REG-Base Resources Limited: FY22 Half-Year Results
28/02/2022 07:15
AIM and Media Release
28 February 2022
BASE RESOURCES LIMITED
Ongoing price increases and operational consistency drive strong financial
performance
African mineral sands producer and developer, Base Resources Limited (ASX &
AIM: BSE) (Base Resources or the Company) is pleased to present its results
for the six-month period ended 31 December 2021 (H1 FY22, reporting period or
half-year), which include announcement of an interim dividend of AUD 3 cents
per share (unfranked), and the following extracts from the Half-Year Financial
Report for the Company and its controlled entities (Group) for the same
period.
1. Review of Operations
2. Market Developments and Outlook
3. Kwale Operations Extensional Opportunities
4. Toliara Project
5. Review of Financial Performance
6. After Balance Date Events
7. Consolidated Condensed Statement of Profit or Loss and Other Comprehensive
Income
8. Consolidated Condensed Statement of Financial Position
9. Consolidated Condensed Statement of Changes in Equity
10. Consolidated Condensed Statement of Cash Flows
The extracts from the Half-Year Financial Report should be read in conjunction
with the notes contained in the full version of that report, a copy of which
is available from the Company’s website: www.baseresources.com.au. The
full version of the Half-Year Financial Report also contains the auditor’s
independence declaration, the directors’ declaration and the auditor’s
review report.
The Company has also released a presentation to accompany its Half-Year
Financial Report. The presentation contains, among other things, further
details about the Company’s half-year results and details about the
Company’s expected capital expenditure for the six-month period ending 30
June 2022. A copy of the presentation is available from the Company’s
website: www.baseresources.com.au.
All references to currency ($ or US$) is United States Dollars, unless
otherwise stated.
Highlights
Kwale Operations performed strongly, maintaining operational continuity
throughout the period with effective controls to mitigate COVID-19 risks and
impacts. Markets for all mineral sands products saw high levels of demand
over the period, supporting continued price improvement for all products.
Kwale Operations mine life was extended to late 2023 with additional
initiatives to secure further mine life extensions progressed.
The Toliara Project in Madagascar continues to represent a significant and
attractive growth opportunity for the Company, with discussions with the
Government of Madagascar on the fiscal terms applicable to the project and the
lifting of the on-the-ground suspension continuing.
Financial highlights for H1 FY22
* Record first-half revenue of US$104.6 million following increased production
and an 18% increase in average realised unit sales price compared to the
six-month period ended 31 December 2020 (H1 FY21comparative period).
* EBITDA of US$54.2 million.
* Net profit after tax increased to US$19.2 million, from a net loss of US$6.4
million in H1 FY21, partially due to reduced depreciation following the
extension of Kwale Operations’ mine life.
* Free cashflow of US$8.8 million (operating cashflows of US$20.6 million less
investing cashflows of US$11.9 million) was impacted by the previously
announced US$18.8 million catch-up royalty payments to the Government of Kenya
during the period.
* Net cash position of US$37.1 million at 31 December 2021.
Interim dividend of AUD 3.0 cents per share determined
The Company’s capital management policy is that cash not required to meet
the Company’s near-term growth and development requirements, or to maintain
requisite balance sheet strength in light of prevailing circumstances, could
be expected to be returned to shareholders. With net cash of US$37.1 million
at the end of the period, continued strong financial performance and the
timing of the Toliara Project final investment decision still uncertain, the
Board has determined an interim dividend of AUD 3.0 cents per share
(unfranked), totalling AUD$35.3 million in aggregate (approximately US$25.0
million) that will be paid wholly from conduit foreign income. The record
date for the interim dividend is 14 March 2022 and the payment date is 31
March 2022 – refer to Base Resources’ accompanying announcement “FY22
Interim Dividend – Key dates and information” for further information
about the dividend.
Upon payment of the FY22 interim dividend, dividends distributed to
shareholders since October 2020 will total AUD 13.5 cents per share, equal to
AUD$159.6 million in aggregate (approximately US$116.2 million).
Operational and development highlights for H1 FY22
* Production of 36,180 tonnes of rutile, 156,877 tonnes of ilmenite and 12,849
tonnes of zircon from Kwale Operations.
