Cornish Metals Inc. (
TSX-V/AIM:
CUSN) (“Cornish Metals” or the “Company”), a mineral
exploration and development company focused on its projects in
Cornwall, United Kingdom, is pleased to announce that it has
released its unaudited financial statements and management,
discussion and analysis (“MD&A”) for the three months ended
April 30, 2022. The reports are available under the Company’s
profile on SEDAR (www.sedar.com) and on the Company’s website
(www.cornishmetals.com).
Highlights for the three months ended
April 30, 2022 and for the period ending June 22, 2022
(All figures expressed in Canadian dollars
unless otherwise stated)
- Completion of
10,159 meters of drilling within phased exploration program at the
United Downs exploration project with results from first 3,927
meters of drilling reported to date, with further assay results to
be reported when available;
- Completion of
financing for gross proceeds of £40.5 million ($64.8 million based
on closest available exchange rate) (the “Offering”), including a
strategic investment by Vision Blue Resources of £25.0 million
($40.0 million), to advance the South Crofty tin project (“South
Crofty”) to a potential construction decision (news releases dated
March 27, 2022 and May 23, 2022);
- Issuance of
second tranche of common shares pursuant to the restructuring of
the deferred consideration relating to the acquisition of the South
Crofty tin project and associated mineral rights (news release
dated May 29, 2022); and
- Mr. Tony Trahar
nominated by Vision Blue Resources as its representative on the
Board (news release dated June 5, 2022).
Richard Williams, CEO of Cornish Metals,
stated, “The completion of the £40m financing including a
strategic investment by Vision Blue Resources last month opened a
new chapter for the Company. As soon as the funds were received at
the end of May, we wasted no time in starting to place orders for
the new water treatment plant. The first recruits to our newly
formed projects team will be joining us in the coming weeks and
further appointments will be made to our mining and geological
teams to enhance their capacities.
The next few months will be hard but rewarding
work as we build the required framework for strong and capable
project execution. I look forward to reporting on progress at South
Crofty in due course.
In the meantime, the backdrop for tin pricing in
the medium to long term remains favourable. Demand is expected to
increase further as electrification gathers pace, with supply
constraints showing no sign of abating.”
Financial highlights for the three
months ended April 30, 2022 and April 30, 2021
|
Three months ended (unaudited) |
|
April 30, 2022 |
April 30, 2021 |
(Expressed in Canadian dollars) |
|
|
Total operating expenses |
627,115 |
894,549 |
Loss for the period |
979,427 |
1,301,049 |
Net cash (used in) operating activities |
(625,384) |
(908,981) |
Net cash (used in) investing activities |
(1,184,673) |
(762,856) |
Net cash (used in) / provided by financing activities |
(555,449) |
13,226,816 |
Cash at end of the period |
4,286,535 |
11,511,900 |
-
Decrease in operating expenses impacted by $368,325 of costs
relating to AIM listing incurred in comparative period which were
not eligible for capitalization;
- Higher operating
expenses more generally relating to increased media/investor
activities following last year’s AIM listing and preparatory work
for the successful fundraise cornerstoned by Vision Blue
Resources;
- Costs of
$576,786 and $230,723 capitalized in connection with the ongoing
exploration program at United Downs and Carn Brea, respectively
(excluding capitalized depreciation and other non-cash items);
- Financing fees
of $584,359 incurred by April 30, 2022 in connection with the
fundraise which closed at the end of May 2022;
- Gross proceeds
raised from the Offering of £40.5 million ($64.8 million) received
subsequent to the period end, following gross proceeds raised from
the AIM listing in comparative period of £8.2 million ($14.4
million) (news release dated February 16, 2021); and
- Recognition of
foreign currency translation loss of $1,152,758 for those assets
located in the UK when translated into Canadian dollars for
presentational purposes.
Outlook
The proceeds raised from the Offering completed
in May 2022 are being used to advance the South Crofty tin project
to a potential construction decision within 30 months from closing
of the Offering. The planned use of the proceeds from the Offering
is to complete the dewatering program and Feasibility Study at
South Crofty, evaluate downstream beneficiation opportunities and
commence potential on-site early works in advance of a potential
construction decision.
