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Serabi Gold plc (SRB)


Tuesday 30 November, 2021

Serabi Gold plc

Unaudited interim results for the third quarter and nine month period ended 30 September 2021

Unaudited interim results for the third quarter and nine month period ended 30 September 2021

For immediate release

30 November 2021


Serabi Gold plc

(“Serabi” or the “Company”)

Una udited interim r esults for the third quarter and nine month period ended 3 0 September 202 1


Serabi Gold plc (AIM:SRB, TSX:SBI), the Brazilian focused gold mining and development company, today releases its unaudited results for the nine month period ended 30 September 2021 (“the Period”)


A copy of the full interim statements together with commentary can be accessed on the Company’s website using the following link –


Financial Highlights

  • Post tax profit of US$7.66 million in the Period (2020: US$7.42 million).
  • Earnings per share of 10.64 cents compared with 12.58 cents for the same nine month period of 2020.
  • EBITDA of US$15.00 million in the Period (2020: US$15.66 million).
  • Net cash generated from operations of US$8.1 million in the Period (after mine development capital of US$3.8 million) (2020: US$11.4 million after mine development capital of US$2.0 million).
  • Net cash and cash equivalents of US$15.2 million as at 30 September 2021 (31 December 2020: US$6.6 million).
  • Average gold price of US$1,772 per ounce received on gold sales during the Period. (2020: US$1,647 per ounce)
  • Cash Cost for the Period of US$976 per ounce (2020: US$1,013 per ounce)
  • All-In Sustaining Cost for the Period of US$1,307 per ounce (2020: US$1,298 per ounce)

Operational Highlights

  • Third quarter gold production of 9,035 ounces, a 33 per cent improvement compared to the same period of 2020 (Q3 2020: 6,790 ounces). Gold production for the year to date (“ytd”) is 26,190 ounces, in line with guidance (2020 ytd: 24,314 ounces).
  • Total ore mined during the quarter of 42,240 tonnes at 7.18 grammes per tonne (“g/t”) of gold (Q3 2020; 44,097 tonnes at 4.84 g/t), the highest quarterly mined grade since the first quarter of 2019 and a 28 per cent improvement in grade compared to the average for 2020.
  • 41,995 tonnes of run of mine (“ROM”) ore were processed during the quarter through the plant from the combined Palito and São Chico orebodies, with an average grade of 7.20 g/t of gold (Q3 2020: 46,135 tonnes at 4.75 g/t), a 28 per cent improvement on the average plant grade for 2020.
  • 2,842 metres of horizontal development completed during the quarter, bringing the year-to-date total to 9,376 metres.
  • CV-19 protocols established to support the return to full operations in the fourth quarter of 2020, remain in place, and supply chains continue to improve.

Clive Line, CFO of Serabi commented,


“Gold sales completed during the nine months to 30 September 2021 have totalled 25,434 ounces with total production for the period being 26,190 ounces with the third quarter representing another solid quarter of production with 9,035 ounces of gold.


“Operating costs have increased year on year by US$2.3 million, following the return of contractors to undertake underground drilling activities. US$1.0 million has been incurred in underground drilling year to date to improve short term and long term mine planning. Labour costs have also increased by US$0.76 million compared with 2020 reflecting the return to normal working routines compared with the lower staffing levels experienced during 2020 when at the peak of the pandemic it was necessary to reduce staff headcount at the mine sites.


“Whilst the AISC for the year to date of US$1,307 per ounce is slightly higher than that for the equivalent period in 2020, this is reflective of the increased level of mine development. The cash cost of production has reduced by 4% to US$976 per ounce.


“Cash holdings of US$15.2 million at the end of the period reflect operating cash flow of US$8.15 million from the Palito Complex operations, including mine development of US$3.8 million. Expenditure during the last 3 months on the Coringa operation has increased significantly following the start of the initial mine development including the establishment of the mine portal for the Serra deposit. The ramp has now achieved approximately 90 metres of development. Expenditure on the project in the nine months to the end of September was US$3.0 million with US$1.7 million incurred in the third quarter.


