REG - Hamak Gold Limited - Interim Results
18/09/2024 07:00
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RNS Number : 5282E Hamak Gold Limited 18 September 2024
18 September 2024
Hamak Gold Limited
("Hamak Gold" or the "Company")
Interim Results
Hamak Gold Limited (LSE: HAMA) is pleased to announce its results for the
six-month period ending 30 June 2024 (the "period").
Highlights
· An independent technical report was completed on all geological and
drilling data at Nimba with recommendations for next phases of work to further
define the high-grade gold discovery at the Ziatoyah prospect
· Detailed geological and structural mapping, with complementary rock
chip sampling, trenching and channel sampling, completed over a 17 square
kilometre area defined by the strong gold in soil anomaly associated with the
Ziatoyah gold discovery
· Several priority drill targets are recommended from the recent
exploration programme results with the objective of defining extensions of the
high-grade Ziatoyah gold discovery
· £200,000 raised (before costs) for continuation exploration at the
Nimba licence and general working capital
Highlights Post Period
· £300,000 Convertible Loan Note agreement entered into with Vela
Technologies plc
· Completion of an independent technical report on the detailed
structural mapping and trenching exercise, with recommendations for priority
drill targets at Ziatoyah
Karl Smithson, Executive Director of Hamak Gold, commented:
"Our exploration work continues to focus on the highly prospective Nimba
licence and in particular the significant gold discovery we have made at the
Ziatoyah prospect. We have elected to follow a systematic exploration
programme of detailed mapping and sampling to help guide the selection of
priority drill targets to further define and delineate extensions to the
high-grade surface and drill intersections we have made at Ziatoyah. Capital
markets remain very challenging for the junior mining sector and the Company
therefore continues to evaluate opportunities that can generate shareholder
value."
For further information you are invited to view the company's website at
www.hamakgold.com or please contact:
Hamak Gold Limited
Amara Kamara +231 (0) 77 005 0005
Karl Smithson +44 (0) 77 837 07971
Peterhouse Capital Limited (Corporate Broker) +44 (0) 20 7469 0930
Yellow Jersey PR
Annabelle Wills +44 (0) 20 3004 9512
About Hamak Gold Limited
Hamak Gold Limited (LSE: HAMA) is a UK listed company focussed on gold
exploration of a portfolio of licences in highly prospective areas of Liberia,
where significant drilling results have identified a new high-grade gold
discovery with the discovery hole returning 20m @ 7g/t Au near surface in its
Nimba licence on the border with Ivory Coast which is located in proximity to
the commercial Ity Gold Mine.
INTERIM MANAGEMENT REPORT
Operating Review
The Company's activities during the period continued to focus on its highly
prospective Nimba Licence and in particular the high-grade Ziatoyah gold
discovery. During the reporting period the Company undertook further detailed
mapping together, trenching and rock chip sampling to better understand the
geology of the prospect as well as the extent of the mineralisation indicated
by the 5.7km x 1km NE trending gold-in-soil anomaly.
Licence Holdings
Hamak Gold holds two exploration licences, covering a combined area of 1,115.2
square kilometres ("km"), known as Nimba and Gozohn. Bedrock gold discoveries,
associated with extensive gold in soil anomalies, have been made at both
licences. Exploration efforts during the reporting period focussed on the
Nimba licence Ziatoyah gold discovery.
Nimba Licence
The Nimba Licence (MEL7001518) covers an area of 985.60 square kilometres and
is located approximately 120km to the north-east of the Gozohn licence and
some 25km west of Endeavour Mining's 5-million-ounce ("Moz") Ity Gold Mine in
neighbouring Cote D'Ivoire.
Since the Company's IPO in March 2022, detailed soil, trench/channel and rock
chip sampling have been completed with positive results. In late 2022, this
culminated in the discovery of an outcropping (at surface) gold mineralized
metadolerite unit at a site called Ziatoyah, which was subsequently drilled
and returned a best result of 20m at 7g/t Au near surface and under the
mineralized outcrop.
The associated gold in soil anomaly extends over a 5.7km by 1km northeast
trending area, where outcrop is limited. Streams that dissect the anomaly
are exploited by artisanal gold miners, suggesting that the extent of the
anomaly may be related to an extensive hard rock gold deposit.
In 2023, an Induced Polarisation (IP) geophysical survey was completed over a
restricted area of the Ziatoyah area in attempt to locate sub-surface sulphide
mineralization that could be associated with gold. This was followed by a
limited drill programme of 1,000m to test the geophysical anomalies generated,
but with limited success. The IP tended not to efficiently penetrate the deep
weathering profile and detect the sulphide mineralization at depth.
