REG-Altyn Plc Half-year Report
06/09/2021 07:00
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20210906:nBw6PcYS3a&default-theme=true
Half-year Report
ALTYNGOLD PLC
Chief Executive Review
AltynGold Plc (“AltynGold” or the “Company”), the gold mining and
development company, announces its unaudited results for the six months to 30
June 2021.
The financing raised in 2020 has been utilised to buy new underground mining
equipment and improve the infrastructure at the mine. The resultant increase
in production and improving grade as the orebody is being mined more
efficiently is now translating into increased turnover and profitability for
the Group. With the gold price at its current levels of around US$1,800oz, the
Group has improved its turnover from the prior period June 2020 by more than
100%.
Highlights:
Mine development
* Transport decline No.1 was developed by 150 linear metres, on ore bodies 3-8
at 148masl, transport decline 2 by 144 linear metres, opening up reserves of
770,000 tons for extraction.
* Development of the shaft and tunneling amounted to 3,131 linear metres,
(H12020:2,345 linear metres).
* Blast hole drilling amounted to 60,161 linear metres, (H1 2020: 22,500 linear
metres).
* Ore was mined in the period principally from ore bodies 3-8 at 150 and the
level of 178masl, and ore body 11 at the levels 131-174masl.
* Exploration drilling at Sekisovskoye amounted to 8,200 linear metres.
* Extensive maintenance and improvement works were carried out to maintain
production safely and efficiently.
* Exploration work at Teren-Sai continued – 9,330 linear metres of exploratory
drilling in Area No. 1, 3,860 core samples extracted in Area No.2.
Production
* Ore extracted in the period was 266,607t (H1 2020: 235,724t).
* The milled ore was 262,744t (H1 2020: 186,966t), in the current period, an
increase of 41%.
* Average processed gold grade in the period was 1.88g/t (H1 2020: 1.53g/t).
* Gold recovery averaged 82.18% during the 6 month period (H1 2020: 79.79%).
* H1 2021 gold production from Sekisovskoye was 13,066oz, compared with H1 2020
of 6,990oz.
Financial
* The turnover has increased to US$23m (H1 2020: US$11.5m). The gold price
achieved averaged US$1,832oz during the period (H1 2020 US$1,693oz).
* The Company made a gross profit of US$14.0m (H1 2020: gross profit of
US$3.9m), with a net profit before taxation of US$9.3m (H1 2020: loss of
US$1.2m).
* The total cash cost of production was US$766oz (H1 2020: US$963oz).
* Adjusted EBITDA achieved was positive at US$13.4m (H1: 2020: US$5.0m).
* Borrowings were reduced by US$2.4m in the period. Cash balances at 30 June
2021 were US$3.5m (H1 2020: US$7.2m).
Aidar Assaubayev, CEO of AltynGold plc commented:
“The Board are pleased with the progress being made with turnover increasing
by more than 100% to US$23m and operating profit moving up to US$11.2m from
US$0.6m. The capital expenditure has boosted production and revenues and the
full year results look promising. Progress at Teren-Sai is continuing, and the
Company is in the process of compiling the documentation to renew the licence
and to move Area No.2 into the next phase to calculate the reserves.”
For further information please contact:
AltynGold plc
For further information please contact:
Rajinder Basra, CFO +44 (0) 203 432 3198
Information on the Company
AltynGold plc (LSE:ALTN) is an exploration and development company, which is
listed on the main market segment of the London Stock Exchange. The
information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014.
To read more about AltynGold plc please visit our website www.altyngold.uk
(https://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.altyngold.uk&esheet=52486603&newsitemid=20210905005016&lan=en-US&anchor=www.altyngold.uk&index=1&md5=fdbba984b531a196472a57c36842dc03)
H1 2021 Review
Mine development
Sekisovskoye
The input of significant capital equipment additions in 2020 and H1 2021 has
enabled the Company to progress mining operations in all areas of mining
operations. A significant acquisition in this regard was the purchase of the
self-propelled tunnelling equipment.
The principal development milestones achieved in the period were:
* Tunnelling and shaft sinking of 3,131 linear metres, in the similar period
last year it was 2,345 metres.
* Blast hole drilling of 60,161 linear metres (H1 2020: 22,500 metres).
* Exploration drilling was carried out and amounted to 8,200 linear metres
* Backfilling of voids was carried out in the period amounting to a volume of
38,177m.
During this period the Company has been concentrating on developing ore bodies
3-8 at horizons 150m-178m and ore body 11 at horizons 134m-174m. The transport
decline No.2 was extended by 144 linear metres allowing the access of 640,000
tons of ore. Similarly transport decline No. 1 was extended by 150 linear
metres opening up accessible reserves of 130,000 tons.
In order to continue to mine efficiently and safely the following
capital/maintenance was carried out:
* A forced air facility was commissioned and built at elevation 355masl, this
necessitated the installation of 17km of overhead 6Kv lines. The Korfmann
ventilation equipment will allow safe and stable operations for a period up to
2029 in accordance with the mine operational plans.