* Continued strengthening of demand for all products, with increases in
achieved prices of 12% for rutile, 43% for ilmenite and 36% for zircon
compared to H1 FY21.
* Kwale Operations mine life extended to late 2023 following finalisation of
the Kwale South Dune mining lease extension.
* Bumamani pre-feasibility study (PFS) completed and concluded that higher
grade subsets of the Bumamani and Kwale North Dune deposits can be
economically mined, which would extend Kwale mine life to mid-2024(1).Bumamani
definitive feasibility study (DFS) progressed and nearing completion.
* Three Tanzanian prospecting licences granted and exploration underway, with
231 shallow auger holes completed.
* Toliara Project enhanced DFS (DFS2) completed, with increased mining and
processing scale underpinned by a significant growth in estimated Ore
Reserves, increasing the project’s post-tax / pre-debt (real) NPV @ 10%
discount rate to US$1.0 billion(2).
[Note (1): For further information, refer to Base Resources’ announcements
on 3 September 2021 “Bumamani PFS supports extension of Kwale mine life”
and “Further supporting information for Bumamani PFS”. Base Resources
confirms that all the material assumptions underpinning the production
information and forecast financial information in these announcements continue
to apply and have not materially changed.]
[Note (2): For further information, refer to Base Resources’ announcement on
27 September 2021 “DFS2 enhances scale and economics of the Toliara
Project”. Base Resources confirms that all the material assumptions
underpinning the production information and forecast financial information in
this announcement continue to apply and have not materially changed.]
Managing Director of Base Resources, Tim Carstens, said:
“Operationally, we have delivered a strong first half with consistent mining
at Kwale and improved ore grade lifting production. Ongoing strong demand
for all of our products is resulting in significant price increases which have
contributed to increases in group revenue, EBITDA and NPAT. This, and a
disciplined approach to capital management, has enabled continuation of
meaningful returns to shareholders with the determination of a fourth
consecutive dividend.”
“Given the value creation lever it represents, the extension of mine life at
Kwale Operations is an intense focus. With the finalisation of a mining
lease extension, we have successfully secured mine life at Kwale until late
2023. Looking beyond this, the PFS on mining the Bumamani and higher-grade
subsets of the North Dune deposits has now been completed, with the DFS well
underway and on schedule for completion in the June quarter this year. The
inclusion of an additional pit area in the DFS could further extend Kwale mine
life to late 2024. We continue to pursue both near mine extension
initiatives and regional exploration opportunities, with exploration
commencing in northern Tanzania and prospective tenure in Kenya being
progressed towards licensing. Our stakeholders – employees, communities,
governments, customers and shareholders – are aligned in a desire to extend
our successful presence in East Africa.”
“The Toliara Project in Madagascar continues to represent a significant
growth opportunity for Base Resources. The release of an enhanced DFS
incorporating an increased scale, supported by a substantial increase in Ore
Reserves and improvement in the long-term supply-demand outlook for mineral
sands, has further revealed the Toliara Project’s potential. We are fully
committed to realising that value, with the next catalyst to achieving this
being securing fiscal terms with the Government of Madagascar. Discussions
with respect to the project’s fiscal terms are ongoing and we remain
confident that acceptable terms will be able to be secured.”
“We are operating in a mineral sands sector that both enjoys a robust
pricing environment in the short term and an attractive supply/demand outlook
in the longer term. With a Kwale operation consistently delivering
significant cashflow and a development ready Toliara Project with outstanding
economics, Base Resources is well positioned to capitalise on this outlook and
actively considering wider growth opportunities that can further enhance that
position.”
Investor and shareholder webcast
The webcast will be hosted by Base Resources’ Managing Director, Tim
Carstens, Chief Financial Officer, Kevin Balloch, and General Manager -
Marketing, Stephen Hay, who will each also be available to answer questions
following a presentation of the Company’s results.
Details for the webcast are below. Participants will be able to ask
questions via the messaging function on the webcast platform or via the
teleconference line. Participants proposing to use the teleconference line
will need to pre-register their details using the teleconference registration
URL provided below. Upon registering, participants will receive an email
with their unique PIN and dial-in details so that they can join the call on
the day without needing to speak with an operator.
