REG - ACG Metals Ltd. - Q1 2025 Operations and Capital Structure Update

ACG MetalsAnnouncement

Tue 07:00

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RNS Number : 5162G  ACG Metals Limited  29 April 2025

29 April 2025

 

ACG METALS LIMITED

("ACG" or the "Company")

Q1 2025 Operations and Capital Structure Update

 

Operational Strength, Expansion Milestones and Capital Structure Optimisation

ACG Metals Limited (LSE:ACG) is pleased to announce its operations and capital
structure update for the first quarter of 2025 ("Q1 2025" or the "Quarter" or
"Period").

Artem Volynets (Chairman and CEO) and Patrick Henze (CFO) will provide a live
presentation via Investor Meet Company on 09 May 2025, 14:00 BST. To attend,
investors can join via this link:
https://www.investormeetcompany.com/acg-metals-limited/register-investor
(https://www.investormeetcompany.com/acg-metals-limited/register-investor) .

Highlights

In the first quarter of 2025, the Gediktepe Mine delivered strong operational
performance compared to Q1 2024 achieving a 29% increase in Gold Equivalent
production yielding 16.2koz of Gold Equivalent sales. In addition, we
maintained cost discipline in decreasing AISC by 13% while benefitting from a
38% increase in realized Gold prices.

The Gediktepe Sulphide Expansion Project also continued to advance on schedule
and on budget, with major early works completed and construction activities
expected to ramp up materially in the coming quarter.

At the same time, ACG has significantly strengthened its capital structure
through the early repayment of acquisition and a portion of the shareholder
loans. The successful completion of share and cash tender offers to
significantly simplify the equity capital structure and the execution of a
gold hedging strategy to protect near-term cash flows.

Artem Volynets, Chairman and CEO of ACG, said:

"The first quarter of 2025 has further demonstrated the strength and
reliability of our operations at Gediktepe, as well as the exceptional
performance of our team. We have already delivered nearly 50% of the full-year
production forecast shared during the bond roadshow last year, with further
inventory in hand - a strong indicator of our performance trajectory and
conservative projections to investors. Even as the market faced inflationary
pressure in Türkiye, we controlled costs resulting in a decrease compared to
the first quarter of last year.

Our early repayments of acquisition and sponsor loans demonstrate disciplined
capital management, while the successful completion of both the USD200 million
bond (fully funding our expansion) and warrant tender offers have ensured
financial stability and simplified our capital structure and improved
alignment with shareholders.

Additionally, the implementation of a structured gold hedging strategy
provides prudent downside protection while preserving upside exposure
derisking the cash flows indicated to our investors.

As a result of these initiatives as well as the favourable commodity price
environment and the continued cost discipline on site, we are significantly
ahead of schedule on funding our financial obligations under the bond and
remaining shareholder loans in 2025.

At the same time, we are pleased with the progress on the Gediktepe Copper
Sulphide Expansion Project, with key milestones achieved on time and on
budget. This expansion is transformational for ACG, positioning Gediktepe as a
long-life, low-cost copper producer."

Q1 2025 Operational Highlights

·    In accordance with previous years and the 2025 mine plan, Q1
production and sales were generated from the large inventory balance at the
end of 2024. This will continue in Q2 2025.

·    Pre-stripping of the pits is progressing on time and on budget to
mine fresh ore in Q3 and Q4 of this year.

·    Gediktepe produced 12,892oz of Gold and 239,948oz of Silver resulting
in 15,565oz of Gold Equivalent for the Quarter. This was converted to
16,225koz of Gold Equivalent in sales.

·    Quarterly average realised prices for Gold ($2,835/oz) and Silver
($32/oz) have improved by 38% and 36% respectively compared to Q1 2024.

·    Q1 costs remained within the budget at $441 per ounce representing a
decrease of 37%, with all-in sustaining costs of $982 per ounce representing a
decrease of 13% compared to Q1 2024.

 

 

Q1 2025 Operating Summary

                                 Q1 2025  vs Q1 2024

 Total Ore Mined           t     3,806    -50%        Mining
 Au Grade                  g/t   0.08     -81%
 Ag Grade                  g/t   122      493%

 Total Ore Processed       t     0        -100%       Process
 Au Grade                  g/t   0.00     -100%
 Ag Grade                  g/t   0.00     -100%

 Au                        oz    12,892   23%         Production
 Ag                        oz    239,948  66%
 AuEq                      oz    15,565   29%

 Au                        oz    13,692   -4%         Sales
 Ag                        oz    227,175  49%
 AuEq                      oz    16,225   2%

 Au                        $/oz  2,835    38%         Realised Price
 Ag                        $/oz  32       36%

 C1 Cash Costs (produced)  $/oz  441      -37%        Cost
 AISC (sold)               $/oz  983      -13%

 

Sulphide Expansion Project Moving Forward at Pace

·    The Gediktepe Copper Sulphide Expansion Project continues to progress
in line with plan and budget. Mobilisation of GAP İnşaat, the fixed-price
EPC contractor, is well advanced, with the construction mobilisation area
targeted for completion by in the first half of May 2025.

