25 July
2024
Centamin plc
("Centamin" or "the Company" of
"the Group")
LSE: CEY / TSX: CEE
INTERIM report
for the six months ended 30 June
2024 ("H1 2024")
MARTIN HORGAN, CEO, commented: "Our focus on operating
performance has enabled us to take advantage of stronger gold
prices to deliver improved EBITDA and a significant increase in
free cash flow. Looking ahead to H2 2024,
the commencement of the grid connection project will build on our
recent success in taking costs out of the business, with
commissioning due in H1 2025.
At the same time, we are advancing the organic growth
opportunities within our portfolio. The completion of the DFS at
Doropo shows a very robust project; we are now well positioned to
apply for a mining licence which we expect should be granted by the
end of 2024, ahead of a final investment decision. Meanwhile, we
are aggressively following up on the recent success at our Eastern
Desert Exploration ("EDX") project with the continued drill out of
the Little Sukari discovery."
H1 2024 HIGHLIGHTS
●
|
The Group lost time injury
frequency rate ("LTIFR") was 0.32 per one million hours worked and
the total recordable injury frequency rate ("TRIFR") was 1.45 per
one million hours worked
|
●
|
Gold production of 224,738 ounces ("oz")
a 2% year on year ("YoY") increase, and gold sales of 209,269 oz from the
Sukari Gold Mine ("Sukari")
|
●
|
Q2 2024 cash costs and All-in sustaining costs ("AISC")
improved significantly on Q1 2024
performance. H1 2024 Cash costs of US$977/oz produced, and
AISC of US$1,382/oz
sold
|
●
|
Capital expenditure ("capex") of US$89.5
million, including raising tailings
storage facility ("TSF") 2, open pit and underground fleet
purchases, equipment rebuilds, underground ventilation upgrades and
waste mining
|
●
|
Group free cash flow1 of US$42.7
million, a 121% YoY improvement
from US$19.4 million in H1 2023
|
●
|
Positive definitive feasibility study ("DFS") at the Doropo
Gold Project, with a post-tax net
present value of US$426 million using an 8% discount rate ("NPV8%")
and US$1,900/oz gold price2, an internal rate of return
("IRR") of 34% IRR and a 2.1 year payback. Link to 18 July 2024
announcement (here)
|
●
|
Robust balance sheet: cash
and liquid assets of US$200 million, as at 30 June 2024 and total
liquidity of US$350 million including the undrawn US$150 million
sustainability-linked revolving credit facility
|
●
|
Interim dividend of 2.25 US cents per
share, equating to US$26 million,
exceeding the minimum policy of distributing 30% of cash flow
available for dividends3 with a 53% payout
ratio
|
GROUP FINANCIAL SUMMARY4
|
Quarter
on quarter ("QoQ")
comparative
|
Year on
Year ("YoY")
comparative
|
US$'000 unless stated
|
Q2 2024
|
Q1
2024
|
% Δ
|
H1 2024
|
H1
2023
|
% Δ
|
Gold produced (oz)
|
119,917
|
104,821
|
14%
|
224,738
|
220,562
|
2%
|
Gold sold (oz)
|
116,776
|
92,494
|
26%
|
209,269
|
219,354
|
-5%
|
Cash costs (US$/oz
produced)
|
879
|
1,088
|
-19%
|
977
|
849
|
15%
|
AISC (US$/oz
sold)1
|
1,273
|
1,519
|
-16%
|
1,382
|
1,228
|
13%
|
Average realised gold price
(US$/oz)
|
2,341
|
2,062
|
14%
|
2,218
|
1,936
|
15%
|
Revenue
|
274,111
|
190,984
|
44%
|
465,095
|
425,612
|
9%
|
Adjusted
EBITDA1
|
n/a
|
n/a
|
-
|
210,777
|
192,925
|
9%
|
Profit before tax
|
n/a
|
n/a
|
-
|
117,149
|
114,804
|
2%
|
Basic EPS (US cents)
|
n/a
|
n/a
|
-
|
7.19
|
7.86
|
-9%
|
Capital expenditure
|
43,413
|
46,040
|
-6%
|
89,453
|
108,261
|
-17%
|
Operating cash flow
|
n/a
|
n/a
|
-
|
203,560
|
171,767
|
19%
|
Adjusted free cash
flow1
|
32,400
|
10,345
|
213%
|
42,743
|
21,900
|
95%
|
1 Refer to Non-GAAP measures end
note
2 100% project basis, NPV
calculated as of the commencement of construction and excludes all
pre-construction costs
3 See page 8 for interim dividend
calculation
4.The Group publishes
profitability performance metrics on a bi-annual basis
GROUP OPERATIONAL SUMMARY
|
Quarter
on quarter ("QoQ") comparative
|
Year on
Year ("YoY")
comparative
|
|
Q2 2024
|
Q1
2024
|
% Δ
|
H1 2024
|
H1
2023
|
% Δ
|
SAFETY
|
|
|
|
|
|
|
LTIFR (1m hours)
|
0.33
|
0.32
|
3%
|
0.32
|
0.15
|
113%
|
TRIFR (1m hours)
|
1.31
|
1.28
|
2%
|
1.45
|
2.94
|
-51%
|
OPERATIONAL
|
|
|
|
|
|
|
Open pit material mined
(kt)
|
32,312
|
31,772
|
2%
|
64,084
|
65,301
|
-2%
|
Open pit ore mined (kt)
|
7,465
|
6,231
|
20%
|
13,696
|
6,882
|
99%
|
Open pit ore mined grade (g/t
Au)
|
0.67
|
0.63
|
6%
|
0.65
|
0.88
|
-26%
|
Underground ore mined
(kt)
|
278
|
230
|
21%
|
508
|
458
|
11%
|
Underground ore mined grade (g/t
Au)
|
3.33
|
3.2
|
4%
|
3.27
|
4.21
|
-22%
|
Ore processed (kt)
|
3,339
|
3,066
|
9%
|
6,405
|
6,082
|
5%
|
Feed grade (g/t Au)
|
1.19
|
1.12
|
6%
|
1.15
|
1.23
|
-7%
|
Gold recovery (%)
|
87.8
|
87.66
|
0%
|
87.7
|
88.5
|
-1%
|
Gold produced (oz)
|
119,917
|
104,821
|
14%
|
224,738
|
220,562
|
2%
|
|
|
|
|
|
|
| |
FULL YEAR 2024 OUTLOOK - Guidance
Unchanged
Production
|
●
|
Gold production guidance range of
470,000 to 500,000 oz per annum weighted towards H2, as previously
guided
|
Costs
|
●
|
Cash cost guidance range of
US$700-850/oz produced:
|
|
o H1 2024 cash cost performance is tracking slightly above the
guidance range as a result of the cost of moving some 2.4 million
tonnes that was planned to be mined as waste during the period
being reclassified as ore for later treatment through the dump
leach facility. The waste to ore conversion resulted in a lower
strip ratio in Stage 7. As a result of the lower strip ratio the
waste stripping costs that were expected to be allocated to
sustaining capex have been reported in cash costs during the
period.
|
●
|
AISC guidance range of
US$1,200-1,350/oz sold:
|
|
o The H1 2024 AISC of US$1,382/oz is calculated on a per ounce
sold basis and was therefore impacted by the 15,469 oz difference
between production and sales resulting from the timing of gold
sales.
|
●
|
The cost guidance reflects a range
of diesel prices from 75-90 US cents per litre. The average
realised price in H1 2024 was 80 US cents per litre
|
Capex
|
●
|
Adjusted capex guidance of US$215m
is maintained, including:
o US$112m of sustaining capex
o US$103m of non-sustaining capex, of which US$58m is allocated
to growth projects that are funded from Centamin treasury and cost
recovered over three years
o Adjusted capex guidance for the full year excluded US$91m of
sustaining deferred stripping reclassified from operating costs as
per IFRIC 20. As a result of the aforementioned reduction in the
strip ratio, these costs were reported in cash costs and were not
capitalised as originally planned during H1 2024. We now budget
US$45m of sustaining deferred stripping in H2 2024.
|
KEY DELIVERABLES
●
|
Doropo Project DFS, Cote d'Ivoire
(Completed) - Link to 18 July 2024 announcement
(here)
|
●
|
Accelerated waste-stripping
programme (Completed) - Link to 18 July 2024 announcement
(here)
|
●
|
Eastern Desert Exploration ("EDX")
drilling update (H2 2024)
|
●
|
Completion of Solar Expansion
Study (H2 2024)
|
●
|
Sukari 50MW grid connection
project completion (H1 2025)
|
●
|
Doropo final investment decision
(H1 2025)
|
WEBCAST PRESENTATION
The Company will host a webcast
presentation today, Thursday, 25 July 2024, at 08.30 BST to discuss the results, followed by an opportunity
to ask questions.
Webcast link:
https://www.lsegissuerservices.com/spark/Centamin/events/80411d15-3a8c-475a-8162-3bbcf0a2ac0e
PRINT-FRIENDLY VERSION of the
announcement: www.centamin.com/media/companynews.
About Centamin
Centamin is an established gold
producer, with premium listings on the London Stock Exchange and
the Toronto Stock Exchange. The Company's flagship asset is the
Sukari Gold Mine ("Sukari"), Egypt's largest and first modern gold
mine, as well as one of the world's largest producing mines. Since
production began in 2009 Sukari has produced 5.7 million ounces of
gold, and today has a projected mine life to 2034.
Through its large portfolio of
exploration assets in Egypt and Côte d'Ivoire, Centamin is
advancing an active pipeline of future growth prospects, including
the Doropo project in Côte d'Ivoire, and over 3,000km2
of highly prospective exploration ground in Egypt's Arabian Nubian
Shield.
Centamin practices responsible
mining activities, recognising its responsibility to deliver
operational and financial performance and create lasting mutual
benefit for all stakeholders through good corporate
citizenship.
FOR MORE INFORMATION please
visit the website www.centamin.com
or contact:
ENDNOTES
Guidance
The Company actively monitors the
global geopolitical uncertainties and macroeconomics, such as
global inflation, and guidance may be impacted if the supply chain,
workforce or operations are disrupted.
Non-GAAP measures
This statement includes certain
financial performance measures which are not GAAP measures as
defined under International Financial Reporting Standards (IFRS).
These include EBITDA and adjusted EBITDA, Cash costs of production,
AISC, Cash and liquid assets, Free cash flow and adjusted Free cash
flow. Management believes these measures provide valuable
additional information for users of the financial statements to
understand the underlying trading performance. An explanation of
the measures used along with reconciliation to the nearest IFRS
measures is provided in the Financial Review.
Profit after-tax attributable to the owners of the parent
("shareholders")
Centamin's profit after the profit
share split with the Egyptian Mineral Resource Authority ("EMRA"),
the Company's Egyptian government partner.
Royalties
Royalties are accrued and paid six
months in arrears.
Liquidity
Liquidity is defined as the sum of
cash and cash equivalents and available credit under the Company's
revolving credit facility.
Movements in inventory
Movement in inventory on ounces
produced is the movement in mining stockpiles and ore in circuit
while the movement in inventory on ounces sold is the net movement
in mining stockpiles, ore in circuit and gold in safe
inventory.
Gold produced
Gold produced is gold poured and
does not include gold-in-circuit at period end.
Forward-looking Statements
This announcement (including
information incorporated by reference) contains "forward-looking
statements" and "forward-looking information" under applicable
securities laws (collectively, "forward-looking statements"),
including statements with respect to future financial or operating
performance. Such statements include "future-oriented financial
information" or "financial outlook" with respect to prospective
financial performance, financial position, EBITDA, cash flows and
other financial metrics that are based on assumptions about future
economic conditions and courses of action. Generally, these
forward-looking statements can be identified by the use of
forward-looking terminology such as "believes", "expects",
"expected", "budgeted", "forecasts" and "anticipates" and include
production outlook, operating schedules, production profiles,
expansion and expansion plans, efficiency gains, production and
cost guidance, capital expenditure outlook, exploration spend and
other mine plans. Although Centamin believes that the expectations
reflected in such forward-looking statements are reasonable,
Centamin can give no assurance that such expectations will prove to
be correct. Forward-looking statements are prospective in nature
and are not based on historical facts, but rather on current
expectations and projections of the management of Centamin about
future events and are therefore subject to known and unknown risks
and uncertainties which could cause actual results to differ
materially from the future results expressed or implied by the
forward-looking statements. In addition, there are a number of
factors that could cause actual results, performance, achievements
or developments to differ materially from those expressed or
implied by such forward-looking statements; the risks and
uncertainties associated with direct or indirect impacts of
COVID-19 or other pandemic, general business, economic,
competitive, political and social uncertainties; the results of
exploration activities and feasibility studies; assumptions in
economic evaluations which prove to be inaccurate; currency
fluctuations; changes in project parameters; future prices of gold
and other metals; possible variations of ore grade or recovery
rates; accidents, labour disputes and other risks of the mining
industry; climatic conditions; political instability; decisions and
regulatory changes enacted by governmental authorities; delays in
obtaining approvals or financing or completing development or
construction activities; and discovery of archaeological ruins.
Financial outlook and future-ordinated financial information
contained in this news release is based on assumptions about future
events, including economic conditions and proposed courses of
action, based on management's assessment of the relevant
information currently available. Readers are cautioned that any
such financial outlook or future-ordinated financial information
contained or referenced herein may not be appropriate and should
not be used for purposes other than those for which it is disclosed
herein. The Company and its management believe that the prospective
financial information has been prepared on a reasonable basis,
reflecting management's best estimates and judgments at the date
hereof, and represent, to the best of management's knowledge and
opinion, the Company's expected course of action. However, because
this information is highly subjective, it should not be relied on
as necessarily indicative of future results. There can be no
assurance that forward-looking statements will prove to be
accurate, as actual results and future events could differ
materially from those anticipated in such information or
statements, particularly in light of the current economic climate
and the significant volatility, the risks and uncertainties
associated with the direct and indirect impacts of COVID-19.
Forward-looking statements contained herein are made as of the date
of this announcement and the Company disclaims any obligation to
update any forward-looking statement, whether as a result of new
information, future events or results or otherwise. Accordingly,
readers should not place undue reliance on forward-looking
statements.