* Date: Monday, 28 February 2022
* Time: 5.00pm AWST / 9.00am GMT
* Webcast URL: https://edge.media-server.com/mmc/p/5fp4rz36
* Teleconference registration URL:
https://s1.c-conf.com/diamondpass/10019890-asm222d.html
Extracts from half-year Financial Report
1. Review of Operations
Base Resources operates the 100% owned Kwale Operations in Kenya, which
commenced production in late 2013. Kwale Operations is located 50 kilometres
south of Mombasa, the principal port facility for East Africa. Mining
operations continued according to plan on the South Dune orebody with
approximately 8.7 million tonnes mined (comparative period: 8.5 million
tonnes). The higher ore tonnes and improved grade of ore mined in the
reporting period has resulted in a 7% increase in the contained valuable heavy
mineral (rutile, ilmenite and zircon) mined.
Mining, Production and Sales Six months to Six months to
Dec 2021 Dec 2020
Ore mined (tonnes) 8,680,545 8,538,666
Heavy mineral (HM) % 3.54% 3.28%
Valuable heavy mineral (VHM) % 2.71% 2.59%
Production (tonnes)
Ilmenite 156,877 144,363
Rutile 36,180 33,684
Zircon 12,489 12,677
Zircon low grade 1,062 942
Rutile low grade 970 -
Sales (tonnes)
Ilmenite 164,080 129,300
Rutile 25,383 23,668
Zircon 11,787 13,735
Zircon low grade 1,179 505
Rutile low grade 919 -
Stable recoveries in both the wet concentrator plant (WCP) and mineral
separation plant (MSP) resulted in a higher production of rutile and ilmenite
by 7% and 9% respectively. Zircon production was 1% lower than the
comparative period due to lower contained zircon in the mineral assemblage of
ore mined and marginally lower MSP recoveries. Heavy mineral concentrate
(HMC) stocks closed the reporting period marginally higher at 23,135 tonnes
(19,841 tonnes as at 30 June 2021).
Production of two streams of low-grade concentrate products (zircon and
rutile) occurred in the reporting period, together they had a contained 661
tonnes of zircon and 1,337 tonnes of rutile.
There were no lost time injuries during the reporting period, at Kwale
Operations or the Toliara Project, resulting in a lost time injury frequency
rate (LTIFR) for Base Resources of zero. Compared to the Western Australian
All Mines 2019/2020 LTIFR of 2.1, this is an exceptional performance,
reflective of the ongoing focus and importance placed on safety by
management. Base Resources group employees and contractors had worked 26.9
million hours lost time injury (LTI) free, with the last LTI recorded in early
2014. With two medical treatment injuries recorded in the last 12 months,
both within the reporting period, Base Resources’ total recordable injury
frequency rate is 0.50 per million hours worked.
The Company maintains a balanced portfolio of multi-year and quarterly offtake
agreements with long term customers, supplemented by a small proportion of
ongoing spot sales. These agreements, with some of the world’s largest
consumers of titanium dioxide feedstocks and zircon products, provide
certainty for Kwale Operations by securing minimum offtake quantities. Sales
prices in these agreements are typically either negotiated on a
shipment-by-shipment basis or set for periods of up to six months and are
derived from prevailing market prices. The strength of the mineral sands
market for all products in the reporting period ensured that sales continued
to closely match production, with minimal inventories being maintained.
2. Market Developments and Outlook
Titanium Dioxide
Ilmenite and rutile are primarily used as feedstock for the production of
titanium dioxide (TiO(2)) pigment, with a small percentage also used in the
production of titanium metal and fluxes for welding rods and wire. TiO(2) is
the most widely used white pigment because of its non-toxicity, brightness and
very high refractive index. It is an essential component of consumer
products such as paint, plastics and paper. Pigment demand is therefore the
major driver of ilmenite and rutile pricing.
Major western pigment producers typically use high grade TiO(2) feedstocks
(which includes rutile) while Chinese pigment producers typically rely on
sulphate ilmenite as their main feedstock.
