TIDMALS

RNS Number : 1630S

Altus Strategies PLC

12 November 2021

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

12 November 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 and Analysis for the three-month and nine-month periods ending 30 September 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 September 2021 are as follows:

Corporate highlights:

-- Acquisition of an effective 0.418% net smelter return ("NSR") royalty on the 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 (projection assumes copper price of US$4.00 per pound and production in line with modelled mine plans which means actual results may vary and remain subject, among other factors, to the copper price remaining stable and the mine achieving the modelled operating performance during the period - see "Forward Looking Information" in Management's Discussion and Analysis)

-- Caserones royalty acquired via a strategic 50:50 partnership with TSX Venture and NYSE American listed EMX Royalty Corp via a Chilean special purpose vehicle holding a combined effective 0.836% NSR interest on Caserones

-- US$29 million strategic acquisition loan facility provided by the Company's largest shareholder La Mancha Fund SCSp ("La Mancha")

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

Operational highlights:

-- Western Mali: Initial results from reverse circulation ("RC") drilling at the Company's 100% owned Diba gold deposit, including 8.50 grams per tonne ("g/t") gold ("Au") over 24m from 20m and 2.54 g/t Au over 30m from 36m (results are down-the-hole and not true widths)

-- Southern Mali: Significant increase in joint venture ("JV") landholding at Tabakorole (by 100km(2) to 292km(2) ) with Australian Securities Exchange listed Marvel Gold Limited ("Marvel Gold")

-- Southern Mali: Encouraging diamond drilling ("DD") results from first 19 drill holes at Tabakorole and discovery of significant new parallel zone of mineralisation

-- Egypt: Discovery of numerous hard rock artisanal gold workings from field reconnaissance at Gabal Om Ourada and Wadi Dubur projects

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

-- Morocco: Grant of four new exploration licences totalling 148.5km(2) , targeting copper and silver

Financial highlights:

   --    Cash balance of GBP5.9 million / C$10.2 million as at 30 September 2021 

-- Cash outflow for operating activities of GBP3.1 million / C$5.2 million for nine months ending 30 September 2021

   --    Listed equity holdings of GBP1.6 million / C$2.7 million as at 30 September 2021 

Post period:

-- Receipt of maiden royalty income of US$1.34 million in respect of the Company's NSR royalty on the Caserones copper mine in northern Chile (before local Chilean and UK taxes)

-- Upgraded Mineral Resource Estimate ("MRE") prepared for Tabakorole gold project in Southern Mali, resulting in a 24% increase in indicated ounces and a 7% increase in inferred ounces, with 70% of the deposit subject to the MRE within 150m of the surface

-- High grade intersections including 21.9 g/t Au over 10.2m from 28m from DD at Diba gold deposit in western Mali (results are down-the-hole and not true widths)

Steven Poulton, Chief Executive of Altus, commented:

"I am delighted to report on a significant and highly productive quarter for the Company, marked in particular by the closing of the US$34.1 million landmark acquisition of the cash-paying Caserones copper royalty in Chile. The acquisition, which has transitioned Altus into a revenue generating business, is a testament to the Company's strategic vision and effective growth strategy. Altus has also continued to deliver excellent results on its work programmes across its portfolio of projects, including drilling in Mali and field exploration programmes in Egypt and Morocco.

"The acquisition of the NSR royalty on the Caserones copper mine not only marked a major milestone in the development of the Company's royalty strategy, but also further diversifies the Company's portfolio outside of Africa and towards copper. The first cash instalment from Caserones was received shortly after the end of the quarter. Our largest shareholder, La Mancha, assisted Altus with the acquisition by providing a US$29 million strategic acquisition facility, underscoring their commitment to the long-term growth of Altus as well as the quality of the acquisition.

