REG - Centamin PLC - Interim Report
04/08/2022 07:15
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RNS Number : 8542U Centamin PLC 04 August 2022
4 August 2022
Centamin plc
("Centamin" or "the Company")
LSE: CEY / TSX: CEE
INTERIM report
for the six months ended 30 June 2022
MARTIN HORGAN, CEO, commented: "Centamin has delivered strong performance
against guidance and its long-term plans during the first half of the year. We
are now starting to see the benefit of the reinvestment programme as the
revised mine plan delivered improved production and costs during Q2 2022. The
waste stripping programme has enabled re-entry into the higher grade areas of
the open pit while the transition to owner operations in the underground
resulted in much improved productivity during Q2 2022. The new solar power
plant is expected to yield cost and decarbonisation benefits through H2 2022
and we also look forward to a strong pipeline of news that will highlight the
organic growth potential we see across our portfolio of assets. Alongside this
emerging growth, we remain committed to delivering shareholder returns and
today announce an interim dividend of 2.5 US cents per share."
HIGHLIGHTS
· Revenue for the six months ended 30 June 2022 ("H1 2022") was
US$382 million from gold sales of 203,587 ounces ("oz") at an average realised
gold price of US$1,872/oz
· Cash cost of production was US$931/oz produced, and all-in
sustaining costs ("AISC") were US$1,446/oz sold
· EBITDA was US$153 million with a 40% EBITDA margin
· Net profit after tax attributable to shareholders was US$85
million, for a basic EPS of 7.35 US cents
· Capital expenditure was US$139 million, including $6 million of
non-cash IFRS16 additions. Good progress was made on key capital projects such
as the solar plant, paste-fill plant and stages 2 and 3 Tailings Storage
Facility 2 ("TSF")
· Interim dividend of 2.5 US cents per share equating to a
distribution of approximately US$29 million, to be paid to shareholders on 7
October 2022
· Group operating cash flow totalled US$128 million and group free
cash flow of negative US$25 million reflects the investment in the future of
our operations with $133m cash investment in capex, as well as the US$33
million of profit share and royalty distributions to our partner, EMRA.
· Strong and flexible balance sheet with available cash and liquid
assets of US$175 million, as at 30 June 2022 and after payment of the 2021
final dividend of US$58 million on 15 June 2022
· We are continuing to promote diversity across our operations with
targets set for the mine in 2022 and beyond. Sukari recruited 11 women in
professional positions during H1 2022
OUTLOOK
Reaffirmed production and cost guidance for 2022 while investing for
operational consistency and growth
· Gold production of 430,000 to 460,000 oz for the year
· Cash costs of US$900-1,000/oz produced
· AISC of US$1,275-1,425/oz sold
· Given the current inflationary operating environment:
o We continue to monitor consumables pricing and review opportunities to
offset price increases with cost savings initiatives such as the solar power
plant; and
o We now anticipate cash costs and AISC for 2022 in the upper end of the
guidance range
· Capex budget of US$225.5 million
· Exploration expenditure for the year is expected to total US$25
million
Full Year 2022 Milestones & Targets
· Solar power plant commissioning - Q3 2022
· Capital structure review - Q3 2022
· Underground expansion study - Q3 2022
· Sukari Resource & Reserve update - Q4 2022
· Doropo Project (Côte d'Ivoire) pre-feasibility study - Q4 2022
GROUP FINANCIAL SUMMARY
Year on Year ("YoY") comparative
units H1 2022 H1 2021* %
Gold produced oz 203,898 204,275 (0)%
Gold sold oz 203,587 203,802 (0)%
Cash cost US$'000 189,856 164,774 15%
Unit cash cost US$/oz produced 931 807 15%
AISC US$'000 294,406 241,705 22%
Unit AISC US$/oz sold 1,446 1,186 22%
Average realised gold price US$/oz 1,872 1,799 4%
Revenue US$'000 381,786 367,404 4%
EBITDA US$'000 153,116 188,480 (19)%
Profit before tax US$'000 84,747 114,816 (26)%
Profit after tax attributable to the parent US$'000 84,737 59,484 42%
Basic EPS US cents 7.35 5.16 42%
Capital expenditure US$'000 138,687 78,312 77%
Operating cash flow US$'000 128,380 141,853 (9)%
Free cash flow US$'000 (25,246) 16,283 (255)%
* The 2021 comparative figures for EBITDA, Profit before tax, Operating cash
flow and Free cash flow have changed due to amounts
relating to discontinued operations in the Unaudited Interim Consolidated
Statement of Comprehensive Income and Unaudited Interim
Consolidated Statement of Cash Flows being reclassified.
WEBCAST PRESENTATION AND CONFERENCE CALL
The Company will host a webcast presentation and conference call today,
Thursday, 04 August 2022 at 09.30 BST to discuss the results, followed by
an opportunity to ask questions. The 2022 Interim Results presentation should
be taken in conjunction with this announcement and can be found on
the website: www.centamin.com/investors/presentations-webcasts/
(http://www.centamin.com/investors/presentations-webcasts/) .
A replay will be made available on the Company website.
Webcast link:https://www.investis-live.com/centamin/62bc44c5d9438014000fb454/ewer
(https://www.investis-live.com/centamin/62bc44c5d9438014000fb454/ewer)
Conference call dial-in telephone numbers:
United Kingdom +44 (0) 203 936 2999
United States +1 646 664 1960
South Africa +27 (0) 87 550 8441
All other locations +44 (0) 203 936 2999
Participation access code: 061531
PRINT-FRIENDLY VERSION of the half-year results:
www.centamin.com/investors/results-reports/
(http://www.centamin.com/investors/results-reports/)
FOR MORE INFORMATION
Please visit the website www.centamin.com (http://www.centamin.com) or
contact:
Centamin plc Buchanan
Michael Stoner, Group Corporate Manager Bobby Morse / Ariadna Peretz / George Cleary
investor@centaminplc.com (mailto:investor@centaminplc.com) + 44 (0) 20 7466 5000
centamin@buchanan.uk.com (mailto:centamin@buchanan.uk.com)
ENDNOTES
Guidance
The Company actively monitors the developments of the COVID-19 pandemic and
guidance may be impacted if the workforce or operation are disrupted.
Financials
Half year financial data points included within this report are unaudited.
Full year financial data points included within this report are audited.
Non-GAAP measures
This statement includes certain financial performance measures which are not
GAAP measures as defined under International Financial Reporting Standards
(IFRS). These include Cash costs of production, AISC, adjusted EBITDA, Cash
and liquid assets, and Free cash flow. Management believes these measures
provide valuable additional information for users of the financial statements
to understand the underlying trading performance. Definitions and explanation
of the measures used are detailed in the Company's 2021 Annual Report
https://www.centamin.com/investors/results-reports/
(https://www.centamin.com/investors/results-reports/) . Reconciliations to the
nearest IFRS measures are detailed within the Financial Review section of this
report.
Profit after tax attributable to the parent
Centamin profit after the profit share split with the Arab Republic of Egypt.
Royalties
Royalties are accrued and paid six months in arrears.
Cash and liquid assets
Cash and liquid assets include cash, bullion on hand and gold sales
receivables.
Movements in inventory
Movement in inventory on ounces produced is the movement in mining stockpiles
and ore in circuit while the movement in inventory on ounces sold is the net
movement in mining stockpiles, ore in circuit and gold in safe inventory.
Gold produced
Gold produced is gold poured and does not include gold in circuit at period
end.
Qualified Person
Information of a scientific or technical nature in this document was prepared
under the supervision of Craig Barker for the Sukari Underground drilling
results and Howard Bills for the surface exploration results. The Qualified
Persons are employees of the Company and are not independent of the issuer
applying the test set out in Section 1.5 of NI 43-101. Standards of
Disclosure for Mineral Projects of the Canadian Securities Administrators.
The Qualified Person has verified the data disclosed, including sampling,
analytical, and test data underlying the information or opinions contained in
this announcement in accordance with standards appropriate to their
qualifications.
Forward-looking Statements
This announcement (including information incorporated by reference) contains
"forward-looking statements" and "forward-looking information" under
applicable securities laws (collectively, "forward-looking statements"),
including statements with respect to future financial or operating
performance. Generally, these forward-looking statements can be identified by
the use of forward-looking terminology such as "believes", "expects",
"expected", "budgeted", "forecasts" and "anticipates" and other similar words.
Although Centamin believes that the expectations reflected in such
forward-looking statements are reasonable, Centamin can give no assurance that
such expectations will prove to be correct. Forward-looking statements are
prospective in nature and are not based on historical facts, but rather on
current expectations and projections of the management of Centamin about
future events and are therefore subject to known and unknown risks and
uncertainties which could cause actual results to differ materially from the
future results expressed or implied by the forward-looking statements. In
addition, there are a number of factors that could cause actual results,
performance, achievements or developments to differ materially from those
expressed or implied by such forward-looking statements; the risks and
uncertainties associated with the ongoing impacts of COVID-19 or other
pandemic, general business, economic, competitive, political and social
uncertainties; the results of exploration activities and feasibility studies;
assumptions in economic evaluations which prove to be inaccurate; currency
fluctuations; changes in project parameters; future prices of gold and other
metals; possible variations of ore grade or recovery rates; accidents, labour
disputes and other risks of the mining industry; climatic conditions;
political instability; decisions and regulatory changes enacted by
governmental authorities; delays in obtaining approvals or financing or
completing development or construction activities; and discovery of
archaeological ruins. 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 information or
statements, particularly in light of the current economic climate and the
significant volatility, uncertainty and disruption caused by COVID-19.
Forward-looking statements contained herein are made as of the date of this
announcement and the Company disclaims any obligation to update any
forward-looking statement, whether as a result of new information, future
events or results or except as required by law. Accordingly, readers should
not place undue reliance on forward-looking statements.
LEI: 213800PDI9G7OUKLPV84
Company No: 109180
TABLE OF CONTENTS
CEO'S REVIEW 5
FINANCIAL REVIEW 9
GOVERNANCE 17
PRINCIPAL RISKS AND UNCERTAINTIES 18
DIRECTORS' RESPONSIBILITY STATEMENT 19
INDEPENDENT REVIEW REPORT TO CENTAMIN PLC 21
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME 23
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION 24
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 25
UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS 26
NOTES TO THE UNAUDITED INTERIM CONDENSED FINANCIAL STATEMENTS 27
CEO's Review
(H1 2022 vs H1 2021)
I am pleased to deliver this positive update on the Company's activities over
the first half of 2022, a period that saw the continued operational delivery
against plan at the Sukari Gold Mine ("Sukari") and the simultaneous
advancement of numerous projects and work streams that will deliver the full
potential of Centamin's portfolio.
Sukari delivered a financial and operating performance in line with our plans
in H1 2022 with gold production of 203,898 ounces at an AISC of US$1,446/oz.
Production was in line with the corresponding six months in 2021 ("YoY") and
the AISC increased by 22% YoY. The production performance takes into account
the transition of the underground mining operations from contractor to owner
mining during the first quarter of the year while the cost performance is
reflective of the current global inflationary cost environment. Despite cost
pressures, the Company remains on track to achieve its annual cost and
production guidance for 2022 as a result of continued focus on compliance to
our operational plans and a strict adherence to cost control and mitigation
measures.
H1 2022 was a period of significant reinvestment in the Sukari mine with an
elevated level of capex during the period. As a number of studies and projects
move towards completion, we expect the capex to reduce through H2 2022 and
beyond. These projects underpin our confidence in the long-term potential of
Sukari.
Health Safety and Wellbeing
We remain focussed on the protection of our workforce and the local
communities that we work in. While the threat of the re-emergence of COVID
remains in the background and we maintain our vigilance, the focus in H1 2022
centred on our operational safety performance. We target a zero harm workplace
and over the first half of the year we unfortunately suffered a single Lost
Time Injury which has been investigated and corrective action plans issued as
a result of the review. Notwithstanding this incident, the Lost Time Injury
Frequency Rate ("LTIFR") was 0.16 per million hours worked, an 80% improvement
YoY and continues the trend of an improvement over the previous period and
leaves us on track to meet our annual improvement targets.
Geology
A comprehensive exploration update was published on 7 July 2022. A link to
"Group Exploration Update Confirming Growth Potential Across the Portfolio" is
available here
(https://tools.eurolandir.com/tools/Pressreleases/GetPressRelease/?ID=4133950&lang=en-GB&companycode=au-cey&v=)
: https://www.centamin.com/media/company-news/.
