REG - Ironveld PLC - Interim results for the 6 months ended 31 Dec 2023
28/03/2024 07:00
For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20240328:nRSb6018Ia&default-theme=true
RNS Number : 6018I Ironveld PLC 28 March 2024
This announcement contains inside information
28 March 2024
IRONVELD PLC
("Ironveld" or the "Company")
Interim Results for the Six Months ended 31 December 2023
Ironveld plc, the owner of a High Purity Iron ("HPI"), Vanadium and Titanium
project located on the Northern Limb of the Bushveld Complex in Limpopo
Province, South Africa (the "Project") is pleased to announce its Interim
Results for the six months ended 31 December 2023 (the "Period").
Highlights
· First sales of metal products including high purity iron and
titanium slag from its Rustenburg smelter to local buyers, however,
operational challenges and modifications delayed anticipated ramp up for the
remainder of 2023
· Directors provided working capital support for the Company with a
facility of up to £500,000 to maintain flexibility of funding
· Continued refurbishment of Rustenburg smelters and commencement
of mining activities
· Removal of rented electrical generators and planned installation
of similar capacity with significantly lower cost
· Smelter has been placed on care and maintenance to minimise costs
and conserve cash until all new generators are installed
· Positive discussions with potential iron powder customers
progressed
· Largest shareholder, Tracarta, agreed to cornerstone a cash
subscription of £450,000 at a premium to the share price, in addition to a
further £550,000 from existing shareholders, to assist with ongoing working
capital requirements
· Dr John Wardle assumed the role of Executive Chairman of the
Company and commenced a full review of strategy, overhead costs and
priorities, with Giles Clarke remaining as a Non-Executive Director
Post Period and Outlook
· Entered into working capital loan facility agreements with
Tracarta, which allowed the Company to draw down up to £375,000 to strengthen
Ironveld's working capital position as discussions for direct institutional
funding progressed. That facility is currently fully drawn.
· Receipt of a non-binding term sheet from a South African based
financial institution regarding the asset level financing of mining and
smelting activities, including the transition to production. The transaction
is subject to further due diligence
· Martin Eales stepped down from the Board, with Executive
Chairman, Dr. John Wardle, taking over his CEO duties on an interim basis
· Ironveld is assessing current funding requirements until a
transaction can be completed
· The Company currently has cash of circa £25,000 (as of 27 March
2024)
John Wardle, Executive Chairman, said: "The Period saw Ironveld undergo
significant changes at Board and Management level. These changes were
necessary to continue to develop the Group operations towards unlocking the
significant value in our assets. The receipt of a Term Sheet from a South
African based financial institution in order to support the financing of
mining and smelting activities at the Project is an important step in that
direction. However the confirmation, quantum and timing of that potential
funding is not yet certain.
"Thank you for your continued support and we look forward to sharing more
positive news flow."
For further information, please contact:
Ironveld plc c/o BlytheRay
John Wardle, Executive Chairman 020 7138 3204
Cavendish Capital Markets Limited (Nomad and Broker) 020 7220 0500
Derrick Lee / Adam Rae
Turner Pope (Joint Broker) 020 3657 0050
Andy Thacker/James Pope
BlytheRay 020 7138 3204
Megan Ray/Tim Blythe
Notes to Editors:
Ironveld (IRON.LN) is the owner of Mining Rights over approximately 28
kilometres of outcropping Bushveld magnetite with a SAMREC compliant ore
resource of some 56 million tons of ore grading 1,12% V2O5, 68,6% Fe2O3 and
14,7% TiO2.
In 2022 Ironveld agreed to acquire and refurbish a smelter facility in
Rustenburg, South Africa, in which it can process its magnetite ore into the
marketable products of high purity iron, titanium slag and vanadium slag. This
transaction became unconditional in March 2023.
Ironveld is an AIM traded company. For further information on Ironveld please
refer to www.ironveld.com (http://www.ironveld.com/) .
Chairman's Statement:
I took over as Chairman from Giles Clarke towards the end of the Period, and
as one of my first points of action, I was tasked with undertaking a full
Group wide review of everything Ironveld related, including strategy, overhead
costs and priorities. Some months later, and having completed this
comprehensive review, I see many areas for improvement within the Company
which must be resolved before sustainable, profitable production can be
achieved.
The Period was one of necessary change, given the failures in delivery we have
experienced over the last year or more. However, it also saw the Company begin
to show the initial signs of positive things to come, as it took its first
steps from developer to producer. This was best demonstrated in late June when
the Company announced first sales of metal products from the Rustenburg
smelter.