"Significant progress has been made at the Diba gold project in western Mali during the period, with initial results from reverse circulation drilling, including 8.50 g/t Au over 24m from 20m and 2.54 g/t Au over 30m from 36m. The Air Core and RC drilling programmes, which were paused due to the rainy season, recommenced after the period end and were augmented to include 1,300m of diamond drilling. A key objective in the next quarter will be to complete the drilling programmes at Diba with an updated independent MRE and Preliminary Economic Assessment on the project to follow.

"Altus' JV partner, Marvel Gold, has continued to advance the Tabakorole gold JV project in southern Mali during the period, through a combination of RC and DD programmes, targeting both infill of and extensions to the existing deposit. Results included 2.4 g/t Au over 24m from 35m in the parallel zone and 3.6 g/t Au over 16.5m from 3.2m in the northwest zone. Shortly after the period, Marvel announced an updated MRE for Tabakorole, comprising 17,300,000 tonnes at 1.2 g/t Au for 665,000 ounces in the Inferred category and 9,200,000 tonnes at 1.2 g/t Au for 360,000 ounces in the Indicated category - See Altus' news release "Gold Resource Exceeds One Million Ounces at Tabakorole in Southern Mali" dated 05 October 2021. The updated MRE represented a 24% increase in indicated ounces and a 7% increase in inferred ounces. Approximately 70% of the MRE is situated within 150m of the surface. The deposit remains open in parallel zones and at depth.

"In Egypt, Altus is delighted to have welcomed Mark Campbell to the team as General Manager of the Company's Egyptian branch and we have expanded our in-country geological and administrative teams. Initial reconnaissance was also completed on Gabal Om Ourada and Wadi Dubur in the Eastern Desert with numerous hard rock artisanal gold workings discovered and, after the period end, reconnaissance commenced at the Gabal Al-Shaluhl and Wadi Jundi licences.

"In Morocco, a high resolution, induced polarisation survey commenced at the Agdz copper-silver project. The results will be used to define and prioritise targets for trenching and drilling across four key prospects discovered to date at Agdz. In July, four further projects, totalling 148.5km(2) , were granted to the Company 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 800km(2) . The Company is actively examining potential transactions with third parties on its portfolio of Moroccan assets that are held by its 100% owned subsidiary Aterian Resources Ltd.

"We look forward with confidence to another exciting quarter ahead for Altus. Alongside assessing further accretive royalty acquisition and other strategic opportunities, our focus during the quarter will be progressing our gold programmes in Mali and Egypt, as well as continuing to create value from our portfolio of projects in Morocco. I look forward to keeping shareholders updated on our progress."

INTERIM UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND NINE MONTHSED 30 SEPTEMBER 2021

CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE LOSS

 
                                               For the three months         For the nine months 
                                                 ended 30 September                ended 
                                                                                30 September 
                                                     2021        2020           2021          2020 
                                   Notes              GBP         GBP            GBP           GBP 
------------------------------  -----------  ------------  ----------   ------------  ------------ 
 Continuing operations 
 Revenue and costs recovered 
  from 
  joint venture partners                 2         29,905      79,310         52,509       255,984 
 Exploration costs expensed              3      (717,308)   (293,145)    (2,063,096)     (882,128) 
 Administrative expenses                 4      (331,079)   (225,776)      (803,893)     (530,289) 
 Listing and acquisition 
  related costs                          6      (167,842)    (14,507)      (175,335)      (61,372) 
 impairment of intangible 
  asset                                  5      (519,777)           -      (519,777)       (3,798) 
 Foreign exchange gains/(losses)                (349,970)   (153,534)      (360,302)      (98,210) 
 Share based payments                           (243,349)    (53,225)      (857,865)      (73,227) 
                                             ------------  ----------   ------------  ------------ 
 Profit/(loss) from operations                (2,299,420)   (660,877)    (4,727,759)   (1,393,040) 
 