Therefore, the Company undertook a detailed mapping and structural analysis of
the Ziatoyah areas that returned high values of gold in soil. Structural
interpretation based on the detailed multi-element geochemical assays of the
soil sampling, surface outcrop and drill core were also carried out. Several
drill targets have been selected with the objective of defining extensions of
the high-grade Ziatoyah gold discovery based on the geophysical and
geochemical results.
The Cestos shear zone, associated with the 5moz Ity Gold mine, is located
along the southeast boundary of the Nimba licence and is defined by a major NE
trending dislocation zone. Historical aeromagnetic data from the US Geological
Survey implies a pattern of southwesterly to westerly trending secondary
structures branching off this shear zone. Such secondary faults, or splays,
may have created extensional zones for the focus of hydrothermal activity
responsible for gold mineralisation.
Following a detailed review of all exploration data during late 2023 and early
2024, it is now believed that regional scale folds and probable associated
parasitic folds should be considered the primary exploration targets across
the Nimba Licence. There are clear signs that the area has undergone more than
one deformational event judging by the structural trends discernible at map
scale. During the reporting period the Company conducted additional detailed
field mapping and has refined its model of the stratigraphic, lithological,
alteration patterns and structural controls to the mineralisation at the
Ziatoyah prospect.
An area of 17 km² has now been mapped and some 260 outcrops described with
structural measurements having been recorded from 141 of these. In addition,
further rock chip samples (showing mineralisation - mostly pyrite) were
collected, which complement the three positive rock samples collected
previously, which returned best grades of 6g/t Au, 38g/t Au and 45g/t Au.
It appears that there is a broad, widespread distribution of mineralised
outcrops exposed within the prospect area. Nearly all the mineralised outcrops
comprise meta-dolerite with one sample deriving from a quartzite (possibly
meta-sediment). The structural orientation of the mineralised outcrops trends
towards the north or north northeast.
Post period end, a number of trenches were excavated to reveal the exposure of
more structures, which have been mapped and which enhance the preliminary
structural interpretation, thereby strengthening the confidence level in
planning the next phase of drill targets to intersect the significant gold
mineralization identified at Ziatoyah. Some 42 channel samples have been
collected from the trenches and prepped in advance of assay.
Gozohn Licence
The Gozohn licence (MEL 7002318) covers an area of 129.6 square km and is
located some 30 km to the south of the high-grade Kokoya Gold mine operated by
MNG Gold. The licence is host to a number of structurally controlled
greenstone belts similar to those at Kokoya, with strongly deformed
amphibolite, quartzite, schist and banded ironstone formations, which
generally occur as pronounced topographic highs.
Previous soil, rock and trench sampling has identified a 1,500m long gold in
soil anomaly with rock chip samples returning grades of 2.56g/t Au and 3.37
g/t Au, which are interpreted as being related to gold in quartz veins that
permeate the greenstone belt geology.
No exploration was undertaken on Gozohn during the reporting period as
resources were focussed on Nimba as a priority.
Outlook
Following the 2nd phase scout drilling programme, the Company has undertaken
an in-depth technical review of all the exploration data captured to date,
with emphasis on the structural interpretation from drill core and outcrop
measurements. Relogging of the drill core has led to a better understanding
of the geology and the recognition of metasediments such that the packages fit
well with an Archean Greenstone Terrain designation. There is sufficient
evidence that the strong mineralisation seen in the drill hole that returned
7g/t Au over 20m could be stratigraphically, or at least, lithologically
controlled rather than having a primary structural control.
Extensive detailed mapping during the reporting period has now revealed a
large outcrop coverage area from which a significant number of structural
readings have been captured. This extensive database has been reviewed and
interpretated with recommendations provided for priority drill targets for a
more extensive drilling programme to identify extensions of the high-grade
intersection at Ziatoyah.
The principal risks identified by the Company in the forthcoming reporting
period include the renewal of the Nimba and Gozohn exploration licences for a
further period of exploration. Applications for extensions have been made and
are currently under review by the Ministry of Mines. The Company is confident
that the licence renewals will be issued in due course.
Funding
The capital markets for junior exploration companies have proven extremely
challenging for quite some time, irrespective of the buoyant gold price. In
April 2024 the Company raised £200,000 at a price of 1.25p per share, to be
allocated towards the continued exploration at the Nimba licence and for
general working capital.
Post period, the Company entered into an investment agreement with Vela
Technologies plc ("Vela") whereby the Company received 2,424,242,424 ordinary
shares in Vela in return for the issue of £300,000 of Hamak unsecured
convertible loan notes of £1 each ("CLNs"). The notes are redeemable after
24 months with interest accruing at 10% per annum. Vela is subject to a six
month lock in period during which no conversion of the loan notes is allowed.