Inventories of TiO(2) pigment throughout the supply chain have remained at
very low levels since mid-way through the 2021 financial year due to demand
continuing to outpace pigment production capacity across all regions.
Western pigment producers have continued to target capacity production levels
and have been preferentially seeking the highest grade TiO(2) feedstocks
(particularly rutile) in order to maximise yield. During the reporting
period, some major chloride pigment producers reported that, due to logistics
challenges and a shortage of raw materials (including TiO(2) feedstock), they
were not able to achieve capacity production rates and could not meet all of
the demand from their customers, a situation likely to continue through until
at least the mid-way point of the second half of financial year 2022.
The impact of the very strong demand for rutile by western pigment producers
has been compounded by the strong rebound in demand from the welding and
titanium metals sectors. Demand from these sectors has continued to
strengthen through the reporting period and is expected to continue into the
second half of financial year 2022. At the same time, supply of natural
rutile and other high-grade feedstocks have been significantly constrained by
a variety of issues at some major production plants and uncertainty remains
over the ability of some of those producers to achieve steady state production
going forward. The resultant tightness in the market has led to a 12%
increase in the average achieved price of Base Resources rutile from the
comparative period.
Despite uncertainties in China relating to power supply, COVID-19 outbreaks,
the property sector and environmental controls, the pigment market has held up
well and demand for ilmenite, as the main source of TiO(2) feedstock for
Chinese producers, has continued to be very strong. Chinese pigment
producers have continued to target capacity production levels through the
reporting period and Chinese pigment exports remain very strong, benefiting
from the shortage of supply from western pigment producers. Overall,
ilmenite supply has increased in response to the tight market conditions and
high prices but this has not been sufficient to meet demand. The supply
deficit has resulted in the average achieved price for Base Resources ilmenite
increasing 43% from the comparative period.
Zircon
Zircon has a range of end-uses, the predominant of which is in the production
of ceramic tiles, accounting for more than 50% of global zircon consumption.
Milled zircon enables ceramic tile manufacturers to achieve brilliant opacity,
whiteness and brightness in their products. Zircon’s unique properties
include heat and wear resistance, stability, opacity, hardness and strength,
making it sought after for other applications such as refractories, foundries
and specialty chemicals.
Demand growth for zircon is closely linked to growth in global construction
and increasing urbanisation in the developing world.
Demand for zircon in all sectors continued to strengthen through the reporting
period. European zircon ceramic millers have struggled to source sufficient
zircon sand to meet their targeted capacity production levels and continue to
seek more zircon than is available. Despite the challenges and uncertainties
in China referred to above, demand for zircon from Chinese users has remained
firm. The chemical zirconia and refractory sectors have been particularly
strong and Chinese zircon ceramic millers have continued to target high
production rates. Low inventory levels, supply chain delays and restricted
supply of zircon into China from some major zircon producers has maintained
tightness in the Chinese market into the start of 2022. These very tight
market conditions have led to a 36% increase in the average achieved price for
Base Resources zircon from the comparative period.
3. Kwale Operations Extensional Opportunities
During the reporting period the Company extended the boundary of the Kwale
Special Mining Lease 23 (SML 23) to incorporate previously identified
additional Mineral Resources, leading to the Kwale South Dune Ore Reserves
estimates increasing and extending mine life to December 2023.
In addition, Base Resources completed the Bumamani PFS in the reporting period
which concluded that it was economically viable to mine the Bumamani and
higher-grade subsets of the Kwale North Dune deposits, which would extend mine
life at Kwale Operations to July 2024. The Company is now progressing a DFS
and an application to further extend SML 23 to cover these areas has been
lodged. The Bumamani DFS is expected to be completed in the second half of
the financial year.
Prospecting licence applications lodged for an area in the Kuranze region of
Kwale county, about 70 km west of Kwale Operations), together with an area
south of Lamu, remain in process towards granting. In November 2019, the
Government of Kenya imposed an industry wide moratorium on the issuance of
prospecting licences which has affected the progress of all licence
applications. The Company continues to work with the Government, and other
mining sector stakeholders, to see the moratorium lifted to enable the
recommencement of the issuance of mineral rights.