·    As at 31 March 2025, approximately 90% of required earthworks had
been completed. Final handover of the area to GAP is expected in early May.

·    All long-lead items, including the flotation and thickener tanks,
have been ordered with upfront payments completed.

·    Major site preparation activities have advanced substantially, with
the main access road to the Sulphide Process Plant completed up to the base
course.

·    Excavation work at the plant site is progressing well, with over
176,000m³ of material already excavated.

·    As at 31 March 2025, the project remains well within its project
schedule milestones completing 46% of engineering design and draft, 33% of
procurement and 8% of construction.

·    The Sulphide Expansion Project remains on schedule for commissioning
in Q1 2026, with no delays or cost overruns, reinforcing Gediktepe's
transition into a long-life, low-cost copper producer.

Bond Placement Update

In December 2024, ACG successfully raised $200 million through a four-year
senior secured bond issuance with a coupon rate of 14.75%, the proceeds of
which either have been or will be applied to fully finance the sulphide
expansion project at the Company's operating Gediktepe Mine in Türkiye and
the repayment of the acquisition facility with Traxys Europe S.A. and Argentem
Creek Partners on 23 January 2025.

An application has been made for listing the bonds on the Nordic ABM and is
currently being finalised. The listing of the bonds is expected to occur in
May.

ACG has since executed three drawdowns (including transaction costs) from the
bond proceeds, amounting to $62.6 million in total and fulfilled all CPs under
the bond terms in line with projected schedule and budget.

Debt Repayment and Strengthened Financial Position

As part of the acquisition of the Gediktepe Mine in Turkey, ACG entered into a
$37.5 million acquisition facility agreement with Traxys Europe S.A. and
Argentem Creek Partners on August 31, 2024.

Within just two months since the acquisition of Gediktepe, ACG repaid $12.1
million of the principal amount of this facility, bringing the outstanding
principal amount down to $25.4 million as at October 31, 2024. Utilising the
bond proceeds in January, ACG made an early settlement, 8 months before
scheduled maturity, and fully repaid the outstanding principal to Traxys
Europe S.A. and Argentem Creek Partners.

Since October 31, 2024, the Company repaid a further $7.1 million of its
shareholder loans (including interest), reducing the outstanding balance to $7
million, down from $13.5m and equating to a c.50% reduction. The shareholder
loans mature in October 2025.

ACG's bond escrow and bank cash balance as at March 31, 2025 was $190.7
million.

Completion of the Share & the Cash Tender Offers

In March 2025, the company announced the completion of parallel share and cash
tender offers in respect of its outstanding warrants. Pursuant to the share
tender offer, the Company has acquired 26,899,414 warrants, representing
approximately 70% of all warrants, in exchange for 2,689,927 class A ordinary
shares in the capital of the Company. In addition, pursuant to the cash tender
offer, funds managed by Argentem Creek Partners acquired 1,121,411 warrants at
a purchase price of $0.50 per warrant for total consideration of $560,705.50.

Following completion of the share and cash tender offers, the Company has
21,659,146 class A ordinary shares in issue and 38,427,749 warrants
outstanding, of which 26,899,414 warrants are currently held in treasury.

Execution of Gold Hedging Strategy

ACG has successfully executed a hedging strategy covering 50% of its planned
gold production through January 2026 using a structured collar option,
allowing the Company to secure strong downside protection while retaining
exposure to potential upside.

- ENDS -

The person responsible for the release of this information on behalf of the
Company is Artem Volynets, Chairman & Chief Executive Officer.

 

For further information please contact:

 

Palatine

Communications Advisor

Conal Walsh / James Gilheany/ Kelsey Traynor/ Richard Seed

 acg@palatine-media.com (mailto:acg@palatine-media.com)

 

Stifel

Joint Broker

Ashton Clanfield / Varun Talwar

+44 (0) 20 7710 7600

 

Berenberg

Joint Broker

Jennifer Lee / Natasha Ninkov

+44 (0) 20 3207 7800

 

Canaccord

Joint Broker

James Asensio / Charlie Hammond

+ 44 (0) 20 7523 8000

 

 

About the Company

 

ACG Metals is a company with a vision to consolidate the copper industry
through a series of roll-up acquisitions, with best-in-class ESG and carbon
footprint characteristics.

 

In September 2024, ACG successfully completed the acquisition of the Gediktepe
Mine which is expected to transition to primary copper and zinc production
from 2026 and will target annual steady-state copper equivalent production of
20-25 kt. Gediktepe produced 55koz of AuEq in 2024.

 

ACG Metals continues to build its pipeline of prospective,
multi-jurisdictional M&A candidates with the objective of closing
additional acquisitions toward securing 200,000-300,000 tonnes of copper
equivalent production annually over the next three to five years.

 

ACG's team has extensive M&A experience built through decades spent at
blue-chip multinationals in the sector. The team brings a significant network
as well as a commitment to ESG principles and strong corporate governance.

 

For more information about ACG, please visit: www.acgmetals.com
(http://www.acgmetals.com)

 

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