A conversion notice of the loan notes can be issued by Vela any time between 6
months and maturity, The conversion price will be the lower of £0.03 or a 25%
discount to the five-day VWAP immediately prior to conversion. Any accrued
interest will be payable in cash on the conversion date. Hamak Gold intends
to, over time and in an orderly manner, transact the Vela shares to realise
cash for ongoing exploration and working capital costs.
The Company will seek to raise further capital going forward to fund the
continuation of its exploration programmes, though this will be contingent on
the capability of further capital to be raised.
Responsibility Statement
The Directors confirm that to the best of their knowledge:
(a) the condensed set of financial statements has been prepared in accordance
with IAS 34 'Interim Financial Reporting' as contained in UK-adopted
international accounting standards;
(b) the interim management report includes a fair review of the information
required by DTR 4.2.7R of the Disclosure and Transparency Rules (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
(c) the interim management report includes a fair review of the information
required by DTR 4.2.8R of the Disclosure and Transparency Rules (disclosure of
related parties' transactions and changes therein).
Karl Smithson
Executive Director
18 September 2024
Condensed Consolidated Statement of Comprehensive Income
For the six months ended 30 June 2024
6 months ended 6 months ended
30 June 2024 Unaudited 30 June 2023 Unaudited
Note
Continuing operations $000 $000
General and administrative expenses 306 261
Operating Loss 306 261
Loss before taxation 306 261
Tax charge - -
Loss after taxation 306 261
Loss for the period 306 261
Loss per share from continuing operations in cents per share: Basic and
diluted in USD
6 (0.004) (0.006)
Condensed Consolidated Statement of Financial Position
For the six months ended 30 June 2024
Note 6 months ended Year ended
30 June 2024 Unaudited 31 December 2023
Audited
$000 $000
Non-current assets
Property, plant and equipment 7 17 23
Intangible assets 8 2,046 1,481
Total non-current assets 2,063 1,978
Current assets
Trade and other receivables 49 25
Cash and cash equivalents 9 64 2
Total current assets 113 27
Total assets 2,176 2,005
Equity and Liabilities
Equity attributable to owners of the parent
Share capital 10 4,261 3,805
Share based payment reserve 21 16
Accumulated deficit (2,578) (2,272)
Total equity 1,704 1,549
Current liabilities
Trade and other payables 472 456
Total current liabilities - 456
Total equity and liabilities 2,176 2,005
Condensed Consolidated Statement of Changes in Equity
For the six months ended 30 June 2024
Share based payment
Share capital Accumulated deficit Total
equity
$000 $000 $000 $000
Balance at 1 January 2023 2,758 80 (1,697) 1,141
Loss for the period - - (261) (261)
Issue of share capital 563 - - 563
Issue costs (19) - - (19)
Share-based awards exercised or lapsed - (110) 110 -
Share-based payment - vesting - 40 - 40
Balance at 30 June 2023 - Unaudited 3,302 10 (1,848) 1,464
Loss for the period - - (423) (423)
Issue of share capital 513 - - 513
Issue costs (10) - - (10)
Share-based payment - vesting - 5 - 5
Share-based payment - awards exercised or lapsed - 1 (1) 1
Balance at 31 December 2023 - Audited 3,805 16 (2,272) 1,549
Loss for the period - - (306) (306)
Issue of share capital 475 - - 475
Issue costs (19) - - (19)
Share based awards charge - 5 - 5
Balance at 30 June 2024 - Unaudited 4,261 21 (2,578) 1,704
Condensed Consolidated Statement of Cash Flows
For the six months ended 30 June 2024
6 months ended 6 months ended
30 June 2024 Unaudited 30 June 2023 Unaudited
$000 $000
Cash flows from operating activities
Operating loss (306) (261)
Adjusted for:
Share based payment charge 5 40
Directors' fees paid in shares 122 111
Depreciation and amortisation 6 5
Unrealised foreign exchange change (1) 2
Net cash flow before changes in working capital (174) (103)
Adjusted for:
Movement in payables 102 (225)
Movement in receivables (23) 8
Net cash flow from operating activities (95) (320)
Investing activities
Exploration expenditure (91) (21)
Net cash flow from investing activities (91) (21)
Cash flow from financing activities
Issue of share capital (net of costs) 248 341
Net cash flow from financing activities 248 341
Net change in cash and cash equivalents during the year/period 62 -
Cash and cash equivalents at beginning of the period 2 12
Cash and cash equivalents at end of the period 64 12
Notes to the condensed consolidated interim financial information
1. GENERAL INFORMATION
Hamak Gold Ltd ("Company") was incorporated on 6 May 2021 and was incorporated
under the BVI Business Companies Act, 2004 (as amended) of the British Virgin
Islands with Company number 2062435. The Company is limited by shares. The
Company's registered office is Pasea Estate, P.O. Box 958, Road Town, Tortola,
VG1110, BVI.
