REG - Jangada Mines PLC - Interim Results
08/09/2023 08:30
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RNS Number : 8571L Jangada Mines PLC 08 September 2023
Jangada Mines Plc / EPIC: JAN.L / Market: AIM/ Sector: Mining
8 September 2023
Jangada Mines Plc ('Jangada' or the 'Company')
Interim Results
Jangada Mines plc ('Jangada' or 'the Company'), a natural resources company
with interests in Brazil and elsewhere, is pleased to announce its unaudited
Interim Results for the period ended six months to 30 June 2023.
CHAIRMAN'S STATEMENT
Jangada remains committed to developing and supporting projects focussed on
the wider renewable energy and battery metals sectors. To this end, our path
towards commencing development, and subsequent production, subject to, inter
alia, funding, of titanium dioxide ('TiO(2)') and vanadium pentoxide
('V(2)O(5)') at our 100% owned Pitombeiras Ferrovanadium Project
('Pitombeiras') in Brazil is becoming clearer. In addition, our investee
companies including Fodere Titanium Limited ('Fodere'), an innovative
metallurgical processing company, and Blencowe Resources plc ('Blencowe'),
which is developing a world-class graphite project in Uganda, are also making
excellent progress.
Pitombeiras Vanadium Project
Pitombeiras, located in the state of Ceará, Brazil, has a Total Mineral
Resource Estimate of 8.26Mt with 62% classified at the higher confidence
Measured & Indicated Mineral Resources category. A Technical Report
published in April 2022 demonstrated the project's robust economics including
100.3% post-tax IRR and US$96.5 million post-tax NPV (8% discount rate).
Given the market for iron ore has remained challenging, and as part of our
strategy to optimise the value of Pitombeiras, we have been exploring options
to economically extract TiO(2) and V(2)O(5) at the project. Excitingly,
during the period and having utilised Fodere's proprietary processing
technology, we announced high recovery rates from initial testwork including
86.73% TiO(2), 91.19% Fe(2)O(3), and 95.88% V(2)O(5). Our next steps include
upscaling the testwork to deliver an additional economic study to further
explore the project parameters.
ValOre Metals Corp
At the end of the reporting period, Jangada held a 0.58% interest in ValOre's
share capital, relating to the disposal of our previously owned PGM project
held by Pedra Branca Brasil Mineração Ltda. Jangada has received a total
of CAD$3,000,000 cash from ValOre and six tranches of common shares from the
disposal, which has in part supported our activities at Pitombeiras and
working capital requirements. No further payments to Jangada pursuant to the
disposal are due.
Fodere Titanium Limited
We recognise the importance of channelling capital in a responsible way
towards companies that innovate and address global challenges to create a more
sustainable world. With this in mind, in 2021 we invested in Fodere and have
continued to support it as it advances the commercialisation of its
environmentally sustainable and highly innovative technology to extract high
value metals from the titanium, vanadium, iron, and steel industries. Fodere
is currently in discussion with industrial offtakers as it advances the
development of a pilot plant in South Africa.
As highlighted by the testwork undertaken at the Company's Pitombeiras
project, the adaptation of Fodere's technology to process mined material
rather than focus on waste materials offers increased potential for its
business. Recognising this potential, Jangada acquired exclusive rights to
Fodere's IP for its application throughout South America.
At the end of the reporting period, the Company had a c.7.7% interest in
Fodere's share capital. One of Jangada's Non-Executive Directors, Nick von
Schirnding, is Chairman of Fodere.
Blencowe Resources plc
The Company has invested in LSE listed Blencowe (LSE:BRES), which is targeting
first production in 2025 at its Orom-Cross Jumbo Flake Graphite Project in
Uganda. We are very excited about the prospects of this asset, where a
Definitive Feasibility Study is on track to complete by the end of 2023.
Notably, this is being funded by an agency (proxy) of the United States
federal government that may also provide full debt funding for project
implementation from 2024.
We remain interested and supportive shareholders and at the end of the
reporting period had a 10.5% interest in Blencowe's share capital.