LEI: 213800PDI9G7OUKLPV84
Company No: 109180
CEO OPERATIONAL Review
(H1 2024 vs H1 2023)
I am pleased to report a solid
first half of 2024 at Sukari, whilst continuing to advance numerous
projects and work streams that will unlock the full potential of
Centamin's portfolio. We remain on track to deliver against our
2024 guidance and all key capital projects are
progressing.
HEALTH & SAFETY
We maintained our focus on the
protection of our workforce and the local communities that we work
in. Our safety performance continues to be strong, while noting
that our ultimate ambition is to create a zero-harm
workplace.
We had one lost time injury at
Sukari (as previously reported in Q1 2024) and two at EDX during H1
2024.
The Group's LTIFR was 0.32 per one
million hours worked and we remain focused on meeting our annual
target. The Group TRIFR was 1.45 per one million hours worked, a
51% decrease YoY.
SUSTAINABILITY
Centamin published the 2023
Sustainability Report (Link to report here)
which was produced in accordance with the GRI Sustainability
Reporting Standards ("GRI") 'Core option'; the GRI Mining and
Metals Sector Supplement; the Sustainability Accounting Standards
Board ("SASB") for the metals and mining industry; and the
recommendations of the Task Force on Climate-related Financial
Disclosures ("TCFD"). This report also provides a statement of our
conformance to the Global Industry Standard on Tailings Management
("GISTM").
CORPORATE
I am delighted to report the
promotion of Gustav du Toit to the role of Chief Operating Officer,
after two and a half years in the role of General Manager of the
Sukari mine where he led the reinvestment programme and the
resulting operational reset at Sukari. Gustav's responsibilities
will now broaden to include oversight of EDX and the advancement of
the Doropo project, following the completion of the positive DFS.
Gavin Harris takes on the role of Sukari General Manager, from his
previous role as Operations Director and Deputy General Manager.
Islam Al Ashker has been promoted to the role of Deputy General
Manager. The fact that all three roles have been filled by the
promotion of internal candidates demonstrates the depth of talent
within the team and the benefit of the employee development
programme which looks to identify, develop and promote individuals
into leadership positions.
SUKARI GOLD MINE (Egypt)
The team delivered another solid
operational performance in H1 2024 and we remain on track to meet
the 2024 production guidance.
In the open pit, a total of 64 Mt
of material was mined, representing a 2% decrease year-over-year
(YoY). Of this, 50 Mt was waste, with 33 Mt mined by the Centamin
fleet and the remainder by contractor Capital Ltd. The 120 Mt
accelerated waste-stripping programme was completed ahead of
schedule, allowing us to retain Capital Ltd to mine up to 10 Mt of
waste over the next three months to September 2024. The additional
capacity will support the construction of a new dump leach pad, as
well as facilitating the early completion of limited waste
stripping scheduled for 2025 ahead of the delivery of the new 785C
dump trucks. The net result is expected to be an incremental 2 to 3
Mt to the planned total annual volume at Sukari for 2024, equating
to a 1-2% increase.
We mined 14 Mt of ore at an
average grade of 0.65 g/t Au, a 99% increase in tonnage and a 26%
decrease in grade YoY. This change reflects the reclassification of
material from Stage 7, which was previously scheduled as waste, to
low-grade ore, leading to a reduction in
the strip ratio for Stage 7. The majority of the reclassified
material was placed on the dump leach with the balance going to
stockpiles. The average milled grade from the open pit was 0.97 g/t
Au for H1 2024, a 2% decrease YoY.
The underground mine demonstrated
the benefits of significant infrastructure and equipment upgrades
since transitioning to owner mining, with the final ventilation
upgrade completed in Q1 2024. These enhancements resulted in an 11%
year-over-year (YoY) increase in ore tonnage mined. Although grades
were lower YoY, averaging 3.3 g/t Au, we expect average grades to
improve in H2 2024, aligning with our underground reserve
grade.
The plant processed 6.4Mt of ore
at an average feed grade of 1.15 g/t Au, a 5% increase in tonnes
and 7% decrease in grade YoY. There were several key projects
during the period, including mill relining and work on the mill
motors, all of which were completed successfully with no unplanned
disruption to throughput.
The metallurgical gold recovery
rate was 87.7%, reflecting a 1% decrease year-over-year (YoY). This
was influenced by the processing of oxide ore mined in Stage 7,
which negatively impacts recovery rates, in addition to the lower
feed grade. The mining of oxide ore is largely complete, and the
remaining oxide ore will be blended to minimise its impact on
recovery.
Doropo GOLD Project (Côte
d'Ivoire)
On 18 July 2024, we published the
results from the
Doropo definitive-feasibility study ("DFS"), which demonstrated the economic robustness of the
project with a post-tax NPV8% of US$426 million and an
IRR of 34% at US$1,900/oz gold prices. Importantly, it fulfils
Centamin's hurdle rate of 15% internal rate of return ("IRR") at
the US$1,450/oz gold price used for Mineral Reserve
estimation.
The project sits in a
well-established mining jurisdiction with a Mineral Reserve
estimate of 1.87Moz, supporting a 10-year life of mine averaging a
production rate 167,000 ounces per annum at all-in sustaining costs
of US$1,047/oz.
Financing options for the project
are well advanced, supported by a clear roadmap for early works
that will mitigate completion risks. This study underlines our
confidence in Doropo's potential to become a commercially viable
project, bringing substantial investment and employment
opportunities to northeastern Côte d'Ivoire.
The DFS has resulted in a plan
with significantly lower execution risk, relative to the PFS,
reflecting a reconfiguration of the project to reduce its social
impact on local communities. We received regulatory approval of the
Environmental and Social Impact Assessment with the receipt of the
environmental permit in June 2024. The DFS, together with the
environmental permit will form key documents in support of our
submission for a mining licence to the Côte d'Ivoire Government.
This application is scheduled to be submitted in Q3 2024. Following
the award of the mining licence and conclusion of the mining
convention, we will then progress to a final investment decision,
following which we will provide an update on the project
financing.
Of the US$14 million budgeted for
Doropo in 2024, US$8.6 million was spent on completion of both the
DFS and completing the Environmental and
Social Impact Assessment ("ESIA"). There
is up to US$6 million identified for early works including starting
front-end engineering design ("FEED"), grade control drilling and
some limited earthworks. These activities will reduce project
delivery risk and potentially expedite construction
timelines.
EXPLORATION
Eastern Desert Exploration ("EDX") (Egypt)
At the previously identified
targets within the Nugrus block, Little Sukari, and Umm Majal, the
exploration team completed detailed mapping and ground-based
geophysical surveys, consisting of induced polarization (IP) and
magnetic surveys. The second phase of drilling commenced across
these targets, which will now include an expanded programme of 20km
of core and reverse circulation drilling, building on the
successful initial drill campaign as reported
(here).
In the Um Rus block, follow-up work on soil and rock chip samples
from BLEG anomalies has been completed. In the Nadj block, we
established a remote camp and successfully concluded the BLEG
sampling programme, with the collected samples now being prepared
for analysis in overseas laboratories. An update on the EDX
drilling programme is expected to be announced in the second half
of 2024.
ABC (Côte d'Ivoire)
At ABC, in light of encouraging
drill results from neighbouring permits to the north, we undertook
a soil sampling programme across the northern portion of the
Farako-Nafana permit. This area was previously sampled using
termite mounds as the sample medium; however, it was prudent to
re-sample using soil geochemistry to ensure accuracy.
Geological interpretation of the
soils data is ongoing. If any soil anomalies are identified that
require further investigation, we plan to initiate a drill testing
programme towards the end of the year, during the dry season.
Additionally, there is potential to conduct infill drilling in the
Kona Central and South resources.
OUTLOOK
Centamin remains well positioned,
and guidance for 2024 remains
unchanged.
I would like to commend our
workforce for their commitment, professionalism and passion. I
would also like to thank our local communities, partners and wider
stakeholders for their support and shared vision.
We look forward to a busy second
half of news flow, as we continue to deliver on our commitments and
progress towards our vision of being a responsible multi-asset,
multi-jurisdictional producer.
Martin Horgan
CEO
25 July 2024
CFO FINANCIAL REVIEW
(H1 2024 vs H1 2023)
We are pleased to report material
improvements across the majority of our key financial metrics
including revenue, EBITDA, profit before tax, operating cash flow
and free cash flow.
H1 2024 has delivered strong
operating cash flow of US$204 million. This translated into a
positive Group free cash flow of US$43
million, after Sukari profit share distributions of US$74 million
to our Egyptian partner, EMRA, and US$74 million to Centamin, and
US$12 million spent advancing our organic growth pipeline at Doropo
(Côte d'Ivoire),
EDX (Egypt) and ABC (Côte d'Ivoire).
FINANCIAL PERFORMANCE
Revenues increased YoY by 9% to
US$464 million, from annual gold sales of 209,269 ounces, down 5%,
at an average realised price of US$2,218/oz, up 15% YoY. Due to
timing of gold shipments, a total of 22,381 ounces of unsold gold
bullion was held at Sukari as at 30 June 2024, equivalent to US$52
million which has now been sold.
The Group adjusted EBITDA was
US$211 million, at a 45% EBITDA margin and up 9% YoY, principally
driven by
●
|
A 15% increase in average realised
gold price; but also due to:
|
●
|
A 2% decrease in the combined open
pit and underground material mined;
|
●
|
Lower fuel prices, offset by
higher processed volumes, has resulted in a net US$8 million
savings against budget; and
|
●
|
Offset by a reduction in stripping costs capitalised to the balance
sheet during the period (as per IFRIC 20). This was due to material
designated as waste in the plan which, upon mining this material,
was reclassified as low-grade ore, the strip ratio was reduced
accordingly, and as a result, those costs remained as operating
costs for the period, except for the relevant portion capitalised
as inventory at period end.
|
Profit before tax increased by 2% to US$117
million, due to:
●
|
9% increase in revenue, in line with the 15%
increase in average realised gold price offset by the 5% decrease
in gold ounces sold;
|
●
|
a significant increase in finance
income due to rising interest rates in both Egypt and the United
Kingdom which resulted in a US$1.3 million increase in interest
income from funds placed in term-deposit, offset by:
|
|
○
|
42% increase in other operating
costs, predominantly due to
|
|
|
○
|
a US$3m increase in corporate
costs related to share-based payments and salaries and wages offset
by decrease in the cost of consultants;
|
|
|
○
|
a US$1m increase in royalties
paid; and
|
|
|
○
|
a US$6m increase in provisions for
obsolete and redundant stock
|
|
○
|
36% decrease in greenfield
exploration and evaluation expenditure, as budgeted;
and
|
|
○
|
10% increase in cost of sales as
lower stripping costs were capitalised due to better-than-expected
ore to waste conversion.
|
|
|
|
| |
The above factors together with an
increase in EMRA distributions during the period resulted in basic
EPS decreasing by 9% to 7.19 US cents.
COST MANAGEMENT
Cash costs of production in H1
2024 were US$220 million, a 17% increase YoY. This is primarily due
to lower capitalisation of costs (discussed above), increased
output from the underground and higher throughput in the plant.
Unit cash costs of production were US$977/oz produced, a 15%
increase, driven by the aforementioned cost drivers, partly offset
by higher production volumes.
AISC in H1 2024 were US$289
million, a 7% increase YoY, and with lower sales volumes (due to
timing of gold shipments) resulting in unit AISC of US$1,382/oz
sold, a 13% increase YoY.
STRONG FINANCIAL POSITION
As of 30 June 2024, Centamin had
cash and liquid assets of US$200 million, including 22koz of gold
inventory waiting to be sold. From a liquidity standpoint, the
US$150 million sustainability-linked revolving credit facility
remains available and undrawn.
CAPITAL INVESTMENT
H1 2024 gross capital expenditure
was US$89 million, including the underground ventilation upgrades,
continued contracted waste-stripping programme, new underground and
open pit equipment purchases, underground development, open pit
equipment rebuilds, and raising TSF2.
Total sustaining capex was US$47
million, and non-sustaining was US$42 million. We had expected a
higher capex spend in H1 but due to minor changes in scheduling,
this has been moved to H2 2024 and we remain on track to meet 2024
guidance.
Interim dividend
Consistent with the Company's
stated commitment to shareholder returns, the Board declares an
interim dividend of 2.25 US cents per share (US$26 million) for the
six-month period ended 30 June 2024. As per the dividend policy,
this distribution is in line with the commitment to return a
minimum of 30% of Group free cash flow
before growth capex3 to shareholders in cash dividends.
In consideration of the below factors, and reflecting the Board's
confidence, a total of 53% of H1 2024 Group free cash flow before
growth capex will be distributed to shareholders on 27 September
2024:
●
|
Centamin is in a financially
robust position with US$200 million in cash and liquid
assets;
|
●
|
The US$150 million sustainability
linked revolving credit facility remains undrawn as a result of H1
2024 growth capex being funded from internally generated cash
flows; and
|
●
|
The Company is operationally and
financially well positioned for a stronger H2 2024, in line with
plan.
|
The interim dividend is calculated
by the following:
|
|
30 June
2024
(Unaudited)
|
|
|
US$'000
|
Group free cash flow
|
42,743
|
Add back:
|
|
Growth capex financed from
treasury1
|
|
6,446
|
|
|
|
Cashflow available for dividends
|
49,189
|
30% minimum distribution as per dividend
policy
|
(14,757)
|
Surplus cash flow for discretionary capital
allocation2
|
|
34,432
|
Board interim dividend supplement
|
|
(11,367)
|
|
|
|
Total interim dividend declared
|
|
26,124
|
1 Defined as Sukari growth capex
funded from Treasury and available for cost-recovery as per the
Concession Agreement.
2 Discretionary capital allocation
options include future project investment, portfolio optimisation
and supplemental shareholder returns
Please refer to the Dividend
Declaration announcement and or the website
(www.centamin.com/investors/shares-dividends/dividend-information/)
for further detail including the interim dividend
timetable.
OUTLOOK
Financially, we expect a stronger
second half of 2024 driven by higher production volumes. Meanwhile,
our focus on cost management means we remain fully focused on
managing the bottom line of the business so that we can maximise
the value at Sukari whilst delivering growth and diversification
alongside stakeholder returns.