The Company is a public limited company, which is listed on the Standard
Listing of the London Stock Exchange. The principal activity of the Company is
mineral exploration.
The Company together with its wholly owned subsidiary Hamak Gold Limited
(Liberia) is referred to as the Group.
2. BASIS OF PREPARATION
The consolidated interim financial statements for the six months ended 30 June
2024 have been prepared in accordance with the requirements of IAS 34 "Interim
Financial Statements". The interim financial statements should be read in
conjunction with the annual financial statements for the year ended 31
December 2023, which have been prepared in accordance with the UK-adopted
International Accounting Standards and as applied in accordance with the
provisions of the applicable law. The report of the auditors on those
financial statements was unqualified.
The interim financial statements of the Group are unaudited financial
statements for the six months ended 30 June 2024 have not been audited or
reviewed by the Group's auditors. The financial statements have been prepared
under the historical cost convention. The consolidated financial statements
are presented in United States Dollars ($), which is the Group's functional
and presentation currency.
Comparatives
The comparatives presented are for the unaudited 6 months period ended 30 June
2023 for the Condensed Consolidated Statement of Comprehensive Income,
Condensed Consolidated Statement of Changes in Equity, Condensed Consolidated
Statement of Cash Flows and for the audited year ended 31 December 2023 for
the Condensed Consolidated Statement of financial Position and Condensed
Consolidated Statement of Changes in Equity.
Going concern
The Company is at an early stage in progressing its exploration assets and has
limited overhead costs. Funds raised from the IPO and subsequent share
placements have been used primarily to fund exploration work on its licences
in Liberia. In April 2024 the Company raised £200,000 before expenses by the
placement of new shares. Following the period end the Company entered into an
investment agreement with Vela Technologies plc ("Vela") whereby the Company
received 2,424,242,424 ordinary shares in Vela in return for the issue of
£300,000 of Hamak unsecured convertible loan notes of £1 each ("CLNs").
The notes are redeemable after 24 months with interest accruing at 10% per
annum. Vela is subject to a 6-month lock in period during which no
conversion of the loan notes is allowed. A conversion notice of the loan notes
can be issued by Vela any time between 6 months and maturity, The conversion
price will be the lower of £0.03 or a 25% discount to the five-day VWAP
immediately prior to conversion. Any accrued interest will be payable in cash
on the conversion date. At the date of this report the Company had sold 221.6
million Vela shares and raised £17,361 before costs and intends to sell down
its holding in Vela over time and in an orderly manner to realise further cash
for ongoing exploration costs and general working capital.
The Directors have a reasonable expectation that the Company will be able to
raise sufficient funds in order to meet planned expenditure for at least 12
months from the date of approval of these interim consolidated financial
statements and therefore the interim consolidated financial statement have
been prepared on a going concern basis.
3. SIGNIFICANT ACCOUNTING POLICIES
In preparing these condensed consolidated financial statements, the Group's
accounting policies were consistent with those applied to the Group's
consolidated financial statements for the year ended 31 December 2023.
4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
The preparation of condensed interim financial statements requires management
to make estimates and assumptions that affect the reported amounts of assets
and liabilities at the end of the reporting period. Estimates and judgements
are continually evaluated based on historical experience and other factors,
including expectations of future events that are believed to be reasonable
under the circumstances. In the future, actual experience may differ from
these estimates and assumptions.
The judgements, estimates and assumptions applied in the condensed interim
financial statements, including the key sources of estimation uncertainty,
were the same as those applied in the Group's last annual financial statements
for the year ended 31 December 2023.
5. BUSINESS AND GEOGRAPHICAL REPORTING
The Group's chief operating decision maker is considered to be the executive
directors (the 'Executive Board'). The Executive Board evaluates the
financial performance of the Group. During the period the Group had one
activity only. The whole of the value of the Group's net assets was
attributable to mineral exploration.
6. LOSS PER SHARE
Basic earnings per share is calculated by dividing the loss attributable to
equity holders of the Company by the weighted average number of ordinary
shares in issue during the period.
