REG - Atalaya Mining PLC - Q3 2021 Financial Results
18/11/2021 07:00
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RNS Number : 7522S Atalaya Mining PLC 18 November 2021
18 November 2021
Atalaya Mining Plc.
("Atalaya" and/or the "Company")
Q3 2021 Financial Results
Atalaya Mining Plc (AIM: ATYM; TSX: AYM), is pleased to announce its quarterly
and nine-month results for the period ended 30 September 2021 ("Q3 2021" and
"YTD 2021" respectively), together with its unaudited interim condensed
consolidated financial statements for the year to date.
The Unaudited Interim Condensed Consolidated Financial Statements for the
three and nine months ended 30 September 2021 are also available under the
Company´s profile on SEDAR at www.sedar.com (http://www.sedar.com) and on
Atalaya`s website at www.atalayamining.com (http://www.atalayamining.com) .
YTD Financial Highlights
· EBITDA increased to €148.2 million in YTD 2021 (YTD 2020:
€44.4 million) and cash flows from operating activities increased to
€129.2 million for YTD 2021 (YTD 2020: €41.8 million) as a result of
robust operational performance at Proyecto Riotinto and strong copper prices.
· Following the increased 2021 production guidance as announced on
13 October 2021, the Company is also updating its 2021 cost guidance, with
cash costs now expected to be in the range of US$2.15/lb - US$2.25/lb and
AISC now expected to be at the low end of the previous guidance range of
US$2.50/lb - US$2.65/lb.
· Total cash as at 30 September 2021 was €140.9 million
(including restricted cash of €15.4 million), up from €37.8 million as at
31 December 2020. Atalaya maintains a strong balance sheet with net cash of
€88.9 million as at 30 September 2021.
· On 27 October 2021, the Board of Directors declared an Inaugural
Dividend of US$0.395 per ordinary share, equivalent to £0.294 per share or
€0.345 per share.
Quarter ended 30 September Q3 2021 Q3 2020 Nine months ended Nine months ended
30 Sep 2021 30 Sep 2020
Revenues from operations €k 107,161 65,836 304,265 183,569
Operating costs €k (58,362) (43,571) (156,054) (139,196)
EBITDA €k 48,799 22,265 148,211 44,373
Profit after tax for the period €k 38,206 12,237 104,199 18,203
Basics earnings per share € cents/share 27.5 9.0 75.9 13.7
Dividend per share $/share 0.395 - 0.395 -
Cash flows from operating activities €k 58,213 18,820 129,212 41,820
Cash flows used in investing activities €k (6,982) (6,338) (77,835) (19,669)
Cash flows used in financing activities €k (3,131) (15,085) 51,710 (454)
Net cash / (debt) position ((1)) €k 88,854 (23,226) 88,854 (23,226)
Working capital surplus €k 126,891 25,002 126,891 25,002
Average realised copper price $/lb 4.31 2.72 4.08 2.60
Cu concentrate produced (tonnes) 64,262 66,091 206,018 187,032
Cu production (tonnes) 13,893 14,695 42,225 41,559
Cash costs $/lb payable 2.19 1.94 2.16 1.93
All-In Sustaining Cost $/lb payable 2.48 2.20 2.49 2.17
((1) )Includes restricted cash and bank borrowings at 30
September 2021 and includes Deferred Consideration at 30 September 2020.
Q3 Financial Highlights
· Revenues for Q3 2021 increased to €107.2 million compared with
€65.8 million for the three months ended 30 September 2020 ("Q3 2020").
Higher revenues were the result of increased realised copper prices and
slightly larger volumes of concentrate sold.
· Operating costs during Q3 2021 were €58.4 million compared with
€43.6 million in Q3 2020. This increase mainly reflects the higher volumes
of waste mined at greater unit costs at Proyecto Riotinto.
· Despite the increase in operating costs, EBITDA for Q3 2021
increased to €48.8 million compared with €22.3 million in Q3 2020 driven
by the larger volume of concentrate sold and higher copper prices.
· Cash costs for Q3 2021 were $2.19/lb of payable copper, higher
than in Q3 2020 ($1.94/lb). This increase is mainly the result of higher
volumes of waste mined plus higher freight rates.
· All-in Sustaining Costs ("AISC") during Q3 2021 amounted to
$2.48/lb of payable copper, higher than Q3 2020 at $2.20/lb. The increase in
AISC was mainly driven by the same impacts as those for cash costs. Reported
AISC excludes one-off investments in the tailings dam, which amounted to
€2.8 million for the quarter (Q3 2020: €2.5 million).
· Inventories of concentrate as at 30 September 2021 amounted to
€3.6 million (€6.7 million at 31 December 2020).
· Working capital surplus as at 30 September 2021 of €126.9
million, representing a €144.8 million increase from a €17.9 million
deficit as at 31 December 2020. The increase was mainly due to the cash
generated from concentrate sold in the period supported by higher copper
prices, as well as the use of long term borrowings to finance the payment of
the deferred consideration which was classified as short term as at 31
December 2020.
· Total cash balances at 30 September 2021 comprised unrestricted
cash balances of €125.4 million and restricted cash balances of €15.4
million. Total cash balances at 31 December 2020 of €37.8 million were
wholly unrestricted.
· Net cash flow from operating activities was €58.2 million for
Q3 2021 compared with €18.8 million during Q3 2020. Cash flows from
operating activities were €129.2 million for YTD 2021 compared with €41.8
million for the same period in 2020.
· Net cash flow used for investing activities amounted to outflows
of €7.0 million and €77.8 million for Q3 2021 and YTD 2021, respectively,
compared with outflows of €6.3 million and €19.7 million for the same
periods in the prior year. Cash outflows for YTD 2021 mostly relate to the
€53 million paid to Astor in Q1 2021, sustaining capex and investments in
the tailings dam.
· Net cash flow from financing activities amounted to an outflow of
€3.1 million and an inflow of €51.7 million for Q3 2021 and YTD 2021
respectively, compared with outflows of €15.1 million and €0.5 million,
respectively, for the same periods in the previous year. The cash generated
from financing activities of €51.7 million for YTD 2021 included unsecured
facilities to fund the payment to Astor in Q1 2021.
Dividend
· An inaugural dividend of approximately $0.395 per share was
declared on 27 October 2021. The Inaugural Dividend is for the nine months
ended 30 September 2021.
· The Company's Board of Directors also approved a future dividend
policy which will take effect in financial year 2022 and make an annual
pay-out of between 30% and 50% of free cash flow generated during the
applicable financial year.
Q3 Operational Highlights
Proyecto Riotinto
· Copper production during Q3 2021 was 13,893 tonnes, a modest
decrease from Q3 2020 due to planned maintenance stoppages. Copper production
for YTD 2021 was 42,225 tonnes compared with 41,559 tonnes during YTD 2020.
· Ore processed during Q3 2021 was 3.9 million tonnes, in line with
Q3 2020 when ore processed amounted to 4.0 million tonnes. Total ore processed
during YTD 2021 amounted to 12.0 million tonnes (YTD 2020: 11.0 million
tonnes).
· During Q3 2021, some cost reduction initiatives were implemented
including an expert system to control the SAG mill operation that resulted in
lower energy consumption as well as an associated reduction of CO2 emissions.
· Permitting of a 50 MW solar plant for self-consumption has
advanced significantly and final permits are expected in the coming weeks,
with construction to start immediately after. The selection of construction
contractor for the solar plant is ongoing.
· Flotation improvements are being investigated with the use of new
reagents focused on increased recoveries.
Proyecto Touro
· All of the documents and reports required for the environmental
evaluation of the new project design for Touro have been reviewed and prepared
for filing. The new project design includes initiatives to eliminate the water
over the thickened tailings that will be stored in a plastic lined basin with
zero water discharge. Initiatives to treat the water runoff from the
historic mine will be implemented with the new project.
· The Company continues to be confident that its approach to
Proyecto Touro is in line with international best practice and has been
engaging in recent months with local and regional stakeholders prior to the
public consultation period that will commence once the Environmental Impact
Evaluation starts for the new project.
Proyecto Masa Valverde
· As announced on 6 October 2021, exploration work continues at
Proyecto Masa Valverde, which includes the Masa Valverde polymetallic deposit,
the Majadales discovery and the unexplored Campanario-Descamisada area.
· Following positive drilling results, including high grade
intercepts within broad intervals of massive and stockwork type polymetallic
sulphide mineralisation at both Masa Valverde and Majadales, the Company has
decided to expand its drilling campaign beyond the 8,000 metres originally
planned. Updates on the drilling results will be disclosed to the market in
due course and as appropriate.
· These drilling results will be incorporated into the NI 43-101
compliant report for Proyecto Masa Valverde that is currently being prepared
by CSA Global and expected by early Q1 2022.
Proyecto Riotinto Este
· Investigation permits were granted during 2021 and the Company
now has access to two of the three investigation permits at Riotinto Este:
Cerro Negro and Los Herreros. The third investigation permit, Peñas Blancas,
continues to progress and is expected to be granted in the coming months.
· An electromagnetic airborne geophysical survey has started. The
survey will cover the investigation permits area located immediately east of
Proyecto Riotinto and along the same structural and stratigraphic setting.
E-LIX Update
· The E-LIX pilot plant continues to operate and gather data as
planned, demonstrating the potential range of applications for this
technology, which enables the processing of copper and zinc concentrates to
produce cathodes on site.
· The feasibility study for the construction of an industrial plant
has shown initial results that are encouraging and a process of iterative
optimization review is ongoing.
· The Company is currently evaluating development options with the
inventor and owner of the ELIX System, LAIN Technologies, with the aim of
constructing a phased industrial plant.
Reserves and Resources Updates at Proyecto Riotinto
· Following an independent reserve estimate which confirmed a long
mine life at the Cerro Colorado open pit, studies have advanced focusing on
the addition of new resources contained in satellite deposits at Proyecto
Riotinto.
· Work is ongoing on the preparation of a NI 43-101 compliant
technical report for the Cerro Colorado, San Dionisio and San Antonio
deposits. A large portion of the resources at San Dionisio are potentially
mineable by open pit and further polymetallic mineralization could be
exploited using underground mining methods at both the San Dionisio and San
Antonio deposits.
Outlook 2021
· As a result of the strong performance at Proyecto Riotinto
year-to-date, the Company increased its 2021 copper production guidance to
54,000 - 56,000 tonnes, as previously announced on 13 October 2021.
· The Company is also providing updated cost guidance for 2021.
Cash costs are now expected to be in the range of US$2.15/lb - US$2.25/lb
(from US$2.25/lb - US$2.35/lb previously) and AISC is now expected to be at
the low end of the previous guidance range of US$2.50/lb - US$2.65/lb.
COVID-19 Update
· Management continues to monitor the impact of COVID-19 on the
operations and the ongoing cost structure and will update the market with any
changes in expectations.
Alberto Lavandeira, CEO commented:
"I am pleased to report another strong quarter and year-to-date for Atalaya
Mining. Robust operational performance, combined with strong copper prices,
has seen our EBITDA for the first nine months of 2021 more than triple from
the amount generated during the same period of 2020. We have also greatly
strengthened our balance sheet, with net cash of €89 million at the end of
Q3 2021.
This continued strong performance, underpinned by our solid balance sheet,
makes us confident we will achieve our increased 2021 copper production
guidance of between 54,000 - 56,000 tonnes.
The announcement of our inaugural dividend in October also expresses the
confidence the Board has for Atalaya's future and allows us to reward our
loyal shareholders for their continued support while at the same time growing
the Company."
Investor Presentation Reminder
Alberto Lavandeira and César Sánchez (CFO) will be holding a live
presentation regarding the Q3 2021 results via the Investor Meet Company
platform at 11:00 GMT today. To register please visit the following link and
click on "Add to Meet" Atalaya:
https://www.investormeetcompany.com/atalaya-mining-plc/register-investor
(https://www.investormeetcompany.com/atalaya-mining-plc/register-investor)
Investors who already follow Atalaya on the Investor Meet Company platform
will automatically be invited.
This announcement contains information which, prior to its publication
constituted inside information for the purposes of Article 7 of Regulation
(EU) No 596/2014.
