REG - Greatland Gold PLC - Interim Results
21/03/2022 07:15
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RNS Number : 4131F Greatland Gold PLC 21 March 2022
21 March 2022
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE UK
MARKET ABUSE REGULATIONS. ON PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY
INFORMATION SERVICE, THIS INFORMATION IS CONSIDERED TO BE IN THE PUBLIC
DOMAIN.
Greatland Gold plc
("Greatland" or "the Company")
Interim Results
Greatland Gold plc (AIM:GGP), a mining development and exploration company
with a focus on precious and base metals, is pleased to announce its interim
results for the six months ended 31 December 2021.
Operational highlights
The Company made significant progress in the first six months of the financial
year:
Havieron
§ The Stage 1 Pre-Feasibility Study ("PFS") on the South-East Crescent of the
Havieron deposit was released on 12 October 2021
§ PFS revealed the tip of the Havieron iceberg with a fraction of the initial
resource supporting the total capex of the project, justifying a fast start
approach to early cashflow generation and reinvesting back into Havieron
development and infrastructure.
§ In addition, Havieron completed a total of 219,561m of drilling from 266
holes, with all the latest completed holes continuing to intersect
mineralisation, and 19 reporting significant mineralisation.
§ Post period on 3 March 2022, announced an updated mineral resource that
substantially increased Havieron Resource and Reserve
Juri Joint Venture ("Juri JV")
§ Juri JV maiden drilling programme was completed on the Paterson Range East
and Black Hills tenements
§ Comprised nine holes for 4,958m testing six targets
§ Gold assays found mineralisation at the Saddle Reefs target within Black
Hills and first gold identified at the Goliath Prospect
§ Advanced to Stage 2 to expand the exploration programme at the Juri JV
Further exploration in the Paterson region
§ Drilling multiple new targets within the Scallywag licence, following
analysis of results of an airborne Electromagnetic survey conducted last year
and further geological interpretation of regional aeromagnetic and gravity
datasets
§ Other exploration analysis and detailed target identification on
Greatland's other 100% owned tenements
§ On 16 September 2021 acquired the 100% owned Pascalle tenement, the 100%
owned Taunton tenement and two tenement applications for exploration licences
in the Paterson Province of Western Australia for a consideration of cash and
shares.
Corporate and financial highlights
§ In November 2021, the Company issued 82,000,000 new ordinary shares at an
issue price of £0.145 per share for a total consideration of £11,195,067,
net of costs.
§ Expanded the management team and Board of Directors with the following
appointments:
§ Christopher Toon as Chief Financial Officer on 8 July 2021
§ Otto Richter as Group Mining Engineer on 11 August 2021
§ Paul Hallam as a Non-Executive Director, effective 1 September 2021
Shaun Day, Chief Executive Officer of Greatland Gold plc, commented:
"We are very pleased with the strides we have taken in the first six months of
the year as we continued to deliver outstanding progress at Havieron, ensured
the Company remained well capitalised to accelerate exploration activities and
built up of the breadth and capability of the Greatland management team and
Board.
At Havieron, our joint venture with Newcrest released the Stage 1
Pre-Feasibility Study. The study revealed that a segment of the initial
resource covers the total capex of the project, supporting Greatland's belief
that the profile of Havieron makes it a globally unique opportunity for
bringing a low risk, low capex tier-one gold-copper mine into production. In
addition, the rapid development and growth potential at Havieron was
demonstrated by the recently released mineral resource and reserve update
which, in only 10 months of further drilling, added more than 50% in total
gold content.
Looking ahead, 2022 is set to be an exciting and busy time for Greatland with
the extensive growth drilling campaign continuing at Havieron and a
Feasibility Study due by the December 2022 quarter. We are also preparing
for the upcoming launch of the 2022 exploration programme at the Juri JV
building upon the results from the initial campaign and focusing on drilling
several high-priority targets, along with ramping up exploration activities
across our 100% owned targets. Greatland is in a strong operational position
with an experienced team to execute our growth plans to increase shareholder
value and build a company of significant scale."
Operational review
HAVIERON PROJECT - HAVIERON JOINT VENTURE, WESTERN AUSTRALIA (GREATLAND: 30%)
The Havieron Project ("Havieron" or "Project") is currently in development
under a Joint Venture with Newcrest Mining Limited ("Newcrest"), Australia's
largest gold producer. Havieron is located just 45km from Newcrest's Telfer
mine. This allows Havieron to leverage Telfer's existing infrastructure and
processing plant to significantly reduce the project's capital expenditure and
carbon impact for a low cost pathway to development under an ore tolling
arrangement.