KEFI Gold and Copper PLC
During 2022, the Company advanced an unsecured loan receivable of £200,000
(USD 242,000) to KEFI Gold and Copper Plc ("KEFI") for working capital
requirements. The loan receivable is short-term in nature and carries a fixed
rate of interest at 25%.
During H1 2023, the loan was repaid in full by way of the issue of 35,714,285
shares in KEFI, equating to a holding currently of 0.756%.
Financial Results
As a development company, the Group is reporting a Loss from Continuing
Operations of $651k for the six months ended 30 June 2023 (30 June 2022:
$418k). Overall, the reported Total Comprehensive Loss attributable to the
Group for the reporting period was $493k (2022: $992k).
Outlook
With a combined 42.7% interest in Jangada, your Board remains committed to
delivering value to shareholders. Accordingly, we remain excited about
Pitombeiras, which has excellent upside potential, as well as our investee
companies, which are making excellent progress towards first production.
Furthermore, we continue to evaluate multiple value accretive commodity
projects and remain hopeful of completing a transaction soon.
I would like to thank shareholders for their continued support and look
forward to reporting on progress across our portfolio during the second half
of the year.
Brian McMaster
Executive Chairman
8 September 2023
CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND COMPREHENSIVE INCOME
FOR THE HALF-YEAR ENDED 30 JUNE 2023
30 June 30 June
2023 2022
(Unaudited) (Unaudited)
Notes $'000 $'000
Gain (loss) on fair value of investments (82) (247)
Profit on disposal of investments - 71
Directors' remuneration (179) (185)
Foreign exchange (loss)/gain (40) 338
Administration expenses (350) (394)
Operating loss from continuing operations (651) (417)
Finance expense - (1)
Loss before tax (651) (418)
Tax expense 5 - -
Loss from continuing operations (651) (418)
Other comprehensive income:
Items that will or may be classified to profit or loss:
Currency translation differences arising on translation of foreign operations 158 (574)
Total comprehensive loss attributable to owners of the parent (493) (992)
Loss per share from loss from continuing operations attributable to the Cents Cents
ordinary equity holders of the Company during the period
- Basic (cents) 6 (0.25) (0.16)
- Diluted (cents) 6 (0.25) (0.16)
Loss per share attributable to the ordinary equity holders of the Company Cents Cents
during the period
- Basic (cents) 6 (0.25) (0.16)
- Diluted (cents) 6 (0.25) (0.16)
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2023
30 June 31 December
2023 2022
(Unaudited) (Audited)
Notes $'000 $'000
Assets
Non-current assets
Exploration and evaluation assets 1,230 1,210
Property, plant and equipment 3 4
Investments 8 2,539 2,081
3,772 3,295
Current assets
Other receivables 4 302
Cash and cash equivalents 786 1,397
790 1,699
Total assets 4,562 4,994
Liabilities
Current liabilities
Trade payables 129 21
Accruals and other payables 66 113
Total liabilities 195 134
Issued capital and reserves attributable to owners of the parent
Share capital 10 135 135
Share premium 10 5,959 5,959
Translation reserve (596) (754)
Option reserve 11 709 709
Fair value reserve 38 38
Retained earnings (1,878) (1,227)
Total equity 4,367 4,860
Total equity & liabilities 4,562 4,994
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE HALF-YEAR ENDED 30 JUNE 2023
Translation reserve Fair value reserve Option Retained earnings
Share capital reserve Total equity attributable to owners
Share premium
$'000 $'000 $'000 $'000 $'000 $'000 $'000
Balance as at 1 January 2022 135 5,959 (362) 38 734 (170) 6,334
Total comprehensive loss for the year - - - - - (418) (418)
Loss for the half-year
Other comprehensive loss - - (574) - - - (574)
Total comprehensive loss for the year - - (574) - - (418) (992)
Transactions with owners in their capacity as owners
Shares issued - - - - - - -
Share options issued - - - - - - -
Total transactions with owners - - - - - - -
Balance at 30 June 2022 135 5,959 (936) 38 734 (588) 5,342
135 5,959 (754) 38 709 (1,227) 4,860
Balance as at 1 January 2023
Total comprehensive loss for the year - - - - - (651) (651)
Loss for the half-year
Other comprehensive loss - - 158 - - - 158