Base Resources’ wholly-owned Tanzanian subsidiary was granted three
prospecting licences in Tanzania for areas adjacent to the Kuranze region in
Kenya with a fourth licence pending. A shallow auger drilling program is
underway to assess geochemical anomalies and identify future air core drilling
targets, with 231 holes completed in the reporting period. Sample assaying
is in progress at the Kwale Operations laboratory, with infill auger drilling
and test pits planned in the second half of the financial year to better
understand the more prospective areas.
4. Toliara Project
In November 2019, the Government of Madagascar required Base Resources to
suspend on-the-ground activity on the Toliara Project while discussions on
fiscal terms applying to the project were progressed. Activity remains
suspended as Base Resources continues to engage the Government in relation to
the country’s Large Mining Investment Law (LGIM) regime, fiscal terms
applicable to the Toliara Project and the lifting of the on-the-ground
suspension, with discussions continuing during the reporting period.
In September 2021, the Company completed DFS2 for the Toliara Project to
incorporate an update to the estimated Ranobe Ore Reserves and an increase in
project scale. The outcomes of DFS2, compared to the earlier 2019 DFS,
included substantially improved forecast financial returns for the Toliara
Project, including a post-tax/pre-debt (real) NPV10 of US$1.0 billion and an
average revenue to cost of sales ratio of 3.5, over an initial 38-year mine
life. Timing of a financial investment decision (FID) in respect of the
Toliara Project (and therefore commencement of construction) remains subject
to lifting of the suspension of on-the-ground activities and agreeing
acceptable fiscal terms with the Government of Madagascar. Once these two
key milestones are achieved, there will be approximately 11 months’ work to
complete prior to reaching FID, including finalisation of funding, completion
of land acquisition, conclusion of major construction contracts and entering
into offtake agreements with customers. Resumption of reasonable
international travel will also be required to complete a significant portion
of this pre-FID work. Following FID, there is an estimated 27 month
construction and commissioning period to reach the first shipment of
production. The Company maintains readiness to accelerate progress when
conditions support.
5. Review of Financial Performance
Base Resources achieved a profit after tax of US$19.2 million for the
reporting period, an increase compared with a loss of US$6.3 million in the
comparative period, primarily due to higher sales revenues.
Six months to 31 December 2021 Six months to 31 December 2020
Kwale Operations Toliara Project Other Total Kwale Operations Toliara Project Other Total
US$000s US$000s US$000s US$000s US$000s US$000s US$000s US$000s
Sales Revenue 104,615 - - 104,615 72,763 - - 72,763
Cost of goods sold excluding depreciation & amortisation:
Operating costs (35,919) - - (35,919) (33,376) - - (33,376)
Inventory movement 6,771 - - 6,771 9,455 - - 9,455
Royalties expense (7,754) - - (7,754) (5,069) - - (5,069)
Total cost of goods sold ((i)) (36,902) - - (36,902) (28,990) - - (28,990)
Corporate & external affairs (1,817) (54) (3,947) (5,818) (1,854) (38) (3,698) (5,590)
Community development (2,228) - - (2,228) (2,071) - - (2,071)
Selling & distribution costs (1,461) - - (1,461) (881) - - (881)
COVID-19 response costs (102) - - (102) (975) - - (975)
Net write-off of Kenyan VAT receivable and royalty payable (3,012) - - (3,012) - - - -
Other expenses (35) - (823) (858) (28) - (310) (338)
EBITDA ((i)) 59,058 (54) (4,771) 54,234 37,964 (38) (4,008) 33,918
Depreciation & amortisation (22,404) (94) (198) (22,696) (29,224) (101) (161) (29,486)
EBIT ((i)) 36,654 (148) (4,968) 31,538 8,740 (139) (4,169) 4,432
Net financing (expenses) / income (2,783) - 311 (2,472) (3,320) - (105) (3,425)
Income tax expense (5,352) - (4,500) (9,852) (2,845) - (4,500) (7,345)
NPAT ((i)) 28,519 (148) (9,157) 19,214 2,575 (139) (8,774) (6,338)
((i)) Base Resources’ financial results are reported under International
Financial Reporting Standards (IFRS). These Financial Statements include
certain non-IFRS measures including EBITDA, EBIT and NPAT. These measures are
presented to enable understanding of the underlying performance of the Group
and have not been audited/reviewed.