Within 30 months from the closing of the
Offering, the Company’s plans are as follows:
- Construct the
Water Treatment Plant (“WTP”) in the first half of 2023 and
thereafter complete the dewatering of the mine within 18
months;
- Complete an
underground drill program which is expected to commence in July
2022 in order to delineate a JORC compliant Measured and Indicated
Mineral Resource and increase the Indicated and Inferred JORC
Mineral Resource once access to the underground workings is
obtained;
- Complete a
Feasibility Study using all reasonable commercial efforts on or
before 31 December 2024;
- Commence basic
and detailed engineering studies, construction of the processing
plant, refurbishment of underground facilities and other on-site
early works; and
- Evaluate
downstream beneficiation opportunities in the UK and the rest of
Europe.
Subject to the availability of financing,
consideration will also be given to continuing with the Company’s
exploration program at United Downs and evaluating other
near-surface, high potential, exploration targets within transport
distance of the planned processing plant site at South Crofty.
ABOUT CORNISH METALS
Cornish Metals completed the acquisition of the
South Crofty tin and United Downs copper / tin projects, plus
additional mineral rights located in Cornwall, UK, in July 2016
(see Company news release dated July 12, 2016). The additional
mineral rights cover an area of approximately 15,000 hectares and
are distributed throughout Cornwall. Some of these mineral rights
cover old mines that were historically worked for copper, tin,
zinc, and tungsten.
TECHNICAL INFORMATION
The technical information in this news release
has been compiled by Mr. Owen Mihalop. Mr. Mihalop has reviewed and
takes responsibility for the data and geological interpretation.
Mr. Owen Mihalop (MCSM, BSc (Hons), MSc, FGS, MIMMM, CEng) is Chief
Operating Officer for Cornish Metals Inc. and has sufficient
experience relevant to the style of mineralisation and type of
deposit under consideration and to the activity which he is
undertaking to qualify as a Competent Person as defined under the
JORC Code (2012) and as a Qualified Person under NI 43-101. Mr.
Mihalop consents to the inclusion in this announcement of the
matters based on his information in the form and context in which
it appears.
For additional information please contact:
In North America:
Irene Dorsman at (604) 200 6664 or by e-mail at
irene@cornishmetals.com
In the UK: |
|
|
|
|
|
SP Angel Corporate Finance LLP (Nominated Adviser & Joint
Broker) |
Tel: |
+44 203 470 0470 |
|
Richard Morrison |
|
|
Charlie Bouverat |
|
|
Grant Barker |
|
|
|
|
Hannam & Partners(Joint
Broker) |
Tel: |
+44 207 907 8500 |
|
Matthew Hasson |
|
|
Andrew Chubb |
|
|
Ernest Bell |
|
|
|
|
BlytheRay (Financial PR/IR-London) |
Tel: |
+44 207 138 3204 |
|
Tim Blythe |
tim.blythe@blytheray.com |
|
Megan Ray |
megan.ray@blytheray.com |
ON BEHALF OF THE BOARD OF
DIRECTORS
“Richard D. Williams”Richard D. Williams,
P.Geo
Neither the TSX Venture Exchange nor its
Regulation Services Provider (as that term is defined in the
policies of the TSX Venture Exchange) accepts responsibility for
the adequacy or accuracy of this release.
Caution regarding forward looking
statements
This news release contains "forward-looking
statements" including, but not limited to, statements in connection
with the expected use of proceeds of the Offering, including in
respect of certain work programs, expected construction, including
in respect of the WTP, and the potential completion of a
Feasibility Study on the South Crofty mine and the timing thereof,
the exploration program at United Downs and other exploration
opportunities surrounding the South Crofty tin project, expected
recruitment of various personnel, and expectations respecting tin
pricing and other economic factors. Forward-looking statements,
while based on management’s best estimates and assumptions at the
time such statements are made, are subject to risks and
uncertainties that may cause actual results to be materially
different from those expressed or implied by such forward-looking
statements, including but not limited to: risks related to receipt
of regulatory approvals, risks related to general economic and
market conditions; risks related to the COVID-19 global pandemic
and any variants of COVID-19 which may arise; risks related to the
availability of financing when required and on terms acceptable to
the Company and the potential consequences if the Company fails to
obtain any such financing, such as a potential disruption of the
Company’s exploration program(s); the timing and content of
upcoming work programs; actual results of proposed exploration
activities; possible variations in Mineral Resources or grade;
failure of plant, equipment or processes to operate as anticipated;
accidents, labour disputes, title disputes, claims and limitations
on insurance coverage and other risks of the mining industry;
changes in national and local government regulation of mining
operations, tax rules and regulations.