Havieron was discovered by Greatland in 2018 and has become established as one
of the most exciting long life gold-copper deposits in development worldwide.
It provides Greatland with a strategic position in the Paterson Province of
Western Australia, one of the leading frontiers for the discovery of tier-one
gold-copper deposits. Newcrest assumed management of the Joint Venture in May
2019 and has since been undertaking the ore body definition and technical
studies required to support regulatory approvals and investment decisions for
a staged development plan.
The Stage 1 Pre-Feasibility Study (PFS) on the South-East Crescent of the
Havieron deposit was released on 12 October 2021. The study outcome was
positive, showing that a fraction of the initial resource supported the total
capital of the project, justifying a fast start approach to early cashflow
generation and reinvesting back into Havieron development and
infrastructure. This supports the Company's belief that the profile of
Havieron makes it a globally unique opportunity for bringing a low risk, low
capital tier-one gold-copper mine into production.
On 9 December 2021, the Company announced the joint venture had completed a
total of 219,561m of drilling from 266 holes, with all the latest completed
holes continuing to intersect mineralisation, and 19 reporting significant
mineralisation. Key updates to the development and exploration of Havieron
during the period were as follows:
§ 24 new drill holes, including 20 holes from the Infill Drilling programme
and 4 from the Growth Drilling programme.
§ Significant mineralisation was reported in 19 of the new holes.
§ A further 10 drill holes have been completed and are awaiting assay.
§ Infill drilling within the South Eastern Crescent Zone Inferred Mineral
Resource supports the modelled grade and thickness within the South East
Crescent Zone Mineral Resource.
§ Growth drilling continued to show potential for resource additions outside
the existing Inferred Mineral Resource, including a mineralised zone 100m
below and 100m to the north-west of prior grade holes.
§ Drilling to test geophysical targets outside of the known Havieron system
commenced at Havieron North, and Zipa.
§ All drilling is now focused on growth programs to continue into 2022 with 6
drill rigs operational.
§ Construction activities are progressing well with exploration decline
advanced 245 metres.
§ Planning commenced for the first ventilation shaft.
In December 2021, Newcrest issued a notice to the Company to begin the process
under the Joint Venture Agreement ("JVA") to exercise the option to acquire an
additional 5% interest in the Havieron Joint Venture from Greatland at fair
market value, as determined under the JVA principles. Under the JVA, if the
option exercise price cannot be agreed, each party is thereafter required to
notify the other of its assessment of fair market value. If both parties'
assessments are within 10% of each other, the option exercise price will be
the average of those assessments. If both parties' assessments are not within
10% of each other, the parties will proceed to independent expert valuer
determination, with the expert being required to determine which of the fair
market values nominated by the parties is to be the option exercise price.
Subsequent to the period end, on 2 March 2022 both parties agreed to some
minor modifications to the option process which included increasing the
valuation range noted above from 10% to 20%.
Following agreement or determination of the option exercise
price, Newcrest has 30 business days to exercise its option to acquire the
additional 5% interest. Proceeds from the exercise will first be used to
repay the outstanding balance under the existing Newcrest loan facility.
As at the date of this report, both parties continue to have discussions
regarding the acquisition of the additional 5% interest in the Havieron Joint
Venture.
As outlined in previous announcements, most recently on 9 December
2021, following delivery of a Pre-Feasibility Study and meeting the relevant
expenditure commitment, Newcrest is entitled (on the terms of the JVA) to an
additional 10% joint venture interest, and exercising this entitlement will
result in an overall joint venture interest of 70% Newcrest (30% Greatland).
If the option referred to above is exercised, Newcrest will be entitled to
an overall joint venture interest of 75% (Greatland 25%).
In addition, on 3 March 2022 Greatland announced a Havieron Mineral Resource
update. This increased the Mineral Resource, including Ore Reserves, to 5.5
million oz Au and 218kt Cu or 6.5M oz AuEq, an increase of 2.1 million oz Au
Eq since the last Mineral Resource update. Probable Ore Reserves now stand at
2.4 million oz Au and 109kt Cu or 2.9M oz AuEq compared to the 1.7 million oz
AuEq in the Initial Ore Reserve estimation. In addition to the Mineral
Resources within the Havieron Breccia complex, growth drilling has now defined
an initial Mineral Resource within the separate Eastern Breccia complex. This
is the first Mineral Resource in a mineralised system outside the Havieron
Breccia system and remains open at depth and to the south. This Eastern
Breccia Mineral Resource does not capture the recent high grade intercepts to
its south, which is of similar grade to the South East Crescent Zone. The
updated Mineral Resource incorporated an additional 10 months of consistently
impressive drilling results since the February 2021 drilling cut off used for
the last Mineral Resource update.