Contacts:
SEC Newgate UK Elisabeth Cowell / Tom Carnegie + 44 20 3757 6880
4C Communications Carina Corbett +44 20 3170 7973
Canaccord Genuity (NOMAD and Joint Broker) Henry Fitzgerald-O'Connor / James Asensio +44 20 7523 8000
BMO Capital Markets (Joint Broker) Tom Rider / Andrew Cameron +44 20 7236 1010
Peel Hunt LLP (Joint Broker) Ross Allister / David McKeown +44 20 7418 8900
About Atalaya Mining Plc
Atalaya is an AIM and TSX-listed mining and development group which produces
copper concentrates and silver by-product at its wholly owned Proyecto
Riotinto site in southwest Spain. Atalaya's current operations include the
Cerro Colorado open pit mine and a modern 15 Mtpa processing plant, which has
the potential to become a centralised processing hub for ore sourced from its
wholly owned regional projects around Riotinto that include Proyecto Masa
Valverde and Proyecto Riotinto East. In addition, the Group has a phased,
earn-in agreement for up to 80% ownership of Proyecto Touro, a brownfield
copper project in the northwest of Spain. For further information, visit
www.atalayamining.com (http://www.atalayamining.com)
Management's review
(All amounts in Euro thousands unless otherwise stated)
For the period ended 30 September 2021 and 2020
Notice to Reader
The accompanying unaudited interim condensed consolidated financial statements
of Atalaya Mining Plc have been prepared by and are the responsibility of
Atalaya Mining Plc's management. The unaudited interim condensed consolidated
financial statements have not been reviewed by Atalaya's auditors.
Introduction
This report provides an overview and analysis of the financial results of
operations of Atalaya Mining Plc and its subsidiaries ("Atalaya" and/or
"Group"), to enable the reader to assess material changes in the financial
position between 31 December 2020 and 30 September 2021 and results of
operations for the three and nine months ended 30 September 2021 and 2020.
This report has been prepared as of 17 November 2021. The analysis, hereby
included, is intended to supplement and complement the unaudited interim
condensed consolidated financial statements and notes thereto ("Financial
Statements") as at and for the period ended 30 September 2021. The reader
should review the Financial Statements in conjunction with the review of this
report and with the audited, consolidated financial statements for the year
ended 31 December 2020, and the unaudited interim condensed consolidated
financial statements for the period ended 30 September 2020. These documents
can be found on SEDAR at www.sedar.com (http://www.sedar.com) and on Atalaya's
website at www.atalayamining.com (http://www.atalayamining.com) .
Atalaya prepares its Annual Financial Statements in accordance with
International Financial Reporting Standards ("IFRSs") as adopted by EU and its
Unaudited Interim Condensed Consolidated Financial Statements in accordance
with International Accounting Standards 34: Interim Financial Reporting. The
currency referred to in this document is the Euro, unless otherwise specified.
Forward-looking statements
This report may include certain "forward-looking statements" and
"forward-looking information" under applicable securities laws. Except for
statements of historical fact, certain information contained herein constitute
forward-looking statements. Forward-looking statements are frequently
characterised by words such as "plan", "expect", "project", "intend",
"believe", "anticipate", "estimate", and other similar words, or statements
that certain events or conditions "may" or "will" occur. Forward-looking
statements are based on the opinions and estimates of management at the date
the statements are made, and are based on a number of assumptions and subject
to a variety of risks and uncertainties and other factors that could cause
actual events or results to differ materially from those projected in the
forward-looking statements. Assumptions upon which such forward-looking
statements are based include that all required third party regulatory and
governmental approvals will be obtained. Many of these assumptions are based
on factors and events that are not within the control of Atalaya and there is
no assurance they will prove to be correct. Factors that could cause actual
results to vary materially from results anticipated by such forward-looking
statements include changes in market conditions and other risk factors
discussed or referred to in this report and other documents filed with the
applicable securities regulatory authorities. Although Atalaya has attempted
to identify important factors that could cause actual actions, events or
results to differ materially from those described in forward-looking
statements, there may be other factors that cause actions, events or results
not to be anticipated, estimated or intended. 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
statements. Atalaya undertakes no obligation to update forward-looking
statements if circumstances or management's estimates or opinions should
change except as required by applicable securities laws. The reader is
cautioned not to place undue reliance on forward-looking statements.
1. Incorporation and description of the Business
Atalaya was incorporated in Cyprus on 17 September 2004 as a private company
with limited liability under the Companies Law, Cap. 113 and was converted to
a public limited liability company on 26 January 2005. Its registered office
is at 1 Lampousa Street, Nicosia, Cyprus.
The Company was listed on AIM of the London Stock Exchange ("AIM") in May 2005
under the symbol ATYM and on the Toronto Stock Exchange ("TSX") on 20 December
2010 under the symbol AYM. The Company continued to be listed on AIM and the
TSX as at 30 September 2021.
Atalaya is a European mining and development company and currently owns three
mining projects: Proyecto Riotinto which includes other satellite projects in
the Proyecto Riotinto District, Proyecto Touro and Proyecto Masa Valverde. In
addition, the Company has an earn-in agreement to acquire three investigation
permits at Proyecto Riotinto Este.
Proyecto Riotinto
Proyecto Riotinto, wholly owned by the Company's subsidiary Atalaya Riotinto
Minera, S.L.U., is located in Huelva, Spain. The Group operates the Cerro
Colorado open pit mine and its associated processing plant where copper in
concentrate and silver by-product is produced. A brownfield expansion of the
plant was completed in 2019 and successfully commissioned in Q1 2020.
Proyecto Touro
The Group has an initial 10% stake in Cobre San Rafael, S.L., the owner of
Proyecto Touro, as part of an earn-in agreement which will enable the Group to
acquire up to 80% of the copper project. Proyecto Touro is located in Galicia,
north-west Spain. Proyecto Touro is currently in the permitting process.
In November 2019, Atalaya executed the option to acquire 12.5% of
Explotaciones Gallegas del Cobre, S.L. the exploration property around Touro,
with known additional mineralisation, which will add to the potential of
Proyecto Touro.
Proyecto Masa Valverde
On 21 October 2020, the Company announced that it had entered into a
definitive purchase agreement to acquire 100% of the shares of Cambridge
Mineria España, S.L. (since renamed Atalaya Masa Valverde, S.L.U.), a Spanish
company which fully owns the Masa Valverde polymetallic project located in
Huelva (Spain). Proyecto Masa Valverde is currently in the permitting process.
Proyecto Riotinto Este
In December 2020, Atalaya entered into a Memorandum of Understanding with a
local private Spanish company to acquire a 100% beneficial interest in three
investigation permits (known as Peñas Blancas, Cerro Negro and Herreros
investigation permits), which cover approximately 12,368 hectares and are
located immediately east of Proyecto Riotinto.
2. Overview of Operational Results
Proyecto Riotinto
The following table presents a summarised statement of operations of Proyecto
Riotinto for the three and nine months ended 30 September 2021 and 2020,
respectively.
Three months ended Three months ended Nine months ended Nine months
Units expressed in accordance with the international system of units (SI) 30 Sep 2021 30 Sep 2020 30 Sep 2021 ended
Unit 30 Sep 2020
Ore mined t 3,420,922 3,836,108 10,041,248 10,097,800
Ore processed t 3,944,934 3,974,821 11,976,051 10,974,063
Copper ore grade % 0.40 0.44 0.41 0.45
Copper concentrate grade % 21.62 22.20 20.50 22.22
Copper recovery rate % 87.24 83.78 85.63 84.13
Copper concentrate t 64,262 66,091 206,018 187,032
Copper contained in concentrate t 13,893 14,695 42,225 41,559
Payable copper contained in concentrate t 13,251 14,034 40,165 39,688
Cash cost* US$/lb payable 2.19 1.94 2.16 1.93
All-in sustaining cost* US$/lb payable 2.48 2.20 2.49 2.17
(*) Refer to Section 5 of this Management's Review
Note: The numbers in the above table may slightly differ among them due to
rounding.
Three months operational review
During Q3 2021 a total of 3.49 million tonnes of ore were processed with an
average copper head grade of 0.40% and a recovery rate of 87.24%. In
comparison with the same quarter of 2020, throughput is in line while recovery
increased 4.1%. The decrease in copper production during Q3 2021 is mainly
attributable to two stoppage for maintenance and lower ore grade partly offset
by higher recoveries. Compared with Q2 2021, copper production decreased 2.8%
as a result of 2% lower throughput and lower ore grade.
On-site concentrate inventories at the end of the quarter were approximately
4,232 tonnes, lower than Q2 2021. All concentrate in stock at the beginning of
the quarter and produced during the period was delivered to the port at
Huelva.
The average realised price per pound of copper payable for the period,
including the QPs closed in the period, was $4.31/lb compared with $4.27/lb in
Q2 2021. The average copper spot price during the quarter was $4.25/lb. The
realised price during the quarter excluding QPs was approximately $4.24/lb
compared to $4.40/lb in Q2 2021.
Nine months operating review
Production of copper contained in concentrate during YTD 2021 was 42,225
tonnes, compared with 41,559 tonnes in the same period of 2020. Payable copper
in concentrates was 39,688 tonnes compared with 40,165 tonnes of payable
copper in YTD 2020.
Ore mined in YTD 2021 was 10,041,248 tonnes compared to 10,097,800 tonnes
during YTD 2020. Ore processed was 11,976,051 tonnes versus 10,974,063 tonnes
in YTD 2020.
Ore grade during YTD 2021 was 0.41% Cu compared with 0.45% Cu in YTD 2020.
Copper recovery was 85.63% versus 84.13% in YTD 2020. Concentrate production
amounted to 206,018 tonnes above YTD 2020 of 187,032 tonnes as increased
throughput partially offset by slightly lower grade and higher recoveries.
The average realised price per pound of copper payable during the nine months,
including the QPs closed in the period, was $4.08/lb compared with $2.60/lb in
YTD 2020. The average copper spot price during the nine month ended 30
September 2021 was $4.17/lb. The realised price during YTD 2021 excluding QPs
was approximately $4.17/lb compared to $2.64/lb in YTD 2020.
3. Outlook
The forward-looking information contained in this section is subject to the
risk factors and assumptions contained in the cautionary statement on
forward-looking statements included in the introduction note of this report..
The Company is aware that the COVID-19 pandemic may still have further effects
of impact on how the Company can manage its operations and is accordingly
keeping its guidance under regular review. Should the Company consider the
current guidance no longer achievable, then the Company will provide a further
update.
Operational guidance
As a result of the strong performance at Proyecto Riotinto year-to-date, the
Company increased its 2021 copper production guidance to 54,000 - 56,000
tonnes, as previously announced on 13 October 2021.
Guidance
Unit 2021
Ore processed million tonnes 15.5 - 16.0
Contained copper tonnes 54,000 - 56,000
Copper head grade for 2021 is budgeted to average 0.42% copper, with a
recovery rate between 84 - 86%.
Cash costs for 2021 are now expected to be in the range of US$2.15/lb -
US$2.25/lb. AISC for 2021 is now expected to be at the low end of the previous
guidance range of US$2.50/lb - US$2.65 /lb copper payable. In addition, the
Company expects to spend approximately €17 million in 2021 as part of the
project to increase the capacity of the tailings dam. AISC are reported net of
the one-off project to increase the capacity of the tailings dam, with
year-to-date expenditures totaling €9.5 million.
4. Overview of the Financial Results
The following table presents summarised unaudited consolidated income
statements for the three and nine months ended 30 September 2021, with
comparatives for the three and nine months ended 30 September 2020,
respectively.
Three months ended Three months ended Nine months ended Nine months ended
30 Sep 2021 30 Sep 2020 30 Sep 2021 30 Sep 2020
(Euro 000's)
Revenue 107,161 65,836 304,265 183,569
Costs of sales (55,358) (41,813) (149,137) (134,024)
Administrative and other expenses (2,287) (1,361) (5,312) (3,519)
Exploration expenses (423) (380) (822) (1,484)
Care and maintenance expenditure (281) (29) (783) (189)
Other income (13) 12 - 20
EBITDA 48,799 22,265 148,211 44,373
Depreciation/amortisation (7,808) (8,419) (23,634) (22,186)
Impairment loss on other receivables - - - (45)
Net foreign exchange gain/(loss) 2,936 (1,411) 4,967 (2,027)
Net finance cost (456) 82 (786) (67)
Tax (5,265) (280) (24,559) (1,845)
Profit for the period 38,206 12,237 104,199 18,203
Three months financial review
Revenues for the three month period ended 30 September 2021 amounted to
€107.2 million (Q3 2020: €65.8 million). Higher revenues, compared with
the same quarter in the previous year, were mainly driven by higher copper
prices plus higher volumes sold during the period partially offset to an
extent by weaker average US Dollar rates against the Euro.
Realised prices were $4.31/lb copper during Q3 2021 compared with $2.72/lb
copper in Q3 2020. The realised price during the quarter, excluding QPs, was
approximately $4.24/lb. Concentrates during the quarter were sold under
existing offtake agreements and spot sales.
Cost of sales for the three month period ended 30 September 2021 amounted to
€55.4 million, compared with €41.8 million in Q3 2020. In absolute terms,
higher operating costs were mainly due to larger tonnes of waste extracted at
greater unit costs.