ROSS JERRARD
CFO
25 July 2024
primary statements highlights
|
H1 2024
(Unaudited)
US$'000
|
H1 2023
(Unaudited)
US$'000
|
Full Year
2023
(Audited)
US$'000
|
Revenue
|
465,095
|
425,612
|
891,262
|
Revenue from gold and silver sales
for the period increased by 9% year-on-year to US$465 million
(2023: US$426 million) with a 15% increase in the year-on-year
average realised gold price to US$2,218 per ounce sold (2023:
US$1,936 per ounce sold) offset by a 5% decrease in gold ounces
sold to 209,269 ounces (2023: 219,354 ounces).
|
H1 2024
(Unaudited)
US$'000
|
H1 2023
(Unaudited)
US$'000
|
Full Year
2023
(Audited)
US$'000
|
Cost of sales
|
(295,091)
|
(267,801)
|
(596,836)
|
Cost of sales represents the cost
of mining, processing, refining, transport, site administration,
depreciation, amortisation and movement in production inventories.
Cost of sales is up 10% year-on-year to US$295 million.
|
H1 2024
(Unaudited)
US$'000
|
H1 2023
(Unaudited)
US$'000
|
Full Year
2023
(Audited)
US$'000
|
Dividend paid - non-controlling interest in
SGM
|
(74,000)
|
(46,000)
|
(112,000)
|
Profit share payments during the
year are reconciled against SGM's audited financial statements. Any
variation between payments made during the year (based on the
Company's estimates) and the SGM's audited financial statements,
may result in a balance due and payable to EMRA or advances to be
offset against future distributions. SGM's 30 June 2023 financial
statements have been audited and signed off; the 30 June 2024
financial statements will be audited in due course in line with the
agreed timetable.
Certain terms of the Concession
Agreement (CA) and amounts in the cost recovery model may also vary
depending on interpretation and are therefore subject to continued
discussions between EMRA and management which can result in
variations in the profit-sharing split between periods. Centamin
and EMRA continue working on closing outstanding open audit periods
as well as agree on the timing and mechanism of any financing and
ultimately the distribution of future proceeds between
partners.
Refer to note 1.2.1.2 in the 2023
Annual Report for details of the treatment and disclosure of the
EMRA profit share.
CAPITAL EXPENDITURE
The following table provides a
breakdown of the total capital expenditure of the Group:
|
H1 2024
(Unaudited)
US$'000
|
H1 2023
(Unaudited)
US$'000
|
Full Year
2023
(Audited)
US$'000
|
Underground exploration
|
3,884
|
5,368
|
9,225
|
Underground mine
development
|
14,962
|
16,011
|
32,350
|
Other sustaining capital
expenditure
|
28,155
|
28,950
|
46,241
|
Total sustaining capital expenditure
|
47,001
|
50,329
|
87,816
|
Non-sustaining exploration
expenditure
|
-
|
1,210
|
2,947
|
Other non-sustaining capital
expenditure(1)
|
42,452
|
56,723
|
113,348
|
Total gross capital expenditure
|
89,453
|
108,262
|
204,111
|
Less:
|
|
|
|
Sustaining element of waste
stripping capitalised(2)
|
-
|
(10,023)
|
(843)
|
Capitalised Right of Use
Assets
|
(14)
|
(66)
|
(1,216)
|
Adjusted capital expenditure
|
89,439
|
98,173
|
202,052
|
(1) Non-sustaining capital expenditure included
the spend on North dump leach pad expansion, tailings storage
facility stage lifts and the Capital Waste Stripping.
Non-sustaining costs are primarily those costs incurred at 'new
operations' and costs related to 'major projects at existing
operations' that will materially benefit the
operation.
(2) Reclassified from operating
expenditure.
EXPLORATION EXPENDITURE
The following table provides a
breakdown of the total exploration expenditure of the
Group:
|
H1 2024
(Unaudited)
US$'000
|
H1 2023
(Unaudited)
US$'000
|
Full Year
2023
(Audited)
US$'000
|
Greenfield exploration
|
|
|
|
Burkina Faso
|
-
|
775
|
869
|
Côte d'Ivoire
|
8,816
|
15,914
|
25,226
|
Egypt - Eastern Desert
Exploration
|
3,255
|
2,234
|
5,558
|
Total greenfield exploration expenditure
|
12,071
|
18,923
|
31,653
|
Brownfield exploration
|
|
|
|
Sukari Tenement
|
3,884
|
6,578
|
12,172
|
Total brownfield exploration expenditure
|
3,884
|
6,578
|
12,172
|
Total exploration expenditure
|
15,955
|
25,501
|
43,825
|
Exploration and evaluation
expenditure comprises expenditure incurred for exploration
activities primarily in Côte d'Ivoire and in the Egypt greenfield
permit areas. Greenfield exploration and evaluation costs
(excluding Burkina Faso) decreased by US$6 million or 33%,
primarily driven by reduced work in Côte d'Ivoire as the Definitive
Feasibility Study ("DFS") stage of the Doropo project has now been
finalised. Drilling work was however significantly expanded in the
new Egypt permit areas hence the 41% or US$0.9 million increase in
the exploration costs in that area. The brownfield capitalised
exploration costs on the Sukari concession area decreased by US$3
million or 41% year on year due to the decrease in the surface
exploration and evaluation work and related activities within the
Sukari concession areas.
The spend in Burkina Faso was
mainly on key services and other regulatory obligations required to
formally exit the country. The in country incorporated entities
have now been formally liquidated.
SUBSEQUENT EVENTS
Interim dividend
The Directors have declared an
interim dividend of 2.25 US cents per share on Centamin plc
ordinary shares (totalling approximately US$26 million). The
interim dividend for the half year period ended 30 June 2024 will
be paid on 27 September 2024 to shareholders on the register on the
Record Date of 30 August 2024.
Other than as noted above, there
were no other significant events occurring after the reporting date
requiring disclosure in the financial statements.
NON‑GAAP FINANCIAL
MEASURES
1) EBITDA and adjusted EBITDA
EBITDA is a non‑GAAP financial measure, which
excludes the following from profit before tax:
·
|
Finance costs
|
·
|
Finance income
|
·
|
Depreciation and
amortisation
|
Management considers EBITDA a
valuable indicator of the Group's ability to generate liquidity by
producing operating cash flow to fund working capital needs and
capital expenditures. EBITDA is also frequently used by investors
and analysts for valuation purposes whereby EBITDA is multiplied by
a factor or 'EBITDA multiple' that is based on an observed or
inferred relationship between EBITDA and market values to determine
a company's approximate total enterprise value. EBITDA is intended
to provide additional information to investors and analysts and
does not have any standardised definition under IFRS and should not
be considered in isolation or as a substitute for measures of
performance prepared in accordance with IFRS.
EBITDA excludes the impact
of income from financing activities and
taxes, and therefore is not necessarily indicative of operating
profit or cash flow from operations as determined under IFRS. Other
companies may also calculate EBITDA differently. The following
table provides a reconciliation of EBITDA to profit for the year
before tax.
Adjusted EBITDA removes the effect
of transactions that are not core to the Group's main operations,
like adjustments made to normalise earnings, for example profit on
financial assets at fair value through profit or loss, impairments
of property, plant and equipment, non-current mining stockpiles and
exploration and evaluation assets.
Reconciliation of profit before tax to EBITDA and adjusted
EBITDA:
|
|
H1 2024
(Unaudited)
|
H1 2023
(Unaudited)
|
Full Year
2023
(Audited)
|
Profit for the year before
tax
|
US$'000
|
117,149
|
114,804
|
195,140
|
Finance income
|
US$'000
|
(3,126)
|
(1,791)
|
(4,127)
|
Finance costs
|
US$'000
|
2,179
|
1,380
|
3,526
|
Depreciation and
amortisation
|
US$'000
|
93,921
|
79,022
|
198,127
|
EBITDA
|
US$'000
|
210,123
|
193,415
|
392,666
|
Add
back/(less)(1)
|
US$'000
|
|
|
|
Net fair value loss/(gain) on
derivative financial instruments
|
US$'000
|
654
|
(490)
|
5,509
|
Adjusted EBITDA
|
US$'000
|
210,777
|
192,925
|
398,175
|
(1) Adjustments
made to normalise earnings for example profit on financial assets
at fair value through profit or loss, impairments of property,
plant and equipment, non-current mining stockpiles and exploration
and evaluation assets.
2) Cash cost of production per ounce produced and sold and
all-in sustaining costs ("AISC") per ounce sold
calculation
Cash cost of production and AISC
are non-GAAP financial measures. Cash cost of production per ounce
is a measure of the average cost of producing an ounce of gold,
calculated by dividing the operating costs in a period by the total
gold production over the same period. Operating costs represent
total operating costs less sustaining administrative expenses,
royalties, depreciation and amortisation. Management uses this
measure internally to better assess performance trends for the
Company as a whole. Management considers that, in addition to
conventional measures prepared in accordance with GAAP, certain
investors use such non-GAAP information to evaluate the Company's
performance and ability to generate cash flows. Management
considers that these measures provide an alternative reflection of
the Group's performance for the current year and are an alternative
indication of its expected performance in future periods. Cash cost
of production is intended to provide additional information, does
not have any standardised meaning prescribed by GAAP and should not
be considered in isolation or as a substitute for measures of
performance prepared in accordance with GAAP. This measure is not
necessarily indicative of operating profit or cash flow from
operations as determined under GAAP. Other companies may calculate
these measures differently.
Reconciliation of cash cost of production per
ounce produced:
|
|
H1 2024
(Unaudited)
|
H1 2023
(Unaudited)
|
Full Year
2023
(Audited)
|
Mine production costs (note
2.2)
|
US$'000
|
219,407
|
188,344
|
412,827
|
Less: Refinery and
transport
|
US$'000
|
(737)
|
(1,182)
|
(1,871)
|
Movement in inventory
(1)
|
US$'000
|
837
|
(5)
|
(17,133)
|
Cash cost of production - gold produced
|
US$'000
|
219,507
|
187,157
|
393,823
|
|
|
|
|
|
Gold produced - total
(oz.)
|
oz
|
224,738
|
220,562
|
450,058
|
Cash cost of production per ounce produced
|
US$/oz
|
977
|
849
|
875
|
|
|
|
|
|
|
| |
1) The
movement in inventory on ounces produced is only the net movement
in mining stockpiles and ore in circuit while the movement in
ounces sold (in table below) is the net movement in mining
stockpiles, ore in circuit and gold in safe inventory.
A reconciliation has been included
below to show the cash cost of production metric should gold sold
ounces be used as a denominator.
Reconciliation of cash cost of production per ounce
sold:
|
|
H1 2024
(Unaudited)
|
H1 2023
(Unaudited)
|
Full Year
2023
(Audited)
|
Mine production costs (note
2.2)
|
US$'000
|
219,407
|
188,344
|
412,827
|
Royalties
|
US$'000
|
13,931
|
12,733
|
26,682
|
Movement in inventory
(1)
|
US$'000
|
(9,334)
|
3,346
|
(9,536)
|
Cash cost of production - gold sold
|
US$'000
|
224,004
|
204,423
|
429,973
|
|
|
|
|
|
Gold sold - total (oz.)
|
oz
|
209,269
|
219,354
|
456,625
|
Cash cost of production per ounce sold
|
US$/oz
|
1,070
|
932
|
942
|
|
|
|
|
|
Movement in inventory
|
|
|
|
|
Movement in inventory - cash
(above)
|
US$'000
|
(9,334)
|
3,346
|
(9,536)
|
Effect of depreciation and
amortisation - non-cash
|
US$'000
|
27,227
|
(4,062)
|
22,855
|
Movement in inventory - cash & non-cash (note
2.2)
|
US$'000
|
17,893
|
(716)
|
13,319
|
|
|
|
|
| |
(1) The movement
in ounces sold is the net movement in mining stockpiles, ore in
circuit and gold in safe inventory while the movement in inventory
on ounces produced (in table above) is only the net movement in
mining stockpiles and ore in circuit while.
Reconciliation of AISC per ounce sold:
|
|
H1 2024
(Unaudited)
|
H1 2023
(Unaudited)
|
Full Year
2023
(Audited)
|
Mine production costs (note
2.2)
|
US$'000
|
219,407
|
188,344
|
412,827
|
Movement in inventory
|
US$'000
|
(9,334)
|
3,346
|
(9,536)
|
Royalties
|
US$'000
|
13,931
|
12,733
|
26,682
|
Sustaining corporate
administration costs
|
US$'000
|
18,459
|
14,964
|
33,110
|
Rehabilitation provision interest
expense unwinding
|
US$'000
|
803
|
668
|
1,333
|
Sustaining underground development
and exploration
|
US$'000
|
18,847
|
21,379
|
41,575
|
Other sustaining capital
expenditure
|
US$'000
|
28,155
|
28,950
|
46,241
|
By‑product credit
|
US$'000
|
(973)
|
(928)
|
(1,878)
|
All‑in sustaining costs
(1)
|
US$'000
|
289,295
|
269,456
|
550,354
|
|
|
|
|
|
Gold sold - total (oz.)
|
oz
|
209,269
|
219,354
|
456,625
|
AISC per ounce sold
|
US$/oz
|
1,382
|
1,228
|
1,205
|
|
|
|
|
|
|
|
| |
(1) Includes
refinery and transport.
3) Cash and cash equivalents, bullion on hand and
gold and silver sales debtor AND FINANCIAL ASSETS AT FAIR VALUE
THROUGH PROFIT OR LOSS
Management considers that, in
addition to conventional measures prepared in accordance with GAAP,
certain investors use such non-GAAP information to evaluate the
Company's performance and ability to generate cash flow and the
measure is intended to provide additional information.
Cash and cash equivalents, bullion
on hand, gold and silver sales debtor and financial assets at fair
value through profit or loss is a non-GAAP financial measure of the
available cash and liquid assets at a point in time. Management
uses this measure internally to better assess performance trends
for the Company as a whole.