* Various works were carried out to enable the efficient and safe working of the
stoping, this included introducing a new system of stoping and obtaining an
Ulba-150 charging unit to improve the quality of ore crushing.
* The mine operational procedures are constantly being updated to conform to
current safe working practices, during the period an electronic accounting and
explosive digitised log was introduced.
In summary the Company has been operating in line with its budgeted mining
plan, the operations at the mine have complied with all current government
guidelines in relation to COVID-19. There has been minimal disruption to the
production at the mine and the procedures and operations employed by the
Company have ensured that the employees have been working in a safe
environment.
Teren-Sai
In the current six month period the Company has been concentrating its efforts
on the exploration of two particular areas within the 198km area of the
prospective site.
In relation to Area No.1, 233 exploratory pneumatic wells were drilled,
resulting in 9,330 linear metres of drilling. From this 4,665 core samples
were extracted. The area is currently being mapped to outline the morphology
of the ore body and calculate the reserves at this site. The work is ongoing,
but good progress was made in the period.
With regards to Area no. 2 this is the most advanced project in the Teren-Sai
block, with extensive drilling being undertaken in prior periods. The
exploration program in this area is now complete with 15 core wells and 3,860
linear metres being drilled in the period, and 3,860 core samples being
extracted. The reserves estimate is currently being calculated in accordance
with the State Reserves Committee of Kazakhstan, once completed the analysis
will be forwarded to the appropriate government department. This will enable
the Company to start to move to the next phase of operations and plan for
production from Area No. 2.
H1 2021 Operational Overview – Sekisovskoye
Underground mine H1 2021 H1 2020
Ore extracted tons 266,607 235,724
Gold grade g/t 1.85 1.49
Silver grade g/t 1.80 1.10
Mineral processing H1 2021 H1 2020
Milling tons 262,774 186,966
Gold grade g/t 1.88 1.53
Silver grade g/t 1.83 1.05
Gold recovery % 82.18% 79.79%
Silver recovery % 73.19% 72.88%
Gold produced ounces 13,066 6,990
Silver produced ounces 11,315 4,555
During the period there was a significant amount of planned repair and
restoration work carried out at the processing plant. To the extent it related
to an upgrade/major overhaul the costs were capitalised, these works were in
addition to normal planned repairs absorbed into the costs for the period. The
work included the replacement of essential components in one of the grinding
mills, as well as significant upgrades to the electrolysis section of the
plant. The management see the upgrades and renewal of equipment as key to
moving production up to the next level.
An advance payment was made in July 2021 for the following equipment which is
due to be delivered for installation in Q3 2021, regeneration heater, KMD fine
crusher, shaker screens for the crushing and grading complex. It is
anticipated the improvements will lead to uninterrupted and more efficient
production in future periods.
The ore milled in the period saw an increase from the prior period of 41%, and
further increases are expected as the upgrades and maintenance programs
progress. Significantly the grade achieved of 1.88g/t is higher than the grade
that was budgeted at 1.81g/t. The effect of the new equipment reducing the
dilution is having the desired effect in increasing the grade, the grade is
budgeted to increase as the mine moves down to the lower levels.
The upgrades are also feeding into the increased recovery rates which have
moved up from 79.8% to 82%, the Company expects to maintain recovery at these
enhanced levels.
There has been a significant increase in production and sales of gold dore,
increasing from 6,990oz in June 2020 to in excess of 13,000oz in June 2021,
for the full year to 31 December 2020 the total gold poured was 17,000oz. The
Company is pleased with the progress that has been made.
H1 2021 Financial Review
The Company has reported a gross profit of US$14.0m for H1 2021, against
US$3.9m for H1 2020, with turnover of US$23m (H1 2020 US$11.5m).
The Company has seen a significant increase in its margin as revenue grows
with increasing production from higher grade ore and a higher average gold
price achieved of US$1,832 (H1 2020 US$1,693).
Sekisovskoye produced 13,066oz of gold in H1 2021 (H1 2020: 6,990oz). Gold
sold during the period amounted to 12,560oz (H1 2020: 6,790oz).
The operating cash cost of production (cost of sales excluding depreciation
and provisions) for the period was US$546/oz (H1 2020 US$828/oz). The total
cash cost was US$766/oz as compared to US$963/oz in H1 2020. The directors
monitor the cash cost closely and see it as a key indicator of the cost being
incurred to extract the gold.
In terms of other costs there has been a significant increase in
administrative costs these relate to three principal factors. An increase in
travel expenses compared to the prior period. In the period to June 2020 there
was restricted travel due to COVID-19. An increase in administrative salaries,
a number of additional staff at higher skill levels and remuneration were
employed by the Company. The third factor related to the use of specialist
consultants and advisors that were utilised on special projects and for the
provision of strategic advice to the Company. In total these accounted for
US$1.3m of the total increase of US$1.9m.
In terms of finance costs there is a significant increase in the period from
2020 of US$0.9m to US$1.7m. The principal factor was due to a full period
charges on the loans drawn down from Bank Center Credit and the balance of the
Bond that was raised on the Kazakh Stock exchange which amounted to US$6.5m
and was drawn down in June 2020.