Cash costs of $2.19/lb payable copper during Q3 2021 compared with $1.94lb
payable copper in the same period last year. Higher cash costs in 2021 mainly
attributable to the increase of mining costs during the period resulted from
larger volumes of waste extracted plus higher freight rates. Capitalised
stripping costs during Q3 2021 amounted to €2.5 million compared with €2.0
million in Q3 2020. AISC excluding one-off investments in the tailings dam
previously reported as sustaining capex for Q3 2021 were $2.48/lb payable
copper compared with $2.20/lb payable copper in Q3 2020.
Sustaining capex for Q3 2021 amounted to €1.1 million compared with €0.9
million in Q3 2020. Sustaining capex mainly related to continuous enhancements
in the processing systems of the plant. In addition, the Company invested
€2.8 million in the project to increase the tailings dam during Q3 2021 (Q3
2020: €2.5 million).
Administrative and other expenses amounted to €2.3 million (Q3 2020: €1.4
million) and include non-operating costs of the Cyprus office, corporate legal
and consultancy costs, on-going listing costs, officers and directors'
emoluments, and salaries and related costs of the corporate office.
Three months financial review (cont.)
Exploration costs on Atalaya's projects portfolio for the three-month period
ended 30 September 2021 amounted to €0.4 million (Q3 2020: €0.4 million).
EBITDA for the three months ended 30 September 2021 amounted to €48.8
million compared with Q3 2020 of €22.3 million.
The main item below the EBITDA line is depreciation and amortisation of €7.8
million (Q3 2020: €8.4 million) which decreased as a result of the increase
of the reserves and resources as announced by the Company in July 2021. Net
finance expense for Q3 2021 amounted to €0.5 million (Q3 2020: income for
€0.1 million). The Group calculates the period income tax expense using the
tax rate that would be applicable to the expected total annual earnings.
Nine months financial review
Revenues for the nine month period ended 30 September 2021 amounted to
€304.3 million (YTD 2020: €183.6 million).
Copper concentrate production during the nine month period ended 30 September
2021 was 206,018 tonnes (YTD 2020: 187,032 tonnes) with 213,966 tonnes of
copper concentrates sold in the period (YTD 2020: 192,830 tonnes). Inventories
of concentrates as at the reporting date were 4,232 tonnes (31 Dec 2020: 3,845
tonnes).
Realised copper prices for YTD 2021 including and excluding QPs were $4.08/lb
and $4.17/lb copper compared with $2.60/lb and $2.64/lb copper in the same
period of 2020. Concentrates were sold under offtake agreements in place. The
Company did not enter into any hedging agreements in 2021.
Costs of sales for the nine month period ended 30 September 2021 amounted to
€149.1 million, compared with €134.0 million in YTD 2020. Higher costs in
2021 were mainly attributable to the increase in production volumes plus
greater tonnes of waste extracted resulting in higher unit costs.
Cash costs of $2.16/lb payable copper during YTD 2021 compare with $1.93/lb
payable copper in the same period last year. Higher cash costs in YTD 2021
mainly attributable to the increase of mining costs during the period resulted
from larger volumes of waste extracted plus higher freight rates. All-in
sustaining costs in the reporting period were $2.49/lb payable copper compared
with $2.17/lb payable copper in YTD 2020. Higher AISC mainly related to higher
underlying cash costs as well as additional investments in sustaining capex
and higher stripping costs.
Sustaining capex for the nine-month period ended 30 September 2021 amounted to
€4.5 million, compared with €3.8 million in the same period the previous
year. Sustaining capex related to enhancements in processing systems of the
plant. In addition, the Company invested €9.5 million in the project to
increase the tailings dam, compared with €7.5 million in 2020. Stripping
costs capitalised during 2021 amounted to €8.3 million (2020: €5.2
million).
Corporate costs for the first nine month period ended of 2021 were €5.3
million, compared with €3.5 million in YTD 2020. Corporate costs mainly
include Company's overhead expenses.
Exploration costs related to Proyecto Riotinto for the nine month period ended
30 September 2021 amounted to €0.8 million, compared with €1.5 million in
YTD 2020.
EBITDA for the nine months ended 30 September 2021 amounted to €148.2
million, compared with €44.4 million in YTD 2020.
Depreciation and amortisation amounted to €23.6 million for the nine-month
period ended 30 September 2021 (YTD 2020: €22.2 million) as a result of the
higher throughput resulting from the 2020 plant expansion.
Net finance costs for YTD 2021 amounted to €0.8 million (YTD 2020 €0.1
million loss).
On 27 October 2021 the Board declared an interim inaugural dividend of
US$0.395 per share.
4. Overview of the Financial Results (cont.)
Copper prices
The average realised copper price increased by 59.2% from US$2.72 per pound in
Q3 2020 to US$4.31 per pound in Q3 2021.
The average prices of copper for the three months ended 30 September 2021 and
2020 are summarised below:
Three months ended Three months ended Nine months ended Nine months ended
30 Sep 2021 30 Sep 2020 30 Sep 2021 30 Sep 2020
(USD)
Realised copper price per lb 4.31 2.72 4.08 2.60
Realised copper price per lb excluding QPs 4.24 3.05 4.17 2.64
Market copper price per lb (period average) 4.25 2.96 4.17 2.65
Realised copper prices for the reporting period noted above have been
calculated using payable copper and including provisional invoices and final
settlements of quotation periods ("QPs") together. Higher realised prices than
market averages are mainly due to the final settlement of invoices where QP
was fixed in the previous quarter due to a short open period when copper
prices were higher. Atalaya's average realised price increased to US$4.31/lb
from US$4.27/lb in the previous quarter. When excluding the QPs, the realised
price during Q3 2021 was US$4.24/lb. On a year-to-date basis, the realised
price has been US$4.08/lb and US$4.17/lb including and excluding QPs,
respectively.
5. Non-GAAP Measures
Atalaya has included certain non-IFRS measures including "EBITDA", "Cash Cost
per pound of payable copper", "All-In Sustaining Costs" ("AISC") and "realised
prices" in this report. Non-IFRS measures do not have any standardised meaning
prescribed under IFRS, and therefore they may not be comparable to similar
measures presented by other companies. These measures are intended to provide
additional information and should not be considered in isolation or as a
substitute for indicators prepared in accordance with IFRS.
EBITDA includes gross sales net of penalties and discounts and all operating
costs, excluding finance, tax, impairment, depreciation and amortisation
expenses.
Cash Cost per pound of payable copper includes cash operating costs, including
treatment and refining charges ("TC/RC"), freight and distribution costs net
of by-product credits. Cash Cost per pound of payable copper is consistent
with the widely accepted industry standard established by Wood Mackenzie and
is also known as the C1 cash cost.
AISC per pound of payable copper includes C1 Cash Costs plus royalties and
agency fees, expenditures on rehabilitation, capitalised stripping costs,
exploration and geology costs, corporate costs and recurring sustaining
capital expenditures but excludes one-off sustaining capital projects, such as
the tailings dam project.
Realised price per pound of payable copper is the value of the copper payable
included in the concentrate produced including the discounts and other
features governed by the offtake agreements of the Group and all discounts or
premiums provided in commodity hedge agreements with financial institutions if
any, expressed in USD per pound of payable copper. Realised price is
consistent with the widely accepted industry standard definition.
Cash cost methodology
During the last quarter of 2020, AISC was recalculated to exclude the one-off
investments in the tailings dam project. Further details including the
impact on earlier quarters are given in the 2020 audited consolidated
financial statements.
6. Liquidity and Capital Resources
Atalaya monitors factors that could impact its liquidity as part of Atalaya's
overall capital management strategy. Factors that are monitored include, but
are not limited to, the market price of copper, foreign currency rates,
production levels, operating costs, capital and administrative costs.
The following is a summary of Atalaya's cash position and cash flows as at 30
September 2021 and 31 December 2020.
Liquidity information
(Euro 000's) 30 September 2021 31 December 2020
Unrestricted cash and cash equivalents at Group level 78,333 24,519
Unrestricted cash and cash equivalents at Operation level 47,101 13,248
Restricted cash and cash equivalents at Operation level 15,420 -
Consolidated cash and cash equivalents 140,854 37,767
Net cash / (debt) position ((1)) 88,854 (15,233)
Working capital surplus / (deficit) 126,891 (17,904)
((1) )Includes bank borrowings and Deferred Consideration at 31
December 2020.
Unrestricted cash and cash equivalents as at 30 September 2021 increased to
€126.9 million from €37.8 million at 31 December 2020. The increase in
cash balances is as result of the raise in operation activities. Cash balances
are unrestricted and include balances at operational and corporate level.
Restricted cash of €15.4 million is related to the amount that the Company
transferred to a trust account (the "Trust Account") representing the full
amount of interest claimed by Astor to 30 June 2022, as detailed in the note
on Deferred Consideration.
As of 30 September 2021, Atalaya reported a working capital surplus of
€126.9 million, compared with a working capital deficit of €17.9 million
at 31 December 2020. The main liability of the working capital is trade
payables related to Proyecto Riotinto contractors to a lesser extent,
short-term loans following the drawdown of credit facilities during Q1 2021.
The increase in working capital resulted from higher cash balances as well as
payment of the Deferred Consideration, which was included in current
liabilities at the end of 2020, by utilising long-term credit facilities. At
30 September 2021, trade payables have been decreased by circa 23% compared
with the same period last year.
Overview of the Group's cash flows
Three months ended Three months ended Nine months ended Nine months ended
30 Sep 2021 30 Sep 2020 30 Sep 2021 30 Sep 2020
(Euro 000's)
Cash flows from operating activities 58,213 18,820 129,212 41,820
Cash flows used in investing activities (6,982) (6,338) (77,835) (19,669)
Cash flows used in financing activities (3,131) (15,085) 51,710 (454)
Net increase/(decrease) in cash and cash equivalents 48,100 (2,603) 103,087 21,697
Three months cash flows review
Cash and cash equivalents increased by €48.1 million during the three months
ended 30 September 2021. This was due to the net results of cash from
operating activities amounting to €58.2 million, the cash used in investing
activities amounting to €7.0 million and the cash used in financing
activities totalling €3.1 million.
Cash generated from operating activities before working capital changes was
€52.0 million. Trade receivables decreased in the period by €6.6 million,
inventory levels decreased by €5.9 million and trade payables decreased by
€4.3 million.
Investing activities during the quarter consumed €7.0 million, relating
mainly to the tailing dams Capex and sustaining Capex mostly in enhancements
in processing systems of the plant.
Financing activities during the quarter decreased by €3.1 million as result
of the full repayment of the existing unsecured credit facilities drawdown
during previous quarters.
Nine months cash flows review
Cash and cash equivalents increased by €103.1 million during the nine months
ended 30 September 2021. This was due to cash from operating activities
amounting to €129.2 million, cash used in investing activities amounting to
€77.8 million and cash used in financing activities amounting to €51.7
million.
Cash generated from operating activities before working capital changes was
€156.1 million. Trade receivable balances increased by €4.1 million,
inventories levels decreased by €2.3 million and trade payables decreased in
the period by €15.9 million.
Investing activities during the nine month period amounted to €77.8 million,
relating mainly to the early payment of the Deferred Consideration to Astor
and the tailings dam project and continuous enhancements to the processing
systems of the plant.
Financing activities during the nine month period ended 30 September 2021
reduced by €51.7 million driven by the use of existing unsecured credit
facilities to pay the Deferred Consideration. The payment was financed by
unsecured credit lines by four major Spanish banks having a three-year tenure
and an average annual interest rate of approximately two per cent.
Foreign exchange
Foreign exchange rate movements can have a significant effect on Atalaya's
operations, financial position and results. Atalaya's sales are denominated in
U.S. dollars ("USD"), while Atalaya's operating expenses, income taxes and
other expenses are mainly denominated in Euros ("EUR") which is the functional
currency of the Group, and to a much lesser extent in British Pounds ("GBP").
Accordingly, fluctuations in the exchange rates can potentially impact the
results of operations and carrying value of assets and liabilities on the
balance sheet.
During the three and nine month period ended 30 September 2021, Atalaya
recognised a foreign exchange gain of €3.0 million and €5.0 million,
respectively. Foreign exchange gains mainly related to changes in the period
in EUR and USD conversion rates, as all sales are cashed and occasionally held
in USD.