 Interest receivable                                    -           -             60         1,614 
 Interest payable                               (253,996)     (1,537)      (256,447)       (5,202) 
 Other income/(costs)                                  57         249             57     1,109,250 
 Fair value gain/(loss) on 
  investments                                   (468,077)   (299,094)      (373,232)       132,047 
 Share of profit of investments 
  accounted for using the 
  equity method                          7        653,610           -        653,610             - 
                                             ------------  ----------   ------------  ------------ 
 Profit/(loss) before taxation                (2,367,826)   (961,259)    (4,703,711)     (155,331) 
 Taxation                                               -      71,209              -             - 
                                             ------------  ----------   ------------  ------------ 
 Profit/(loss) for the year                   (2,367,826)   (890,050)    (4,703,711)     (155,331) 
                                             ============  ==========   ============  ============ 
 
 Other comprehensive income 
 Items that may be reclassified 
  to the income statement 
  in subsequent periods 
 Foreign currency translation 
  differences                                      29,818           -         29,818             - 
                                             ------------  ----------   ------------  ------------ 
 Total comprehensive 
  (expense)/income for the 
  year                                        (2,338,008)   (890,050)    (4,673,893)     (155,331) 
                                             ============  ==========   ============  ============ 
 
 Profit/(loss) for the quarter 
  attributable to: 
     - Owners of the parent 
      company                                 (2,336,827)   (891,023)    (4,700,765)     (155,852) 
     - Non-controlling interest                     (999)         973        (2,946)           521 
                                             ------------  ----------   ------------  ------------ 
                                              (2,367,826)   (890,050)    (4,703,711)     (155,331) 
                                             ------------  ----------   ------------  ------------ 
 Total comprehensive profit/(loss) 
  for the quarter attributable 
  to: 
     - Owners of the parent 
      company                                 (2,337,010)   (891,023)    (4,670,947)     (155,852) 
     - Non-controlling interest                     (999)         973        (2,946)           521 
                                             ------------  ----------   ------------  ------------ 
                                              (2,338,008)   (890,050)    (4,673,893)     (155,331) 
                                             ------------  ----------   ------------  ------------ 
 
 Basic earnings per share 
  (pence) attributable to 
  the owners of the parent               14        (2.91)      (1.27)         (6.05)        (0.24) 
 Diluted earnings per share 
  (pence) attributable to 
  the owners of the parent               14        (2.91)      (1.27)         (6.05)        (0.24) 
--------------------------------------  ---  ------------  ----------   ------------  ------------ 
 
 

INTERIM UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND NINE MONTHSED 30 SEPTEMBER 2021

CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION

 
                                          As at 30 September   As at 31 December 
                                                        2021                2020 
                                  Notes                  GBP                 GBP 
-------------------------------  ------  -------------------  ------------------ 
 Non-current assets 
 Intangible assets                  5              3,169,722           3,277,381 
 Property, plant and equipment                        25,179               4,720 
 Leased assets                                        45,150              60,198 
 Investment in associate            7             24,959,232                   - 
 Investments                        8              1,561,431           1,320,542 
                                         -------------------  ------------------ 
                                                  29,760,714           4,662,841 
 Current assets 
 Trade and other receivables        9                315,283             853,629 
 Held-for-sale assets                                 86,462              86,765 
 Cash and cash equivalents                         6,486,641           5,937,486 
                                         -------------------  ------------------ 
                                                   6,888,386           6,877,880 
                                         -------------------  ------------------ 
 Total assets                                     36,649,100          11,540,721 
 
 Current liabilities 
 Trade and other payables          10           (22,537,212)         (1,144,754) 
 Held-for-sale liabilities                          (34,020)            (34,020) 
 Provisions                                         (15,000)            (15,000) 
                                         -------------------  ------------------ 
                                                (22,586,232)         (1,193,774) 
 Non-current liabilities 
 Trade and other payables                           (29,458)            (45,848) 
                                         -------------------  ------------------ 
 Total liabilities                              (22,615,690)         (1,239,622) 
 