Total comprehensive loss for the year - - 158 - - (651) (493)
Transactions with owners in their capacity as owners
Shares issued - - - - - - -
Shares options issued - - - - - - -
Total transactions with owner - - - - - - -
Balance at 30 June 2023 135 5,959 (596) 38 709 (1,878) 4,367
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
FOR THE HALF-YEAR ENDED 30 JUNE 2023
30 June 30 June
2023 2022
(Unaudited) (Unaudited)
Cash flows from operating activities $'000 $'000
Profit / (Loss) before Tax from continuing operations (651) (418)
Cash proceeds on sale of investment - (71)
Fair value gain/(loss) in investments 82 (178)
Non-cash exchange difference 40 302
Decrease/(increase) in other receivables (298) (300)
(Decrease)/increase in trade and other payables 61 (102)
Net cash outflow from operating activities (766) (767)
Investing activities
Development of exploration and evaluation assets (74) (146)
Non-cash investment from conversion of short-term loans 310 -
Purchase of plant, property and equipment - -
Sale of shares in investment - 148
Purchase of shares in investment (127) (61)
Net cash (outflow) / inflow from investing activities 109 (59)
Financing activities
Share capital issue - -
Cancellation of options (27) -
Net cash from financing activities (27) -
Net movement in cash and cash equivalents (684) (826)
Cash and cash equivalents at beginning of period 1,397 3,588
Movements in foreign exchange 73 226
Cash and cash equivalents at end of period 786 2,988
NOTES TO THE CONDENSED FINANCIAL INFORMATION
FOR THE HALF-YEAR ENDED 30 JUNE 2023
1. General Information
The Company is a public limited company limited by shares,
incorporated in England and Wales on 30 June 2015 with the registration number
09663756 and with its registered office at 20 North Audley Street, London W1K
6WE. The Company's principal activities are the exploration and development of
mining assets in Brazil.
2. Accounting Policies
Basis of preparation
The condensed consolidated interim financial statements have
been prepared in accordance with the requirements of the AIM Rules for
Companies. As permitted, the Company has chosen not to adopt IAS 34 "Interim
Financial Statements" in preparing this interim financial information. The
condensed consolidated financial information for the six months ended 30 June
2023 has been prepared on a basis consistent with, and on the basis of, the
accounting policies set out in the financial information in the Company's
published results for the year-end to 31 December 2022. The interim financial
statements of the Company have been prepared on the basis of the accounting
policies, presentation, methods of computation and estimation techniques
expected to be adopted in the financial information by the Company in
preparing its annual report as at 31 December 2023.
The interim financial information set out above does not
constitute statutory accounts within the meaning of the Companies Act 2006. It
has been prepared on a going concern basis in accordance with the recognition
and measurement criteria of UK-adopted International Accounting Standards, and
hence the previously reported accounting policies still apply.
The interim condensed consolidated financial statements do
not include all of the information required for full annual financial
statements and should be read in conjunction with the audited consolidated
financial statements of the Company as at and for the year ended 31 December
2022.
Statutory financial statements for the year ended 31 December
2022 were approved by the Board of Directors on 29 June 2023 and delivered to
the Registrar of Companies. The report of the auditors on those financial
statements was unqualified.
The Board have conducted a review of forecast earnings and cash over the next
twelve months, considering various scenarios and sensitivities. The Board have
a reasonable expectation that the Company has adequate resources to continue
in operational existence for the foreseeable future. Accordingly, they
continue to adopt the going concern basis in preparing the interim financial
statements.
The consolidated financial information is presented in United States Dollars
($), which is also the functional currency of the Company. Amounts are rounded
to the nearest thousand ($'000), unless otherwise stated.