Sales revenue increased 44% to US$104.6 million for the reporting period
(comparative period: US$72.8 million) due to higher sales volumes and an 18%
increase in the average price of product sold to US$514 per tonne (comparative
period: US$435 per tonne), with higher prices achieved across all products.
Total operating costs of US$35.9 million were 8% higher than the comparative
period (US$33.4 million), due to a 9% increase in production volume, with
operating costs per tonne produced remaining stable at US$171 per tonne
(comparative period: US$174 per tonne).
Cost of goods sold (operating costs, adjusted for stockpile movements, and
royalties), was US$185 per tonne of product sold, 4% lower than the
comparative period (US$192 per tonne) due to lower unit operating costs and
product sales mix.
With a margin of US$329 per tonne sold for the reporting period (comparative
period: US$243 per tonne) and an achieved revenue to cost of sales ratio of
2.8 in the reporting period (comparative period: 2.3), Base Resources remains
well positioned amongst mineral sands producers.
The increased sales volume together with higher product prices have delivered
an increased Kwale Operations EBITDA for the reporting period of US$59.1
million (comparative period: US$38.0 million) and a Group EBITDA of US$54.2
million (comparative period: US$33.9 million).
The majority of Kwale Operations assets are depreciated on a straight-line
basis over the remaining mine life. During the reporting period the Kwale
South Dune Ore Reserves estimate was increased, allowing depreciation and
amortisation charges to be spread over a longer remaining mine life.
Accordingly, depreciation and amortisation in the reporting period decreased
24% to US$22.7 million (comparative period: US$29.5 million).
Due to increased EBITDA and reduced depreciation and amortisation, Kwale
operations recorded a net profit after tax of US$28.5 million (comparative
period: US$2.6 million). During the reporting period, the Group’s Kenyan
subsidiary, Base Titanium Limited (Base Titanium), distributed US$30.0 million
of surplus cash, via dividend, to the Group’s ultimate parent entity, Base
Resources Limited. The dividend distribution by Base Titanium incurred 15%
Kenyan dividend withholding tax of US$4.5 million, which has been recorded as
an income tax expense, thus contributing to a profit after tax of
US$19.2 million for the Group (comparative period: loss of US$6.3 million).
Cash flow from operations was US$20.6 million for the reporting period
(comparative period: US$31.1 million), lower than Group EBITDA due to Base
Titanium settling previously provided for increased royalties(3) totalling
US$18.8 million upon reaching agreement with the Government of Kenya. Base
Titanium also paid corporate tax instalments of US$8.1 million and Kenyan
dividend withholding tax of US$9.0 million to the Government of Kenya (US$4.5m
payable from 30 June 2021) on the distribution of surplus cash to Base
Resources. Operating cashflows were used to fund capital expenditure at
Kwale Operations, Toliara Project progression and dividend distribution.
Total capital expenditure for the Group was US$12.0 million in the reporting
period (comparative period: US$13.0 million) comprised of US$5.8 million at
Kwale Operations (comparative period: US$5.1 million), primarily for extending
mining further south and land compensation for SML 23 extension, and US$4.1
million on the progression of the Toliara Project (comparative period: US$7.5
million).
Consistent with Base Resources’ strategy, the Group seeks to provide returns
to shareholders through both long-term growth in the Base Resources share
price and appropriate cash distributions. Cash not required to meet the
Group’s near-term growth and development requirements, or to maintain
requisite balance sheet strength in light of prevailing circumstances could be
expected to be returned to shareholders.
Applying this capital management policy, the Board determined to pay an
interim dividend of AUD 3 cents per share, unfranked, with a record date of 14
March 2022 and payment date of 31 March 2022. The interim dividend will be
paid wholly from conduit foreign income. The financial impact of the interim
dividend, estimated to be approximately US$25.0 million (based on the
prevailing AUD:USD exchange rate), has not been recognised in the Consolidated
Interim Financial Statements for the reporting period.