100% OWNED PROJECTS
Greatland has multiple 100% owned projects across Australia:
§ Scallywag project - Adjacent to the Havieron mining lease, containing a
further 20km of strike of Yeneena Group metasediments located directly to the
north-west of Havieron.
§ The Rudall and Canning projects - Applications expand Greatland's
landholding in the Paterson region by over 46% to 564 square kilometres. Both
licences are considered to be prospective for Havieron style gold-copper
mineralisation and fit Greatland's strategy to increase its exposure to the
discovery of new tier-1 gold-copper deposits.
§ The Ernest Giles project - Located in central Western Australia, covering
an area of approximately 1950 square kilometres with around 180km of strike of
rocks prospective for gold. The eastern Yilgarn Craton is one of the most
highly mineralised areas in Western Australia and is considered prospective
for large gold deposits.
§ The Panorama project - Consisting of three adjoining exploration licences,
covering 157 square kilometres, located in the Pilbara region of Western
Australia, in an area considered to be highly prospective for gold and cobalt.
§ The Bromus project - Located 25 kilometres south-west of Norseman in the
southern Yilgarn region of Western Australia. It consists of two licences,
covering 87 square kilometres of under-explored greenstone and intrusive
granites of the Archean Yilgarn Block at the southern end of the
Kalgoorlie-Norseman belt.
§ The Firetower project - Located in central north Tasmania, Australia and
covers an area of 62 square kilometres
§ The Warrentinna project - Located 60 kilometres north-east of Launceston in
north-eastern Tasmania and covers an area of 37 square kilometres with 15
kilometres of strike prospective for gold.
Exploration and evaluation expenditure activity during the period comprised of
expenditure on the Group's projects, which during the period predominately
focussed on the following:
a) Drilling multiple new targets within the Scallywag licence, following
analysis of results of an airborne Electromagnetic survey conducted last year
and further geological interpretation of regional aeromagnetic and gravity
datasets; and
b) Other exploration analysis and detailed target identification on
Greatland's other 100% owned tenements.
Further details of the exploration projects can be found on Company's website
www.greatlandgold.com (http://www.greatlandgold.com) .
In addition, on 16 September 2021 Greatland entered into an agreement with
Province Resources Limited (ASX:PRL) to acquire the 100% owned Pascalle
tenement, the 100% owned Taunton tenement and two tenement applications for
exploration licences in the Paterson Province of Western Australia for a
consideration of cash and shares.
The Pascalle tenement is proximal to world class gold-copper deposits with
Havieron 20km to the East and Newcrest's Telfer Mine 14km to the West. All
areas contain multiple magnetic and other geophysical anomalies identified to
date and which are untested by drilling.
This is the Group's first licence acquisition since Havieron and adds over
1,000km(2) of exploration ground in the Paterson region expanding Greatland's
strategic footprint in one of the most prospective exploration areas for
gold-copper deposits in Australia.
The purchase agreement was as follows:
§ Greatland acquired the right, title and interest in the Pascalle tenement
from PRL for a consideration of A$50,000, free of any encumbrance; and
§ PRL is the sole applicant of the applications for exploration licences
E45/5754 and E45/5755 (PRL Applications) and is the 100% owner of
Taunton tenement. Greatland will pay a consideration of A$100,000
plus A$200,000 in cash or A$200,000 in fully paid ordinary shares in the
capital of Greatland in respect to the withdrawal of the PRL Applications and
sale and purchase of the Taunton tenement, and if necessary, the sale and
purchase of the licences created if the PRL Applications are granted.
Settlement of the Pascalle tenement was finalised in December 2021 resulting
in acquisition costs of £26,880 capitalised as an exploration and evaluation
asset during the six months ended 31 December 2021.
JURI JOINT VENTURE, WESTERN AUSTRALIA (GREATLAND: 49%)
The Juri Joint Venture consists of two exploration licences in the prospective
Paterson region, Black Hills and Paterson Range East, under a Joint Venture
with Newcrest. Newcrest has the right to earn up to 75% interest by spending
up to A$20m in total as part of a two-stage farm-in over five years.
On 19 October 2021, Newcrest advanced to Staged 2 and earned an additional 26%
interest, resulting in Greatland's working interest reducing from 75% to 49%.
Greatland has currently continued in the role of Manager for the Juri Joint
Venture.
