REG - Griffin Mining Ld - Unaudited Interim Results
16/08/2022 07:01
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RNS Number : 0767W Griffin Mining Ld 16 August 2022
8(th) Floor, 54 Jermyn Street, London, SW1Y 6LX. United Kingdom
Telephone: + 44 (0)20 7629 7772 Facsimile: + 44 (0)20 7629 7773
E mail: griffin@griffinmining.com (mailto:griffin@griffinmining.com)
16(th) AUGUST 2022
UNAUDITED INTERIM RESULTS
for the six months ended 30(th) June 2022
Griffin Mining Limited ("Griffin" or the "Company") has today released its
unaudited results for the six months ended 30th June 2022. It should be noted
that all operations at the Caijiaying Zinc-Gold Mine were fully suspended for
virtually the whole of the first quarter of 2022 due to the mandatory
Governmental suspension of operations directive relating to the 2022 Winter
Olympics, subsequent Winter Paralympics and the Chinese New Year holidays.
Highlights:
· Record second quarter zinc production and profitable second quarter.
· Revenues of $34.7 million (uninterrupted 6 months operations to
30(th) June 2021: $54.1 million).
· Gross Profit of $15.5 million (uninterrupted 6 months operations to
30(th) June 2021: $25.7 million).
· Profit before tax of $5.4 million (uninterrupted 6 months operations
to 30(th) June 2021: $15.5 million).
· Profit after tax of $3.0 million (uninterrupted 6 months operations
to 30(th) June 2021: $10.3 million).
· Basic earnings per share of 1.73 cents (uninterrupted 6 months
operations to 30(th) June 2021: 5.88 cents).
Financial and Trading:
The results for the six months to 30(th) June 2022 were impacted by the
suspension of operations at the Caijiaying Zinc Gold Mine imposed by the
Chinese authorities in the period during, and leading up to, the Winter
Olympics and Paralympics at Chong Li and the Chinese New Year Holidays. From
1(st) January 2022 to 23(rd) March 2022 no stoping or underground development
work was undertaken with processing not restarting until 25(th) March 2022.
Whilst minimal ore was mined and processed in the first quarter of 2022, the
second quarter to 30(th) June 2022 saw the successful recommencement of
operations with record ore mined, hauled and processed resulting in record
zinc metal in concentrate production for a quarter since operations began at
Caijiaying in June 2005.
Mining and processing have now reached the equivalent of over 1.3 million
tonnes of ore per annum, all of which has been extracted from Zone III. Zone
II has not yet been placed into production.
Quarterly analysis of the trading results underlines exceptional performance
since 25(th) March 2022:
3 months to 30(th) June 2022 3 months to 31(st) March 2022 3 months to 30(th) June 2021
Ore mined Tonnes 338,790 17,975 277,112
Ore processed Tonnes 329,390 8,649 275,576
Zinc in concentrate Produced Tonnes 13,189 268 11,645
Gold in concentrate produced Ozs 3,504 1,474 4,080
Silver in concentrate produced Ozs 79,246 168 81,098
Lead in concentrate produced Tonnes 345 7 327
Average zinc price received per tonne $ 2,886 - 2,224
Average gold price received per oz $ 1,788 - 1,684
Average silver price received per oz $ 18.1 - 20.4
Average lead price received per tonne $ 2,323 - 2,026
Zinc sales $000s 31,104 130 23,878
Lead and precious metals sales $000s 5,479 256 7,766
Royalties $000s (2,198) (22) (1,784)
Total Turnover $000s 34,385 364 29,860
Cost of sales $000s (15,457) (3,815) (15,412)
Gross profit (loss) $000s 18,928 (3,451) 14,448
Administration expenses $000s (6,040) (3,964) (5,037)
Operating profit / (loss) $000s 12,888 (7,415) 9,411
Interest and other income / (costs) $000s (118) (79) (4)
Profit (loss) before tax $000s 12,770 (7,336) 9,407
Taxation $000s (2,398) (2) (3,082)
Profit (loss) after tax $000s 10,372 (7,338) 6,325
Despite the suspension in operations in the first quarter of 2022, ore tonnes
mined in the first half of 2022 were down only 22.9% on that mined in the
first half of 2021 and tonnes processed in the first half of 2022 were down
29.0% on that achieved in the first half of 2021. Zinc metal in concentrate
produced was down 32.3% on that achieved in the first half of 2021, gold in
concentrate production was down 51.6% on that produced in the first half of
2021 and silver in concentrate production was down 44.3% on that produced in
the first half of 2021.
With 338,039 tonnes (30(th) June 2021 475,785 tonnes) of ore processed, metal
in concentrate production in the first six months of 2022 was:
· 13,457 tonnes of zinc ( 30(th) June 2021: 19,876 tonnes);
· 353 tonnes of lead (30(th) June 2021: 561 tonnes);
· 80,717 ounces of silver (30(th+) June 2021: 144,705 ounces); and
· 3,672 ounces of gold (30(th) June 2021: 7,584 ounces).