[Note (3): Refer to Base Resources’ market announcement “Kwale mining
lease extension secured and royalty discussions finalised” released on 30
September 2021 for further information, which is available at
https://baseresources.com.au/investors/announcements/.]
6. After Balance Date Events
Other than the interim dividend determined by the Board, there have been no
other significant events since the reporting period.
7. Consolidated Condensed Statement of Profit or Loss and Other
Comprehensive Income
6 months to 6 months to
31 December 2021 31 December 2020
Note US$000s US$000s
Sales revenue 2 104,615 72,763
Cost of sales 3 (59,307) (58,214)
Profit from operations 45,308 14,549
Corporate and external affairs (6,109) (5,852)
Community development costs (2,228) (2,071)
Selling and distribution costs (1,461) (881)
COVID-19 response costs (102) (975)
Net write-off of Kenyan VAT receivable and royalty over accrual 4 (3,012) -
Other expenses (858) (338)
Profit before financing costs and income tax 31,538 4,432
Financing costs (2,472) (3,425)
Profit before income tax 29,066 1,007
Income tax expense 5 (9,852) (7,345)
Net profit / (loss) after tax for the period 19,214 (6,338)
Other comprehensive income
Items that may be reclassified subsequently to profit or loss:
Foreign currency translation differences - foreign operations (1,166) 5,671
Total other comprehensive income for the period (1,166) 5,671
Total comprehensive income for the period 18,049 (667)
Net earnings / (loss) per share Cents Cents
Basic earnings / (loss) per share (US cents per share) 1.64 (0.54)
Diluted earnings / (loss) per share (US cents per share) 1.60 (0.54)
The notes contained in the full version of the Half-Year Financial Report form
part of these consolidated financial statements, a copy of which is available
from the Company’s website: www.baseresources.com.au.
8. Consolidated Condensed Statement of Financial Position
31 December 2021 30 June 2021
Note US$000s US$000s
Current assets
Cash and cash equivalents 37,066 64,925
Trade and other receivables 6 40,852 62,635
Inventories 7 25,051 18,355
Other current assets 7,083 8,208
Total current assets 110,052 154,123
Non-current assets
Capitalised exploration and evaluation 8 160,012 157,909
Property, plant and equipment 9 90,362 104,917
Total non-current assets 250,374 262,826
Total assets 360,426 416,949
Current liabilities
Trade and other payables 15,717 21,618
Provisions 10 6,804 38,687
Income tax payable 123 -
Deferred revenue 11 1,500 -
Deferred consideration 7,000 7,000
Finance lease liabilities 155 41
Total current liabilities 31,299 88,259
Non-current liabilities
Provisions 10 13,235 15,088
Deferred tax liability 1,465 4,615
Deferred consideration 10,000 10,000
Finance lease liabilities 635 -
Total non-current liabilities 25,335 29,703
Total liabilities 56,634 97,049
Net assets 303,792 319,900
Equity
Issued capital 12 307,811 307,811
Treasury shares 13 (1,660) (2,273)
Reserves (15,828) (14,201)
Retained earnings 13,469 28,563
Total equity 303,792 319,900
The notes contained in the full version of the Half-Year Financial Report form
part of these consolidated financial statements, a copy of which is available
from the Company’s website: www.baseresources.com.au.
9. Consolidated Condensed Statement of Changes in Equity
Issued Retained earnings Share Foreign currency Treasury shares reserve Total
capital based payment reserve translation reserve
US$000s US$000s US$000s US$000s US$000s US$000s
Balance at 1 July 2020 307,063 72,898 5,038 (22,265) - 362,734
Loss for the period - (6,338) - - - (6,338)
Other comprehensive income - - - 5,671 - 5,671
Total comprehensive income for the period - (6,338) - 5,671 - (667)
Transactions with owners, recognised directly in equity
Dividends - (29,765) - - - (29,765)
Purchase of treasury shares - - - - (1,143) (1,143)
Share based payments 748 1,169 (1,238) - 448 1,127
Balance at 31 December 2020 307,811 37,964 3,800 (16,594) (695) 332,286
Balance at 1 July 2021 307,811 28,563 4,465 (18,666) (2,273) 319,900
Profit for the period - 19,214 - - 19,214
Other comprehensive income - - - (1,166) - (1,166)
Total comprehensive income for the period - 19,214 - (1,166) - 18,048
Transactions with owners, recognised directly in equity
Dividends - (34,838) - - - (34,838)
Purchase of treasury shares - - - - (537) (537)
Share based payments - 529 (460) - 1,150 1,219
Balance at 31 December 2021 307,811 13,469 4,005 (19,832) (1,660) 303,792
The notes contained in the full version of the Half-Year Financial Report form
part of these consolidated financial statements, a copy of which is available
from the Company’s website: www.baseresources.com.au.