This non-GAAP measure does not
have any standardised meaning prescribed by GAAP and should not be
considered in isolation or as a substitute for measures of
performance prepared in accordance with GAAP. This measure is not
necessarily indicative of cash and cash equivalents as determined
under GAAP and other companies may calculate it
differently.
Reconciliation to cash and cash equivalents, bullion on hand, gold and
silver sales debtor and financial assets at fair value through
profit or loss:
|
|
H1 2024
(Unaudited)
US$'000
|
H1 2023
(Unaudited)
US$'000
|
Full Year
2023
(Audited)
US$'000
|
Cash and cash equivalents (note
2.10(a))
|
|
109,607
|
96,231
|
93,322
|
Bullion on hand (valued at the
period-end spot price)
|
|
52,167
|
28,095
|
14,261
|
Gold and silver sales
debtor
|
|
38,366
|
33,573
|
44,917
|
Derivative instruments at fair
value through profit or loss
|
|
-
|
3,028
|
654
|
Cash and cash equivalents, bullion on hand, gold and
silver sales debtor and financial assets at fair value through
profit or loss
|
200,140
|
160,927
|
153,154
|
|
|
|
|
|
| |
The majority of funds have been
invested in international rolling short-term fixed interest money
market deposits.
4) Free cash flow and adjusted free cash
flow
Free cash flow is a non-GAAP
financial measure. Free cash flow is a measure of the available
cash after distributions to the Non-Controlling Interest ("NCI") in
SGM, being EMRA, that the Group has at its disposal to use for
capital reinvestment and to distribute to shareholders of the
parent. Free cash flow is intended to provide additional
information, does not have any standardised meaning prescribed by
GAAP and should not be considered in isolation or as a substitute
for measures of performance prepared in accordance with GAAP. This
measure is not necessarily indicative of operating profit or cash
flow from operations as determined under GAAP and other companies
may calculate this measure differently.
|
|
H1 2024
(Unaudited)
US$'000
|
H1 2023
(Unaudited)
US$'000
|
Full Year
2023
(Audited)
US$'000
|
Net cash generated from operating
activities
|
|
203,409
|
171,767
|
353,600
|
Less:
|
|
|
|
|
Net cash used in investing
activities
|
|
(86,666)
|
(106,405)
|
(198,768)
|
Dividend paid - non-controlling
interest in SGM
|
|
(74,000)
|
(46,000)
|
(112,000)
|
Free cash flow
|
|
42,743
|
19,362
|
42,832
|
Add back:
|
|
|
|
|
Transactions completed through
specific available cash resources (1)
|
|
-
|
2,538
|
6,163
|
Adjusted free cash flow
|
|
42,743
|
21,900
|
48,995
|
(1) Adjustments made
to free cash flow, for example acquisitions and disposals of
financial assets at fair value through profit or loss, which are
completed through specific allocated available cash
reserve
governanCe
Share Plan Awards
Granted 02 May 2024
·
|
The Company granted 3,348,600
performance share awards over ordinary shares of nil par value to
16 employees of the Group under the Company's shareholder approved
Incentive Share Plan. Performance conditions and further details of
the scheme can be found in the 2023
Annual Report.
|
·
|
The Company granted 2,510,700
restricted cash settled share awards over ordinary shares of nil
par value to 92 senior employees across the Group under the
Company's shareholder approved Incentive Share Plan. These awards
vest annually over a three-year period in equal tranches to
participants, subject to the scheme rules and the employee
remaining with the Company.
|
PRINCIPAL RISKS AND Uncertainties
RISK MANAGEMENT
Centamin recognises that nothing
is without risk. We believe a successful and sustainable business
requires a robust and proactive risk management framework as its
foundation. This is supported by a strong culture of risk
awareness, encouraging openness and integrity, alongside a clearly
defined appetite for risk. This enables the Company to consider
risks and opportunities for more effective decision-making,
delivery on our objectives and improve our performance as a
responsible mining company. The Board has overall responsibility,
supported by the Audit and Risk Committee, for establishing a
framework that allows for the review of existing and emerging risks
in the context of both opportunities and potential threats that
inform the principal risks and uncertainties. These risks and
opportunities inform the assessment of the future prospects and
long-term viability of the Group, as shown in the Viability
Statement of the 2023 Annual Report and are also considered when
challenging the strategic objectives of the Company.
2024 continues to provide
macroeconomic change exacerbated by geopolitical pressures
including the ongoing conflicts in Gaza, the Rea Sea and Ukraine.
Whilst as a business we were able to successfully manage the
operational considerations these have brought, we have felt the
financial pressures as every government, business and individual
has globally. The 2023 Annual Report included the latest updates to
the principal and emerging risks driven by these
pressures.
We continue to feel the ongoing
global impact of these increased financial pressures, which we
carry on monitoring, and has led to the introduction of additional
mitigations and changes to our ongoing strategy for the financially
focussed risks. When considering the healthy financial position of
the business, including additional measures such as the revolving
credit facility, means we feel there is sufficient financial
flexibility to meet the Company's current and future financial
commitments through 2024.
The Directors confirm that a
robust assessment of the principal, new and emerging risks
impacting the Company has been undertaken which identified
external, strategic and operational risks on a sliding scale
depending on the level of influence over which the Company may have
on the factors which can impact the risk. For further detail please
refer to the Risk Review within the 2023 Annual Report and 2023
Sustainability Report, published on the Company's website:
www.centamin.com.
PRINCIPAL RISKS
The principal risks and
uncertainties facing the Group remain unchanged from those which
are set out in detail within the Strategic Report section of the
2023 Annual Report and can be found on the Company's website
(https://www.centamin.com/investors/principal-risks-and-uncertainties/)
.
The principal risks are listed
below:
External risks
· Geopolitical
· Legal and regulatory compliance
· Litigation
· Global macroeconomic developments
· Gold
price
Strategic risks
· Capital allocation and liquidity
· Diversification
· Concession governance and management
· Licence to operate
· People (attract, develop and retain skilled
people)
· Stakeholder environmental and social expectations
· Decarbonisation
Operational risks
· Safety, health and wellbeing
· Exploration and project development
· Maximising our geological potential
· Operational performance and planning
EMERGING RISKS
Below we have outlined a list of
emerging risks, these remain unchanged from those which are set out
within the Strategic Report section of the 2023 Annual Report
and
website:
· Cyber security
· Infectious disease
· Climate change
DIRECTORS' RESPONSIBILITY STATEMENT
RESPONSIBILITY STATEMENT OF THE DIRECTORS IN RESPECT OF THE
SIX MONTHS ENDED 30 JUNE 2024 FINANCIAL REPORT
The Directors confirm that to the
best of their knowledge:
a)
|
the set of interim condensed
consolidated financial statements for the six months ended 30 June
2024 has been prepared in accordance with International Accounting
Standard 34 'Interim Financial
Reporting' as adopted by the European Union;
|
b)
|
the set of interim condensed
consolidated financial statements, which has been prepared in
accordance with the
applicable set of accounting
standards, gives a true and fair view of the assets, liabilities,
financial position and profit
or loss of the issuer, or the
undertakings included in the consolidation as a whole as required
by DTR 4.2.4;
|
c)
|
the interim management report
includes a fair review of the information required by DTR 4.2.7R
(indication of important events during the first six months and
description of principal risks and uncertainties for the remaining
six months of the year); and
|
d)
|
the interim management report
includes a fair review of the information required by DTR 4.2.8R
(disclosure of related parties' transactions and changes
therein).
|
The board of Directors that served
during all or part of the six month period ended on 30 June 2024
and their respective responsibilities can be found on pages 84 to
130 of the 2023 annual report and financial statements of Centamin
plc. There has been no changes to board of Directors since the
approval of the 2023 Annual Report.
By order of the Board,
Martin Horgan
Ross
Jerrard
CEO
CFO
25 July
2024
25 July
2024
UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS
FOR THE SIX MONTHS ENDED
30
JUNE 2024
Independent review report to Centamin plc
Report on the interim condensed consolidated financial
statements
Our conclusion
We have reviewed Centamin plc's
interim condensed consolidated financial statements (the "interim
financial statements") in the Interim Report of Centamin plc for
the 6 month period ended 30 June 2024 (the
"period").
Based on our review, nothing has
come to our attention that causes us to believe that the interim
financial statements are not prepared, in all material respects, in
accordance with International Accounting Standard 34, 'Interim
Financial Reporting' as adopted by the European Union and the
Disclosure Guidance and Transparency Rules sourcebook of the United
Kingdom's Financial Conduct Authority.
The interim financial statements
comprise:
●
the unaudited interim condensed consolidated
statement of financial position as at
30 June 2024;
●
the unaudited interim condensed consolidated
statement of comprehensive income for the period then
ended;
●
the unaudited interim condensed consolidated
statement of changes in equity for the period then
ended;
●
the unaudited interim condensed consolidated
statement of cash flows for the period then ended; and
●
the explanatory notes to the interim financial
statements.
The interim financial statements
included in the Interim Report of Centamin plc have been prepared
in accordance with International Accounting Standard 34, 'Interim
Financial Reporting' as adopted by the European Union and the
Disclosure Guidance and Transparency Rules sourcebook of the United
Kingdom's Financial Conduct Authority.
Basis for conclusion
We conducted our review in
accordance with International Standard on Review Engagements (UK)
2410, 'Review of Interim Financial Information Performed by the
Independent Auditor of the Entity' issued by the Financial
Reporting Council for use in the United Kingdom ("ISRE (UK) 2410").
A review of interim financial information consists of making
enquiries, primarily of persons responsible for financial and
accounting matters, and applying analytical and other review
procedures.
A review is substantially less in
scope than an audit conducted in accordance with International
Standards on Auditing (UK) and, consequently, does not enable us to
obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do
not express an audit opinion.
We have read the other information
contained in the Interim Report and considered whether it contains
any apparent misstatements or material inconsistencies with the
information in the interim financial statements.
Conclusions relating to going concern
Based on our review procedures,
which are less extensive than those performed in an audit as
described in the Basis for conclusion section of this report,
nothing has come to our attention to suggest that the Directors
have inappropriately adopted the going concern basis of accounting
or that the Directors have identified material uncertainties
relating to going concern that are not appropriately disclosed.
This conclusion is based on the review procedures performed in
accordance with ISRE (UK) 2410. However, future events or
conditions may cause the Group to cease to continue as a going
concern.
Responsibilities for the interim financial statements and the
review
Our responsibilities and those of the
Directors
The Interim Report, including the
interim financial statements, is the responsibility of, and has
been approved by the Directors. The Directors are responsible for
preparing the Interim Report in accordance with the Disclosure
Guidance and Transparency Rules sourcebook of the United Kingdom's
Financial Conduct Authority. In preparing the Interim Report,
including the interim financial statements, the Directors are
responsible for assessing the Group's ability to continue as a
going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless the
Directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do
so.
Our responsibility is to express a
conclusion on the interim financial statements in the Interim
Report based on our review. Our conclusion, including our
Conclusions relating to going concern, is based on procedures that
are less extensive than audit procedures, as described in the Basis
for conclusion paragraph of this report. This report, including the
conclusion, has been prepared for and only for the Company for the
purpose of complying with the Disclosure Guidance and Transparency
Rules sourcebook of the United Kingdom's Financial Conduct
Authority and for no other purpose. We do not, in giving this
conclusion, accept or assume responsibility for any other purpose
or to any other person to whom this report is shown or into whose
hands it may come save where expressly agreed by our prior consent
in writing.
PricewaterhouseCoopers
LLP
Chartered Accountants
London
25 July 2024
Unaudited interim condensed consolidated statement of
comprehensive income
for the six months ended 30 June
2024
|
|
Half year
ended
30 June
|
Half
year
ended
30 June
|
Year
ended 31 December
|
|
|
|
2024
(Unaudited)
|
2023
(Unaudited)
|
2023
(Audited)
|
|
|
Notes
|
US$'000
|
US$'000
|
US$'000
|
|
Revenue
|
2.1
|
465,095
|
425,612
|
891,262
|
|
Cost of sales
|
2.2
|
(295,091)
|
(267,801)
|
(596,836)
|
|
Gross profit
|
|
170,004
|
157,811
|
294,426
|
|
Exploration and evaluation
expenditure
|
|
(12,071)
|
(18,923)
|
(31,653)
|
|
Other operating costs
|
2.2
|
(42,084)
|
(29,602)
|
(68,542)
|
|
Other income
|
|
1,007
|
4,617
|
5,817
|
|
Finance income
|
2.2
|
3,126
|
1,791
|
4,127
|
|
Finance costs
|
2.2
|
(2,179)
|
(1,380)
|
(3,526)
|
|
Fair value (loss)/gain on derivative
financial instruments
|
2.3
|
(654)
|
490
|
(5,509)
|
|
Profit for the period before tax
|
|
117,149
|
114,804
|
195,140
|
|
Tax
|
|
(120)
|
(10)
|
(255)
|
|
Profit for the period after tax
|
|
117,029
|
114,794
|
194,885
|
|
Profit for the period after tax attributable
to:
|
|
|
|
|
|
- the owners of the
parent
|
|
83,356
|
90,968
|
92,284
|
|
- non-controlling interest in
SGM
|
2.4
|
33,673
|
23,826
|
102,601
|
|
Total comprehensive income for the period
|
|
117,029
|
114,794
|
194,885
|
|
Total comprehensive income for the period attributable
to:
|
|
|
|
|
|
- the owners of the
parent
|
|
83,356
|
90,968
|
92,284
|
|
- non-controlling interest in
SGM
|
2.4
|
33,673
|
23,826
|
102,601
|
|
Earnings per share attributable to owners of the
parent:
|
|
|
|
|
Basic (US cents per
share)
|
|
7.189
|
7.860
|
7.970
|
|
Diluted (US cents per
share)
|
|
7.080
|
7.728
|
7.817
|
|
|
|
|
|
|
|
|
| |
The above unaudited interim
condensed consolidated statement of comprehensive income should be
read in conjunction with the accompanying notes.