 Net assets                                       14,033,410          10,301,099 
                                         ===================  ================== 
 
 Equity 
 Share capital                     11              4,019,576           3,504,580 
 Share premium                     11             20,255,458          13,222,115 
 Translation reserve                                (52,761)            (82,579) 
 Other reserves                                    7,216,878           6,359,013 
 Retained earnings                              (17,301,514)        (12,600,749) 
 
 Total equity attributable to 
  owners of the parent                            14,137,637          10,402,380 
 Non-controlling interest                          (104,227)           (101,281) 
 Total equity                                     14,033,410          10,301,099 
-------------------------------  ------  -------------------  ------------------ 
 

INTERIM UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND SIX MONTHSED 30 SEPTEMBER 2021

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY

 
                                      Share 
                         Share      premium   Translation       Other       Retained         Total   Non-controlling 
                       capital      account       reserve    reserves       earnings        equity          interest         Total 
 Nine months ended 
 30 September 
 2020                      GBP          GBP           GBP         GBP            GBP           GBP               GBP           GBP 
------------------  ----------  -----------  ------------  ----------  -------------  ------------  ----------------  ------------ 
 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) for 
  the period                 -            -             -           -      (155,852)     (155,852)               521     (155,331) 
 Other 
 comprehensive 
 income 
 Foreign currency 
 translation 
 differences                 -            -             -           -              -             -                 -             - 
                    ----------  -----------  ------------  ----------  -------------  ------------  ----------------  ------------ 
 Total 
  comprehensive 
  income/(expense)           -            -             -           -      (155,852)     (155,852)               521     (155,331) 
                    ----------  -----------  ------------  ----------  -------------  ------------  ----------------  ------------ 
 Issue of shares     1,402,296    5,803,746             -           -              -     7,206,042                 -     7,206,042 
 Share based 
  payment charge             -            -             -      53,225              -        53,225                 -        53,225 
                    ----------  -----------  ------------  ----------  -------------  ------------  ----------------  ------------ 
 Total 
  transactions 
  with owners, 
  recognised 
  directly in 
  equity             1,402,296    5,803,746             -      53,225      (155,852)     7,103,415               521     7,103,936 
                    ----------  -----------  ------------  ----------  -------------  ------------  ----------------  ------------ 
 Balance at 30 
  September 2020     3,504,580   13,182,115      (82,579)   5,808,295   (10,680,166)    11,732,245          (97,806)    11,634,439 
                    ==========  ===========  ============  ==========  =============  ============  ================  ============ 
 
 Nine months ended 
 30 September 
 2021 
------------------  ----------  -----------  ------------  ----------  -------------  ------------  ----------------  ------------ 
 Balance 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) for 
  the period                 -            -             -           -    (4,700,765)   (4,700,765)           (2,946)   (4,703,711) 
 Other 
 comprehensive 
 income 
 Foreign currency 
  translation 
  differences                -            -        29,818           -              -        29,818                 -        29,818 
                    ----------  -----------  ------------  ----------  -------------  ------------  ----------------  ------------ 
 Total 
  comprehensive 
  income/(expense)           -            -        29,818           -    (4,700,765)   (4,670,947)           (2,946)   (4,673,893) 
                    ----------  -----------  ------------  ----------  -------------  ------------  ----------------  ------------ 
 Issue of shares       513,333    7,013,435             -           -              -     7,526,768                 -     7,526,768 
 Exercise of 
  warrants               1,663       19,908             -           -              -        21,571                 -        21,571 
 Share based 
  payment charge             -            -             -     857,865              -       857,865                 -       857,865 
 Total 
  transactions 
  with owners, 
  recognised 
  directly in 
  equity               514,996    7,033,343             -     857,865              -     8,406,204           (2,946)     4,297,213 
                    ----------  -----------  ------------  ----------  -------------  ------------  ----------------  ------------ 
 Balance at 30 
  September 2021     4,019,576   20,255,458      (52,761)   7,216,878   (17,301,514)    14,137,637         (104,227)    14,033,410 
                    ==========  ===========  ============  ==========  =============  ============  ================  ============ 
 