“Expenditure on purchases of new plant and equipment, exploration activities and the development of Coringa has totalled US$8.7 million for the year to date which has been met by the cash flow being generated by the current production operations.


“The financial results reflect the continuing benefits of solid gold production over the first nine months of 2021, a continued strong gold price and favourable exchange rates resulting in an EBITDA of US$15 million for the year to date.


“Gold prices, in USD terms, have fluctuated over the last two months in reaction to perceptions of world economies starting to improve and in particular signals of future interest rate increases in the United States and risk appetite. These fluctuations generally have been following movements in the US dollar against other world currencies and has been reflected in the relative movements of the Brazilian Real. The gold price in BRL terms remains strong.”

Key Financial Information

  3 months to

30 September 2021

3 months to

30 September 2020

9 months to

30 September 2021

9 months to

30 September 2020

Revenue 14,210,749 15,941,963 46,741,222 45,403,793
Cost of sales (8,870,024) (8,487,475) (27,227,697) (24,908,688)
Gross operating profit 5,340,725 7,454,488 19,513,525 20,495,105
Administration and share based payments (1,391,574) (1,168,595) (4,514,034) (4,838,661)
EBITDA 3,949,151 6,285,893 14,999,491 15,656,444
Depreciation and amortisation charges (1,376,482) (1,484,715) (4,093,089) (4,716,809)
Operating profit / (loss) before finance and tax 2,572,669 4,801,178 10,906,402 10,939,635
Profit / (loss) after tax 1,308,948 3,779,901 7,661,601 7,419,295
Earnings per ordinary share (basic) 1.73c 6.41c 10.64c 12.58c
Average gold price received (US$/oz) US$1,753 US$1,881 US$1,772 US$1,707
    As at

30 September 2021

As at

31 December 2020

As at

30 June 2020


Cash and cash equivalents   15,165,875 6,603,620 10,968,059
Net assets   79,937,364 57,747,524 52,923,589

Cash Cost and All-In Sustaining Cost (“AISC”)        
    9 months to

30 September 2021
12 months to

31 December

9 months to 30 September 2020
Gold production for cash cost and AISC purposes   26,190 ozs 31,212 ozs 24,748 ozs
Total Cash Cost of production (per ounce)   US$976 US$1,075 US$1,013
Total AISC of production (per ounce)   US$1,307 US$1,374 US$1,298

    Qtr 1 Qtr 2 Qtr 3 YTD Qtr 1 Qtr 2 Qtr 3 Qtr 4 Full Yr
2021 2021 2021 2021 2020 2020 2020 2020 2020
Gold production (1)(2) Ounces 8,087 9,048 9,035 26,190 9,020 8,504 6,790 6,898 31,212
Mined ore – Total Tonnes 40,371 43,051 42,240 125,663 42,036 43,519 44,097 46,275 175,928
  Gold grade (g/t) 6.27 7.12 7.18 6.89 6.54 5.85 4.84 5.24 5.59
Milled ore Tonnes 41,462 43,679 41,995 127,137 40,465 44,235 46,135 43,440 174,276
  Gold grade (g/t) 6.27 7.09 7.20 6.86 6.66 5.91 4.75 5.27 5.62
Horizontal development – Total Metres 3,573 2,961 2,842 9,376 2,878 3,004 3,037 3,353 12,272
  1. The table may not sum due to rounding.
  2. Production numbers are subject to change pending final assay analysis from refineries.


The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018. The person who arranged the release of this statement on behalf of the Company was Clive Line, Director.




Serabi Gold plc  
Michael Hodgson Tel: +44 (0)20 7246 6830
Chief Executive Mobile: +44 (0)7799 473621
Clive Line Tel: +44 (0)20 7246 6830
Finance Director Mobile: +44 (0)7710 151692
Email: [email protected]  
Beaumont Cornish Limited

Nominated Adviser and Financial Adviser
Roland Cornish / Michael Cornish Tel: +44 (0)20 7628 3396
Peel Hunt LLP

Joint UK Broker
Ross Allister / Alexander Allen Tel: +44 (0)20 7418 9000
Tamesis Partners LLP

Joint UK Broker
Charlie Bendon / Richard Greenfield Tel: +44 (0)20 3882 2868

Financial PR
Gordon Poole / Nick Hennis Tel: +44(0) 20 3757 4980


Copies of this announcement are available from the Company's website at


Neither the Toronto Stock Exchange, nor any other securities regulatory authority, has approved or disapproved of the contents of this announcement.