Unaudited interim CONDENSED consolidated STATEMENT OF
Financial position
as at 30 June 2024
|
|
30 June
|
30
June
|
31 December
|
|
|
2024
(Unaudited)
|
2023
(Unaudited)
|
2023
(Audited)
|
|
Notes
|
US$'000
|
US$'000
|
US$'000
|
Non‑current
assets
|
|
|
|
|
Property, plant and
equipment
|
2.5
(a)
|
1,076,104
|
1,114,000
|
1,084,019
|
Exploration and evaluation
asset
|
2.6
|
24,809
|
24,809
|
24,809
|
Inventories
|
2.7
|
120,594
|
110,337
|
103,121
|
Other receivables
|
|
-
|
1,582
|
1,014
|
Total non‑current
assets
|
|
1,221,507
|
1,250,728
|
1,212,963
|
Current assets
|
|
|
|
|
Inventories
|
2.7
|
139,259
|
112,067
|
149,457
|
Trade and other
receivables
|
|
45,699
|
39,259
|
49,443
|
Prepayments
|
|
22,230
|
13,114
|
17,404
|
Derivative financial
instruments
|
2.3
|
-
|
3,028
|
654
|
Cash and cash
equivalents
|
2.10(a)
|
109,607
|
96,231
|
93,322
|
Total current assets
|
|
316,795
|
263,699
|
310,280
|
Total assets
|
|
1,538,302
|
1,514,427
|
1,523,243
|
Non‑current
liabilities
|
|
|
|
|
Provisions
|
2.8
|
40,892
|
38,064
|
40,039
|
Other payables
|
2.9
|
5,138
|
8,814
|
8,264
|
Total non‑current
liabilities
|
|
46,030
|
46,878
|
48,303
|
Current liabilities
|
|
|
|
|
Trade and other
payables
|
2.9
|
89,409
|
80,966
|
94,248
|
Tax liabilities
|
|
53
|
259
|
102
|
Employee benefit
liabilities
|
|
1,885
|
-
|
-
|
Provisions
|
2.8
|
664
|
2,954
|
1,984
|
Total current liabilities
|
|
92,011
|
84,179
|
96,334
|
Total liabilities
|
|
138,041
|
131,057
|
144,637
|
Net assets
|
|
1,400,261
|
1,383,370
|
1,378,606
|
Equity
|
|
|
|
|
Issued capital
|
|
679,316
|
673,527
|
673,432
|
Share option reserve
|
|
6,081
|
5,818
|
10,124
|
Accumulated profits
|
|
742,053
|
703,662
|
681,912
|
Total equity attributable to owners of the
parent
|
|
1,427,450
|
1,383,007
|
1,365,468
|
Non-controlling interest in
SGM
|
|
(27,189)
|
363
|
13,138
|
Total equity
|
|
1,400,261
|
1,383,370
|
1,378,606
|
The above unaudited interim
condensed consolidated statement of financial position should be
read in conjunction with the accompanying notes.
The unaudited interim condensed
consolidated financial statements were authorised by the Board of
Directors for issue on 25 July 2024
and signed on its behalf by:
Martin
Horgan
Ross Jerrard
CEO, Director
CFO, Director
25 July
2024
25 July 2024
Unaudited interim condensed consolidated statement of changes
in equity
for the six months ended 30 June
2024
30 June 2024 (Unaudited)
|
|
Issued
capital
|
Share option
reserve
|
Accumulated
profits
|
Total
|
Non-controlling
interests
|
Total
equity
|
|
Notes
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
Balance as at 1 January 2024
|
|
673,432
|
10,124
|
681,912
|
1,365,468
|
13,138
|
1,378,606
|
Profit for the period after
tax
|
|
-
|
-
|
83,356
|
83,356
|
33,673
|
117,029
|
Total comprehensive income for the period
|
|
-
|
-
|
83,356
|
83,356
|
33,673
|
117,029
|
Net recognition of share-based
payments
|
|
-
|
1,841
|
-
|
1,841
|
-
|
1,841
|
Transfer of share-based
payments
|
|
5,884
|
(5,884)
|
-
|
-
|
-
|
-
|
Dividend paid - non-controlling
interest in SGM
|
2.4
|
-
|
-
|
-
|
-
|
(74,000)
|
(74,000)
|
Dividend paid - owners of the
parent
|
|
-
|
-
|
(23,209)
|
(23,209)
|
-
|
(23,209)
|
Balance as at 30 June 2024
|
|
679,316
|
6,081
|
742,053
|
1,427,456
|
(27,189)
|
1,400,261
|
30 June 2023 (Unaudited)
|
|
Issued
capital
|
Share option
reserve
|
Accumulated
profits
|
Total
|
Non-controlling
interests
|
Total
equity
|
|
Notes
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
Balance as at 1 January 2023
|
|
670,994
|
6,082
|
641,794
|
1,318,870
|
22,537
|
1,341,407
|
Profit for the period after
tax
|
|
-
|
-
|
90,968
|
90,968
|
23,826
|
114,794
|
Total comprehensive income for the period
|
|
-
|
-
|
90,968
|
90,968
|
23,826
|
114,794
|
Net recognition of share-based
payments
|
|
-
|
2,269
|
-
|
2,269
|
-
|
2,269
|
Transfer of share-based
payments
|
|
2,533
|
(2,533)
|
-
|
-
|
-
|
-
|
Dividend paid - non-controlling
interest in SGM
|
2.4
|
-
|
-
|
-
|
-
|
(46,000)
|
(46,000)
|
Dividend paid - owners of the
parent
|
|
-
|
-
|
(29,100)
|
(29,100)
|
-
|
(29,100)
|
Balance as at 30 June 2023
|
|
673,527
|
5,818
|
703,662
|
1,383,007
|
363
|
1,383,370
|
31 December 2023 (Audited)
|
|
Issued
capital
|
Share option
reserve
|
Accumulated
profits
|
Total
|
Non-controlling
interests
|
Total
equity
|
|
Notes
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
Balance as at 1 January 2023
|
|
670,994
|
6,082
|
641,794
|
1,318,870
|
22,537
|
1,341,407
|
Profit for the year after
tax
|
|
-
|
-
|
92,284
|
92,284
|
102,601
|
194,885
|
Total comprehensive income for the year
|
|
-
|
-
|
92,284
|
92,284
|
102,601
|
194,885
|
Own shares acquired
|
|
(245)
|
-
|
-
|
(245)
|
-
|
(245)
|
Net recognition of share-based
payments
|
|
-
|
6,725
|
-
|
6,725
|
-
|
6,725
|
Transfer of share-based
payments
|
|
2,683
|
(2,683)
|
-
|
-
|
-
|
-
|
Dividend paid - non-controlling
interest in SGM
|
2.4
|
-
|
-
|
-
|
-
|
(112,000)
|
(112,000)
|
Dividend paid - owners of the
parent
|
|
-
|
-
|
(52,166)
|
(52,166)
|
-
|
(52,166)
|
Balance as at 31 December 2023
|
|
673,432
|
10,124
|
681,912
|
1,365,468
|
13,138
|
1,378,606
|
The above unaudited interim
condensed consolidated statement of changes in equity should be
read in conjunction with the accompanying notes.
unaudited interim condensed consolidated statement of cash
flows
for the six months ended 30 June
2024
|
|
Half year
ended
30 June
|
Half
year
ended
30 June
|
Year
ended
31 December
|
|
|
2024
(Unaudited)
|
2023
(Unaudited)
|
2023
(Audited)
|
|
Notes
|
US$'000
|
US$'000
|
US$'000
|
Cash flows from operating activities
|
|
|
|
|
Cash generated from operating
activities
|
2.10(b)
|
204,951
|
172,479
|
356,195
|
Income tax paid
|
|
(68)
|
-
|
(402)
|
Interest paid
|
|
(1,474)
|
(712)
|
(2,193)
|
Net
cash generated from operating activities
|
|
203,409
|
171,767
|
353,600
|
Cash flows from investing activities
|
|
|
|
|
Acquisition of property, plant and
equipment
|
|
(85,758)
|
(101,618)
|
(190,723)
|
Brownfield exploration and
evaluation expenditure
|
|
(3,884)
|
(6,578)
|
(12,172)
|
Finance income
|
2.2
|
2,976
|
1,791
|
4,127
|
Net
cash used in investing activities
|
|
(86,666)
|
(106,405)
|
(198,768)
|
Cash flows from financing activities
|
|
|
|
|
Cash element of share-based
payments
|
|
(1,407)
|
(583)
|
(583)
|
Principal element of lease
payments
|
|
(1,024)
|
-
|
-
|
Own shares acquired
|
|
-
|
-
|
(245)
|
Notes payable
|
|
53
|
-
|
-
|
Dividend paid - non-controlling
interest in SGM
|
2.4
|
(74,000)
|
(46,000)
|
(112,000)
|
Dividend paid - owners of the
parent
|
|
(23,209)
|
(29,100)
|
(52,166)
|
Net
cash used in financing activities
|
|
(99,587)
|
(75,683)
|
(164,994)
|
Net
increase/(decrease) in cash and cash equivalents
|
|
17,158
|
(10,321)
|
(10,163)
|
Cash and cash equivalents at the beginning of the
period
|
|
93,322
|
102,373
|
102,373
|
Effect of foreign exchange rate
changes
|
|
(873)
|
4,179
|
1,112
|
Cash and cash equivalents at the end of the
period
|
2.10(a)
|
109,607
|
96,231
|
93,322
|
The above unaudited interim
condensed consolidated statement of cash flows should be read in
conjunction with the accompanying notes.
notes to the unaudited interim condensed consolidated
financial statements
for the six months ended 30 June
2024
General information and basis of preparation of interim
report
1. Summary of material accounting
policies
1.1 Basis of
preparation
These unaudited interim condensed
consolidated financial statements ("interim financial statements")
have been prepared in accordance with IAS 34 "Interim Financial Reporting" (IAS 34)
as adopted by the European Union and the requirements of the
Disclosure and Transparency Rule sourcebook (DTR) of the Financial
Conduct Authority (FCA) in the United Kingdom as applicable to
interim financial reporting. These unaudited interim condensed
consolidated financial statements are not affected by
seasonality.
The unaudited interim condensed
consolidated financial statements represent a 'condensed set of
financial statements' as referred to in the DTR issued by the FCA.
Accordingly, they do not include all of the information required
for a full annual financial report and are to be read in
conjunction with the Group's financial statements for the year
ended 31 December 2023, which were prepared in accordance with
International Financial Reporting Standards ("IFRS") as adopted for
use by the European Union. The financial statements for the year
ended 31 December 2023 have been filed with the Jersey Financial
Services Commission. The financial information contained in this
report does not constitute statutory accounts under the Companies
(Jersey) Law 1991, as amended.
The financial information for the
year ended 31 December 2023 is based on the statutory accounts for
the year ended 31 December 2023. Readers are referred to the
auditors' report on the Group financial statements as at 31
December 2023 (available at www.centamin.com).
The accounting policies applied in
these interim financial statements are consistent with those used
in the annual consolidated financial statements for the year ended
31 December 2023 except for the adoption of new standards, endorsed
by the EU, which apply for the first time in 2024 as referred to in
the 31 December 2023 Annual Report. The Group has not early adopted
any amendments, standards or interpretations that have been issued
but are not yet effective.
The preparation of these interim
condensed consolidated financial statements requires the use of
certain significant accounting estimates and judgements by
management in applying the Group's accounting policies. There have
been no changes to areas as set out in Note 1 of the Group's annual
audited consolidated financial statements for the year ended 31
December 2023 involving significant judgement and
estimates.
1.2 Going
concern
Management performed detailed
analyses and forecasts to assess the economic impact of a base case
and various downside scenarios from a going concern and viability
perspective as at 31 December 2023. Based on the financial and
operational performance analysis and review done for the six-month
period to 30 June 2024 the Company is still operating within budget
and guidance in terms of production and costs. Additionally, as at
30 June 2024, management performed a similar base case and various
downside scenarios without applying any mitigating actions over an
18 month period from 1 July 2024 to 31 December 2025. The scenarios
modelled are as follows:
·
|
Base case scenario being the
financial model based on the budget;
|
·
|
Gold price reduction from current
levels to US$1,900/oz;
|
·
|
Fuel price increase to US$1 per
litre;
|
·
|
Open pit tonnage reduction by
2%;
|
·
|
Open pit grade reduction by
15%;
|
·
|
Underground tonnage reduction by
6%;
|
·
|
Underground grade reduction by
20%;
|
·
|
Processing capacity reduction by
2%;
|
·
|
Processing plant recovery rate
reduction to 87%; and
|
·
|
A worst-case scenario with a
combination of the above.
|
All the scenarios evaluated above
had a net ending positive cash outcome.
This base case analysis as at 30
June 2024 together with the downside scenarios analyses outlined
above, completed shortly after a detailed analysis to support the
year end going concern assessment, was sufficient to give the
Directors comfort that the Company's financial statements for the
six months ended 30 June 2024 should be prepared on a going concern
basis.
However, the Group continues to
monitor the business' major cost drivers e.g., fuel and other key
consumables and reagents as well as key operational KPIs that may
have an impact on going concern and take mitigating actions where
necessary. The Group continues to benefit from a strong balance
sheet with large cash balances and no debt. At 30 June 2024 the
Group had cash and cash equivalents of US$110 million (30 June
2023: US$96 million). The Group also had access to US$150 million
of liquidity through the undrawn RCF which is not modelled to be
drawn down under any of the scenarios described above.
These financial statements for the
six month period ended 30 June 2024 have therefore been prepared on
a going concern basis, which contemplate the realisation of assets
and liquidation of liabilities during the normal course of
operations.
1.3 Changes in critical
judgements and estimates in applying the entities accounting
policies
There were no updates and/or
changes to critical accounting judgements and estimates that
management have made in the period in applying the Group's
accounting policies, that have a significant effect on the amounts
recognised and the disclosure of such amounts in the financial
statements. Refer to the 2023 Annual Report for applicable critical
accounting judgements or estimates.
1.4 Changes in policies
and estimates
There were no changes in policies
and estimates during the reporting period.
1.5 New and amended
standards and their impact to the Group
A number of new or amended
standards became applicable for the current reporting period. Where
the new or amended standards were currently applicable, the Group
did not have to change its accounting policies or make
retrospective adjustments as a result of adopting these standards.
Refer to the table below for details of these standards.