6. Liquidity and Capital Resources (cont.)
The following table summarises the movement in key currencies versus the EUR:
Three months ended Three months ended Nine months ended Nine months ended
30 Sep 2021 30 Sep 2020 30 Sep 2021 30 Sep 2020
Average rates for the periods
GBP - EUR 0.8553 0.9050 0.8636 0.8851
USD - EUR 1.1788 1.1689 1.1962 1.1250
Spot rates as at
GBP - EUR 0.8605 0.9124 0.8605 0.9124
USD - EUR 1.1579 1.1708 1.1579 1.1708
7. Deferred Consideration
In September 2008, the Group moved to 100% ownership of Atalaya Riotinto
Mineral S.L. ("ARM") (and thus full ownership of Proyecto Riotinto) by
acquiring the remaining 49% of the issued capital of ARM. At the time of the
acquisition, the Group signed a Master Agreement (the "Master Agreement") with
Astor Management AG ("Astor") which included a deferred consideration of
€43.9 million (the "Deferred Consideration") payable as consideration in
respect of the acquisition among other items. The Company also entered into a
credit assignment agreement at the same time with a related company of Astor,
Shorthorn AG, pursuant to which the benefit of outstanding loans was assigned
to the Company in consideration for the payment of €9.1 million to Shorthorn
(the "Loan Assignment").
The Master Agreement has been the subject of litigation in the High Court and
the Court of Appeal that has now concluded. As a consequence, ARM must apply
any excess cash (after payment of operating expenses, sustaining capital
expenditure, any senior debt service requirements and up to US$10 million per
annum (for non-Proyecto Riotinto related expenses)) to pay the consideration
due to Astor (including the Deferred Consideration and the amount of €9.1
million payable under the Loan Assignment). "Excess cash" is not defined in
the Master Agreement leaving ambiguity as to how it is to be calculated.
On 2 March 2020, the Company filed an application in the High Court to seek
clarity on the definition of "Excess Cash". The Company and Astor have now
exchanged statements of case to set out their formal position. The trial is
listed to be heard from 21 February 2022 (the "Trial"). Following the filing
of the statements of case for the Trial, Astor applied to Court seeking an
early determination (without the need for a full trial) of the dispute in
relation to the "Excess Cash" (the "Summary Judgment application"). The
Summary Judgment application was heard on 14-15 June 2021. The Court dismissed
Astor's application and the question as to whether any residual interest is
payable to Astor therefore remains to be resolved at Trial.
As previously announced, during December 2020 the Board had discussions and
considered an early payment of the Deferred Consideration and the Loan
Assignment provided certain conditions could be met. Conditions included among
others the execution of credit facilities agreements to fund the payment.
In March 2021, the Company fulfilled all conditions required by the Board of
Directors and made the early payment of €53 million to Astor. The payment
was fully funded by unsecured credit facilities entered into between December
2020 and February 2021 at interest rates ranging from 1.60% to 2.45% and
repayable by 2023 and 2024.
The payment of the Deferred Consideration does not end the ongoing litigation
as the issue as to whether any residual interest may or may not be payable
remains unresolved. Consequently, on 15 July 2021, the Company transferred
€15.4 million to a trust account (the "Trust Account") representing the full
amount of interest claimed by Astor to 30 June 2022. The holder of the Trust
Account has provided an undertaking to hold the full amount until settlement
of the claim to interest or judgment following the Trial. The Company
understands the monies held in the Trust Account safeguard the maximum
outstanding liability to Astor in relation to the Master Agreement. On that
basis, and because the Consideration has been paid in full in accordance with
the Master Agreement, Atalaya treats itself as free of the obligations set out
in the Master Agreement.
The Company is currently working on other court directions in preparation for
the Trial and continues to be confident in its case and is of the view that no
residual interest will be payable to Astor.
Corporate Social Responsibility
Atalaya's wholly-owned Fundación Atalaya Riotinto has continued its efforts
to develop initiatives to comply with its social responsibility during the
third quarter of the year.
In this regard, the Company has started the proceedings to initiate the second
edition of its training program for unemployed people from local communities,
which is also supported by Riotinto Mine main contractors. The precedent
program concluded satisfactorily with around half the participants now working
in different companies.
During the quarter, the Company has finalised the conversations with the
neighbouring municipalities, and a new cooperation agreement has been signed
that include all the municipalities. The new agreement will provide with funds
to undertake cooperation initiatives addressing infrastructure, social and
environmental projects. Atalaya has also closed several agreements with the
municipality of Minas de Riotinto to start with various initiatives which
include works to refurbish the local school, improvements in the sporting
municipal facilities, cleaning campaign for La Dehesa district and
installation of new signs and CCTV to improve the security in the town. Corta
Atalaya historical pit access and look-out have been refurbished and are now
successfully established as a new tourist attraction which is contributing to
the local economy. In Nerva town, Atalaya has agreed to fund a program to
train recently graduated scholars, who will work at the municipality to
improve their skills. Atalaya has also cooperated with various local
organisations, including a retired miners association, the NGO: "Unidos por el
Alto", which work with troubled kids, and several sporting clubs which have
received sponsorship.
8. Health and Safety
During the quarter, in relation to prevention actions against Covid, the
SAR-CoV2 control tests have continued to be carried out in the infirmary:
antigens, antibodies and PCR, as well as the other measures implemented to
prevent the spread of the virus. It should also be noted that Atalaya joined
the Junta de Andalucía's Sumamos Plan to facilitate vaccination to anyone
(employee or contractor) interested and within the age range authorised by the
regional administration. Up to September 2021, 134. employees have been
vaccinated in the facilities, 48% Atalaya employees and 52% from contracting
companies.
On the other hand, in this quarter the control of drugs continues the
prevention work under the influence of psychoactive substances. Since July
2021 these tests are mandatory when workers start and finish the workday, as
well as when an accident happen.
The training plan of Atalaya employees is focused on respiratory protection
against dust and breathable crystalline silica, as well as 10 training
sessions this quarter for the first assistance Brigade of Atalaya.
It should be noted that the internal audit of the ISO 45001: 2018 occupational
health and safety management system has been carried out, which is part of the
company's Integrated Management System.
9. Environmental Management
During Q3 2021, the environmental department has continued to carry out
environmental monitoring and environmental management activities, as well as
environmental compliance inspection activities. Key points of the quarter:
- The additional measures included in the action plan against dust
continued to be implemented, intensifying periodic risks, implementing new
coordination measures and carrying out exhaustive monitoring of the emissions
generated in the operation
- A project was started, in cooperation with the University of
Huelva, to develop a passive treatment for mine drainage. The aim of this
project is to improve the quality of the water around Proyecto Riotinto. The
project will be developed over the next 9 months.
10. Risk Factors
Due to the nature of Atalaya's business in the mining industry, the Group is
subject to various risks that could materially impact the future operating
results and could cause actual events to differ materially from those
described in forward-looking statements relating to Atalaya. Readers are
encouraged to read and consider the risk factors detailed in Atalaya's
audited, consolidated financial statements for the year ended 31 December
2020.
The Company continues to monitor the principal risks and uncertainties that
could materially impact the Company's results and operations, including the
areas of increasing uncertainty such as COVID-19 (refer to point 13 below).
11. Critical accounting policies, estimates, judgements, assumptions and
accounting changes
The preparation of Atalaya's Financial Statements in accordance with IFRS
requires management to make estimates, judgements and assumptions that affect
amounts reported in the Financial Statements and accompanying notes. There is
a full discussion and description of Atalaya's critical accounting policies in
the audited consolidated financial statements for the year ended 31 December
2020.
As at 30 September 2021, there are no significant changes in critical
accounting policies or estimates to those applied in 2020.
12. COVID-19 impact
It is Atalaya's priority to protect its workforce and the local communities
surrounding Proyecto Riotinto, Proyecto Masa Valverde and Proyecto Touro.
Atalaya is following the requirements and recommendations issued by the
Government of Spain and the regional and local health authorities to reduce
the risk of COVID-19 exposure and avoid the spread of the virus.
13. Other Information
Additional information about Atalaya Mining Plc. is available at www.sedar.com
and at www.atalayamining.com (http://www.atalayamining.com)
Unaudited Interim Condensed Consolidated Financial Statements on pages 13 to
38.
By Order of the Board of Directors,
___________________________________
Roger Davey
Chairman
Nicosia, 17 November 2021
Unaudited Interim Condensed Consolidated Income Statements
(All amounts in Euro thousands unless otherwise stated)
For the period ended 30 September 2021 and 2020
Three months ended Three months ended Nine months ended Nine
30 Sep 2021 30 Sep 2020 30 Sep 2021 months ended
30 Sep 2020
(Euro 000's) Note
Revenue 4 107,161 65,836 304,265 183,569
Operating costs and mine site administrative expenses (55,063) (41,565) (148,533) (133,455)
Mine site depreciation and amortization (7,808) (8,419) (23,634) (22,186)
Gross profit 44,290 15,852 132,098 27,928
Administration and other expenses (2,287) (1,361) (5,312) (3,519)
Share-based benefits 13 (295) (248) (604) (569)
Impairment loss on other receivables - - - (45)
Exploration expenses (423) (380) (822) (1,484)
Care and maintenance expenditure (281) (29) (783) (189)
Operating profit 41,004 13,834 124,577 22,122
Other income (13) 12 - 20
Net foreign exchange gain/(loss) 2,936 (1,411) 4,967 (2,027)
Net finance costs 5 (456) 82 (786) (67)
Profit before tax 43,471 12,517 128,758 20,048
Tax (5,265) (280) (24,559) (1,845)
Profit for the period 38,206 12,237 104,199 18,203
Profit for the period attributable to:
- Owners of the parent 38,422 12,402 104,863 18,794
- Non-controlling interests (216) (165) (664) (591)
38,206 12,237 104,199 18,203
Earnings per share from operations attributable to equity holders of the
parent during the period:
Basic earnings per share (EUR cents per share) 6 27.5 9.0 75.9 13.7
Fully diluted earnings per share (EUR cents per share) 6 26.7 8.8 74.2 13.4
Profit for the period 38,206 12,237 104,199 18,203
Other comprehensive income:
Change in fair value of financial assets through other comprehensive income (36) 61 (34) 52
'OCI'
Total comprehensive income for the period 38,170 12,298 104,165 18,255
Total comprehensive income for the period attributable to:
- Owners of the parent 38,386 12,463 104,829 18,846
- Non-controlling interests (216) (165) (664) (591)
38,170 12,298 104,165 18,255
The notes on pages 17 to 38 are an integral part of these Unaudited Interim
Condensed Consolidated Financial Statements.
Unaudited Interim Condensed Consolidated Statement of Financial Position
(All amounts in Euro thousands unless otherwise stated)
As at 30 September 2021 and 2020
(Euro 000's) Note 30 Sep 2021 31 Dec 2020
Assets Unaudited Audited
Non-current assets
Property, plant and equipment 8 332,630 327,174
Intangible assets 9 56,598 59,816
Trade and other receivables 11 5,321 2,715
Non-current financial assets 1,101 1,101
Deferred tax asset 9,311 8,805
404,961 399,611
Current assets
Inventories 10 21,265 23,576
Trade and other receivables 11 45,391 43,191
Tax refundable 98 815
Other financial assets 52 86
Cash and cash equivalents 12 140,854 37,767
207,660 105,435
Total assets 612,621 505,046
Equity and liabilities
Equity attributable to owners of the parent
Share capital 13 13,445 13,439
Share premium 13 315,865 315,714
Other reserves 14 52,409 40,049
Accumulated profits/(losses) 77,283 (15,512)
459,002 353,690
Non-controlling interests (4,155) (3,491)
Total equity 454,847 350,199
Liabilities
Non-current liabilities
Trade and other payables 15 1,463 1,448
Provisions 16 28,237 25,264
Leases liabilities 18 5,063 4,796
Borrowings 17 42,242 -
77,005 31,508
Current liabilities
Trade and other payables 15 52,551 68,437
Leases liabilities 18 600 592
Borrowings 17 9,758 -
Deferred consideration - 53,000
Current tax liabilities 17,860 1,310
80,769 123,339
Total liabilities 157,774 154,847
Total equity and liabilities 612,621 505,046
The notes on pages 17 to 38 are an integral part of these Unaudited Interim
Condensed Consolidated Financial Statements. The unaudited interim condensed
consolidated financial statements were authorised for issue by the Board of
Directors on 17 November 2021 and were signed on its behalf.
