TIDMGDP
RNS Number : 3615Q
Goldplat plc
20 February 2023
G ol dp lat plc / Ti cker: GDP / Index: AIM / Secto r: M in i ng
& E x p l o rati on
20 February 2023
Goldplat plc
('Goldplat', the 'Group' or 'the Company')
2nd Quarter operating results update
for the period ended 31 December 2022 ("Q2")
G ol dp lat, the AIM li sted Mining Services Group, w ith
internati onal g o ld reco very o perati ons l o cated in South Afr
i ca and Ghana, servicing the African and South American Mining
Industry, is p leased to announce an operational update for Q2.
The two recovery operations continued to produce good combined
operating profit during Q2, albeit down 41% on a strong Q2 period
during the previous financial period, of GBP1,382,000 (Q2 2021:
GBP2,356,000) (excluding listing and head office costs and foreign
exchange losses).
The Ghanaian operation continues to perform well as a result of
the steady supply of material and achieved an operating profit for
Q2 of GBP1,026,000 (Q2 2021: GBP1,012,000), however the South
African operations have been impacted during the last two months of
Q2 by electricity cuts by the electricity provider in the country.
Notwithstanding the electricity cuts, the South African operation
achieved an operating profit for Q2 of GBP356,000 (Q2 2021:
GBP1,344,000).
The electricity cuts we referred to in the quarterly update
announced on 8 November 2022 have continued into Q3 and are
expected to continue to some extent at least until the end of
calendar year 2023. We have been evaluating our options to manage
the situation. Generating our own electricity through the use of
diesel generators or renewable energy sources currently does not
prove to be feasible and we will instead focus on easing the
bottlenecks created as a result of the reduction in electricity
supply and increase output during periods of electricity
availability through focussed management and initial capital outlay
of less than GBP50,000. We will also adjust processing methods on
some material to increase capacity through our plant to limit the
impact that this has on production through our incineration
units.
Not all of our production circuits have been impacted to the
same extent, with our by-product's circuits having more capacity to
deal with supply of material. Regarding the by-products, we
received a large supply of material during December 2022, which has
been processed during December 2022 and January 2023 and we will
see the sales of this material coming through during Q3.
Goldplat processes an assortment of material throughout the
Group from different clients and on different contracts making use
of a wide range of plant and equipment. The Group has been
delivering profitability for the last 12 quarters, which is in line
with management's focus on ensuring sustainable cashflow and
profitability.
Whilst we cannot predict the level of electricity supply for the
rest of the year, should the electricity cuts in South Africa
continue at the current level, although we still expect to generate
operating profits over Q3 and Q4, we believe it is unlikely that we
will be able to meet market expectations for the current financial
year. We will keep the market updated with regard to the impact of
the electricity supply and on the progress of our business
generally.
The application for a pipeline to the DRD Gold premises is still
being evaluated by the authorities and although we have indicated
before that it will be by no later than June 2023, the timelines
for when approval will be received are not that clear and we will
update the market once we have more clarity. The pipeline will
provide Goldplat Recovery Limited with the ability to process the
existing Tailings Storage Facility ("TSF") which contains a JORC
resource of circa 82,000 ounces of gold (Table 1) at a DRD Gold
processing facility. The negotiations of the terms and conditions
of processing our existing TSF at a DRD Gold processing facility
still need to be finalised.
Goldplat has identified, and to an extent secured, material in
ECOWAS ("The Economic Community of West African States"); however,
the export and processing of these materials remains dependent on
approval from government officials. We continue our engagement with
the governments and mines in the ECOWAS to agree processes and
controls on the export of gold bearing products and remain
encouraged by the value we have identified that we can offer in
these countries.
The majority of material processed in Ghana during Q2 was from
clients inside the country, however we secured a larger consignment
out of South America during December and we should see the returns
from this during the last two quarters of the current financial
period.
We continue with our expansion into South America on a measured
basis, and we have identified a location and property which we are
negotiating to procure for less than GBP100,000.
The construction of the new TSF started in Q2 (to 31 December
2022) and while we aim to have this completed by the end of Q4 (to
30 June 2023), some delays may result due to the rainy season in
South Africa and additional preparation work required.