The geology team continued to explore the Sukari orebody, targeting extension
of the mineralisation in the underground with success in both the current
production areas of Amun and Ptah, and also depth extensions of the orebody in
the Horus zone. Building on last year's identification of the high grade
mineralisation in the Bast zone, further excellent drill results were achieved
which continue to support the zone's potential to provide significant high
grade gold production to supplement the existing working areas. Notable
drill results over the first half of the year included:
· Horus Deeps - 54m at 15.1g/t Au, including 3.8m at 161g/t Au and
2.15m at 44.84g/t Au
· Ptah - 23m at 7.2g/t Au, including 2m at 14.29g/t Au and 6m at
17.72g/t Au
· Amun - 17m at 9.6g/t Au, including 1m at 136g/t Au
· Amun - 8.5m at 7.6g/t Au, including 1m at 52.8g/t Au
· Bast - 10m at 64g/t Au, including 2m at 199g/t Au
· Bast - 4.5m at 267g/t Au, including 4m at 301.29g/t Au
· Bast - 17m at 12.5g/t Au, including 2.5m at 6.84g/t Au and 4m at
47.09g/t Au
During the second half of the year the team will complete the update of the
resource and reserve estimates for Sukari based on the drilling data up to and
including the 30 June 2022 with release of the results scheduled in late Q4
2022.
The surface exploration programme across the mining concession also returned
encouraging exploration results and continues to demonstrate the potential for
the development of smaller satellite pits that can provide both additional
reserves and offer improved operational flexibility to the open pit mining
operations. Notable drilling results from the exploration programme
included:
· Wadi Alam - 22m at 2.9g/t Au from 41m
· V Shear East 10m at 2.9g/t Au from 41m
Based on a combination of newly identified targets and a reassessment of
existing data on known targets, the surface exploration team will commence a
25km drilling programme across 6 targets in H2 2022 with the aim of developing
resources that can be converted to reserves and incorporated into the mine
plan at the earliest opportunity.
During April 2022 the Sukari team completed the first airborne geophysical
survey in Egypt, a significant step for Centamin and more broadly the emerging
Egyptian exploration and mining sector. The results of the survey over the
full mining concession area are currently under review and the findings from
this landmark initiative will be published in due course.
Production
The Sukari Management Team delivered a robust operational performance in H1
2022. The open pit has started to benefit from the previously announced waste
mining programme which commenced in early 2021. Operational flexibility is
returning and mining has recommenced in the Eastern zone of the pit providing
access to both higher grade ore and another working area to supplement the
northern and western areas of the pit. During the period some 40Mt of waste
were mined by our own fleet a 4% YoY increase which was driven by increasing
in truck productivity as a result of the introduction of the high capacity
truck trays and better fleet management optimisation. The waste mining
contractor also mined 19Mt of material during the period. Ore tonnes mined
were 6Mt at an average grade of 0.99g/t Au a 30% improvement in grade and 16%
decrease on tonnes YoY and reflects the availability of higher grade areas in
East and West of the pit plus an improvement in grade with depth in the north
zone.
The underground team successfully completed the transition from contract
mining to owner mining during the first quarter of 2022. After nearly 10
years of contractor mining, the team developed and executed a transition plan
that enabled them to deliver a strong second quarter with ore and development
tonnes increasing 50% quarter on quarter with an associated improvement in
grade of 33% to 4.74g/t. The focus for the balance of the year will be to
further bed down the operations and continue the productivity gains seen in Q2
2022, supported by the delivery of additional underground equipment to replace
and augment the current fleet.
The plant processed 6Mt of ore, a marginal increase YoY, at an average feed
grade of 1.22 g/t Au, a 4% increase YoY reflecting the improved grade of the
material mined over the period.
The metallurgical gold recovery rate was 88.2% for the half, in line with
budget however, a 1% reduction YoY, with the reduction resulting from a
planned mill reline and commissioning of certain process plant upgrades.
During the period, a series of process optimisation studies progressed with
the aim of improving overall plant performance including the assessment of
gravity gold recovery, floatation, and reagent dosing optimisation.
Human Resources
Employing a progressive approach to the management of the mine and our people,
we continue to develop our education and training programmes that seek to
identify, develop and promote Egyptian employees into leadership positions.
In 2020, we started developing the Centamin Capability Framework, this
includes succession planning and training needs analysis to ensure we are
attracting the best talent, developing the required skills and empowering the
workforce with the knowledge and tools to deliver operational excellence.
Several components of the Centamin Capability Framework were advanced in H1
2022 and included:
· Leadership Development Programme
· Employee Development Pathway
· Vocational Education & Training ("VET")
Under the Mobile Plant Apprenticeship Programme (which forms part of the VET)
all apprentices satisfactorily passed their units of competency for year 1.
This is a great outcome and I offer our congratulations to the students for
their hard work and success.
After the establishment of a Sukari Diversity Committee in 2021, I am
delighted to report that during the first half of the year Sukari recruited 11
women in professional positions across the mine site including the
administration, environmental and geology sections of the operations. This
is a first step and we will continue to promote gender diversity across our
operations with employment targets set for the mine in 2022 and beyond. This
approach has been completed in line with recent changes to the Egyptian labour
law that now permits a wider range of roles available to women in the mining
sector and we at Centamin are pleased to play our part in the development of
the broader Egyptian mining sector.
Projects and Optimisation Work
While maintaining our focus on operational discipline, we have simultaneously
continued to maximise the value of Sukari through the execution of a number of
projects and studies during the first half of the year in order to support our
goal of putting a world class mine around the world class Sukari orebody.
The 36MW Solar power plant made good progress during the period and
commissioning is planned for Q3 2022 bringing significant cost and carbon
emission benefits to the mine site. In parallel the Company has engaged in
discussions with the Egyptian authorities around the potential provision of
grid power to the mine based on the recent and significant expansion of the
national power generation capacity and distribution network. If successful,
this initiative offers potential to further reduce operating costs and carbon
emissions and we look forward to updating you in due course on this project.
The pastefill plant remains on schedule to be completed by year end and
commissioned during Q1 2023. The introduction of pastefill will play a key
role in further improving the performance of the underground through
maximising the safe extraction of the underground reserves and providing
productivity gains in the operations. In parallel, the underground expansion
study progressed well and we anticipate providing the initial findings of
study work in Q3 2022 as we seek to capitalise on the continued growth of the
underground resource base to both extend the underground mine life and
increase its annual production capacity.
ESG
I am pleased to report that the mine recorded zero reportable environment and
social incidents during the first half of 2022. However further work is
required to improve the site Environmental and Social Incident Frequency Rate
which is currently trending above target, albeit due to the reporting of minor
/ less severe category events.
The site's Environmental Management Plan was updated and will undergo further
revision to align strategy and objectives with the interim Life of Asset Plan.
Work has also commenced to update the Life of Mine Closure and Rehabilitation
Plan to support the development a strong legacy for the benefit of our local,
regional and national hosts.
Once fully commissioned in Q3, the solar plant will reduce our Scope 1 GHG
emissions by 60,000 tCO(2)-e per annum and help us achieve our short-term
target for emissions reduction. In addition to the option of grid connection,
we have initiated a broader analysis of decarbonisation options to support
establishment of science-based targets for carbon reduction by 2030 and one
that strives to algin with a pathway for net-zero emissions by 2050.
In respect of tailings management, work continued to bring our governance
processes and management systems in line with the Global Industry Standard on
Tailings Management ("GISTM") with the mapping and implementation of numerous
initiatives around roles and responsibilities, monitoring and evaluation and
assessing the Engineer of Record.
Growth & diversification
In parallel with the operational delivery at Sukari during H1 2022, we have
simultaneously advanced our exciting exploration portfolio in Egypt and Cote
d'Ivoire.
Eastern Desert Exploration (EDX), Egypt
After the finalisation and award of the exploration permits during early Q2
2022 and alongside the establishment of an exploration team in Marsa Alam,
field work commenced at our EDX portfolio initially focussing on the Nugrus
block adjacent to the Sukari Mining concession. Initial field work is
focussed on bulk leach extractable gold ("BLEG") sampling and mapping,
building on the extensive remote sensing work previously completed by the
team. At Nugrus, this preparatory work identified targets hosting in excess of
20km of strike extent of alluvial artisanal workings and over 300 hard rock
artisanal sites. Following the completion of the Nugrus Block work,
operations will move to the Um Rus and Najd blocks during H2 2022 with the aim
of identifying priority targets for drill testing at the soonest opportunity.
We continue to work with our industry partners to engage with government
around the exploitation terms for these newly awarded exploration licences.
Doropo Project, Côte d'Ivoire
Work progressed towards the delivery of the Doropo pre-feasibility study
("PFS") by the end of the year. The field programme has seen the completion of
in excess of 100,000 metres of drilling which is expected to convert the
majority of the Inferred Resource to the Indicated Resource category and
further identified resource growth potential of several of the Main Cluster
deposits. At the Kilosegui deposit, which is located 30km southwest of the
Main Cluster, the current 7km long Mineral Resource area is open along strike
in both directions and down dip.
Work towards the PFS is progressing with many of the major workstreams
complete or significantly advanced as described below:
· Mineral Resource and Reserve update - With infill drilling now
complete, the updated Mineral Resource estimates are currently in progress and
are expected to be completed during Q3 2022
· Plant design - Comminution test work and the process plant
front-end design has been completed
· Metallurgical drilling completed, with the metallurgical test
work programme underway
· Geotechnical drilling programme is now over 75% complete
· E&S baseline studies and stakeholder engagement to support
the evaluation of options for mine design, sequencing and site infrastructure.
The PFS is expected to be completed late in Q4 2022, which will be followed by
a formal decision to proceed with a definitive feasibility study ("DFS")
Stakeholder returns
Fundamental to Centamin's success, and delivery of our purpose to create
opportunities for people through mining, is the establishment of broad
socio-economic partnerships with our stakeholders, good governance, ethical
conduct, and transparency. Under the terms of the Sukari Concession Agreement,
the Arab Republic of Egypt received US$33 million in profit share and royalty
payments during the period. I am grateful for the open engagement and
collaborative partnership we've built with our Egyptian government partners.
Capital Structure Review
We are currently undertaking a capital structure review, assessing operational
cashflows across a range of operating scenarios, capital allocation
opportunities to support growth, our mix of cash and debt and the dividend
policy. The intention is to announce a capital allocation framework during Q3
2022, balancing both growth and sector leading shareholder returns on a
through the cycle basis.
Interim Dividend
For 2022, the Board reiterates its intention to recommend a minimum dividend
of 5.0 US cents per share for the full year. Today, the Board declares an
interim dividend of 2.5 US cents per share to be paid on 7 October 2022,
leaving an approximate minimum 2.5 US cents final dividend to be proposed with
the 2022 full year results. This reflects the Company's confidence in the
outlook for the year, and progress delivering on the reset plans.
OUTLOOK
The first half has seen a period of delivery in compliance with our plans. I'd
like to thank our employees and partners for their dedication to ensuring
business continuity. Thanks to these efforts, the Company is on track to
achieve full year production and cost guidance of 430-460 koz at an AISC in
the upper end of the US$1,275-1,425/oz range for 2022.
Centamin is an established long life, cash generative business which offers
sector leading dividend returns to shareholders, balanced with active
investment to drive future growth through a series of organic growth
opportunities in Egypt and West Africa. The Company has a strong balance sheet
with US$175 million of available cash and liquid assets as at 30 June 2022,
with no debt, hedging or streaming instruments, thereby offering shareholders
pure exposure to the gold price.
We look forward to delivering continued operational improvement and expect
strong progress with our capital projects and exploration programmes in the
second half.
Martin Horgan
CEO
4 August 2022
FINANCIAL REVIEW
(H1 2022 vs H1 2021)
The unaudited interim condensed consolidated financial statements have been
prepared in accordance with IAS 34 "Interim Financial Reporting" (IAS 34) as
adopted by the European Union and the requirements of the Disclosure and
Transparency Rule sourcebook (DTR) of the Financial Conduct Authority (FCA) in
the United Kingdom as applicable to interim financial reporting. The unaudited
interim condensed consolidated financial statements are not affected by
seasonality.
Certain numbers in the Unaudited Interim Condensed Consolidated Statement of
Comprehensive Income, Unaudited Interim Condensed Consolidated Statement of
Cash Flows, Non-GAAP Financial Measures and other note disclosures in both the
Financial Review section and the Unaudited Interim Condensed Consolidated
Financial Statements for the six months ended 30 June 2022 have been updated.