Roger Davey Alberto Lavandeira
Chairman Managing Director
Unaudited Interim Condensed Consolidated Statements of Changes in Equity
(All amounts in Euro thousands unless otherwise stated)
For the period ended 30 September 2021 and 2020
Other reserves Accum. Non-controlling interest
Note Share capital Share premium((1)) profits Total Total equity
(Euro 000's)
At 1 January 2021 13,439 315,714 40,049 (15,512) 353,690 (3,491) 350,199
Profit for the period - - 104,863 104,863 (664) 104,119
Change in fair value of financial assets through OCI
- - (34) - (34) - (34)
Total comprehensive income - - (34) 104,863 104,829 (664) 104,165
Transactions with owners
Issuance of share capital 6 151 - 157 - 157
Recognition of share-based payments 13 - - 605 - 605 - 605
Recognition of depletion factor 13 - - 6,100 (6,100) - - -
Recognition of non-distributable reserve 13 - - 2,372 (2,372) - - -
Recognition of distributable reserve - - 3,317 (3,317)
Other changes in equity - - - (279) (279) - (279)
At 30 September 2021 13,445 315,865 52,409 77,283 459,002 (4,155) 454,847
( )
((1)) The share premium reserve is not available for distribution
Other reserves Accum. Non-controlling interest
Note Share capital Share premium((1)) losses Total Total equity
(Euro 000's)
At 1 January 2020 13,372 314,319 22,836 (30,669) 319,858 (2,402) 317,456
Profit for the period - - 18,794 18,795 (591) 18,204
Change in fair value of financial assets through OCI
- - 52 - - - 52
Total comprehensive income - - 52 18,794 18,846 (591) 18,255
Transactions with owners
Recognition of share-based payments - - 569 - 569 - 569
Recognition of depletion factor 13 - - 8,000 (8,000) - - -
Recognition of non-distributable reserve 13 - - 2,198 (2,198) - - -
Other changes in equity 13 - - - 27 27 - 27
At 30 September 2020 13,372 314,319 33,655 (22,046) 339,300 (2,993) 336,307
((1)) The share premium reserve is not available for distribution
Other reserves Accum. Non-controlling interest
Note Share capital Share premium((1)) losses Total Total equity
(Euro 000's)
Audited
At 1 January 2020 13,372 314,319 22,836 (30,669) 319,858 (2,402) 317,456
Profit for the period - - - 31,479 31,479 (1,089) 30,390
Change in fair value of financial assets through OCI
- - 44 - 44 - 44
Total comprehensive income - - 44 31,479 31,523 (1,089) 30,434
Transactions with owners
Recognition of depletion factor 13 67 1,395 1,462 1,462
Recognition of share-based payments 13 14,155 (14,155) - - -
Recognition of non-distributable reserve 13 - - 816 816 - 816
Recognition of distributable reserve 13 - - 2,198 (2,198) - - -
Other changes in equity - - - 31 31 - 31
At 31 December 2020 13,439 315,714 40,049 (15,512) 353,690 (3,491) 350,199
( (1)) The share premium reserve is not available for distribution
The notes on pages 17 to 38 are an integral part of these Unaudited Interim
Condensed Consolidated Financial Statements.
Unaudited Interim Condensed Consolidated Statement of Cash Flows
(All amounts in Euro thousands unless otherwise stated)
For to the period ended 30 September 2021 and 2020
Three months ended Three months ended Nine months ended Nine
Sep 30 Sep 30 Sep months ended
2021 2020 2021 30 Sep
(Euro 000's) Note 2020
Cash flows from operating activities
Profit before tax 43,471 12,517 128,758 20,048
Adjustments for:
Depreciation of property, plant and equipment 8 6,662 7,096 20,155 18,530
Amortisation of intangibles 9 1,146 1,323 3,479 3,656
Recognition of share-based payments 13 295 248 604 569
Interest income 5 (15) (112) (20) (116)
Interest expense 5 385 56 632 109
Unwinding of discounting on mine rehabilitation provision 5 84 (30) 167 62
Other provisions 16 - - 2,617 --
Legal provisions 16 - 267 (278) 300
Impairment loss on other receivables 8 - - - 45
Unrealised foreign exchange loss on financing activities (48) (90) (37) (19)
Cash inflows from operating activities before working capital changes 51,980 21,275 156,077 43,184
Changes in working capital:
Inventories 10 5,880 (4,052) 2,311 1,709
Trade and other receivables 11 6,599 7,700 (4,089) (3,427)
Trade and other payables 15 (4,304) (3,863) (15,886) 3,934
Cash flows from operations 60,155 21,060 138,413 45,400
Interest on lease liabilities (3) (4) (8) (12)
Interest paid (385) (56) (632) (109)
Tax paid (1,554) (2,180) (8,561) (3,459)
Net cash from operating activities 58,213 18,820 129,212 41,820
Cash flows from investing activities
Purchase of property, plant and equipment 8 (6,906) (6,450) (24,594) (19,875)
Purchase of intangible assets 9 (91) - (261) -
Payment of deferred consideration - - (53,000) -
Interest received 5 15 112 20 116
Net cash used in investing activities (6,982) (6,338) (77,835) (19,669)
Cash flows from financing activities
Lease payments 18 (154) (151) (463) (454)
Net (repayment)/proceeds from borrowings (2,977) (14,934) 52,015 -
Proceeds from issuance of shares - 158
Net cash flows (used in)/from financing activities (3,131) (15,085) 51,710 (454)
Net increase/(decrease) in cash and cash equivalents 48,100 (2,063) 103,087 21,697
Cash and cash equivalents:
At beginning of the period 92,754 32,377 37,767 8,077
At end of the period 140,854 29,774 140,854 29,774
The notes on pages 17 to 38 are an integral part of these Unaudited Interim
Condensed Consolidated Financial Statements.
Notes to the Unaudited Interim Condensed Consolidated Financial Statements
(All amounts in Euro thousands unless otherwise stated)
For the period ended 30 September 2021 and 2020
1. Incorporation and summary of business
Atalaya Mining Plc (the "Company") was incorporated in Cyprus on 17 September
2004 as a private company with limited liability under the Companies Law, Cap.
113 and was converted to a public limited liability company on 26 January
2005. Its registered office is at 1 Lampousa Street, Nicosia, Cyprus.
The Company was listed on AIM of the London Stock Exchange in May 2005 under
the symbol ATYM and on the TSX on 20 December 2010 under the symbol AYM. The
Company continued to be listed on AIM and the TSX as at 30 September 2021.
Additional information about Atalaya Mining Plc is available at
www.atalayamining.com (http://www.atalayamining.com) as per requirement of AIM
rule 26.
Change of name and share consolidation
Following the Company's Extraordinary General Meeting ("EGM") on 13 October
2015, the change of name from EMED Mining Public Limited to Atalaya Mining Plc
became effective on 21 October 2015. On the same day, the consolidation of
ordinary shares came into effect, whereby all shareholders received one new
ordinary share of nominal value Stg £0.075 for every 30 existing ordinary
shares of nominal value Stg £0.0025.
Principal activities
Atalaya is a European mining and development company. The strategy is to
evaluate and prioritise metal production opportunities in several
jurisdictions throughout the well-known belts of base and precious metal
mineralisation in Spain and the Eastern European region.
The Group currently owns three mining projects: Proyecto Riotinto, Proyecto
Touro and Proyecto Masa Valverde. In addition, the Company has an earn-in
agreement to acquire three investigation permits at Proyecto Riotinto Este.
Proyecto Riotinto
The Company owns and operates through a wholly owned subsidiary, "Proyecto
Riotinto", an open-pit copper mine located in the Pyritic belt, in the
Andalusia region of Spain, approximately 65 km northwest of Seville. A
brownfield expansion of this mine was completed in 2019.
Proyecto Touro
The Group has an initial 10% stake in Cobre San Rafael, S.L., the owner of
Proyecto Touro, as part of an earn-in agreement which will enable the Group to
acquire up to 80% of the copper project. Proyecto Touro is located in Galicia,
north-west Spain. Proyecto Touro is currently in the permitting process.
In November 2019, Atalaya executed the option to acquire 12.5% of
Explotaciones Gallegas del Cobre, S.L. the exploration property around Touro,
with known additional reserves, which will provide high potential to the
Proyecto Touro.
Proyecto Masa Valverde
On 21 October 2020, the Company announced that it entered into a definitive
purchase agreement to acquire 100% of the shares of Cambridge Mineria España,
S.L. (since renamed Atalaya Masa Valverde, S.L.U.), a Spanish company which
fully owns the Masa Valverde polymetallic project located in Huelva (Spain).
Under the terms of the agreement Atalaya will make an aggregate €1.4 million
cash payment in two instalments of approximately the same amount. The first
payment is to be executed once the project is permitted and second and final
payment when first production is achieved from the concession. Proyecto Masa
Valverde is currently in the permitting process.
Proyecto Riotinto Este
In December 2020, Atalaya entered into a Memorandum of Understanding with a
local private Spanish company to acquire a 100% beneficial interest in three
investigation permits (known as Peñas Blancas, Cerro Negro and Herreros
investigation permits), which cover approximately 12,368 hectares and are
located immediately east of Proyecto Riotinto.
2. Basis of preparation and accounting policies
2.1 Basis of preparation
(a) Overview
The unaudited interim condensed consolidated financial statements for the
period ended 30 September 2021 have been prepared in accordance with
International Accounting Standards 34: Interim Financial Reporting. IFRS
comprise the standard issued by the International Accounting Standard Board
("IASB"), and IFRS Interpretations Committee ("IFRICs") as issued by the IASB.
Additionally, the unaudited interim condensed consolidated financial
statements have also been prepared in accordance with the IFRS as adopted by
the European Union (EU), using the historical cost convention.
These unaudited interim condensed consolidated financial statements are
include the financial statements of the Company and its subsidiary
undertakings. They have been prepared using accounting bases and policies
consistent with those used in the preparation of the consolidated financial
statements of the Company and the Group for the year ended 31 December 2020.
These unaudited interim condensed consolidated financial statements do not
include all of the disclosures required for annual financial statements, and
accordingly, should be read in conjunction with the consolidated financial
statements and other information set out in the Group's annual report for the
year ended 31 December 2020. The accounting policies are unchanged from those
disclosed in the annual consolidated financial statements for the year ended
31 December 2020.
(b) Going concern
These unaudited condensed interim consolidated financial statements have been
prepared based on accounting principles applicable to a going concern which
assumes that the Group will realise its assets and discharge its liabilities
in the normal course of business. Management has carried out an assessment of
the going concern assumption and has concluded that the Group will generate
sufficient cash and cash equivalents to continue operating for the next twelve
months.
2.2 New standards, interpretations and amendments adopted by the Group
The accounting policies adopted in the preparation of the unaudited condensed
interim consolidated financial statements are consistent with those followed
in the preparation of the Group's annual consolidated financial statements for
the year ended 31 December 2020, except for the adoption of new standards
effective as of 1 January 2021. The Group has not early adopted any standard,
interpretation or amendment that has been issued but is not yet effective.
Several amendments and interpretations apply for the first time in 2021, but
do not have a material impact on the unaudited condensed interim consolidated
financial statements of the Group.
Interest Rate Benchmark Reform - Phase 2: Amendments to IFRS 9, IAS 39, IFRS
7, IFRS 4 and IFRS 16
The amendments provide temporary reliefs which address the financial reporting
effects when an interbank offered rate (IBOR) is replaced with an alternative
nearly risk-free interest rate (RFR).
The amendments include the following practical expedients:
• A practical expedient to require contractual changes, or changes to cash
flows that are directly required by the reform, to be treated as changes to a
floating interest rate, equivalent to a movement in a market rate of interest
• Permit changes required by IBOR reform to be made to hedge designations
and hedge documentation without the hedging relationship being discontinued
• Provide temporary relief to entities from having to meet the separately
identifiable requirement when an RFR instrument is designated as a hedge of a
risk component
These amendments had no impact on the unaudited interim condensed consolidated
financial statements of the Group. The Group intends to use the practical
expedients in future periods if they become applicable.
2.3 Fair value estimation
The fair values of the Group's financial assets and liabilities approximate
their carrying amounts at the reporting date.
The fair value of financial instruments traded in active markets, such as
publicly traded trading and other financial assets is based on quoted market
prices at the reporting date. The quoted market price used for financial
assets held by the Group is the current bid price. The appropriate quoted
market price for financial liabilities is the current ask price.
The fair value of financial instruments that are not traded in an active
market is determined by using valuation techniques. The Group uses a variety
of methods, such as estimated discounted cash flows, and makes assumptions
that are based on market conditions existing at the reporting date.
Fair value measurements recognised in the consolidated statement of financial
position
The following table provides an analysis of financial instruments that are
measured subsequent to initial recognition at fair value, Grouped into Levels
1 to 3 based on the degree to which the fair value is observable.
· Level 1 fair value measurements are those derived from quoted
prices (unadjusted) in active markets for identical assets or liabilities.
· Level 2 fair value measurements are those derived from inputs
other than quoted prices included within Level 1 that are observable for the
asset or liability, either directly (i.e. as prices) or indirectly (i.e.
derived from prices).
· Level 3 fair value measurements are those derived from valuation
techniques that include inputs for the asset or liability that are not based
on observable market data (unobservable inputs).
Financial assets or liabilities
(Euro 000's) Level 1 Level 2 Level 3 Total
30 September 2021
Other financial assets
Financial assets at FV through OCI 52 - 1,101 1,153
Trade and other receivables
Receivables (subject to provisional pricing) - 22,692 - 22,692
Total 52 22,692 1,101 23,845
31 December 2020
Other financial assets
Financial assets at FV through OCI 86 - 1,101 1,187
Trade and other receivables
Receivables (subject to provisional pricing) - 24,250 - 24,250
Total 86 24,250 1,101 25,437
2.4 Critical accounting estimates and judgements
The preparation of the unaudited interim condensed consolidated financial
statements require management to make judgements, estimates and assumptions
that affect the reported amounts of revenues, expenses, assets and
liabilities, and the accompanying disclosures, and the disclosure of
contingent liabilities at the date of the consolidated financial statements.