Key components of the Juri Joint Venture exploration activities during the
period were:
§ First phase of the drilling programme was completed on the Paterson Range
East and Black Hills tenements, which comprised nine holes for 4,958m testing
six targets.
§ All assay results received for the first phase.
§ Mineralisation found at Black Hills hole DHB003.
§ Ground Electromagnetic survey completed identifying several promising EM
conductor targets for 2022 drilling programme.
CORPORATE
Equity raising
In November 2021, the Company issued 82,000,000 new ordinary shares at an
issue price of £0.145 per share for a total consideration of £11,195,067,
net of costs.
Exchange losses
The Group has recognised a foreign exchange loss of £581,303 in the income
statement as a result of the US$27,188,755 million loan held by the Australian
subsidiary with Newcrest Operations Limited in respect of the Havieron Joint
Venture. The functional currency of the Australian subsidiary is Australian
dollars while the loan is denominated in US dollars. The unrealised foreign
exchange loss was incurred as result of the movements of the Australian dollar
against the US dollar during the period.
On consolidation, these balances are retranslated to sterling (£)
presentation currency.
People
On 8 July 2021 the Company announced the appointment of Christopher Toon as
Chief Financial Officer of the Company, in a non-Board role with effect from
12 July 2021.
On 11 August 2021 the Company announced the appointment of Otto Richter as
Group Mining Engineer with effect from 16 August 2021.
On 25 August 2021 the Company announced the appointment of Paul Hallam as a
Non-Executive Director to the board, effective 1 September 2021.
Dividends
The Board of Directors do not recommend the payment of a dividend (2020: Nil).
Significant events after the balance date
In December 2021, Newcrest issued a notice to the Company to begin the process
under the JVA to exercise the option to acquire an additional 5% interest in
the Havieron Joint Venture from Greatland at fair market value, as determined
under the JVA principles. Under the JVA, if the option exercise price cannot
be agreed, each party is thereafter required to notify the other of its
assessment of fair market value. If both parties' assessments are within 10%
of each other, the option exercise price will be the average of those
assessments. If both parties' assessments are not within 10% of each other,
the parties will proceed to independent expert valuer determination, with the
expert being required to determine which of the fair market values nominated
by the parties is to be the option exercise price.
Subsequent to the period end, on 2 March 2022 both parties agreed to some
minor modifications to the option process which included increasing the
valuation range noted above from 10% to 20%.
Following agreement or determination of the option exercise
price, Newcrest has 30 business days to exercise its option to acquire the
additional 5% interest. Proceeds from the exercise will first be used to repay
the outstanding balance under the existing Newcrest loan facility.
As at the date of this report, both parties continue to have discussions
regarding the acquisition of the additional 5% interest in the Havieron Joint
Venture.
SAFETY PERFORMANCE
The Group's aim is to achieve and maintain a high standard of workplace
safety. In order to achieve this objective, the Group provides training and
support to employees and sets demanding standards for workplace safety.
Enquiries:
Greatland Gold PLC +44 (0)20 3709 4900
Shaun Day info@greatlandgold.com
www.greatlandgold.com
SPARK Advisory Partners Limited (Nominated Adviser) +44 (0)20 3368 3550
Andrew Emmott/James Keeshan
Berenberg (Joint Corporate Broker and Financial Adviser) +44 (0)20 3207 7800
Matthew Armitt/ Varun Talwar/Detlir Elezi
Canaccord Genuity (Joint Corporate Broker and Financial Adviser) +44 (0)20 7523 8000
James Asensio/Patrick Dolaghan
Hannam & Partners (Joint Corporate Broker and Financial Adviser) +44 (0)20 7907 8500
Andrew Chubb/Matt Hasson/Jay Ashfield
SI Capital Limited (Joint Broker) +44 (0)14 8341 3500
Nick Emerson/Alan Gunn
Luther Pendragon (Media and Investor Relations) +44 (0)20 7618 9100
Harry Chathli/Alexis Gore
Notes for Editors:
Greatland Gold plc (AIM:GGP) is a mining development and exploration company
with a focus on precious and base metals. The Company's flagship asset is the
world-class Havieron gold-copper deposit in the Paterson region of Western
Australia, discovered by Greatland and presently under development in Joint
Venture with Newcrest Mining Ltd.
Havieron is located approximately 45km east of Newcrest's Telfer gold mine
and, subject to positive decision to mine, will leverage the existing
infrastructure and processing plant to significantly reduce the project's
capital expenditure and carbon impact for a low-cost pathway to development.