The update relates to the reversal of the held for sale/discontinued
operations classification of the Burkina Faso operations to align with the 31
December 2021 year end treatment. All the disclosures with such changes have
an asterisk (*) in the H1 2021 column.
Consolidated Statement of Comprehensive Income
H1 2022 H1 2021 (Unaudited) Full Year 2021
(Unaudited) (Audited)
Revenue US$'000 381,786 367,404 733,306
Revenue from gold and silver sales for the period increased by 4% YoY to
US$382 million (H1 2021: US$367 million), with a 4% increase in the average
realised gold sales price to US$1,872 per ounce (H1 2021: US$1,799 per ounce)
offset by a marginal decrease in gold sold to 203,587 ounces (H1 2021: 203,802
ounces).
H1 2022 H1 2021 (Unaudited) Full Year 2021
(Unaudited) (Audited)
Cost of sales US$'000 (257,436) (227,327) (487,376)
Cost of sales represents the cost of mining, processing, refining, transport,
site administration, depreciation, amortisation and movement in production
inventories. Cost of sales was up 13% YoY to US$257 million, mainly as a
result of:
· 6% increase in total mine production costs from US$181 million to
US$192 million (+ve), due to:
• a 33% increase in processing costs driven by increases in fuel
costs and other key processing consumables and reagents (+ve); partially
offset by
• a 8% decrease in open pit mining costs (-ve);
• a 33% decrease in underground costs driven by the transition
from a third-party contractor to owner operator model for underground mining
(-ve); and
• a 5% decrease in administration costs (-ve);
· 7% decrease in depreciation and amortisation charges YoY from
US$73 million to US$68 million (-ve) due to:
• Lower tonnage of open pit and underground ore mined in H1 2022
as compared to H1 2021. The open pit and underground ore mined tonnage drive
the unit of production depreciation and amortisation rates.
· Mining inventory increased by US$2 million over H1 2022 mainly
due to the increase in low grade ore stockpiles, which reduced cost of sales
by US$2 million, as these costs were capitalised to the balance sheet (-ve).
H1 2022 H1 2021 (Unaudited)* Full Year 2021
(Unaudited) (Audited)
Exploration and evaluation expenditure US$'000 (17,574) (4,849) (13,879)
Exploration and evaluation expenditure comprises expenditure incurred for
exploration activities in Côte d'Ivoire, Burkina Faso and Egypt (outside of
Sukari). Exploration and evaluation costs increased by US$13 million or 262%
YoY as more exploration and evaluation work, specifically drilling and
assaying at the two Côte d'Ivoire sites, continued into 2022. The new Egypt
exploration entities also commenced exploration activities in the current
period.
Consolidated Statement of Comprehensive Income (CONTINUED)
H1 2022 H1 2021 (Unaudited)* Full Year 2021
(Unaudited) (Audited)
Other operating costs US$'000 (24,736) (22,286) (49,100)
Other operating costs comprise expenditure incurred for communications,
consultants, directors' fees, stock exchange listing fees, share registry
fees, employee entitlements, general administration expenses and the 3%
royalty payable to the Arab Republic of Egypt ("ARE"). Other operating costs
increased by US$2 million or 11% YoY.
Adjusted EBITDA (note 1 under the Non-GAAP Financial Measures) was US$153
million, a decrease of 19% YoY, mostly driven by the 6% increase in cost of
sales and an increase in cash costs per ounce sold in the half year, partially
offset by the 4% increase in revenue. The adjusted EBITDA margin decreased by
11 percentage points, to 40%. Profit after tax was US$85 million, down 26%
YoY. Basic earnings per share was 7.35 US cents, an increase of 42% YoY.
H1 2022 H1 2021 (Unaudited) Full Year 2021
(Unaudited) (Audited)
Dividend paid - non-controlling interest in Sukari US$'000 (21,492) (45,700) (75,200)
Gold Mining Company (SGM) (being EMRA)
The profit share payments during the period are reconciled against SGM's
audited financial statements. Any variation between payments made during the
period (which are based on the Company's estimates) and the audited financial
statements, may result in a balance due and payable to EMRA or advances to be
offset against future distributions. SGM's 30 June 2022 financial statements
are currently being audited.
Refer to note 2.3 for details of the treatment and disclosure of the EMRA
profit share.
H1 2022 H1 2021 (Unaudited) Full Year 2021
(Unaudited) US cents per share (Audited)
US cents per share US cents per share
Earnings per share attributable to owners of the parent:
Basic (US cents per share) 7.35 5.16 8.81
Consolidated Statement of Financial Position
30 June 30 June 31 December 2021
2022 2021 (Audited)
(Unaudited) (Unaudited)
Current assets
Inventories - mining stockpiles and consumables US$'000 125,481 113,345 128,721
Trade and other receivables US$'000 28,777 32,820 32,579
Prepayments US$'000 13,095 10,200 7,964
Cash and cash equivalents US$'000 126,849 274,038 207,821
Assets classified as held for sale US$'000 - 36,977 -
Total current assets US$'000 294,202 467,380 377,085
Current assets have decreased by US$83 million or 22% from 31 December 2021
mainly as a result of:
· US$81 million decrease in net cash (net of foreign exchange
movements) (-ve) driven by lower cash generation in the period less the 2021
final dividend payment of US$58 million and a US$21 million payment to EMRA as
distributions to the NCI. The cash generated in the period also funded the
period's capital expenditure.
· US$5 million increase in prepayments, driven by an increase in
inventory suppliers paid in advance to lock in prices and minimise the risk of
operational disruptions from inventory shortages.
Consolidated Statement of Financial Position (Continued)
The Group has a strong and flexible balance sheet with no debt or hedging and
cash and liquid assets of US$175 million (31 December 2021: US$257 million).
Refer to note 3 under Non-GAAP Financial Measures below for details of this
non-GAAP measure.
30 June 30 June 31 December 2021
2022 2021 (Audited)
(Unaudited) (Unaudited)
Non‑current assets
Property, plant and equipment US$'000 1,026,494 828,115 956,217
Exploration and evaluation asset US$'000 25,261 35,629 25,261
Inventories - mining stockpiles US$'000 78,823 88,391 64,756
Other receivables US$'000 1,010 77 101
Total non‑current assets US$'000 1,131,588 952,212 1,046,335
Non-current assets have increased by US$85 million or 8% from 31 December 2021
mainly as a result of:
· US$70 million net increase in property, plant and equipment. This
included capitalised waste stripping costs, further lifts to the TSF 2, the
continued construction of the solar plant, the pastefill plant and continuous
process plant optimisation (total property, plant and equipment's net increase
in H1 2022 were at a cost of US$126 million) (+ve); and
· US$14 million increase in inventory related to mine Run of Mine
("ROM") stockpiles (+ve).
30 June 30 June 31 December 2021
2022 2021 (Audited)
(Unaudited) (Unaudited)
Current liabilities
Trade and other payables US$'000 71,039 54,703 75,759
Tax liabilities US$'000 237 219 253
Provisions US$'000 3,366 7,135 4,617
Liabilities directly associated with assets classified as held for sale US$'000 679 -
-
Total current liabilities US$'000 74,642 62,736 80,629
Current liabilities have decreased by US$6 million or 7% primarily as a result
of:
· A US$5 million lower balance owing to the group's trade creditors
in the current period as compared to 31 December 2021; partially offset by
30 June 30 June 31 December 2021
2022 2021 (Audited)
(Unaudited) (Unaudited)
Non-current liabilities
Provisions US$'000 42,973 30,408 42,647
Other payables US$'000 12,179 - 10,386
Total non-current liabilities US$'000 55,152 30,408 53,033
Non-current liabilities have increased by US$2 million from US$53 million at
31 December 2021 to US$55 million at 30 June 2022, mainly as a result of:
· US$5 million increase relating to the non-current capital lease
liabilities for the Groups' lease contracts; partially offset by
· US$3 million decrease related to the outstanding EMRA settlement
amount falling due within the next 12 months moving from non-current to
current.
Consolidated Statement of Cash Flows
H1 2022 H1 2021 (Unaudited)* Full Year 2021
(Unaudited) (Audited)
Cash flows from operating activities
Cash generated from operating activities US$'000 128,405 141,853 309,873
Income tax (paid)/received US$'000 (25) - 5
Net cash generated from operating activities US$'000 128,380 141,853 309,878
A stronger realised gold price combined with cost and capital allocation
management, offset by increased processing costs in the year, resulted in a 9%
YoY decrease in the net cash generated by operating activities to US$128
million.
H1 2022 H1 2021 (Unaudited)(*) Full Year 2021
(Unaudited) (Audited)
Cash flows from investing activities
Acquisition of property, plant and equipment US$'000 (128,665) (72,775) (224,929)
Brownfield exploration and evaluation expenditure US$'000 (3,683) (7,136) (15,943)
Finance income US$'000 214 41 196
Net cash used in investing activities US$'000 (132,134) (79,870) (240,676)
The current period saw a number of significant capital expenditure projects
being completed and others started. The capital expenditure in the period
included the spend on various capital projects, the largest being on waste
stripping activities capitalised of US$63 million, the solar plant of US$6
million, underground equipment and inventory of US$12 million, the underground
pastefill plant of US$8 million and further lifts to the new tailings dam of
US$3 million.
H1 2022 H1 2021 (Unaudited) Full Year 2021
(Unaudited) (Audited)
Cash flows from financing activities
Own shares acquired US$'000 (523) - (1,391)
Dividend paid - non-controlling interest in SGM US$'000 (21,492) (45,700) (75,200)
Dividend paid - owners of the parent US$'000 (57,740) (34,461) (80,517)
Net cash used in financing activities US$'000 (79,755) (80,161) (157,108)
After distribution of profit share payments to the Company's partner, EMRA 1
(#_ftn1) , the Group generated negative free cash flow (note 4 under the
non-GAAP Financial Measures) of US$25 million, down 255% YoY mainly driven by
increased capital expenditure and higher costs partially offset by a higher
realised gold price in the period.
Profit share payments of US$21 million, down 53% YoY, and royalties of US$12
million, up 6% YoY, were earned in H1 2022. Under the terms of the Concession
Agreement with EMRA, on 1 July 2020, the profit share mechanism changed to
50:50, from 55:45 in favour of Centamin, and will remain at this level for the
remainder of the tenure.
EMRA audits of the cost recovery model for the 10 years to 30 June 2020 were
completed and final profit share positions were calculated for that period,
with outstanding certain amounts due to both partners being settled in H1
2022. This process and related settlements resulted in the profit share
amounts not being 50:50 in the six month period to 30 June 2022. Since June
2020, Centamin has also invested US$108 million into SGM for various specific
capital projects, including the solar plant, pastefill plant, accommodation,
ongoing rebuild capital expenditure and exploration expenditure. This
investment will be recovered in future periods from SGM (as per the terms of
the Concession Agreement), pending the finalisation and sign off of the
respective EMRA audits.
Capital expenditure
The following table provides a breakdown of the total capital expenditure of
the Group:
H1 2022 H1 2021 (Unaudited) Full Year 2021
(Unaudited) (Audited)
Underground exploration US$'000 1,729 6,416 13,741
Underground mine development US$'000 16,965 17,891 34,900
Other sustaining capital expenditure US$'000 59,501 30,969 57,513
Total sustaining capital expenditure US$'000 78,195 55,276 106,154
Non-sustaining exploration expenditure US$'000 1,954 720 2,202
Other non-sustaining capital expenditure((1)) US$'000 58,537 22,316 132,516
Total gross capital expenditure US$'000 138,686 78,312 240,872
(1) Non-sustaining capital expenditure included the construction of TSF 2,
underground paste fill plant, the Capital waste stripping contract and the
construction of the solar plant. Non-sustaining costs are primarily those
costs incurred at 'new operations' and costs related to 'major projects at
existing operations' that will materially benefit the operation.
The Group has contractual commitments for capital expenditure for the
remainder of the year amounting to US$34 million.
Exploration expenditure
The following table provides a breakdown of the total exploration expenditure
of the Group:
H1 2022 H1 2021 (Unaudited) Full Year 2021
(Unaudited) (Audited)
Greenfield exploration
Côte d'Ivoire US$'000 15,386 2,933 11,499
Egypt - Exploration US$'000 500 - -
Burkina Faso((1)) US$'000 1,688 1,916 2,380
Total greenfield exploration expenditure US$'000 17,574 4,849 13,879
Brownfield exploration
Egypt - Mining US$'000 3,683 7,136 15,943
Total brownfield exploration expenditure US$'000 3,683 7,136 15,943
Total exploration expenditure US$'000 21,257 11,985 29,822
(1) The recurrent expenditure in Burkina Faso relates to ongoing
administration costs.
