REG - Hummingbird Res. - 2021 Audited Annual Results
27/05/2022 07:00
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RNS Number : 0536N Hummingbird Resources PLC 27 May 2022
Hummingbird Resources plc / Ticker: HUM / Index: AIM / Sector: Mining
27 May 2022
Hummingbird Resources plc
("Hummingbird" or the "Company")
2021 Audited Annual Results
Hummingbird Resources plc (AIM: HUM) announces its audited financial results
for the year ended 31 December 2021.
Financial Results:
· Sales of US$156.6 million (2020: US$181.7 million) were generated
from 87,553 ounces ("oz") of gold sold in 2021 at an average price of
US$1,788/oz (2020: 104,174 oz sold at an average price of $1,745/oz), with
additional US$6.2 million (2020: US$3.4 million) revenue generated from sale
of SMO gold
· EBITDA of US$28.2 million (2020: US$75.2 million)
· Adjusted EBITDA(1) of US$18.6 million (2020: US$62.3 million)
· Diluted loss per share of US$ 2.78 cents (2020: earnings per
share of US$ 5.02 cents)
· Total bank debt of US$61.8 million with US$13.2
million capital repaid in the year
· Net debt of US$21.0 million(2) (2020: net cash $1.5
million(2))
(1 )(Adjusted EBITDA Earnings before interest, tax, depreciation and
amortisation, effect of impairment charges, foreign currency translation
gains/losses and other non-recurring expense adjustments but including IFRS 16
lease payments.)
(2)( Net debt/cash including the value of gold inventory.)
Operational Results
· 87,558 oz of gold poured in 2021 (2020: 101,069 oz)
· All in Sustaining Cost ("AISC") of US$1,536/oz in 2021 (2020:
US$1,147/oz)
· Total Recordable Injury Frequency Rate ("TRIFR") of 0.59 (2020:
0.82)
· Company Reserves increased to c.1.12 million ounces ("Moz") in
2021, a 438,600 oz increase to the previous Company reserve statement
in October 2019 of 672,000 oz
· Completion of c.68.000 metre drilling programme in 2021 at both
Yanfolila, Mali and Kouroussa, Guinea
Dan Betts, CEO of Hummingbird, commented:
"We set out in 2021 to grow our business by developing our portfolio of assets
to become a multi-asset, multi-jurisdiction gold producer, expanding our
Resources and Reserves through exploration and implementing improved ESG
initiatives.
With the signing of the mining licenses in May 2021 for our Kouroussa gold
mine in Guinea, to commencement of construction in early 2022, we are well on
our way to achieving our strategic goal of being a multi-asset producer and
more than doubling our production profile in 2023/24.
In relation to our Dugbe gold project, our earn-in partners Pasofino made
material progress in 2021 towards completion of a definitive feasibility study
("DFS"). While we have achieved significant growth across our business, our
Yanfolila gold mine in Mali underperformed in the latter part of 2021. We have
taken steps to address these issues, with a significant focus on improving
productivity and predictability at Yanfolila with several optimisation and
mitigation workstreams in place.
As we look to 2022, we remain focused on delivering our vision for Hummingbird
with significant initiatives across our portfolio to create value and build a
Company that we and stakeholders across the business can be proud of."
For further information, please visit www.hummingbirdresources.co.uk
(http://www.hummingbirdresources.co.uk/) or contact:
Daniel Betts, CEO Hummingbird Resources plc Tel: +44 (0) 20 7409 6660
Thomas Hill, FD
Edward Montgomery, CSO & ESG
James Spinney Strand Hanson Limited Tel: +44 (0) 20 7409 3494
Ritchie Balmer Nominated Adviser
James Asensio Canaccord Genuity Limited Tel: +44 (0) 20 7523 8000
Thomas Diehl Broker
Bobby Morse Buchanan Tel: +44 (0) 20 7466 5000
Ariadna Peretz Financial PR/IR Email: HUM@buchanan.uk.com
James Husband
Notes to Editors:
Hummingbird Resources (AIM: HUM) is a leading multi-asset, multi-jurisdiction
gold production, development and exploration Company and member of the World
Gold Council ("WGC"). Hummingbird's vision is to continue to grow its asset
base, producing profitable ounces, while continuing to focus on its
Environmental, Social & Governance ("ESG") policies and practices. The
Company currently has two core gold projects, the producing Yanfolila Gold
Mine in Mali, and the Kouroussa gold development project in Guinea.