Operations were affected by a number of teething and system problems at the
Smelter after achieving first sales, including the need to repair the
granulator and the requirement for additional generator power, which would
delay what we anticipated to be a significant ramp up in production and sales
for the remainder of the year. To combat this, additional rented diesel
generation capacity was installed and the granulator refurbished to a level
where it was performing significantly above expectations.
As part of my comprehensive review of the Company, and with cost saving in
mind, we decided to suspend operations at the Rustenburg smelter until all of
the currently installed electrical generation units could be replaced by
LNG/Diesel dual-fuel units, since the cost of conventional diesel generation
rendered any production uneconomic. Dual-fuel units are inherently more
economical under current conditions in South Africa, however they are still
expensive and the issue around power for the smelting operations has a crucial
impact upon viability.
The Period saw the Company develop its operations in a number of other areas.
A test project to process third party ferro-silicon slag metal was completed
and demonstrated the flexibility of the smelter equipment and potential for
further revenue streams. In addition, during September we formed "IPace", a
DMS Magnetite joint venture with Pace SA, which secured capital funding from
Sable Exploration and Mining for the development of a business to crush, mill
and magnetically separate directly from the Company's mining operations for
direct sale to end users. Pace, which was initially responsible for the
funding of the project, failed to comply with the terms of the agreement and
will be exiting the joint venture. Ironveld and Sable are currently
negotiating the terms of a further investment to complete the DMS plant.
During the Period, the Company completed fundraisings totalling £1.5 million,
in which I participated significantly.
Ensuring we do things responsibly, with the interests of our stakeholders and
local communities at the heart of every decision we make, is of upmost
importance to Ironveld. To this end we endeavour to prioritise employment of
local community members and give preference to local community companies in
terms of work or business opportunities. In terms of our Social Labour Program
we have commitments to support local municipalities in our project area in the
development of water supply schemes, electrification upgrades and roads and
stormwater. In addition, we are establishing schemes to provide student
support, training and bursaries to members of the various host communities.
Financial
The Group recorded a loss before tax of £385,000 (H1 2022: loss of £522,000)
in the period. The Company does not plan to pay a dividend for the six months
ended 31 December 2023.
Post Period End Events
In February 2024, it was announced that we entered into working capital loan
facility agreements with Tracarta, the Company's largest shareholder, which
allowed the Company to draw down up to £375,000. This consisted of a
£250,000 facility through a 12-month extension of the existing agreement and
a new £125,000 facility. Those funds are now fully drawn.
Later in the same month, the Company was able to announce that it received a
non-binding term sheet from a South African based financial institution
regarding the asset level financing of mining and smelting activities at the
project. Through this, we would be able to invest in all Group operations,
including the transition to production of high purity iron powders. This is a
wide-ranging proposal which aims to provide full financing to all planned
activities through to sustained production. However, the provision, quantum
and timing of that potential funding is not yet confirmed, since the
transaction is subject to further due diligence and other internal approvals,
and there is therefore no certainty that a transaction will be concluded. I
believe that this process may well take several more months to complete, and
in the meantime the Company has both current liabilities to service and
requires capital to continue development of projects outside the asset level
institutional funding described above. Accordingly, the Board is assessing the
Company's current funding requirements which will likely require the Company
to raise additional capital, potentially through the issue of new equity.
Outlook
The remainder of the year looks to be one which will see Ironveld transition
fully to producer status with some key catalysts currently at play. From a
market perspective, strong demand from customers for all three of our products
of water-atomised high purity iron powder, vanadium slag and titanium slag
continue.
It remains the Board's belief that should economic operations be achievable,
which is mainly dependent upon the sourcing and installation of a more
economical power system, the Rustenburg smelter facility represents the
greatest opportunity for Ironveld to maximise value for the magnetite ore, as
it allows for the processing of the ore into higher value metal products, such
as water-atomised high purity iron powder, vanadium slag and titanium slag.
According to market surveys, it appears that the production of higher value
iron powders is required to maximise margins in the business. Such production
requires significant investment and technical skills. The technical skills we
are beginning to develop. The potential funding from a South African based
financial institution has the potential to be transformational, so long as
that commercial scale water-atomised high purity iron powder production can be
achieved.
We would like to thank all our shareholders for their continued support for
both the Company and the Project and we look forward to providing further
updates in the near future.