Estimates and assumptions are continually evaluated and are based on
management's experience and other factors, including expectations of future
events that are believed to be reasonable under the circumstances. Uncertainty
about these assumptions and estimates could result in outcomes that require a
material adjustment to the carrying amount of assets or liabilities affected
in future periods.
Provisions are recognised when the Group has a present legal or constructive
obligation as a result of past events, it is probable that an outflow of
resources will be required to settle the obligation, and a reliable estimate
of the amount can be made. If the effect of the time value of money is
material, provisions are discounted using a current pre-tax rate that
reflects, where appropriate, the risks specific to the liability. Where
discounting is used, the increase in the provision due to the passage of time
is recognised as a finance cost.
A full analysis of critical accounting estimates and judgements is set out in
Note 3.3 to the 2020 audited financial statements.
3. Business and geographical segments
Business segments
The Group has only one distinct business segment, being that of mining
operations, which include mineral exploration and development.
Copper concentrates produced by the Group are sold to three off-takers as per
the relevant offtake agreements (Note 22.3)
Geographical segments
The Group's mining activities are located in Spain. The commercialisation of
the copper concentrates produced in Spain is carried out through Cyprus. Sales
transactions to related parties are on arm's length basis in a similar manner
to transaction with third parties. Accounting policies used by the Group in
different locations are the same as those contained in Note 2. In addition,
the Company sells to the Spot market concentrate produced during the period
which are in excess of the offtake agreements commitments.
(Euro 000's) Cyprus Spain Other Total
Three months ended 30 September 2021
Revenue - from external customers 7,303 99,858 - 107,161
Earnings/(loss) Before Interest, Tax, Depreciation and Amortisation (EBITDA) 4,893 43,931 (25) 48,799
Depreciation/amortisation charge - (7,808) - (7,808)
Net foreign exchange gain 1,173 1,764 - 2,937
Finance income - 15 - 15
Finance cost - (472) - (472)
Profit/(loss) before tax 6,066 37,430 (25) 43,471
Tax (511) (4,754) - (5,265)
Profit for the period 5,555 32,676 (25) 38,206
Nine months ended 30 September 2021
Revenue - from external customers 29,041 275,224 - 304,265
Earnings/(loss) Before Interest, Tax, Depreciation and Amortisation (EBITDA) 21,539 126,706 (34) 148,211
Depreciation/amortisation charge - (23,634) - (23,634)
Net foreign exchange gain/(loss) 1,568 3,398 2 (4,968)
Finance income - 20 - 20
Finance cost - (807) - (807)
Profit/(loss) before tax 23,107 105,683 (32) 128,758
Tax (2,075) (22,484) - (24,559)
Profit for the period 21,032 83,199 (32) 104,199
Total assets 100,463 511,026 1,132 612,621
Total liabilities (1,636) (156,138) - (157,774)
Depreciation of property, plant and equipment - 20,155 - 20,155
Amortisation of intangible assets - 3,479 - 3,479
Total additions of non-current assets - 35,553 - 35,553
(Euro 000's) Cyprus Spain Other Total
Three months ended 30 September 2020
Revenue - from external customers 4,312 61,524 - 65,836
Earnings/(loss) Before Interest, Tax, Depreciation and Amortisation (EBITDA) 2,132 20,175 (42) 22,265
Depreciation/amortisation charge - (8,419) - (8,419)
Net foreign exchange (loss) (425) (986) - (1,411)
Finance income - 112 - 112
Finance cost - (30) - (30)
Profit/(loss) before tax 1,707 10,852 (42) 12,517
Tax 405 (685) - (280)
Profit for the period 2,112 10,167 (42) 12,237
Nine months ended 30 September 2020
Revenue - from external customers 11,896 171,673 - 183,569
Earnings/(loss) Before Interest, Tax, Depreciation and Amortisation (EBITDA) 6,481 38,035 (143) 44,373
Depreciation/amortisation charge - (22,186) - (22,186)
Net foreign exchange gain/(loss) (481) (1,550) 4 (2,027)
Finance income (45) - - 45
Finance cost - 116 - 116
Profit/(loss) before tax (1) (182) - (183)
Tax 5,954 14,234 (139) 20,048
Profit for the period (1,022) (823) - (1,845)
4,932 13,411 (139) 18,203
Total assets
Total liabilities 33,167 431,391 1,160 465,718
Depreciation of property, plant and equipment (11,041) (118,332) (38) (129,411)
Amortisation of intangible assets - 18,530 - 18,530
Total additions of non-current assets - 3,656 - 3,656
Revenue represents the sales value of goods supplied to customers, net of
value added tax. The following table summarises sales to customers with whom
transactions have individually exceeded 10.0% of the Group's revenues.
(Euro 000's) Nine months Nine months
ended ended
30 Sep 30 Sep
2021 2020
Segment €'000 Segment €'000
Offtaker 1 Copper 92,708 Copper 30,821
Offtaker 2 Copper 67,229 Copper 56,687
Offtaker 3 Copper 135,062 Copper 96,061
4. Revenue
Three months ended Three months ended 30 Sep 2020 Nine months ended Nine months ended
30 Sep 2021 30 Sep 2021 30 Sep 2020
(Euro 000's)
Revenue from contracts with customers ((1)) 110,363 183,447 297,551 63,421
Fair value (losses)/gains relating to provisional pricing within sales ((2)) (3,202) 122 6,714 2,415
Total revenue 107,161 183,569 304,265 65,836
All revenue from copper concentrate is recognised at a point in time when the
control is transferred. Revenue from freight services is recognised over time
as the services are provided.
((1) )Included within YTD 2021 revenue, there is a transaction
price of €1.7 million (€2.3 million in YTD 2020) related to the freight
services provided by the Group to the customers arising from the sales of
copper concentrate under CIF incoterm.
((2) )Provisional pricing impact represents the change in fair
value of the embedded derivative arising on sales of concentrate.
5. Net finance cost
Three months ended 30 Sep 2021 Three months ended 30 Sep 2020 Nine months ended 30 Sep 2021 Nine months ended
30 Sep 2020
(Euro 000's)
Interest expense:
Other interest (385) (56) (632) (109)
Interest on lease liabilities (3) (4) (8) (12)
Unwinding of discount on mine rehabilitation provision (Note 16) (84) 30 (167) (62)
Interest income((1)) 15 112 20 116
(457) 82 (787) (67)
((1) )Interest income relates to interest received on bank
balances
6. Tax
The Group calculates the period income tax expense using the tax rate that
would be applicable to the expected total annual earnings. The major
components of income tax expense in the unaudited interim condensed
consolidated statement of profit or loss are:
Three months ended 30 Sep 2021 Three months ended 30 Sep 2020 Six months ended 30 Sep 2021 Six months ended
30 Sep 2020
(Euro 000's)
Income taxes
Current income tax expense (5,265) (280) (24,559) (1,845)
Income tax expense recognised in statement of profit and loss (5,265) (280) (24,559) (1,845)
7. Earnings per share
The calculation of the basic and fully diluted earnings per share attributable
to the ordinary equity holders of the Company is based on the following data:
Three months ended 30 Sep 2021 Three months ended 30 Sep 2020 Nine months ended 30 Sep 2021 Nine months ended
30 Sep 2020
(Euro 000's)
Profit attributable to equity holders of the parent 38,422 12,403 104,863 18,794
Weighted number of ordinary shares for the purposes of basic earnings per
share (000's)
139,730 137,339 138,190 137,339
Basic earnings per share (EUR cents/share) 27.5 9.0 75.9 13.7
Weighted number of ordinary shares for the purposes of fully diluted earnings
per share (000's)
143,639 140,894 141,342 140,202
Fully diluted earnings per share (EUR cents/share) 26.7 8.8 74.2 13.4
At 30 September 2021 there are nil warrants (Note 11) and 3,866,250 options
(Note 13) (30 September 2020: nil warrants and 3,555,250 options) which have
been included when calculating the weighted average number of shares for fully
diluted earnings per share for 2021.
8. Property, plant and equipment
Land and buildings Right-of-use assets Plant and machinery Assets under construction ((1)) Other assets ((3)) Total
Deferred mining costs ((2))
(Euro 000's)
Cost
At 1 January 2020 46,063 6,421 248,221 16,517 34,013 781 352,016
Additions 401 - 543 13,983 5,242 - 20,169
Reclassifications - - 9,296 (9,296) - - -
At 30 September 2020 46,464 6,421 258,060 21,204 39,255 781 372,185
Additions - 148 1,735 2,880 2,613 20 7,396
Increase in rehab. provision
17,954((4)) - - - - - 17,954
Reclassifications - - 8,256 (8,256) - - -
Advances 17 - - - - - 17
At 31 December 2020 64,034 6,569 268,051 15,828 41,868 801 397,151
Additions 510 507 1,734 14,593 8,267 - 25,611
Reclassifications - - 807 (807) - - -
At 30 September 2021 64,544 7,076 270,592 29,614 50,135 801 422,762
Depreciation
At 1 January 2020 8,257 391 28,872 - 6,061 620 44,201
Charge for the period 2,278 402 14,044 - 1,765 41 18,530
At 30 September 2020 10,535 793 42,916 - 7,826 661 62,731
Charge for the period 1,136 163 5,218 - 702 27 7,246
At 31 December 2020 11,671 956 48,134 - 8,528 688 69,977
Charge for the period 3,303 446 14,348 - 2,038 20 20,155
At 30 September 2021 14,974 1,402 62,482 - 10,566 708 90,132
Net book value - - - -
At 30 September 2021 49,570 5,674 208,110 29,614 39,569 93 332,630
At 31 December 2020 52,363 5,613 219,917 15,828 33,340 113 327,174
( )
((1) )Assets under construction at 30 September 2021 were €29.6 million (31
December 2020: €15.8 million) which include sustaining capital expenditures
and tailings dams project.
((2) )Stripping costs
((3) )Includes motor vehicles, furniture, fixtures and office equipment which
are depreciated over 5-10 years.
((4) )The increase in the depreciation relate to the completion of the
expansion project in January 2020 and the increase of ore processed.
The above fixed assets are mainly located in Spain.
9. Intangible assets
Permits ((1))
(Euro 000's) Licences, R&D and software Total
Cost
At 1 January 2020 76,538 7,610 84,148
Additions - - -
At 30 September 2020 76,538 7,610 84,148
Additions 1,672((2)) 1,312 2,984
Disposals - (327) (327)
At 31 December 2020 78,210 8,595 86,805
Additions - 261 261
At 30 September 2021 78,210 8,856 87,066
Amortisation
On 1 January 2020 13,808 7,255 21,063
Charge for the period 3,607 49 3,656
At 30 September 2020 17,415 7,304 24,719
Charge for the period 1,268 16 1,284
Impairment charge - 985 985
At 31 December 2020 18,683 8,306 26,989
Charge for the period 3,430 49 3,479
At 30 September 2021 22,113 8,355 30,468
Net book value
At 30 September 2021 56,097 501 56,598
At 31 December 2020 59,527 289 59,816
((1) )Permits include an amount of €5.0 million related to
Proyecto Touro mining rights.
((2) )Addition resulting from the acquisition of Atalaya Masa
Valverde SLU.
The ultimate recovery of balances carried forward in relation to areas of
interest or assets (including intangibles) is dependent on successful
development, and commercial exploitation, or alternatively the sale of the
respective areas.
The Group conducts impairment testing on an annual basis unless indicators of
impairment are not present at the reporting date. Considering the carrying
value of the assets at Proyecto Riotinto, including the intangible assets and
any impairment thereof, the Group assessed that no indicators were present as
at 30 September 2021 and thus no impairment has been recognised.
10. Inventories
(Euro 000's) 30 Sep 2021 31 Dec 2020
Finished products 3,619 8,642
Materials and supplies 16,354 13,764
Work in progress 1,293 1,170
21,265 23,576
As of 30 September 2021, copper concentrate produced and not sold amounted to
4,232 tonnes (31 Dec 2020: 12,180 tonnes). Accordingly, the inventory for
copper concentrate was €3.6 million (31 Dec 2020: €8.6 million).
Materials and supplies relate mainly to machinery spare parts. Work in
progress represents ore stockpiles, which is ore that has been extracted and
is available for further processing.