Exploration and evaluation assets - impairment considerations
In consideration of the requirements of the International Financial Reporting
Standards ("IFRS") 6 Exploration for and Evaluation of Mineral Resources, an
impairment trigger assessment has been performed on the Sukari Exploration and
Evaluation assets. On review, no impairment triggers were identified as at 30
June 2022.
SUBSEQUENT EVENTS
The Directors have declared an interim dividend of 2.5 US cents per share on
Centamin plc ordinary shares (totalling approximately US$29 million). The
interim dividend for the half year period ended 30 June 2022 will be paid on 7
October 2022 to shareholders on the register on the Record Date of 2 September
2022.
Other than the above, there were no other significant events occurring after
the reporting date requiring disclosure in the financial statements.
Non‑GAAP financial measures
Summarised definitions of the non‑GAAP financial measures used in this
report are provided below, for the full definitions and explanations for the
measures used, see the financial review section of the 2021 Annual Report.
1. EBITDA and adjusted EBITDA
EBITDA is a non‑GAAP financial measure, which excludes the following from
profit before tax:
· Finance costs
· Finance income
· Depreciation and amortisation.
Reconciliation of profit for the period before tax to EBITDA and adjusted
EBITDA:
H1 2022 H1 2021 (Unaudited)* Full Year 2021
(Unaudited) (Audited)
Profit for the period before tax US$'000 84,747 114,816 153,647
Finance income US$'000 (214) (41) (196)
Interest expense US$'000 529 257 486
Depreciation and amortisation US$'000 68,054 73,448 139,455
EBITDA US$'000 153,116 188,480 293,392
Add back/(less):((1))
Impairments of non-current assets((2)) US$'000 - - 35,208
Adjusted EBITDA((3)) US$'000 153,116 188,480 328,600
(1) Adjustments made to normalise earnings, for example impairments of
property, plant and equipment, non-current mining stockpiles and exploration
and evaluation assets.
(2) The impairment charge relates to the write-off of the Burkina Faso
exploration and evaluation asset recognised as at 31 December 2021. Refer to
the 2021 Annual Report for more explanatory detail.
(3) Adjusted EBITDA is the EBITDA adjusted for specific items (not
exhaustive list) in (2) above and other similar items.
2. Cash cost of production per ounce produced and sold and all-in
sustaining costs ("AISC") per ounce sold calculation
Cash cost of production and AISC are non-GAAP financial measures. Cash cost of
production per ounce is a measure of the average cost of producing an ounce of
gold, calculated by dividing the operating costs in a period by the total gold
production over the same period. Operating costs represent total operating
costs less sustaining administrative expenses, royalties, depreciation and
amortisation.
Reconciliation of cash cost of production per ounce produced:
H1 2022 H1 2021 (Unaudited) Full Year 2021
(Unaudited) (Audited)
Mine production costs (note 2.2) US$'000 192,090 180,714 368,327
Less: Refinery and transport US$'000 (1,126) (1,145) (2,264)
Movement of inventory((1)) US$'000 (1,108) (14,795) (6,195)
Cash cost of production - gold produced US$'000 189,856 164,774 359,868
Gold produced - total (oz.) oz 203,898 204,275 415,370
Cash cost of production per ounce produced US$/oz 931 807 866
(1) The movement in inventory on ounces produced is only the movement in
mining stockpiles and ore in circuit while the movement in ounces sold is the
net movement in mining stockpiles, ore in circuit and gold in safe inventory.
Group cash costs of production were US$931 per ounce produced, up 15% YoY,
predominantly due to a 6% increase in mine production costs. Gold ounces
produced were in line with the prior period.
A reconciliation has been included below to show the cash cost of production
metric should gold sold ounces be used as a denominator.
Non‑GAAP financial measures (CONTINUED)
Reconciliation of cash cost of production per ounce sold:
H1 2022 H1 2021 (Unaudited) Full Year 2021
(Unaudited) (Audited)
Mine production costs (note 2.2) US$'000 192,090 180,714 368,327
Royalties US$'000 11,679 10,988 21,672
Movement of inventory((1)) US$'000 1,078 (15,401) (15,081)
Cash cost of production - gold sold US$'000 204,847 176,301 374,918
Gold sold - total (oz.) oz 203,587 203,802 407,252
Cash cost of production per ounce sold US$/oz 1,006 865 921
(1) The movement in inventory on ounces produced is only the movement in
mining stockpiles and ore in circuit while the movement in ounces sold is the
net movement in mining stockpiles, ore in circuit and gold in safe inventory.
H1 2022 H1 2021 (Unaudited) Full Year 2021
(Unaudited) (Audited)
Movement in inventory
Movement in inventory - cash (above) US$'000 1,078 (15,401) (15,081)
Effect of depreciation and amortisation - non-cash US$'000 1,341 (11,205) 35,049
Movement in inventory - cash & non-cash (note 2.2) US$'000 2,419 (26,606) 19,968
Reconciliation of AISC per ounce sold:
H1 2022 H1 2021 (Unaudited) Full Year 2021
(Unaudited) (Audited)
Mine production costs (note 2.2) US$'000 192,090 180,714 368,327
Movement in inventory US$'000 1,078 (15,401) (15,081)
Royalties US$'000 11,679 10,988 21,672
Corporate costs (note 2.2) US$'000 11,780 10,709 22,379
Rehabilitation costs US$'000 294 138 276
Sustaining underground development and exploration US$'000 18,694 24,307 48,641
Other sustaining capital expenditure US$'000 59,501 30,969 57,513
By‑product credit US$'000 (711) (719) (1,361)
All‑in sustaining costs((1)) US$'000 294,405 241,705 502,366
Gold sold - total (oz.) oz 203,587 203,802 407,252
AISC per ounce sold US$/oz 1,446 1,186 1,234
(1) Includes refinery and transport.
Non‑GAAP financial measures (CONTINUED)
3. Cash and cash equivalents, bullion on hand and gold and silver
sales debtor
Cash and cash equivalents, bullion on hand and gold and silver sales debtor is
a non-GAAP financial measure. Cash and cash equivalents, bullion on hand and
gold and silver sales debtor is a measure of the available cash and liquid
assets at a point in time.
Reconciliation to cash and cash equivalents, bullion on hand and gold and
silver sales debtor:
30 June 30 June 31 December 2021
2022 2021 (Audited)
(Unaudited) (Unaudited)
Cash and cash equivalents (note 2.9(a)) US$'000 126,849 274,047 207,821
Bullion on hand (valued at the period-end spot price) US$'000 20,830 6,190 20,304
Gold and silver sales debtor US$'000 27,761 31,905 29,147
Cash and cash equivalents, bullion on hand and gold and silver sales debtor US$'000 312,142 257,272
175,440
4. Free cash flow and adjusted free cash flow
Free cash flow is a non-GAAP financial measure. Free cash flow is a measure of
the available cash after distributions to the Non-Controlling Interest ("NCI")
in SGM, being EMRA, that the Group has at its disposal to use for capital
reinvestment and to distribute to shareholders of the parent as dividends in
accordance with the Company's dividend policy.
H1 2022 H1 2021 (Unaudited)* Full Year 2021
(Unaudited) (Audited)
Net cash generated from operating activities US$'000 128,380 141,853 309,878
Less:
Net cash used in investing activities US$'000 (132,134) (79,870) (240,676)
Dividend paid - non-controlling interest in SGM US$'000 (21,492) (45,700) (75,200)
Free cash flow US$'000 (25,246) 16,283 (5,998)
Add back:
Net (disposals)/acquisitions of financial assets at fair value through profit US$'000 - -
or loss((1))
-
Adjusted free cash flow((2)) US$'000 (25,246) 16,283 (5,998)
1) Adjustments made to free cash flow, for example acquisitions and
disposals of financial assets at fair value through profit or loss, cash paid
for restructuring and repositioning, which are completed through specific
allocated available cash reserves.
2) Adjusted free cash flow is the free cash flow amount adjusted for
specific items (not exhaustive list) in (1) above and other similar items.
governanCe
Share Plan Awards
Granted 20 May 2022
· The Company granted 9,042,000 performance share awards over
ordinary shares of nil par value to certain directors and 32 employees of the
Group under the Company's shareholder approved Incentive Share Plan.
Performance conditions and further details of the scheme can be found in the
2021 Annual Report (www.centamin.com (http://www.centamin.com) ).
· The Company granted 2,010,000 restricted share awards over
ordinary shares of nil par value to 84 employees under the Company's
shareholder approved Incentive Share Plan. These shares vest annually over a
three-year period in equal tranches to participants, subject to the scheme
rules and the employee remaining with the Company.
Legal developments in egypt
There have been no material developments in the current period. For further
detail please refer to Note 5.1 of the 2021 Annual Report on the Company's
website.
PRINCIPAL RISKS AND Uncertainties
RISK MANAGEMENT
Centamin recognises that nothing is without risk. A successful and sustainable
business needs a robust and proactive risk management framework as its
foundation, which outlines the Company's approach and process for management
of risk. The framework should be supported by a strong culture of risk
awareness that encourages openness and integrity, alongside a clearly defined
appetite for risk. This enables the Board to consider risks and opportunities
to improve our decision-making process, deliver on our objectives and improve
our performance as a responsible mining company. The Board has overall
responsibility for establishing a framework that allows for the review of
existing and emerging risks in the context of both opportunities and potential
threats that informs the principal risks and uncertainties. These risks inform
the assessment of the future prospects and long-term viability of the Group.
These risks are also considered when challenging the three pillars of the
Company that underpin the strategy.
The 2021 Annual Report included updates to the principal risks driven by the
revised strategy for the business and external factors such as greater
understanding of the potential impact of climate change. A 'new' principal
risk, Decarbonisation, was elevated from the climate change emerging risk. The
existing principal and emerging risks were refreshed to reflect the broader
considerations of the business moving forward to align with the robust
foundation for growth and yield which has been set as we invest for the
future.
We continue to feel the ongoing global impact of the COVID-19 pandemic and the
ongoing conflict in the Ukraine. This is bringing increased financial
pressures which we continue to monitor. The Financial Emerging Risk reflects
the current understanding of the challenges which this presents due to
inflationary pressures, when also considering the healthy financial position
of the business, additional measures such as the focus on cost savings
initiatives and other areas we are exploring means this is not considered a
Principal Risk. We are aware of the impact that the macro-economic factors may
have in increasing the potential of social unrest within our countries of
operation and will continue to monitor this and work with our stakeholders to
manage this where possible.
Recognising the importance of climate change as a growing global risk and in
particular due to the nature of our business the need to address
decarbonisation will be an ongoing focus.
The Directors confirm that a robust assessment of the principal, new and
emerging risks impacting the Company has been undertaken which identified
external, strategic and operational risks on a sliding scale depending on the
level of influence over which the Company may have on the factors which can
impact the risk. For further detail please refer to the Risk Review within the
2021 Annual Report and 2021 Sustainability Report, published on the Company's
website: www.centamin.com.
PRINCIPAL RISKS
The principal risks and uncertainties facing the Group remain unchanged from
those which are set out in detail within the Strategic Report section of the
2021 Annual Report. The principal risks are listed below:
External risks
• Political
• Legal and Regulatory Compliance
• Litigation
• Infectious Disease Management
• Gold Price
Strategic risks
• Single Project Dependency
• Concession Governance and Management
• Licence to Operate
• Future of our Workforce
• Stakeholder Environmental and Social Expectations
• Decarbonisation
Operational risks
• Safety, Health and Wellbeing
• Exploration
• Geological Understanding
• Operational Performance and Planning
EMERGING RISKS
Below we have outlined a list of emerging risks, these remain unchanged from
those which are set out within the Strategic Report section of the 2021 Annual
Report:
• Financial
• Cyber security
• Corporate development
• Security - CDI
• Capital allocation and project execution
________________________________________________________________________________________________
DIRECTORS' RESPONSIBILITY STATEMENT
RESPONSIBILITY STATEMENT OF THE DIRECTORS IN RESPECT OF THE SIX MONTHS ENDED
30 JUNE 2022 FINANCIAL REPORT
The directors confirm that to the best of their knowledge:
a) the condensed set of interim consolidated financial statements for
the six months ended 30 June 2022 has been prepared in accordance with
International Accounting Standard 34 'Interim Financial Reporting' as adopted
by the European Union;
b) the condensed set of interim consolidated financial statements, which
has been prepared in accordance with the applicable set of accounting
standards, gives a true and fair view of the assets, liabilities, financial
position and profit or loss of the issuer, or the undertakings included in the
consolidation as a whole as required by DTR 4.2.4;
c) the interim management report includes a fair review of the
information required by DTR 4.2.7R (indication of important events during the
first six months and description of principal risks and uncertainties for the
remaining six months of the year); and
d) the interim management report includes a fair review of the
information required by DTR 4.2.8R (disclosure of related parties'
transactions and changes therein).
