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Metminco Limited (MNC)

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Thursday 13 September, 2018

Metminco Limited

Half-year Report

RNS Number : 6679A
Metminco Limited
13 September 2018
 

AIM ANNOUNCEMENT

13th September  2018

 

 

 

Half Year Report

Metminco Limited (ASX: MNC; AIM: MNC) is pleased to announce its Half Yearly Report for the period June 30th 2018.

This announcement is an abridged version of the announcement.  For the full announcement, please refer to the Company's website at www.metminco.com.au

 

Highlights

 

Principal Activities

The Group's Quinchia Gold Portfolio encompasses a potential near-term producing asset, the Miraflores Gold Project, as well as assets with substantial upside potential including the significant gold porphyry system targets of Tesorito, Dosquebrados and Chuscal. A Plan of works was submitted to the Colombian Mining Agency in January 2018 for the construction of the proposed Miraflores gold mine.

While the Company also retains its 100% Chilean Projects, the primary focus is on the Miraflores Gold Project and as such the Chilean projects are on care and maintenance.  These Chilean projects provide significant exposure to copper through Mollacas on which a mining study announced in 2014 demonstrated robust economics for development of the Mollacas Project, which is subject to resolution of a dispute with the land holder. The Vallecillo Project is a polymetallic deposit with identified resources.

Quinchia Gold Portfolio Colombia

In June 2016 the Company completed the acquisition of Miraflores Compañia Minera ("Miraflores Compañia") from RMB Resources Australia Pty Ltd.  Miraflores Compañia owns 100% of the Quinchia Gold Portfolio located within Colombia's Middle Cauca Belt approximately 90km WNW of the Colombian capital of Bogota and 55 km to the north of Pereira, the capital of the Department of Risaralda. 

 

The Quinchia Portfolio contains several gold deposits and exploration prospects including Miraflores, Dosquebradas, Tesorito and Chuscal. 

 

A review of the Columbian concessions during the half year resulted in the decision to relinquish a number of concessions and, in line with the Company's accounting policies, to impair some of the capitalised exploration on certain concessions. 

 

During the half year period a 1,500m diamond drilling program was commenced at Tesorito, part of the Quinchia Gold Portfolio. Results from the program were announced in August 2018 and included best intercept of 64m @ 1.67g/t Au from 144m within 253m @ 1.10 g/t from 2.9m from hole TS-DH-07 (refer ASX announcement of 30 August 2018).

Negotiations commenced with the owner of the Chuscal licence applications to form a joint venture. These discussions are ongoing as at the date of this report.

The Company submitted the Plan of Work ("PTO") to the Colombian Mining Agency for mine development approval for the Miraflores Gold Project in January 2018. Colombian regulations require both the PTO and Environmental Impact Assessment approvals prior to commencement of operations. As at the date of this report, approval of the PTO is awaited.

The critical path for the development of the project remains the completion of the EIA, including the validation of the impacts on the local communities and the gaining of the social licence for the project. Final, seasonal water monitoring was completed during the quarter and will inform the EIA submission.

 

Mollacas, Vallecillo, Loica Projects, Chile 

 

These projects remained on care and maintenance during the reporting period.  

 

Corporate

 

During the half year the new management of Company undertook a number of measures to reduce on-going costs, which necessitated some additional short-term expenses.  The Company's registered office was moved from Sydney to Melbourne.

 

Matters subsequent to the end of the financial period

Matters that have arisen in the interval between the end of the half year ended 30 June 2018 and the date of this report of a material or unusual nature are as follows:

Appointment of Nick Winer (2 August 2018) as Director of Exploration, based in Medellin, Colombia

Nick is a geologist with over 30 years' experience in gold, base metals in South America and will lead the Company's activities in Colombia, in particular, the advancement of the portfolio of gold assets in the Quinchia district.

On 13th September 2018, the Company entered into an unsecured loan facility arrangement with private investors to the value of $500,000 at a 12% coupon rate paid quarterly maturing 6 months from date of issue or earlier by the Company on 30 days' notice or on completion of a proposed capital raising.

On 13th September 2018, the Company entered into a Trading Halt on the ASX pending a corporate transaction and capital raising.