Although Cornish Metals has attempted to
identify important factors that could cause actual results to
differ materially from those contained in forward-looking
statements, there may be other factors that cause results not to be
as anticipated, estimated or intended. There can be no assurance
that such statements will prove to be accurate, as actual results
and future events could differ materially from those anticipated in
such statements. Accordingly, readers should not place undue
reliance on forward-looking statements. Cornish Metals undertakes
no obligation or responsibility to update forward-looking
statements, except as required by law.
Market Abuse Regulation (MAR)
Disclosure
The information contained within this
announcement is deemed by the Company to constitute inside
information pursuant to Article 7 of EU Regulation 596/2014 as it
forms part of UK domestic law by virtue of the European Union
(Withdrawal) Act 2018 as amended.
CONSOLIDATED CONDENSED INTERIM
STATEMENTS OF FINANCIAL POSITION
(Unaudited)(Expressed in Canadian dollars)
|
April 30, 2022 |
|
|
January 31, 2022 |
|
|
|
|
|
|
|
ASSETS |
|
|
|
|
|
Current |
|
|
|
|
|
Cash |
$ |
4,286,535 |
|
|
$ |
6,922,704 |
|
Marketable securities |
|
1,574,506 |
|
|
|
1,574,506 |
|
Receivables |
|
140,449 |
|
|
|
107,230 |
|
Deferred financing fees |
|
672,778 |
|
|
|
- |
|
Prepaid expenses |
|
353,680 |
|
|
|
231,933 |
|
|
|
7,027,948 |
|
|
|
8,836,373 |
|
|
|
|
|
|
|
Deposits |
|
52,959 |
|
|
|
42,448 |
|
Property, plant and
equipment |
|
6,128,901 |
|
|
|
6,437,175 |
|
Exploration and
evaluation assets |
|
21,175,960 |
|
|
|
20,772,029 |
|
|
|
|
|
|
|
|
$ |
34,385,768 |
|
|
$ |
36,088,025 |
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
Current |
|
|
|
|
|
Accounts payable and accrued liabilities |
$ |
929,675 |
|
|
$ |
613,178 |
|
Lease liability |
|
3,594 |
|
|
|
4,204 |
|
Commitment to issue shares |
|
6,076,200 |
|
|
|
6,041,525 |
|
|
|
7,009,469 |
|
|
|
6,658,907 |
|
Lease
liability |
|
- |
|
|
|
667 |
|
NSR
liability |
|
8,767,363 |
|
|
|
8,717,330 |
|
|
|
15,776,832 |
|
|
|
15,376,904 |
|
|
|
|
|
|
|
SHAREHOLDERS’
EQUITY |
|
|
|
|
|
Capital stock |
|
56,846,350 |
|
|
|
56,846,350 |
|
Share subscriptions received in advance |
|
30,000 |
|
|
|
- |
|
Capital contribution |
|
2,007,665 |
|
|
|
2,007,665 |
|
Share-based payment reserve |
|
630,265 |
|
|
|
630,265 |
|
Foreign currency translation reserve |
|
(1,326,881 |
) |
|
|
(174,123 |
) |
Deficit |
|
(39,578,463 |
) |
|
|
(38,599,036 |
) |
|
|
|
|
|
|
|
|
18,608,936 |
|
|
|
20,711,121 |
|
|
|
|
|
|
|
|
$ |
34,385,768 |
|
|
$ |
36,088,025 |
|
CONSOLIDATED CONDENSED INTERIM STATEMENTS OF LOSS AND
COMPREHENSIVE LOSS
(Unaudited) (Expressed in Canadian dollars)