The results benefited from a significant improvement in the market price for
zinc with the average price received for zinc metal in concentrate increasing
by 31.9% from $2,209 per tonne in the first six months of 2021 to $2,914 per
tonne in the first half of 2022. Zinc revenues before royalties and resource
taxes in the six months to 30(th) June 2022 were $31,234,000 (30(th) June 2021
- $42,102,000). Lead and precious metals revenues were $5,735,000 (30(th)
June 2021 - $15,136,000), with the average gold price received of $1,788 per
oz (30(th) June 2021 - $1,675) and silver $18.1 per oz (30(th) June 2021 -
$20.4). Metal in concentrate with a potential sales value of over $9m
remained unsold at 30(th) June 2022.
During the six months to 30(th) June 2022:
- 10,719 tonnes of zinc metal in concentrate were sold (30(th) June 2021
: 19,876ozs);
- 2,491 ozs of gold in concentrate were sold (30(th) June 2021 : 6,919
ozs); and
- 44,627 ozs of silver in concentrate were sold (30(th) June 2021 :
129,990 ozs).
With operations suspended in the first quarter of 2022, costs of sales
(mining, haulage and processing) fell by 32.1% from that in the first six
months of 2021. Costs of sales in the second quarter of 2022 were in line
with that in the second quarter of 2021 despite increased ore mined and
hauled..
Administration costs were marginally reduced with a reduction in charges from
Griffin's Chinese joint venture partners based upon the profits of Hebei Hua
Ao. Otherwise, additional costs were incurred with the appointment of 3 new
directors with their associated directors fees, Mr Clive Whiley's appointment
as a consultant to the company with his associated consulting fees, annual
bonuses awarded by the directors to Keynes Capital and the Finance
Director, increased directors and officers liability insurance premiums and
the resumption of corporate travel. With the suspension in operations in the
first quarter administration costs were contained at Hebei Hua Ao.
Basic earnings per share were 1.73 cents (30(th) June 2021: 5.88 cents per
share). At 30(th) June 2022, attributable net assets per share amounted to
149 cents (30(th) June 2021: 141 cents).
With the suspension in operations in the first quarter of 2022 cash flows used
in operations in the period amounted to $4,122,000 (the cash flow generated in
the period to 30(th) June 2021 was $16,818,000). The Griffin Mining Group of
companies remains free of any bank loans.
Chairman's Statement
Chairman Mladen Ninkov commented, "What an amazing performance, yet again, by
the staff, contractors and orebody at Caijiaying. They all continue to deliver
outstanding results, even more impressive in light of the unique environment
of generally no operations at Caijiaying during the whole of the 1(st) quarter
and to then come back in the 2(nd) quarter with record ore mined, hauled and
processed, resulting in record zinc metal in concentrate production for any
quarter since operations began in June 2005. If anything further needed to be
added to that performance, the equivalent of over 1.3 million tonnes of ore on
an annualised basis was being mined and processed, all from Zone III. This is
without any contribution yet from Zone II. I couldn't be prouder or happier
with the Griffin Team and it augurs extraordinarily well for the Company in
the second half of 2022 and into 2023."
Further information
Griffin Mining Limited
Mladen Ninkov -
Chairman
Telephone: +44(0)20 7629 7772
Roger Goodwin - Finance Director
Panmure Gordon (UK)
Limited
Telephone: +44 (0)20 7886 2500
John Prior
Alisa MacMaster
Berenberg
Telephone: +44(0)20 3207 7800
Matthew Armitt
Jennifer Wyllie
Deltir Elezi
BlytheRay
Tim
Blythe
Telephone: +44(0)20 7138 3205
Megan Ray
Swiss Resource Capital AG
Jochen Staiger Telephone: +41(0)71 354 8501
This announcement contains inside information for the purposes of Article 7 of
the Market Abuse Regulation (EU) No. 596/2014
Griffin Mining Limited's shares are quoted on the Alternative Investment
Market (AIM) of the London Stock Exchange (symbol GFM).