An extensive growth drilling programme is presently underway at Havieron with
a maiden Pre-Feasibility Study released on the South-East Crescent on 12
October 2021. Construction of the box cut and decline to develop the Havieron
deposit commenced in February 2021.
Greatland has a proven track record of discovery and exploration success. It
is pursuing the next generation of tier-one mineral deposits by applying
advanced exploration techniques in under-explored regions. The Company is
focused on safe, low-risk jurisdictions and is strategically positioned in the
highly prospective Paterson region. Greatland has a total six projects across
Australia with a focus on becoming a multi-commodity mining company of
significant scale.
Condensed Consolidated statement of comprehensive income
for the six months ended 31 December 2021
Continuing operations
Revenue - -
Exploration and evaluation expenses (1,793,379) (1,846,041)
Administration expenses (1,116,783) (842,171)
Operating loss (2,910,162) (2,688,212)
Other income - 12,902
Foreign exchange gains / (losses) 5 (581,303) -
Finance income 8 865
Finance costs (97,229) -
Loss before tax (3,588,686) (2,674,445)
Income tax expense - -
Loss for the period (3,588,686) (2,674,445)
Other comprehensive income:
Exchange differences on translation of foreign operations 6,927 56,780
Total comprehensive income for period attributable to equity holders of parent (3,581,759) (2,617,665)
Earnings per share (EPS):
Basic EPS attributable to ordinary equity holders of the parent (pence)((a)) (0.09) (0.07)
Diluted EPS attributable to ordinary equity holders of the parent (pence)((a)) (0.09) (0.07)
The consolidated income statement should be read in conjunction with the
accompanying notes.
(a) For the purpose of calculating basic earnings per share, the weighted
average number of the Group shares outstanding during the period was
3,978,408,767 (31 December 2020: 3,825,916,868). The weighted average number
of the Group shares including outstanding options is 4,081,408,767 (31
December 2020: 3,977,666,868). Dilutive earnings per share is not included on
the basis inclusion of potential ordinary shares would result in a decrease in
loss per share, and is considered anti-dilutive.
Condensed Consolidated Balance Sheet
as at 31 December 2021
ASSETS
Exploration and evaluation asset 26,880 -
Mine development 4 22,805,476 17,091,622
Right of use asset 306,642 341,912
Property, plant and equipment 100,076 120,356
Total non-current assets 23,239,074 17,553,890
Cash and cash equivalents 14,286,415 6,212,057
Trade and other receivables - 78,198
Other current assets 222,068 154,215
Total current assets 14,508,483 6,444,470
TOTAL ASSETS 37,747,557 23,998,360
LIABILITIES
Trade and other payables (1,063,690) (3,355,958)
Lease liabilities (69,245) (54,947)
Provisions (101,003) (102,607)
Total current liabilities (1,233,938) (3,513,512)
Borrowings 5 (20,149,282) (12,189,790)
Lease liabilities (248,017) (293,452)
Provisions (3,876,390) (3,846,713)
Total non-current liabilities (24,273,689) (16,329,955)
TOTAL LIABILITIES (25,507,627) (19,843,467)
NET ASSETS 12,239,930 4,154,893
EQUITY
Share capital 6 4,046,547 3,947,270
Share premium 6 35,593,273 24,064,307
Reserves 577,486 532,177
Retained earnings (27,977,376) (24,388,861)
TOTAL EQUITY 12,239,930 4,154,893
The consolidated balance sheet should be read in conjunction with the
accompanying notes.
Condensed Consolidated Statement of Changes in Equity
for the six months ended 31 December 2021
Note Share capital Retained earnings Total equity
£
£
Foreign currency translation reserve Share based payment reserves £
£
£
Share premium Merger reserve
£
£
At 1 July 2021 3,947,270 24,064,307 225,000 129,585 177,592 (24,388,861) 4,154,893
Loss for the period - - - - - (3,588,686) (3,588,686)
Other comprehensive income - - - 6,927 - - 6,927
Total comprehensive loss for the period - - - 6,927 - (3,588,686) (3,581,759)
Transactions with owners in their capacity as owners:
Share based payments - - - - 38,553 - 38,553
Transfer on exercise of options - - - - (171) 171 -
Share capital issued 6 99,277 12,223,899 - - - - 12,323,176
Cost of share issue 6 - (694,933) - - - - (694,933)
Total contributions by and distributions to owners of the Company 99,277 11,528,966 - - 38,382 171 11,666,796
Six months ended on 31 December 2021 4,046,547 35,593,273 225,000 136,512 215,974 (27,977,376) 12,239,930
At 1 July 2020 3,760,207 19,878,782 225,000 178,320 372,953 (19,090,241) 5,325,021
Loss for the period - - - - - (2,674,445) (2,674,445)
Other comprehensive income - - - 56,780 - - 56,780
Total comprehensive loss for the period - - - 56,780 - (2,674,445) (2,617,665)
Transactions with owners in their capacity as owners:
Share based payments - - - - 22,135 - 22,135
Transfer on exercise of options - - - - (127,173) 127,173 -
Share capital issued 118,458 2,629,015 - - - - 2,747,473
Total contributions by and distributions to owners of the Company 118,458 2,629,015 - - (105,038) 127,173 2,769,608
Six months ended on 31 December 2020 3,878,665 22,507,797 225,000 235,100 267,915 (21,637,513) 5,476,964
The consolidated statement of changes in equity should be read in conjunction
with the accompanying notes.