The board of directors that served during all or part of the six month period
ended on 30 June 2022 and their respective responsibilities can be found on
pages 88 to 160 of the 2021 annual report of Centamin plc.
By order of the Board,
Chief Executive
Officer
Chief Financial Officer
Martin
Horgan
Ross Jerrard
4 August
2022
4 August 2022
UNAUDITED INTERIM CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED
30 JUNE 2022
Independent review report to Centamin plc
Report on the condensed consolidated interim financial statements
Our conclusion
We have reviewed Centamin plc's condensed consolidated interim financial
statements (the "interim financial statements") in the interim report of
Centamin plc for the 6 month period ended 30 June 2022 (the "period").
Based on our review, nothing has come to our attention that causes us to
believe that the interim financial statements are not prepared, in all
material respects, in accordance with International Accounting Standard 34,
'Interim Financial Reporting' as adopted by the European Union and the
Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's
Financial Conduct Authority.
The interim financial statements comprise:
· the unaudited interim condensed consolidated statement of financial
position as at 30 June 2022;
· the unaudited interim condensed consolidated statement of
comprehensive income for the period then ended;
· the unaudited interim condensed consolidated statement of changes in
equity for the period then ended;
· the unaudited interim condensed consolidated statement of changes in
cash flows for the period then ended; and
· the explanatory notes to the interim financial statements.
The interim financial statements included in the interim report of Centamin
plc have been prepared in accordance with International Accounting Standard
34, 'Interim Financial Reporting' as adopted by the European Union and the
Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's
Financial Conduct Authority.
Basis for conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410, 'Review of Interim Financial Information Performed by
the Independent Auditor of the Entity' issued by the Financial Reporting
Council for use in the United Kingdom. A review of interim financial
information consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures.
A review is substantially less in scope than an audit conducted in accordance
with International Standards on Auditing (UK) and, consequently, does not
enable us to obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do not express
an audit opinion.
We have read the other information contained in the interim report and
considered whether it contains any apparent misstatements or material
inconsistencies with the information in the interim financial statements.
Conclusions relating to going concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for conclusion section of this report,
nothing has come to our attention to suggest that the directors have
inappropriately adopted the going concern basis of accounting or that the
directors have identified material uncertainties relating to going concern
that are not appropriately disclosed. This conclusion is based on the review
procedures performed in accordance with this ISRE. However, future events or
conditions may cause the group to cease to continue as a going concern.
Responsibilities for the interim financial statements and the review
Our responsibilities and those of the directors
The interim report, including the interim financial statements, is the
responsibility of, and has been approved by the directors. The directors are
responsible for preparing the interim report in accordance with the Disclosure
Guidance and Transparency Rules sourcebook of the United Kingdom's Financial
Conduct Authority. In preparing the interim report, including the interim
financial statements, the directors are responsible for assessing the group's
ability to continue as a going concern, disclosing, as applicable, matters
related to going concern and using the going concern basis of accounting
unless the directors either intend to liquidate the group or to cease
operations, or have no realistic alternative but to do so.
Our responsibility is to express a conclusion on the interim financial
statements in the interim report based on our review. Our conclusion,
including our Conclusions relating to going concern, is based on procedures
that are less extensive than audit procedures, as described in the Basis for
conclusion paragraph of this report. This report, including the conclusion,
has been prepared for and only for the company for the purpose of complying
with the Disclosure Guidance and Transparency Rules sourcebook of the United
Kingdom's Financial Conduct Authority and for no other purpose. We do not, in
giving this conclusion, accept or assume responsibility for any other purpose
or to any other person to whom this report is shown or into whose hands it may
come save where expressly agreed by our prior consent in writing.
PricewaterhouseCoopers LLP
Chartered Accountants
London
4 August 2022
Unaudited interim condensed consolidated statement of comprehensive income
for the six months ended 30 June 2022
Half year ended Half year ended 30 June Year ended
30 June 31 December
2022 2021 (Unaudited)* 2021
(Unaudited) (Audited)
Notes US$'000 US$'000 US$'000
Revenue 2.1 381,786 367,404 733,306
Cost of sales 2.2 (257,436) (227,327) (487,376)
Gross profit 124,350 140,077 245,930
Exploration and evaluation expenditure (17,574) (4,849) (13,879)
Other operating costs 2.2 (24,736) (22,286) (49,100)
Other income 2,493 1,833 5,708
Finance income 2.2 214 41 196
Impairment of exploration and evaluation asset 2.5 - - (35,208)
Profit for the period before tax 84,747 114,816 153,647
Tax (10) 48 20
Profit for the period after tax 84,737 114,864 153,667
Profit for the period after tax attributable to:
- the owners of the parent 84,737 59,484 101,527
- non-controlling interest in SGM 2.3 - 55,380 52,140
Total comprehensive income for the period 84,737 114,864 153,667
Total comprehensive income for the period attributable to:
- the owners of the parent 84,737 59,484 101,527
- non-controlling interest in SGM 2.3 - 55,380 52,140
Earnings per share attributable to owners of the parent:
Basic (US cents per share) 7.352 5.160 8.811
Diluted (US cents per share) 7.277 5.118 8.738
( )
* The 2021 comparative figures for Exploration and evaluation expenditure,
Other operating costs and Other income have changed due
to amounts relating to discontinued operations being reclassified.
The above unaudited interim condensed consolidated statement of comprehensive
income should be read in conjunction with the accompanying notes.
Unaudited interim CONDENSED consolidated STATEMENT OF Financial position
as at 30 June 2022
30 June 30 June 31 December
2022 2021 2021
(Unaudited) (Unaudited) (Audited)
Notes US$'000 US$'000 US$'000
Non‑current assets
Property, plant and equipment 2.4 1,026,494 828,115 956,217
Exploration and evaluation asset 2.5 25,261 35,629 25,261
Inventories - mining stockpiles 78,823 88,391 64,756
Other receivables 1,010 77 101
Total non‑current assets 1,131,588 952,212 1,046,335
Current assets
Inventories - mining stockpiles and consumables 125,481 113,345 128,721
Trade and other receivables 28,777 32,820 32,579
Prepayments 13,095 10,200 7,964
Cash and cash equivalents 2.9(a) 126,849 274,038 207,821
Assets classified as held for sale 2.6 - 36,977 -
Total current assets 294,202 467,380 377,085
Total assets 1,425,790 1,419,592 1,423,420
Non‑current liabilities
Provisions 2.7 42,973 30,408 42,647
Other payables 2.8 12,179 - 10,386
Total non‑current liabilities 55,152 30,408 53,033
Current liabilities
Trade and other payables 2.8 71,039 54,703 75,759
Tax liabilities 237 219 253
Provisions 2.7 3,366 7,135 4,617
Liabilities directly associated with assets classified as held for sale 2.6 - 679 -
Total current liabilities 74,642 62,736 80,629
Total liabilities 129,794 93,144 133,662
Net assets 1,295,996 1,326,448 1,289,758
Equity
Issued capital 670,994 670,830 669,531
Share option reserve 4,245 3,613 4,975
Accumulated profits 682,505 659,521 655,508
Total equity attributable to:
- owners of the parent 1,357,744 1,333,964 1,330,014
- non-controlling interest in SGM (61,748) (7,516) (40,256)
Total equity 1,295,996 1,326,448 1,289,758
The above unaudited interim condensed consolidated statement of financial
position should be read in conjunction with the accompanying notes.
The unaudited interim condensed consolidated financial statements were
authorised by the Board of Directors for issue on 4 August 2022 and signed on
its behalf by:
Martin
Horgan
Ross Jerrard
Chief Executive
Officer
Chief Financial Officer
Director
Director
4 August
2022
4 August 2022
Unaudited interim condensed consolidated statement of changes in equity
for the six months ended 30 June 2022
Issued capital (Unaudited) Share option reserve (Unaudited) Accumulated profits (Unaudited) Total (Unaudited) Non-controlling interests (Unaudited) Total
equity (Unaudited)
Notes US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Balance as at 1 January 2022 669,531 4,975 655,508 1,330,014 (40,256) 1,289,758
Profit for the period after tax - - 84,737 84,737 - 84,737
Total comprehensive income for the period - -
84,737 84,737 - 84,737
Own shares acquired (523) - - (523) - (523)
Net recognition of share-based payments
- 1,256 - 1,256 - 1,256
Transfer of share-based payments
1,986 (1,986) - - - -
Dividend paid - non-controlling interest in SGM 2.3
- - - - (21,492) (21,492)
Dividend paid - owners of the parent
- - (57,740) (57,740) - (57,740)
Balance as at 30 June 2022 670,994 4,245 682,505 1,357,744 (61,748) 1,295,996
Issued capital (Unaudited) Share option reserve (Unaudited) Accumulated profits (Unaudited) Total (Unaudited) Non-controlling interests (Unaudited) Total
equity (Unaudited)
Notes US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Balance as at 1 January 2021 668,807 3,343 634,498 1,306,648 (17,196) 1,289,452
Profit for the period after tax - - 59,484 59,484 55,380 114,864
Total comprehensive income for the period - - 59,484 59,484 55,380 114,864
Net recognition of share-based payments - 2,293 - 2,293 - 2,293
Transfer of share-based payments 2,023 (2,023) - - - -
Dividend paid - non-controlling interest in SGM 2.3 - - - - (45,700) (45,700)
Dividend paid - owners of the parent - - (34,461) (34,461) - (34,461)
Balance as at 30 June 2021 670,830 3,613 659,521 1,333,964 (7,516) 1,326,448
Issued capital (Audited) Share option reserve (Audited) Accumulated profits (Audited) Total (Audited) Non-controlling interests (Audited) Total
equity (Audited)
Notes US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Balance as at 1 January 2021 668,807 3,343 634,498 1,306,648 (17,196) 1,289,452
Profit for the year after tax - - 101,527 101,527 52,140 153,667
Total comprehensive income for the year
- - 101,527 101,527 52,140 153,667
Own shares acquired (1,391) - - (1,391) - (1,391)
Net recognition of share-based payments
- 3,747 - 3,747 - 3,747
Transfer of share-based payments
2,115 (2,115) - - - -
Dividend paid - non-controlling interest in SGM 2.3
- - - - (75,200) (75,200)
Dividend paid - owners of the parent
- - (80,517) (80,517) - (80,517)
Balance as at 31 December 2021
669,531 4,975 655,508 1,330,014 (40,256) 1,289,758
The above unaudited interim condensed consolidated statement of changes in
equity should be read in conjunction with the accompanying notes.
unaudited interim condensed consolidated statement of cash flows
for the six months ended 30 June 2022
Half year ended 30 June Half year ended 30 June Year ended
31 December
2022 (Unaudited) 2021 2021
(Unaudited)* (Audited)
Notes US$'000 US$'000 US$'000
Cash flows from operating activities
Cash generated from operating activities 2.9(b) 128,405 141,853 309,873
Income tax (paid)/received (25) - 5
Net cash generated from operating activities 128,380 141,853 309,878
Cash flows from investing activities
Acquisition of property, plant and equipment (128,665) (72,775) (224,929)
Brownfield exploration and evaluation expenditure (3,683) (7,136) (15,943)
Finance income 2.2 214 41 196
Net cash used in investing activities (132,134) (79,870) (240,676)
Cash flows from financing activities
Own shares acquired (523) - (1,391)
Dividend paid - non-controlling interest in SGM 2.3 (21,492) (45,700) (75,200)
Dividend paid - owners of the parent (57,740) (34,461) (80,517)
Net cash used in financing activities (79,755) (80,161) (157,108)
Net decrease in cash and cash equivalents (83,509) (18,178) (87,906)
Cash and cash equivalents at the beginning of the period 207,821 291,281 291,281
Effect of foreign exchange rate changes 2,537 944 4,446
Cash and cash equivalents at the end of the period 2.9(a) 126,849 274,047 207,821
( )
* The 2021 comparative figures for Cash generated from operating activities,
Acquisition of property, plant and equipment have changed
due to amounts relating to discontinued operations being reclassified.