The following information, comprising, the Income Statement, the Group Balance Sheet, Group Statement of Changes in Shareholders’ Equity, and Group Cash Flow, is extracted from the unaudited interim financial statements for the six months to 30 June 2021

Statement of Comprehensive Income

For the nine month period ended 30 September 2021

    For the three months ended
30 September
For the nine months ended
30 September
    2021 2020 2021 2020
(expressed in US$) Notes (unaudited) (unaudited and restated) (unaudited) (unaudited and restated)
Revenue   14,210,749 15,941,963 46,741,222 45,403,793
Cost of sales   (8,870,024) (8,487,475) (27,227,697) (24,908,688)
Depreciation and amortisation charges   (1,376,482) (1,484,715) (4,093,089) (4,716,809)
Total cost of sales   (10,246,506) (9,972,190) (31,320,786) (29,625,497)
Gross profit   3,964,243 5,969,773 15,420,436 15,778,296
Administration expenses   (1,648,211) (1,042,013) (4,654,625) (4,705,158)
Share-based payments   (71,903) (182,740) (208,103) (344,578)
Gain on disposal of assets   328,540 56,158 348,694 211,075
Operating profit   2,572,669 4,801,178 10,906,402 10,939,635
Foreign exchange gain/(loss)   125,566 51,642 81,823 (99,032)
Finance expense 2 18,140 (376,498) (322,418) (1,308,463)
Finance income 2 16,547 53,736
Profit before taxation   2,716,375 4,492,869 10,665,807 9,585,874
Income tax expense 3 (1,407,427) (712,966) (3,004,206) (2,166,581)
Profit after taxation   1,308,948 3,779,901 7,661,601 7,419,295
Other comprehensive income (net of tax)          
Exchange differences on translating foreign operations   (4,468,408) (1,397,149) (2,240,458) (20,614,659)
Total comprehensive profit /(loss) for the period (1)   (3,159,460) 2,382,752 5,421,143 (13,195,364)
Profit per ordinary share (basic) 4 1.73c 6.41c 10.64c 12.58c
Profit per ordinary share (diluted) 4 1.70c 5.97c 10.47c 11.71c

(1)         The Group has no non-controlling interests and all losses are attributable to the equity holders of the parent company.






Balance S heet as at 3 0 September 20 2 1

(expressed in US$) Notes  

As at
30 September 2021 (unaudited)
As at
30 September 2020
(unaudited and restated)
As at
31 December 2020
Non-current assets          
Deferred exploration costs 6   33,034,342 24,297,182 27,778,354
Property, plant and equipment 7   26,476,342 23,198,935 26,235,551
Right of use assets 8   2,274,281 2,207,297 2,573,738
Taxes receivable     1,257,745 828,083 696,077
Deferred taxation     637,071 229,464 1,879,158
Total non-current assets     63,679,781 50,760,961 59,162,878
Current assets          
Inventories 9   7,771,427 5,308,012 6,979,438
Trade and other receivables     2,147,503 2,076,263 1,936,044
Prepayments and accrued income     2,313,484 2,329,770 1,554,991
Cash and cash equivalents     15,165,875 10,968,059 6,603,620
Total current assets     27,398,289 20,682,104 17,074,093
Current liabilities          
Trade and other payables     7,155,764 4,573,988 6,846,202
Interest bearing liabilities 10   278,857 11,379,069 8,726,302
Derivative financial liabilities 11   411,123 390,456
Accruals     396,670 293,062 292,089
Total current liabilities     7,831,291 16,657,242 16,255,049
Net current assets     19,566,998 4,024,862 819,044
Total assets less current liabilities     83,246,779 54,785,823 59,981,922
Non-current liabilities          
Trade and other payables     83,722 82,261 91,916
Interest bearing liabilities 10   538,144 181,348 350,931
Deferred tax liability     903,421 324,519
Derivative financial liabilities 11   394,529
Provisions     1,389,599 1,598,625 1,467,032
Total non-current liabilities     3,309,415 1,862,234 2,234,398
Net assets     79,937,364 52,923,589 57,747,524
Share capital 14   11,213,618 8,905,116 8,905,116
Share premium reserve     36,158,068 21,905,976 21,905,976
Option reserve 14   1,012,820 984,358 1,173,044
Other reserves     12,151,873 9,970,276 10,254,048
Translation reserve     (66,245,416) (69,028,477) (64,004,958)
Retained surplus     85,646,401 80,186,340 79,514,298
Equity shareholders’ funds     79,937,364 52,923,589 57,747,524