Condensed Consolidated Statement of Cash Flows
for six months ended 31 December 2021
Cash flows from operating activities
Loss for the period (3,588,686) (2,674,445)
Depreciation 20,280 55,319
Amortisation 35,270 -
Rehabilitation unwind 89,429 -
Share option charge 38,553 22,135
Unrealised foreign exchange loss 581,303 -
Lease liability interest expense 7,149 -
Increase in other receivables 78,198 (164,124)
Increase in payables and other liabilities (1,288,760) 1,154,217
Net cash inflow from operating activities (4,027,264) (1,606,898)
Cash flows from investing activities
Interest received 8 865
Payments for exploration and evaluation assets (26,880) -
Payments for mine development and fixed assets (5,887,255) (61,107)
Net cash outflow from investing activities (5,914,127) (60,242)
Cash flows from financing activities
Proceeds from issue of shares 12,323,175 2,747,473
Transaction costs from issue of shares (694,933) -
Proceeds from borrowings 6,443,147 -
Financing for joint venture assets - (1,224,282)
Repayment of lease obligations (38,286) (38,373)
Other income - 12,902
Net cash outflow from financing activities 18,033,103 1,497,720
Net increase (decrease) in cash and cash equivalents 8,091,712 (169,420)
Net foreign exchange differences (17,354) 43,004
Cash and cash equivalents at the beginning of the period 6,212,057 6,022,745
Cash and cash equivalents at the end of the period 14,286,415 5,896,329
The consolidated statement of cash flows should be read in conjunction with
the accompanying notes.
notes to the interim financial report
for the six months ended 31 December 2021
1 Corporate information
The interim condensed consolidated financial statements of Greatland Gold plc
and its subsidiaries (collectively, the Group) for the six months ended 31
December 2021 were authorised for issue in accordance with a resolution of the
Directors on 21 March 2022.
Greatland Gold plc is a company incorporated in England and Wales whose shares
are publicly traded on the AIM (AIM: GGP). The nature of the operations and
principal activities of the Company are described in the Directors' report.
2 Basis of preparation
The interim consolidated financial statements for the six months ended 31
December 2021 are general purpose condensed financial statements prepared in
accordance with IAS 34 Interim Financial Reporting and prepared in accordance
with UK-adopted international accounting standards and are presented in
sterling. The financial information does not constitute statutory accounts
within the meaning of section 434 of the Companies Act 2006. The information
relating to the six month periods to 31 December 2021 and 31 December 2020 are
unaudited.
The interim consolidated financial statements do not include all the
information and disclosures required in the annual financial statements, and
should be read in conjunction with the Group's annual financial statements as
at 30 June 2021 and considered together with any public announcements made by
Greatland Gold plc during the half-year ended 31 December 2021. The annual
report of the Group as at and for the year ended 30 June 2021 is available at
www.greatlandgold.com (http://www.greatlandgold.com) . The report of auditors
on those financial statements was unqualified.
The accounting policies adopted are consistent with those applied by the Group
in the preparation of the annual consolidated financial statements for the
year ended 30 June 2021. The Group has not early adopted any standard,
interpretation or amendment that has been issued but is not yet effective.
Several amendments and interpretations apply for the first time in 2021, but
these do not have a material impact on the interim condensed consolidated
financial statements of the Group.
Going Concern
The consolidated entity has incurred a loss before tax of £3,588,686 for the
six months ended 31 December 2021 and had a net cash outflow of £9,941,391
from operating and investing activities. At that date there were net current
assets of £12,239,930, with cash of £14,286,415. The loss resulted from
exploration costs and associated administrative related costs.