The financial statements for June 2020 have been adjusted for the fair value
of the share options granted on 30 June 2020 to Freedom Finance who were
instrumental in raising the bonds on the Kazakh stock exchange, as disclosed
in note 1. This has resulted in an additional charge in the 30 June 2020
income statement of US$2.4m and a corresponding credit of US$2.4m to the share
based reserve. As the options were subsequently issued in October 2020 the
share based reserve have since been credited to accumulated losses.
In terms of the financial position of the Company at 30 June 2021 the deferred
tax asset has reduced with the Company moving into profit, resulting in a
charge in the current period of US$0.5m. At June 2020 no adjustment was made
to deferred tax as the impact of the acquisition of new equipment driving up
production and profitability was not clear. During the period the Company has
made substantial advance payments for equipment, parts and mining services
increasing by US$2.6m from 31 December 2020.
Borrowings have reduced by US$ 2.4m overall from December 2020 due principally
to the repayment of bonds in line with the agreed terms of repayment.
As of 30 June 2021, the Company had cash balances of US$3.5m. The Directors
have assessed that with the current cash balances and cash forecast to be
generated from operations sufficient cash will be available to meet its
current budgeted medium term plans. The directors are forward looking and are
aiming to develop further funding opportunities to grow the Company.
Aidar Assaubayev
Chief Executive Officer
3 September 2021
Directors Responsibility Statement and Report on Principal Risks and
Uncertainties
Responsibility statement
The Board confirms to the best of their knowledge, that the condensed set of
financial statements have been prepared in accordance with the UK-adopted
International Accounting Standard 34, 'Interim Financial Reporting' and the
Disclosure Guidance and Transparency Rules sourcebook of the United
Kingdom’s Financial Conduct Authority.
The interim management report includes a fair review of the information
required by:
DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of
important events that have occurred during the first six months of the
financial year and their impact on the condensed set of financial statements;
and a description of the principal risks and uncertainties for the remaining
six months of the year; and
DTR 4.2.8R of the Disclosures and Transparency Rules, being related party
transactions that have taken place in the first six months of the current
financial year and that have materially affected the financial position or
performance of the entity during the period; and any changes in the related
party transactions described in the last annual report that could do so.
The Company’s management has analysed the risks and uncertainties and has in
place control systems that monitor daily the performance of the business via
key performance indicators. Certain factors are beyond the control of the
Company such as the fluctuations in the price of gold and possible political
upheaval. However, the Company is aware of these factors and tries to mitigate
these as far as possible. In relation to the gold price the Company is pushing
to achieve a lower cost base in order to minimise possible downward pressure
of gold prices on profitability. In addition, it maintains close relationships
with the Kazakhstan authorities in order to minimise bureaucratic delays and
problems.
Risks and uncertainties identified by the Company are set out on page 8 and 9
of the 2020 Annual Report and Accounts and are reviewed on an ongoing basis.
There have been no significant changes in the first half of 2021 to the
principal risks and uncertainties as set out in the 2020 Annual Report and
Accounts and these are as follows:
* Fiscal changes in Kazakhstan
* No access to capital
* Commodity price risk
* Currency risk
* Reliance on operating in one country
* Reliant on one operating mine
* Technical difficulties associated with developing the underground mine at
Sekisovskoye and Teren-Sai
* Failure to achieve production estimates
* COVID -19 uncertainties
* Health, safety and environment
The Directors do not expect any changes in the principal risks for the
remaining six months of the financial year.
Aidar Assaubayev
Chief Executive Officer
3 September 2021
INDEPENDENT REVIEW REPORT TO ALTYNGOLD PLC
Introduction
We have been engaged by the Company to review the condensed set of financial
statements in the half-yearly financial report for the six months ended 30
June 2021 which comprises the consolidated income statement, the consolidated
statement of profit and loss and other comprehensive income, the consolidated
statement of financial position, the consolidated statement of changes in
equity, the consolidated statement of cash flows and notes to the financial
information.
We have read the other information contained in the half-yearly financial
report and considered whether it contains any apparent misstatements or
material inconsistencies with the information in the condensed set of
financial statements.
Directors’ responsibilities
The half-yearly financial report is the responsibility of and has been
approved by the directors. The directors are responsible for preparing the
half-yearly financial report in accordance with the Disclosure Guidance and
Transparency Rules of the United Kingdom’s Financial Conduct Authority.
As disclosed in note 1, the annual financial statements of the group will be
prepared in accordance with UK adopted international accounting standards. The
condensed set of financial statements included in this interim financial
report has been prepared in accordance with UK adopted International
Accounting Standard 34, ‘‘Interim Financial Reporting’’.
Our responsibility
Our responsibility is to express to the Company a conclusion on the condensed
set of financial statements in the half-yearly financial report based on our
review.
Scope of review
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 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. 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.