Further, the Company has a controlling interest in the Dugbe Gold
Project in Liberia that is being developed by Pasofino Gold Limited through
an earn-in agreement.
Chairman's Statement
Last year, I wrote of the significant challenges the Company and its employees
had faced and successfully navigated. 2021 was another year of overcoming
challenges, which included production disruptions and headwinds relating to
COVID-19, together with social and political volatility in both Mali and
Guinea. This has translated into Yanfolila's operational performance in 2021
being below that of the previous year. These challenges brought forward
initiatives to improve the long-term viability of our production assets, which
included strengthening our management team and expanding our growth platforms,
in particular at Kouroussa in Guinea. As a Board, we are confident that the
steps taken to address these issues have attended to the root causes of the
disruptions faced by the Company. In addition, our strategy of diversifying
away from being a single producing asset at Yanfolila remains central to
creating a more resilient Company.
Despite operational challenges, the Company made significant progress in 2021
towards becoming a multi-asset, multi-jurisdiction gold producer with some key
outcomes achieved, including amongst others:
· We have financed Kouroussa and have commenced its construction,
setting us on a path to becoming a multi-asset, multi-jurisdiction gold
producer in 2023
· We have expanded the mine life at Yanfolila and Kouroussa through
targeted exploration drilling, with Company Reserves increasing to over 1
million oz, with further growth anticipated at the next Company Resources and
Reserves statement due in June 2022
· Our earn-in partners Pasofino Gold Limited ("Pasofino") at Dugbe,
Liberia, made material progress towards delivering a DFS
· Progress on our ESG initiatives, as highlighted by the Company
successfully achieving in November 2021 our year 2 independent audit assurance
on the WGC responsible gold mining principles ("RGMPs") and progress towards
full conformance in 2022
With operational improvements being embedded at Yanfolila and with the
development of the Kouroussa mine in Guinea, the Company remains on track to
being a multi-asset, multi-jurisdiction gold producer.
ESG continues to be a significant focus for the Company. At Kouroussa, we are
looking to embed technologies to lower our overall mining carbon footprint,
such as a solar plant and heat recovery systems. Further, as detailed above,
we are looking to achieve full conformance in 2022 of the WCG RGMPs, which we
believe is not just an ESG initiative but one that very much contributes to
improving the overall effectiveness of the Company.
Throughout the year, despite its challenges, we have remained true to our
values and focused on our long-term strategy of becoming a multi-asset,
multi-jurisdiction gold producer. Though we have faced some difficult
challenges in 2021, we are focusing on operational improvements and delivering
future growth platforms for the Company to generate returns for our long-term
shareholders, whose support is greatly appreciated by the Board.
Furthermore, I note that this will be my last letter as Chairman. Looking back
to when I started in the role we have clearly come a long way - acquired,
financed, built and operated Yanfolila, acquired, financed and commenced
building Kouroussa, and developed a way forward for Dugbe.
I would like to take this opportunity to thank my fellow directors, senior
management and employees for their support and efforts over the past eight
years. Your professionalism, resilience and tenacity are much appreciated.
Russell King
Non-Executive Chairman
CEO's Statement
2021 in Review:
This past year we set ourselves several key objectives to fulfilling our
strategic objective of becoming a multi-asset, multi-jurisdiction gold
producer, which included; the development of our second producing gold mine,
Kouroussa in Guinea; the extension of Life of Mine ("LOM") across our asset
portfolio through a material uplift in discovered gold ounces through
exploration; continuing to improve upon our ESG initiatives; and achieve
better overall operational performance at Yanfolila in Mali.
In Guinea, we made material strides towards our strategic aim of becoming a
multi-mine Company with the awarding of our Kouroussa mining licenses in May.
Subsequently, we completed the arrangements for a group financing facility of
c.US$100 million from Coris Bank International in October, with the
commencement of construction in early 2022. Kouroussa's construction continues
to advance rapidly towards the scheduled first gold pour by the end of Q2
2023.