The interim financial information has not been audited and does not constitute statutory accounts as defined in Section 434 of the Companies Act 2006. Whilst the financial information included in this announcement has been compiled in accordance with International Financial Reporting Standards (“IFRS”) this announcement itself does not contain sufficient financial information to comply with IFRS. The Group statutory accounts for the year ended 31 December 2020 prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 have been filed with the Registrar of Companies. The auditor’s report on these accounts was unqualified. The auditor’s report did not contain a statement under Section 498 (2) or 498 (3) of the Companies Act 2006.

Statements of Changes in Shareholders’ Equity

For the nine month period ended 30 September 2021


(expressed in US$)              
(unaudited) Share
Share option reserve Other reserves (1) Translation reserve Retained Earnings Total equity
Equity shareholders’ funds at 31 December 2019 (restated) 8,882,803 21,752,430 1,019,589 7,149,274 (48,413,818) 75,208,238 65,598,516
Foreign currency adjustments (20,614,659) (20,614,659)
Profit for the period 7,419,295 7,419,295
Total comprehensive income for the period (20,614,659) 7,419,295 (13,195,364)
Shares issued in the period 22,313 153,456   175,859
Transfer to taxation reserve 2,821,002 (2,821,002)
Share options exercised in period (31,752) 31,752
Share options lapsed in period (348,057) 348,057
Share option expense 344,578 344,578
Equity shareholders’ funds at 30 September 2020 (restated) 8,905,116 21,905,976 984,358 9,970,276 (69,028,477) 80,186,340 52,923,589
Foreign currency adjustments 5,023,519 5,023,519
Profit for the period (388,270) (388,270)
Total comprehensive income for the period 5,023,519 (388,270) (388,270)
Transfer to taxation reserve 283,772 (283,772)
Share option expense 188,686 188,686
Equity shareholders’ funds at 31 Dec 2020 8,905,116 21,905,976 1,173,044 10,254,048 (64,004,958) 79,514,298 57,747,524
Foreign currency adjustments (2,240,458) (2,240,458)
Profit for the period 7,661,601 7,661,601
Total comprehensive income for the period (2,240,458) 7,661,601 5,421,143
Transfer to taxation reserve 1,897,825 (1,897,825)
Share Premium
Share Issued during period 2,308,502 14,252,092 16,560,594
Share options lapsed in period (368,327) 368,327
Share option expense 208,103 208,103
Equity shareholders’ funds at 30 September 2021 11,213,618 36,158,068 1,012,820 12,151,873 (66,245,416) 85,646,401 79,937,364

(1) Other reserves comprise a merger reserve of US$361,461 and a taxation reserve of US$11,790,412 (31 December 2020: merger reserve of US$361,461 and a taxation reserve of US$9,892,587).