Accounting Standard
|
Requirement
|
Effective date
|
IFRS 18, Presentation and disclosure in financial
statements'
|
This standard requires entities to
set out requirements for the presentation and disclosure of
information in general purpose financial statements (financial
statements) to help ensure they provide relevant information that
faithfully represents an entity's assets, liabilities, equity,
income and expenses.
|
Effective for periods beginning on
or after 1 January 2027*
|
IFRS 19, Subsidiaries without Public Accountability:
Disclosures
|
The objective of this standard is
to specify the disclosure requirements an entity is permitted to
apply instead of the disclosure requirements in other IFRS
Accounting Standards.
|
Effective for periods beginning on
or after 1 January 2027*
|
*The accounting standards outlined
above have not yet been endorsed by the EU
1.6 Tax: Global implementation
of OECD Pillar Two model rules
In December 2021, the Organisation
for Economic Co-operation and Development ("OECD") published Tax
Challenges Arising from the Digitalisation of the Economy - Global
Anti-Base Erosion Model Rules (Pillar Two): Inclusive Framework on
BEPS, hereafter referred to as the 'OECD Pillar Two model rules' or
'the rules'. The rules are designed to ensure that large
multinational enterprises within the scope of the rules pay a
minimum level of tax on the income arising in a specific period in
each jurisdiction where they operate. In general, the rules apply a
system of top-up taxes that brings the total amount of taxes paid
in a jurisdiction up to the minimum rate of 15%.
The rules need to be passed into
national legislation based on each country's approach. Pillar Two
legislation has not yet been enacted in Jersey; however, the
Treasury Minister of Jersey, the Company's country of
incorporation, has announced their intentions in relation to Pillar
Two implementation. They intend to implement an Income Inclusion
Rule ("IIR") and a Multinational Corporate Income Tax ("MCIT") with
effect for accounting periods commencing on or after 1 January
2025, while continuing to monitor global implementation. The rules
will impact current income tax when the legislation comes into
effect.
When enacted, applying the OECD
Pillar Two model rules as introduced by the relevant jurisdictions
in which the Group operates, and determining their impact on the
Group's financial statements will be complex and poses a number of
practical challenges. However, since the Pillar Two legislation
does not apply to the Group in 2024, the Group has no related
current tax exposure at the reporting date.
The Group expect to be in scope of
the OECD Pillar Two model rules from 2025 onwards based on current
forecasts of revenue and would therefore expect the IIR to apply in
Jersey (as the place of residence of the Group's ultimate parent
entity). It is currently in the process of performing an assessment
of the potential impact on the Group, including through a process
of engagement with the relevant tax authorities and the Group's tax
advisors.
The Group makes significant profit
share payments to EMRA, an Egyptian government body (refer to note
2.4 (a) for further information). The Group's view is that these
profit share payments, which are prescribed by the Sukari
Concession Agreement and paid periodically to an Egyptian
governmental organisation, are "…imposed in lieu of a generally
applicable corporate income tax" and should constitute "Covered
Taxes" under Article 4.2.1 of the Pillar Two model rules. On
this basis, the Group does not expect to be liable for top-up taxes
under the rules upon their implementation and application to the
Group, but this remains subject to discussion with the relevant tax
authorities and the detailed implementation of the rules.
2. How numbers are calculated
2.1 Segment reporting
The Group is engaged in the
business of exploration for, and mining of, precious metals, which
represents three operating segments, two in the business of
exploration and one in the mining of precious metals. The Board is
the Group's chief operating decision-maker within the meaning of
IFRS 8 'Operating
segments'. Management has determined the operating segments
based on the information reviewed by the Board for the purposes of
allocating resources and assessing performance.
The Board considers the business
from a geographic perspective and a mining of precious metals
versus exploration for precious metals perspective. Geographically,
management considers separately the performance in Egypt, Burkina
Faso, Côte d'Ivoire and Corporate (which includes Jersey, United
Kingdom and Australia). From a mining of precious metals versus
exploration for precious metals perspective, management separately
considers the Egyptian mining of precious metals from the Egyptian
and West African exploration for precious metals in these
geographies. The Egyptian mining operations derive its revenue from
the sale of gold while the West African and the other Egyptian
exploration entities are currently only engaged in precious metal
exploration and do not produce any revenue.
The Board assesses the performance
of the operating segments based on profits and expenditure incurred
as well as exploration expenditure in each region. Egypt is the
only operating segment, with one of its entities, SGM, mining
precious metals and therefore has revenue and cost of sales whilst
the remaining operating segments do not. All operating segments are
reviewed by the Board as presented and are key to the monitoring of
ongoing performance and assessing the plans of the
Group.
Non‑current assets other than
financial instruments by country:
|
30
June
|
30
June
|
31
December
|
|
2024
(Unaudited)
|
2023
(Unaudited)
|
2023
(Audited)
|
|
US$'000
|
US$'000
|
US$'000
|
Egypt
|
1,220,188
|
1,249,357
|
1,210,391
|
Burkina Faso*
|
-
|
3
|
-
|
Côte d'Ivoire
|
385
|
1,035
|
537
|
Corporate
|
934
|
333
|
1,021
|
Total non-current
assets
|
1,221,507
|
1,250,728
|
1,211,949
|
*All Burkina Faso entities have
been liquidated
Additions to non-current assets
mainly relate to Egypt and are disclosed in the Property, Plant and
Equipment note 2.5.
Statement of financial position by operating
segment:
30 June 2024
|
Total
|
Egypt
Mining
|
Egypt
Exploration
|
Burkina
Faso*
|
Côte
d'Ivoire
|
Corporate
|
(Unaudited)
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
Statement of financial position
|
|
|
|
|
|
|
Total assets
|
1,538,302
|
1,437,108
|
4,439
|
-
|
5,213
|
91,542
|
Total liabilities
|
(138,041)
|
(117,891)
|
(1,007)
|
-
|
(1,515)
|
(17,628)
|
Net assets/total equity
|
1,400,261
|
1,319,217
|
3,432
|
-
|
3,698
|
73,914
|
*All Burkina Faso entities have
been liquidated
|
|
|
|
30 June 2023
|
Total
|
Egypt
Mining
|
Egypt
Exploration
|
Burkina
Faso
|
Côte
d'Ivoire
|
Corporate
|
(Unaudited)
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
Statement of financial position
|
|
|
|
|
|
|
Total assets
|
1,514,427
|
1,419,087
|
4,545
|
58
|
5,116
|
85,621
|
Total liabilities
|
(131,057)
|
(124,473)
|
(804)
|
(465)
|
(2,306)
|
(3,009)
|
Net assets/total equity
|
1,383,370
|
1,294,614
|
3,741
|
(407)
|
2,810
|
82,612
|
31 December 2023
|
Total
|
Egypt
Mining
|
Egypt
Exploration
|
Burkina
Faso
|
Côte
d'Ivoire
|
Corporate
|
(Audited)
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
Statement of financial position
|
|
|
|
|
|
|
Total assets
|
1,523,243
|
1,434,074
|
4,391
|
30
|
6,149
|
78,600
|
Total liabilities
|
(144,637)
|
(133,177)
|
(787)
|
-
|
(2,596)
|
(8,077)
|
Net assets/total equity
|
1,378,606
|
1,300,897
|
3,604
|
30
|
3,553
|
70,523
|
Statement of comprehensive income by operating
segment:
Half-year ended 30 June 2024
|
Total
|
Egypt
Mining
|
Egypt
Exploration
|
Burkina
Faso
|
Côte
d'Ivoire
|
Corporate
|
(Unaudited)*
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
Statement of comprehensive income
|
|
|
|
|
|
|
Gold sales
|
464,122
|
464,122
|
-
|
-
|
-
|
-
|
Silver sales
|
973
|
973
|
-
|
-
|
-
|
-
|
Revenue
|
465,095
|
465,095
|
-
|
-
|
-
|
-
|
Cost of sales
|
(295,091)
|
(295,091)
|
-
|
-
|
-
|
-
|
Gross profit
|
170,004
|
170,004
|
-
|
-
|
-
|
-
|
Exploration and evaluation
costs
|
(12,071)
|
-
|
(3,255)
|
-
|
(8,816)
|
-
|
Other operating
costs(1)
|
(42,084)
|
(23,236)
|
(666)
|
1,062
|
(471)
|
(18,773)
|
Other income
|
1,007
|
1,323
|
102
|
-
|
3,941
|
(4,359)
|
Fair value loss on derivative
financial instruments
|
(654)
|
-
|
-
|
-
|
-
|
(654)
|
Finance income
|
3,126
|
736
|
-
|
-
|
-
|
2,390
|
Finance costs
|
(2,179)
|
(948)
|
(20)
|
-
|
(35)
|
(1,176)
|
Profit/(loss) for the period before tax
|
117,149
|
147,879
|
(3,839)
|
1,062
|
(5,381)
|
(22,572)
|
Tax
|
(120)
|
(8)
|
(53)
|
-
|
(21)
|
(39)
|
Profit/(loss) for the period after tax
|
117,029
|
147,871
|
(3,892)
|
1,062
|
(5,402)
|
(22,610)
|
Profit/(loss) for the period after tax attributable
to:
|
|
|
|
|
|
|
- owners of the parent
(2)
|
83,356
|
114,198
|
(3,892)
|
1,062
|
(5,402)
|
(22,610)
|
- non-controlling interest in SGM
(2)
|
33,673
|
33,673
|
-
|
-
|
-
|
-
|
(1) The US$1m
gain in the Burkina Faso segment relates to intercompany loans due
to Centamin West Africa Holdings Limited (included as an expense
within the Corporate segment) that were written off in the 6 months
period ended 30 June 2024. These amounts are fully eliminated on
consolidation, therefore do not impact the overall Group
results.
(2) Please note that the cost recovery model on which profit share
is based under the Concession Agreement is different to the
accounting results presented above due to various adjustments and
as such the share of profit disclosed above is not reflective of
the 55%:45% split that was in place from 1 July 2018 to 30 June
2020 and the 50%:50% split from 1 July 2020 onwards that
occurs in practice.
Statement of comprehensive income by operating
segment:
Half-year ended 30 June 2023
|
Total
|
Egypt
Mining
|
Egypt
Exploration
|
Burkina Faso
|
Côte
d'Ivoire
|
Corporate
|
(Unaudited)
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
Statement of comprehensive income
|
|
|
|
|
|
|
Gold sales
|
424,684
|
424,684
|
-
|
-
|
-
|
-
|
Silver sales
|
928
|
928
|
-
|
-
|
-
|
-
|
Revenue
|
425,612
|
425,612
|
-
|
-
|
-
|
-
|
Cost of sales
|
(267,801)
|
(267,801)
|
-
|
-
|
-
|
-
|
Gross profit
|
157,811
|
157,811
|
-
|
-
|
-
|
-
|
Exploration and evaluation
costs
|
(18,923)
|
-
|
(2,234)
|
(775)
|
(15,914)
|
-
|
Other operating
costs(1)
|
(29,602)
|
(15,397)
|
(126)
|
687
|
(240)
|
(14,526)
|
Other income
|
4,617
|
4,788
|
102
|
108
|
(354)
|
(27)
|
Net fair value gain on derivative
financial instruments
|
490
|
-
|
-
|
-
|
-
|
490
|
Finance income
|
1,791
|
563
|
-
|
-
|
-
|
1,228
|
Finance costs
|
(1,380)
|
(781)
|
(12)
|
(1)
|
(21)
|
(565)
|
Profit/(loss) for the period before tax
|
114,804
|
146,984
|
(2,270)
|
19
|
(16,529)
|
(13,400)
|
Tax
|
(10)
|
(10)
|
-
|
-
|
-
|
-
|
Profit/(loss) for the period after tax
|
114,794
|
146,974
|
(2,270)
|
19
|
(16,529)
|
(13,400)
|
Profit/(loss) for the period after tax attributable
to:
|
|
|
|
|
|
|
- owners of the parent
(2)
|
90,968
|
123,148
|
(2,270)
|
19
|
(16,529)
|
(13,400)
|
- non-controlling interest in SGM
(2)
|
23,826
|
23,826
|
-
|
-
|
-
|
-
|
(1) The US$0.7m
gain in the Burkina Faso segment relates to intercompany loans due
to Centamin West Africa Holdings Limited (included as an expense
within the Corporate segment) that were written off in the 6 months
period ended 30 June 2023. These amounts are fully eliminated on
consolidation, therefore do not impact the overall Group
results.
(2) Please note
that the cost recovery model on which profit share is based under
the Concession Agreement is different to the accounting results
presented above due to various adjustments and as such the share of
profit disclosed above is not reflective of the 55%:45% split that
was in place from 1 July 2018 to 30 June 2020 and the 50%:50% split
from 1 July 2020 onwards that occurs in
practice.
Statement of comprehensive income by operating
segment:
Full-year ended 31 December
2023
|
Total
|
Egypt
Mining
|
Egypt Exploration
|
Burkina
Faso
|
Côte
d'Ivoire
|
Corporate
|
(Audited)
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
Statement of comprehensive income
|
|
|
|
|
|
|
Revenue
|
891,262
|
891,262
|
-
|
-
|
-
|
-
|
Cost of sales
|
(596,836)
|
(596,836)
|
-
|
-
|
-
|
-
|
Gross profit
|
294,426
|
294,426
|
-
|
-
|
-
|
-
|
Exploration and evaluation
costs
|
(31,653)
|
-
|
(5,558)
|
(869)
|
(25,226)
|
-
|
Other operating
costs(1)
|
(68,542)
|
(39,069)
|
(377)
|
1,221
|
(127)
|
(30,190)
|
Other income
|
5,817
|
6,058
|
99
|
102
|
1,686
|
(2,128)
|
Finance income
|
4,127
|
1,475
|
-
|
-
|
-
|
2,652
|
Finance costs
|
(3,526)
|
(1,681)
|
(42)
|
2
|
(75)
|
(1,730)
|
Net fair value loss on
derivatives
|
(5,509)
|
-
|
-
|
-
|
-
|
(5,509)
|
Profit/(loss) for the year before tax
|
195,140
|
261,209
|
(5,878)
|
456
|
(23,742)
|
(36,905)
|
Tax
|
(255)
|
(220)
|
-
|
-
|
(21)
|
(14)
|
Profit/(loss) for the year after tax
|
194,885
|
260,989
|
(5,878)
|
456
|
(23,763)
|
(36,919)
|
Profit/(loss) for the year after tax attributable
to:
|
|
|
|
|
|
|
- owners of the parent
(2)
|
92,284
|
158,388
|
(5,878)
|
456
|
(23,763)
|
(36,919)
|
- non-controlling interest in SGM
(2)
|
102,601
|
102,601
|
-
|
-
|
-
|
-
|
(1) The US$1.2m gain
in the Burkina Faso segment relates to intercompany loans due to
Centamin West Africa Holdings Limited (included as an expense
within the corporate segment) that were written off in the year.