At Dugbe in Liberia, our earn-in partner Pasofino has made solid progress
advancing the DFS of the project, with results expected to be issued in Q2
2022. This will take Dugbe from an exploration asset to an economically viable
and bankable gold mine which, once delivered, will also mark a major milestone
for the Company. This project, which was the original founding asset of the
Company, is one of the largest undeveloped gold projects in West Africa, with
over 3.3Moz of gold in the Measured and Indicated category and our Board looks
forward to further progress on this asset to unlock value to stakeholders.
In 2021 the Company invested heavily in our drilling programmes. The resulting
c.68,000 m of drilling at Yanfolila and Kouroussa continues to provide
increased confidence of LOM extension potential at both operations. The 2021
drilling data will be incorporated in our updated Company Resources and
Reserves statement scheduled for release in Q2 2022, with the aim to build
upon our Reserve statement announced in November, which showed an increase in
Reserves to c.1.12Moz, including a maiden Reserve at Kouroussa. Additionally,
this work highlights the potential for underground mines at both Yanfolila and
Kouroussa, which will become an increasingly important part of the Company's
future as these mines develop.
In terms of ESG, progress was made in 2021. At Kouroussa, we committed to
embedding sustainable technologies into our process design, such as a solar
power plant and heat recovery systems, which will lower our overall carbon
footprint at the operation. Additionally, we finalised an updated
Environmental, Social and Impact Assessment ("ESIA") study at Kouroussa to
ensure our practices are to a high international standard and in line with the
WGC RGMPs. Another key ESG focus for 2021 for the Company was to successfully
achieve year 2 independent audit assurance on the WGC RGMPs and progress
towards full conformance in 2022. This was achieved and reported on in
November, with more details in our Sustainability Report section of this
report.
Our Single Mine Origin ("SMO") initiative has gathered momentum during the
year with several jewellers and miners showing interest in adopting the
process. This initiative gives us the opportunity to showcase mining as the
force for good that we at Hummingbird fundamentally believe it is. It gives us
the opportunity to be a part of a movement that "future proofs" mining in a
world of increased scrutiny and showcases responsible mines for all the
valuable work that they do. I believe this initiative has the scope to
transcend our Company and be a driver for change for the positive impact the
mining industry delivers more broadly.
However, these key achievements in 2021 were overshadowed by the overall
underperformance of the Yanfolila mine. This performance has damaged our share
price and financial performance, and it is our highest priority to ensure
Yanfolila delivers better overall operational performance going forward. As
such, we have taken significant steps to return operational performance to
where it should be. Central to these changes has been the appointment of a
group Chief Operating Officer ("COO") and remediation initiatives with our
contract miner, whose excavator fleet underperformed in the latter part of
2021. We understand that despite the opportunities and prospects the Company
has developed, these are worth little if we do not deliver reliable
operational performance. The focus over the past six months has therefore been
to significantly increase the operational efficiency and the availability of
the mining fleet and ensure that the mining is in step with the quality of our
processing ability.
2022 Outlook:
As we look to 2022, we have several areas of focus. At Kouroussa, with
construction rapidly advancing and major civil works now underway, the key
priority for the project management team is to deliver the project on time, on
budget and safely, with zero tolerance towards unsafe behaviours and
practices. The macro-environment in terms of inflationary pressure and
political instability in West Africa provides a challenging backdrop, and as
we move through the year, we will increasingly focus on operational readiness
so that the business of mining effectively and efficiently is in place when
mining begins in 2023 and beyond.
At Dugbe, with a DFS to be issued shortly from our earn-in partner Pasofino,
we will reach a significant milestone on that project for the Company. We are
cognisant post the DFS that we have the opportunity to deliver meaningful
shareholder value on Dugbe, and we will be carefully reviewing the best
options for the Company in terms of taking this project forward.
We understand the critical need to show operational improvement at Yanfolila
and one that is a key focus area for the year ahead, with a material amount of
management time being spent on increasing productivity. Work has already begun
with the implementation of several initiatives focused on stabilising our
production, including the delivery and commissioning of additional excavators,
and the essential maintenance of the processing plant, which will aim to
deliver a more disciplined and predictable state of operations.