As at the date of this report, the Directors are not aware of any further matters that have arisen that have significantly affected, or may significantly affect, the operations of the Company 

 

 

CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

 

For the half year ended 30 June 2018

 

Note

 

30 June 2018

$

 

30 June 2017

$

 

 

 

 

Other income

 

2,496

-

 

 

 

 

Administration expenses

 

(122,692)

(288,047)

Corporate expenses                         

 

(1,685,036)

(1,267,766)

Occupancy expense

 

(67,677)

(51,860)

Exploration expenditure written off

9

(2,485,725)

(87,880)

Share based payments expense

12

(781,607)

-

Loss on sale of asset

 

-

(27,165,722)

Unrealised loss on derivative asset

 

-

(1,553,481)

Realised loss on derivative asset

5

(228,273)

(106,118)

Profit on disposal of assets

 

-

23,570

Finance costs

 

(230,253)

(229,730)

Loss before income tax

 

(5,598,767)

(30,727,034)

Income tax expense

 

-

-

Loss for the period from continuing operations

 

(5,598,767)

(30,727,034)

Other comprehensive income:

Items that may be reclassified subsequently to profit or loss:

 

 

 

Exchange differences on translating foreign controlled entities

 

 

 

 

435,451

(1,430,655)

Total comprehensive Loss for the period

 

(5,163,316)

(32,157,689)

 

 

 

 

Loss attributable to:

 

 

      Members of the parent entity

 

(5,598,767)

(30,727,034)

 

 

(5,598,767)

(30,727,034)

Total comprehensive (loss) attributable to:

 

 

 

      Members of the parent entity

 

(5,163,316)

(32,157,689)

 

 

(5,163,316)

(32,157,689)

Loss per share

 

 

 

      From continuing operations:

 

 

 

      Basic loss per share (cents)

 

(4.83)

(25.38)

      Diluted loss per share (cents)

 

(4.83)

(25.38)

 

 

 

 

 

These financial statements should be read in conjunction with the accompanying notes.

           

 

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

 

As at 30 June 2018

 

Note

 

30 June 2018

$

 

31 December 2017

$

ASSETS

 

 

 

CURRENT ASSETS

 

 

 

Cash and cash equivalents

 

1,705,998

834,377

Trade and other receivables

4

99,502

167,382

Derivative asset

5

-

272,683

Asset held for sale

6

2,726,512

2,586,122

Other assets

7

151,880

48,610

TOTAL CURRENT ASSETS

 

4,683,892

3,909,174

NON-CURRENT ASSETS

 

 

 

Property, plant and equipment

8

740,571

569,642

Exploration and evaluation expenditure

9

10,352,562

12,015,128

TOTAL NON-CURRENT ASSETS

 

11,093,132

12,584,770

TOTAL ASSETS

 

15,777,024

16,493,944

 

LIABILITIES

 

 

 

CURRENT LIABILITIES

 

 

 

Trade and other payables

10

3,907,227

3,392,074

Provisions

11

214,300

187,214

TOTAL CURRENT LIABILITIES

 

4,121,527

3,579,288

NON-CURRENT LIABILITIES

 

 

 

      Trade and other Payables

10

1,714,678

4,322,867

TOTAL NON-CURRENT LIABILITIES

 

1,714,678

4,322,867

TOTAL LIABILITIES

 

5,836,205

7,902,155

NET ASSETS

 

9,940,819

8,591,789

EQUITY

 

 

 

Issued capital

13

338,729,969

332,987,792

Other reserves

 

(28,685,744)

(29,914,047)

Accumulated losses

 

(300,103,406)

(294,481,956)

TOTAL EQUITY

 

9,940,819

8,591,789

 

 

 

 

These financial statements should be read in conjunction with the accompanying notes.

 

 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

For the half year ended 30 June 2018

 

 

 

Issued

Capital

Accumulated Losses

Option Reserve

Convertible Note equity reserve

Foreign Currency

Translation Reserve

 

Acquisition Reserve

Total

 

 

 

$

$

$

$

$

$

$

 

Balance at 1 January 2017

 

329,032,074

(259,254,583)

54,686

_

11,309,289

(41,506,662)

39,634,804

 

Loss attributable to members of the parent entity

 

_

(30,727,034)

_

_

_

_

(30,727,034)

 

Other comprehensive loss

 

_

_

_

_

(1,430,655)

_

(1,430,655)

 

Total comprehensive loss for the period

 

_

(30,727,034)

_

_

(1,430,655)

_

(32,157,689)

 

Shares issued during the period

 

4,375,000

_

_

_

_

_

4,375,000

 

Transaction costs

 

(314,703)

_

_

_

_

_

(314,703)

 

Equity component of convertible note

 

_

_

_

11,468

_

_

11,468

 

Options issued during the period

 

_

_

426,172

_

_

_

426,172

 

Balance at 30 June 2017

 

333,092,371

(289,981,617)

480,858

11,468

9,878,634

(41,506,662)

11,975,052

 

 

 

 

 

 

 

 

 

 

 

Balance at 1 January 2018

 

332,987,792

(294,481,956)