6 months ended 30 June 2024 6 months ended 30 June 2023
$000 $000
Loss from continuing operations attributable to equity holders of the company
(306) (261)
Weighted average number of ordinary shares in issue
77,441,274 44,964,228
Basic and fully diluted loss per share from continuing operations in USD
(0.004) (0.006)
7. PROPERTY, PLANT AND EQUIPMENT
Plant and Equipment
Total
$000 $000
Cost
At 1 January 2024 41 41
Additions - -
At 30 June 2024 41 41
Cost
At 1 January 2023 41 41
Additions - -
At 31 December 2023 41 41
Accumulated Depreciation
At 1 January 2024 18 18
Depreciation charge 6 6
At 30 June 2024 24 24
Accumulated Depreciation
At 1 January 2023 8 8
Depreciation charge 10 10
At 31 December 2023 18 18
Net book value
At 30 June 2024 17 17
At 31 December 2023 23 23
8. INTANGIBLE ASSETS
Mineral
Properties Licences Total
$000 $000 $000
Cost
At 1 January 2024 1,092 863 1,955
Additions 91 - 91
At 30 June 2024 1,183 863 2,046
Cost
At 1 January 2023 618 863 1,481
Additions 474 - 474
At 31 December 2023 1,092 863 1,955
Accumulated Amortisation
At 1 January 2024 - - -
Amortisation charge - - -
At 30 June 2024 - - -
Accumulated Amortisation
At 1 January 2023 - - -
Amortisation charge - - -
At 31 December 2023 - - -
Net book value
At 30 June 2024 1,183 863 2,046
At 31 December 2023 1,092 863 1,955
9. CASH AND CASH EQUIVALENT
6 months ended 30 June 2024 Year ended 31 December 2023
Unaudited Audited
$000 $000
Cash at bank 64 2
64 2
10. SHARE CAPITAL
Number of ordinary shares of nil par value
Share Share premium
$000
capital
$000
Total as at 1 January 2023 39,703,944 - 2,758
Share issue - placing 6,750,078 - 125
Share issue - directors fees 1,745,221 - 187
Share issue - settlement of contracts 269,967 - 30
Share issue - performance shares exercised 953,107 - -
Share issue - costs - - (29)
At 31 December 2023 50,563,522 - 3,805
Share issue - placing 16,000,000 - 249
Share issue - directors & management fee shares 11,392,381 - 177
Share issue - in lieu of services provided 3,120,000 - 49
Share issue - costs - - (19)
Total as at 30 June 2024 81,075,903 - 4,261
For a more detailed description of the share capital movements for 2023 refer
to the audited financial statements for the year ended 31 December 2023
Placing
In April 2024 the Company raised gross proceeds of £200,000 ($249,080)
issuing 16,000,000 new ordinary shares at £0.0125 per share.
Directors and management fees
During the period 11,392,381 new ordinary shares were issued to directors and
management of the Company at £0.0125 per share in lieu of fees.
Peterhouse fees
During the period 3,120,000 new ordinary shares were issued to Peterhouse
Capital Limited at £0.0125 per share in lieu of fees services and for
commissions on the April 2024 placing.
Reconciliation of movement of share capital to the movements in the cashflow
statement
Share Share premium
$000
capital
$000
At 31 December 2023 - 3,805
Share capital issued for cash net of issue costs - 248
Share capital issued in settlement of contractual obligations - 208
Total as at 30 June 2024 - 4,261
11. SHARE BASED PAYMENTS
Performance Rights
At 30 June 2024, the Company had outstanding performance rights to subscribe
for ordinary shares as follows:
Weight average Expiry date At 01/01/24 expired or At 30/06/2024
exercise price lapsed
Issued
Nil 07/07/2032 953,107 - - 953,107
953,107 - - 953,107
Information on the inputs and fair value calculations relating to the
performance rights are shown in the audited financial statements for the year
ended 31 December 2023.
12. RELATED PARTY TRANSACTIONS
During the period certain directors were awarded Ordinary Shares in the
Company. Further details can be found in note 10, Share Capital.
13. EVENTS AFTER THE REPORTING DATE
On 16 July 2024, the Company entered into an investment agreement with Vela
whereby the Company received 2,424,242,424 ordinary shares in Vela in return
for the issue of £300,000 of Hamak unsecured convertible loan notes of £1
each ("CLNs"). The notes are redeemable after 24 months with interest
accruing at 10% per annum. Vela is subject to a 6-month lock in period
during which no conversion of the loan notes is allowed. A conversion notice
of the loan notes can be issued by Vela any time between 6 months and
maturity, The conversion price will be the lower of £0.03 or a 25% discount
to the five-day VWAP immediately prior to conversion. Any accrued interest
will be payable in cash on the conversion date. At the date of this report the
Company had sold 221.6 million Vela shares and raised £17,361 before costs.
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