share based payments

315,758


-


614,516


20,002

Impairment of non-current assets

-


-


-


3,798

Bad debt provision

-


-


10,875


10,875

Depreciation of property, plant and equipment

5,278


6,076


12,481


12,469

Receipt of shares in investee

-


(1,614)


-


(1,110,613)

Fair value (gain)/loss on investments

(73,350)


(1,234,996)


(95,674)


(457,392)

Other gains/(losses)

-


(5,548)


-


38,952

Movements in working capital:








(Increase)/decrease in trade and other receivables

(167,396)


100,263


(63,088)


84,189

Increase/(decrease) in trade and other payables

(313,810)


(54,799)


(391,959)


(477,603)

Cash flows used in operating activities

(1,251,099)


(416,274)


(2,246,342)


(1,136,939)









Investing activities








Purchase of intangible assets

(257,782)


(31,729)


(412,118)


(60,301)

Purchase of property plant and equipment

(4,792)


(1,131)


(6,190)


(4,027)

Net interest received/(paid)

24


(2,167)


60


(1,915)

Net cash used in investing activities

(262,550)


(35,027)


(418,248)


(66,243)









Financing activities








Proceeds from issue of shares

4,917,650


-


7,548,339


6,483,561

Principal element of lease payments

(4,958)


(4,492)


(9,799)


(8,866)

Interest element of lease payments

(1,167)


(1,633)


(2,451)


(3,384)

Net cash generated from financing activities

4,911,525


(6,125)


7,536,089


6,471,311









Net increase/decrease in cash and cash equivalents

3,397,876


(457,426)


4,871,499


5,268,129

Cash and cash equivalents at beginning of the period

7,411,109


7,938,197


5,937,486


2,212,642

Cash and cash equivalents at the end of the period

10,808,985


7,480,771


10,808,985


7,480,771

 

Qualified Person

The technical disclosure in this regulatory announcement has been approved by Steven Poulton, Chief Executive of Altus. A graduate of the University of Southampton in Geology (Hons), he also holds a Master's degree from the Camborne School of Mines (Exeter University) in Mining Geology. He is a Fellow of the Institute of Materials, Minerals and Mining and has over 20 years of experience in mineral exploration and is a Qualified Person under the AIM rules and NI 43-101.

 

For further information you are invited to visit the Company's website www.altus-strategies.com or contact:

 

Altus Strategies Plc

Steven Poulton, Chief Executive

Tel: +44 (0) 1235 511 767

E-mail: [email protected]

SP Angel (Nominated Adviser)

Richard Morrison / Adam Cowl

 

Tel: +44 (0) 20 3470 0470

SP Angel (Broker)

Grant Barker / Richard Parlons

 

Tel:  +44 (0) 20 3470 0471

Shard Capital (Broker)

Isabella Pierre / Damon Heath

 

Tel: +44 (0) 20 7186 9927

Yellow Jersey PR (Financial PR & IR)

Charles Goodwin / Henry Wilkinson

Tel:  +44 (0) 20 3004 9512

E-mail: [email protected]

 

About Altus Strategies Plc

Altus Strategies (AIM: ALS, TSX-V: ALTS & OTCQX: ALTUF) is a mining royalty company generating a diversified and precious metal focused portfolio of assets.The Company's differentiated  approach of generating royalties on its own discoveries in Africa and acquiring royalties globally through financings and acquisitions with third parties, has attracted key institutional investor backing. The Company engages constructively with all stakeholders, working diligently to minimise its environmental impact and to promote positive economic and social outcomes in the communities where it operates. For further information, please visit  www.altus-strategies.com .

 

Cautionary Note Regarding Forward-Looking Statements

Certain information included in this announcement, including information relating to future financial or operating performance and other statements that express the expectations of the Directors or estimates of future performance constitute "forward-looking statements". These statements address future events and conditions and, as such, involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the statements. Such factors include, without limitation, the completion of planned expenditures, the ability to complete exploration programmes on schedule and the success of exploration programmes. Readers are cautioned not to place undue reliance on the forward-looking information, which speak only as of the date of this announcement and the forward-looking statements contained in this announcement are expressly qualified in their entirety by this cautionary statement.

 

Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is based on assumptions made in good faith and believed to have a reasonable basis. The forward-looking statements contained in this announcement are made as at the date hereof and the Company assumes no obligation to publicly update or revise any forward-looking information or any forward-looking statements contained in any other announcements whether as a result of new information, future events or otherwise, except as required under applicable law or regulations.

 

TSX Venture Exchange Disclaimer

Neither the TSX Venture Exchange nor the Investment Industry Regulatory Organisation of Canada accepts responsibility for the adequacy or accuracy of this release.

 

Market Abuse Regulation Disclosure

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is disclosed in accordance with the Company's obligations under Article 17 of MAR.



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