Our exploration objectives in 2022 are to finalise the analysis and delivery
of our updated Company Resources and Reserves statement and extend the LOM of
our assets. We will also look to continue our LOM extension journey by further
analysing our geology base and developing additional exploration campaigns for
the future, particularly at Kouroussa, where a large core re-logging program
is currently underway.
In relation to ESG, it is core to our future for the Company, and we aim to
continue the improvement of our overall ESG processes and initiatives at the
corporate and site levels and to achieve a successful Year 3 full compliance
independent audit assurance report on the WGC RGMPs by year end.
Furthermore, I note that Russell King has given notice of his intention to
resign as Non-Executive Chair of the Company at or shortly following the AGM.
The Company is actively engaged in the search for a replacement Non-Executive
Chair with further updates to be provided as and when appropriate. On behalf
of the board, I would like to take this opportunity to thank Russell for his
valuable guidance and support to the Company and me personally over the past
eight years.
Lastly above all else, we will continue to strive to build a Company that we
can all be proud of as shareholders, employees, founders and other
stakeholders alike. Despite the many challenges the Company has faced, there
is no loss of enthusiasm from your management team, which remains fully
committed to the vision of building a Company that will have a positive impact
for the mining industry at large.
Dan Betts
Chief Executive Officer
Consolidated Statement of Comprehensive Income
For the year ended 31 December 2021
2021 2020
$'000 $'000
Continuing operations
Revenue 162,777 185,072
Production costs (113,606) (93,975)
Amortisation and depreciation (38,317) (41,367)
Royalties and taxes (6,297) (6,747)
Cost of sales (158,220) (142,089)
Gross profit 4,557 42,983
Share based payments (1,459) (2,081)
Other administrative expenses (10,263) (8,928)
Operating (loss)/profit (7,165) 31,974
Finance income 4,071 2,014
Finance expense (6,003) (9,288)
Share of joint venture loss (46) (17)
Reversals in impairment of financial assets 108 397
(Losses)/gains on financial assets and liabilities measured at fair value (3,134) 1,203
(Loss)/profit before tax (12,169) 26,283
Tax 1,617 (1,135)
(Loss)/profit for the year (10,552) 25,148
Attributable to:
Equity holders of the parent (10,908) 19,022
Non-controlling interests 356 6,126
(Loss)/profit for the year (10,552) 25,148
(Loss)/earnings per share (attributable to equity holders of the parent)
Basic ($ cents) (2.78) 5.35
Diluted ($ cents) (2.78) 5.02
Consolidated Statement of Financial Position
As at 31 December 2021
2021 2020
$'000 $'000
Assets
Non-current assets
Intangible exploration and evaluation assets 91,287 75,574
Intangible assets software 235 204
Property, plant and equipment 144,591 150,247
Right of use assets 35,986 13,797
Investments in associates and joint ventures 129 175
Financial assets at fair value through profit or loss 3,530 7,721
Deferred tax assets 3,868 684
279,626 248,402
Current assets
Inventory 13,148 20,352
Trade and other receivables 25,152 12,724
Unrestricted cash and cash equivalents 32,571 6,552
Restricted cash and cash equivalents 4,168 4,516
75,039 44,144
Total assets 354,665 292,546
Liabilities
Non-current liabilities
Borrowings 61,812 -
Lease liabilities 20,962 2,380
Deferred consideration 4,627 5,402
Other financial liabilities 9,092 6,836
Provisions 21,644 16,125
118,137 30,743
Current liabilities
Trade and other payables 33,708 39,440
Lease liabilities 13,496 10,894
Other financial liabilities 15,000 15,000
Provisions 611 -
Borrowings - 13,208
62,815 78,542
Total liabilities 180,952 109,285
Net assets 173,713 183,261
Equity
Share capital 5,814 5,344
Share premium 17,425 488
Shares to be issued - 17,407
Retained earnings 140,342 150,246
Equity attributable to equity holders of the parent 163,581 173,485
Non-controlling interest 10,132 9,776
Total equity 173,713 183,261
Consolidated Statement of Cash Flows
For the year ended 31 December 2021
2021 2020
$'000 $'000
Net cash inflow from operating activities 22,703 66,256
Investing activities
Asset purchase, net of cash acquired - (35)
Purchases of intangible exploration and evaluation assets (9,992) (2,601)