The above unaudited interim condensed consolidated statement of cash flows
should be read in conjunction with the accompanying notes.
notes to the unaudited interim condensed consolidated financial statements
for the six months ended 30 June 2022
Current reporting period amendments
1.1 Changes in critical judgements and estimates in applying the
entities accounting policies
There were no updates and/or changes to critical accounting judgements and
estimates that management have made in the period in applying the Group's
accounting policies, that have a significant effect on the amounts recognised
and the disclosure of such amounts in the financial statements. Refer to the
2021 Annual Report for applicable critical accounting judgements or estimates.
1.2 Changes in policies and estimates
There were no changes in policies and estimates during the reporting period.
1.3 Standards not affecting the reported results or the financial
position
There are no standards that are not yet effective and that would be expected
to have a material impact on the entity in the current or future reporting
periods and on foreseeable future transactions.
2 How numbers are calculated
2.1 Segment reporting
The Group is engaged in the business of exploration for and mining of precious
metals, which represents three operating segments, two in the business of
exploration and one in mining of precious metals. The Board is the Group's
chief operating decision-maker within the meaning of IFRS 8 'Operating
segments'. Management has determined the operating segments based on the
information reviewed by the Board for the purposes of allocating resources and
assessing performance.
The Board considers the business from a geographic perspective and a mining of
precious metals versus exploration for precious metals perspective.
Geographically, management considers separately the performance in Egypt,
Burkina Faso, Côte d'Ivoire and Corporate (which includes Jersey, United
Kingdom and Australia). From a mining of precious metals versus exploration
for precious metals perspective, management separately considers the Egyptian
mining of precious metals from the Egyptian and West African exploration for
precious metals in these geographies. The Egyptian mining operations derive
its revenue from the sale of gold while the West African and recently
incorporated Egyptian entities are currently only engaged in precious metal
exploration and do not produce any revenue.
The Board assesses the performance of the operating segments based on profits
and expenditure incurred as well as exploration expenditure in each region.
Egypt is the only operating segment, with one of its entities, SGM mining
precious metals and therefore has revenue and cost of sales whilst the
remaining operating segments do not. All operating segments are reviewed by
the Board as presented and are key to the monitoring of ongoing performance
and assessing plans of the Company.
Non‑current assets other than financial instruments by country:
30 June 30 June 31 December
2022 (Unaudited) 2021 2021
(Unaudited)* (Audited)
US$'000 US$'000 US$'000
Egypt - Mining 1,128,559 951,048 1,044,543
Egypt - Exploration 1,132 - -
Burkina Faso 468 - 526
Côte d'Ivoire 873 381 596
Corporate 556 783 670
Total non-current assets 1,131,588 952,212 1,046,335
Additions to non-current assets mainly relate to Egypt and are disclosed in
note 2.4.
notes to the unaudited interim condensed consolidated financial statements
for the six months ended 30 June 2022
2.1 Segment reporting (continued)
Statement of financial position by operating segment:
30 June 2022 Egypt Exploration
Total Egypt Mining Burkina Faso Côte d'Ivoire Corporate
(Unaudited) US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Statement of financial position
Total assets 1,425,790 1,344,491 2,864 1,575 2,579 74,281
Total liabilities (129,794) (127,285) (669) (1,319) (1,733) 1,212
Net assets/total equity 1,295,996 1,217,206 2,195 256 846 75,493
30 June 2021 Egypt Exploration
Total Egypt Mining Burkina Faso Côte d'Ivoire Corporate
(Unaudited) US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Statement of financial position
Total assets 1,382,614 1,114,665 - - 695 267,254
Total liabilities (92,464) (91,232) - - (169) (1,063)
Net assets/total equity 1,290,150 1,023,433 - - 526 266,191
Asset held for sale
Total assets 36,977 - - 36,974 - 3
Total liabilities (679) - - (669) - (10)
Net assets/total equity 36,298 - - 36,305 - (7)
Net assets/total equity 1,326,448 1,023,433 - 36,305 526 266,184
31 December 2021
Egypt Exploration
Total Egypt Mining Burkina Faso Côte d'Ivoire Corporate
(Audited) US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Statement of financial position
Total assets 1,423,420 1,228,758 935 1,724 1,650 190,353
Total liabilities (133,662) (129,762) - (368) (829) (2,703)
Net assets/total equity 1,289,758 1,098,996 935 1,356 821 187,650
Statement of comprehensive income by operating segment:
Half year ended 30 June 2022 Egypt Mining Egypt Exploration Burkina Faso Côte d'Ivoire
Total Corporate
(Unaudited) US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Statement of comprehensive income
Gold sales 381,075 381,075 - - - -
Silver sales 711 711 - - - -
Revenue 381,786 381,786 - - - -
Cost of sales (257,436) (257,436) - - - -
Gross profit 124,350 124,350 - - - -
Exploration and evaluation costs (17,574) - (500) (1,688) (15,386) -
Other operating costs (24,736) (14,773) (37) (69) (181) (9,676)
Other income 2,493 3,902 97 (10) (544) (952)
Finance income 214 (2) - - - 216
Profit/(loss) for the period before tax 84,747 113,477 (440) (1,767) (16,111) (10,412)
Tax (10) (10) - - - -
Profit/(loss) for the period after tax 84,737 113,467 (440) (1,767) (16,111) (10,412)
Profit/(loss) for the period after tax attributable to:
- owners of the parent ((1)) 84,737 113,467 (440) (1,767) (16,111) (10,412)
- non-controlling interest in SGM ((1)) - - - - - -
(1) Please note that the cost recovery model on which profit share is based
under the Concession Agreement is different to the accounting results
presented above due to various adjustments and as such the share of profit
disclosed above is not reflective of the 55%:45% split that was in place from
1 July 2018 to 30 June 2020 and 50%:50% split from 1 July 2020 onwards that
occurs in practice, refer to the statement of cash flows by operating segment
below for further information.
notes to the unaudited interim condensed consolidated financial statements
for the six months ended 30 June 2022
2.1 Segment reporting (continued)
Statement of comprehensive income by operating segment:
Half year ended 30 June 2021 Egypt Exploration
Total Egypt Mining Burkina Faso Côte d'Ivoire Corporate
(Unaudited)* US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Statement of comprehensive income
Gold sales 366,685 366,685 - - - -
Silver sales 719 719 - - - -
Revenue 367,404 367,404 - - - -
Cost of sales (227,327) (227,327) - - - -
Gross profit 140,077 140,077 - - - -
Exploration and evaluation costs (4,849) - - (1,916) (2,933) -
Other operating (costs)/income (22,286) (3,280) - 32 (108) (18,930)
Other income 1,833 2,688 - (86) (58) (711)
Finance income 41 (14) - - - 55
Profit/(loss) for the period before tax 114,816 139,471 - (1,970) (3,099) (19,586)
Tax 48 48 - - - -
Profit/(loss) for the period after tax 116,864 139,519 - (1,970) (3,099) (19,586)
Profit/(loss) for the period after tax attributable to:
- owners of the parent ((1)) 59,484 84,139 - (1,970) (3,099) (19,586)
- non-controlling interest in SGM ((1)) 55,380 55,380 - - - -
* The figures for Exploration and evaluation costs, Other operating costs and
Other income have changed due to amounts relating to
discontinued operations being reclassified.
(1) Please note that the cost recovery model on which profit share is based
under the Concession Agreement is different to the accounting results
presented above due to various adjustments and as such the share of profit
disclosed above is not reflective of the 55%:45% split that was in place from
1 July 2018 to 30 June 2020 and 50%:50% split from 1 July 2020 onwards that
occurs in practice, refer to the statement of cash flows by operating segment
below for further information.
Year ended 31 December 2021
Egypt Mining Egypt Exploration
Total Burkina Faso Côte d'Ivoire Corporate
(Audited) US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Statement of comprehensive income
Gold sales 731,945 731,945 - - - -
Silver sales 1,361 1,361 - - - -
Revenue 733,306 733,306 - - - -
Cost of sales (487,376) (487,376) - - - -
Gross profit 245,930 245,930 - - - -
Exploration and evaluation costs (13,879) - - (2,380) (11,499) -
Other operating (costs)/income (49,100) (15,756) - (21) (247) (33,076)
Other income 5,708 6,922 - (105) (238) (871)
Finance income 196 (1) - - - 197
Impairment of exploration and evaluation asset (35,208) - - (35,208) - -
Profit/(loss) for the year before tax 153,647 237,095 - (37,714) (11,984) (33,750)
Tax 20 20 - - - -
Profit/(loss) for the year after tax 153,667 237,115 (37,714) (11,984) (33,750)
Profit/(loss) for the year after tax attributable to:
- owners of the parent ((1)) 101,527 184,975 - (37,714) (11,984) (33,750)
- non-controlling interest in SGM ((1)) 52,140 52,140 - - - -
(1) Please note that the cost recovery model on which profit share is based
under the Concession Agreement is different to the accounting results
presented above due to various adjustments and as such the share of profit
disclosed above is not reflective of the 55%:45% split that was in place from
1 July 2018 to 30 June 2020 and 50%:50% split from 1 July 2020 onwards that
occurs in practice, refer to the statement of cash flows by operating segment
below for further information.
( )
All gold and silver sales during the period were made to a single customer in
North America, Asahi Refining Canada Ltd.
notes to the unaudited interim condensed consolidated financial statements
for the six months ended 30 June 2022
2.1 Segment reporting (continued)
Statement of cash flows by operating segment:
Half year ended 30 June 2022 Egypt Mining Egypt Exploration Burkina Faso Côte d'Ivoire Corporate
Total
(Unaudited) US$'000 US$'000 US$'000 US$'000((1)) US$'000((1)) US$'000((1))
Statement of cash flows
Net cash generated from/(used in) operating activities 128,380 180,879 1,297 15 638 (54,449)
Net cash (used in)/generated from investing activities (132,134) (130,764) (1,148) - (436) 214
Net cash (used in)/generated from financing activities
Own shares acquired (523) - - - - (523)
Dividend paid - non-controlling interest in SGM (21,492) (21,492) - - - -
Dividend paid - controlling interest in SGM (31,754) (31,754) - - - -
Dividend received - controlling interest in SGM 31,754 31,754 - - - -
Dividend paid - owners of the parent (57,740) - - - - (57,740)
Net (decrease)/increase in cash and cash equivalents (83,509) 28,623 149 15 202 (112,498)
Cash and cash equivalents at the beginning of the period ((2))
207,821 13,609 935 5 859 192,413
Effect of foreign exchange rate changes 2,537 4,789 114 (16) (449) (1,901)
Cash and cash equivalents at the end of the period 126,849 47,021 1,198 4 612 78,014
(1) Please note that the cash generated by operating activities for
Burkina Faso and Cote d'Ivoire are affected by the movements in working
capital, specifically intercompany loans, with its direct parent entity
Centamin West Africa Holdings Limited which is included within the corporate
segment.
(2) The PGM cash balance has been included in the Egypt Mining operating
segment in the interim report to 30 June 2022 and in Corporate in prior year.
Half year ended 30 June 2021 Egypt Mining Egypt Exploration Burkina Faso Côte d'Ivoire
Total Corporate
(Unaudited)* US$'000 US$'000 US$'000 US$'000((1)) US$'000((1)) US$'000((1))
Statement of cash flows
Net cash generated from/(used in) operating activities 141,853 160,627 - 89 (320) (18,543)
Net cash (used in)/generated from investing activities (79,870) (79,924) - (1) - 55
Net cash (used in)/generated from financing activities
Dividend paid - non-controlling interest in SGM (45,700) (45,700) - - - -
Dividend (paid)/received - controlling interest in SGM - (45,700) - - - 45,700
Dividend paid - owners of the parent (34,461) - - - - (34,461)
Net (decrease)/increase in cash and cash equivalents (18,178) (10,697) - 88 (320) (7,249)
Cash and cash equivalents at the beginning of the period 291,281 9,893 5 456 280,927
-
Effect of foreign exchange rate changes 944 6,010 - (86) (44) (4,936)
Cash and cash equivalents at the end of the period 274,047 5,206 - 7 92 268,742
* The figures for Cash generated from operating activities, Acquisition
of property, plant and equipment have changed due to amounts relating to
discontinued operations being reclassified.