The Company's news releases are available on the Company's web site:
www.griffinmining.com (http://www.griffinmining.com/)
Griffin Mining Limited
Condensed Consolidated Income Statement
(expressed in thousands US dollars)
6 months to 6 months to Year to
30/06/2022 30/06/2021 31/12/2021
Unaudited Unaudited Audited
$000 $000 $000
Revenue 34,749 54,072 121,648
Cost of sales (19,272) (28,401) (63,224)
Gross profit 15,477 25,671 58,424
Administration expenses (10,004) (10,209) (21,499)
Profit from operations 5,473 15,462 36,925
Losses on disposal of equipment (77) (26) (293)
Impairment of intangible fixed assets 0 (2) (11)
Foreign exchange (losses) (121) (7) (51)
Finance income 107 68 236
Finance costs (68) (152) (404)
Other income 120 63 124
Profit before tax 5,434 15,406 36,526
Income tax expense (2,400) (5,148) (11,150)
Profit after tax 3,034 10,258 25,376
Basic earnings per share (cents) 1.73 5.88 14.53
Diluted earnings per share (cents) 1.62 5.43 13.47
Griffin Mining Limited
Condensed Consolidated Statement Of Comprehensive income
(expressed in thousands US dollars)
6 months to 6 months to Year to
30/06/2022 30/06/2021 31/12/2021
Unaudited Unaudited Audited
$000 $000 $000
Profit for the financial period 3,034 10,258 25,376
Other comprehensive income
Exchange differences on translating foreign operations (7,892) 2,514 3,336
Other comprehensive income for the period, net of tax (7,892) 2,514 3,336
Total comprehensive income / (losses) for the period (4,858) 12,772
28,712
Griffin Mining Limited
Condensed Consolidated Statement Of Financial Position
(expressed in thousands US dollars)
30/06/2022 30/06/2021 31/12/2021
Unaudited Unaudited Audited
$000 $000 $000
ASSETS
Non-current assets
Property, plant and equipment 268,266 268,930 275,296
Intangible assets - exploration interests 399 349 387
268,665 269,279 275,683
Current assets
Inventories 9,198 6,257 4,516
Receivables and other current assets 3,960 4,175 2,174
Cash and cash equivalents 24,993 25,143 38,159
38,151 35,575 44,849
Total assets 306,816 304,854 320,532
EQUITY AND LIABILITIES
Equity attributable to equity holders of the parent
Share capital 1,749 1,749 1,749
Share premium 69,334 69,334 69,334
Contributing surplus 3,690 3,690 3,690
Share based payments 2,072 2,072 2,072
Shares held in treasury (1,644) (1,589) (1,644)
Chinese statutory re-investment reserve 3,105 2,858 2,896
Other reserve on acquisition of non-controlling interests (29,346) (29,346) (29,346)
Foreign exchange reserve 6,888 13,851 14,635
Profit and loss reserve 201,870 184,072 199,190
Total equity attributable to equity holders of the parent 257,718 246,691 262,576
Non-current liabilities
Other payables 13,112 13,622 10,352
Long-term provisions 2,576 2,264 2,667
Deferred taxation 3,078 3,392 3,240
Finance leases 705 - 794
19,471 19,278 17,053
Current liabilities
Trade and other payables 29,427 38,842 40,726
Finance leases 200 43 177
Total current liabilities 29,627 38,885 40,903
Total equities and liabilities 306,816 304,854 320,532
Number of shares in issue 174,892,894 174,892,894 174,892,894
Attributable net asset value / total equity per share $1.47 $1.41 $1.50
Griffin Mining Limited
Condensed Consolidated Statement of Changes in Equity
(expressed in thousands US dollars)
Share Share Contributing Share Shares Chinese Other Foreign Profit Total
Capital Premium surplus based held in re investment reserve on exchange and loss attributable
payments treasury reserve acquisition of reserve reserve to equity holders
non-controlling of parent
interests
$000 $000 $000 $000 $000 $000 $000 $000 $000 $000
At 31(st) December 2020 1,728 68,470 3,690 2,072 (917) 2,830 (29,346) 11,365 173,814 233,706
Purchase of shares for treasury - - - - (672) (672)
Issue of shares on exercise of options 21 864 - - - - - - - 885
Transaction with owners 21 864 - - (672) - - - - 213
Retained profit for the 6 months - - - - - - - - 10,258 10,258
Other comprehensive income:
Exchange differences on translating foreign operations - - - - - 28 - 2,486 - 2,514
Total comprehensive income for the period - - - - - 28 - 2,486 10,258 12,772
At 30(th) June 2021 (Unaudited) 1,749 69,334 3,690 2,072 (1,589) 2,858 (29,346) 13,851 184,072 246,691
Purchase of shares for treasury - - - - (55) - - - - (55)
Transaction with owners - - - - (55) - - - (55)
Retained profit for the 6 months - - - - - - - - 15,118 15,118
Other comprehensive income:
Exchange differences on translating foreign operations - - - - 38 - 784 - 822
-
Total comprehensive income for the period - - - - - 38 - 784 15,118 15,940
At 31(st) December 2021 1,749 69,334 3,690 2,072 (1,644) 2,896 (29,346) 14,635 199,190 262,576
Regulatory transfer for future investment - - - - - 354 - - (354) -
Transaction with owners - - - - - 354 - - (354) -
Retained profit for the 6 months - - - - - - - - 3,034 3,034
Other comprehensive income:
Exchange differences on translating foreign operations - - - - - (145) - (7,747) - (7,892)
Total comprehensive income for the period - - - - - (145) - (7,747) 3,034 (4,858)
At 30(th) June 2022 (Unaudited) 1,749 69,334 3,690 2,072 (1,644) 3,105 (29,346) 6,888 201,870 257,718
Griffin Mining Limited
Condensed Consolidated Cash Flow Statement
(expressed in thousands US dollars)
6 months to 6 months to Year to
30/06/22 30/06/2021 31/12/2021
$000 $000 $000
Net cash flows from operating activities
Profit before taxation 5,434 15,406 36,526
Foreign exchange losses 121 7 51
Finance income (107) (68) (236)
Finance costs 68 152 404
Depreciation, depletion and amortisation 7,226 7,964 16,530
Impairment of intangible assets 0 2 11
Losses on disposal of equipment 77 26 293
(Increase) / decrease in inventories (4,683) (924) 817
(Increase) / decrease in receivables and other current assets (2,011) 2,936 4,936
(Decrease) in trade and other payables (7,351) (1,395) (2,871)
Taxation paid (2,896) (7,288) (13,581)
Net cash (outflow) / inflow from operating activities (4,122) 16,818 42,880
Cash flows from investing activities
Interest received 107 68 236
Proceeds / (expenses) on disposal of equipment 11 0 1
Payments to acquire - mineral interests (mine development) (3,619) (7,471) (13,564)
Payments to acquire - plant & equipment (6,846) (1,215) (6,365)
Payments to acquire - intangible assets - exploration interests (13) (26) (73)
Net cash (outflow) from investing activities (10,360) (8,644) (19,765)
Cash flows from financing activities
Issue of shares on exercise of share purchase options 0 885 885
Purchase of shares for treasury 0 (672) (309)
Interest paid 0 (101) (727)
Bank loan advances 0 0 15,500
Repayment of bank loans 0 0 (15,500)
Finance lease repayments (90) (357) (462)
Net cash (outflow) from financing activities (90) (245) (613)
Increase / (decrease) in cash and cash equivalents (14,572) 7,929 22,502
Cash and cash equivalents at beginning of the period 38,159 16,435 16,435
Effects of exchange rate changes 1,406 779 (778)
Cash and cash equivalents at end of the period 24,993 25,143 38,159
Griffin Mining Limited
Notes to the Interim Statement
1. These unaudited condensed consolidated interim financial statements
have been prepared in accordance with the accounting policies adopted in the
last annual financial statements for the year to 31(st) December 2021.
2. This interim report will be available on the Company's web site,
www.griffinmining.com (http://www.griffinmining.com) . Hard copies are
available from the Company's London office, 8(th) Floor, Royal Trust House, 54
Jermyn Street, London. SW1Y 6LX.
3. The summary accounts set out above do not constitute statutory
accounts as defined by Section 84 of the Bermuda Companies Act 1981 or Section
434 of the UK Companies Act 2006. The consolidated statement of financial
position at 31(st) December 2021 and the consolidated income statement,
consolidated statement of comprehensive income, consolidated statement of
changes in equity and the consolidated cash flow statement for the year then
ended have been extracted from the Group's 2021 statutory financial statements
upon which the auditors' opinion is unqualified, and should be read in
conjunction with the accompanying notes contained therein.
4. The summary accounts have been prepared on a going concern basis.
Having considered recent events, including the impact of Covid-19, the Group's
cash resources, banking facilities and regularly updated forecasts, the
directors consider that the Group will be able to meet its liabilities as they
fall due.
5. The calculation of the basic earnings per share is based on the
earnings attributable to ordinary shareholders divided by the weighted average
number of shares in issue during the period. The calculation of diluted
earnings per share is based on the basic earnings per share on the assumed
conversion of all dilutive options and other dilutive potential ordinary
shares.
6. Reconciliation of the earnings and weighted average number of
shares used in the calculations are set out below:
6 months to 6 months to Year to
30/06/2022 30/06/2021 31/12/2021
Unaudited
Unaudited Audited
Earnings Weighted Per share amount Weighted Per share amount (cents) Earnings Weighted Per share amount (cents)
$000 average number of shares (cents) average number of shares $000 average number of shares
Earnings
$000
Basic (loss) / earnings per share
(Loss) earnings attributable to ordinary shareholders 3,034 174,653,602 1.73 10,258 174,410,343 5.88 25,376 174,653,602 14.53
Dilutive effect of securities
Options 12,950,882 (0.11) 14,374,897 (0.45) 13,730,107 (1.06)
Diluted earnings per share 187,843,776 1.62 188,785,241 5.43 25,376 188,383,709 13.47
3,034 10,258
7. As at 30(th) June 2022 there were no adjusting post balance sheet
events.
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