John Wardle
Executive Chairman
28 March 2024
IRONVELD PLC
CONSOLIDATED INCOME STATEMENT
FOR THE PERIOD ENDED 31 DECEMBER 2023
6 Months 6 Months 12 Months
ended ended ended
31.12.23 31.12.22 30.06.23
£'000 £'000 £'000
Revenue 440 - 103
Cost of sales (154) - (29)
Gross profit 286 - 74
Administrative expenses (649) (581) (1,310)
Operating loss (363) (581) (1,236)
Other gains and losses - 47 47
Investment revenues 5 23 34
Finance costs (27) (11) (15)
Loss before taxation (385) (522) (1,170)
Taxation (129) - 711
Loss for the period (514) (522) (459)
Attributable to owners of the company (539) (520) (435)
Non-controlling interests 25 (2) (24)
(514) (522) (459)
Loss per share (pence)
Basic (0.01p) (0.02p) (0.02p)
Diluted n/a n/a n/a
The accompanying notes form an integral part of these financial statements.
IRONVELD PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 31 DECEMBER 2023
6 Months 6 Months 12 Months
ended Ended ended
31.12.23 31.12.22 30.06.23
£'000 £'000 £'000
Loss for the period (514) (522) (459)
Exchange differences on the translation of foreign operations 675 (576) (4,387)
Total comprehensive profit/(loss) for the period 161 (1,098) (4,846)
Attributable to:
Owners of the company 52 (1,015) (4,250)
Non-controlling interest 109 (83) (596)
161 (1,098) (4,846)
The accompanying notes for an integral part of these financial statements.
IRONVELD PLC
CONSOLIDATED BALANCE SHEET
AS AT 31 DECEMBER 2023
As at As at
31.12.23 30.06.23
£'000 £'000
Non-current assets
Exploration and evaluation 27,676 24,061
Property, plant and equipment 7,138 6,938
Other receivables 5 130
34,819 31,129
Current assets
Inventories 42 45
Trade and other receivables 342 307
Cash and bank balances 32 19
416 371
Total assets 35,235 31,500
Current liabilities
Trade and other payables (3,818) (1,862)
Lease liabilities (11) (10)
Borrowings (261) -
(4,090) (1,872)
Non-current liabilities
Trade and other payables (4,290) (4,162)
Lease liabilities (27) (27)
Deferred tax liabilities (3,515) (3,284)
(7,832) (7,473)
Total liabilities (11,922) (9,345)
Net assets 23,313 22,155
Equity
Share capital 13,054 12,694
Share premium 25,925 25,324
Other reserve 94 94
Retained earnings reserve (9,348) (8,845)
Foreign currency translation reserve (9,269) (9,860)
Equity attributable to owners of the company 20,456 19,407
Non-controlling interests 2,857 2,748
Total equity 23,313 22,155
The accompanying notes form an integral part of these financial statements.
IRONVELD PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIOD ENDED 31 DECEMBER 2023
Share capital Share premium Retained earnings Other reserve Attributable to the owners of the company Non-controlling interests Total equity
Foreign currency translation reserve
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Balance at 1 July 2022 10,453 21,379 (8,421) (6,045) 12 17,378 3,344 20,722
Loss for the year - - (435) - - (435) (24) (459)
Exchange differences on translation of foreign operations - - - (3,815) - (3,815) (572) (4,387)
Issue of shares 2,241 3,945 - - - 6,186 - 6,186
Issue of share warrants - - - - 82 82 - 82
Share based payments - - 11 - - 11 - 11
Balance at 30 June 2023 12,694 25,324 (8,845) (9,860) 94 19,407 2,748 22,155
Profit /(loss) for the period - - (539) - - (539) 25 (514)
Exchange differences on translation or foreign operations - - - - 591 84 675
591
Issue of shares 360 601 - - - 961 - 961
Share based payments - - 36 - - 36 - 36
Balance at 31 December 2023 13,054 25,925 (9,348) (9,269) 94 20,456 2,857 23,313
IRONVELD PLC
CONSOLIDATED CASH FLOW STATEMENT
FOR THE PERIOD ENDED 31 DECEMBER 2023
6 Months 6 Months 12 Months
Ended Ended Ended
31.12.23 31.12.22 30.06.23
£'000 £'000 £'000
Cash generated by/(used in) operating activities 1,608 (799) (672)
Interest paid (11) - (3)
Net cash generated by/(used in) operating activities 1,597 (799) (675)
Investing activities
Interest received 5 23 34
Purchase of property, plant and equipment - (1,172) (2,337)
Purchase of exploration and evaluation assets (2,861) (917) (2,513)
Loans to joint venture - - (141)
Loans received from joint venture 68 - 24
Net cash used in investing activities (2,788) (2,066) (4,933)
Financing activities
Proceeds on issue of equity (net of costs) 961 4,031 5,755
Proceeds from new loans 244 - -
Repayment of loans - (403) (140)
Payment of lease liabilities (1) - (4)
Net cash generated by financing activities 1,204 3,628 5,611
Net increase in cash and cash equivalents 13 763 3
Cash and cash equivalents at start of period 19 17 17
Effect of foreign exchange rates - (1) (1)
Cash and cash equivalents at end of period 32 779 19
Note to the cash flow statement
Operating loss (363) (581) (1,236)
Depreciation on property, plant and equipment 13 6 17
Foreign exchange differences (21) (50) (117)
Share based payments 36 60 11
Operating cash flows before movements in working capital (335) (565) (1,325)
Movement in inventories 5 - (51)
Movement in receivables 57 (316) (203)
Movement in payables 1,881 82 907
Cash generated by/(used in) operating activities 1,608 (799) (672)
The accompanying notes form an integral part of these financial statements.