Given the Group's current positive cash position, the Directors have a
reasonable expectation that the Group has adequate resources to continue in
operational existence for the foreseeable future. In addition, the Group has
access to a loan facility for its share of Havieron Joint Venture expenditure
up to US$50 million and is able to significantly reduce expenditure on its own
exploration programs if it wishes to do so. The Group also has the ability to
raise capital for expansion purposes, if required and has demonstrated a
consistent ability to do so in the past, as well as potential to debt fund its
share of Havieron development.
Should the directors not achieve the matters set out above, there is
significant uncertainty whether the Group will continue as a going concern and
therefore whether they will realise their assets and extinguish their
liabilities in the normal course of business and at the amounts stated in the
financial report.
Having prepared forecasts based on current resources, assessing methods of
obtaining additional finance and assessing the possible impact of COVID-19,
the Directors believe the Group has sufficient resources to meet its
obligations for a period of 12 months from the date of approval of these
financial statements. Taking these matters into consideration, the Directors
continue to adopt the going concern basis of accounting in the preparation of
the financial statements. The financial statements do not include the
adjustments that would be required should the going concern basis of
preparation no longer be appropriate.
The principal risks and uncertainties for the six month period up to 31
December 2021 remained consistent with trends reported in 2021 Annual Report.
Greatland continue to monitor areas of increasing uncertainty, namely the
evolving impacts of COVID-19.
3 Segmental information
An operating segment is a component of the Group that engage in business
activities from which it may earn revenue and incur expenditure and about
which separate financial information is available that is evaluated regularly
by the Group's Chief Operating Decision Makers (CODM) in deciding how to
allocate resources and in assessing performance.
UK The UK sector consists of the parent company which provides administrative and
management services to the subsidiary undertaking based in Australia.
Australia This segment consists of the development activities for the Havieron Joint
Venture in Western Australia and exploration and evaluation activities
throughout Australia.
Segment information is evaluated by the executive management team and is
prepared in conformity with the accounting policies adopted for preparing the
financial statements of the Group.
Segment results
Revenue - - -
Exploration and evaluation costs - (1,774,469) (1,774,469)
Administration and other costs (572,845) (511,955) (1,084,800)
Operating loss (572,845) (2,286,424) (2,859,269)
Depreciation and amortisation expenses (12,567) (38,326) (50,893)
Other income - - -
Finance income 6 2 8
Foreign exchange losses - (581,303) (581,303)
Finance expense (1,992) (95,237) (97,229)
Loss before income tax (587,398) (3,001,288) (3,588,686)
Income tax expense - - -
Net loss for the half-year (587,398) (3,001,288) (3,588,686)
Adjustments and eliminations
Net finance income, finance costs and taxes are not allocated to individual
segments as they are managed on a Group basis.
Segment assets 12,990,667 24,756,890 37,747,557
Segment liabilities (346,032) (25,161,595) (25,507,627)
Revenue - - -
Exploration and evaluation costs - (1,790,722) (1,790,722)
Administration and other costs (498,775) (343,396) (842,171)
Operating loss (498,775) (2,134,118) (2,632,893)
Depreciation and amortisation expenses - (55,319) (55,319)
Other income 10,000 2,902 12,902
Finance income 10 855 865
Finance expense - - -
Loss before income tax (488,765) (2,185,680) (2,674,445)
Income tax expense - - -
Net loss for the half-year (488,765) (2,185,680) (2,674,445)
Segment assets 5,359,105 18,639,255 23,998,360
Segment liabilities (426,530) (19,416,937) (19,843,467)
4 Mine Development
Opening net carrying amount 17,091,622 -
Additions 4,770,961 16,827,186
Capitalised facility fees 182,644 -
Capitalised interest 933,650 264,436
Adjustment of currency translation (173,401) -
Closing net carrying amount 22,805,476 17,091,622
5 Borrowings
Opening balance 12,189,790 -
Additions 6,398,238 11,572,961
Facility fees 182,644 -
Capitalised interest 933,650 264,436
Effect of foreign exchange revaluation 581,280 352,393
Adjustment of currency translation (136,320) -
Closing balance 20,149,282 12,189,790
The above amounts owing relate to a loan agreement with Newcrest Operations
Limited dated 29 November 2020 in respect of the Havieron Joint Venture.
The loan has two parts being Facility A and Facility B with values of US$20
million and US$30 million respectively. Facility B came into effect in
October 2021, when the Stage 4 commitment was satisfied by Newcrest.
Interest is calculated on the LIBOR rate plus a margin of 8% pa. Interest is
calculated every 90 days.