Cash Flow Statement

For the nine month period ended 30 September 2021

  For the three months
30 September
For the nine months
30 September
  2021 2020 2021 2020
(expressed in US$) (unaudited) (unaudited) (unaudited) (unaudited)
Operating activities        
Post tax profit for period 1,308,948 3,779,901 7,661,601 7,419,295
Depreciation – plant, equipment and mining properties 1,376,482 1,484,715 4,093,089 4,716,809
Net financial expense (143,706) 308,309 240,595 1,353,759
Provision for taxation 1,407,427 712,966 3,004,206 2,166,581
Share-based payments 71,903 182,740 208,103 399,284
Taxation Paid (203,221) (333,922)
Interest Paid (12,891) (2,753) (1,295,724) (265,751)
Foreign exchange (loss) / gain 49,636 (79,732) (138,928) (125,537)
Changes in working capital        
  (Increase)/decrease in inventories (663,820) 55,650 (763,112) (733,883)
  (Increase) in receivables, prepayments and accrued income (259,673) (997,396) (1,104,846) (1,997,572)
  Increase/(decrease) in payables, accruals and provisions 287,149 277,539 378,041 220,307
Net cash inflow from operations 3,218,234 5,721,942 11,949,103 13,153,292
Investing activities        
Purchase of property, plant and equipment and assets in construction (1,698,160) (860,020) (2,439,463) (2,049,973)
Mine development expenditure (1,244,454) (784,203) (3,802,795) (2,005,880)
Geological exploration expenditure (1,474,640) (267,338) (3,274,609) (1,352,610)
Pre-operational project costs (1,753,513) (149,457) (3,019,404) (627,097)
Acquisition payment for subsidiary (2,500,000) (5,500,000) (3,500,000)
Acquisition of other property rights (930) (150,789) (102,316) (483,302)
Proceeds from sale of assets 340,664 72,188 365,745 400,047
Interest received 911
Net cash outflow on investing activities (5,831,033) (4,639,619) (17,772,842) (9,617,904)
Financing activities        
Issue of Ordinary share capital (net of costs) 16,560,594
Issue of warrants 333,936
Drawdown of convertible loan 500,000 2,000,000
Repayment of convertible loan (2,000,000)
Repayment of secured loan (6,983,492)
Payment of finance lease liabilities (85,990) (203,080) (349,269) (249,354)
Net cash (outflow) / inflow from financing activities (85,990) 296,920 14,545,261 (5,232,846)
Net increase / (decrease) in cash and cash equivalents (2,698,789) 1,379,242 8,721,522 (1,697,458)
Cash and cash equivalents at beginning of period 18,121,392 9,627,412 6,603,620 14,234,612
Exchange difference on cash (256,728) (38,596) (159,267) (1,569,095)
Cash and cash equivalents at end of period 15,165,875 10,968,059 15,165,875 10,968,059


1. Basis of preparation
These interim condensed consolidated financial statements are for the nine month period ended 30 September 2021. Comparative information has been provided for the unaudited nine month period ended 30 September 2020 and, where applicable, the audited twelve month period from 1 January 2020 to 31 December 2020. These condensed consolidated financial statements do not include all the disclosures that would otherwise be required in a complete set of financial statements and should be read in conjunction with the 2020 annual report.
The condensed consolidated financial statements for the periods have been prepared in accordance with International Accounting Standard 34 “Interim Financial Reporting” and the accounting policies are consistent with those of the annual financial statements for the year ended 31 December 2020 and those envisaged for the financial statements for the year ending 31 December 2021.

Accounting standards, amendments and interpretations effective in 2021

The Group has not adopted any standards or interpretations in advance of the required implementation dates.

The following Accounting standards came into effect as of 1 January 2021

  Effective Date
Amendments to IFRS 9, IAS 39,IFRS 7, IFRS 4 and IFRS 16 Interest Rate benchmark Reform – Phase 2 1 January 2021


The adoption of this standard has had no effect on the financial results of the Group.


There are a number of standards, amendments to standards, and interpretations which have been issued that are effective in future periods and which the Group has chosen not to adopt early. None of these are expected to have a significant effect on the Group, in particular

  Effective Date
Property, Plant and Equipment – Proceeds before Intended Use (amendments to IAS 16) 1 January 2022
Onerous Contracts- Cost of Fulfilling a Contract (Amendments to IAS 37) 1 January 2022
Annual Improvements to IFRS Standards 2018-2020 1 January 2022
Reference to Conceptual Framework (Amendments to IFRS 3) 1 January 2022
IFRS 17 Insurance Contracts, including Amendments to IFRS 17 1 January 2023
Classification of Liabilities as Current or Non-current (Amendments to IAS 1) and Classification of Liabilities as Current or Non-current – Deferral of Effective Date 1 January 2023

These financial statements do not constitute statutory accounts as defined in Section 434 of the Companies Act 2006.