During the period we made a strategic investment of GBP 150,000
to obtain the usage of a small spiral plant for our gold operations
in South Africa and acquire a 15% shareholding in a fine coal
recovery technology company. Goldplat has an option to invest an
additional GBP 1.5m, which will increase our shareholding in that
business to above 50%. This investment would be used to
operationalize the technology through the construction of a fine
coal washing plant in Mpumalanga, South Africa. Management is still
evaluating this option which would provide us diversification in
our recovery operations into a different commodity, namely coal, of
which significant resources are available in South Africa, with
opportunities not just for processing but also for environmental
rehabilitation.
During Q2 the Group incurred capital cost of GBP253 ,000 and we
are estimating that we will require a further GBP1,500,000 during
the next 12 to 18 months to be spent on repairing and maintaining
current operations, and on improved lining of the new TSF and
improving the environmental impacts of our current processes.
Cash balances in the group remained strong at GBP2,920,000 at
the end of Q2 ( Q2 2021: GBP1,452,000). We still have significant
balances invested in inventory and debtors with main exposures to
smelters in Europe and South Africa.
Werner Klingenberg, CEO of Goldplat commented: "I am pleased to
announce continued profitability in the Group, particularly
considering some of the challenges we are facing. Our solutions
have always been flexible and unique and I believe that the team
will find a way to handle the impact of electricity cuts in South
Africa, whilst reducing their impact on our results.
We still see opportunity for supply in West Africa and we
continue to increase our supplier base in South America, supporting
further investment in the region.
Our aim remains to increase visibility of earnings through,
becoming a partner to the mining industry, by maintaining and
increasing our value offering to clients, improving our
environmental management and processes and expanding our processes
to increase the types of by-products and waste we can beneficiate
and also through identifying and securing previously mined
resources."
For further information visit www.g o ld p l at.com, f o l l ow
on Twitter @GoldPlatPlc or contact:
Werner Klingenberg Goldplat plc Tel: +27 (0) 82 051 1071
(CEO)
Colin Aaronson / George Grant Thornton UK LLP Tel: +44 (0) 20 7383
Grainger / Samuel Littler (Nominated Adviser) 5100
James Bavister / Andrew WH Ireland Limited Tel: +44 (0) 207 220
de Andrade (Broker) 1666
Tim Thompson / Mark Edwards Flagstaff Strategic and Tel: +44 (0) 207 129
/ Fergus Mellon Investor Communications 1474
goldplat@flagstaffcomms.com
The information contained within this announcement is deemed to
constitute inside information as stipulated under the retained EU
law version of the Market Abuse Regulation (EU) No. 596/2014 (the
"UK MAR") which is part of UK law by virtue of the European Union
(Withdrawal) Act 2018. The information is disclosed in accordance
with the Company's obligations under Article 17 of the UK MAR. Upon
the publication of this announcement, this inside information is
now considered to be in the public domain.
Table 1
Mineral Resource Estimate of the TSF, South Africa
Total Resource
Domain Class Tonnes Density Au (g/t) Au (Oz) U(3) O(8) U(3) O(8) Ag (g/t) Ag (Oz)
(Mil) (g/t) (lbs)
----------- ------------ -------- --------- -------- ----------- ----------- --------- --------
TOTAL
RESOURCE Measured 0.87 1.32 1.82 50,907 61.41 117,754 4.85 135,573
----------- ------------ -------- --------- -------- ----------- ----------- --------- --------
Indicated 0.49 1.37 1.77 27,897 59.73 64,506 4.71 74,165
------------------------- ------------ -------- --------- -------- ----------- ----------- --------- --------
Inferred 0.07 1.30 1.4 3,154 71.40 11,016 2.82 6,356
------------------------- ------------ -------- --------- -------- ----------- ----------- --------- --------
Grand Total 1.43 1.34 1.78 81,959 61.32 193,276 4.70 216,094
------------ -------- --------- -------- ----------- ----------- --------- --------
The Tailings Mineral Resource Estimate was announced in
accordance with the JORC Code (2012) in a press release on 29
January 2016. Mark Austin of Applied Geology & Mining (Pty) Ltd
was the Competent Person responsible for that announcement. The
Company confirms that all material assumptions and technical
parameters underpinning the Resource Estimate continue to apply and
have not materially changed.
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END
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