|
Three months ended |
|
|
April 30, 2022 |
|
|
April 30, 2021 |
|
|
|
|
|
|
|
|
|
EXPENSES |
|
|
|
|
|
|
|
Accretion |
$ |
- |
|
|
$ |
15,764 |
|
Advertising and promotion |
|
110,878 |
|
|
|
52,925 |
|
Depreciation |
|
443 |
|
|
|
22,109 |
|
Finance cost |
|
- |
|
|
|
3,895 |
|
Insurance |
|
33,509 |
|
|
|
21,784 |
|
Office, miscellaneous and rent |
|
28,978 |
|
|
|
21,883 |
|
Professional fees |
|
169,597 |
|
|
|
412,674 |
|
Generative exploration costs |
|
333 |
|
|
|
- |
|
Regulatory and filing fees |
|
21,244 |
|
|
|
68,883 |
|
Share-based compensation |
|
- |
|
|
|
51,796 |
|
Salaries, directors’ fees and benefits |
|
262,133 |
|
|
|
222,836 |
|
|
|
|
|
|
|
|
|
Total operating expenses |
|
(627,115 |
) |
|
|
(894,549 |
) |
|
|
|
|
|
|
|
|
Interest income |
|
743 |
|
|
|
192 |
|
Foreign exchange loss |
|
(353,055 |
) |
|
|
(406,692 |
) |
|
|
|
|
|
|
|
|
Loss for the period |
|
(979,427 |
) |
|
|
(1,301,049 |
) |
|
|
|
|
|
|
|
|
Foreign currency translation |
|
(1,152,758 |
) |
|
|
(210,502 |
) |
Total comprehensive loss for the period |
$ |
(2,132,185 |
) |
|
$ |
(1,511,551 |
) |
|
|
|
|
|
|
|
|
Basic and diluted loss per share |
$ |
(0.01 |
) |
|
$ |
(0.01 |
) |
|
|
|
|
|
|
|
|
Weighted average number of common shares
outstanding: |
|
285,850,157 |
|
|
|
248,501,072 |
|
CONSOLIDATED CONDENSED INTERIM
STATEMENTS OF CASH
FLOWS
(Unaudited) (Expressed in Canadian dollars)
|
For the three months ended |
|
April 30, 2022 |
April 30, 2021 |
|
|
|
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
Loss for the period |
$ |
(979,427 |
) |
|
$ |
(1,301,049 |
) |
Items not involving cash: |
|
|
Accretion |
|
- |
|
|
|
15,764 |
|
Depreciation |
|
443 |
|
|
|
22,109 |
|
Share-based compensation |
|
- |
|
|
|
51,796 |
|
Finance cost |
|
- |
|
|
|
3,895 |
|
Foreign exchange loss |
|
353,055 |
|
|
|
406,692 |
|
|
|
|
Changes in non-cash working capital items: |
|
|
Increase in receivables |
|
(33,218 |
) |
|
|
(47,393 |
) |
Increase in prepaid expenses |
|
(28,727 |
) |
|
|
(54,245 |
) |
Increase (decrease) in accounts payable and accrued
liabilities |
|
62,490 |
|
|
|
(6,550 |
) |
|
|
|
Net cash used in operating activities |
|
(625,384 |
) |
|
|
(908,981 |
) |
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES |
|
|
Acquisition of property, plant and equipment |
(2,661 |
) |
|
(75,671 |
) |
Acquisition of exploration and evaluation assets |
(1,171,500 |
) |
|
(670,970 |
) |
Increase in deposits |
(10,512 |
) |
|
(16,215 |
) |
|
|
|
Net cash used in investing activities |
|
(1,184,673 |
) |
|
|
(762,856 |
) |
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES |
|
|
Proceeds from AIM listing |
|
- |
|
|
|
14,244,206 |
|
Proceeds from fundraising received in advance of share issue |
