TIDMVAST
Vast Resources PLC
05 November 2021
Vast Resources plc / Ticker: VAST / Index: AIM / Sector:
Mining
5 November 2021
Vast Resources plc
("Vast" or the "Company")
Q&A
Vast Resources plc, the AIM-listed mining company, is pleased to
provide the market with answers to a number of questions submitted
by shareholders during recent weeks. The answers to these questions
are intended to provide further clarity over and above the
information issued in the recent annual report and announcement of
25 October 2021 regarding the Company Update. The Board and
management would like to note that some questions have been omitted
from this document due to regulatory or commercial sensitivity
restrictions.
General
1. Is Vast being set up to be taken over privately by another
company or any Vast employees? The actions of the board and the
share price decline has prompted some shareholders question whether
this is the ultimate aim.
No, this is certainly not the case. The Vast board, management
team and advisory teams are all unified in their objective to
continue to advance the Company's operations and communicate this
to the market to achieve the appropriate value uplift on the equity
market.
2. Will Vast be providing a separate RNS on production figures
from the six months to October 2021 by the end of November
2021?
Production figures were provided up to the third week of October
2021. The Company will provide production and sales figures for the
whole of October, November, and December by the end of January and
quarterly thereafter as per the RNS made on 25(th) October 2021
3. Can Vast confirm that the AGM will be held in a reasonable
timeframe, given that Andrew Prelea and Craig Harvey have both
exceeded the period for their approved directorships?
The duration of the directorships has not been exceeded; Craig
Harvey was reappointed last year, and Andrew Prelea is eligible for
re-election at the next AGM as is Roy Tucker. The Company will be
issuing a notice of the next AGM during the current month.
4. Can you advise if Andrew Prelea and other board members will
extend their no selling duration by another 12 months, given the
performance this year?
Please refer to the announcement of 28 October 2021 relating to
the extension of the directors' lock-up period.
5. Will the SARs recipients consider exercising once the Annual
Report is issued to demonstrate faith in the plans and their
achievement, rather than waiting to make a cashless guaranteed
profit transaction?
The SARs awarded to date are not exercisable given the strike
price for all awards is significantly greater than the current
share price. The Directors have also purchased shares and are
themselves in a loss-making scenario based on the current share
price. The Board of Directors are unified in the goal of restoring
fair value to the share price.
6. Will directors consider a pay freeze or at least a pay cut,
to show solidarity with the current long-term shareholders who are
tens of thousands of pounds down on their investment?
All Vast directors have opted to defer their remuneration over
recent months and as a Board, they prioritise cashflows to the
asset and supporting personnel before compensating Directors.
7. Are there any outstanding court cases involving Vast in any jurisdiction?
There are some outstanding court cases in Romania however these
are not deemed to pose a risk to the Company's operations. For more
information, please refer to the Company's audited accounts dated
28 October 2021 ( see note 25).
8. Vast's reputation in the market has been eroded - how can the
Company look to attract institutional investors when retail
investors are panicked, and volume and the price are at an all-time
low?
We intend to demonstrate a continued consistent improvement in
our production profile at Baita Plai and rationalise the financing
structures in place to support long term share price performance.
Baita Plai is an exceptional asset and whilst it has taken longer
to move into profitability than originally conceived, the Company
has overcome challenges, as outlined in the recent RNS, and has
translated limited capital expenditure (by usual mining industry
standards), into enormous potential value. The fact that the value
is not reflected in the share price today, does not take away the
fundamental potential value of the asset which should become more
evident to the Market as the asset progresses towards production
capacity.
The additional pipeline interests within Vast's portfolio,
particularly Manaila which the Company believes could be brought
back into production with modest capital outlay, are not recognised
in today's share price today.
9. How is the Company addressing recent allegations?
As stated in the RNS of 25 October 2021 we have instituted an
enquiry into a breach of confidential information by an external
counterparty who was under strict confidentiality agreements with
the Company. The internal enquiry remains ongoing, and the
counterparty has been notified of his breach by the Company's
lawyers. The result of the enquiry will be announced when
available.
Financing & Atlas
10. Could you update shareholders on Vast's financing strategy
in respect to Baita Plai, Manaila and Botswana? Shareholders have
concerns about Vast's risk management and ability to get
traditional funding, and instead relying on placings and the
dilution of shareholders.
a. Can you name who the finance companies are, and/or whether
they are classified as 'Tier One' banking institutions offering a
proper finance set up instead of what we currently have in place
with Atlas?
The Company cannot name the funders due to commercial NDAs. It
should be noted that Romania is a relatively new jurisdiction for
foreign direct investment in the mining sector and it currently has
no real peer comparisons which has created additional hurdles for
the board and management to overcome when negotiating with
traditional lenders. However, as Baita Plai ramps up and
demonstrates a consistent production profile, the financing process
is expected to ameliorate.
b. Considering a tier one bank wouldn't lend to Vast until a
corporate restructuring had been undertaken, why should these
banking institutions agree to lend now as this restructuring has
not been done?