Changes in accounting principles and adoption of new and
revised standards
In the year ended 30 June 2023, the Directors have reviewed all the new and
revised Standards. There are no standards in issue but not yet effective which
could have a material impact on the financial statements.
Going concern
The Directors, having made appropriate enquiries, consider that adequate
resources exist for the Company and Group to continue in operational existence
for the foreseeable future and that, therefore, it is appropriate to adopt the
going concern basis in preparing the condensed consolidated interim financial
statements for the period ended 30 June 2023.
The interim Financial Statements have been prepared on a going concern basis.
Although the Group's assets are not generating revenues and an operating loss
has been reported, the Directors are of the view that the Group has sufficient
funds to meet all committed and contractual expenditure and to maintain good
title to the exploration licences.
As disclosed in the 31 December 2022 financial statements, the directors do
not consider there to be a material uncertainty, which may cast doubt about
the Group and Company's ability to continue as a going concern. The Directors
have a reasonable expectation that the Group will have adequate resources to
meet its capital requirements for the foreseeable future. For that reason, the
Directors have concluded that the financial statements should be prepared on a
going concern basis.
3. Critical accounting estimates and judgements
Except as described below, the same accounting policies, presentation and
methods of computation have been followed in these condensed consolidated
interim financial statements as were applied in the preparation of the Group's
annual financial statements for the year ended 31 December 2022.
Judgements
Given the proceeds from the sale of the Pedra Branca project and based on the
Company's planned expenditure on the Pitombeiras vanadium deposit and the
Company's working capital requirements, the Directors have a reasonable
expectation that the Company will have adequate resources to meet its capital
requirements for the foreseeable future.
The Directors have considered the criteria of IFRS 6 regarding the impairment
of exploration and evaluation assets and have decided based on this assessment
that there is no basis to impair the carrying value of its exploration assets
for the Pitombeiras project (2023: $nil, 2022: $nil) at this time.
Estimates and assumptions
In arriving at the carrying value of investments in associates, the Company
determines the need for impairment based on the level of geological knowledge
and confidence of the mineral resources. Such decisions are taken on the basis
of the exploration and research work carried out in the period utilising
expert report.
The Company measures share options at fair value. For more detailed
information in relation to the fair value measurement of such items, please
refer to Note 11.
4. Segment information
The Company evaluates segmental performance on the basis of profit or loss
from operations calculated in accordance with IFRS 8. In the Directors'
opinion, the Company only operates in one segment: mining services. All
non-current assets have been generated in Brazil.
The Directors believe that the Company's operations are not subject to any
significant seasonality.
5. Tax expense
Half-year ended Half-year ended
30 June 2023 30 June 2022
Continuing operations Continuing operations
(Unaudited) (Unaudited)
$'000 $'000
Loss on ordinary activities before tax (651) (418)
Loss on ordinary activities multiplied by standard rate of corporation tax in (163) (79)
the UK of 25% (2022: 19%)
Effects of:
Recognition of previously unrecognised tax losses - -
Unrelieved tax losses for the period carried forward 163 79
Total tax charge for the period on continuing operations - -
Factors that may affect future tax charges
Apart from the losses incurred to date, there were no factors that may affect
future tax charges.
6. Loss per share
Half-year Half-year
ended ended
30 June 30 June
2023 2022
(Unaudited) (Unaudited)
$'000 $'000
Loss for the year (651) (418)
2023 2022
Weighted average number of shares (basic & diluted) 258,602,032 258,602,032
Loss per share - basic & diluted (US 'cents) (0.25) (0.16)
There have been no transactions involving ordinary shares or potential
ordinary shares that would significantly change the number of ordinary shares
or potential ordinary shares outstanding between the reporting date and the
date of completion of these financial statements.
7. Exploration & evaluation assets
Exploration and evaluation assets represent the costs of pre-feasibility
studies, field costs, government fees and the associated support costs at the
Company's Pitombeiras West vanadium deposit project. The ultimate recoupment
of costs carried forward for exploration expenditure is dependent on the
successful development and commercial exploitation or sale of the respective
mining areas.