Purchases of property, plant and equipment (22,295) (18,136)
Pasofino funding 10,141 5,559
Pasofino funding utilisation (10,946) (4,673)
Purchase by non-controlling interest - 1,883
Sale/(purchase) of shares in other companies 2,538 (393)
Interest received - 11
Net cash used in investing activities (30,554) (18,385)
Financing activities
Exercise of share options - 532
Lease principal payments (13,201) (12,663)
Lease interest payments (819) (1,201)
Loan interest paid (721) (2,547)
Loans repaid (13,278) (29,252)
Loan drawdown 66,365 -
Commissions and other fees paid (5,413) (571)
Net cash generated from/ (used in) financing activities 32,933 (45,702)
Net increase in cash and cash equivalents 25,082 2,169
Effect of foreign exchange rate changes 589 370
Cash and cash equivalents at beginning of year 11,068 8,529
Cash and cash equivalents at end of year 36,739 11,068
Consolidated Statement of Changes in Equity
For the year ended 31 December 2021
Share Share Retained Total equity attributable to the parent Non-controlling interest Total
capital premium earnings $'000 $'000 $'000
$'000 Shares to be issued $'000 $'000
$'000
Balance at 1 January 2020 5,301 - 129,952 135,253 3,650 138,903
-
Comprehensive income for the year:
Profit for the year - - - 19,022 19,022 6,126 25,148
Total comprehensive income for the year - - - 19,022 19,022 6,126 25,148
Transactions with owners in their capacity as owners:
Shares to be issued as consideration in asset purchase - 17,407 - - 17,407 - 17,407
Total transactions with owners in their capacity as owners - 17,407 - - 17,407 - 17,407
Share based payments 43 - 488 1,272 1,803 - 1,803
As at 31 December 2020 5,344 17,407 488 150,246 173,485 9,776 183,261
Comprehensive income for the year:
(Loss)/profit for the year - - - (10,908) (10,908) 356 (10,552)
Total comprehensive income for the year - - - (10,908) (10,908) 356 (10,552)
Transactions with owners in their capacity as owners:
Shares issued as consideration in asset purchase 470 16,937 - - - -
(17,407)
Total transactions with owners in their capacity as owners 470 (17,407) 16,937 - - - -
Share based payments - - - 1,004 1,004 - 1,004
As at 31 December 2021 5,814 - 17,425 140,342 163,581 10,132 173,713
Share capital Retained earnings
The share capital comprises the issued ordinary shares of the Company at par Cumulative net gains and losses recognised in the consolidated statement of
value. comprehensive income.
Non-controlling interest
Share premium
The share premium comprises the excess value recognised from the issue of The non-controlling interest relates to the 20% stake the Government of Mali
ordinary shares for consideration above par value. has in Société Des Mines De Komana SA ("SMK") which owns and operates the
Yanfolila Mine.
Notes to the Consolidated Financial Statements
1. General information
Hummingbird Resources PLC is a public limited company with securities traded
on the AIM market of the London Stock Exchange. It is incorporated and
domiciled in the United Kingdom and has a registered office at 49-63 Spencer
Street, Hockley, Birmingham, West Midlands, B18 6DE.
The nature of the Group's operations and its principal activities are the
exploration, evaluation, development, and operating of mineral projects,
principally gold, focused currently in West Africa.
2. Basis of preparation
The preliminary announcement does not constitute statutory financial
statements for the years ended 31 December 2021 and 31 December 2020.
The financial information for the year ended 31 December 2021 has been
extracted from the Company's audited financial statements which were approved
by the Board of Directors on 26 May 2022 and which, if adopted by the members
at the Annual General Meeting, will be delivered to the Registrar of Companies
for England and Wales. The report of the auditor on the 31 December 2021
financial statements was unqualified but contained a material uncertainty
paragraph relating to going concern and did not contain a statement under
Section 498(2) or Section 498(3) of the Companies Act 2006.
Statutory accounts for the year ended 31 December 2020 have been delivered to
the Registrar of Companies. The Auditor has reported on those accounts; their
report was unqualified and did not contain a statement under Section 498 (2)
or Section 498(3) of the Companies Act 2006.