(1) Please note that the cash generated by operating activities for
Burkina Faso and Cote d'Ivoire are affected by the movements in working
capital, specifically intercompany loans, with its direct parent entity
Centamin West Africa Holdings Limited which is included within the corporate
segment.
Year ended 31 December 2021 Total Egypt Mining Egypt Exploration Burkina Faso Côte d'Ivoire Corporate
(Audited) US$'000 US$'000 US$'000 US$'000((1)) US$'000((1)) US$'000((1))
Statement of cash flows
Net cash generated from/(used in) operating activities 309,878 372,972 887 200 901 (65,082)
Net cash (used in)/generated from investing activities (240,676) (241,250) - (1) (308) 883
Net cash used in financing activities
Own shares acquired (1,391) - - - - (1,391)
Dividend paid - non-controlling interest in SGM (75,200) (75,200) - - - -
Dividend (paid)/received - controlling interest in SGM - (75,200) - - - 75,200
Dividend paid - owners of the parent (80,517) - - - - (80,517)
Net (decrease)/increase in cash and cash equivalents (87,906) (18,678) 887 199 593 (70,907)
Cash and cash equivalents at the beginning of the year 291,281 9,892 - 5 456 280,928
Effect of foreign exchange rate changes 4,446 15,139 48 (199) (190) (10,352)
Cash and cash equivalents at the end of the year 207,821 6,353 935 5 859 199,669
(1) Please note that the cash generated by operating activities for
Burkina Faso and Cote d'Ivoire are affected by the movements in working
capital, specifically intercompany loans, with its direct parent entity
Centamin West Africa Holdings Limited which is included within the corporate
segment.
notes to the unaudited interim condensed consolidated financial statements
for the six months ended 30 June 2022
2.1 Segment reporting (continued)
Exploration expenditure by operating segment
The following table provides a breakdown of the total exploration expenditure
of the Group by operating segment:
Half year ended Half year ended Year ended
30 June 30 June 31 December
2022 2021 2021
(Unaudited) (Unaudited) (Audited)
US$'000 US$'000 US$'000
Cote d'Ivoire 15,386 2.933 11,499
Egypt - Exploration 500 - -
Burkina Faso 1,688 1,916 2,380
Exploration expenditure - greenfield 17,574 4,849 13,879
Egypt - Mining 3,683 7,136 15,943
Exploration expenditure - brownfield 3,683 7,136 15,943
Total exploration expenditure 21,257 11,985 29,822
2.2 Profit before tax
Profit for the period has been arrived at after crediting/(charging) the
following gains/(losses) and income/(expenses):
Half year ended 30 June Half year ended Year ended
30 June 31 December
2022 (Unaudited) 2021 2021
(Unaudited)* (Audited)
US$'000 US$'000 US$'000
Other income
Net foreign exchange gains 2,452 1,808 5,158
Other income 41 25 550
2,493 1,833 5,708
Finance income
Interest received 214 41 196
Expenses
Cost of sales
Mine production costs (192,090) (180,714) (368,327)
Movement in inventory 2,419 26,606 19,968
Depreciation and amortisation (67,765) (73,219) (139,017)
(257,436) (227,327) (487,376)
Other operating costs
Corporate compliance (1,320) (1,314) (2,698)
Fees payable to the external auditors (493) (522) (856)
Corporate consultants (1,378) (1,089) (1,914)
Salaries and wages (6,677) (4,678) (10,094)
Employee equity settled share-based payments (1,256) (2,293) (3,747)
Other administration expenses (656) (813) (3,070)
Corporate costs (sub-total) (11,780) (10,709) (22,379)
Other provisions (32) 2 (731)
Net movement on provision for stock obsolescence - - (3,135)
Other non-corporate operating expenses (590) (244) (511)
Royalty - attributable to the ARE government (11,679) (10,988) (21,672)
Bank charges (126) (90) (186)
Finance charges (529) (257) (486)
(24,736) (22,286) (49,100)
notes to the unaudited interim condensed consolidated financial statements
for the six months ended 30 June 2022
2.3 Non-controlling interest in SGM
EMRA is a 50% shareholder in SGM and is entitled to a share of 50% of SGM's
net production surplus which can be defined as 'revenue less payment of the
fixed royalty to the ARE and recoverable costs'.
Earnings attributable to the non-controlling interest in SGM (i.e., EMRA) are
pursuant to the provisions of the CA and are recognised as profit attributable
to the non-controlling interest in SGM in the attribution of profit section of
the statement of comprehensive income of the Group. The profit share payments
during the year will be reconciled against SGM's audited financial statements.
The SGM financial statements for the year ended 30 June 2022 have not been
signed off at the date of this report and are in the process of being audited.
Certain terms of the CA and amounts in the cost recovery model may also vary
depending on interpretation and management and the Board making various
judgements and estimates that can affect the amounts recognised in the
financial statements.
a) Statement of comprehensive income and statement of financial
position impact
Half year ended 30 June Half year ended Year ended
30 June 31 December
2022 (Unaudited) 2021 2021
(Unaudited) (Audited)
US$'000 US$'000 US$'000
Statement of comprehensive income
Profit for the period after tax attributable to the non-controlling interest - 55,380 52,140
in SGM((1))
Statement of financial position
Total equity attributable to the non-controlling interest in SGM((1)) (40,256) (17,196) (17,196)
(opening)
Profit for the period after tax attributable to the non-controlling interest - 55,380 52,140
in SGM((1))
Dividend paid - non-controlling interest in SGM (21,492) (45,700) (75,200)
Total equity attributable to the non-controlling interest in SGM((1)) (61,748) (7,516) (40,256)
(closing)
(1) Profit share commenced during the third quarter of 2016. The first two
years was a 60:40 split of net production surplus to PGM and EMRA
respectively. From 1 July 2018 this changed to a 55:45 split for the next
two-year period until 30 June 2020, after which all net production surpluses
will be split 50:50.
Any variation between payments made during the year (which are based on the
Company's estimates) and the SGM audited financial statements, may result in a
balance due and payable to EMRA or advances to be offset against future
distributions. This will be reflected as an amount attributable to the NCI in
SGM on the statement of financial position and statement of changes in equity.
b) Statement of cash flow impact
Half year ended 30 June Half year ended Year ended
30 June 31 December
2022 (Unaudited) 2021 2021
(Unaudited) (Audited)
US$'000 US$'000 US$'000
Statement of cash flows
Dividend paid - non-controlling interest in SGM((1)) (21,492) (45,700) (75,200)
(1) Profit share commenced during the third quarter of 2016. The first two
years was a 60:40 split of net production surplus to PGM and EMRA
respectively. From 1 July 2018 this changed to a 55:45 split for the next
two-year period until 30 June 2020, after which all net production surpluses
will be split 50:50.
EMRA and PGM benefit from advance distributions of profit share which are made
on a weekly or fortnightly basis and proportionately in accordance with the
terms of the CA. Future distributions will take into account ongoing cash
flows, historical costs that are still to be recovered and any future capital
expenditure. All profit share payments will be reconciled against SGM's
audited June financial statements for current and future periods.
notes to the unaudited interim condensed consolidated financial statements
for the six months ended 30 June 2022
2.4 Property, plant and equipment
Mine Capital
Half year ended 30 June Office Plant and Mining development work in
2021 (Unaudited) equipment Buildings equipment equipment properties progress Total
US$'000 US$'000 US$'000 US$'000 US$'000 US$'000 US$'000
Cost
Balance at 1 January 2022 9,243 13,823 625,077 359,467 816,224 85,003 1,908,837
Additions 57 1,041 89 226 - 127,252 128,665
Additions: IFRS16 right of use assets - 1,616 1,204 3,518 - - 6,338
Transfers from capital work in progress 409 2,909 5,606 27,788 79,528 (116,240) -
Transfer from exploration and evaluation asset - - - - 3,683 - 3,683
Disposals (1,349) - (1,394) (8,266) - - (11,009)
Disposals: IFRS16 right of use assets - (1,073) - (139) - - (1,212)
Balance at 30 June 2022 8,360 18,316 630,582 382,594 899,435 96,015 2,035,302
Accumulated depreciation and amortisation
Balance at 1 January 2022 (7,543) (3,026) (275,640) (288,323) (378,088) - (952,620)
Depreciation and amortisation (410) (1,058) (17,045) (20,731) (28,810) - (68,054)
Disposals 1,349 1,073 1,037 8,407 - - 11,866
Balance at 30 June 2022 (6,604) (3,011) (291,648) (300,647) (406,898) - (1,008,808)
Year ended 31 December 2021 (Audited)
Cost
Balance at 1 January 2021 8,792 5,690 617,465 359,009 662,496 44,554 1,698,006
Additions 11 - 54 231 - 224,633 224,929
Increase in rehabilitation asset - - - - 21,875 - 21,875
Transfers from capital work in progress 1,127 8,489 7,848 54,042 112,678 (184,184) -
Transfers from exploration and evaluation asset - - - - 19,175 - 19,175
Disposals (687) (5) (290) (53,673) - - (54,655)
Disposals: IFRS16 right of use assets - (351) - (142) - - (493)
Balance at 31 December 2021 9,243 13,823 625,077 359,467 816,224 85,003 1,908,837
Accumulated depreciation and amortisation
Balance at 1 January 2021 (7,542) (1,641) (242,853) (298,572) (317,514) - (868,122)
Depreciation and amortisation (688) (1,597) (33,077) (43,518) (60,574) - (139,454)
Disposals 687 212 290 53,769 - - 54,958
Balance at 31 December 2021 (7,543) (3,026) (275,640) (288,323) (378,088) - (952,620)
Net book value
As at 31 December 2021 1,700 10,797 349,437 71,144 438,136 85,003 956,217
As at 30 June 2022 1,756 15,305 338,934 81,947 492,537 96,015 1,026,494
The Group has contractual commitments for capital expenditure for the
remainder of the year amounting to US$34 million.
Included within the depreciation charge for the period in relation to ROU
assets is US$0.3 million for the buildings asset class and US$0.4 million
related to plant and equipment (2021: US$0.3 million buildings and US$0.0
million plant and equipment).
Deferred stripping assets of US$63 million (2021: US$59 million) were
recognised in the six month period ended 30 June 2022, which have been
included in mine development properties, US$10 million (2021: US$10 million)
of amortisation has been recognised in the same period.
An impairment trigger assessment was performed in 2021 on the Sukari Cash
Generating Unit ("CGU"), refer to note 1.3.2 of the 2021 Annual Report,
however no impairment triggers were identified in the assessment. An update
assessment was performed as at 30 June 2022 and no impairment triggers were
identified.
Assets that have been cost recovered under the terms of the CA in Egypt are
included on the statement of financial position under property, plant and
equipment due to the Company having right of use of these assets. These rights
will expire together with the CA.
notes to the unaudited interim condensed consolidated financial statements
for the six months ended 30 June 2022
2.5 Exploration and evaluation asset
30 June 30 June 31 December
2022 2021 2021
(Unaudited) (Unaudited) (Audited)
US$'000 US$'000 US$'000
Balance at the beginning of the year 25,261 63,701 63,701
Expenditure for the period 3,683 7,136 15,943
Transfer to property, plant and equipment (3,683) - (19,175)
Transfer to assets classified as held for sale (Note 2.6) - (35,208) -
Impairment charge on exploration and evaluation asset - - (35,208)
Balance at end of the period 25,261 35,629 25,261
The exploration and evaluation asset relates to the drilling, geological
exploration and sampling of potential ore reserves and can all be attributed
to Egypt (US$25.3 million)
In accordance with the requirements of IAS 36 'Impairment of Assets' and IFRS
6 'Exploration for and evaluation of mineral resources' exploration assets are
assessed for impairment when facts and circumstances (as defined in IFRS 6
'Exploration for and evaluation of mineral resources') suggest that the
carrying amount of exploration and evaluation asses may exceed its recoverable
amount.
An impairment trigger assessment was performed as at 30 June 2022 on the
exploration and evaluation assets and no impairment triggers were identified.
2.6 Assets and liabilities of disposal group classified as held for sale
The following assets and liabilities were classified as held for sale in
relation to the discontinued operation as at 30 June 2021.