Conclusion
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half-yearly
financial report for the six months ended 30 June 2021 is not prepared, in all
material respects, in accordance with UK adopted International Accounting
Standard 34 and the Disclosure Guidance and Transparency Rules of the United
Kingdom’s Financial Conduct Authority.
Use of our report
Our report has been prepared in accordance with the terms of our engagement to
assist the Company in meeting its responsibilities in respect of half-yearly
financial reporting in accordance with the Disclosure Guidance and
Transparency Rules of the United Kingdom’s Financial Conduct Authority and
for no other purpose. No person is entitled to rely on this report unless such
a person is a person entitled to rely upon this report by virtue of and for
the purpose of our terms of engagement or has been expressly authorised to do
so by our prior written consent. Save as above, we do not accept
responsibility for this report to any other person or for any other purpose
and we hereby expressly disclaim any and all such liability.
BDO LLP
Chartered Accountants
London
United Kingdom
3 September 2021
BDO LLP is a limited liability partnership registered in England and Wales
(with registered number OC305127).
ALTYNGOLD PLC
Consolidated income statement
Six months Six months
ended 30 June ended 30 June
2021 2020
Unaudited Unaudited
(restated)
US$’000 US$’000
Revenue 23,009 11,495
Cost of sales (9,037) (7,571)
Gross profit 13,972 3,924
Administrative expenses (2,757) (918)
SShare based payment - (2,400)
Operating profit 11,215 606
Foreign exchange (278) (890)
Finance expense (1,676) (867)
Profit/(loss) before taxation 9,261 (1,151)
Taxation (510) -
Profit/(loss) attributable to s equity shareholders
8,751 (1,151)
Profit/(loss) per ordinary share Note
Basic and diluted (US cent) 3 32.03c (4.48c)
ALTYNGOLD PLC
Consolidated statement of profit or loss and other comprehensive income
Six months Six months
ended 30 June ended 30 June
2021 2020
unaudited
unaudited
(restated)
US$’000 US$’000
Profit/l(loss) for the period 8,751 (1,151)
Currency translation differences arising on translations of F foreign
operations items which will or may be reclassified to
(1,493) (1,649)
profit or loss
7,258 (2,800)
Total comprehensive profit/(loss) for the period
attributable to equity shareholders
ALTYNGOLD PLC
Consolidated statement of financial position
Six months Year ended
ended 30 June 31 December
2021 2020
Notes
(unaudited) (audited)
US$’000 US$’000
Non-current assets
Intangible assets 5 13,016 12,849
Property, plant and equipment 6 33,163 32,092
Other receivables 7 5,996 6,700
Deferred tax asset 4,026 5,311
Restricted cash 13 13
56,214 56,965
Current assets
Inventories 8,522 5,468
Trade and other receivables 7 12,874 7,182
Cash and cash equivalents 3,478 7,154
24,874 19,804
Total assets 81,088 76,769
Current liabilities
Trade and other payables (6,111) (6,705)
Provisions (186) (151)
Borrowings 10 (3,238) (5,833)
(9,535) (12,689)
Net current assets 15,339 7,115
Non-current liabilities
Other financial liabilities & payables (388) (722)
Provisions (5,082) (4,763)
Borrowings 10 (23,490) (23,260)
(28,960) (28,745)
Total liabilities (38,495) (41,434)
Net assets 42,593 35,335
Equity
Called-up share capital 4,267 4,267
Share premium 152,839 152,839
Merger reserve (282) (282)
Other reserve 333 333
Currency translation reserve (54,452) (52,959)
Accumulated loss (60,112) (68,863)
Total equity 42,593 35,335
The financial information was approved and authorised for issue by the Board
of Directors on 3 September 2021 and was signed on its behalf by:
Aidar Assaubayev – Chief Executive Officer
ALTYNGOLD PLC
Consolidated statement of changes of equity
Share capital Share Merger Currency Share based Other Accumulated
premium reserve translation payment reserves losses Total
reserve reserve
Unaudited US$'000 US$'000 US'000 US$'000 US$'000 US$'000 US$'000 US$'000
At 1 January 2021 4,267 152,839 (282) (52,959) - 333 (68,863) 35,335
Profit for the period - - - - - - 8,751 8,751
Exchange differences on translating foreign operations - - - (1,493) - - (1,493)
Total comprehensive profit for the period - - - (1,493) - - 8,751 7,258
At 30 June 2021 4,267 152,839 (282) (54,452) - 333 (60,112) 42,593
Unaudited US$'000 US$'000 US'000 US$'000 US$'000 US$'000 US$'000 US$'000
At 1 January 2020 4,055 151,476 (282) (48,102) - 333 (74,201) 33,279
Profit for the period - - - - - - 1,249 1,249
Other comprehensive loss - - - (1,649) - - (1,649)
Total comprehensive loss for the period - - - (1,649) - 1,249 (400)
New share capital subscribed 13 62 - - - - - 75
At 30 June 2020 as previously reported 4,068 151,538 (282) (49,751) 333 (72,952) 32,954
Share based payment (see note 1) - - - - 2,400 - (2,400) -
Loss for the period restated - - - - - - (1,151) (1,151)
Total comprehensive loss for the period – as restated - - - - - (1,151) (1,151)
At 30 June 2020 as restated 4,068 151,538 (282) (49,751) 2,400 333 (75,352) 32,954
Audited US$'000 US$'000 US'000 US$'000 US$'000 US$’000 US$'000 US$'000
At 1 January 2020 4,055 151,476 (282) (48,102) - 333 (74,201) 33,279
Loss for the year - - - - - - 2,938 2,938
Other comprehensive loss - - - (4,857) - - (4,857)
Total comprehensive loss for the year - - - (4,857) - - 2,938 (1,919)
Share based payment charge - - - - 2,400 - - 2,400