3. Going Concern
The financial position of the Group, its cash flows, liquidity position and
borrowing facilities are set out in the Financial Review. At 31 December 2021,
the Group had cash and cash equivalents of $36.7 million and total borrowings
of $61.8 million. Details on the Group's borrowings are set out in note 17 to
the financial statements.
The Group has prepared cash flow forecasts based on estimates of key variables
including production, gold price, operating costs, capital expenditure through
to December 2023 that supports the conclusion of the Directors that they
expect sufficient funding should be available to meet the Group's anticipated
cash flow requirements to this date.
These cashflow forecasts are subject to several risks and uncertainties, in
particular the ability of the Group to achieve the planned levels of
production and the recent higher gold prices being sustained. The Board
reviewed and challenged the key assumptions used by management in its going
concern assessment, as well as the scenarios applied and risks considered,
including the risks associated with the recent change in governments in Mali
and Guinea and subsequent sanctions on Mali, the sanctions on Russia as well
as COVID-19.
The biggest material uncertainty and risk remains ounces produced and whether
the current mine plan can be achieved, mining contractor equipment
performance, the impact of COVID-19, and impact of the latest change in
government and resulting sanctions in Mali and sanctions on Russia, which are
also having a logistical impact on the Group. Where additional funding may be
required, the Group believes it has several options available to it, including
but not limited to, use of the overdraft facility, cost reduction strategies,
selling of non-core assets, raising additional funds from current investors
and debt partners.
The Board also considered sensitivities to those cash flow scenarios
(including where production is lower than forecast and gold prices lower than
current levels) which would require additional funding. Should this situation
arise, the Directors believe that they have several options available to them,
such as use of the current overdraft facility, obtaining additional funding,
delaying expenditures, sale of non-core assets, which would allow the Group to
meet its cash flow requirements through this period, however, there remains a
risk that the Group may not be able to achieve these in the necessary
timeframe.
Based on its review, the Board has a reasonable expectation that the Group has
adequate resources to continue operating for the foreseeable future and hence
the Board considers that the application of the going concern basis for the
preparation of the Financial Statements was appropriate. However, the risk of
lower-than-expected production levels, timing of VAT offsets and receipts,
increased fuel costs and potential disruptions to supply chain and the ability
to secure any potential required funding at date of signing of these financial
statements, indicates the existence of a material uncertainty which may cast
significant doubt on the Group's ability to continue as a going concern.
Should the Group be unable to achieve the required levels of production and
associated cashflows, defer expenditures or obtain additional funding such
that the going concern basis of preparation was no longer appropriate,
adjustment would be required including the reduction of balance sheet asset
values to their recoverable amounts and to provide for future liabilities
should they arise
4. (Loss)/profit per ordinary share
Basic (loss)/profit per ordinary share is calculated by dividing the net
(loss)/profit for the year attributable to ordinary equity holders of the
parent by the weighted average number of ordinary shares outstanding during
the year.
The calculation of the basic and diluted (loss)/profit per share is based on
the following data:
2021 2020
$'000 $'000
(Loss)/profit
(Loss)/profit for the purposes of basic (loss)/profit per share being net (10,908) 19,022
(loss)/profit attributable to equity holders of the parent
2021 2020
Number of shares Number Number
Weighted average number of ordinary shares for the purposes of basic 392,676,809 355,380,149
(loss)/profit per share
Weighted number of shares to be issued as part of asset purchase - 11,685,100
Adjustments for share options and warrants 17,166,492 11,835,883
Weighted average number of ordinary shares for the purposes of diluted 409,843,301 378,901,132
(loss)/profit per share
2021 2020
(Loss)/profit per ordinary share $ cents $ cents
Basic (2.78) 5.35
Diluted (2.78) 5.02
At the reporting date there were 19,984,137 (2020: 50,761,957) potentially
dilutive ordinary shares. For the year ended 31 December 2021, because there
is a reduction in diluted loss per share due to the loss-making position,
therefore there is no difference between basic and diluted loss per share.