10. Consolidated Condensed Statement of Cash Flows
6 months to 6 months to
31 December 2021 31 December 2020
US$000s US$000s
Cash flows from operating activities
Receipts from customers 115,276 85,283
Payments in the course of operations (77,522) (49,542)
Income tax paid (17,118) (4,644)
Net cash from operating activities 20,636 31,097
Cash flows from investing activities
Purchase of property, plant and equipment (6,806) (5,145)
Payments for exploration and evaluation (5,163) (7,812)
Other 93 128
Net cash used in investing activities (11,877) (12,829)
Cash flows from financing activities
Repayment of borrowings - (50,000)
Dividends paid (34,838) (29,765)
Purchase of treasury shares (537) (1,143)
Payments for debt service costs (55) (2,329)
Net cash used in financing activities (35,430) (83,237)
Net decrease in cash held (26,671) (64,969)
Cash at beginning of period 64,925 162,559
Effect of exchange fluctuations on cash held (1,188) 2,012
Cash at end of period 37,066 99,602
The notes contained in the full version of the Half-Year Financial Report form
part of these consolidated financial statements, a copy of which is available
from the Company’s website: www.baseresources.com.au.
FORWARD LOOKING STATEMENTS
Certain statements in or in connection with this release contain or comprise
forward looking statements. Such statements may include, but are not limited
to, statements with regard to capital cost, capacity, future production and
grades, sales projections and financial performance and may be (but are not
necessarily) identified by the use of phrases such as “will”,
“expect”, “anticipate”, “believe” and “envisage”. By their
nature, forward looking statements involve risk and uncertainty because they
relate to events and depend on circumstances that will occur in the future and
may be outside Base Resources’ control. Accordingly, results could differ
materially from those set out in the forward-looking statements as a result
of, among other factors, changes in economic and market conditions, success of
business and operating initiatives, changes in the regulatory environment and
other government actions, fluctuations in product prices and exchange rates
and business and operational risk management. Subject to any continuing
obligations under applicable law or relevant stock exchange listing rules,
Base Resources undertakes no obligation to update publicly or release any
revisions to these forward-looking statements to reflect events or
circumstances after today's date or to reflect the occurrence of unanticipated
events.
ENDS.
For further information contact:
James Fuller, Manager Communications and Investor Relations UK Media Relations
Base Resources Tavistock Communications
Tel: +61 (8) 9413 7426 Jos Simson and Gareth Tredway
Mobile: +61 (0) 488 093 763 Tel: +44 (0) 207 920 3150
Email: jfuller@baseresources.com.au
About Base Resources
Base Resources is an Australian based, African focused, mineral sands producer
and developer with a track record of project delivery and operational
performance. The Company operates the established Kwale Operations in Kenya
and is developing the Toliara Project in Madagascar. Base Resources is an
ASX and AIM listed company. Further details about Base Resources are
available at www.baseresources.com.au
PRINCIPAL & REGISTERED OFFICE
Level 3, 46 Colin Street
West Perth, Western Australia, 6005
Email: info@baseresources.com.au
Phone: +61 (0)8 9413 7400
Fax: +61 (0)8 9322 8912
NOMINATED ADVISOR
RFC Ambrian Limited
Stephen Allen
Phone: +61 (0)8 9480 2500
JOINT BROKER
Berenberg
Matthew Armitt / Detlir Elezi
Phone: +44 20 3207 7800
JOINT BROKER
Canaccord Genuity
Raj Khatri / James Asensio / Patrick Dolaghan
Phone: +44 20 7523 8000
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