30 June 30 June 31 December
2022 2021 2021
(Unaudited) (Unaudited) (Audited)
US$'000 US$'000 US$'000
Assets classified as held for sale
Property, plant and equipment - 505 -
Exploration and evaluation asset - 35,208 -
Inventories - 11 -
Trade and other receivables - 1,160 -
Prepayments - 84 -
Cash and cash equivalents - 9 -
Total assets of disposal group held for sale - 36,977 -
Liabilities directly associated with assets classified as held for sale
Trade and other payables - 248 -
Provision - 431 -
Total liabilities of a disposal group held for sale - 679 -
Subsequent to the held for sale classification as at 30 June 2021, at year
end, management considered all the possible scenarios and outcomes with
respect to the Burkina Faso project and concluded that it is highly unlikely
that the licence will be renewed and therefore were of the opinion that it
will no longer be able to sell the asset within 12 months of the year end.
Accordingly, the assets and related liabilities were no longer classified as
an asset held for sale and were transferred back to their original categories
on the consolidated statement of financial position.
Based on the circumstances and events as outlined in the 2021 annual report,
management determined that as at 31 December 2021, there was an impairment
trigger under IFRS 6, and subsequently assessed that the asset in Burkina Faso
was fully impaired as at that date. The value of the exploration and
evaluation asset was subsequently impaired in full in the statement of
comprehensive income.
notes to the unaudited interim condensed consolidated financial statements
for the six months ended 30 June 2022
2.7 Provisions
30 June 30 June 31 December
2022 2021 2021
(Unaudited) (Unaudited) (Audited)
US$'000 US$'000 US$'000
Current
Employee benefits((1)) 1,981 162 2,798
Provision for cost recovery items(2) - 4,570 -
Other current provisions((3)) 1,385 2,831 1,819
Transfer to liabilities directly associated with assets classified as held for - (428) -
sale
3,366 7,135 4,617
Non‑current
Restoration and rehabilitation((4)) 42,941 20,634 42,647
Provision for cost recovery items(2) - 9,753 -
Other non-current provisions 32 24 -
Transfer to liabilities directly associated with assets classified as held for - (3) -
sale
42,973 30,408 42,647
Movement in restoration and rehabilitation provision
Balance at beginning of the year 42,647 20,496 20,496
Additional provision recognised - - 21,875
Interest expense - unwinding of discount 294 138 276
Balance at end of the period 42,941 20,634 42,647
(1) Employee benefits relate to annual, sick and long service leave
entitlements and bonuses.
(2) Provision was held for in-country cost recovery items relating
to EMRA, the amount is based on the written offer proposed to EMRA in March
2021 to settle all outstanding matters which includes payment of US$17.6
million spread over a 5.5 year period. The recognised amount was discounted to
present value. The 2021 amount was reclassified to other liabilities
(accruals) as the timing and amounts payable was now certain due to a
settlement agreement having been signed with EMRA, refer to note 2.12 in the
2021 Annual Report.
(3) Provision for customs, rebates and withholding taxes.
(4) The provision for restoration and rehabilitation was discounted
(as at 31 December 2021) by 1.38% using a US$ applicable rate and inflation
applied at 2.5% . The annual review undertaken as at 31 December 2021 resulted
in a US$21.9 million increase in the provision. The next annual review of the
provision for restoration and rehabilitation will be undertaken as at 31
December 2022.
For prior year key management estimates regarding the unit costs used in
calculating the nominal provision amount, please refer to note 1.3.9 in the
2021 Annual Report.
2.8 Trade and other payables
30 June 30 June 31 December
2022 2021 2021
(Unaudited) (Unaudited) (Audited)
US$'000 US$'000 US$'000
Non-Current
Other creditors((1)) 12,179 - 10,386
12,179 - 10,386
Current
Trade payables 30,914 28,264 36,050
Other creditors and accruals(1) 40,125 26,687 39,709
Transfer to liabilities directly associated with assets classified as held for - (248) -
sale
71,039 54,703 75,759
(1) A lower total trade and other payables balance due to less trade creditors
in the current period as compared to 31 December 2021. Also included within
non-current other creditors are lease liabilities of US$5 million for the
group.
notes to the unaudited interim condensed consolidated financial statements
for the six months ended 30 June 2022
2.9 Cash flow information
(a) Reconciliation of cash and cash equivalents
For the purpose of the statement of cash flows, cash and cash equivalents
includes cash on hand and at bank and deposits.
30 June 30 June 31 December
2022 2021 2021
(Unaudited) (Unaudited) (Audited)
US$'000 US$'000 US$'000
Cash and cash equivalents - per statement of cash flows 126,849 274,047 207,821
Transfer to assets classified as held for sale - (9) -
Cash and cash equivalents - per statement of financial position 126,849 274,038 207,821
(b) Reconciliation of profit for the year to cash flows from operating
activities
Half year ended Half year ended Year ended 31 December
30 June 30 June
2022 2021 2021
(Unaudited) (Unaudited)* (Audited)
US$'000 US$'000 US$'000
Profit for the period before tax 84,747 114,816 153,647
Adjusted for:
Impairment of exploration and evaluation asset - - 35,208
Depreciation/amortisation of property, plant and equipment 68,054 73,448 139,454
Inventory written off - 14 21
Inventory obsolescence provision - - 3,135
Foreign exchange gains, net (2,452) (1,808) (5,158)
Share‑based payments expense 1,256 2,293 3,747
Finance income (214) (41) (196)
Loss on disposal of property, plant and equipment 301 1 53
Changes in working capital during the period:
(Increase)/decrease in trade and other receivables 3,801 (15,556) (14,155)
Increase in inventories (10,828) (18,171) (13,036)
Decrease/(increase) in prepayments (6,040) (1,351) 946
(Decrease)/increase in trade and other payables (9,263) (9,537) 8,823
(Decrease) in provisions (957) (2,255) (2,616)
Cash flows generated from operating activities 128,405 141,853 309,873
* The figures for Profit for the period before tax, some adjustments and
some lines in the changes in working capital during the period
have changed due to amounts relating to discontinued operations being
reclassified.
(c) Non‑cash financing and investing activities
During the period there have been no non‑cash financing and investing
activities.
3 Unrecognised items
3.1 Contingent liabilities
Concession Agreement court case
There have been no significant changes in the period ended 30 June 2022, for
further information and disclosure on this matter please refer to the 31
December 2021 Annual Report.
3.2 Subsequent events
The Directors declared an interim dividend of 2.5 US cents per share on
Centamin plc ordinary shares (totalling approximately US$29 million). The
interim dividend for the half year period ended 30 June 2022 will be paid on 7
October 2022 to shareholders on the register on the Record Date of 2 September
2022.
Other than the above, there were no other significant events occurring after
the reporting date requiring disclosure in the financial statements.
notes to the unaudited interim condensed consolidated financial statements
for the six months ended 30 June 2022
Other information
4.1 Contributions to Egypt
Gold sales agreement
On 20 December 2016, SGM entered into a contract with the Central Bank of
Egypt ("CBE"). The agreement provides that the parties may elect, on a monthly
basis, for the CBE to supply SGM with its local Egyptian currency requirements
for that month to a maximum value of EGP80 million (2021: EGP80 million). In
return, SGM facilitates the purchase of refined gold bullion for the CBE from
SGM's refiner, Asahi Refining Canada Ltd. This transaction has been entered as
SGM requires local currency for its operations in Egypt (it receives its
revenue for gold sales in US dollars). 51 transactions have been entered into
at the date of this report, 6 of which in the six months ended 30 June 2022,
pursuant to this agreement, and the values related thereto are as follows:
30 June 30 June 31 December
2022 2021 2021
(Unaudited) (Unaudited) (Audited)
US$'000 US$'000 US$'000
Gold purchased 27,515 25,271 56,147
Refining costs 15 14 31
Freight costs 28 20 55
27,558 25,305 56,233
30 June 30 June 31 December
2022 2021 2021
(Unaudited) (Unaudited) (Audited)
Oz Oz Oz
Gold purchased 14,596 14,018 31,219
At 30 June 2022 the net payable in EGP owing to the Central Bank of Egypt is
approximately the equivalent of US$42,922 (30 June 2021: US$271,740 net
payable and 31 December 2021: US$24,761 net payable).
4.2 Going concern
Under guidelines set out by the FRC, the directors of UK listed companies are
required to consider whether the going concern basis is the appropriate basis
of preparation of consolidated financial statements, under the historical cost
convention, as modified by financial assets and financial liabilities
(including derivative) instruments which are measured at fair value.
The FRC has released updated guidelines regarding disclosure of "material
uncertainties" related to going concern in current circumstances. Material
uncertainties refers to uncertainties related to events or conditions that may
cast significant doubt upon the entity's ability to continue as a going
concern. In other words, if boards identify possible events or scenarios
(other than those with a remote possibility of occurring) that could lead to
corporate failure, then these should be disclosed. When assessing whether
material uncertainties exist, boards should consider both the uncertainty and
the likely success of any realistically possible response to mitigate this
uncertainty.
The economic impact of the COVID-19 pandemic has and will continue to have its
effect, but currently there are no material financial implications to our
operations, Sukari continues to operate with confirmed cases on site, gold
sales are still commencing on a weekly basis. Weekly cash flow forecasts
continue to be performed and distributions to EMRA and PGM are continuing,
however these can be halted should cash be required locally. To date there has
been no significant impact to critical stock on site and additional stock has
been purchased where required, this is continuously being assessed and further
backup plans are in place.
It is not expected that COVID-19 will have a material negative impact on the
ability of the Group to operate as a going concern.
Management performed detailed analyses and forecasts to assess the economic
impact of various downside scenarios from a going concern and viability
perspective as at 31 December 2021. Based on the financial and operational
performance analysis and review done for the six month period to 30 June 2022
the Company is still operating within budget and guidance in terms of
production and costs. This half year performance review completed shortly
after a detailed analysis to support the year end going concern assessment was
sufficient to give directors comfort that the Company's financial statements
for the six months ended 30 June 2022 be prepared on a going concern basis.
However, the Group continues to monitor the business' major cost drivers e.g.,
fuel and other key consumables and reagents as well as key operational KPIs
that may have an impact on going concern and take mitigating actions where
necessary. The Group continues to benefit from a strong balance sheet with
large cash balances and no debt. At 30 June 2022 the Group had cash and cash
equivalents of US$127 million.
notes to the unaudited interim condensed consolidated financial statements
for the six months ended 30 June 2022
These financial statements for the six month period ended 30 June 2022 have
therefore been prepared on a going concern basis, which contemplate the
realisation of assets and liquidation of liabilities during the normal course
of operations.
4.3 Summary of significant accounting policies
Basis of preparation
These unaudited interim condensed consolidated financial statements have been
prepared in accordance with IAS 34 "Interim Financial Reporting" (IAS 34) as
adopted by the European Union and the requirements of the Disclosure and
Transparency Rule sourcebook (DTR) of the Financial Conduct Authority (FCA) in
the United Kingdom as applicable to interim financial reporting. These
unaudited interim condensed consolidated financial statements are not affected
by seasonality.
The unaudited interim condensed consolidated financial statements represent a
'condensed set of financial statements' as referred to in the DTR issued by
the FCA. Accordingly, they do not include all of the information required for
a full annual financial report and are to be read in conjunction with the
Group's financial statements for the year ended 31 December 2021, which were
prepared in accordance with International Financial Reporting Standards
("IFRS") as adopted for use by the European Union. The financial statements
for the year ended 31 December 2021 have been filed with the Jersey Financial
Services Commission. The financial information contained in this report does
not constitute statutory accounts under the Companies (Jersey) Law 1991, as
amended.
The financial information for the year ended 31 December 2021 is based on the
statutory accounts for the year ended 31 December 2021. Readers are referred
to the auditor's report on the Group financial statements as at 31 December
2021 (available at www.centamin.com (http://www.centamin.com) ).
The accounting policies applied in these interim financial statements are
consistent with those used in the annual consolidated financial statements for
the year ended 31 December 2021 except for the adoption of new standards and
endorsed by the EU which apply for the first time in 2022 as referred to in
the 31 December 2021 Annual Report. The Group has not early adopted any
amendments, standards or interpretations that have been issued but are not yet
effective.
The preparation of these interim condensed consolidated financial statements
requires the use of certain significant accounting estimates and judgements by
management in applying the Group's accounting policies. There have been no
changes to areas involving significant judgement and estimates, other than
those disclosed in note 1.1 above, and set out in Note 1 of the Group's annual
audited consolidated financial statements for the year ended 31 December 2021.
-END-
1 (#_ftnref1) All profit share payments are made to Egyptian Mineral
Resource Authority ("EMRA"), a department of the Ministry of Petroleum and
Mineral Resources.
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