Share options exercised 199 11 1,301 - (2,400) - 2,400 1,500
New share capital subscribed 13 6 2 - - - - - 75
At 31 December 2020 4,267 152,839 (282) (52,959) - 333 (68,863) 35,335
ALTYNGOLD PLC
Consolidated statement of cash flows
Six months ended Six months ended
30 June 2021 30 June 2020
(unaudited) (unaudited)
Note US$’000 US$’000
Net cash inflow from operating activities 8 1,819 1,280
Investing activities
Purchase of property, plant and equipment *(2,133) (6,371)
Acquisition of intangible assets (375) (265)
Net cash used in investing activities
(2,508) (6,636)
Financing activities
Loans received 4,641 13,956
Loans repaid (6,518) (1,711)
Interest paid (1,120) (949)
Net cash flow (decrease)/increase from financing activities
(2,997) 11,296
(Decrease)/increase in cash and cash equivalents (3,686) 5,940
Cash and cash equivalents at the beginning of the period
7,154 105
Effect of exchange rate fluctuations on cash held 10 -
Cash and cash equivalents at end of the period/year 3,478 7,874
* Cash paid to purchase property, plant and equipment represents additions of
US$4.2m (note 6) plus a decrease in trade payables of $0.3m less by a decrease
in prepayments for equipment of $2.4m (Note 7).
ALTYNGOLD PLC
Notes to the consolidated financial information
1. Basis of preparation
General
AltynGold Plc (the “Company”) is a Company incorporated in England and
Wales under the Companies Act 2006. The address of its registered office, and
place of business of the Company and its subsidiaries is set out within the
Company information at the end of this interim report
The Company is registered and domiciled in England and Wales, whose shares are
publicly traded on the London Stock Exchange. The interim financial results
for the period ended 30 June 2021 are unaudited. The financial information
contained within this report does not constitute statutory accounts as defined
by Section 434(3) of the Companies Act 2006.
This interim financial information of the Company and its subsidiaries (“the
Group”) for the six months ended 30 June 2021 have been prepared, in
accordance with the UK-adopted International Accounting Standard 34, 'Interim
Financial Reporting' and the Disclosure Guidance and Transparency Rules
sourcebook of the United Kingdom’s Financial Conduct Authority, and on a
basis consistent with the accounting policies set out in the Group's
consolidated annual financial statements for the year ended 31 December 2020.
It has not been audited, does not include all of the information required for
full annual financial statements, and should be read in conjunction with the
Group's consolidated annual financial statements for the year ended 31
December 2020 , which has been prepared in accordance with both
“international accounting standards in conformity with the requirements of
the Companies Act 2006” and “international financial reporting standards
adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European
Union”.
These interim financial statements do not comprise statutory accounts within
the meaning of section 434 of the Companies Act 2006. Statutory accounts for
the year ended 31 December 2020 were approved by the board of directors on 30
April 2021 and delivered to the Registrar of Companies. The report of the
auditors on those accounts was unqualified, did not contain an emphasis of
matter paragraph and did not contain any statement under section 498 of the
Companies Act 2006.
The financial statements have been reviewed, not audited.
The financial information is presented in US Dollars and has been prepared
under the historical cost convention. On 31 December 2020, IFRS as adopted by
the European Union at that date was brought into UK law and became UK-adopted
international accounting standards, with future changes being subject to
endorsement by the UK Endorsement Board. AltynGold Plc transitioned to
UK-adopted international accounting standards in its consolidated financial
statements on 1 January 2021. There was no impact or changes in accounting
policies from the transition.
The same accounting policies, presentation and method of computation together
with critical accounting estimates, assumptions and judgements are followed in
this consolidated financial information as were applied in the Group's latest
annual financial statements except that in the current financial year, the
Group has adopted a number of revised Standards and Interpretations. However,
none of these have had a material impact on the Group. In addition, the IASB
has issued a number of IFRS and IFRIC amendments or interpretations since the
last annual report was published. It is not expected that any of these will
have a material impact on the Group.
Prior period adjustments
Share based payment
The prior period has been adjusted to account for the fair value of the grant
of share options made on 30 June 2020, which was not accounted for in that
period. This has resulted in a charge to the profit and loss account of
US$2.4m at 30 June 2020 with a corresponding credit entry to the share based
payment reserve in the statement of changes in equity. There was no impact on
the equity attributable to shareholders as at 30 June 2020 which remained
unchanged at US$32.9m
The share options were exercised in October 2020 resulting in the transfer of
the share based payment reserve to accumulated losses.