8. Investments
As at As at
30 June 31 December
2023 2022
(Unaudited) (Audited)
$'000 $'000
Investment in ValOre Corp. 49 203
Investment in Fodere Titanium Limited 1,022 976
Investment in Blencowe Resources Plc 1,340 1,030
Investment in Axies Ventures Limited 63 60
Investment in KEFI Gold and Copper Plc 262 -
Impairment in Investments (197) (188)
Carrying amount of investments 2,539 2,081
Level 1 Level 2 Level 3 Total
As at 30 June 2023 (Unaudited) $'000 $'000 $'000 $'000
Assets
Investments - At FVTPL 1,651 888 - 2,539
Total assets 1,651 888 - 2,539
Level 1 Level 2 Level 3 Total
As at 31 December 2022 (Audited) $'000 $'000 $'000 $'000
Assets
Investments - At FVTPL 1,233 848 - 2,081
Total assets 1,233 848 - 2,081
The Company holds shares in the share capital of Fodere Titanium Limited.
Fodere Titanium Limited is a United Kingdom registered minerals technology
company which has developed innovative processes for the titanium, vanadium,
iron and steel industries. The investment is carried at fair value with any
changes recognised through profit and loss.
The Company also holds an investment in the share capital of Blencowe
Resources Plc. Blencowe Resources Ltd is a United Kingdom registered natural
resources company focused on the development of the Orom-Cross Graphite
Project in Uganda.
The Company also acquired an investment in the share capital of Axies Ventures
Limited. Axies Ventures Ltd is a United Kingdom registered exploration and
development company focused on the Axies Copper Project in Cyprus.
During the half-year, the Company converted its loan receivable into
35,714,285 shares in AIM listed KEFI Gold and Copper Plc at 0.7 pence per
share.
9. Other receivables
During the half-year period, the Company converted its loan receivable from
KEFI Gold and Copper into 35,714,285 shares in KEFI.
10. Share capital
30 June 2023 31 December 2022
Issued Share Capital Share premium Issued Share Capital Share premium
Number $'000 $'000 Number $'000 $'000
At beginning and end of the period ordinary shares of 0.04p each: 258,602,032 135 5,959 258,602,032 135 5,959
Ordinary shares
Ordinary shares have the right to receive dividends as declared and, in the
event of a winding up of the Company, to participate in the proceeds from sale
of all surplus assets in proportion to the number of and amounts paid up on
shares held. Ordinary shares entitle their holder to one vote, either in
person or proxy, at a meeting of the Company.
11. Share options and warrants
Average exercise price per share option Period ended 30 June Average exercise price per share option Year ended 31 December 2022
$
$
2023 Number of
Number of options
options
At the beginning of the period - 34,844,444 - 37,844,444
Share options surrendered 17 January 2022 - - 0.02 (3,000,000)
At the end of the period 34,844,444 34,844,444
On 17 January 2022, the Company entered into an agreement whereby an option
holder agreed to surrender 3,000,000 options, with a grant date of 1 December
2019 and an expiry date of 1 December 2024 with an exercise price £0.02 per
option share, for consideration of £105,000 (US$143,596). The amounts were
paid in 15 equal monthly instalments of £7,000 (US$9,573). On the same date
the options were cancelled by the Company.
As at As at
30 June 2023 31 December 2022
$'000 $'000
Share based payments reserve
At beginning of year 709 734
Share based payments surrendered - (25)
Closing balance 709 709
In December 2019, as part of an award of the Director/Consultant Options, all
of the individuals concerned, together with the other Directors of the Company
who were not receiving new share options surrendered their existing holdings
of share options, which in total aggregated 8,000,000 share options. These
share options were awarded at the time of the Company's IPO on AIM in June
2017, with an exercise price of 5 pence per share option (6.5 US cents), and
an expiry date of 31 December 2019.