These amounts are fully eliminated on consolidation, therefore do
not impact the overall Group results
(2)
Please note that the cost recovery model on which
profit share is based under the Concession Agreement is different
to the accounting results presented above due to various
adjustments and as such the share of profit disclosed above is not
reflective of the 55%:45% split that was in place from 1 July 2018
to 30 June 2020 and 50%:50% split from 1 July 2020 onwards that
occurs in practice, refer to the statement of cash flows by
operating segment below for further information
All gold and silver sales during
the period were made to a single customer in Switzerland, MKS Pamp
SA ("MKS").
Exploration expenditure by operating
segment
The following table provides a
breakdown of the total exploration expenditure of the Group by
operating segment:
|
30 June
2024
(Unaudited)
|
30
June
2023
(Unaudited)
|
31
December 2023
(Audited)
|
|
US$'000
|
US$'000
|
US$'000
|
Côte d'Ivoire
|
8,816
|
15,914
|
25,226
|
Egypt - Exploration
|
3,255
|
2,234
|
5,558
|
Burkina Faso
|
-
|
775
|
869
|
Exploration expenditure - greenfield
|
12,071
|
18,923
|
31,653
|
|
|
|
|
Egypt - Mining
|
3,884
|
6,578
|
12,172
|
Exploration expenditure - brownfield
|
3,884
|
6,578
|
12,172
|
|
|
|
|
Total exploration
expenditure
|
15,955
|
25,501
|
43,825
|
2.2 Profit before tax
Profit for the period has been
arrived at after crediting/(charging) the following gains/(losses)
and income/(expenses):
|
30
June
2024
(Unaudited)
|
30
June
2023
(Unaudited)
|
31
December 2023
(Audited)
|
|
US$'000
|
US$'000
|
US$'000
|
Other income
|
|
|
|
Net foreign exchange
gains
|
977
|
4,464
|
5,641
|
Other income
|
30
|
153
|
176
|
|
1,007
|
4,617
|
5,817
|
|
|
|
|
Finance income
|
3,126
|
1,791
|
4,127
|
Finance costs
|
(2,179)
|
(1,380)
|
(3,526)
|
|
|
|
|
Net fair value (loss)/gain on
derivative financial instruments
|
(654)
|
490
|
(5,509)
|
Expenses
|
|
|
|
Cost of sales*
|
|
|
|
Mine production costs
|
(219,407)
|
(188,344)
|
(412,827)
|
Movement in inventory
|
17,893
|
(716)
|
13,319
|
Depreciation and
amortisation
|
(93,577)
|
(78,741)
|
(197,328)
|
|
(295,091)
|
(267,801)
|
(596,836)
|
Other operating costs
|
|
|
|
Corporate compliance
|
(1,190)
|
(2,248)
|
(3,961)
|
Fees payable to the external
auditors
|
(738)
|
(465)
|
(1,080)
|
Corporate consultants'
fees
|
(770)
|
(2,581)
|
(4,301)
|
Salaries and wages
|
(8,572)
|
(5,605)
|
(12,434)
|
Employee share-based
payments
|
(5,132)
|
(2,852)
|
(7,308)
|
Other administration
expenses
|
(2,057)
|
(1,212)
|
(4,026)
|
Corporate costs (sub-total)
|
(18,459)
|
(14,963)
|
(33,110)
|
Royalty - attributable to the ARE
government
|
(13,931)
|
(12,733)
|
(26,682)
|
Net movement on provision for
stock obsolescence
|
(5,694)
|
419
|
4,004
|
Loss on retirement of fixed
assets
|
(3,604)
|
(1,855)
|
(9,415)
|
Inventory written-off
|
-
|
-
|
(3,721)
|
Other provisions
|
(51)
|
29
|
1,182
|
Other non-corporate operating
expenses
|
(345)
|
(499)
|
(800)
|
|
(42,084)
|
(29,602)
|
(68,542)
|
* Inventories recognised as an expense in the
Consolidated Statement of Comprehensive Income during the half year
ended 30 June 2024 amounted to US$295 million (30 June 2023: US$
268 million) and these were included in 'cost of sales'
.
2.3 Derivative financial instruments
On 14 June 2023, the Company
entered into put option contracts whereby it purchased a series of
gold put option contracts (the "commodity contracts"). A total of
US$2.5 million, was paid to BMO, the counterparty as a premium on
entering into six put option contracts for a total of 120,000
ounces representing, 20,000 ounces for each month beginning 1 July
2023 to 31 December 2023 at a strike price of US$1,900/oz as part
of the Gold Price Protection Programme. As part of the same
programme, on 20 July 2023, the Company entered into a second
series of six put option contracts for a total of 120,000 ounces
representing, 20,000 ounces for each month beginning 1 January 2024
to 30 June 2024 at a strike price of US$1,900/oz and a total of
US$3.6 million, was paid to HSBC, the counterparty as a premium on
entering into the contracts. By entering into these contracts, the
Company was able to ensure that it reasonably protected the Group's
cash flows by initiating a gold price protection programme for the
contracted ounces at these prices over the 12 month period to 30
June 2024.
There were no open or outstanding
contracts as at 30 June 2024. These derivative instruments were not
designated as hedges by the Company and were marked-to-market at
the end of each reporting period with the mark-to-market adjustment
recorded in the consolidated income statement.
The full carrying value of the
options as at 31 December 2023 of US$653,538 was crystallised to
realised losses in the income statement in the half year period
ended 30 June 2024 as the average gold price over the period
covered by the six 2024 contracts was consistently above the strike
price.
The commodity contracts were
marked-to-market using a valuation model which uses quoted
observable inputs and are classified as Level 2 in the fair value
hierarchy.
2.4 Non-controlling interest in SGM
EMRA is a 50% shareholder in SGM
and is entitled to a share of 50% of SGM's net production surplus
which can be defined as 'revenue less payment of the fixed royalty
to the Arab Republic of Egypt (ARE) and recoverable
costs'.
Earnings attributable to the
non-controlling interest in SGM (i.e., EMRA) are pursuant to the
provisions of the Concession Agreement (CA) and are recognised as
profit attributable to the non-controlling interest in SGM in the
attribution of profit section of the statement of comprehensive
income of the Group. The profit share payments during the year will
be reconciled against SGM's audited financial statements. The SGM
financial statements for the year ended 30 June 2024 will be
audited in due course in line with the agreed timetable.
Certain terms of the CA and
amounts in the cost recovery model may also vary depending on
interpretation and are therefore subject to continued discussions
between EMRA and management which can result in variations in the
profit sharing split between periods and therefore the timing and
distribution of proceeds between partners.
a)
Statement of
comprehensive income and statement of financial position
impact
|
30 June
2024
(Unaudited)
|
30
June
2023
(Unaudited)
|
31
December 2023
(Audited)
|
|
US$'000
|
US$'000
|
US$'000
|
Statement of comprehensive income
|
|
|
|
Profit for the period after tax
attributable to the non-controlling interest in
SGM(1)
|
33,673
|
23,826
|
102,601
|
Statement of financial position
|
|
|
|
Total equity attributable to the
non-controlling interest in SGM(1) (opening)
|
13,138
|
22,537
|
22,537
|
Profit for the period after tax
attributable to the non-controlling interest in
SGM(1)
|
33,673
|
23,826
|
102,601
|
Dividend paid - non-controlling
interest in SGM
|
(74,000)
|
(46,000)
|
(112,000)
|
Total equity attributable to the non-controlling interest in
SGM(1) (closing)
|
27,189
|
363
|
13,138
|
(1) Profit share
commenced during the third quarter of 2016. The first two years was
a 60:40 split of net production surplus to PGM and EMRA
respectively. From 1 July 2018 this changed to a 55:45 split for
the next two-year period until 30 June 2020, after which all net
production surpluses will be split 50:50.
Any variation between payments
made during the year (which are based on the Company's estimates)
and the SGM audited financial statements, may result in a balance
due and payable to EMRA or advances to be offset against future
distributions. This will be reflected as an amount attributable to
the NCI in SGM in the statement of financial position and statement
of changes in equity.
b) Statement of cash flow
impact
|
30 June
2024
(Unaudited)
|
30
June
2023
(Unaudited)
|
31
December 2023
(Audited)
|
|
US$'000
|
US$'000
|
US$'000
|
Statement of cash flows
|
|
|
|
Dividend paid - non-controlling
interest in SGM(1)
|
(74,000)
|
(46,000)
|
(112,000)
|
(2) Profit share
commenced during the third quarter of 2016. The first two years was
a 60:40 split of net production surplus to PGM and EMRA
respectively. From 1 July 2018 this changed to a 55:45 split for
the next two-year period until 30 June 2020, after which all net
production surpluses will be split 50:50.
EMRA and PGM benefit from advance
distributions of profit share which are made on a weekly or
fortnightly basis and proportionately in accordance with the terms
of the CA. Future distributions will take into account ongoing cash
flows, historical costs that are still to be recovered and any
future capital expenditure. All profit share payments will be
reconciled against SGM's audited June financial statements for
current and future periods.
2.5 (a) Property, plant and equipment
|
|
|
|
|
Mine
|
Capital
|
|
Half year ended 30 June 2024
|
Office
|
|
Plant
and
|
Mining
|
development
|
work
in
|
|
(Unaudited)
|
equipment
|
Buildings
|
equipment
|
equipment
|
properties
|
progress
|
Total
|
|
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
US$'000
|
|
Cost
|
|
|
|
|
|
|
|
|
Balance at 1 January 2024
|
8,168
|
56,776
|
673,601
|
319,775
|
1,146,835
|
37,744
|
2,242,899
|
|
Additions
|
-
|
-
|
152
|
-
|
-
|
85,611
|
85,763
|
|
Additions and modifications: Right of
use assets
|
-
|
18
|
-
|
(23)
|
-
|
-
|
(5)
|
|
Transfers from capital work in
progress
|
37
|
797
|
9,344
|
21,990
|
51,531
|
(83,699)
|
-
|
|
Transfer from exploration and
evaluation asset
|
-
|
-
|
-
|
-
|
3,884
|
-
|
3,884
|
|
Transfers between
categories
|
-
|
-
|
1,216
|
(1,216)
|
-
|
-
|
-
|
|
Disposals
|
-
|
(95)
|
(5,780)
|
(25,919)
|
-
|
-
|
(31,794)
|
|
Disposals: Right of use
assets
|
-
|
(122)
|
-
|
-
|
-
|
-
|
(122)
|
|
Balance at 30 June 2024
|
8,205
|
57,374
|
678,533
|
314,607
|
1,202,250
|
39,656
|
2,300,625
|
|
Accumulated depreciation and amortisation
|
|
|
|
|
|
|
|
|
Balance at 1 January 2024
|
(7,076)
|
(24,968)
|
(346,336)
|
(250,362)
|
(530,175)
|
-
|
(1,158,880)
|
|
Depreciation and
amortisation
|
(254)
|
(2,082)
|
(37,194)
|
(22,008)
|
(32,416)
|
-
|
(93,954)
|
|
Transfers between
categories
|
-
|
-
|
(679)
|
679
|
-
|
-
|
-
|
|
Disposals
|
-
|
126
|
3,465
|
24,721
|
-
|
-
|
28,312
|
|
Balance at 30 June 2024
|
(7,330)
|
(26,924)
|
(380,744)
|
(246,970)
|
(562,591)
|
-
|
(1,224,522)
|
|
Year ended 31 December 2023 (Audited)
Cost
|
|
|
|
|
|
|
|
|
Balance at 1 January 2023
|
8,151
|
21,701
|
635,376
|
383,521
|
1,009,754
|
78,804
|
2,137,307
|
|
Additions
|
76
|
290
|
44
|
402
|
-
|
189,911
|
190,723
|
|
Additions: Right of use
assets
|
-
|
1,150
|
66
|
-
|
-
|
-
|
1,216
|
|
Increase in rehabilitation
asset
|
-
|
-
|
-
|
-
|
1,310
|
-
|
1,310
|
|
Transfers from capital work in
progress
|
890
|
3,216
|
74,033
|
29,233
|
123,599
|
(230,971)
|
-
|
|
Transfers from exploration and
evaluation asset
|
-
|
-
|
-
|
-
|
12,172
|
-
|
12,172
|
|
Transfers between
categories
|
515
|
31,782
|
(26,266)
|
(6,031)
|
-
|
-
|
-
|
|
Disposals
|
(1,464)
|
(52)
|
(9,373)
|
(87,350)
|
-
|
-
|
(98,239)
|
|
Disposals: Right of use
assets
|
-
|
(1,311)
|
(279)
|
-
|
-
|
-
|
(1,590)
|
|
Balance at 31 December 2023
|
8,168
|
56,776
|
673,601
|
319,775
|
1,146,835
|
37,744
|
2,242,899
|
|
Accumulated depreciation and amortisation
|
|
|
|
|
|
|
|
|
Balance at 1 January 2023
|
(6,634)
|
(3,573)
|
(308,034)
|
(288,521)
|
(443,896)
|
-
|
(1,050,658)
|
|
Depreciation and
amortisation
|
(1,387)
|
(3,001)
|
(63,511)
|
(43,986)
|
(86,242)
|
-
|
(198,127)
|
|
Transfers between
categories
|
(522)
|
(19,412)
|
15,589
|
4,345
|
-
|
-
|
-
|
|
Disposals
|
1,467
|
1,018
|
9,620
|
77,800
|
-
|
-
|
89,905
|
|
Balance at 31 December 2023
|
(7,076)
|
(24,968)
|
(346,336)
|
(250,362)
|
(530,138)
|
-
|
(1,158,880)
|
|
Net
book value
|
|
|
|
|
|
|
|
|
As at 31 December 2023
|
1,092
|
31,808
|
327,265
|
69,413
|
616,697
|
37,744
|
1,084,019
|
|
As
at 30 June 2024
|
875
|
30,450
|
297,789
|
67,637
|
639,659
|
39,656
|
1,076,104
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
As at 30 June 2024, the Group has
contractual commitments for capital expenditure for the remainder
of the year amounting to US$54 million (H1 2023: US$47
million).