The Tier 1 bank we were in discussions with last year has
different criteria from the current lenders we are negotiating
with, and we do not believe that structure and geographic spread of
portfolio will influence the decision making of these lenders.
Baita Plai
11. Supply issues are currently a problem worldwide. With
shipping costs having escalated and drivers in short supply. How is
this being addressed? Does Vast pay the shipping costs or does
Mercuria? Is the Company shipping monthly or has this moved to
bi-monthly or quarterly to save money? Is this affecting the
cashflow of the business?
The shipments are being carefully managed however shipping is
ultimately in the hands of the off-taker, with Vast supplying
concentrate according to the off-takers shipping schedules. The
shipments vary from month to month however both Vast and the
off-taker are working on a pre-booking arrangement to mitigate
delays and optimise shipments.
12. When can shareholders expect the following:
a. The arrival on site and installation of the new jumbo drilling rig?
Vast has been advised that it will be delivered before the end
of December 2021, however the Vast team have forward planned to
ensure that it doesn't need to be in place until January to provide
an additional buffer.
b. The installation of the XRT at Baita Plai?
This has been scheduled to be operational in the latter part of
H1 2022 to accommodate the additional infrastructure required and
to synchronise with the increased volumes contemplated at that
time.
13. The friable issue at Baita Plai was discovered in late
August so why wasn't the market advised immediately, like the
broken bridge and the lack of production in H2 FY21, these were all
materially impactful price issues that should have been
communicated to the market much sooner.
As regards the friable area, this was initially encountered in
late August. The tonnage to plant in August still exceeded that of
July. The Company, without hesitation, initiated an audit of the
situation and prepared a strategy to work around the area. The
market was immediately updated with the conclusions being reached
once the audit process had been concluded.
Zimbabwe & Botswana
14. What is causing the delay in Zimbabwe? Shareholders were
advised that the Company were simply awaiting a signature, but this
does not seem to be the case. At what point does Vast concede
defeat on this? At what point does Vast's business in Zimbabwe have
too much of a detrimental impact on the business as a whole - such
as the inability to get finance?
Due to the various political and legal sensitivities, the Board
cannot publicly comment on this however every action taken by the
Company has been documented and verified to the full satisfaction
of the various regulatory bodies involved. Although the continued
delays are unquestionably frustrating, the Company, as per various
announcements, remains hopeful of a positive outcome and believes
the continued tenacity of the Vast team will ultimately reward
shareholders.
15. Further, regarding Zimbabwe, and settlement of historical
claims, can you confirm that this would be in Vast's favour and, if
so, are the sums involved something that would change the Company's
ability to refinance? Does the Board expect a conclusion within a
year?
The settlement is mutually beneficial to all Parties involved
and the Board are in constant dialogue with the relevant
authorities but cannot disclose at this point the status. The
Company is hopeful of a conclusion but is not in control of timing
or the outcome and it is premature to speculate as to what that
might be.
16. What is the status of finance re Botswana (and is it
reasonable to expect success on financing given the ability to
finance other assets?). If external finance cannot be secured, how
will the Board proceed?
The Board has been clear that Ghaghoo will be financed through
third-party, non-equity linked, financing and external finance in
the form of a bank guarantee is a condition precedent for the
completion of the acquisition.
**ENDS**
For further information, visit www.vastplc.com or please
contact:
Vast Resources plc www.vastplc.com
Andrew Prelea (CEO) +44 (0) 20 7846 0974
Andrew Hall (CCO)
St Brides Partners Limited www.stbridespartners.co.uk
Susie Geliher +44 (0) 20 7236 1177
ABOUT VAST RESOURCES PLC
Vast Resources plc is a United Kingdom AIM listed mining company
with mines and projects in Romania and Zimbabwe.
In Romania, the Company is focused on the rapid advancement of
high-quality projects by recommencing production at previously
producing mines.
The Company's Romanian portfolio includes 100% interest in the
producing Baita Plai Polymetallic Mine, located in the Apuseni
Mountains, Transylvania, an area which hosts Romania's largest
polymetallic mines. The mine has a JORC compliant Reserve &
Resource Report which underpins the initial mine production life of
approximately 3-4 years with an in-situ total mineral resource of
15,695 tonnes copper equivalent with a further 1.8M-3M tonnes
exploration target. The Company is now working on confirming an
enlarged exploration target of up to 5.8M tonnes.
The Company also owns the Manaila Polymetallic Mine in Romania,
which was commissioned in 2015, currently on care and maintenance.
The Company has been granted the Manaila Carlibaba Extended
Exploitation Licence that will allow the Company to re-examine the
exploitation of the mineral resources within the larger Manaila
Carlibaba licence area.
In Zimbabwe, the Company is focused on the commencement of the
joint venture mining agreement on the Community Diamond Concession,
Chiadzwa, in the Marange Diamond Fields.
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END
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