(i) Going concern

On 2 March 2021, the Group announced that it had concluded a placing of new shares raising gross proceeds of £12.5 million. The shares were issued and admitted to trading on AIM and listed on the TSX on 9 March 2021.

Following completion of the placing, the Group settled the remaining deferred consideration due to Equinox for the acquisition of Coringa amounting to US$2.5 million plus accrued interest of US$1.09 million. The Group also redeemed US$2.0 million of convertible loan stock held by Greenstone together with interest and other agreed fees totalling US$533,560. Following the settlement of these liabilities, the Group has no long-term borrowings or debt, and all security interests held by Equinox and Greenstone have been released.

The Group is using some of the proceeds from the balance of the funds raised through the placing of new shares to start the development of the mine at Coringa during 2021 and also to fund the Group’s exploration programme for 2021.

The Group expects that it will use a combination of debt finance and cash flow from its existing operations to meet the further development costs of Coringa until that project reaches a position of sustained positive cash-flow. The preliminary economic assessment issued by the Group in October 2019, estimated an initial capital requirement of US$24.7 million prior to sustained positive cash-flow. Management estimates that first gold production could occur 18 to 24 months after the commencement of initial mine development.

As with most businesses, the long term potential impacts of COVID-19 create uncertainty but management considers the actions and procedures that have been implemented by the Group and its history over the past 15 months of dealing with the effects of the pandemic, are minimising the potential for any significant and extended effect on the business and its operations. Management and the Board will continue to assess any further actions that may be necessary, but at this time, based on the information currently available and experiences to date, consider that the measures currently in place will permit the Group to maintain operations at forecast rates of production.

The Group did not claim or receive any COVID-19 related grants or other funding from any government or other sources, during 2020 or 2021 and has no expectation of receiving any such financial support in the future.

The Directors are confident as at the date of this report of being able to raise the necessary debt funding for the continued development of Coringa, as and when necessary. Whilst the Group’s operations are performing at the levels that they anticipate, the Directors acknowledge that unplanned interruptions or other events resulting in a reduction in gold production and/or any significant reduction of the gold price or appreciation of the Brazilian Real could adversely affect the level of free cash flow that the Group can generate on a monthly basis. The Group maintains stocks of spare parts, and the modular nature of the plant should permit gold production to continue in the event of breakdowns. The Group constantly monitors gold price and exchange rate and will use hedging facilities to protect its cash flow where appropriate. .Should it be required the Board could also reduce the planned level of exploration expenditure or reduce the planned rate of expenditure on the development of Coringa to reduce cash outflows.

On this basis, the Directors have therefore concluded that it is appropriate to prepare the financial statements on a going concern basis..

2.        Finance expense and income

  3 months ended

30 September 2021

3 months


30 September 2020

9 months ended

30 September 2021

9 months


30 September 2020

      US$ US$
Interest expense on secured loan (203,127)
Interest expense on convertible loan (64,292) (47,502)

Interest expense on mineral property acquisition liability (255,956) (23,854) (849,970)
Recognition of variation in effective interest rate of secured loan (79,800)
Loss in respect of non-substantial modification (155,237) (40,469)
Warrants Expense 18,140 (60,593)
Amortisation of arrangement fee for convertible loan (56,250) (150,000) (93,750)
Loss on revaluation of derivatives
Total finance expense 18,140 (376,498) (322,418) (1,308,463)
Gain in respect of non-substantial modification 40,469
Gain on revaluation of derivatives 16,547 12,356
Interest income 911
Total finance income 16,547 53,736
Net finance income/(expense) 18,140 (359,951) (322,418) (1,254,727)

3.         Taxation

The Group has recognised a deferred tax asset to the extent that the Group has reasonable certainty as to the level and timing of future profits that might be generated and against which the asset may be recovered. The Group has released the amount of US$1,149,614 as a deferred tax charge during the nine month period to 30 September 2021 (nine months to 30 September 2020 - US$794,044).