|
30,000 |
|
|
|
- |
|
Proceeds from warrant exercises |
|
- |
|
|
|
184,750 |
|
Share issue costs |
|
- |
|
|
|
(1,066,126 |
) |
Increase in deferred financing fees |
|
(584,359 |
) |
|
|
- |
|
Conversion of royalty option costs |
|
- |
|
|
|
(111,730 |
) |
Lease payments |
|
(1,090 |
) |
|
|
(24,284 |
) |
|
|
|
Net cash provided by (used in) financing activities |
|
(555,449 |
) |
|
|
13,226,816 |
|
|
|
|
Impact of foreign exchange on cash |
|
(270,663 |
) |
|
|
(396,680 |
) |
|
|
|
Change in cash during the period |
|
(2,636,169 |
) |
|
|
11,158,299 |
|
Cash, beginning of the period |
|
6,922,704 |
|
|
|
353,601 |
|
|
|
|
Cash, end of the period |
$ |
4,286,535 |
|
|
$ |
11,511,900 |
|
CONSOLIDATED CONDENSED INTERIM
STATEMENTS OF CHANGES IN SHAREHOLDERS’
EQUITY
(Unaudited) (Expressed in Canadian dollars)
|
Number of shares |
Amount |
|
Share subscriptions received in advance |
|
Capital contribution |
Share-based payment reserve |
Foreign currency
translationreserve |
|
Deficit |
|
Total |
|
Balance at January 31, 2021 |
149,918,585 |
$ |
40,737,065 |
|
$ |
189,902 |
|
$ |
2,007,665 |
$ |
846,212 |
$ |
239,028 |
|
$ |
(35,687,896 |
) |
$ |
8,331,976 |
|
Share issuance pursuant to AIM listing |
117,226,572 |
|
14,434,108 |
|
|
(189,902 |
) |
|
- |
|
- |
|
- |
|
|
- |
|
|
14,244,206 |
|
Share issue costs |
- |
|
(1,506,824 |
) |
|
- |
|
|
- |
|
- |
|
- |
|
|
- |
|
|
(1,506,824 |
) |
Warrant exercises |
2,275,000 |
|
184,750 |
|
|
- |
|
|
- |
|
- |
|
- |
|
|
- |
|
|
184,750 |
|
Share-based compensation |
- |
|
- |
|
|
- |
|
|
- |
|
51,796 |
|
- |
|
|
- |
|
|
51,796 |
|
Foreign currency translation |
- |
|
- |
|
|
- |
|
|
- |
|
- |
|
(210,502 |
) |
|
- |
|
|
(210,502 |
) |
Loss for the period |
- |
|
- |
|
|
- |
|
|
- |
|
- |
|
- |
|
|
(1,301,049 |
) |
|
(1,301,049 |
) |
Balance at April 30, 2021 |
269,420,157 |
$ |
53,849,099 |
|
$ |
- |
|
$ |
2,007,665 |
$ |
898,008 |
$ |
28,526 |
|
$ |
(36,988,945 |
) |
$ |
19,794,353 |
|
|
|
|
|
|
|
|
|
|
Balance at January 31, 2022 |
285,850,157 |
$ |
56,846,350 |
|
$ |
- |
|
$ |
2,007,665 |
$ |
630,265 |
$ |
(174,123 |
) |
$ |
(38,599,036 |
) |
$ |
20,711,121 |
|
Commitment to issue shares pursuant to the Offering |
- |
|
- |
|
|
30,000 |
|
|
- |
|
- |
|
- |
|
|
- |
|
|
30,000 |
|
Foreign currency translation |
- |
|
- |
|
|
- |
|
|
- |
|
- |
|
(1,152,758 |
) |
|
- |
|
|
(1,152,758 |
) |
Loss for the period |
- |
|
- |
|
|
- |
|
|
- |
|
- |
|
- |
|
|
(979,427 |
) |
|
(979,427 |
) |
Balance at April 30, 2022 |
285,850,157 |
$ |
56,846,350 |
|
$ |
30,000 |
|
$ |
2,007,665 |
$ |
630,265 |
$ |
(1,326,881 |
) |
$ |
(39,578,463 |
) |
$ |
18,608,936 |
|
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