11. Trade and other receivables
(Euro 000's) 30 Sep 2021 31 Dec 2020
Non-current
Deposits 301 48
Loans 2,324 2,667
Other non-current receivables 2,696 -
5,321 2,715
Current
Trade receivables at fair value - subject to provisional pricing 6,490 20,304
Trade receivables from shareholders at fair value - subject to provisional
pricing (Note 22.3)
16,202 3,946
Other receivables from related parties at amortised cost (Note 22.3) 56 56
Deposits 21 21
VAT receivables 18,005 15,816
Tax advances - 9
Prepayments 4,476 2,507
Other current assets 141 522
45,391 43,191
Allowance for expected credit losses - -
Total trade and other receivables 50,712 45,906
Trade receivables are shown net of any interest applied to prepayments.
Payment terms are aligned with offtake agreements and market standards and
generally are 7 days on 90% of the invoice and the remaining 10% at the
settlement date which can vary between 1 to 5 months. The fair values of trade
and other receivables approximate to their book values.
Loans are related to an agreement entered by the Group and Lain Technologies
Ltd in relation to the construction of the pilot plan to develop the E-LIX
System. The Loan is secured with the pilot plant, has a grace period of up to
four years and repayment terms depending on future investments on the system.
Amounts drawn down bear interest at 2%.
Non-current deposits included €250k (YTD 2020: €250k) as a collateral for
bank guarantees, which was recorded as restricted cash (or deposit).
Restricted cash related to the collateral was reclassified to non-current
trade and other receivables since the deposit is considered to be long term.
12. Cash and cash equivalents
(Euro 000's) 30 Sep 2021 31 Dec 2020
Cash at bank and in hand 140,854 37,767
As at 30 September 2021, the Group's operating subsidiary held restricted cash
of €15.4 million related to the amount that the Company transferred to a
trust account (the "Trust Account") representing the full amount of interest
claimed by Astor to 30 June 2022, see note on Deferred Consideration.
Cash and cash equivalents denominated in the following currencies:
(Euro 000's) 30 Sep 2021 31 Dec 2020
Euro - functional and presentation currency 28,633 2,431
Great Britain Pound 62 2,019
United States Dollar 112,159 33,317
140,854 37,767
13. Share capital and share premium
Shares Share Capital Share premium Total
000's Stg£'000 Stg£'000 Stg£'000
Authorised
Ordinary shares of Stg £0.075 each* 200,000 15,000 - 15,000
Issued and fully paid
000's Euro 000's Euro 000's Euro 000's
Issue Date Price (£) Details
31 December 2019/1 January 2020 137,340 13,372 314,319 327,691
22 Dec 2020 2.015 Exercised share options ((c)) 228 19 491 510
22 Dec 2020 1.475 Exercised share options ((c)) 41 3 65 68
22 Dec 2020 1.440 Exercised share options ((c)) 499 42 758 800
22 Dec 2020 2.302 Bonus share to former Key management ((d)) 33 3 81 84
000's Euro 000's Euro 000's Euro 000's
31 December 2020/1 January 2021 138,141 13,439 315,714 329,153
12 Feb 2021 2.015 Exercised share options((b)) 41 4 91 95
18 May 2021 2.015 Exercised share options((a)) 20 1 45 46
18 May 2021 1.475 Exercised share options((a)) 10 1 15 16
30 September 2021 138,212 13,445 315,865 329,310
Authorised capital
The Company's authorised share capital is 200,000,000 ordinary shares of Stg
£0.075 each.
Issued capital
(a) On 18 May 2021, the Company was notified that certain employees
exercised options over 30,000 ordinary shares of £0.075 at a price between
£1.475 and £2.015, thus creating a share premium of €61k.
(b) On 12 February 2021, the Company was notified that certain employees
exercised options over 40,750 ordinary shares of £0.075 at a price of
£2.015, thus creating a share premium of €91k.
(c) On 22 December 2020, the Company was notified that certain employees
exercised options over 768,250 ordinary shares of £0.075 at a price between
£1.44 to £2.015, thus creating a share premium of €1,314k.
(d) On 22 December 2020, the Company granted a bonus share to a former Key
management of 33,333 ordinary shares of £0.075 at a price £2.302.
In general, option agreements contain provisions adjusting the exercise price
in certain circumstances including the allotment of fully paid ordinary shares
by way of a capitalisation of the Company's reserves, a sub division or
consolidation of the ordinary shares, a reduction of share capital and offers
or invitations (whether by way of rights issue or otherwise) to the holders of
ordinary shares.
Details of share options outstanding as at 30 September 2021:
Grant date Expiry date Exercise price £ Share options
23 Feb 2017 22 Feb 2022 1.44 314,000
29 May 2019 28-May-2024 2.015 1,003,750
8 July 2019 7 July 2024 2.045 400,000
30 June 2020 29 June 2030 1.475 998,500
24 June 2021 23 June 2031 3.090 1,150,000
Total 3,866,250
Weighted average Share options
exercise price £
At 1 January 2021 1.759 2,787,000
Options executed during the year 2.015 (60,750)
Options executed during the year 1.475 (10,000)
Granted during the year 3.090 1,150,000
30 September 2021 1.754 3,866,250
Warrants
As at 30 September 2021 and 2020 there were no warrants.
14. Other reserves
Share option Bonus share
Fair value reserve of financial assets at FVOCI ((2)) Total
(Euro 000's) Non-Distributable reserve((3))
Depletion factor((1)) Distributable reserve((4))
At 1 January 2020 7,371 208 10,878 (1,144) 3,430 2,093 22,836
Recognition of share- based payments
569 - - - - - 569
Recognition of depletion factor
- - 8,000 - - - 8,000
Recognition of non-distributable reserve
- - - - 2,198 - 2,198
Recognition of distributable reserve
- - - - - - -
Change in fair value of financial assets at fair value through OCI
- - - 52 - - 52
At 30 September 2020 7,940 208 18,878 (1,092) 5,628 2,093 33,655
Recognition of share-based payments 247 - - - - 247
Recognition of depletion factor
- - 6,155 - - - 6,155
Change in fair value of financial assets at fair value through OCI - - - (8) - - (8)
At 31 December 2020 8,187 208 25,033 (1,100) 5,628 2,093 40,049
Recognition of share-based payments
605 - - - - - 605
Recognition of depletion factor
- - (55) - - 6,155 6,100
Recognition of non-distributable reserve
- - - - 2,372 - 2,372
Recognition of distributable reserve
- - - - - 3,317 3,317
Change in fair value of financial assets at fair value through OCI
- - - - (34)
- (34)
At 30 September 2021 8,792 208 24,978 (1,134) 8,000 11,565 52,409
((1) )Depletion factor reserve
At 30 September 2021, the Group has disposed €6.1 million (30 September
2020: €8.0 million) as a depletion factor reserve as per the Spanish
Corporate Tax Act.
((2) )Fair value reserve of financial assets at FVOCI
The Group has elected to recognise changes in the fair value of certain
investments in equity securities in OCI, as explained in (1) above. These
changes are accumulated within the FVOCI reserve within equity. The Group
transfers amounts from this reserve to retained earnings when the relevant
equity securities are derecognised.
((3) )Non-distributable reserve
To comply with Spanish Law, the Group needed to record a reserve when profit
generated equal to a 10% of profit/(loss) for the year until 20% of share
capital is reached.
((4) )Distributable reserve
The Group reclassified 10% of the profit of 2020 to distributable reserves.
15. Trade and other payables
(Euro 000's) 30 Sep 2021 31 Dec 2020
Non-current
Government grant 28 13
Other non-current payables 1,435 1,435
1,463 1,448
Current
Trade payables 47,799 63,946
VAT payables - 4,355
Accruals 4,710 60
Other 42 76
52,551 68,437
Trade payables are mainly for the acquisition of materials, supplies and other
services. These payables do not accrue interest and no guarantees have been
granted. The fair value of trade and other payables approximate their book
values. Trade payables are non-interest-bearing and are normally settled on
60-day terms.
16. Provisions
(Euro 000's) Other tax costs Legal costs Rehabilitation costs
Total costs
1 January 2020 - 388 6,553 6,941
Additions 300 384 684
Finance cost - 62 62
At 30 September 2020 688 6,999 7,687
Additions 11 - 11
(Reduction) / addition of provision (73) 17,495 17,422
Finance cost - 174 174
At 31 December 2020 - 626 24,638 25,264
Additions 2,617 - 510 3,127
Reduction of provision - (278) (43) (321)
Finance cost - - 167 167
At 30 September 2021 2,617 348 25,272 28,237
(Euro 000's) 30 Sep 2021 31 Dec 2020
Non-current 28,237 25,264
Total 28,237 25,264
Rehabilitation provision
Rehabilitation provision represents the accrued cost required to provide
adequate restoration and rehabilitation upon the completion of production
activities. These amounts will be settled when rehabilitation is undertaken,
generally over the project's life.
The discount rate used in the calculation of the net present value of the
provision as at 30 September 2021 was 1.36%, which is the average 15-year
Spain Government Bond rate from 2016-2020 (31 December 2020: 1.36%). An
inflation rate of 1% is applied on annual basis.
Other tax provision
Other tax costs include taxes on (i) construction, installation and works
provision and (ii) other local taxes provision amounting to €2.4 million and
€0.2 million, respectively.
Legal provision
The Group has been named a defendant in several legal actions in Spain, the
outcome of which is not determinable as at 30 September 2021.
17. Borrowings
(Euro 000's) 30 Sep 2021 31 Dec 2020
Non-current borrowings
Credit facilities 42,242 -
42,242 -
Current borrowings
Credit facilities 9,758 -
9,758 -
The Group had uncommitted credit risks totalling €120.5 million. During Q1
2021, Atalaya drawdown some of its existing credit facilities to pay the
Deferred Consideration (Note 19). Interest rates of existing credit
facilities, including facilities used to pay the Deferred Consideration, range
from 1.60% to 2.45% and the average interest rate on all facilities used and
unused is 1.79%. The maximum term of the facilities is three years. In
addition, as at 30 September 2021, the Company had used nil million in
existing credit facilities.
18. Leases liabilities
(Euro 000's) 30 Sep 2021 31 Dec 2020
Non-current
Lease liabilities 5,063 4,796
5,063 4,796
Current
Lease liabilities 600 592
600 592
Lease liabilities
The Group entered into lease arrangements for the renting of land, laboratory
equipment and vehicles which are subject to the adoption of all requirements
of IFRS 16 Leases. The Group has elected not to recognise right-of-use assets
and lease liabilities for short-term leases that have a lease term of 12
months or less and leases of low-value assets. Depreciation expense regarding
leases amounts to €0.4 million (2020: €0.4 million) for the nine month
period ended 30 September 2021. The duration of the land lease is for a period
of thirteen years, payments are due at the beginning of the month escalating
annually on average by 1.5%. At 30 September 2021, the remaining term of this
lease is eleven years and a half.
The duration of the motor vehicle and laboratory equipment lease is for a
period of four years, payments are due at the beginning of the month
escalating annually on average by 1.5%. At 30 September 2021, the remaining
term of this motor vehicle and laboratory equipment lease is one year and a
half, and two years, respectively.
Since the Company acquired 100% of the shares of Cambridge Mineria Espana,
S.L. (renamed to Atalaya Masa Valverde, S.L.U.) in October 2020, a lease
arrangement for a warehouse rent was included. The duration of the warehouse
lease is for a period of thirteen years, payments are due at the beginning of
the month escalating based on the yearly Spanish consumer price index. At 30
September 2021, the remaining term of this lease is eleven years and a half.
(Euro 000's) 30 Sep 2021 31 Dec 2020
Minimum lease payments due:
- Within one year 600 592
- Two to five years 1,678 2,068
- Over five years 3,384 2,728
Present value of minimum lease payments due 5,662 5,388
(Euro 000's) Lease liability
Balance 1 January 2021 5,388
Additions 729
Interest expense 8
Lease payments (463)
Balance at 30 September 2021 5,662
Balance at 30 September 2021
- Non-current liabilities 5,062
- Current liabilities 600
5,662
19. Deferred consideration
In September 2008, the Group moved to 100% ownership of Atalaya Riotinto
Mineral S.L. ("ARM") (and thus full ownership of Proyecto Riotinto) by
acquiring the remaining 49% of the issued capital of ARM. At the time of the
acquisition, the Group signed a Master Agreement (the "Master Agreement") with
Astor Management AG ("Astor") which included a deferred consideration of
€43.9 million (the "Deferred Consideration") payable as consideration in
respect of the acquisition among other items. The Company also entered into a
credit assignment agreement at the same time with a related company of Astor,
Shorthorn AG, pursuant to which the benefit of outstanding loans was assigned
to the Company in consideration for the payment of €9.1 million to Shorthorn
(the "Loan Assignment").