The Group has also incurred a tax charge on profits in Brazil for the nine month period of US$1,854,592 (nine months to 30 September 2020 - US$1,372,537).

4.        Earnings per Share

         3 months ended 30 September 2021
3 months ended 30 September 2020
9 months ended 30 September 2021
9 months ended 30 September 2020
Profit attributable to ordinary shareholders (US$) 1,308,948 3,779,901 7,661,601 7,419,295
Weighted average ordinary shares in issue 75,734,551 58,981,290 72,014,221 58,946,229
Basic profit per share (US cents) 1.73c 6.41c 10.64c 12.58c
Diluted ordinary shares in issue (1) 76,901,221 63,362,694 73,180,891 63,327,628
Diluted profit per share (US cents) 1.70 5.97c 10.47c 11.71c

1) Based on 1,166,670 options vested and exercisable as at 30 September 2021 (30 September 2020: 2,435,088 options and 2,036,316 shares that could be issued pursuant to any exercise of conversion rights attaching to the Convertible Loan Notes.

5.        Post balance sheet events

Subsequent to the end of the period, there has been no item, transaction or event of a material or unusual nature likely, in the opinion of the Directors of the Company to affect significantly the continuing operation of the entity, the results of these operations, or the state of affairs of the entity in future financial periods.


Qualified Persons Statement

The scientific and technical information contained within this announcement has been reviewed and approved by Michael Hodgson, a Director of the Company. Mr Hodgson is an Economic Geologist by training with over 26 years' experience in the mining industry. He holds a BSc (Hons) Geology, University of London, a MSc Mining Geology, University of Leicester and is a Fellow of the Institute of Materials, Minerals and Mining and a Chartered Engineer of the Engineering Council of UK, recognising him as both a Qualified Person for the purposes of Canadian National Instrument 43-101 and by the AIM Guidance Note on Mining and Oil & Gas Companies dated June 2009.


Assay Results

The assay results reported within this release include those provided by the Company's own on-site laboratory facilities at Palito which may not have been independently verified.  Serabi closely monitors the performance of its own facility against results from independent laboratory analysis for quality control purpose.  As a matter of normal practice the Company sends duplicate samples derived from a variety of the Company's activities to accredited laboratory facilities for independent verification. Based on the results of this work, the Company's management are satisfied that the Company's own facility shows good correlation with independent laboratory facilities. The Company would expect that in the preparation of any future independent Reserve/Resource statement undertaken in compliance with a recognised standard, the independent authors of such a statement would not use Palito assay results but only use assay results reported by an appropriately certificated laboratory.


Forward Looking Statements

Certain statements in this announcement are, or may be deemed to be, forward looking statements. Forward looking statements are identified by their use of terms and phrases such as ‘‘believe’’, ‘‘could’’, “should” ‘‘envisage’’, ‘‘estimate’’, ‘‘intend’’, ‘‘may’’, ‘‘plan’’, ‘‘will’’ or the negative of those, variations or comparable expressions, including references to assumptions. These forward looking statements are not based on historical facts but rather on the Directors’ current expectations and assumptions regarding the Company’s future growth, results of operations, performance, future capital and other expenditures (including the amount, nature and sources of funding thereof), competitive advantages, business prospects and opportunities. Such forward looking statements reflect the Directors’ current beliefs and assumptions and are based on information currently available to the Directors. A number of factors could cause actual results to differ materially from the results discussed in the forward looking statements including risks associated with vulnerability to general economic and business conditions, competition, environmental and other regulatory changes, actions by governmental authorities, the availability of capital markets, reliance on key personnel, uninsured and underinsured losses and other factors, many of which are beyond the control of the Company. Although any forward looking statements contained in this announcement are based upon what the Directors believe to be reasonable assumptions, the Company cannot assure investors that actual results will be consistent with such forward looking statements.



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