6 Share capital
Movement in ordinary shares
As at the beginning of the reporting period 3,947,270 24,064,307
Shares issued during the period 99,277 12,223,899
Transaction costs on share issue - (694,933)
As at the end of the reporting period 4,046,547 35,593,273
(a) The number of ordinary shares on issue was 4,046,547,171 at
the end of the period
(b) The following issues of shares were made during the year:
(i) On 29 July 2021, 250,000 new ordinary shares at £0.03 per
share for a total consideration of £7,500 to Clive Latcham as a result of a
binding option exercise notice received
(ii) On 2 August 2021, 6,216,216 new ordinary shares at £0.025 per
share for a total consideration of £155,405 from a block listing authority of
10 February 2020
(iii) On 1 September 2021, 10,810,812 new ordinary shares at £0.025
per share for a total consideration of £270,270 from a block listing
authority of 10 February 2020
(iv) 19 November 2021, the Company issued 82,000,000 new ordinary
shares at an issue price of £0.145 per share for a total consideration
of £11,890,000, with associated transaction costs of £694,933
Contingently issuable shares
(i) As disclosed on 26 September 2016, as part of the
acquisition of the Havieron Project, the Company entered into a purchase
agreement with Pacific Trends Resources Pty Ltd (as assigned) for an upfront
payment of £13,500 in cash and 65,490,000 fully paid ordinary shares in the
Company, and a deferred payment of 145,530,000 fully paid ordinary shares in
the Company contingent on:
§ a bankable feasibility study having been completed and a decision to mine
having been made on Havieron; or
§ the Company assigning 75% or more of its right or interest in Havieron to
an unrelated third party.
(ii) As disclosed on 16 September 2021, the Company entered into an
agreement with Province Resources Limited to acquire the 100% owned Taunton
tenement and two tenement applications for exploration licences in the
Paterson Provision of Western Australia for a consideration of cash and
shares. Greatland will pay a consideration of £80,640 plus £107,520 in
cash or £107,520 in fully paid ordinary shares in the capital of Greatland
in respect to the withdrawal of the PRL applications and sale and purchase of
the Taunton tenement, and if necessary, the sale and purchase of the
licences created if the PRL applications are granted.
The conditions attached to the contingently issued shares had not yet been
satisfied at the end of the reporting period, and as such were not included in
the diluted earnings per share calculation at 31 December 2021.
7 Related Parties
(a) On 29 July 2021 the Company received a binding option exercise notice
from Clive Latcham for 250,000 options at £0.03 pence per share for a total
consideration of £7,500.
(b) The following directors and officers of the Company participated in the
share subscription in November 2021 at an issue price of £0.145 per share, as
follows:
Shaun Day (Chief Executive Officer) 375,000 54,400
Christopher Toon (Chief Financial Officer) 110,000 15,958
(c) There have been no other significant changes in the nature of related
parties or amounts during the period.
8 Dividends paid and proposed
No dividends were paid or proposed by the Directors. (2020: £Nil)
9 Capital Commitments
Exploration commitments
Ongoing exploration expenditure is required to maintain title to the Group
mineral exploration permits. No provision has been made in the financial
statements for these amounts as the expenditure is expected to be fulfilled in
the normal course of the operations of the Group.
As disclosed on 16 September 2021, the Company entered into an agreement with
Province Resources Limited to acquire the 100% owned Taunton tenement and two
tenement applications for exploration licences in the Paterson Provision of
Western Australia for a consideration of cash and shares. Refer to Note 6 for
further information.
There have been no other significant changes in capital commitments during the
period.
10 Significant events after the reporting date
In December 2021, Newcrest issued a notice to the Company to begin the process
under the JVA to exercise the option to acquire an additional 5% interest in
the Havieron Joint Venture from Greatland at fair market value, as determined
under the JVA principles. Under the JVA, if the option exercise price cannot
be agreed, each party is thereafter required to notify the other of its
assessment of fair market value. If both parties' assessments are within 10%
of each other, the option exercise price will be the average of those
assessments. If both parties' assessments are not within 10% of each other,
the parties will proceed to independent expert valuer determination, with the
expert being required to determine which of the fair market values nominated
by the parties is to be the option exercise price.
Subsequent to the period end, on 2 March 2022 both parties agreed to some
minor modifications to the option process which included increasing the
valuation range noted above from 10% to 20%.
Following agreement or determination of the option exercise
price, Newcrest has 30 business days to exercise its option to acquire the
additional 5% interest. Proceeds from the exercise will first be used to repay
the outstanding balance under the existing Newcrest loan facility.
As at the date of this report, both parties continue to have discussions
regarding the acquisition of the additional 5% interest in the Havieron Joint
Venture.
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