Share options warrants outstanding at the end of the period have the following
expiry date and exercise prices:
Share options/warrants 30 June Share options/warrants 31 December
2023 2022
Exercise price
Grant date Expiry date £
1 December 2019 30 November 2024 0.02 3,150,000 3,150,000
19 February 2021 19 February 2024 0.09 694,444 694,444
10 August 2021 10 August 2025 0.08 31,000,000 31,000,000
The fair value at grant date is independently determined using an adjusted
form of the Black Scholes Model that takes into account the exercise price,
the term of the option, the impact of dilution (where material), the share
price at grant date and expected price volatility of the underlying share, the
expected dividend yield, the risk-free interest rate for the term of the
option and the correlations and volatilities of the peer group companies. In
addition to the inputs in the table above, further inputs as follows:
The model inputs for the 694,444 warrants granted for consulting service
during the period included:
(a) warrants are granted for no consideration and vested warrants are
exercisable for a period of three years after the grant date: 19 February
2021.
(b) expiry date: 19 February 2024.
(c) share price at grant date: 9.6 pence.
(d) expected price volatility of the company's shares: 100%.
(e) risk-free interest rate: 0.70%.
The model inputs for the 30,000,000 director and Brazilian employee options
and 1,000,000 third party warrants granted for consulting services during the
year included:
(a) 30,000,000 options are granted and split into two Tranches, whereby
20,250,000 tranche A options have vesting conditions linked to performance and
9,750,000 Tranche B options vest immediately.
(b) Tranche A is split further with 9,450,000 options vesting once all
necessary permits required to commence production are received and then a
further 10,800,000 options vest upon commencement of production at the
Pitombeiras Vanadium Project.
(c) The 9,450,000 options have a vesting period of two years from grant
date and the 10,800,000 options have a vesting period of three years from the
grant date.
(d) 1,000,000 warrants are granted for no consideration and vested warrants
are exercisable for a period of three years after the grant date: 10 August
2021.
(e) expiry date: 10 August 2025.
(f) share price at grant date: 8.0 pence.
(g) expected price volatility of the company's shares: 70.24%.
(h) risk-free interest rate: 0.591%.
12. Related Party Transactions
During the period the Company entered into the following transactions with
related parties:
Half-year ended Half-year ended
30 June 2023 30 June 2022
(Unaudited) (Unaudited)
$'000 $'000
FFA Legal Ltda
Legal and accountancy services expensed 36 47
FFA Legal Ltda is a related party to the Company due to having a director in
common with Company. At the period end it was owed $nil (2022: $nil).
13. Parent Entity
Parent Entity Information 30 June 31 December
2023
2022
$'000 $'000
(Unaudited) (Audited)
Current assets 765 1,665
Total assets 4,956 5,348
Current liabilities 194 129
Total liabilities 194 129
Net Assets 4,762 5,219
Share capital 135 135
Share premium 5,959 5,959
Reserves (614) (847)
Accumulated losses (718) (28)
Total Equity 4,762 5,219
Loss of the parent entity (690) (166)
Other comprehensive profit for the year - -
Total comprehensive loss of the parent entity (690) (166)
14. Subsequent Events
There have been no significant events after the reporting period.
15. Nature of Financial Information
The condensed consolidated interim financial information presented above does
not constitute statutory financial statements for the period under review.
16. Approval of interim financial statements
The Condensed interim financial statements were approved by the Board of
Directors on 7 September 2023.
**ENDS**
For further information please visit www.jangadamines.com
(http://www.jangadamines.com/) or contact:
Jangada Mines plc Brian McMaster (Chairman) Tel: +44 (0)20 7317 6629
Strand Hanson Limited Ritchie Balmer Tel: +44 (0)20 7409 3494
(Nominated & Financial Adviser) James Spinney
Tavira Securities Limited Jonathan Evans Tel: +44 (0)20 7100 5100
(Broker)
St Brides Partners Ltd Ana Ribeiro jangada@stbridespartners.co.uk
(Financial PR) Isabel de Salis
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