 480,860

11,448

11,100,307

(41,506,662)

8,591,789

 

Loss attributable to members of the parent entity

 

_

(5,598,767)

_

_

_

_

(5,598,767)

 

Other comprehensive loss

 

_

_

_

_

435,451

_

435,451

 

Total comprehensive loss for the period

 

_

(5,598,767)

_

_

435,451

_

(5,163,316)

 

Shares issued during the period

 

6,282,789

_

_

_

_

_

6,282,789

 

Transaction costs

 

(540,612)

_

_

_

_

_

(540,612)

 

Equity component of convertible note

 

-

_

_

(11,468)

_

_

(11,468)

 

Options issued during the period

 

-

-

781,617

_

_

_

781,617

 

Options expired -prior period adjustment

 

-

54,687

(54,687)

-

-

-

-

 

Balance at 30 June 2018

 

338,729,968

(300,026,036)

1,207,790

-

11,535,758

(41,506,662)

9,940,818

 

 

 

CONSOLIDATED STATEMENT OF CASH FLOWS 

For the half year ended 30 June 2018

 

Note

 

30 June 2018

$

 

30 June 2017

$

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

Payments to suppliers and employees

 

(1,677,704)

(1,573,133)

Interest received

 

2,496

-

Net cash used in operating activities

 

(1,675,208)

(1,573,133)

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

Purchase of property, plant and equipment

 

(170,394)

23,570

Payments for exploration expenditure

 

(712,408)

(1,203,307)

Payment of deferred consideration

 

(1,000,000)

-

Proceeds from sale of Los Calatos

 

-

6,601,155

Net cash (used in)/provided by investing activities

 

(1,882,802)

5,421,418

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

Proceeds from issue of shares

 

6,282,789

2,020,035

Payments in respect to capital raisings

 

(540,612)

(314,704)

Cash received from convertible notes

 

-

750,000

Cash paid for convertible notes redemption

 

(842,383)

-

Cash received from derivative asset

 

-

35,549

Cash received from equity swap

 

44,410

-

Net cash provided by financing activities

 

4,944,204

2,490,880

 

 

 

 

Net increase in cash held

 

1,386,194

6,339,165

Cash and cash equivalents at beginning of financial period

 

834,377

71,548

Effect of exchange rates on cash holdings in foreign currencies

 

(514,573)

(60,782)

Cash and cash equivalents at end of financial period

 

1,705,998

6,349,931

These financial statements should be read in conjunction with the accompanying notes.

This announcement contains inside information as stipulated under Article 7 of the Market Abuse Regulation (EU) No. 596/2014.

 

For further enquiries contact:

Kevin Wilson

Executive Chairman Metminco Limited;  

[email protected]

+61 409 942 355

 

For further information, please contact:

METMINCO LIMITED

 

 

Kevin Wilson

 

+61 409 942 355

 

 

 

NOMINATED ADVISOR AND JOINT BROKER

 

 

RFC Ambrian

 

 

Australia

 

 

Andrew Thomson / Alena Broesder

 

              +61 2 9250 0000

United Kingdom

 

 

Charlie Cryer

 

              +44 20 3440 6800

 

 

 

JOINT BROKER

 

 

Stockdale Securities

 

 

United Kingdom

Corporate Finance- Robert Finlay/ Ed Thomas

Sales- Zoe Alexander

 

              +44 20 7601 6100

 

 

 

PUBLIC RELATIONS

 

 

Camarco

United Kingdom

 

 

Gordon Poole / Nick Hennis

 

             +44 20 3757 4997

 

 

 

Forward Looking Statement

All statements other than statements of historical fact included in this announcement including, without limitation, statements regarding future plans and objectives of Metminco are forward-looking statements.  When used in this announcement, forward-looking statements can be identified by words such as ''anticipate", "believe", "could", "estimate", "expect", "future", "intend", "may", "opportunity", "plan", "potential", "project", "seek", "will" and other similar words that involve risks and uncertainties.

These statements are based on an assessment of present economic and operating conditions, and on a number of assumptions regarding future events and actions that, as at the date of this announcement, are expected to take place.  Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and other important factors, many of which are beyond the control of the Company, its directors and management of Metminco that could cause Metminco's actual results to differ materially from the results expressed or anticipated in these statements.

The Company cannot and does not give any assurance that the results, performance or achievements expressed or implied by the forward-looking statements contained in this announcement will actually occur and investors are cautioned not to place undue reliance on these forward-looking statements. Metminco does not undertake to update or revise forward-looking statements, or to publish prospective financial information in the future, regardless of whether new information, future events or any other factors affect the information contained in this announcement, except where required by applicable law and stock exchange listing.

 


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