IRONVELD PLC
NOTES TO THE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 DECEMBER 2023
1 Basis of preparation and accounting policies
The results for the six months to 31 December 2023 have been prepared under
International Financial Reporting Standards (IFRS) as adopted by the EU and
International Accounting Standards Board.
The accounting policies are consistent with those of the annual financial
statements for the year ended 30 June 2023, as described in those financial
statements.
The financial information does not constitute statutory accounts as defined by
section 435 of the Companies Act 2006. Full accounts of the company for the
year ended 30 June 2023 on which the Auditors gave an unqualified report, have
been delivered to the Registrar of Companies.
2 Loss per share
The calculation of basic and diluted loss per share is based upon the loss for
the period and the weighted average number of ordinary shares in issue during
the period.
6 Months 6 Months 12 Months
to 31.12.23 to 31.12.22 to 30.06.23
'000 '000 '000
Weighted average number of shares 3,666,374 2,628,958 2,963,582
Options/warrants - dilution - - -
3,666,374 2,628,958 2,963,582
Pence Pence Pence
Basic loss per share - continuing (0.01) (0.02) (0.02)
Diluted earnings per share n/a n/a n/a
Where the Group reports a loss for any period, then in accordance with IAS 33,
the share options and warrants in issue are not considered dilutive.
3 Registered office and copies of the report
The registered office is Ironveld plc, Unit D De Clare House Sir Alfred Owen
Way, Pontygwindy Industrial Estate, Caerphilly, Wales, CF83 3HU and copies of
this report are available from the registered office.
IRONVELD PLC
OFFICERS, ADVISORS AND AGENTS
Directors: John
Wardle (Executive Chairman)
Giles Clarke (Non-Executive
Director)
Nick Harrison (Non-Executive Director)
Peter Cox (Technical Director)
Malebo Ratlhagane (Executive Director and Deputy Group CFO)
Secretary: Brian
James
Company Number: 04095614 (England and Wales)
Registered Office: Ironveld Plc
Unit D De Clare House Sir Alfred Owen Way
Pontygwindy Industrial Estate
Caerphilly Wales CF83 3HU
Nominated Advisor Cavendish Capital Markets Limited
One Bartholomew Close
London EC1A 7BL
Broker Cavendish Capital
Markets Limited
One Bartholomew Close
London EC1A 7BL
Joint Broker Turner Pope
8
Frederick's Place
London EC2R 8AB
Solicitors: Kuit Steinart Levy LLP
3
St Marys Parsonage
Manchester M3 2RD
Auditors: Crowe U.K. LLP
55 Ludgate Hill
London EC4M 7JW
Bankers: HSBC
97 Bute Street
Cardiff CF10 5NA
Registrar: Link Asset Services
10(th) Floor Central Square
29 Wellington Street
Leeds LS1 4DL
Financial PR BlytheRay
4
- 5 Castle Court
London EC3V 9DL
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
or visit
www.rns.com (http://www.rns.com/)
.
RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
. END IR QKOBNKBKBDNBRecent news on Ironveld
See all newsREG - Ironveld PLC - Working Capital Facility
AnnouncementREG - Ironveld PLC - Blocklisting Return
AnnouncementREG - Ironveld PLC - TR-1: Notification of major holdings
AnnouncementREG - Ironveld PLC - Interim results for the 6 months ended 31 Dec 2023
AnnouncementREG - Ironveld PLC - TR-1: Notification of major holdings
Announcement