5. Net debt reconciliation
At 1 Foreign Amortisation At 31 December
January Cash flow exchange of issue costs/other (1) 2021
2021 $'000 movement $'000 $'000
$'000 $'000
Unrestricted cash 6,552 25,082 937 - 32,571
Restricted cash 4,516 - (348) - 4,168
Total cash & cash equivalents 11,068 25,082 589 - 36,739
Borrowings (13,208) (49,366) 24 738 (61,812)
Lease liabilities (13,275) 13,201 - (34,384) (34,458)
Net debt (15,415) (11,083) 613 (33,646) (59,531)
(1) Included within the other category on lease liabilities is $39,711,000
additions to liabilities as well as $5,271,000 forfeiture of liabilities as a
result of changing mining contractors in Mali. Included within the other
category for borrowings is $1 million of unpaid legal fees at year end offset
by $261,000 issue costs amortisation.
6. Borrowings
New Coris Senior Coris Senior Coris Second Total
Loan Facility Loan Facility Ball Mill Facility Borrowings
$'000 $'000 $'000 $'000
At 1 January 2021 - 12,308 900 13,208
Loan drawdown 66,365 - - 66,365
Issue costs arising during the year (4,711) - - (4,711)
Issue costs amortised in the year - 261 - 261
Interest charged during the year - 271 - 271
Principal & interest repayments during the year - (12,657) (900) (13,557)
Foreign exchange loss during the year 158 (183) - (25)
Total borrowings at 31 December 2021 61,812 - - 61,812
Analysed as:
Current - - - -
Non-current 61,812 - - 61,812
New Coris Senior Loan Facility
On 4 November 2021, the Group's subsidiary, Société des Mines de Komana SA
("SMK") entered into a senior secured term debt facility with Coris Bank
International ("Coris") for CFA 38,500,000,000 (approximately $70,000,000
before any fees). In December 2021, the full amount was drawn down. The debt
facility has the following key terms:
- A 4 year term.
- Interest at 8.5% per annum (payable quarterly).
- Principal deferral period of 18 months from first draw down, payable
quarterly thereon.
Further the Group's subsidiary, Kouroussa Gold Mine SA ("KGM") entered into a
senior secured term debt facility with Coris Bank International ("Coris") for
$30,000,000. This amount was undrawn as at 31 December 2021. The debt facility
has the same terms as reflected above.
Coris Senior Loan Facility
On 11 April 2017, the Group's subsidiary, Société des Mines de Komana SA
("SMK") entered into a senior secured term debt facility with Coris Bank
International ("Coris") for CFA 37,000,000,000 (approximately $60,000,000). On
10 April 2017 SMK drew down the CFA 15,500,000,000 (approximately $25,000,000)
and on 4 July 2017 drew down the remaining CFA 21,500,000,000 (approximately
$35,000,000). The debt facility has the following key terms:
- A 4 year term.
- Interest at 9% per annum (payable monthly).
- Principal deferral period of 12 months from first draw down, payable monthly
thereon.
This loan was fully repaid by June 2021.
Coris Second Ball Mill Facility
On 26 November 2019, following approval for the construction of the Second
Ball Mill at the Yanfolila Mine, the Group's subsidiary, SMK, entered into a
senior secured term debt facility with Coris for CFA 5,500,000,000
(approximately $9,600,000). On 28 December 2020 SMK drew down the balance of
the facility. The debt facility has the following key terms:
- A 2 year term.
- Interest at 9% per annum (payable monthly).
- Principal deferral period of 12 months from first draw down, payable monthly
thereon.
This loan was fully repaid by January 2021.
Coris Overdraft Facility
On 18 November 2019, the Group's subsidiary, SMK entered into an overdraft
facility with Coris for CFA 5,500,000,000. This amount was later increased to
CFA 11,200,000,000 (approximately $20,000,000 at 31 December 2021 exchange
rate), to provide additional working capital flexibility. This facility was
renewed on 18 December 2020 and then lately on 27 December 2021. The Coris
Overdraft Facility carries an interest rate of 9% per annum and remains
available twelve months from date of renewal.
Security for these borrowings has been granted to Coris over the assets of SMK
and KGM, as well as the share capital of SMK and KGM, a parent company
guarantee, and restricted cash held in an escrow account.
The Group records and measures borrowings at amortised cost, using the
effective interest rate method.
7. Availability of Accounts
The audited Annual Report and Financial Statements for the year ended 31
December 2021 and notice of AGM will shortly be sent to shareholders and
published at: www.hummingbirdresources.co.uk
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