ALTYNGOLD PLC
Notes to the consolidated financial information (continued)
Going concern
During the current period the Group has been able to grow its turnover and
profitability, increasing production facilitated by the capital expenditure
funded by the borrowings which the Group has been able to reduce by US2.4m,
and which now stand at US$26.7m. The resultant increase in cash flow and
adjusted EBITDA which has moved up from US$5m to US$13.4m has enabled the
Group to maintain cash reserves and repay the bonds during the year which
amounted to US$2.3m.
At the period end the Group had cash resources of US$3.5m (31 December 2020:
US$7.2m). The Board have reviewed the Group’s cash flow forecasts for the
period to December 2022. The forecasts are based on the current approved
budgets taking in to account any adjustments from current trading. The
principal capital costs have now been made and the Directors are of the
opinion that the current cash balances and cash generated from operations will
be sufficient to for the Group to meet its cash flow requirements.
As reported in the 2020 Annual Report there has been minimal disruption at
present from the effects of COVID-19 on the operations of the Group. However
the Board are mindful that this is a constantly changing and evolving
situation that needs to be kept under constant review. As such the existing
arrangements in relation to all stakeholders to include employees, suppliers
and customers are monitored to ensure there is no disruption in the
operations.
The Board have considered as at the period end possible stress case scenarios
that they consider may likely impact the Group’s operations, financial;
position and forecasts. As at the year-end these are seen as being, illness of
the employees, disruption to supply chains in and out of the group, impacting
the production and possible falls in gold prices.
From the analysis undertaken the Board have concluded that the Group will be
able to continue to trade based on its existing resources. The stress tests
included a drop in the gold price of 10% from the current gold price and
budgeted production by 20%, in both scenarios and combination of both together
it was concluded that the Group had sufficient cash reserves to continue to
operate. The Board therefore considers it appropriate to adopt the going
concern basis of accounting in preparing these financial statements.
2. Segmental information
Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision maker. The chief operating
decision maker, who is responsible for allocating resources and assessing
performance of the operating segments and making strategic decision, has been
identified as the Board of Directors.
The Board of Directors consider there to be two operating segments, the
exploration and development of mineral resources at Sekisovskoye and at
Teren-Sai, both based in one geographical segment, being Kazakhstan. All sales
were made in Kazakhstan from the mine at Sekisovskoye. However in relation to
Teren-Sai as there is discrete financial information available and the assets
account for greater than 10% of the combined total assets of all segments it
is considered to be a separate operating segment.
Teren-Sai is an exploration asset, details of the carrying value of the asset
are shown in note 5.
3. Profit/(loss) per ordinary share
Basic profit/(loss) per share is calculated by dividing the profit/(loss)
attributable to ordinary shareholders by the weighted average number of
ordinary shares outstanding during the period. The weighted average number of
ordinary shares and retained profit/(loss) for the financial period for
calculating the basic loss per share for the period are as follows:
Six months Six months
ended 30 ended 30
June 2021 June 2020
(restated)
(unaudited) (unaudited)
The basic weighted average number of ordinary shares in issue during the
period
27,332,933 *25,697,036
The profit/(loss) for the period attributable to equity shareholders
(US$’000s)
8,751 (1,151)
*Restated to reflect the 100:1 consolidation of shares in October 2020.
4. Alternative performance measures
The Directors have presented the alternative performance measures adjusted
EBITDA , operating cash cost and total cash cost as they monitor these
performance measures at a consolidated level and the Directors believe it is
relevant in measuring the Group’s performance.
A reconciliation of the alternative performance measures is shown below.
Adjusted EBITDA, operating cash cost and total cash cost are not defined
performance measures in IFRS. The Group’s definition of adjusted these may
not be comparable with similar titled performance measures as disclosed by
other entities.