The Master Agreement has been the subject of litigation in the High Court and
the Court of Appeal that has now concluded. As a consequence, ARM must apply
any excess cash (after payment of operating expenses, sustaining capital
expenditure, any senior debt service requirements and up to US$10 million per
annum (for non-Proyecto Riotinto related expenses)) to pay the consideration
due to Astor (including the Deferred Consideration and the amount of €9.1
million payable under the Loan Assignment). "Excess cash" is not defined in
the Master Agreement leaving ambiguity as to how it is to be calculated.
On 2 March 2020, the Company filed an application in the High Court to seek
clarity on the definition of "Excess Cash". The Company and Astor have now
exchanged statements of case to set out their formal position. The trial is
listed to be heard from 21 February 2022 (the "Trial"). Following the filing
of the statements of case for the Trial, Astor applied to Court seeking an
early determination (without the need for a full trial) of the dispute in
relation to the "Excess Cash" (the "Summary Judgment application"). The
Summary Judgment application was heard on 14-15 June 2021. The Court dismissed
Astor's application and the question as to whether any residual interest is
payable to Astor therefore remains to be resolved at Trial.
As previously announced, during December 2020 the Board had discussions and
considered an early payment of the Deferred Consideration and the Loan
Assignment provided certain conditions could be met. Conditions included among
others the execution of credit facilities agreements to fund the payment.
In March 2021, the Company fulfilled all conditions required by the Board of
Directors and made the early payment of €53 million to Astor. The payment
was fully funded by unsecured credit facilities entered into between December
2020 and February 2021 at interest rates ranging from 1.60% to 2.45% and
repayable by 2023 and 2024.
The payment of the Deferred Consideration does not end the ongoing litigation
as the issue as to whether any residual interest may or may not be payable
remains unresolved. Consequently, on 15 July 2021, the Company transferred
€15.4 million to a trust account (the "Trust Account") representing the full
amount of interest claimed by Astor to 30 June 2022. The holder of the Trust
Account has provided an undertaking to hold the full amount until settlement
of the claim to interest or judgment following the Trial. The Company
understands the monies held in the Trust Account safeguard the maximum
outstanding liability to Astor in relation to the Master Agreement. On that
basis, and because the Consideration has been paid in full in accordance with
the Master Agreement, Atalaya treats itself as free of the obligations set out
in the Master Agreement.
The Company is currently working on other court directions in preparation for
the Trial and continues to be confident in its case and is of the view that no
interest will be payable to Astor.
20. Acquisition, incorporation and disposal of subsidiaries
There were neither acquisition nor incorporation of subsidiaries during the
nine month period to 30 September 2021.
21. Wind-up of subsidiaries
There were no subsidiaries wound-up during the nine month period to 30
September 2021.
22. Related party transactions
The following transactions were carried out with related parties:
22.1 Compensation of key management personnel
The total remuneration and fees of Directors (including Executive Directors)
and other key management personnel was as follows:
Three months ended Three months ended Nine months ended 30 Sep 2021 Nine months ended
30 Sep 2021 30 Sep 2020 30 Sep 2020
(Euro 000's)
Directors' remuneration and fees 265 246 770 758
Director´s bonus ((1)) - - 438 -
Share option-based benefits and other benefits to directors 130 90 241 202
Key management personnel fees 139 130 399 379
Key management bonus ((1)) - - 265 -
Share option-based and other benefits to key management personnel 220 108 350 266
754 574 2,463 1,605
((1) )These amounts in 2021 related to the performance bonus for
2020 approved by the Board of Directors of the Company during H1 2021.
Director's bonus relates to the amount approved for the CEO as an executive
director and key management bonus relates to the amount approved for other key
management personnel which are not directors of Atalaya Mining plc. Bonuses
for 2019 were recorded in Q4 2020 and hence no amounts are disclosed for the
comparative for Q3 YTD period.
22.2 Share-based benefits
On 25 June 2021, the Company announced that in accordance with the Company's
Long Term Inventive Plan 2020 which was approved by shareholders at the Annual
General Meeting on 25 June 2020, it has granted 1,150,000 share options to
Persons Discharging Managerial Responsibilities and other management.
22.3 Transactions with related parties/shareholders
i) Transaction with shareholders
Three months ended Three months ended Nine months ended Nine months ended
30 Sep 2021 30 Sep 2020 30 Sep 2021 30 Sep 2020
(Euro 000's)
Trafigura- Revenue from contracts 45,460 19,148 96,390 32,096
Freight services - - - -
45,460 19,148 96,390 32,096
Gain relating provisional pricing within sales (2,032) (2,574) (3,682) (1,275)
Trafigura - Total revenue from contracts 43,428 16,573 92,708 30,821
ii) Period-end balances with related parties
(Euro 000's) 30 Sep 2021 31 Dec 2020
Receivables from related parties:
Recursos Cuenca Minera S.L. 56 56
Total (Note10) 56 56
The above balances bear no interest and are repayable on demand.
iii) Period-end balances with shareholders
(Euro 000's) 30 Sep 2021 31 Dec 2020
Trafigura - Debtor balance- subject to provisional pricing 16,202 3,946
Total (Note 10) 16,202 3,946
The above debtor balance arising from sales of goods and other balances bear
no interest and is repayable on demand.
23. Contingent liabilities
Judicial and administrative cases
In the normal course of business, the Group may be involved in legal
proceedings, claims and assessments. Such matters are subject to many
uncertainties, and outcomes are not predictable with assurance. Legal fees for
such matters are expensed as incurred and the Group accrues for adverse
outcomes as they become probable and estimable.
24. Commitments
There are no minimum exploration requirements at Proyecto Riotinto. However,
the Group is obliged to pay local land taxes which currently are approximately
€235,000 per year in Spain and the Group is required to maintain the
Riotinto site in compliance with all applicable regulatory requirements.
In 2012, ARM entered into a 50/50 joint venture with Rumbo to evaluate and
exploit the potential of the class B resources in the tailings dam and waste
areas at Proyecto Riotinto (mainly residual gold and silver in the old gossan
tailings). Under the joint venture agreement, ARM will be the operator of the
joint venture, will reimburse Rumbo for the costs associated with the
application for classification of the Class B resources and will fund the
initial expenditure of a feasibility study up to a maximum of €2.0 million.
Costs are then borne by the joint venture partners in accordance with their
respective ownership interests.
25. Significant events
The "Dirección Xeral de Calidade Ambiental e Cambio Climático", (the General
Directorate for the Environment and Climate Change of Galicia), announced on
28 January 2020 that a negative Environmental Impact Statement for Proyecto
Touro (Declaración de Impacto Ambiental) had been signed.
The short release stated that the decision was based on two reports which form
part of a wider evaluation consisting of fifteen reports produced by different
departments of the Xunta de Galicia. These two reports challenge the ability
of the Company to guarantee that there will be no environmental impact of the
Project on the Ulla River and related protected ecosystems which are located
downstream.
On 1 March 2021, Atalaya received the formal communication from Xunta de
Galicia of the negative Environmental Impact Declaration on Proyecto Touro.
On 10 February 2021, the Company announced that its Board of Directors had
appointed Mr. Neil Gregson as an independent Non-Executive Director of the
Company.
On 12 February 2021, the Company was notified that certain employees exercised
options over 40,750 ordinary shares of £0.075.
On 15 March 2021, Atalaya announced that it has made the payment of the €53
million (the "Deferred Consideration") to Astor Management following the
approval of its Board of Directors. This amount arises from arrangements
entered with Astor in 2008 in relation to Proyecto Riotinto. The payment was
financed with unsecured credit lines by four major Spanish banks having a
three-year tenure and an average annual interest rate of approximately two per
cent.
On 25 March 2021, the Company announced that Dr. José Nicolas Sierra who
retired as an Independent Non-Executive Director and the Chair of the Physical
Risk Committee of Atalaya, with an effective date of 31 March 2021.
On 12 April 2021, the Company announced that Mr. Damon Barber stepped down as
a Non-Executive Director of the Company with immediate effect.
On 17 May 2021, the Company was notified that Harry Liu, Director of the
Company, sold 5,000 ordinary shares in Atalaya at an average price of 356.0
pence per share.
On 18 May 2021, the Company was notified that Harry Liu, Director of the
Company, sold 3,698 ordinary shares in Atalaya at an average price of 358.0
pence per share.
On 26 May 2021, Liberty Metals & Mining Holdings, LLC, shareholder of the
Company, reduced its % of voting rights from 14.17% to 12.97%.
On 25 June 2021, the Company announced that in accordance with the Company's
Long Term Inventive Plan 2020 which was approved by shareholders at the Annual
General Meeting on 25 June 2020, it has granted 1,150,000 share options to
Persons Discharging Managerial Responsibilities and other management.
The Options expire ten years from the deemed date of grant (24 June 2021),
have an exercise price of 309.0 pence per ordinary share, based on the average
of the mid-market closing prices for the five dealing days immediately
preceding the grant date, and vest in two equal tranches, half on grant and
half on the first anniversary of the granting date.
On 29 June 2021, the Company was notified that Harry Liu, Director of the
Company, sold 5,000 ordinary shares in Atalaya at an average price of 310.0
pence per share. On 1 July 2021 the Company announced that it was notified
that Harry Liu, Director of the Company, sold 192 ordinary shares in Atalaya
at an average price of 308.0 pence per share.
On 5 July 2021, the Company announced that it was notified, that Alberto
Lavandeira, Chief Executive Officer and Managing Director of the Company,
purchased 40,000 ordinary shares at an average price of 310.0 pence per share.
The Company was also notified on 3 July 2021, that Harry Liu, Director of the
Company, sold, on 1 July 2021, 170 ordinary shares in Atalaya at an average
price of 309.0 pence per share.
Following the above transactions Mr Lavandeira and Mr. Liu are interested in
an aggregate of 280,000 and 386,019 ordinary shares of the Company
representing 0.20% and 0.28% of the current issued share capital,
respectively.
On 15 July 2021, the Company transferred €15.4 million to a trust account
(the "Trust Account") representing the full amount of interest claimed by
Astor to 30 June 2022. The holder of the Trust Account has provided an
undertaking to hold the full amount until settlement of the claim to interest
or judgment following the trial in February 2022. The Company understands the
monies held in the Trust Account safeguard the maximum outstanding liability
to Astor in relation to the Master Agreement. On that basis, and because the
Consideration has been paid in full in accordance with the Master Agreement,
Atalaya treats itself as free of the obligations set out in the Master
Agreements (refer to Note 19). The Company is currently working on other court
directions in preparation for the Trial and continues to be confident in its
case and is of the view that no residual intertest should be payable to Astor.
On 13 August 2021, the Company was notified that Harry Liu, Director of the
Company, sold 11,000 ordinary shares in Atalaya at an average price of 324.0
pence per share.
On 4 August 2021, Liberty Metals & Mining Holdings, LLC, shareholder of
the Company, reduced its % of voting rights from 11.79% to 10.94%.. And on 18
August 2021, Liberty Metals & Mining Holdings, LLC, shareholder of the
Company, reduced its % of voting rights to nil.
On 20 August 2021, a new shareholder of the Company, Polar Capital LLP,
acquired 5.08% of voting rights
On 6 October 2021, the Company announced that the recent drilling campaign has
intersected broad intervals of massive and stockwork type polymetallic
sulphide mineralization including significant high-grade intercepts at both
Masa Valverde and Majadales.
26. Events after the reporting period
Dividends
Following the expansion of Proyecto Riotinto's processing capacity to 15 Mtpa,
Atalaya has been generating robust cash flow as a result of the plant
consistently operating above nameplate capacity, coupled with the strong
copper price environment.
Accordingly, on 27 October 2021, Atalaya initiated a sustainable dividend
policy that will allow for continued investments in its portfolio of low
capital intensity growth projects, such as the San Dionisio deposit, Proyecto
Masa Valverde and Proyecto Touro.
Dividend Policy
Consistent with its strategy to create and deliver shareholder value, the
Company approved a Dividend Policy that will make an annual payout of between
30% and 50% of free cash flow generated during the applicable financial year.
The Dividend Policy will take effect in financial year 2022. The annual
Ordinary Dividend will be paid in two half-yearly instalments and announced in
conjunction with future interim and full year results.
The declaration and payment of all future dividends under the new policy will
remain subject to approval by the Board of Directors.
Inaugural Dividend
Also on 27 October 2021, the Board of Directors elected to declare an
Inaugural Dividend of US$0.395 per ordinary share, which was equivalent to
£0.294 per share or €0.345 per share.
The record date for the Inaugural Dividend was 5 November 2021 and the shares
became ex-dividend on 4 November 2021.
The Inaugural Dividend will be paid on 1 December 2021 in US Dollars, with an
option for shareholders to elect to receive the dividend in Sterling or Euros.
Shareholders were required to communicate their currency election to the
Company by no later than 11 November 2021. The exchange rates for payments in
Sterling and Euros were fixed by Atalaya on 15 November 2021 and subsequently
announced.
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