Included within the depreciation
charge for the period in relation to ROU assets is US$0.4 million
for buildings and US$0.2 million related to plant and equipment (H1
2023: US$0.5 million buildings and US$0.6 million plant and
equipment).
The net book value of the assets
in the note above includes the following amounts relating to ROU
assets on leases; US$1.9 million (H1 2023: US$1.9 million) within
buildings, US$0.7 million (H1 2023: US$0.5 million) within plant
and equipment and US$2.0 million (H1 2023: US$3.4 million) within
mining equipment.
Deferred stripping assets of US$35
million (H1 2023: US$54 million) were recognised in the six-month
period ended 30 June 2024, which have been included in mine
development properties, US$13 million (H1 2023: US$18 million) of
amortisation has been recognised in the same period.
The Group implemented a new
enterprise resource planning (ERP) software system, SAP (S4 HANA)
during the 2023 financial year. As part of the implementation and
migration from the legacy system, an extensive review process of
the fixed assets was performed as part of the fixed asset register
and operational record clean up and consequently assets that were
identified as not being in use and/or had been previously replaced
by other assets (e.g. mobile equipment rebuilds) had their carrying
values derecognised from the statement of financial
position.
The fixed assets derecognised as
part of this process, which are included within disposals in the 31
December 2023 section of the table above, had a total cost of
US$61million, accumulated depreciation of US$53 million and a
carrying value of US$8 million which was recognised as a loss in
the profit or loss statement within the other operating costs line.
In addition, where assets were identified as being classified in
incorrect asset categories, reclassification adjustments were made
to correct this in the 2023 financial year, see the PPE note above.
The Directors concluded that the adjustments were qualitatively
immaterial to the financial statements given the small proportion
of the overall property, plant and equipment balance impacted, and
the quantum of the impact in the profit or loss
statement.
Management has considered a number
of factors when concluding on whether an impairment trigger existed
as at 30 June 2024, including assessing the carrying value of the
Group's net assets in comparison to the Group's market
capitalisation, review of the operations in its locations, and most
importantly at Sukari as it makes up a significantly portion of the
Group's net assets. Based on the assessment, there were no issues
that were noted which may adversely impact the Group's assets and
as such, management has concluded that there is not an impairment
trigger relating to the Sukari CGU and any of its other assets as
at 30 June 2024.
Assets that have been cost
recovered under the terms of the CA in Egypt are included in the
statement of financial position under property, plant and equipment
as the SGM will use them until the expiration of the CA.
2.6 Exploration and evaluation asset
|
30 June
|
30
June
|
31
December
|
|
2024
(Unaudited)
|
2023
(Unaudited)
|
2023
(Audited)
|
|
US$'000
|
US$'000
|
US$'000
|
Balance at the beginning of the
year
|
24,809
|
24,809
|
24,809
|
Expenditure for the
period
|
3,884
|
6,578
|
12,172
|
Transfer to property, plant and
equipment
|
(3,884)
|
(6,578)
|
(12,172)
|
Balance at end of the
period
|
24,809
|
24,809
|
24,809
|
The exploration and evaluation
asset relates to the drilling, geological exploration and sampling
of potential ore reserves and can all be attributed to
Egypt.
In accordance with the
requirements of IAS 36 'Impairment of Assets' and IFRS 6
'Exploration for and evaluation
of mineral resources' exploration assets are assessed for
impairment when facts and circumstances (as defined in IFRS 6
'Exploration for and evaluation
of mineral resources') suggest that the carrying amount of
exploration and evaluation asses may exceed its recoverable
amount.
An impairment trigger assessment
was performed as at 30 June 2024 on the exploration and evaluation
assets and no impairment triggers were identified.
2.7 Inventories
|
30 June
|
30
June
|
31
December
|
|
2024
(Unaudited)
|
2023
(Unaudited)
|
2023
(Audited)
|
|
US$'000
|
US$'000
|
US$'000
|
Non-current
|
|
|
|
Mining stockpiles
|
120,594
|
110,337
|
103,121
|
|
|
|
|
Current
|
|
|
|
Mining stockpiles, ore in circuit,
doré supplies
|
46,227
|
24,556
|
45,807
|
Stores inventory
|
101,226
|
93,596
|
106,150
|
Provision for obsolete stores
inventory
|
(8,194)
|
(6,085)
|
(2,500)
|
|
139,259
|
112,067
|
149,457
|
The calculation of weighted
average costs of mining stockpiles is applied at a detailed level.
The open pit ore on the Mine ROM is split into seven different
grade categories and the underground ore is treated as a single
high-grade category. Each grade category is costed individually on
a weighted average basis applying costs specifically related to
extracting and moving that grade of ore to and from the Mine ROM
pad. The grade categories range from high-grade underground and
open pit ore to low-grade open pit ore. Costs per contained ounce
differ between the various cost categories.
Currently at Sukari, low-grade-low
(0.4 to 0.5g/t) open pit stockpile material above the cut-off grade
of 0.4g/t has been classified as follows on the statement of
financial position:
·
|
Current assets - No low-grade-low
stockpiles are in the current inventory balance as none are
scheduled to be processed within the next twelve months;
and
|
·
|
Non-Current assets - 15.6Mt at
0.45g/t of stockpiles are in non-current assets as these ore tonnes
are also not scheduled to be processed within the next twelve
months
|
2.8 Provisions
|
30 June
|
30
June
|
31
December
|
|
2024
(Unaudited)
|
2023
(Unaudited)
|
2023
(Audited)
|
|
US$'000
|
US$'000
|
US$'000
|
Current
|
|
|
|
Employee
benefits(1)
|
406
|
2,429
|
1,054
|
Other current
provisions(2)
|
258
|
525
|
930
|
|
664
|
2,954
|
1,984
|
Non‑current
|
|
|
|
Restoration and
rehabilitation(3)
|
40,842
|
38,064
|
40,039
|
Other non-current
provisions
|
50
|
-
|
-
|
|
40,892
|
38,064
|
40,039
|
Movement in restoration and rehabilitation
provision
|
|
|
|
Balance at beginning of the
year
|
40,039
|
37,396
|
37,396
|
Decrease in provision
|
-
|
-
|
1,310
|
Interest expense - unwinding of
discount
|
803
|
668
|
1,333
|
Balance at end of the
period
|
40,842
|
38,064
|
40,039
|
1) Employee
benefits relate to annual, sick, and long service leave
entitlements and bonuses.
2) Provision for
customs, rebates and withholding taxes.
3) The provision
for restoration and rehabilitation is as per the 31 December 2023
assessment. At that date, the provision was discounted at 4.01%
(2022: 3.68%) using a US$ applicable rate and inflation applied at
2.40% (2022: 2.37%). The annual review undertaken as at
31 December 2023 resulted in a US$1.3 million increase in the
provision (2022: US$5.8 million decrease). The key assumptions
within the estimate, the various ranges and further details are
disclosed in note 1.2.4 in the 2023 Annual Report. No updates to
the provision were made in H1 2024 other than the unwinding of the
interest.
In 2023, the Group made
significant progress to align its tailings management framework to
the GISTM and is able to report its level of conformance against
each principle of the standard. This did not have a material impact
on the provision recognised during the year. Overall, the Group's
tailings management and governance system was assessed to be in
conformance with approximately 80 to 85% of the GISTM requirements.
The Group has put in place a clear action plan and roadmap to fully
conform with the GISTM by end-2025.
We will monitor and report on our
progress towards full conformance, refer to page 19 of the
Strategic Report of the 2023 Annual Report.
2.9 Trade and other payables
|
30 June
|
30
June
|
31
December
|
|
2024
(Unaudited)
|
2023
(Unaudited)
|
2023
(Audited)
|
|
US$'000
|
US$'000
|
US$'000
|
Non-Current
|
|
|
|
Other
creditors(1)
|
5,138
|
8,814
|
8,264
|
|
5,138
|
8,814
|
8,264
|
Current
|
|
|
|
Trade payables
|
38,088
|
34,856
|
27,637
|
Other creditors and
accruals(1)
|
51,323
|
46,110
|
66,611
|
|
89,411
|
80,966
|
94,248
|
(1) Included within
non-current other creditors and current other creditors and
accruals is $2.4m (2023: $4.8m) and $7.4m (2023 $4.9m) respectively
in relation to the remaining instalments of a $17.6m settlement
agreement signed with EMRA in 2021. By its nature, elements of the
cost recovery mechanism within the Concession Agreement are subject
to interpretation and ongoing audits by
EMRA.
Also included within current and
non-current other creditors are lease liabilities of US$1.4m (2023:
US$2m) and US$2.7m (2023: US$3.8m) respectively.
2.10 Cash flow information
(a) Reconciliation of cash and cash
equivalents
For the purpose of the statement
of cash flows, cash and cash equivalents includes cash on hand and
at bank and short-term deposits of less than 90 days maturity on
inception.
|
30 June
|
30
June
|
31
December
|
|
2024
(Unaudited)
|
2023
(Unaudited)
|
2023
(Audited)
|
|
US$'000
|
US$'000
|
US$'000
|
Cash and cash equivalents - per
statement of cash flows and
statement of financial
position
|
109,607
|
96,231
|
93,322
|
|
109,607
|
96,231
|
93,322
|
(b) Reconciliation of profit for the year to cash flows from
operating activities
|
30 June
2024
(Unaudited)
|
30
June
2023
(Unaudited)
|
31
December 2023
(Audited)
|
|
US$'000
|
US$'000
|
US$'000
|
Profit for the period before tax
|
117,149
|
114,804
|
195,140
|
Adjusted for:
|
|
|
|
Depreciation/amortisation of
property, plant and equipment
|
93,921
|
79,022
|
198,127
|
Inventory written
off
|
373
|
204
|
3,721
|
Inventory obsolescence
provision
|
5,694
|
(419)
|
(4,004)
|
Foreign exchange gains,
net
|
(1,962)
|
(4,463)
|
(5,682)
|
Fair value loss/(gain) on
derivative financial instruments
|
654
|
(490)
|
5,509
|
Share‑based payments expense
|
5,132
|
2,268
|
7,306
|
Finance income
|
(3,126)
|
(1,791)
|
(4,127)
|
Finance costs
|
2,179
|
1,380
|
3,526
|
Loss on disposal of
property, plant and equipment
|
3,604
|
1,855
|
9,415
|
Changes in working capital during the
period:
|
|
|
|
(Increase)/decrease in trade and
other receivables
|
5,963
|
(3,632)
|
(13,815)
|
(Increase)/decrease in
inventories
|
(12,969)
|
6,853
|
(19,737)
|
(Increase)/decrease in
prepayments
|
(5,509)
|
540
|
(3,181)
|
Purchase of derivative financial
instruments
|
-
|
(2,538)
|
(6,163)
|
Decrease in trade and other
payables
|
(6,484)
|
(21,481)
|
(9,901)
|
Increase in provisions
|
332
|
367
|
61
|
Cash flows generated from
operating activities
|
204,951
|
172,479
|
356,195
|
(c) Non‑cash financing and investing
activities
During the period there have been
no non‑cash
financing and investing activities.
3.
Unrecognised items
3.1 Contingent liabilities
Refer to note 2.9 for additional
information on the EMRA position with respect to
provisions.
Other than as highlighted above,
there were no contingent liabilities at year end.
3.2 Subsequent events
The Directors declared an interim
dividend of 2.25 US cents per share on Centamin plc ordinary shares
(totalling approximately US$26 million). The interim dividend for
the half year period ended 30 June 2024 will be paid on 27
September 2024 to shareholders on the register on the Record Date
of 30 August 2024.
Other than the above, there were
no other significant events occurring after the reporting date
requiring disclosure in the financial statements.
3.3 Related Parties
There have been no material
changes in relation to the related party transactions, as disclosed
in the FY2023 Annual Report and Accounts, and details of the
Non-Controlling Interest in SGM for the period ended 30 June 2024
are set out in 2.4 above.
4.
Other information
4.1 Contributions to Egypt
Gold sales agreement
On 27 March 2023, SGM and the
Central Bank of Egypt ("CBE") amended their 20 December 2016
agreement with respect to SGM's facilitation of the purchase of
refined gold bullion for the CBE from its refiner. The amended
agreement provides that the parties may elect, on a monthly basis,
for the CBE to supply SGM with its local Egyptian currency
requirements for that month to a maximum value of EGP130 million.
In return, SGM facilitates the purchase of refined gold bullion for
the CBE from SGM's refiner, Asahi Refining Canada Ltd up to 30 June
2023 and thereafter, MKS PAMP SA. This agreement with CBE was
entered into as SGM requires local currency for its operations in
Egypt (it receives its revenue for gold sales in US dollars). The
values related to these transactions are as follows:
|
30 June
|
30
June
|
31
December
|
|
2024
(Unaudited)
|
2023
(Unaudited)
|
2023
(Audited)
|
|
US$'000
|
US$'000
|
US$'000
|
Gold purchased
|
28,963
|
12,993
|
34,124
|
Refining costs
|
13
|
7
|
17
|
Freight costs
|
35
|
20
|
43
|
|
29,011
|
13,020
|
34,184
|
|
30 June
|
30
June
|
31
December
|
|
2024
(Unaudited)
|
2023
(Unaudited)
|
2023
(Audited)
|
|
Oz
|
Oz
|
Oz
|
Gold purchased
|
13,438
|
6,752
|
17,520
|
At 30 June 2024 the net receivable
in EGP owing from the Central Bank of Egypt is approximately the
equivalent of US$50,830 (30 June 2023: US$16,062 net receivable and
31 December 2023: US$25,045 receivable).
-END-