Adjusted EBITDA Six months Six months
ended 30 June ended 30 June
2021 2020
(unaudited) (unaudited)
US$000's (restated)
US $000's
Profit/(loss) before taxation 9,261 (1,151)
Adjusted for
Finance expense 1,676 867
Depreciation of tangible fixed assets 2,167 1,947
Share based payment - 2,400
Foreign currency translation 278 890
Adjusted EBITDA 13,382 4,953
Operating cash cost
US$ US$
Cost of sales 9,037 7,571
Adjusted for
Depreciation of tangible fixed assets (2,167) (1,947)
6,870 5,624
Gold sold in the period per oz 12,560 6,790
Operating cash cost per oz 546 828
Total cash cost
Cost of sales 9,037 7,571
Adjusted for
Administrative expenses 2,758 918
Depreciation of tangible fixed assets (2,167) (1,947)
9,628 6,542
Gold sold in the period per oz 12,560 6,790
Total cash cost per oz 766 963
5. Intangible assets Teren-Sai Exploration and US$'000
geological data evaluation costs
Cost
1 January 2020 9,931 7,488 17,419
Additions - 1,271 1,271
Amortisation capitalised - 608 608
Currency translation adjustment (905) (717) (1,622)
December 2020 9,026 8,650 17,676
Additions - 375 375
Amortisation capitalised - 324 324
Transfer - (165) (165)
Currency translation adjustment (145) (140) (285)
30 June 2021 8,881 9,044 17,925
Accumulated amortisation
1 January 2020 4,476 - 4,476
Charge for the period 608 - 608
Currency translation adjustment (422) - (422)
Revenue relating to production 165 165
31 December 2020 4,662 165 4,827
Charge for the period 324 - 324
Transfer to cost - (165) (165)
Currency translation adjustment (77) (77)
30 June 2021 4,909 - 4,909
Net books values
30 June 2021 3,972 9,044 13,016
31 December 2020 4,364 8,485 12,849
The intangible assets relate to the historic geological information pertaining
to the Teren-Sai ore fields. The ore fields are located in close proximity to
the current open pit and underground mining operations of Sekisovskoye. In May
2016 the Company was awarded an exploration and evaluation contract, which is
valid for six years, with a right to extend for a further 6 years, with the
right to extend for another 5 years if there is a commercial discovery of
resources. It is the intention of the Company to extend the licence and the
necessary documentation is being prepared. Ongoing costs in relation to
exploration and evaluation are capitalised.
6. Property, plant and equipment
Mining properties Freehold land Plant, Assets under Total
and and Equipment fixtures construction
leases buildings and fittings
US$000
US$000 US$000 US$000 US$000
Cost
1 January 2020 13,949 24,786 17,446 1,067 57,248
Additions 1,622 166 5,555 1,246 8,589
Disposals - - (250) - (250)
Transfers (764) -- 1,383 1,3811,383 (8) (471) 140
Transfer from inventories - -- -1,383 - 241 241
Currency translation adjustment (1,543) (2,285) (1,641) (110) (5,579)
31 December 2020 13,264 24,050 21,102 1,973 60,389
Additions 1,761 103 1,633 745 4,242
Disposals - - - - -
Transfers 161 652 67 (652) (6531) 228
Transfer to inventories - - -1,383 - (365) (365)
Currency translation adjustment (325) (410) (346) (29) (1,110)
30 June 2021 14,861 24,395 22,456 1,672 63,384
Accumulated depreciation
1 January 2020 2,441 10,563 13,928 - 26,932
Charge for the period 520 1,885 1,545 - 3,950
Disposals - - (250) - (250)
Transfers 140 (80) 80 - 140
Currency translation adjustment (232) (997) (1,246) - (2,475)
1 December 2020 2,869 11,371 14,057 - 28,297
Charge for the period 299 1,074 794 - 2,167
Transfers 161 - 67 - 228
Currency translation adjustment (54) (191) (226) - (471)
30 June 2021 3,275 12,254 14,692 - - 30,221
Carrying amount
30 June 2021 11,586 12,141 7,764 1,672 33,163
31 December 2020 10,395 12,679 7,045 1,973 32,092
ALTYNGOLD PLC
Notes to the consolidated financial information (continued)
7. Trade and other receivables
Non-current
30 June 31 December
2021 2020
(unaudited) (audited)
US$000's US $000's
VAT recoverable 3,436 1,705
Prepayments- advances to suppliers for equipment 2,560 4,995
5,996 6,700
The amount recoverable in relation to Value Added Tax is expected to be
recovered by offset against VAT payable in future periods.
Current
30 June 31 December
2021 2020
(unaudited) (audited)
US$000's US $000's
Trade receivables 783 -
VAT recoverable 4,199 3,549
Prepayments- advances to suppliers 7,884 2,826
Other receivables – recoverable 23 823
Other receivables – provision (15) (16)
12,874 7,182
Prepayments have increased as a result of advance payments to suppliers for
parts and consumables.
8. Notes to the cash flow statement
Six months Six months
ended 30 June ended 30 June
2021 2020
(unaudited) (unaudited)
(restated)
US$000's US $000's
Profit/(loss) before taxation 9,261 (1,151)
Adjusted for
Finance expense 1,676 867
Depreciation of tangible fixed assets 2,167 1,947
Increase in inventories (2,689) (2,424)
Increase in trade receivables (7,641) (102)
Decrease in trade and other payables (1,233) (1,147)
Share based payment - 2,400
Foreign currency translation 278 890
Cash inflow from operations 1,819 1,280
Income taxes - -
1.819 1,280
9. Related party transactions
Remuneration of key management personnel
The remuneration of the Directors, who are the key management personnel of the
Group, is set out below in aggregate for each of the categories specified in
IAS 24 - “Related Party Disclosures”. The total amount remaining unpaid
with respect to remuneration of key management personnel amounted to US$77,000
(31 December 2020 US$52,000).