INTERIM UNAUDITED FINANCIAL STATEMENTS

FOR THE THREE AND NINE MONTHSED 30 SEPTEMBER 2021

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS

 
 Period ended 30 September                      Three months                Nine months 
                                                  2021        2020           2021          2020 
                                                   GBP         GBP            GBP           GBP 
---------------------------------------  -------------  ----------  -------------  ------------ 
 Cash flows from operating activities 
 Profit/(loss) for the period 
  after taxation                           (2,338,008)   (890,050)    (4,673,893)     (155,331) 
 Adjustments for: 
 Net interest (received)/paid                  253,996        (77)        256,387         3,588 
 Share based payments                          243,349      53,225        857,865        73,227 
 Impairment of non-current assets              519,777           -        519,777         3,798 
 Bad debt provision                                  -           -       (10,875)             - 
 Depreciation of property, plant 
  and equipment                                  6,822       5,679         19,303        18,148 
 Receipt of shares in investee                       -       1,614              -   (1,108,999) 
 Fair value (gain)/loss on investments         472,363     322,493        376,689     (134,899) 
 Share of profit of associate                (653,610)           -      (653,610)             - 
 Revaluation of associate                      508,093           -        508,093             - 
 Other gains/(losses)                                -    (71,581)              -      (21,754) 
 Movements in working capital: 
 (Increase)/decrease in trade 
  and other receivables                        (4,967)   (117,100)       (68,054)      (32,911) 
 Increase/(decrease) in trade 
  and other payables                           695,655         984        325,447     (476,619) 
                                         -------------  ----------  -------------  ------------ 
 Cash flows used in operating 
  activities                                 (296,530)   (694,813)    (2,542,871)   (1,831,752) 
 
 Investing activities 
 Purchase of intangible assets                       -    (15,801)      (412,118)      (76,102) 
 Purchase of property plant 
  and equipment                               (18,524)           -       (24,714)       (4,027) 
 Investment in associate                   (6,203,429)           -    (6,203,429)             - 
 Loan granted to associate                (18,610,286)           -   (18,610,286)             - 
 Net interest received/(paid)                (256,447)          77      (256,387)       (1,838) 
                                         -------------  ----------  -------------  ------------ 
 Net cash used in investing 
  activities                              (25,088,686)    (15,724)   (25,506,934)      (81,967) 
 
 Financing activities 
 Proceeds from issue of shares                       -           -      7,548,338     6,483,561 
 Loan granted by related party              21,068,997           -     21,068,997             - 
 Principal element of lease 
  payments                                     (5,425)     (4,607)       (15,224)      (13,473) 
 Interest element of lease payments              (700)     (1,518)        (3,151)       (4,902) 
                                         -------------  ----------  -------------  ------------ 
 Net cash generated from financing 
  activities                                21,062,872     (6,125)     28,598,960     6,465,186 
 
 Net increase/decrease in cash 
  and cash equivalents                     (4,322,344)   (716,662)        549,155     4,551,467 
---------------------------------------  -------------  ----------  -------------  ------------ 
 Cash and cash equivalents at 
  beginning of the period                   10,808,985   7,480,771      5,937,486     2,212,642 
 Cash and cash equivalents at 
  the end of the period                      6,486,641   6,764,109      6,486,641     6,764,109 
---------------------------------------  -------------  ----------  -------------  ------------ 
 

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                  Tel: +44 (0) 1235 511 767 
 Steven Poulton, Chief Executive       E-mail: info@altus-strategies.com 
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)  Tel: +44 (0) 20 3004 9512 
 Charles Goodwin / Henry Wilkinson     E-mail: altus@yellowjerseypr.com 
 

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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