Six months Six months
ended 30 Ended 30
June 2021 June 2020
US$000 US$000
Short term employee benefits 66 35
66 35
Social security costs 2 2
68 37
During the period, the following transactions were connected with Company’s
in which the Assaubayev family have a controlling interest:
* An amount is owing to Asia Mining Group of US$nil, (31 December 2020:
US$85,892) and is included within trade payables.
* Loan amounts due by the Group to Amrita Investments Limited a company
controlled by the Assaubayev family, total US$nil (31 December 2020
US$45,000). The 10% convertible bond and interest due to Amrita Investments of
U$1,559,250 was repaid in May 2021 as per the terms of the bond, (31 December
2020 US$1,525,747).
* The balance of the 10% convertible bond issued to African Resources Limited
amounting to US$297,000 (including accrued interest) was repaid in May 2021.
10 . Borrowings
Six months Year ended
ended 30 June 31 December
2021 2020
(unaudited) (audited)
US$000's US $000's
Current loans and borrowings
Bonds - 2,882
Bank loans 3,238 2,906
Related party loans - 45
3,238 5,833
Due one-two years
Bonds 9,458 9,317
Bank loans 5,348 2,997
14,806 12,314
Due two-five years
Bank loans 8,684 8,990
8,684 8,990
Due more than five years
Bank loans - 1,956
- 1,956
Total non-current loans and borrowings 23,490 23,260
Bond Listed on Astana International Exchange
The total number of bonds at the period end amounted to US$10m at a coupon
rate of 9%, the bonds are repayable in December 2022. At the year end the
carrying value approximates to their fair value.
Bank loans
The Company has an agreed a facility with JSC Bank Center Credit (BCC) for an
amount of US$17m. The bank loan is repayable in instalments over a term of 7
years and bears interest at 6%-7%, capital repayments commenced in October
2020.
In addition on 30 December 2020 the Company agreed a new facility with BCC of
US$5.5m (2.3bln Tenge), of this amount US$3.6m has to be utilised to purchase
equipment and the balance of US$1.9m for working capital purposes. US$973,000
was drawn down in December 2020, the balance of the loan was drawn down in
2021. The loan is denominated in Kazakh Tenge with interest at 15.5% repayable
in instalments over 5 years with a 6 month capital repayment holiday.
The bank loan is secured over the assets of the Group.
11. Reserves
A description and purpose of reserves is given below:
Reserve Description and purpose
Share capital Amount of the contributions made by shareholders in return for the issue of
shares.
Share premium Amount subscribed for share capital in excess of nominal value.
Share based payment Amount accrued in relation to the share based payment charge relating to the
share options issued.
Merger Reserve Reserve created on application of merger accounting under a previous GAAP.
Currency translation reserve Gains/losses arising on re-translating the net assets of overseas operations
into US Dollars.
Accumulated losses Cumulative net gains and losses recognised in the consolidated statement of
financial position.
12. Events after the balance sheet date
There were no significant post balance sheet events to report.
This report will be available on our website at www.altyngold.uk
(https://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.altyngold.uk&esheet=52486603&newsitemid=20210905005016&lan=en-US&anchor=www.altyngold.uk&index=2&md5=9080621e29c5bcecb33eb0c116d2b528)
ALTYNGOLD PLC
Company information
Directors Kanat Assaubayev Chairman
Aidar Assaubayev Chief executive officer
Sanzhar Assaubayev Executive director
Ashar Qureshi Non-executive director
Thomas Gallagher Non-executive director
Victor Shkolnik Non-executive director
Secretary Rajinder Basra
Registered office and number Company number: 05048549
28 Eccleston Square
London
SW1V 1NZ
Telephone: +44 208 932 2455
Company website www.altyngold.uk
(https://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.altyngold.uk&esheet=52486603&newsitemid=20210905005016&lan=en-US&anchor=www.altyngold.uk&index=3&md5=288e68ba149cc081b01c6a7206ca3246)
Kazakhstan office 10 Novostroyevskaya
Sekisovskoye Village
Kazakhstan
Telephone: +7 (0) 72331 27927
Fax: +7 (0) 72331 27933
Auditor BDO LLP,
55 Baker Street,
London W1U 7EU
Registrars Neville Registrars
Neville House
Steelpark Road
Halesowen
West Midlands B62 8HD
Telephone: +44 (0) 121 585 1131
Bankers NatWest Bank plc
London City Commercial Business Centre
7th Floor, 280 Bishopsgate
London
EC2M 4RB
LTG Bank AG
Herrengasse 12
FL-9490, Vaduz
Principal of Liechtenstein
View source version on businesswire.com:
https://www.businesswire.com/news/home/20210905005016/en/
(https://www.businesswire.com/news/home/20210905005016/en/)
Altyn Plc
Copyright Business Wire 2021Recent news on Altyngold
See all newsREG-AltynGold Plc Launch New Website
AnnouncementREG-AltynGold Plc Annual Financial Report
AnnouncementREG-AltynGold Plc Q4 production results
AnnouncementREG-AltynGold Plc 3rd Quarter Results
AnnouncementREG-AltynGold Plc Half-year Report
Announcement